The Housing Bubble

When the Tea Party gathered on the National Mall they left it cleaner than when they got there.

When Occupy declared class warfare on the Producers this is what happened:

http://www.dailymail.co.uk/news/article-2046586/Occupy-Wall-Street-Shocking-photos-protester-defecating-POLICE-CAR.html

“When a politician proposes to take from A to give to B, he can always count on the support of B.”

This is what reveals Lola as a paid shill mouthpiece. He begins pushing the income inequality meme a few weeks ago right on cue with the coordinated plan. Soros, Bloomberg or some other left wing moneybag with a hidden agenda has now decided this is the push to make.

Because they know they can’t defend the current Messiah, they are trying to shift the battlefield back thirty years to Reagan. This also allows them to cover up their own malfeasance in wrecking the economy even before the Messiah. Maybe it is all the doing of the billionaires backing Hillary cause if you dig too deeply into Bubba’s terms what do you see? NAFTA out the yin yang and repeal of Glass-Stegall.

You are a great poster boy for inequality Lola, a self described high net worth individual living within sight of the slums.

Lola, you are the only one preventing YOURSELF from redistributing YOUR. Own wealth to the lazy. What is stopping you? You looking for “brownie points” for being a hand-wringing altruist?

None here, save, Oxide or Polly will admire you for that. Of course what you really want is to give out someone ELSE’S money. It is not admiration you would get. It is hatred. We hate your kind.

Heres what’s really going on with employment.. or the lack of it.

http://data.bls.gov/timeseries/LNS11300000

Is a 10% stock market correction likely to occur some time in the foreseeable future, or is it safe to assume that current Fed policy makes that unpossible?

Can the U.S. stock market keep going up like gangbusters against the backdrop of a weak labor market ??

Don’t know if you were listening early this morning but the optimism that the jobs report was going to be 200,000 + was across the board with every talking head…When the number came in at 74,000 they were fumbling all over the place to find the reason…First excuse was the weather…

Next was the unemployment rate dropping to 6.7% in the face of a measly 74,000 jobs created…Drop out rate was the excuse but likely true and it may be far greater than anyone understands…

Couple all this with the lack of wage growth and where are we…

The ObamaScare keeps companies from hiring permanents. And as LNG as it continues to not be repealed, staffing company stocks will continue to reflect the growth in temping.

Jan. 10, 2014, 1:06 p.m. EST
Fed’s Bullard: Inflation to pick up in 2014
By Greg Robb

WASHINGTON (MarketWatch)– St. Louis Fed President James Bullard said Friday he expects inflation to pick up this year, despite having been surprised by lower prices last year. In a speech on the Fed’s forecasts to the Indiana Bankers Association meeting in Indianapolis, Bullard said inflation “remains a wildcard” for the central bank. The Fed’s preferred measure of inflation, the personal consumption expenditure index, rose at a 0.9% annual rate in November, well below the Fed’s 2% target. The core rate rose at a 1.1% rate. “There is no generally accepted explanation for the low inflation readings,” Bullard said. The St. Louis Fed president said both headline and core inflation should reach 1.6% by the end of the year. The Fed said in its latest policy statement that it was watching low inflation carefully. Bullard forecast growth would exceed 3% in 2014 and said the unemployment rate should fall to average 6.2% during the fourth quarter. Bullard was a voting member of the Fed’s rate-setting committee in 2013 and does not have a vote this year.

“…next.” !?

Dave Jamieson
With Government Shutdown, Furloughs, Pay Freeze, U.S. Workers Ask Where Their Friends Are
Posted: 10/02/2013 8:54 pm EDT

WASHINGTON — Working for the federal government is supposed to be the most stable gig in America, immune to the uncertainties of private-sector business. But between sequestration-induced furloughs and now a government shutdown, Steve Hopkins is wondering what’s so enticing about civil service these days.

“We went through a furlough, a very long term of uncertainty,” Hopkins, an Environmental Protection Agency employee of 25 years, said at the Capitol Wednesday. “You’re not even recovered from that and you’re coming into another era of uncertainty [with the shutdown]. And that promises to be followed by another era of uncertainty with the debt ceiling.

“You brought me here to do a job — if you want it done, let’s do it,” Hopkins went on. “If you don’t want it done, say so and send us home.”

Small-government conservatives have long railed against what they see as the high compensation and coziness of the federal workforce. Aided by a crummy economy and the constant budget fights, they’ve succeeded in making employment with the federal government share some of the same anxieties as the private sector. Cost-of-living wage bumps have been frozen for years, unpaid furloughs have been enforced, and now the shutdown has effectively locked an estimated 800,000 workers out of their jobs.

Democrats, typically seen as allies of federal employees, have played their own role in this squeeze, calling for mutual sacrifice at a time of high unemployment and budget squabbles. In 2010, President Barack Obama proposed a two-year freeze on cost-of-living adjustments for most civilian employees, later asking Congress for a raise of 0.5 percent and then 1 percent. (No such raise has yet materialized.)
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Did they even need a right vs. left smokescreen?

Let’em crater. Then buy later for 75% less.

Markets
Banks Cut as Mortgage Boom Ends
With Rates Creeping Up and Refinancings Dwindling, Lenders Get Squeezed and Earnings Face Hit
By Shayndi Raice and Nick Timiraos
Updated Jan. 9, 2014 7:14 p.m. ET

A sharp slowdown in mortgage refinancing is forcing banks to cut jobs, fight harder for a smaller pool of home-purchase loans and employ new tactics to drum up business.

The end of a three-decade period of falling mortgage rates has slammed the brakes on a huge wave of refinancing by U.S. households. The drop-off has deprived lenders of a key source of income at a time when the growth in loans for home purchases remains weak.

The Mortgage Bankers Association next week plans to cut its 2014 forecast for loan originations, which include loans for home purchases and refinancing. The current forecast of $1.2 trillion would represent the lowest level in 14 years. The trade group Wednesday reported that mortgage applications in the two weeks ending Jan. 3 touched a 13-year low.

Wells Fargo (WFC -0.48%) & Co. and J.P. Morgan Chase & Co. are scheduled to report fourth-quarter results next Tuesday, kicking off a wave of bank earnings reports. Analysts expect results across the sector to show that the number of loan originations for home purchases and refinances fell by 20% to 30% in the fourth quarter from the previous quarter.

In the third quarter, mortgage-banking income, which includes fees from making new loans and processing payments on existing loans, tumbled by 45% at 10 big banks tracked by industry publication Inside Mortgage Finance.

Already, banks across the U.S. have cut thousands of jobs in their “back office” mortgage operations to make up for the decline in refinancing activity. Wells Fargo has eliminated more than 6,200 mortgage jobs since the summer. Bank of America Corp. (BAC -0.36%) has said it hopes to cut about 4,000 jobs by the end of the fourth quarter. Citigroup Inc. (C -0.87%) has trimmed about 1,100 positions.

Guy Cecala, chief executive and publisher of Inside Mortgage Finance, said he thinks the job cuts could spread from back-office personnel to loan officers. “At some point, they’re going to hold [the loan officers'] feet to the fire,” he said.

Heather Welch, the branch manager in Harlingen, Texas, for Premier Nationwide Lending, a mortgage lender, said her branch is resorting to cost-cutting in areas like advertising and marketing.

“We have cut basically down to the bare minimum,” Ms. Welch said. “We have to be extremely careful.”

The decline comes after a three-decade period in which interest rates generally fell, home owners refinanced often, and banks bulked up to meet the rising demand.

From 2000 to 2003 alone, mortgage rates fell from a peak of 8% to a low of 5%, and refinance volumes soared to $2.5 trillion in 2003, from $230 billion in 2000.

After the housing bubble burst, lending for home purchases slowed sharply. But because mortgage rates turned downward in 2009 and again in 2011, refinancing perked up, leading to a banner year in 2012.

“What we saw in 2012 was extraordinarily high profits, so we really had nowhere to go but down,” Mr. Cecala said.

Now, refinancing is evaporating, said David Stevens, CEO of the Mortgage Bankers Association, and “the business is completely shifting” toward home-purchase lending as rates rise. The rate on a 30-year fixed-rate mortgage averaged 4.72% last week, according to the Mortgage Bankers Association, up from 3.6% last May.

To be sure, interest rates could drop again, which could stoke demand for refinancings. But because many borrowers already have refinanced, the pool of potential borrowers who could benefit from refinancing is dwindling.
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Especially affairs which confer power, wealth, or both…

The financial media is swooning over Stanley Fischer as Fed vice chairman.

• “Here is a guy who trained half of the central bankers in the world. He knows them,” said former Fed Vice Chairman Donald Kohn, a senior fellow at the Brookings Institution. Fischer “is tremendously respected everywhere in the world, not only by central bankers but by finance ministers and prime ministers.”

• “From 1988 to 1990, he was chief economist at the World Bank. After returning to teaching at MIT, Fischer joined the IMF as deputy to Managing Director Michel Camdessus in 1994, working to resolve financial crises in Mexico, Russia and Southeast Asia. He left the IMF in 2001 and joined Citigroup Inc. as a vice chairman.”

http://www.bloomberg.com/news/2014-01-10/fischer-as-financial-statesman-may-help-fed-smooth-qe-unwinding.html

This should be good. First we have a CEO of Goldman Sachs orchestrating the response of the taxpayer to the financial crisis (Paulson), now we have a vice chairman of Citigroup as nominal second banana at the Fed.

The myth of the disinterested technocrat.

The names on this list clearly reflect no conflicts of interest: http://www.newyorkfed.org/aboutthefed/org_nydirectors.html

Takes “fox in charge of henhouse” to a whole new level.

Shinzo Abe’s secret weapon
Emily Cadei, OZY.com
12:04 a.m. EST January 11, 2014
The Yale professor whose bold ideas are behind Japan’s economic rebound.

- Prime Minister Shinzo Abe called upon Yale professor Koichi Hamadaa to help craft Japan’s economic revival policies
- Hamada met Abe while serving as a senior adviser for the Japanese government’s Economic Planning Agency
- Japanese investors are cheering the Tokyo Stock Exchange’s best year since 1972

When Shinzo Abe, head of Japan’s Liberal Democratic Party, decided to mount a political campaign premised on the radical restructuring of Japan’s economy, he placed a call to Yale professor emeritus Koichi Hamada.

One of the deans of the Japanese economics community, Hamada had been trying to persuade Abe and other Japanese politicians for years that only bold steps will help pull the country’s economy out of its two-decade malaise.

The 77-year-old professor finally found someone who was willing to listen.

That call took place in the fall of 2012. Barely a year later, the Japanese government has dropped the term “deflation” — the bête noir of its economy — from its monthly reporting, and Japanese investors are cheering the Tokyo Stock Exchange’s best year since 1972.

What’s behind the stunning turnaround? An aggressive set of monetary and fiscal policies that Hamada and other senior economists have been pushing to reset expectations about the Japanese economy and encourage companies and individuals to invest and spend more. The key element has been the effort to increase inflation by committing to the monetary policy of “quantitative easing” — increasing a country’s money supply by buying up government bonds.

It’s the same sort of tactic Federal Reserve Chairman Ben Bernanke has used over the last few years to propel America’s gradual recovery. The Bank of Japan is hoping to drive up inflation to 2 percent by 2015, an ambitious goal that it insists is within reach. A happy side effect has been the devaluation of the Japanese yen, making the country’s goods cheaper abroad and boosting exports. On the fiscal side, the Abe government passed a massive $200 billion stimulus package.

These policies aren’t exactly new, but the scope is exponentially larger than anything Japan has tried before, says Peter A. Petri, professor of international finance at Brandeis University and an expert on Asia. Through his bold rhetoric and personnel moves, Abe has signaled “the beginning of a comprehensive and sustained effort to build a new economic model,” Petri says. “A lot of this is about expectations, and they managed expectations marvelously in the last year.”

Hamada counseled Abe as he was crafting the policies, but he demurs when asked if he’s the “brains” behind the approach, as many have called him.

“That is an honor, but there are at least two or three or more who could be called the same way,” says Hamada, who started out studying law before turning to economics. He’s since amassed an impressive array of academic degrees — a bachelor’s and master’s as well as a law degree from the University of Tokyo plus a master’s and Ph.D. in economics from Yale.
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