January 5, 2014

Bits Bucket for January 5, 2014

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

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Comment by Carl Morris
2014-01-05 01:06:56

More Shanghai: Took a taxi to church about 15 miles away on the other side of downtown. Got hooked up with the locals there and rode the subway back. It was all interesting. Talk about miles and miles and miles of crappy apartment towers with clothes on all the railings clear up to what looked like 30-40 stories up…mixed with new ones that nobody lives in. Because the govt puts tight controls on churches the expat Mormons and the few Chinese citizen Mormons aren’t allowed to meet together…so meetings for me were pretty much same as being in Utarr. At least with the men…I noticed a lot of the kids were half Asian, though, and much more Asian wives than you would see in Utarr.

I’d have never figured out the subway system without help, but it was nice once you understood it. And about a dollar to go anywhere compared to almost $20 to go 15 miles this morning.

Comment by Whac-A-Bubble™
2014-01-05 08:30:13

“Talk about miles and miles and miles of crappy apartment towers with clothes on all the railings clear up to what looked like 30-40 stories up…mixed with new ones that nobody lives in.”

Maybe the reason Chinese investors prefer purchasing empty apartment buildings has something to do with the dirty laundry adorning the occupied ones?

Comment by aNYCdj
2014-01-05 08:45:44

China’s hi-tech emperors From a global online ‘anything store’ to high-end smartphones challenging Apple, a generation of billionaire entrepreneurs is rising in the East


Comment by rms
2014-01-05 09:39:35

“…‘anything store’…”

+1 Anything from pirated copy if ms-office to a shanghai’d teen liver.

Comment by Whac-A-Bubble™
2014-01-05 11:11:41

“…and much more Asian wives than you would see in Utarr.”

How many wives per member? ;-)

Comment by Whac-A-Bubble™
2014-01-05 11:18:11

Have you followed this story?

I don’t understand why Southern Baptists feel they are entitled to a say in Utah state law. I thought this country was founded on the Constitutional principles of freedom of religion and separation of church and state; if not, I stand corrected.

Traditional Marriage Under Scrutiny in Utah Courts
Wednesday, January 01, 2014

A federal ruling that decriminalizes polygamy in Utah is being criticized by the Southern Baptist Convention.

The recent decision declares that a Utah law forbidding co-habitation with another person violates the First Amendment.

But the Baptist convention’s top public policy official Russell D. Moore said “decriminalizing polygamy puts vulnerable women and children at risk.”

He also warned that “the ruling undermines the Bible’s definition of marriage as a the union of one man and one woman.”

Moore is president of the Southern Baptist Ethics & Religious Liberty Commission (ERLC).

While the ruling does not legalize multiple marriages, it means polygamist families who live together cannot be prosecuted.

Comment by In Colorado
2014-01-05 16:40:28

Well … legally they are not polygamous, as the man only has a single legal wife, who happens to tolerate that he also has a few live in girlfriends. Sounds legally more like swinging than polygamy to me.

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Comment by Pete
2014-01-05 18:52:55

“Sounds legally more like swinging than polygamy to me.”

It does, but the women don’t get the same deal, at least as far as I know. I wouldn’t have a problem with it if it worked both ways.

Comment by Avocado99
2014-01-05 18:20:47

From yesterday… How can you blame liberals, seriously.

1) You throw your money away on rent but a house is an investment.
2) Taxation is necessary to have for a civil society.
3) Guns kill.
4) Ownership society
5) Spread the wealth around

REAGAN grew gov, tripled the deficit, game amnesty to millions and started the trickle down thang, that got us in trouble and is a scam.

Now Obama might just be the most economically successful pres:

Recall 2009. Things looked pretty bleak economically.

But the outlook has changed dramatically in just 4 years. And it has been a boon for investors, as even the safest indices have yielded a 250% return (>25% annualized compound return:)

Google for the FOrbes article.

Comment by Dudgeon Bludgeon
2014-01-05 18:57:38

Is this your first time in Asia?
Go take a walk along the Old City wall when you have some time.

Comment by Whac-A-Bubble™
2014-01-05 19:02:49

Also check out this video when you have a chance to do so.

Comment by Whac-A-Bubble™
2014-01-05 19:05:52

They are Utahns.

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Comment by Carl Morris
2014-01-05 20:20:37

Is this your first time in Asia?

Yes, it is.

Comment by Realtor Fun
2014-01-05 20:38:31

Shanghai Hong Kong Egg Foo Yung, Carls work is never done.

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Comment by Dudgeon Bludgeon
2014-01-06 06:31:21

Lots of surprises then. I look forward to your observations.

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Comment by Whac-A-Bubble™
2014-01-05 20:43:27

Do you have any sense of what is vexing Chinese stock traders at the moment?

Comment by Whac-A-Bubble™
2014-01-05 20:45:32

Jan. 5, 2014, 9:22 p.m. EST
China stocks fall, with financial shares lower
By Laura He

HONG KONG (MarketWatch) — Hong Kong stocks fell at the start of trading Monday, with the Hang Seng Index (HK:HSI -0.76%) down 0.8%. Financial shares led the decline, with China Life Insurance Co. (HK:2628 -1.74% LFC -1.28%) plunging 2.6%, Bank of Communications Co. (HK:3328 -2.28% BKFCF -7.65%) losing 2%, Industrial and Commercial Bank of China (HK:1398 -1.58% IDCBF -1.48%) down 1.4%. Resources stocks dropped, as China Resources Enterprise Ltd. (HK:291 -1.78%) dropped 2.4% and China Resources Power Holdings Co. (HK:836 -1.81%) declined 1.6%.

Comment by Whac-A-Bubble™
2014-01-05 22:37:02

China shares sink to 5-month low, Hong Kong also weaker
Sun Jan 5, 2014 11:36pm EST

* HSI -0.6 pct, H-shares -1.5 pct, CSI300 -2.3 pct

* Weak HSBC China flash services PMI adds to data gloom

* Financials, property-related, railway lead losses

By Clement Tan

HONG KONG, Jan 6 (Reuters) - China shares touched five-month lows early on Monday, weighing on Hong Kong markets, after a survey showing weak services sector growth in the mainland added to concerns of slowing growth.

Both markets have now erased gains from a key policy meeting in November that was seen as Beijing’s boldest commitment to reform in decades. Investors are now counting the cost of those reforms, which they fear will involve a deeper crackdown on shadow banking as Beijing reins in credit growth.

There are also rising concerns that the resumption of initial public offerings in the mainland — with nearly 30 approved so far — will further sap tight money supply. Rates are expected to stay elevated ahead of the Lunar New Year, which falls at the end of January.

At midday, the CSI300 of the leading Shanghai and Shenzhen A-share listings was down 2.3 percent. The Shanghai Composite Index sank 1.9 percent. Both are now languishing at their lowest since August.

The Hang Seng Index shed 0.6 percent to 22,680.8 points, while the China Enterprises Index of the top offshore Chinese listings in Hong Kong slid 1.5 percent and is now at its most technically oversold level since July.

Losses in both markets came in relatively robust volumes. In Shanghai, about 12 stocks declined for every counter that rose, while about 4 stocks fell for every stock that advanced.

I think it’s quite clear this is not yet the bottom. There’s going to be more losses ahead,” said Hong Hao, chief strategist at Bank of Communication International.

Comment by Whac-A-Bubble™
2014-01-05 22:42:40

The global economy sure could use some decoupling about now!

China slowdown fears weigh on market
January 6, 2014 - 4:25PM

Australian shares fell on Monday as a dip in commodity prices dragged on resource stocks and as growth in China’s services sector slowed sharply, raising concerns about the pace of recovery in Australia’s largest export market.

The S&P/ASX 200 index fell 0.5 per cent or 25.2 points, its biggest one day drop in three weeks, to 5324.9. The benchmark added 0.5 percent last week for its third week of gains.

The China HSBC/Markit services sector Purchasing Managers’ Index (PMI) dropped to 50.9 in December from 52.5 in November, with business expansion the slowest in six months.

The PMI follows a similar survey by China’s National Bureau of Statistics on Friday, which showed a slowdown in service-sector growth to a four-month low of 54.6 from the previous month’s 56.0.

The weaker PMIs added steam to a fall in Asian markets on Monday, on concern over whether China’s slowdown will continue into the first quarter.

“What has been the principal sort of driver of the market since the beginning of the new year has been a disappointment of the Chinese PMI data,” said Guy Stear, Asian credit and equity strategist at Societe Generale in Hong Kong, adding that growth in China is a “focal point” for markets.

Comment by simiwatch
2014-01-05 23:28:50

Hi Carl:

I am in Shanghai. Have been here for almost a year. Let me know how to contact you and I will show you the ropes in Shanghai.

Comment by Carl Morris
2014-01-06 03:04:30

Email address is cd and the number two at cdmorris dotcom. Don’t have much free time though. It is surprising how many people are over here…I ran into a relative at church.

Comment by taxpayers
2014-01-05 04:56:55

RE taxes up 4.4 % last year and ? this year. You can lock in low int rates,but your county has big plans for your cash………..

Comment by 2banana
2014-01-05 08:07:39

FU - Pay up.

Don’t and we send a public union goon with a gun to take your house

Public union goons need to retire with 20 years of working with a lifetime of a spike OT pensions and free medical.

It is a constitutional right.

Comment by Greenshirtwebcamtransient
2014-01-05 08:20:16

Or they could keep working and have their full pension payment dropped in to an account paying 8 percent interest while still collecting their top of the scale salary. Then after 5 more years walk away with a fat check for being retired while still working.

Screw the rookies! (who do the same job for 1/2 the pay)

Comment by taxpayers
2014-01-05 08:51:05

pu goons scare me way more than alkady or other threats. They’re winning

Comment by Greenshirtwebcamtransient
2014-01-05 08:59:48

Corruption in your backyard is much worse than corruption half a world away. Not too many LieBs willing to step up and condemn this massive corruption that has pretty much destroyed our local political infrastructure and schools.

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Comment by Rental Watch
2014-01-05 17:48:09

Unless you live in CA…where by law your property taxes can’t go up by more than 2% per year, regardless of how much your home has gone up in value.

Comment by Housing Analyst
2014-01-05 20:40:13

Considering housing prices have resumed falling in California, how far does your inflated property taxes fall?

Comment by Mr. Banker
2014-01-05 05:53:52

Beautiful isn’t it? Lock in a FB for 30 years or so then jack up his costs.

What’s really beautiful is to lure in a business to your city or county or state by offering some sort of tax break - say offering the lured-in business ten years of operation without any tax liability whatsoever. Then, after the ten years are up, the business can cash in on another tax-free offer from a different city, county or state and pack up and move there.

Do this and do this and do this and you will end up growing rich at the expense of everybody else.

Comment by Mr. Banker
2014-01-05 06:08:24

Oooops, this was meant to be a response to taxpayer’s post.

What is really neat is to move your business into a city and buy up a large building - one that pays a lot of taxes - and then get yourself exempted from paying these taxes. The tax revenue to the city (or county or whatever) will decrease as a result of this action but this should not matter to you because your tax expenses will decrease by the same amount.

If your actions along with the combined actions of other businesses who are doing the same thing reach the tipping point and push the city (or county or whatever) into financial dire straights then all you need to do is pack up and move somewhere else.

Think of it as a corporate policy of search and destroy.

And the best part (ta da) is when you move your employees will be forced to move right along with you. And if they can’t move because they are locked in by RE commitments or by other commitments then they will have to quit. And when they quit all promises of pensions and such end up becoming empty promises.

As I said, search and destroy.

Comment by azdude02
2014-01-05 07:48:54

u need a place to live so why not make some cash while your enjoying the peace of mind of owning a home?

renting is ok if its temporary.

Comment by Bill, just South of Irvine
2014-01-05 08:03:00

For those who understand you have to be mobile to obtain the best pay, where you live must always be temporary.

As a consultant I was typically making $50,000 per year more than direct hires for over ten years. The only catch is I had to be in different city for a year or so at a time, sometimes 2,400 miles away from my last job, and start on the Monday following the Friday of my last day on the job.

My tax break would be many times more than the Mortgage interest deduction.

Trying to become rich by being a landlord on your second house is for the peanut gallery.

Comment by azdude02
2014-01-05 08:09:09

we know your insolvent bill.

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Comment by ibbots
2014-01-05 08:20:40

What’s the tax break?

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Comment by Bill, just South of Irvine, CA
2014-01-05 11:14:28

It is found on the IRS web site. I will say as much that it’s a publication ;) - see, I am going to go back into consulting, I don’t want to make it so attractive that everyone goes into consulting and spoils the tax break. Congress will get rid of that tax break and the fun is over. Sorry!

As consolation, I figure there are at least a dozen tax breaks you can use, Ibbots, but you don’t know about and I would not be surprised if you are paying 25% or more in taxes to the thugernment than you can get away with without danger of being audited.

If everyone of us taxpayers was diligent enough to find our tax breaks and use them, we’d have far more power than the FSA and force government to cut programs.

Comment by Blue Skye
2014-01-05 08:25:16

“why not make some cash…”

Caricature of the American culture: Debt is Wealth.

Why not live within your means and have a higher standard of living?

Comment by Bill, just South of Irvine
2014-01-05 07:56:20

I prefer renting very inexpensive but decent small apartment close to whereever I work in Southern Cal. Much cheaper than owning, and taking my 401k and unrealized gains with me back to my low tax state of Arizona when I am done working in Cali :)

I should be thankful that I am surrounded and outnumbered by the FBs paying property taxes on way overpriced stucco boxes to fund the fire department and cops. I am in a very safe area in OC. Rent is $1350.

And there are a lot of other companies to work at within similar short drive.

18 minute commute to work is about 1/3 the time I drove when I lived in Tucson.

Comment by Whac-A-Bubble™
2014-01-05 08:09:42

Good points, Bill. We renters all owe a debt of gratitude to the FBs who are willing to accept ever-higher property tax bills to fund local government services. If you live in the Poway Unified School District, you particularly owe your homeowner neighbors thanks for their willingness to help pay off the capital appreciation bonds used to fund current school district investments.

The Financial Times of London
August 9, 2012 8:35 pm
School bonds could trigger fiscal shock
By Gillian Tett
San Diego sees dangerous cocktail of financial innovation and debt

A decade ago, San Diego county in California was at the cutting edge of some dangerous financial games.

As the housing boom got under way, bankers and mortgage brokers became adept at flogging subprime loans to households across the area using “innovative” structures. That episode, of course, ended in tears, not just in San Diego but elsewhere in America.

Now, some new financial games have come to light involving a dangerous cocktail of innovation and debt. This time, it is not private households involved but public sector bodies – specifically, schools.

The issue at stake revolves around some exotic bonds issued by San Diego educational authorities in recent years. Once upon a time (think six long decades ago), US school authorities used to finance themselves primarily by using taxes. Then they started to issue a swelling volume of bonds to supplement those taxes.

But as the fiscal situation in California has deteriorated, voters have become so upset they have imposed various fiscal straitjackets on educational boards. Worse, property tax revenues, which have been used to fund schools, have declined as the housing market has crashed.

That has left schools in a bind. So, local financial advisers have offered some “innovative” solutions. Last year, Poway Unified, one San Diego educational district, issued some $105m worth of “capital appreciation” bonds to finance previously planned investment projects.

These are similar to zero-coupon bonds, meaning the district does not need to start repaying interest or capital until 2033.

As a result, Poway’s local authority has been able to promise to keep local taxes unchanged while completing previously promised investments (building projects, computers and so on).

But, there is a big catch: to compensate for this payment deferral, these bonds are paying highish (7 per cent) interest rates and cannot be redeemed early. When the bond is repaid in 2051, the total bill will be more than 10 times the initial loan.

The Poway local authorities insist this still makes sense. After all, they argue, their children cannot wait for new schools until tax revenues grow again. But the danger is clear. Though these bonds shield taxpayers (and politicians) from expenditure today, they create a headache later. At best, this is a case of kicking the can down the road; at worst, a case of the government dancing with loan sharks.

It is difficult to tell just how many other capital appreciation bonds exist. As the Securities and Exchange Commission pointed out last week, the $2.7tn municipal bond market is alarmingly opaque. In the Poway case, the details came to light because of some excellent investigative reporting by Joel Thurtell, a blogger, and Will Carless, a reporter at the Voice of San Diego, a local news group.

Carless has unearthed similar but slightly less extreme schemes at other San Diego school authorities, such as Oceanside Unified (which borrowed $30m but will need to repay $280m), Escondido Union (borrowed $27m, faces $247m repayments) and San Diego Unified (borrowed $164m, will repay $1.2bn).

However, the really big unknown is the degree to which this reflects a bigger, national pattern. Optimists might argue California is an extreme example; after all, its fiscal woes are among America’s worst.

Comment by Greenshirtwebcamtransient
2014-01-05 09:03:46

California is an innovator– in fraud.

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Comment by Greenshirtwebcamtransient
2014-01-05 08:48:23

Why a single person without kids would ever buy a house is beyond me. Especially these days with no guarantees of stability in job. The whole discussion is silly.

This bubble isn’t about whether single people without kids should buy or rent. They are a tiny fraction of the potential buyers.

Comment by Martin
2014-01-05 10:04:09

Don’t know about stability of jobs. But is the new H1B program increases the quota to 115K. Is it a law now? Is it really cheap labor or real talent that US can use? H1B looks more like a scam that companies like TCS/Infy are milking to get more and more H1B people on client sites at cheap hourly costs.


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Comment by Bill, just South of Irvine, CA
2014-01-05 12:01:17

This bubble isn’t about whether single people without kids should buy or rent. They are a tiny fraction of the potential buyers.

Valid point. But even for families, renting a SFH is a better deal in most cases than buying, particularly since many families move every six or seven years. In 21 years that is three moves. Think of how much the closing costs and brokers fees it would take for buying and selling three houses in seven years. Combine that with low pay and the verdict is in:

Renting is always cheaper than buying - for singles without or with kids and for families.

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Comment by Whac-A-Bubble™
2014-01-05 12:08:23

“But even for families, renting a SFH is a better deal in most cases than buying, particularly since many families move every six or seven years.”

If you want your kids to attend a good public high school but don’t want to face the risk of buying an overpriced house in a good school district that you can’t sell for what you paid after your kids graduate, the obvious strategy is to rent in the good district while your kids are in school, then move away when they are done. Meanwhile invest the savings from not paying an overpriced mortgage in a diversified portfolio that pays a higher return with less risk than falling knife housing.

Comment by Bill, just South of Irvine, CA
2014-01-05 13:37:12

Yes that is a good strategy.

Suppose a family has three kids within four years apart. Well from age 5 to 18 good schools are important. So that’s 14 years. Add 4 more and it’s 18 years you have to be in a great district. No more. You are done after that. Then they are off to college and you and your spouse can downsize and move to a two bedroom apartment in the Mission Bay area or even La Jolla. And of course renting a 2 bedroom apartment in either of those areas is ALWAYS far cheaper than owning.

Then maybe ten years later retirement is likely. Tax free Nevada. For skiers, Carson City, NV would be the place. No state tax on your 401k or IRA distribution. No state capital gains tax on your long time low expense Vanguard stock index funds. And it’s cheaper to go back to the Cali coast as a vacationer.

Comment by Whac-A-Bubble™
2014-01-05 15:35:52

Nine years down, four-and-a-half to go.

Comment by Housing Analyst
2014-01-05 06:09:35

“Housing is a depreciating asset and a loss, ALWAYS”


Comment by Blackhawk
2014-01-05 06:37:43

Republicans to Open 2014 With Obamacare Data-Theft Bill - National Journal

“The House next week will consider legislation that would require the Centers for Medicare and Medicaid Services to notify consumers whenever a security breach occurs, House Majority Leader Eric Cantor announced Thursday in a memo to Republicans.

Under present policy, CMS evaluates whether consumer data were at risk when deciding if an issue warrants notification—but Cantor wants to make notification automatic.”

“If a breach occurs, it shouldn’t be up to some bureaucrat to decide when or even whether to inform an individual that their personal information has been accessed,”

it amazes me that they continually exempt themselves from common sense actions. How many have already had their identities stolen? We don’t know because we all know that info would hurt the cause.

Aren’t corporations legally required to announce any consumer data breaches???

Comment by jose canusi
2014-01-05 07:33:59

“Aren’t corporations legally required to announce any consumer data breaches???”

Not if you’re Govmint, Inc.

Y’know, looking at this ACA website cockup, you have to wonder how that can be such a clusterfark, yet the NSA data collection and spying is such a success? Unless it isn’t. SnowDEN!

Comment by 2banana
2014-01-05 08:12:00

Whey are not the congress, senate and president AND ALL FEDERAL EMPLOYEES on obamacare and social security???

Because socialism is for the little people.

Comment by Blue Skye
2014-01-05 08:20:23

They are ahead of the curve. They have already embraced the so-called “single payer”. The single payer is you.

Comment by scdave
2014-01-05 08:21:51

Republicans to Open 2014 With ??

Afghanistan….Mission Accomplished….

Comment by jose canusi
2014-01-05 08:23:45

Afghanistan? Lol, what about Iraq?

Comment by Whac-A-Bubble™
2014-01-05 08:27:24

U.S. can fight al Qaeda in Iraq without troops: Kerry
JERUSALEM Sun Jan 5, 2014 10:22am EST

U.S. Secretary of State John Kerry arrives for a meeting at the presidential compound in the West Bank city of Ramallah January 4, 2014. REUTERS/Brendan Smialowski/Pool

(Reuters) - U.S. Secretary of State John Kerry voiced confidence on Sunday the Iraqi government and tribes would be successful in their fight against al Qaeda, and said Washington was not considering sending troops back to Iraq.

Sectarian and ethnic tensions have risen in Iraq since the U.S. withdrawal in December 2011, inflamed by the conflict in neighboring Syria, where mainly Sunni rebels are trying to oust President Bashar al-Assad, who is backed by Shi’ite Iran.

The Iraqi army has joined forces with local tribesmen to battle al Qaeda, which has teamed up with groups of Syrian rebels to try to create across the Iraqi-Syrian border a state based on strict medieval Sunni Islamic practice.

“This is a fight that belongs to the Iraqis … We are not contemplating returning.” Kerry told reporters during a visit to Israel. “We will help them in their fight, but this fight, in the end, they will have to win and I am confident they can.”

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Comment by Greenshirtwebcamtransient
2014-01-05 09:05:18

They should go on vacation until November.

Comment by Blackhawk
2014-01-05 07:04:14

Billionaires Dumping Stocks, Economist Knows Why - Money News

“It starts with the reckless strategy of the Federal Reserve to print a massive amount of money out of thin air in an attempt to stimulate the economy.

“These funds haven’t made it into the markets and the economy yet. But it is a mathematical certainty that once the dam breaks, and this money passes through the reserves and hits the markets, inflation will surge,” said Wiedemer.

“Once you hit 10% inflation, 10-year Treasury bonds lose about half their value. And by 20%, any value is all but gone. Interest rates will increase dramatically at this point, and that will cause real estate values to collapse. And the stock market will collapse as a consequence of these other problems.”


Comment by jose canusi
2014-01-05 07:44:05

8 Things Liberals Do to Avoid Having an Honest Debate - Broken Down to a Science

“We’ve all been there: Stuck in a hopelessly circular argument with a liberal who won’t get to the point, acknowledge basic facts even exist, or get past juvenile name-calling in debates. It can be really frustrating.

One thing people can do to fight back is just to code all the non-responses to logical or rational arguments. Cryptically flipping back “Give me a break with that number 5 nonsense” or “Man, number 3, again?” can really humiliate people whose stupidity is broken down to a science.”


Personally I prefer the term “lefty”, since I’ve known some very fine, thoughtful “liberals” who don’t knee-jerk. But, whatever works. My fave is #3.

Comment by Greenshirtwebcamtransient
2014-01-05 09:18:07

Thanks, this is good. Let me add number 9:

9. Lie, lie, lie.

(Group allegiance trumps truth).

Comment by Whac-A-Bubble™
2014-01-05 07:51:07

No, Kim Jong Un probably didn’t feed his uncle to 120 hungry dogs
By Max Fisher
January 3 at 11:21 am

If you’ve been on the Internet at all today, you’ve almost certainly seen the story claiming that North Korean leader Kim Jong Un had his uncle executed last month by stripping him naked and feeding him to 120 hungry dogs. The story was first reported by a minor Hong Kong outlet on Dec. 12, was picked up by a Singaporean newspaper on Dec. 24 and since late Thursday has been sweeping through nearly every corner of the U.S. media. The only problem is that it’s probably – probably – not true.

It was indeed a big surprise last month when South Korean intelligence revealed that Kim had purged his own uncle, Jang Song Thaek, which North Korea confirmed a couple of days later with a long screed in its state media. The highly public nature of the purge, which ended with Pyongyang announcing Jang’s execution, was totally unprecedented and legitimately shocking, which is a high bar for North Korea news.

Crazy-sounding stories happen with some frequency in North Korea, where the government has a well-earned reputation for taking political punishments to medieval extremes. But there are five big reasons that this story just does not seem particularly plausible. The fact that the Western media have so widely accepted a story they would reject if it came out of any other country tells us a lot about how North Korea is covered — and how it’s misunderstood.

Comment by Whac-A-Bubble™
2014-01-05 07:56:37

Is it a good financial plan to lock in a “low rate” 30-year-fixed mortgage on an overpriced home? Why?

Wouldn’t it be advantageous to wait until prices return to traditional levels relative to incomes and rents? (I know some parts of the U.S. are already there, but not coastal California.)

Comment by Whac-A-Bubble™
2014-01-05 08:00:51

By U-T San Diego
12:01 a.m. Jan. 5, 2014

Higher mortgage rates for 2014? Count on it. Could this be the year to check out hybrid mortgages, which haven’t been popular lately? Maybe.

You can count on interest rates going higher because:

• The Federal Reserve intends to continue reducing its monthly purchases of mortgage bonds and Treasury securities, which will have the side effect of raising rates.

• The national economy finally appears to be picking up steam, based on the latest quarterly data. Higher growth rates in turn will increase demand for available credit and likely nudge rates higher.

• New federal regulations for mortgage lenders aimed at avoiding another bust take effect Jan. 10. Not only will loan officers and underwriters scrutinize applicants’ income, debt ratios and credit extra carefully, they’ll likely charge more for borrowers whom they see as a higher risk. Some mortgage economists predict that conventional 30-year fixed-rate loans could go to 5.5 percent before year-end.

So what does this mean for you if you’re thinking about buying a house or refinancing and you want to nail down the most favorable interest rate and terms? Should you shop primarily for a traditional mortgage product that guarantees you a specific rate for 15 to 30 years?

Or should you check out what’s also on the shelf in the way of hybrids — loans that provide you a guaranteed fixed rate for a predefined period of time, say five, seven or 10 years — then convert to a rate that can change annually?

The case for sticking with a traditional, fixed-rate mortgage is straightforward. Though 30-year rates are more than a percentage point higher this month than they were a year earlier, they are still not far off multi-decade lows. Bruce A. Calabrese, president of Equitable Mortgage in Columbus, Ohio, is adamant: “My advice for home buyers” in the new year, he says, “is to lock [early] into a 30-year fixed” while rates are still under 5 percent. “Take a 30-year fixed at 4.75 percent and be happy” because that’s still far below average rates over the past several decades.

Paul Skeens, president of Colonial Mortgage Corp in Waldorf, Md., agrees. “If fixed (rates) are under 5.5 percent and you are going to live in your home for five years or more, they are still a great deal,” he says. “I’m very partial to fixed rates since I remember when anything under 7 percent was a great deal.”

Comment by Combotechie
2014-01-05 08:09:48

If you “lock in” a low rate 30-year fixed mortgage then you are locked in for 30 years unless you can sell your home to somebody else. But if interest rates (gasp) rise then you probably will not be able to sell your home to somebody else because the rise in interest rates will cause the monthly payments on your house to rise for somebody else, cause them to rise for the next buyer.

IOW the low interest rates that sucked you in need to remain low if the next buyer of your house is to be sucked in.

Comment by Get Stucco
2014-01-05 08:15:21

“IOW the low interest rates that sucked you in need to remain low if the next buyer of your house is to be sucked in.”

Hopefully the Fed will make good on their pledge to keep interest rates low forever so the new cohort of FBs will always be able to find future buyers funded with cut-rate mortgages.

Comment by Combotechie
2014-01-05 08:20:57

A trend that can’t go on forever won’t.

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Comment by Combotechie
2014-01-05 08:17:13

If markets are distorted because of economic meddling or political meddling (or any other type of meddling) then if/when the meddling is removed the distortion will be removed, and when the distortion is removed the market will reset. And if you are trapped in a market that reset then you just might discover that you are hosed.

Comment by Greenshirtwebcamtransient
2014-01-05 08:26:19

And this is my question, why are the supports being pulled down now? With the FHA limit lowering, qualification income rules tightening, etc., all posted in the last few weeks, it seems that props are being pulled down.




I don’t trust it when government appears to be doing the right thing.

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Comment by Prime_Is_Contained
2014-01-05 08:42:23

And this is my question, why are the supports being pulled down now?

I bet there was a behind-closed-doors agreement back in 2007 or 2008, that they would prop things up for five or six years to cushion the blow, but not prop it up longer than that.

That would explain why sensible actions that we have advocated for five or six years suddenly seem to be happening all of a sudden…

Comment by Whac-A-Bubble™
2014-01-05 08:50:43

PIC — I think you are on the right track. The official mantra is that economic recovery has taken hold, happy daze are hear again, and hence it is high time to take the training wheels off the housing market and let it ride off into the sunset on two wheels.

Comment by Blue Skye
2014-01-05 08:26:42

Debt is a trap any way you slice it.

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Comment by Whac-A-Bubble™
2014-01-05 08:28:33

“And if you are trapped in a market that reset then you just might discover that you are hosed.”

We did our best to warn any potentially FB who would listen.

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Comment by jose canusi
2014-01-05 08:01:09

Anyone have firsthand knowledge of what it’s like to live in Australia? Didn’t we have an Aussie poster on the blog?

Comment by Dudgeon Bludgeon
2014-01-05 19:04:46

What, specifically, are you interested to know?
Australia is very much like the US. Very much.

Comment by Whac-A-Bubble™
2014-01-05 19:06:52

I’ve heard it is like California was before it became overpopulated and overdeveloped.

Comment by 2banana
2014-01-05 08:18:23

No knockout game winners?

I can’t believe Germans are not on her list.

Tiger Mom: Some cultural groups are superior
NY Post | January 4, 2014 | Maureen Callahan

She’s doubling down. Amy Chua, the self-proclaimed “Tiger Mom” who, in 2011, published a book arguing that Chinese women are superior mothers — thus their offspring superior children — has even more to say. In “The Triple Package,” Chua and her husband, co-author Jed Rubenfeld, gather some specious stats and anecdotal evidence to argue that some groups are just superior to others and everyone else is contributing to the downfall of America.

Unsurprisingly, the Chinese Chua and the Jewish Rubenfeld belong to two of the eight groups they deem exceptional. In no seeming order of importance, they are:

Cuban exiles

Comment by Whac-A-Bubble™
2014-01-05 08:21:03

I don’t mean to seem cruel, but who pays to keep legally dead medical patients on indefinite life support? More importantly, doesn’t the practice crowd out valuable medical services available for living patients?

Comment by Whac-A-Bubble™
2014-01-05 08:25:19

Before reading this story in the MSM, I heard an incredulous account over the holidays from my MD BIL.

Jahi McMath’s mother still holds out hope for brain-dead daughter
Nailah Winkfield, mother of 13-year-old Jahi McMath, is comforted by brother Omari Sealey as she talks to the media outside Children’s Hospital Oakland.
From a Times Staff Writer
January 4, 2014, 3:00 p.m.

The family of 13-year-old Jahi McMath hoped to move the brain-dead girl out of an Oakland hospital and into another medical facility after the two sides reached an agreement.

Though a court and hospital officials say Jahi is brain dead, her mother, Nailah Winkfield, still holds out hope and claims the girl is “improving.”

“I will always fight for Jahi until she is ready to go, her own self. I can’t play God. She’s going to get better or she’s not, but I see her getting better,” Winkfield told reporters Friday night, according to the San Francisco Chronicle.

Comment by jose canusi
2014-01-05 08:26:45

You’re not being cruel at all. I’ve wondered the same things myself. Must be money in it for someone. I recall the whole Terry Schiavo cockup here in Florida. What’s cruel was how that poor woman was kept in a vegetative state. Her body became nothing but a game piece in the tug of war between her husband and her parents.

Comment by Whac-A-Bubble™
2014-01-05 08:33:42

“Must be money in it for someone.”

Fawkin’ attorneys!

Comment by jane
2014-01-05 14:46:56

The money goes to the bloodsucking lawyers.

Comment by Blue Skye
2014-01-05 08:28:43

You can avoid being a burden on the rest of us by filing a health proxy.

Comment by Lemming with an innertube
2014-01-05 09:39:56

13 year olds?

Comment by Blue Skye
2014-01-05 10:15:27

The article hadn’t posted when I responded to the teaser.

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Comment by Lemming with an innertube
2014-01-05 11:18:02

agree with you. and I believe the financial onus should be on the party that wants to keep a brain dead person on life support indefinitely.

Comment by Whac-A-Bubble™
2014-01-05 11:21:33

“…and I believe the financial onus should be on the party that wants to keep a brain dead person on life support indefinitely.”

And I’m guessing that if that were the case, there would be no effort underway to move Jahi McMath out of the Oakland hospital where she died.

Comment by 2banana
2014-01-05 08:44:37

Bring out the Death Panels!

What could go wrong?

It will be run by the same people who run obamacare…

Comment by Whac-A-Bubble™
2014-01-05 08:51:51

Nice try, but wrong meme for this discussion.

Comment by Whac-A-Bubble™
2014-01-05 08:48:33

It sounds like the move to get Jahi McMath out of the hospital has something to do with the legal question of where she died. The hospital already declared her legally dead, but several comments in the story posted below suggest that an effort is underway to get her out of the hospital in order to create the false appearance that she did not die there, which has implications on whether the damages for pain and suffering would be capped at $250,000. Perhaps if the attorneys working diligently behind the scene to propagate a lie could make it stick, they could get a slice of a far larger settlement than $250,000! Despicable…

Dan Morain: Jahi McMath case is rife with tragedy and politics
By Dan Morain
Published: Sunday, Jan. 5, 2014 - 12:11 am

Jahi McMath could be any parent’s daughter.

The 13-year-old eighth-grader went into Children’s Hospital in Oakland for a tonsillectomy on Dec. 9. By Dec. 12, doctors determined she was brain dead, the result of severe blood loss after surgery. They sought to remove all life support, against the wishes of Jahi’s mother, Nailah Winkfield.

For three weeks, the case has played out in news accounts and in courts, as the parents sued to stop the hospital from pulling the plug. On Friday, the sides apparently compromised by agreeing that Jahi could be transported to a nursing home where she would be maintained on life support.

The case is hardly over.

Plaintiffs’ lawyers, their proxies and victims of medical negligence are pushing an initiative for the November ballot that would alter California’s 38-year-old medical malpractice law, the Medical Injury Compensation Reform Act. Under that law, which was signed by young Gov. Jerry Brown, damages for pain and suffering in a medical malpractice case are capped at $250,000. The initiative would quadruple that amount.

The case is rife with subtext. One is cost. The Affordable Care Act will provide health coverage for millions of previously uninsured people but does nothing to curb rapidly rising health care costs, probably its greatest omission. The health care industry will argue that any change in California’s medical malpractice law will jack up health care costs. Doctors will threaten to flee the state. Plaintiffs’ lawyers will scoff. Both sides will spin. There will be plenty of emotion, and talk of Jahi McMath.

The girl came to the public’s attention on Dec. 15 when the Contra Costa Times reported on her family’s fight to stop the hospital from pulling the plug.

By Dec. 18, Jamie Court, head of the Santa Monica-based advocacy group and initiative promoter Consumer Watchdog, called on Attorney General Kamala Harris, the California Medical Board and the Alameda County district attorney to investigate.

“As you probably know,” Court wrote to the authorities and to the rest of us, “in a case where negligence is suspected, California law makes it highly advantageous for the medical providers and facilities involved if children die in hospitals rather than live a lifetime with catastrophic injuries and significant medical costs.”

“Under a 38-year-old law, the Medical Injury Compensation Reform Act (MICRA), that has never been indexed for inflation, the most a family can recover in court for the loss of a child is $250,000, no matter how egregious the malpractice. By contrast, the hospital would be responsible for a lifetime of care and caretaking, if the patient lives. In the hospital’s rush to terminate Jahi’s life, this conflict of interest was no doubt never explained to the family.

Last week, Court took went over the top. In one of the tackiest fundraising appeals I’ve ever seen, Court’s email blast opened by saying: “Consumer Watchdog’s patient safety project fights for families like Jahi’s. We’re working to expose medical negligence and save lives. Please help our fight with a tax-deductible contribution.”

The connection between the fundraising appeal and the coming initiative fight was obvious.

With Court and others throwing elbows, the hospital retained the crisis communications firm Singer Associates. Headed by Sam Singer, the company’s website says: “Singer’s nickname – The Fixer – says it all.” The site makes quite the boast: “If your reputation, fortune or political future is at stake, this is the agency you call to convince the public, the politicians or the judge that you’re in the right.”

“Doctors treat people and make them better. They don’t argue. They asked us to assist,” Singer said, and proceeded to attack the family’s lawyer, Christopher B. Dolan: “Dolan wants to make this about MICRA … He wants more than $250,000.”

I know Dolan. He was president-in-waiting of the Consumer Attorneys of California in 2009 when I worked for the trade group. He is a hard-driving, motorcycle-riding workaholic who is very smart. You wouldn’t want to be on the receiving end of a Dolan lawsuit. In the campaign to alter MICRA, Dolan will be a combatant, as will the organization he headed.

Dolan told me he made clear the situation to Jahi’s mother: “There is little if any hope here. There is a bleak road ahead.” Still, she wanted her daughter kept alive.

“If this family wanted to terminate, and hospital opposed it, I would fight just as hard,” Dolan said. “It is about who gets to make the decision, the hospital or the parents.”

Comment by Whac-A-Bubble™
2014-01-05 10:32:31

“Still, she wanted her daughter kept alive.”

Is there any scientific debate whatever over whether brain dead individuals can be resurrected? If not, why is this journalist pandering to an alternative version of reality?

Comment by tresho
2014-01-05 13:56:23

Is there any scientific debate whatever over whether brain dead individuals can be resurrected?
It all depends on what the definition of “dead” is. This family doesn’t agree with the legal definition.

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Comment by Whac-A-Bubble™
2014-01-05 15:41:20

“This family doesn’t agree with the legal definition.”

Does every family get to make up its own definition, independent of what science says about the potential for coming back to any meaningful state of living?

What does the statistical evidence suggest? There must have been thousands and thousands of people to enter brain-dead status over the past century of automobile use, including serious or fatal accidents. How many of those who ever were declared brain dead came back to live in a none-brain-dead state of existence?

Comment by Rental Watch
2014-01-05 17:54:11

You can be ALMOST certain of one thing…it’s not the family of the patient.

As such, it ends up being the rest of us, one way or the other.

1. If the hospital eats the cost, they need to charge other patients more (hospitals don’t make any money).

2. If it’s insurance, they’ll jack up premiums for everyone.

3. If it’s Medicare, it’s all taxpayers.

One MAJOR reason for the difference in healthcare cost between single payer European countries and the US is how end of life issues are dealt with…there, doctors say “no”, and the money isn’t spent. Here, we spend lots of money in the same circumstances. Take out these expenditures, and the gap between spending shrinks considerably.

Comment by Whac-A-Bubble™
2014-01-05 18:21:55

Also don’t forget that someone on the border between life and death may need that bed and the medical care given to its deceased occupant.

Comment by Whac-A-Bubble™
2014-01-05 18:31:17

McMath lawyer: Plan is in place to move Jahi by Tuesday
Carolyn Jones
Updated 4:05 pm, Sunday, January 5, 2014
File - This undated file photo provided by the McMath family and Omari Sealey shows Jahi McMath. The family of a 13-year-old California girl who was declared brain dead after a tonsillectomy said Monday they will sue to keep her on life support. Family spokesman Omari Sealey, the uncle of Jahi McMath, disclosed the plan to seek a restraining order against the hospital where the girl is on a breathing machine. Under an order issued on Dec. 24 by a state judge, Jahi could be removed from a ventilator at Children’s Hospital of Oakland at 5 p.m. PST. (AP Photo/Courtesy of McMath Family and Omari Sealey, File) Photo: Uncredited, Associated Press

(01-05) 15:58 PST — Jahi McMath will move out of Children’s Hospital Oakland and into a new facility before 5 p.m. Tuesday, the court-ordered deadline preventing the hospital from disconnecting the brain-dead teen from a ventilator, her family’s attorney said Sunday.

Christopher Dolan, speaking on a local television station, said Jahi is alive and he has a plan in place to move her.

“I have the medical staff, the facility, the transport … Wheels are in motion. We have a clear path,” he said. “I have everything in place. We just need to get it all in motion. And come hell or high water, that’s what I’m going to do.”

He declined to name the facility or other details about the transfer.

A spokesman for the hospital said staff had not heard of any imminent plans to relocate Jahi’s body.

“We take him at his word,” said spokesman Sam Singer on Sunday. “He’s had 12 days to find a place for her and nothing has worked out. We hope this time it does.”

Jahi, 13, has been at Children’s Hospital Oakland since Dec. 9, when she went in for surgery on her tonsils, adenoids, uvula and palate tissue to treat sleep apnea.

Following surgery she suffered cardiac arrest, her family said, and two doctors pronounced her brain dead, meaning that her brain and brain stem have irreversibly ceased functioning.

A third doctor, a Stanford neurologist appointed by a court, confirmed the diagnosis 12 days later.

The Alameda County coroner’s office issued a death certificate on Friday, listing Dec. 12 as the girl’s date of death.

Jahi’s family and her attorney do not believe the girl is dead, citing her beating heart and occasional movements.

“She’s not passed,” Dolan said Sunday. “Her heart beats. Her kidneys function. She regulates her body temperature. … She should not be treated as a dead person.”

Comment by Whac-A-Bubble™
2014-01-05 18:39:42

This writer pretty much nails the situation, a ready-made opportunity for attorneys to exploit.

Daniel Borenstein: Mischaracterizations of Jahi’s condition ignites insane legal fight
By Daniel Borenstein
Contra Costa Times columnist
Posted: 01/03/2014 04:00:00 PM PST | Updated: about 6 hours ago

One can only imagine the shock Nailah Winkfield felt when she saw her 13-year-old daughter in the intensive care unit, recently out of surgery, bleeding from the mouth.

Nurses told her “it was normal,” according to her attorney’s account. They gave Winkfield a container to capture the copious amounts of blood coming from her girl’s mouth and nose. Winkfield asked for a doctor, but was only given a bigger container and a suction device.

Jahi McMath had undergone tonsil surgery and two other procedures to remove tissue from her nose and throat. She soon suffered a heart attack. On Dec. 12, three days after her surgery, hospital doctors declared her “brain dead.” A machine keeps her heart beating, but she is not alive.

Unfortunately mischaracterizations of her condition have helped turn this tragedy into an insane legal fight, still playing out Friday, and a politically charged national debate.

We learned on Tuesday that the Terri Schiavo Life & Hope Network has been working behind the scenes to help the family find a place to transfer the girl. “Jahi McMath has been labeled a ‘deceased’ person. Yet she retains all the functional attributes of a living person, despite her brain injury,” the organization said.

Sadly, that’s not true. We’re not talking about someone in a coma. We’re also not talking about Schiavo, the Florida woman in a persistent vegetative state who was the center of a seven-year fight over whether to keep her alive. Jahi’s condition is much worse. Unlike Schiavo, in Jahi’s case, there is no brain function.

The sudden loss of a child — within the confines of a hospital, no less — would devastate and traumatize any parent. The overwhelming emotional blow would understandably trigger Elisabeth Kübler-Ross’ grief stages, starting with denial and anger.

Winkfield is no exception. Unfortunately those around her aren’t helping. Instead, they seem to be reinforcing false hope. Winkfield is being misled by the Schiavo Network; her attorney who keeps battling to keep the respirator running and move Jahi to a care facility; and members of the media who repeatedly describe the machine as “life support.”

Alameda County Superior Court Judge Evelio Grillo had temporarily blocked the hospital from shutting it off. On Friday, with a Tuesday deadline looming, the two sides reached agreement allowing a care team to remove the girl from the hospital, while remaining on a ventilator, and take her to an undetermined location — provided Winkfield assumes full responsibility.

Winkfield’s attorney, Christopher Dolan, had argued that if the hospital turned off the machine, Jahi would suffer “irreparable harm.” He cited cases finding that individuals, or their guardians, have a right to determine their medical treatments, even if they might lead to death.

Thus, he had argued to the state Court of Appeal, “if a person has a constitutional right to end their life they have an equal, if not greater right to undertake measures to prolong their life.”

But Jahi has no life to prolong. That was established by not only the hospital’s physicians, but also Dr. Paul Fisher, chief of child neurology at Stanford, who was appointed by Grillo to provide an independent evaluation.

Keeping Jahi on a respirator will not bring her back. So there would be no “irreparable harm” in removing it because the worst outcome has already occurred.

Unfortunately, some news reporting contributes to the misunderstandings.

Comment by 2banana
2014-01-05 08:24:14

11 Nasty Trends That Will Test America’s Resilience
Investors Business Daily | January 3, 2014

The resilience that has long been one of America’s remarkable traits was on display in 2013. Not only did businesses create 2 million jobs, but the struggling economy actually grew and profits and stock prices soared to near-record levels.

Still, five years into the Obama presidency, the economy is grossly underperforming. Contrary to the dominant media narrative, it’s not bad luck or the financial crisis to blame, but bad policies — from the $860 billion “stimulus” that didn’t stimulate to the Dodd-Frank financial reform that killed lending.

Last year was a challenging one for entrepreneurs and other productive Americans. No fewer than 13 new taxes were put into place. Big government now consumes one of every four dollars of our GDP and is getting bigger.

Entering 2014, we face problems, including taxes and spending, that neither the White House nor Congress is addressing. In the following charts, we look at a few of the more alarming and intractable ones.

The 11 Nasty Trends:

Extremely Limited Prosperity
A Wide Economic Growth Gap
A Massive Ongoing Jobs Gap
Dependency Growing, Not Jobs
America’s Global Strength Wanes
Workers Leave Labor Force
America, The Biggest Debtor Ever
Real Jobless Rate? Double Digits
Regulation Is Huge Hidden Tax
What America Really Owes
Long-Term Fiscal Outlook Is Ugly

Comment by 2banana
2014-01-05 08:27:49

The real war against women.

Where is NOW and Code Pink?

Where are the democrats?

Where is Cindy Sheehan?

obama has had 5 years in Afghanistan. How can this be?


Violence against Afghan women more frequent, brutal in 2013: official
Reuters | 1/4/2014

Violent crime against women in Afghanistan hit record levels and became increasingly brutal in 2013, the head of its human rights commission said on Saturday, a sign that hard won rights are being rolled back as foreign troops troops prepare to withdraw.

Restoring fundamental women’s rights after the Taliban were ousted by a U.S.-led coalition of troops in 2001 was cited as one of the main objectives of the war.

Under the Taliban, women were forced to wear the head-to-toe covering burqa and barred from leaving their homes without being escorted by a male relative. Schools for girls were shut down.

Sima Samar, chair of the Afghanistan Independent Human Rights Commission (AIHRC), told Reuters in a telephone interview that the brutality of attacks on women had greatly intensified.

“The brutality of the cases is really bad. Cutting the nose, lips and ears. Committing public rape,” she said. “Mass rape… It’s against dignity, against humanity.”

Comment by Whac-A-Bubble™
2014-01-05 09:02:55

“obama has had 5 years in Afghanistan. How can this be?”

If only there were a Retardican prezident, this would be unpossible.

Comment by Greenshirtwebcamtransient
2014-01-05 08:41:21

Here’s the thing. I don’t need to be a millionaire. I don’t need to rule the world. I just want a decent house for my family and I to live in that is in line with my income and what it could buy only a few short years ago. I’d like to be able to live in the same area as co-workers who make the same salary. Nice neighborhoods with good schools fairly close to work.

Guess what, that option is not affordable now. If you happened to buy 10-15 years ago, you get to live in a much bigger house in a nicer neighborhood closer to work. Nothing changed but the mania. Salaries didn’t go up. New employers didn’t move in. Demographics didn’t change. Lucky timing.

I might have been able to jump in around late 2011 to mid 2012, but life circumstances made me not want to buy then. Also it seemed that a lot of the deals during that time were going to insiders or to those in on some sort of scam I didn’t know about.

I guess I’m lucky too though, I got priced out in SoCal in 04-05 when I was considering buying. Buying then would have been the worst financial decision of my life.

Comment by 2banana
2014-01-05 08:53:25

If you happened to buy 10-15 years ago, you get to live in a much bigger house in a nicer neighborhood closer to work. Nothing changed but the mania.


Plenty has changed in the last 15 years.

Government took more and more control of housing to make things “fair.”

How did it work out for you?

You think even bigger government will make things even better?

Comment by greenshirtwebcam
2014-01-05 12:46:04

I bet there was a behind-closed-doors agreement back in 2007 or 2008, that they would prop things up for five or six years to cushion the blow, but not prop it up longer than that.

That may be, but what do they care about the pain for the masses, how does it gore their ox to keep prices propped up? Or put another way, what is in it for them to pull down the props now?

Without there being some benefit that I don’t currently see, why pull away the punchbowl? Whats the endgame to doing it?

Comment by greenshirtwebcam
2014-01-05 12:52:35

I do not want bigger government. I’d like to see it out of housing entirely, except for prosecuting fraudsters. But government taking more and more control wasn’t the reason people I work with were able to buy way cheaper 10-15 years ago. They aren’t subprime borrowers. They have good incomes and good jobs.

I know there were changes made to loosen up standards, allow crazy borrowing and then to not require losses to be recognized after the crash, but it was the mania of the public treating houses like beanie babies that was far and away the biggest driver. Jacking up what people can borrow doesnt mean they have to borrow that amount. I didn’t and many others here also did not.

Comment by Whac-A-Bubble™
2014-01-05 15:46:14

“But government taking more and more control wasn’t the reason people I work with were able to buy way cheaper 10-15 years ago. They aren’t subprime borrowers. They have good incomes and good jobs.”

What is ‘affordable housing’ policy if not a government-engineered attempt to give select groups of individuals which the government deems ‘more worthy’ a leg up in the competition for housing over other groups which the government deems ‘less worthy’?

If you want to become a beneficiary of ‘affordable housing’ programs, you should figure out how to become a member of one of these ‘more worthy’ groups of Americans and join.

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Comment by greenshirtwebcam
2014-01-05 17:48:27

RE: affordable housing policy

I don’t advocate for that and didn’t mention it. The government should get out of housing or at least go back to how it was before the started the recent meddling (pre 2000 or so).

I don’t buy the blame for the bubble going to those affordable housing policies though. I think they were only a small part of it < 10%.

Comment by Whac-A-Bubble™
2014-01-05 08:55:37

“I just want a decent house for my family and I to live in that is in line with my income and what it could buy only a few short years ago.”

People like you were the primary marks for the wanksters who orchstrated the Housing Bubble scam operation!

Comment by Whac-A-Bubble™
2014-01-05 09:00:47

“If you happened to buy 10-15 years ago,…”

I didn’t overthink it, but looking back, I suppose the reason there were so many attractive places for sale two decades ago when my newlywed wife and I bought our first home was that the economy was in a terrible place, with high unemployment and many families losing their homes. The misfortunes of older homeowners who lost their jobs looked like opportunity to young families just getting started.

But I don’t believe all the myriad top-down interventions to hold homes off the market, indefinitely postpone foreclosures, or sell empty homes to investors were in play back then, as I never saw any comparable point to the early-1990s market over the past five years when there was an abundance of choice for would-be home buyers. This time around, the older generation got protected while the younger generation got hosed.

Comment by Prime_Is_Contained
2014-01-05 09:43:41

But I don’t believe all the myriad top-down interventions to hold homes off the market, indefinitely postpone foreclosures, or sell empty homes to investors were in play back then, as I never saw any comparable point to the early-1990s market over the past five years when there was an abundance of choice for would-be home buyers. This time around, the older generation got protected while the younger generation got hosed.

GREAT summary, PB.

It turns out we were all wrong back in 2006—this time really WAS different!

The PTB decided to prevent economic forces for correcting the imbalances naturally, and in the process, they screwed over a different demographic than would naturally have occurred.

Comment by greenshirtwebcam
2014-01-05 12:58:44

There seems to be a lot of that happening, from pension reform, to housing, to jobs, to medical costs and on and on.

Generational theorists Strauss and Howe predicted the clash between Boomers and Xers back in the early 90s. I’ll have to look it up again, but I think it was supposed to be coming to a head right about now as the social security and medical costs for the Boomers start to need paying bigtime.

Comment by rms
2014-01-05 09:54:24

“I guess I’m lucky too though, I got priced out in SoCal in 04-05 when I was considering buying. Buying then would have been the worst financial decision of my life.”

+1 Nicholas Cage would likely agree with you.

Comment by Whac-A-Bubble™
2014-01-05 10:21:56

It’s a fantastic tale of real estate investing woe which illustrates how even very wealthy people got caught up in the mania. I’d be interested in the complete version if anyone has a link.

Actors & Actresses
Nicholas Cage’s Former Malibu Ranch Sells For $6.3 Million
Posted by Cristin | November 14, 2013 | 9:38 am |
Tags: Actor, Bankrupt, Bankruptcy, celebrity real estate, Financial ruin, Lawsuit, Malibu, Nicholas Cage, Ranch

Nicholas Cage‘s former ranch in Malibu has just found a new buyer!

The deal closed on November 7, 2013 for $6,300,000, as first reported by the LA Times. That’s a far smaller sum than the $10,300,000 ”The Rock” actor paid for the Malibu spread in 2000. The seller is clothing designer Masud Sarshar.

When Cage owned the property, he first tried to sell it for $23 million, and from there, the asking price kept trending downward. While the land didn’t fetch $23 million, it’s worth a pretty penny, as its one of the largest land-holdings available in Malibu. Just minutes off the Pacific Coast Highway, the 3 parcel property has lakes, cattle and horses. Existing structures on the land include an indoor garden, a caretakers residence, horse pasture, and 2-bedroom and a 2-bathroom guest house with luxurious amenities tucked in a beautiful grove of oak trees. The property boasts its own extensive network of horse trails and boarders the Santa Monica Mountains’ network of trails.

The sale of this ranch reminds us of Cage’s many real estate woes. In 2009, when the IRS came after him for unpaid taxes that totaled more than $13 million, he had just completed a massive land grab for high-priced real estate that included a private island in the Bahamas, a Medieval castle in Germany, a country manor in Rhode Island, a castle in England, a haunted estate in New Orleans and more. His list of properties and high-priced possessions – like nine Rolls Royce vehicles, a prehistoric dinosaur skull, and exotic snakes – could really go on and on.

Notably, he first listed the former Tom Jones/Dean Martin mansion at 363 Copa De Oro Road in Bel Air for $35 million, but ultimately sold through bankruptcy for $10.4 million.

As Cage’s financial woes became public, he famously sued his business manager, Samuel Levin, alleging negligence and fraud. Levin counter-sued, stating that he warned Cage that he was living way beyond his means and urged him to spend less. Levin’s filing states that “instead of listening to Levin, Cage spent most of his free time shopping for high ticket purchases, and wound up with 15 personal residences.”

Comment by In Colorado
2014-01-05 11:34:35

Here’s the thing. I don’t need to be a millionaire. I don’t need to rule the world.

The problem is that the type A, Alpha, sociopath jerk holes do, and if they have to squash you like a bug to accomplish it they will.

Comment by Bill, just South of Irvine
2014-01-05 14:55:04

“I don’t need to be a millionaire.”

To retire, you most certainly do. That is, if you are now under the age of fifty. You expect social security to be there for you? ObamaScare is a scam and is going to raise the insurance costs on all of us to pay for those that were not insured before. Let’s say $12,000 per year insurance within ten years. And if you expect to draw on your retirement for twenty years at $50,000 per year, you are going to be in for a huge price shock. Even if you retire to Kansas.

Comment by azdude02
2014-01-05 15:26:26

it has become clear to a lot of people that there will be no retirement and they are content on getting on the free stuff bandwagon.

Comment by Avocado99
2014-01-05 18:10:57

Was insurance a deal before O-Care?

Keep working on it until there is more competition and prices drop. Don’t quit and go back to 2006.

Doing nothing is not the solution.

Comment by Whac-A-Bubble™
2014-01-05 09:23:43

Comment by Prime_Is_Contained
2014-01-05 05:38:57

With so many folks out there who “know” a stock market bubble is forming, is it even possible for one to form?

Seems unlikely, doesn’t it? I think of a bubble as requiring the psychology of denial, but perhaps my mental definition is flawed.

I’m unconvinced that one narrow line of thinking exclusively supports bubbles. For instance, note that every bubble of historical importance appears to have included a group of knowledgeable participants who were fully cognizant of the unsustainable price movements underway, but who jumped in to ride the bubble up on the assumption that they would be able to cash out before the crash. One of the best examples of this type which comes to mind is that of Sir Isaac Newton, who lost a fortune in the South Sea Bubble, after which he said, “I can calculate the movement of the stars, but not the madness of men.”

Another one is Groucho Marks, whose character Hammer in the 1929 movie The Cocoanuts makes light of underwater investors in Florida real estate: “You can get any kind of house you want; you can even get stucco. (Boy can you get stucco!)” Sadly, Groucho missed the parallel between the Florida land bubble and the Wall Street stock market bubble, and managed to lose himself a bundle during the Great Crash.

Comment by Prime_Is_Contained
2014-01-05 09:46:08

One of the best examples of this type which comes to mind is that of Sir Isaac Newton, who lost a fortune in the South Sea Bubble, after which he said, “I can calculate the movement of the stars, but not the madness of men.”

Was Newton really in-the-know that it was a bubble, but thought that he could get out in time? Or was he a bubble true-believer?

Being intelligent does not necessarily guarantee that one will recognize a bubble, IMHO.

Comment by Whac-A-Bubble™
2014-01-05 10:24:41

As I recall the story, Newton managed to sell his South Sea Bubble holdings before the first major leg down, thereby pocketing a fortune. However, he was lured into buying the dead cat bounce, which preceded the second leg down when he lost a fortune. It was after this schooling in life’s dear school for fools that he offered his observation on the madness of men.

I expect many who bought the dead cat bounce after the 2007-08 housing market correction await a similar fate.

Comment by In Colorado
2014-01-05 12:15:54

Greed is powerful. I recall a story some years ago about a guy who won about 100M in the lottery (after taxes IIRC). Now when you think about it, even if you spent 1 million a year, that stash would last 100 years. But this guy said that he wanted to convert it into a billion or more. 100M wasn’t enough, he wanted to be a master of the universe. I have no idea of what his outcome was.

I suppose it could have been worse, he didn’t waste it on blow or hookers.

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Comment by rms
2014-01-05 10:00:06

A great time to sell [your] shares is when the feckless are borrowing to buy [their] shares.

Comment by cactus
2014-01-05 09:55:11

SEATTLE/NEW YORK (Reuters) - Boeing’s machinists on Friday narrowly approved a crucial labor contract that secured thousands of jobs and billions of dollars of economic activity for Washington state but will cost workers their pensions.

The vote of 51 percent to 49 percent to accept the deal means Boeing Co will build its new 777X jetliner and wings in the Seattle area, where Boeing has built aircraft for more than 90 years.

Comment by Whac-A-Bubble™
2014-01-05 10:04:00

Is it common knowledge that
1) the reason Wall Street did so great in 2013 was due to QE3?
2) the current Fed’s game plan is to spike the punchbowl as much and often as possible?
3) this party will go on forever?

Comment by Whac-A-Bubble™
2014-01-05 10:07:27

Sunday Journal
Mutual Funds Can Ride the Market Up in 2014
Wall Street Pros Say Stocks Could See Another Impressive Year
By Gregory Zuckerman
Jan. 4, 2014 8:36 p.m. ET

The stock market shocked investors in 2013 with huge gains. It could happen again in 2014 as long as corporate earnings cooperate.

A year ago, a poll of 11 top Wall Street strategists predicted the S&P 500 would rise just 8.2% in 2013, not including dividends, according to research firm Birinyi Associates. Instead, the U.S. stock market scored its best gains in 16 years, as the Dow Jones Industrial Average rose 27% and the S&P 500 jumped 30%.

Credit for the heady gains goes to low interest rates and efforts by the Federal Reserve to pump money into the economy, encouraging investors to make more aggressive bets.

An improving housing market and resilient U.S. economy also helped.

The gains came even though U.S. gross domestic product is estimated to have grown just 1.7% and corporate profits likely rose 5.7% in the year, according to FactSet Research.

The bond market came under more pressure—the Barclays US Aggregate Bond Total Return Index fell over 2% in 2013 as investors began anticipating a shift by the Fed to reduce its bond purchases.

In 2014, the Fed is expected to continue reducing its bond buying, which could push up interest rates. But unless rates shoot much higher, stocks could see another impressive year, analysts say, thanks to continued economic growth and improving corporate profits.

It helps that stocks aren’t at expensive levels, though they’re also not cheap. The S&P 500 trades at about 15 times expected earnings over the next year. Given how low interest rates are, some investors think that’s a reasonable price to pay.

As the Fed pulls back from its easy-money policies, further gains likely will depend on continued earnings growth, which is expected to rise about 6% in 2014.

There are other reasons for bullishness, such as record levels of stock buybacks and dividend increases. The housing market continues to strengthen and retail sales and business spending could keep strengthening. And the U.S. has emerged as the world’s largest energy producer, lowering costs for a range of businesses and helping to restrain inflation.

“We see this stellar performance in the middle of the year as a sign that the underlying pace of economic growth is healthy,” says Citigroup economist Peter D’Antonio, who predicts the economy will grow “around 3%” in 2014.

The Fed will continue to treat the market with kid gloves,” says Darren Pollock, portfolio manager at Cheviot Value Management. “This Fed is focused on finding ways to refill the punch bowl so that the party never stops.”

AllianceBernstein has been shifting its portfolios toward so-called cyclical shares, especially retail stocks and other “consumer-discretionary” stocks, betting that the economy will improve. Some analysts recommend the SPRD S&P Retail exchange-traded fund (XRT), which owns retail stocks such as Groupon and Supervalu.

“The bears would like you to believe that we are in a U.S. stock-market bubble,” says Alan Zafran, managing director of First Republic Investment Management. But he’s more upbeat, citing strong corporate balance sheets, a Fed that has promised to keep rates low, and reason to think more individual investors will shift to stocks.

Reasons for concern remain, however. A growing number of companies in the S&P 500 are issuing earnings estimates for the fourth quarter below analyst estimates.

And James Paulsen, the usually bullish chief investment strategist at Wells Capital Management, argues that U.S. and global economic growth “will quicken more than most anticipate,” leading to worries about rising interest rates and a pause in the stock surge.

The market is extended,” says Uri Landesman, president of hedge-fund firm Platinum Partners. “Bullishness is way too rampant.”

What Could Possibly Go Wrong?

Here are a few potential surprises that Wall Street pros will be on the lookout for in 2014:

Taper Panic: Faster-than-expected growth could send the bond market tumbling while keeping a lid on stocks, amid worries that the Federal Reserve may need to act more aggressively to hike interest rates.

Stock Scramble: If there’s been one lesson of recent years it’s that financial markets move to extremes. While markets are reasonably priced, more good news and low interest rates could spark a scramble by investors to get their hands on stocks.

Recession Replay: Economic downturns seem to occur every seven or eight years. It’s been six years since the 2008 crisis. This year may see early concerns that the next recession is around the bend, one that central banks are in a weaker position to deal with.

Comment by Whac-A-Bubble™
2014-01-05 10:28:07

Given the Fed’s ongoing concern with keeping the punch bowl fully spiked, I find concern that they might some day take away the punch bowl unwarranted.

Comment by Whac-A-Bubble™
2014-01-05 10:29:39

The world economy in 2014
Why optimism may be bad news
Good news about global growth risks pushing interest rates up and politicians’ appetite for reform down
Jan 4th 2014 | From the print edition

ALMOST every year since the end of the financial crisis has started with rosy expectations among American forecasters, and this one is no different. Stockmarkets are buoyant, consumer confidence is improving, and economic seers are raising their growth forecasts for 2014. America’s S&P 500 share index is at a record high, after rising 30% in 2013—the biggest annual gain in almost two decades. Powered by America, global growth of close to 4%, on a purchasing-power-parity basis, seems possible. That would be nearly a full percentage point faster than 2013, and the best showing for several years.

Yet amid the new-year cheer, it is worth remembering that almost every year since the financial crisis upbeat expectations have been disappointed. The biggest danger this time round is the optimism itself.

All around the rich world, things are looking better. Britain’s recovery is gathering pace (see article). Japan’s economy seems strong enough to cope with the imminent rise in its consumption tax. Even Europe’s prospects are less dismal. But America is driving this recovery.

America’s growth rests on strong foundations. First, household and corporate balance-sheets are in good shape. Unlike Europeans, who have barely reduced their private debt, Americans have put the hangover from the financial crisis behind them. The revival in house prices is testament to that. Second, thanks to cheap energy, years of wage restraint and a relatively weak dollar, America is competitive. These two factors have combined to produce faster job growth which, along with higher share prices, suggests stronger consumer spending and higher investment ahead. Finally, the fiscal squeeze is abating. In 2013 the federal government took 1.75% of GDP out of the economy with tax rises and spending cuts. The recently agreed budget deal will help cut the fiscal squeeze to 0.5% of GDP this year. All these factors could boost America’s growth to around 3% in 2014, well above its trend rate.

More spending by American firms and households will, in turn, buoy demand for goods and services from everywhere from China to Germany. America’s appetite for foreign wares is not what it once was (the current-account deficit has fallen to a 15-year low of 2.2% of GDP, see article), but its economy is so big that faster spending will push up exports around the globe. The resulting support for growth will, in turn, improve domestic confidence from Europe to Japan.

The trouble is that trade channels are not the only, or even the main, way in which America’s economy affects the rest of the world. Financial markets are a more powerful influence, as today’s share-price surges prove. As America’s economy gains strength, investors may expect the Federal Reserve to bring forward its first rate rise from the expected date of mid- 2015. That could send bond yields sharply higher.

Fed officials have made it clear that, even though the pace of bond-buying will slow, they are in no hurry to raise rates. But the faster the economy grows, the likelier investors are to doubt that commitment. In Britain, speedy growth has already led to expectations that the Bank of England will raise interest rates, even though it insists that it has no intention of doing anything of the sort. If faster growth in America translates into sharply higher bond yields, it could undermine itself. And, given the Fed’s influence over global monetary conditions, it could clobber growth elsewhere too.

Comment by Whac-A-Bubble™
2014-01-05 10:52:21

12:53 pm Dec 23, 2013
Happy Birthday, Federal Reserve! Have Some Punch (Before the Bowl Gets Taken Away)
By Paul Vigna

One hundred years ago on this day, President Woodrow Wilson signed the bill that brought to life the Federal Reserve Board. Through war, depression, market panics and crashes, and raging bull markets, the Fed has been tasked with keeping the nation on an even keel.

It hasn’t been the easiest of jobs. The Fed itself was a reaction to the panic of 1907, and faced its first real test (and failed, in the eyes of many, including the current Fed chairman) in the crash of 1929. It is still in the midst of working through its latest test.

Throughout its long history, though, one of the best defenses of the Fed, and best descriptions of its job, came from the 1955 “punch-bowl” speech by William McChesney Martin, who ran the central bank for a record 19 years (1951-1970).

There are several things that are striking about the speech, reading it today. For one thing, Mr. Martin was delivering it to a group of New York investment bankers, and he was basically telling them not to count on the Fed making their lives easy with cheap money.

But the speech also touches on so many issues that are at the crux of today’s economy. Is a jobs market built on “creeping inflation” desirable, or a sign of maladjustment? Can monetary policy be the sole underpinning of a healthy economy? In free markets, must failure be allowed to flourish as well as success? Is there a difference between free and rigged markets? What’s the proper role of government and sound budgeting? What responsibility do we have toward one another, not just as businesspeople and investors, but as citizens?

It’s a brilliant, thought-provoking speech, for Mr. Martin ultimately isn’t talking about just the Federal Reserve, but the responsibility that the Fed, the government, and the business sector all have in producing a healthy, sound, growing economy. They must, in fact, all work together, he says. It’s not a sentiment heard often enough today.

So in honor of the central bank’s birthday, we present the “punch-bowl speech.” (In case you want to skip ahead, the metaphor is in the second-to-last paragraph.) Happy birthday, Federal Reserve. May you have many more.

In the field of monetary and credit policy, precautionary action to prevent inflationary excesses is bound to have some onerous effects — if it did not it would be ineffective and futile. Those who have the task of making such policy don’t expect you to applaud. The Federal Reserve, as one writer put it, after the recent increase in the discount rate, is in the position of the chaperone who has ordered the punch bowl removed just when the party was really warming up.

– William McChesney Martin

Comment by Whac-A-Bubble™
2014-01-05 10:59:10

Some regular posters have recently suggested that immigration will save the U.S. housing market from suffering a similar fate to Japan’s. I’m missing the evidence.

Sluggish economy seen dragging down U.S. population rate
By Stephen Dinan
The Washington Times
Monday, December 30, 2013

** FILE ** Illegal immigrants prepare to enter a bus after being processed at Tucson Sector U.S. Border Patrol Headquarters Thursday, Aug. 9, 2012, in Tucson, Ariz. New strategies being implemented by the U.S. government, including the halting of one-way flights back to the interior cities in Mexico, are in place to streamline processing and expedite a return to Mexico. (AP Photo/Ross D. Franklin)

The U.S. population this year grew at its lowest rate since the Great Depression, according to the latest Census Bureau estimates Monday that suggest the sluggish economy continues to tamp down on immigration, and birth rates are still low for those already here.

The country added just 2.255 million new people between July 1, 2012, and July 1, 2013, the Census Bureau reported. That’s the smallest total increase since the 1980s and, when measured against the size of the population, is less than three-quarters of a percent, or the lowest rate of growth since 1937.

“It shows the impact of the recession and its aftermath still exist,” said William H. Frey, a demographer at the Brookings Institution. “What we’re seeing now is really economically driven.”

North Dakota, powered by an energy boom, and the District of Columbia, which thanks to the federal government has proved to be recession-proof, led the way in growth, at 3.1 percent and 2 percent respectively.

West Virginia and Maine brought up the rear, with each losing a slight number of residents in 2013.

The Census Bureau said there were 316,128,839 people in the U.S. on July 1. A year earlier, there were 313,873,685.

Growth, which was strong at about 1 percent a year in the 1990s, has weakened substantially since the economy slipped into recession in 2008, and the prolonged weak recovery has kept things tepid. The rate appeared to have bottomed out in 2011 and ticked up slightly in 2012, but dipped again in 2013.

The last time growth was worse than this was in the 1930s, when the population grew at less than seven tenths of a percent for six straight years, from 1932 through 1937.

Comment by ahansen
2014-01-05 11:04:31

I’d like to make a brief reappearance here to correct just one more egregious example of albuquerquedan’s tendency to cherry pick to his own conclusions then sensationalize it for his own purposes.

Anyone who bothered to watch the referenced video (and it is indeed fascinating and extremely well-produced) would know I was referencing the UNITED STATES in my commentary, not North Korea.

Comment by albuquerquedan
2014-01-04 08:42:07
On a much more serious note, remember A-Hansen quoting from North Korean studies and the conservative part of this blog pointing out just how brutal that government was?

Comment by ahansen
2013-01-07 01:23:57
For those with an hour-and-a-half of their time to invest, here is an absolutely fascinating (and highly sophisticated) 2011 propaganda film from North Korea that discusses precisely what we’ve been railing about here on HBB for the last seven years. Wry, uncanny, and disturbing.
“…the tactics of fear and religion to manipulate the masses, as well as a complicit, paid-off media used by the the 1% to show you what they want you to see, and teach you what they want you to believe, from a very early age, while giving you colorful distractions to keep you from thinking about the bigger problems….”
Reply to this comment

Comment by Whac-A-Bubble™
2014-01-05 11:27:23

Happy New Year! Hope you are well, and we’ve missed your posts.

Perhaps we could lean on ABDan to rile you up more often?

P.S. What do you think about the dog execution story? True or false?

Comment by ahansen
2014-01-05 12:33:07

Keep in mind that this story first appeared in the PRC version of the New York Post, the Hong Kong based, Wen Wei Po — and initially no other news service picked it up, not even the South Koreans who are always happy to villify the DPRK.

The recently-departed Jang Song Thaek apparently wanted to put his older brother, a FOB (friend of Beijing, now in exile) on the throne, and that didn’t sit so well with Dear Leader. Now that China’s influence in North Korea has been further diluted, it’s only reasonable that a campaign of mutual vilification should ensue. See: “Marie Antoinette– ‘Let them eat cake’”.

This is not to say that DPRK isn’t capable of creative barbarism, but it’s more likely that Dear Uncle faced his demise by firing squad — or mortar round, like army vice minister, Kim Choi.

Comment by Whac-A-Bubble™
2014-01-05 15:54:23

I guess Kim Jong Junior doesn’t much care for central bankers, either?

North Korean army minister ‘executed with mortar round’

A North Korean army minister was executed with a mortar round for reportedly drinking and carousing during the official mourning period after Kim Jong-il’s death.
North Korean army minister ‘executed with mortar round’
By Julian Ryall, Tokyo
1:55PM BST 24 Oct 2012

Kim Chol, vice minister of the army, was taken into custody earlier this year on the orders of Kim Jong-un, who assumed the leadership after the death of his father in December.

On the orders of Kim Jong-un to leave “no trace of him behind, down to his hair,” according to South Korean media, Kim Chol was forced to stand on a spot that had been zeroed in for a mortar round and “obliterated.”

The execution of Kim Chol is just one example of a purge of members of the North Korean military or party who threatened the fledgling regime of Kim Jong-un.

So far this year, 14 senior officials have fallen victim to the purges, according to intelligence data provided to Yoon Sang-hyun, a member of the South Korean Foreign Affairs, Trade and Unification Committee.

Those that have fallen from favour include Ri Yong-ho, the head of the army and Ri Kwang-gon, the governor of the North Korean central bank.

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Comment by phony scandals
2014-01-05 18:23:54

I miss you.

You are a pretty cool lady.

From the artist formrly known as jeff saturday. :)

Comment by Whac-A-Bubble™
2014-01-05 11:29:53

Is there any substance to the rumor that a Puerto Rico default could tank the U.S. municipal bond market in 2014?

Comment by Whac-A-Bubble™
2014-01-05 11:33:12

Larry McDonald, Contributor
Wall Street
1/03/2014 @ 12:29PM |118,982 views
Could a Puerto Rico Default Hammer the $3.7 Trillion US Muni-Bond Market in 2014?

A democracy will continue to exist up until the time that voters discover they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship.

– Alexis de Tocqueville 1835

As we head into 2014, you may be asking why we are concerned about a small island located in the Caribbean Sea, about a thousand miles southeast of Miami. Geographically, it is a mere speck on the map… practically irrelevant. In fact, 70 islands the size of Puerto Rico could fit comfortably into the state of Texas. However, the debt burden currently burying this economy may eventually send nasty tremors into the United States’ municipal bond market.

Surprisingly, of all the US muni bond funds, a staggering 75% of them are lending money to Puerto Rico, leaving millions of US investors and a large portion of US brokerage accounts exposed to this beleaguered little island. We suspect Puerto Rico will become America’s Greece. If swans could fly this far south, they would without question be the color of night.

2014 Tail Risk

Texas’s state government debt is relatively modest, near $40 billion, or $1,577 per resident. Puerto Rico’s public debt of $53 billion is nearly $15,000 per person, but when we add inter-governmental debt the mountain rises to $70 billion, or $17,500 per person. Throw in a violently under-funded pension and healthcare obligations, the noose approaches $160 billion. That’s $46,000 per person, enough to make one think about trying a swim for Miami.

Comment by jose canusi
2014-01-05 13:01:02

Yes, this Puerto Rico issue is VERY interesting. It wasn’t even on my radar until the other day, when I heard someone discuss it on the radio.

“leaving millions of US investors and a large portion of US brokerage accounts exposed to this beleaguered little island. We suspect Puerto Rico will become America’s Greece. If swans could fly this far south, they would without question be the color of night.”

It’s time investors, banks, etc. just took the hit. I mean, this bailout crap is for the birds.

Comment by 2banana
2014-01-05 14:03:08

That’s $46,000 per person, enough to make one think about trying a swim for Miami.

If bondholders ares stupid enough to lend Puerto Rico money at these insane levels…

Then f*ck them if they lose their entire investment.

And yes - the US Government guaranteeing these loans in the past mighty contributed to this…

Comment by Whac-A-Bubble™
2014-01-05 11:36:11

Muni bond fund forecast: Cloudy in 2014
Last year, bonds from states, cities and counties suffered their worst annual performance since 2008 and only their fourth losing year since 1990.
By Walter Hamilton
January 5, 2014, 5:00 a.m.

With interest rates set to rise, many on Wall Street are wondering if the municipal bond market is in for another pummeling as 2014 gets underway.

Investors couldn’t get out fast enough last year. Bonds from states, cities and counties suffered their worst annual performance since 2008 and only their fourth losing year since 1990. The nearly $4-trillion market, a favorite of mom-and-pop investors for their relative safety and tax benefits, seemed to get hit from all sides.

Wall Street was spooked by talk that the Federal Reserve would put an end to the easy-money policies that helped propel stocks to new heights. That was compounded by the fallout from a handful of municipal bankruptcies, including Detroit, the biggest in U.S. history.

The result: $48.5 billion was yanked out of muni bond funds in 2013, according to researcher Morningstar Inc.

“People thought munis were a good place to hide, and they’re finding out you can lose money in munis in a rising interest-rate environment,” said Darell Krasnoff, managing director at Bel Air Investment Advisors.

“We wouldn’t avoid them,” Krasnoff said. “We use them. But we use them for a role and we have less of them today than we did a couple of years ago.”

Comment by Bill, just South of Irvine
2014-01-05 14:59:18

I am pleased that my latest prospectus from my municipal bond mutual fund addressed the Puerto Rico thing by cutting holdings of Puerto Rico bonds.

Comment by Bill, just South of Irvine, CA
2014-01-05 11:31:29

Why do these memes by MSM and the LIEberals always seem to be on the side of growing the size of thugernment?

1) You throw your money away on rent but a house is an investment.
2) Taxation is necessary to have for a civil society.
3) Guns kill.
4) Ownership society
5) Spread the wealth around

Comment by Housing Analyst
2014-01-05 13:53:39

5) Spread the wealth around by robbing you and me blind

“Why do these memes by MSM and the LIEberals always seem to be on the side of growing the size of thugernment?”

Because they know it appeals to the Free $hit Army

Comment by azdude02
2014-01-05 15:29:54

how is unemployment treating you? your checks run out yet?

Comment by Housing Analyst
2014-01-05 15:36:17

Well hello $hitHouse Poet…. Hows that depreciating shanty of yours?

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Comment by Avocado99
2014-01-05 18:17:01

1) You throw your money away on rent but a house is an investment.
2) Taxation is necessary to have for a civil society.
3) Guns kill.
4) Ownership society
5) Spread the wealth around

Reagan grew the gov an tripled the deficit, he also gave amnesty to millions.


Comment by Housing Analyst
2014-01-05 18:54:32

Reagan was a LIEberal statist.

Comment by Bill, just South of Irvine, CA
2014-01-05 21:03:15

Yup. Reagan was a LIEberal. He even glowed when he talked about FDR. Seriously, I remember. He was honest though. Made no bones about it that he was always signing in increasing government spending. He would say several times he’s not cutting government spending. He’s cutting the rate of increase of government spending.

This sounds very familiar with regard to taper.

The Fed is cutting the rate of increase of credit. But they are increasing credit. And most people think “taper” = “tighten.”

Comment by Bill, just South of Irvine, CA
2014-01-05 16:40:30

Here’s a fun link

He comes up with a 5% of net worth rule on getting a car. This gets me into the upscale cars such as BMW M3. The 5% rule is a very reasonable rule along with my 16% rule on how much of a percentage of your net worth you should purchase a single family home.

Both rules protect you from bubbles. And they should be used in conjunction with a diversified portfolio in bonds, short term government securities, cash, precious metals, stock, and stock index funds.

For now, I enjoy driving my cheap car, as it keeps would-be thieves away. But very soon I will be in the 5% rule range of a new Porsche 911 4S, and it would be sort of ludicrous that I could not have some fun driving a world class car on weekends.

Comment by Whac-A-Bubble™
2014-01-05 17:03:31

I’m reasonably in line with the 5% of net worth rule on car ownership, though I’m not sure if that is a guideline for financing a car purchase or owning one free-and-clear. For instance, if you own three cars outright, as we do, then their combined values are part of your net worth. So these should presumably be included in the calculation used to determine what 5% of net worth is.

The 16% rule applied to housing suggests we are better off renting. I doubt that any Californian we know, except for a few bonafide millionaires, can claim to own a home valued at below 16% of their net worth. And I know at least one fellow whose dad is a millionaire who chooses to rent rather than risk losing a bundle of money on overpaying for the privilege of owning a California home.

Comment by Bill, just South of Irvine, CA
2014-01-05 18:37:41

My 16% rule applies to people who should have been saving for the last 30 years and not owning yet. For first time home buyers (in their 20s and 30s) in flyover country it might make sense to them. My second cousin in his early 30s did that. But he’s in flyover country.

Reasons for my 16% rule:

1. Your primary residence is a very poor investment if you dare call it an investment. You should save to the max in low expense stock index funds starting as early as possible and not throw your retirement and freedom away on a house.

2. In real estate collapses you don’t suffer that much. You might lose half, then you are down 8% of your net worth.

Actually the 16% into SFH is a higher percentage than I would advise people to accumulate precious metals. Also for the reason we saw of a 20 year depression in metals. But you can always dollar cost average to metals and take them with you. When your nabe goes south with hooligans and shootings and stabbings you will have to drop your price very radically to get out of it and sell to the next fool to avoid being trapped.

Comment by Bill, just South of Irvine, CA
2014-01-05 19:06:01

My only hesitation is that bad intentioned people will mark you as “rich” if you drive the car of your dreams. The rentals I stay at while I work are not rich, and the parking is not gated, although there are garages. I could park the upscale car at my friends’ $700,000 house on the street and cover it while I’m not using it. Then have Uber drop me off when I want to use my car and get the thrills for my weekends.

Comment by Whac-A-Bubble™
2014-01-05 19:11:01

I’ve always been tickled by the story of how Sam Walton, Wal-mart founder, used to tool around Bentonville, AR in an old pickup truck.

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Comment by Bill, just South of Irvine, CA
2014-01-05 20:50:34

Wealthy couple my dad knew in the 70s would drive around in their old Ford pickup - they grew citrus in the San Joaquin Valley. They loved to socialize with other seniors at senior centers. My dad told me they were earning $30,000 per month income (in the 1970s) from their California municipal bonds.

The bad part. They left their estate to their 40 year old son. He immediately lived the wealth part and got up to his ears in attractive women. Lost most of the inheritance. He’d be in his 70s or 80s now - if he’s still alive.

Two books I read in the late 1990s: They both impressed me in certain ways opposite.

1. “The Millionaire Next Door” by Stanley and Danko hit home. I could see the most spoiled sibling was the least successful. I was the only son out of 4 kids so I supposedly was spoiled. Not sure. I had my arguments with my dad though. He did not give me a car and did not give any of us a car. He did pay for our health care and dental care and nag us that we must go to college. In fact I gave my parents a brand new roof for their house and a nice new television when I was in college.

2. Harry Dent’s “The Roaring 2000s” only for the argument against being forever frugal. You have to enjoy your wealth. If you don’t someone else will enjoy it for you.

So there is a balance somewhere. I mostly abided by #1 above. Maybe for fear of losing it all - or most of it.

Comment by Whac-A-Bubble™
2014-01-05 17:04:41

“…short term government securities…”

What about long-term government securities? Are you suggesting these should be avoided?


Comment by Bill, just South of Irvine, CA
2014-01-05 18:28:38

“What about long-term government securities? Are you suggesting these should be avoided?”

Good golly no. I hold some and have been dollar cost averaging into Arizona 5 to 7 year municipal bonds through my mutual fund since January 2002.

If you have a long term bond fund, continue to dollar cost average. Assumed you reinvest your income from those long term bond funds like I have always done. Your cost basis is way low on them.

I would just not rebalance a huge amount into Long Term bonds from 0 of them to a huge percent of your net worth. Big difference.

I rebalanced $50k in my 401k from my large blue chip stock fund into a fund of government securities with average maturity of 30 months. That’s the most I do when rebalancing to bonds at record low interest rates.

Comment by Whac-A-Bubble™
2014-01-05 18:56:58

“I would just not rebalance a huge amount into Long Term bonds from 0 of them to a huge percent of your net worth. Big difference.”

I totally agree with you in principle, though my inner gambler has a secret desire to bet against the constant drone of MSM articles advising everyone to avoid long-term bond funds like the plague. With financial experts unanimously agreeing that long-term bond funds are losers, isn’t there at least some chance of a surprise near-term reversal in their fortunes?

Advice for 2014: Buy stocks, groan over bonds
Posted: Sunday, January 5, 2014 6:45 pm
Jim Gallagher/St. Louis Post-Dispatch (MCT)

Stock investors cheered last year while bond investors groaned. Investment gurus generally expect to hear the same noises for 2014, although the laughing and moaning should be more subdued.

Expect a normal year for stocks, they say, with returns perhaps in the mid-to-high single digits. Expect a blah-to-bad year for bonds, especially the long-term variety, although the results won’t be as dreary as the year gone by.

Those forecasts, of course, depend on the world going the way the smart people expect: moderate economic growth in the United States, low inflation and a modest rise in long-term interest rates — and without wars or another fiscal blowup in Washington.

This is “not an ideal environment, but one that should support further gains in stocks, and perhaps hints at a virtuous cycle of global growth that could be possible the stars align,” writes Russ Koesterich, global chief investment strategist at BlackRock.

Reality has a way of defying expectations. Few forecast a 30 percent gain for stocks this year. No one really knows what 2014 will bring.

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Comment by Bill, just South of Irvine, CA
2014-01-05 19:14:09

But if you have a good amount of long term bonds already that you held for years (bonds) and dollar cost averaged to (bond funds) and interest rates stay zero another 15 years you are also in a good situation.

My AAZAX goes down when people expect rates to rise, and people sell the fund’s holdings, which give me a higher dividend. On the other hand when the Fed reveals no end to easy money, my AAZAX NAV goes up and my income goes down. But I keep adding money in it every month and that has been one of my best moves. That’s144 purchases in the last twelve years.

Comment by jane
2014-01-06 01:38:01

Amen on the cheap car. I’m getting my next one from a towing company auction and paying out of the mid-month paycheck. If I can’t get one for that, I’ll go to the next one. Used cars are becoming plentiful again. Eff ‘em. I’m not buying into this $35K car business.

While we’re at it, when I retire I’m gonna buy a house for cash in one ‘a them depopulating coal towns I stopped in a few months ago, in lieu of renting a storage unit. I’ll arm up, get the next Akita, and take the scenic route around the country in one ‘a those used conversion vans. My objective being to make a profit offa SS.

Originally I was thinking about teaching, buying an apartment house/trailer park or consulting (plenty of demand here for Systems Engineering). But - I skipped the teenage rebellion and mid-life crisis stages. Two out of the three practical options will still be open later, I think. Teaching requires that I stay in the area, and under no circumstance am I willing to do that.

I feel the need for something completely different.
Laughing at myself here. If history is a predictor, I’ll wind up buying an apartment house and a trailer park and teaching, so as to have an excuse to complain about how little free time I have.

Hope I can manage to segue into a different model, though! I could send in feet on the street observations about the RE markets in the towns I pass through, through the lens of a former beltway bandit.

We’ll need to develop a rating scale and establish validity and reliability measures.

Comment by Bill, just South of Irvine, CA
2014-01-06 21:19:27

“Amen on the cheap car” - Even though I get cut off by drivers in cars that cost 3 times as much I have the last laugh.

I had a run-in with a fat toad in a Hummer a few years ago in the South Bay once. I was driving by a hospital and a EMT flagged me to wait. The Hummer driver then turned the corner and saw me stopped in the street. He then drove around me. I was pissed and waved my fist at him. He saw that and called me “white trash.” Obviously by the fact that I was in a Toyota economy car. And he was white himself. The EMT should have flagged that guy down too - to wait.

The kicker is that I probably have at least the same net worth as the fat toad driver of the hummer, if not more. He was older than me. I get that all the time. I walk in my blue jeans from my apartment to my mailbox. It’s a poor design of where they put the mailboxes because you walk along the drive past the garages and carports. 1.5 ton vehicles sometimes pass by as I walk and at an unsafe speed. They figure I’m a worthless joe because I rent just like they do.

Comment by Whac-A-Bubble™
2014-01-05 17:08:53

Five years after the world financial system almost went up in smoke, how are financial reforms to avoid a replay coming along?

Comment by Whac-A-Bubble™
2014-01-05 17:11:03

ft dot com
December 8, 2013 6:35 pm
BIS warns hunt for yield spurring loose credit conditions
By Tracy Alloway in New York

The global search for yield has spurred some of the loosest lending conditions in credit markets since before the crisis, the Bank for International Settlements has warned.

Sales of riskier assets surged after the Federal Reserve opted to postpone the “tapering” of its bond purchases, forcing investors to once again seek additional returns. At the same time, banks have struggled to recover since the crisis – encouraging big companies to borrow from the bond or syndicated loan market and giving a further boost to resurgent credit markets, the BIS said in its latest quarterly review.

“After a brief pause, the search for yield has continued largely unabated,” said Claudio Borio, head of the monetary and economic department at the BIS, which is known as the central bank’s bank. “So far investing in corporate debt has paid off but we think we don’t know how long lower default rates will prevail.”

“Leveraged loans” granted to the riskiest corporate borrowers accounted for about 40 per cent of syndicated lending from July to November – a higher proportion than during the pre-crisis period from 2005 to 2007.

Sales of payment-in-kind notes, which give borrowers the option to repay their lenders in additional debt, surged to $9bn in the first three quarters of the year. Such bonds are generally considered riskier than other types of debt since roughly one-third of pre-crisis issuers defaulted between 2008 and 2013, the BIS noted.

Investing in riskier corporate debt has so far been a successful strategy for investors hungry for extra returns, the BIS said, since default rates continue to hover around their historic lows thanks to low interest rates and an abundance of cash.

The question, the BIS added, is whether default rates spike once central banks around the world begin to withdraw their extraordinary economic stimulus policies.

“What is happening in corporate markets is unusual,” said Mr Borio. “It is as if the typical relationship with the macro economy has taken a holiday. Spreads are low and so are default rates.”

Comment by Whac-A-Bubble™
2014-01-05 17:13:57

ft dot com
January 1, 2014 7:00 pm
2014 outlook: Sugar high
By Tracy Alloway and Michael Mackenzie
‘Credit Cassandras’ say strong demand for risky bonds is a sign of frothy markets

As snow fell in New York City on a December afternoon, waiters bearing trays of cookies fanned out among the group of bankers and investors gathered at the New York Athletic Club. The sweet biscuits were courtesy of Leonard Tannenbaum, chief executive of Fifth Street Management, who had a message for those attending the financial conference.

I believe there’s another cycle coming,” said Mr Tannenbaum, whose specialist lending firm enjoys the support of investor David Einhorn. “So have the cookie. I want you to enjoy the sugar high – while it lasts.

US credit markets rebounded in 2013 as a flood of central bank money and continued low interest rates pushed investors into riskier but higher-yielding assets.

While many see the resurgent demand for riskier loans and bonds as a natural effect of a nascent US recovery, others – such as Mr Tannenbaum – see it as evidence of a bubble blown by central banks.

To the sceptics, the market is experiencing the kind of frothiness seen before the 2008 financial crisis. This, too, will end in tears, they warn.

Perhaps the foremost of these “credit Cassandras” is Jeremy Stein, the US Federal Reserve governor who warned in February that markets may be overheating. “A prolonged period of low interest rates, of the sort we are experiencing today, can create incentives for agents to take on greater duration or credit risks, or to employ additional financial leverage, in an effort to ‘reach for yield’,” he said, flicking through slides of warning signals. Since then, those warning signals have flashed ever brighter.

Issuance of syndicated leveraged loans – those made to companies that already carry high debt loads – reached $535.2bn in 2013. That is just shy of the $604.2bn sold in 2007, at the height of the last credit bubble. Meanwhile, loans that come with fewer protections for lenders, known as “covenant-lite”, accounted for almost 60 per cent of loans sold in 2013, compared with a 25 per cent share in 2007.

Sales of “payment-in-kind” notes, which give borrowers an option to repay lenders with more debt reached $11.5bn in 2012 – a post-crisis high.

“There are no bargains in fixed income. We have seen a return to a lot of the practices that made people nervous in 2007 such as PIKs and cov-lite,” says Russ Koesterich, chief investment strategist at BlackRock.

Sales of “junk”, or high-yield, bonds surged to a record in 2013 as companies rushed to refinance and investors snapped up the resulting assets. Issuance of junk bonds rated “triple C” – the lowest designation – jumped to $15.3bn, surpassing the pre-crisis peak.

“There are early warning signs of excess in the high-yield bond market with the heavy issuance of triple C rated debt,” says Edward Marrinan, of RBS Securities.

Comment by Whac-A-Bubble™
2014-01-05 17:16:47

Europe to relax bank split reforms: report

Brussels is reportedly prepared to ease financial reforms such that big European banks would not be forced automatically to split lending operations from risky trading.

Comment by Whac-A-Bubble™
2014-01-05 17:34:45

So let me get this straight: If the stock market goes up, it means the Fed made the right move? And if it goes down, then the Fed screwed up?

Comment by Whac-A-Bubble™
2014-01-05 17:36:12

Jan. 5, 2014, 8:00 a.m. EST
Stock market to find out if the Fed made the right move
Week ahead: FOMC minutes, jobs report, and a slow start to earnings
By Wallace Witkowski, MarketWatch

SAN FRANCISCO (MarketWatch) — Investors this week will look at what the Federal Reserve used as a trigger to taper its asset purchases, and whether jobs data back that decision, while focusing more on company fundamentals as earnings season ramps up.

The week ahead will also see more traders return from holiday vacations, so volume is expected to get a sizable boost. Since Christmas, average daily volume for stocks has been 25% or more below the fourth-quarter average for 2013, according to Barclays.

Comment by Whac-A-Bubble™
2014-01-05 20:49:49

Jan. 5, 2014, 9:21 p.m. EST
Market top to test long-term optimism
By Avi Gilburt

Do you know anyone anymore who is willing to short this market? Do you know anyone who doesn’t think that this market is going higher? I mean, even Dr. Doom, Nouriel Roubini, and Marc Faber, the author of the Gloom, Boom and Doom Report, think that the market has higher levels to attain. That is a lot of “Gloom and Doom” that has now been taken out of the market. Is there any more “wall of worry” left for this market to climb?

This past week, I read an article that simply astounded me with its conclusion in light of the facts it cited. Specially, it noted that “it is important to remember that Main Street is jumping into the stock market. This year [2013], small investors put the most money into stock funds since 2000. And, as a group, they generally tend to be late to the party.” But, the conclusion to which the authors came was that it was still time to go long this market, as blue skies are still on the horizon. Well, I mean, isn’t that the easiest trade to make at this point in time? Isn’t that what everyone believes? Seriously now, haven’t all market participants now seen and believe the “BTFD” videos?

Let me get this straight… mom and pop have put more money into this market than at any other time in history, and mom and pop are known to always be wrong and buy at the highs. And, as the put/call ratio seems to be near record levels, and in light of evidence that institutions are selling into this rally — not to mention the amount of divergences that the longer term charts are displaying at this time — we should continue to expect higher and higher in this market?

Comment by Housing Analyst
2014-01-05 18:42:07


Dump that rapidly depreciating house while you still can.

Comment by Housing Analyst
2014-01-05 18:52:19

“With borrowing costs up 80% in just 7 months, what did you think was going to happen to housing prices…. go up?”

I love it when interest rates normalize.

Comment by Whac-A-Bubble™
2014-01-05 21:00:11

Dollar Reaches One-Month High Versus Euro on Fed Taper Outlook
By Kristine Aquino and Masaki Kondo Jan 5, 2014 6:44 PM PT

The dollar reached the strongest against the euro in a month before U.S. services and factory data today that may bolster the case for the Federal Reserve to end its bond-buying program this year.

The Bloomberg Dollar Spot Index closed last week at the highest in almost four months after Fed Chairman Ben S. Bernanke said headwinds for the U.S. economy may be abating. The central bank said Dec. 18 it would trim monthly bond buying by $10 billion this month. The yen climbed against most of its 16 major peers as its decline last year was seen as excessive. The euro slid to an almost three-week low against the yen before data tomorrow that may show the region’s inflation stayed below 1 percent.

“The dollar remains in the upward trend,” said Kengo Suzuki, the chief currency strategist at Mizuho Securities Co. in Tokyo, a unit of Japan’s third-biggest financial group by market value. “I expect tapering to continue at around a $10 billion pace for each Fed meeting.”

Comment by Whac-A-Bubble™
2014-01-05 22:32:24

Sushinomics: How Bluefin Tuna Went From Cat Food to Solid Gold
The curious case of the million-dollar fish
Svati Kirsten Narula Jan 5 2014, 9:31 PM ET
Kiyoshi Kimura paid a lot of money for this bluefin tuna, the first one auctioned off at the Tsukiji fish market in 2013. (Toru Hanai/Reuters)

Every year, on the first Saturday in January, Japan makes a grand statement to the global fishing community by putting an exorbitant price on the head of a single bluefin tuna. At the famous Tsukiji fish market in Tokyo, the first bluefin auction of the year represents many things: growing consumer demand for bluefin sashimi, the exploitation of natural resources, the collapse of a species, shortsightedness in the face of impending doom to the entire ocean, a depraved publicity stunt.

In 2013, Kiyoshi Kimura, the owner of a Japanese sushi restaurant chain, paid $1.76 million for the first bluefin at Tsukiji, which weighed 489 pounds. Kimura had paid $736,000—a world-record price at the time—for the first tuna of 2012. That fish weighed 593 pounds.

It’s no surprise, then, that journalists were steeling themselves for what was sure to come on January 4, 2014: If the past decade’s trend in pricing continued, this year’s first tuna would surely fetch more than a million dollars. But the Tsukiji fish market bucked tradition this weekend and sold its first tuna to Kimura, yet again, for a mere $70,000. That’s still way more money than most bluefin go for in Japan. But compared to what everyone was expecting—an extravagant sum to start off the new year and remind us that these are the most prized fish in the sea—that’s one crazy cheap tuna.

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