Bits Bucket for February 8, 2014
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
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Is Mr Market pricing in a QE3 taper delay or postponement?
MARKET COMMENT: Stocks Gain Despite Weak US Jobs Report
Fri, 7th Feb 2014 18:09
…
The FTSE 100 is now looking set to record its first weekly gain in three weeks, currently up 0.4% at 6,582.55, the FTSE 250 is up 0.4% at 15,850.75 and the AIM All-Share is up 0.7% at 864.14.
The turn around may be due to traders taking positivity from a closer look at the labour force participation rate, or the amount of people in work or looking for work, which increased to 63% from 62.8%. The number of unemployed people came in at 10.2 million, little changed in January, according to the Bureau of Labour Statistics.
With the winding down of the Federal Reserves quantitative easing program directly linked to improving domestic economic readings, some commentators suggest that the weaker than expected jobs growth could lead to a delay of the next cut to US asset purchases, therefore supporting stocks.
“I don’t think we’re at taper delay territory yet, given Charles Plosser and Charles Evan’s comments earlier this week, but you could argue that the poor number might give Fed officials pause,” says CMC Markets chief market analyst Michael Hewson.
…
Business
U.S. Unemployment Down to 6.6 Percent, Labor Participation at 35-Year Low
Feb. 7, 2014 8:31am
Becket Adams
U.S. employers added 113,000 jobs in January and the unemployment rate fell slightly to 6.6 percent, down from its previous rate of 6.7 percent, the Bureau of Labor Statistics reported Friday.
Earlier estimates had put the number of new jobs at around 185,000.
“Today’s report is another reminder of both the progress that has been made and the challenges that remain,” the White House said in a statement after the report was released.
But given “the elevated long-term unemployment rate,” the statement added, “extending emergency unemployment benefits for the 1.7 million workers who lost them is critical. At the same time, the President will continue to focus on action, both pushing forward on priorities with Congress and using his pen and his phone to expand opportunity and growth.”
Much like December’s unemployment report, some of January’s decline can be attributed to people who have given up looking for work.
The U-6 unemployment rate, considered a broader measure of actual unemployment in the U.S., fell to 12.7 percent, down from its earlier read of 13.1 percent.
Meanwhile, the labor force participation rate increased again to 63 percent, up from its previous rate of 62.8 percent, a slight improvement but still at a 35-year low:
CIVPART
The decline in unemployment and the slight increase in labor force participation comes weeks after the United States Federal Reserve announced it would taper its multibillion-dollar quantitative easing policies. The Fed announced in December it would drawdown its $85 billion monthly purchases of Treasurys and Treasury mortgage-backed securities by $5 billion each starting in January.
…
Based on labor market participation, is it fair to say that quantitative easing has been a complete failure to revitalize the U.S. economy?
Ding ding ding!
All that liquidity has greased the economy, alright—greased those jobs as they slid right on over to China.
Or maybe its all the cash jobs that have been opening up all over the country…maybe paying people on the books today is too damn risky.
“Or maybe its all the cash jobs that have been opening up all over the country…”
For clarification, I was talking about legal employment. Of course one of the unmentioned consequences of hiking the minimum wage is to increase illegal employment opportunities at below the minimum.
Easy Does It - Rally Failure Possible
By George Brooks
February 7, 2014 6:16AM
The economic news this week has mostly been bleak. While Jobless Claims reported Thursday for the 2/1 week dropped 20,000, new hires as reported in this morning’s Employment Situation report were disturbing at 113,000 vs. a projected 185,000.
In recent years, prior to the Fed announcing its first taper on December 18, 2013, the market rallied on moderately bad news, since it assured the Street the Fed would not be initiating a taper out of QE. Good news was followed by lower prices over the short-term.
If the economy begins to slump further, the Street may return to its bone-headed “bad is good” mentality, expecting the Fed to pass on the next taper or two.
If the Street has changed its focus and sees economic growth as a positive, then good news will be seen as just that – “good,” and the Street will buy, but bad news seen as “bad,” and the Street will sell.
…
I don’t claim to be a macroeconomics expert, but labor force participation falling to a 35-year low can’t be a recovery sign, can it?
And to make the future prospects still worse, a higher minimum wage will further limit the number of potential American workers who can find legal employment, as anyone whose skills command a lower market wage than the minimum can look forward to living off food stamps and other free sh!t forever.
Slower Economy to delay Further Fed Taper?
By George Brooks
February 5, 2014 6:20AM
The market tracked the trading pattern I outlined yesterday, which suggests the market was marching to a “technical” drumbeat rather than to external forces, namely the financial chaos in the Emerging Markets.
The market rallied at the open then leveled off a little short of my targets.
The 10-year treasury traded at 2.626% after dipping below 2.60% in face of a flight to safety, suggesting an easing in the Emerging Markets crisis abroad.
The economic news this week has been bleak, which could cause the Fed to withhold further tapering.
In recent years, until the Fed announced its first taper December 18, 2013, the market rallied on moderately bad news, since it assured the Street the Fed would not be initiating a taper out of QE. Good news was followed by lower prices over the short-term.
…
Rest assured the recent U.S. labor market weakness was merely due to bad weather. Get out there and buy some stocks before their prices go even higher!
ft dot com
Global Market Overview
Last updated: February 7, 2014 9:21 pm
Equity bulls shrug off weak US jobs data
By Dave Shellock
Friday 21:10 GMT. Global equities made strong gains at the end of a volatile week that was largely dominated by uncertainty over the outlook for the US economy.
In New York, the S&P 500 equity index jumped 1.3 per cent to 1,797, giving it a gain of 0.8 per cent for the week. Across the Atlantic, the FTSE Eurofirst 300 rose 0.8 per cent, for a weekly advance of 0.7 per cent, although in Tokyo a 2.2 per cent rise for the Nikkei 225 could not keep the indicator from recording a 3 per cent drop for the five-day period – its fifth successive weekly decline.
Friday’s stock market gains came even as a disappointing US employment report added to concerns that momentum in the world’s biggest economy was slowing – which could affect the Federal Reserve’s plans to scale down its stimulus measures.
Non-farm payrolls rose by 113,000 last month, which – while an improvement on December’s revised 75,000 increase – was much less than expected. On a brighter note, the jobless rate slipped from 6.7 per cent to 6.6 per cent.
“Payroll growth appears to have slowed but, given the strength of economic growth in the second half of last year, we expect to see a rebound in the monthly gains over the next few months,” said Paul Ashworth at Capital Economics.
“Moreover, with the unemployment rate down to only 6.6 per cent, the Fed should continue to wind down its asset purchases.”
But Harm Bandholz, chief US economist at UniCredit, said the January report had provided more questions for the Fed to answer.
“On the one hand the ongoing decline in the unemployment rate – which is now only 0.1 percentage point above the threshold in the [Fed’s] forward guidance – means that an adjustment of the forward guidance is becoming more urgent,” he said.
“On the other hand the second lacklustre payroll gain in a row at least questions whether the Fed will continue to moderate its asset purchases at its upcoming meeting.”
The softer tone to the data helped push US government bonds higher. The yield on the 10-year Treasury, which moves inversely to the price, was down 2 basis points at 2.68 per cent, leaving it 2bp higher for the week.
The yield on the five-year Treasury, which is more sensitive to Fed policy, was fell 5bp on Friday to 1.47 per cent.
Treasury yields had fallen sharply on Monday, as nervous investors sought safety amid a 2.3 per cent slide for the S&P 500 – its biggest one-day drop since June.
That decline came as weak manufacturing data out of the US and China heightened worries about global growth and followed further hefty declines for emerging market assets.
But subsequent sessions saw equity buyers re-emerge amid a growing view that the US data disappointments might be largely down to extreme weather conditions.
However, analysts at Danske Bank urged investors to be careful of dismissing the weakness as merely weather-related.
“We expect GDP growth to ease slightly in the first half of 2014 on the back of some moderation in private consumption on the back of a very strong second half of last year,” Danske said.
“With emerging markets already fragile, financial markets could be very sensitive to signs of slower growth in the US.”
…
Has your favorite risk asset class experienced any taper tantrums lately?
ft dot com
markets
beyondbrics
EM taper tantrums delaying Kenya eurobond issue?
Feb 4, 2014 5:43pm
by Irene Madongo
Kenyan officials are on a round of investment meetings in London to discuss the country’s debut eurobond, pegged at $2bn, says the central bank. But market volatility is proving a nuisance and Kenya could be forced to delay the much-anticipated bond.
On Tuesday, analysts at Fitch Ratings said in a teleconference in London that the issue was unlikely to take place before April. Those remarks contrast with those of Kenyan officials, who reportedly said on Monday they were going ahead with plans to issue this month. So, is it going to happen?
This from Stephen Charangwa, fixed income portfoilio manager at Silk Invest:
…
Gerald D. Cohen | January 29, 2014 11:07pm
Emerging Markets Taper Tantrum
As expected, the Federal Reserve continued its tapering process, slowing monthly purchases of Treasuries and mortgage-backed securities another $10 billion to a total of $65 billion per month. Why has the taper, in combination with some weaker data coming out of China, led to a selloff in some emerging markets such as Brazil, Turkey, Indonesia and South Africa? Figure 1 depicts the recent slide in the Brazilian Real, Turkish Lira, Indonesian Rupiah and South African Rand against the U.S. Dollar since Bernanke started discussing tapering on May 22nd 2013 (a higher number indicates a weaker currency).[1]
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If I had the cash flow, I’d be stockpiling gold right now.
Whaddya know? Do tell. (I don’t have the cash flow either, sigh)
I do have the cash flow and right now I’m stockpiling cash.
Down the road a bit I look for Mr. market to offer a clearance sale, and for this I want to be ready.
Me too.
fire sale?
“fire sale?”
More akin to a panic sale - a sale caused by a panic due to falling prices.
Amazingly falling prices should lure in buyers (it works this way for most consumables) but for some irrational reason falling prices shakes out stockholders, at least the weak ones.
IMO these folks are the Price equals Value folks; These people do not understand how to value the fundamentals of a company so they end up valuing a company by watching its price - if the price goes up then, to them, the value goes up, and vice versa.
Ben Graham was right on when he said “In the short term the stock market is a voting machine and in the long term it is a weighing machine.” IMHO if an investor thinks long term then he should end up doing well.
I thought buy and hold was dead? What do you tell shareholders of pennys, radio shack and sears?
I love all the day traders here.
The fundamentals of Pennys, Radio Shack and Sears suck and have sucked for years. What happened to their prices should have been no surprise to those who chose to do their homework, whether they are buy and hold or otherwise.
Amazingly falling prices should lure in buyers (it works this way for most consumables) but for some irrational reason falling prices shakes out stockholders, at least the weak ones.
Gold. In the last 12 months its high was $1667. In the last 30 months its high was $1900. Its low the last 30 months was $1187.
While I don’t time the market well (hence I dollar cost average to stock mutual funds over decades) I do know that you can really expand your gains by selling off assets that have greatly exceeded your asset allocation percentage and at the same time buying assets that have really declined in price - using the proceeds from the sales of the former.
It is like leveraging with your own wealth within your own asset classes without risking other people’s money.
And you can do this over a period of time and not do any silly short term capital gains.
The fundamentals of Pennys, Radio Shack and Sears suck ??
Combination of many things got them…
“Combination of many things got them.”
And the lasting effects of these many things that got them weren’t about to change for the better.
Another lesson from Ben Graham (and Warren Buffet):
A TEMPORARY hit to fundamentals can often offer a buyer a buying opportunity because there are a lot of potential sellers out there in stock-market-land who cannot understand the difference between a temporary hit and a permanent change, and these are the guys that are going to be shaken out as soon as a temporary hit occurs.
But there’s another lesson from Buffet can be summed up in two words: “Turnarounds don’t”.
So those who do their homework properly will be able to tell the difference between a temporary change and a permanent sea change in a company’s fundamentals and will prosper in the long run by buying one at fire sale prices - at market panic prices - and avoiding the other.
I note there would have been a fire sale for ordinary folks like you who stockpile cash after the 2008-09 financial collapse, were it not for the Fed’s action to print, print, print, then buy up all the bad assets off private banks’ books.
Are you assuming the Fed doesn’t retain the option to bail out the banking industry again and keep asset prices at levels going forward where your cash will not offer any purchase advantage?
Are you assuming the Fed doesn’t retain the option to bail out the banking industry again and keep asset prices at levels going forward where your cash will not offer any purchase advantage?
Of course they always have that option… But doesn’t it get politically less and less tenable to be funneling money into the banks, after they have already had five or six years of massive subsidies to get their balance sheets back in order?
doesn’t it get politically less and less tenable to be funneling money into the banks
And remember: the only limit on their power is the political limits—e.g. what do they think they can get away with.
“But doesn’t it get politically less and less tenable to be funneling money into the banks, after they have already had five or six years of massive subsidies to get their balance sheets back in order?”
One would think so, but remember the Fed has a PR department which can propagandize any action they take to bail out private bankers as for the common good of all Americans.
“…the only limit on their power is the political limits—e.g. what do they think they can get away with.”
That’s right. It’s all discretion and no rules at the Fed.
no rules at the Fed.
Oh no, they have rules: the ones that they choose to impose on themselves, in order to reduce the risk that Congress might impose some on them.
Interesting point. Would it be fair to describe the Fed as ‘autonomous’ or ’self-governing’ then? (I.e. they can do whatever they want so long as the posse over at the Congress doesn’t get involved?)
Even the Fed must bow to reality, although it will fight unpleasant consequences of its own actions every inch of the way. Just what “reality” will demand, just what the price will be, is yet to be seen, however.
Why bow to reality when you can use the printing press and unlimited discretion in asset purchases to manipulate it to your liking?
Would it be fair to describe the Fed as ‘autonomous’ or ’self-governing’ then? (I.e. they can do whatever they want so long as the posse over at the Congress doesn’t get involved?)
That is very accurate, IMO.
I note there would have been a fire sale for ordinary folks like you who stockpile cash after the 2008-09 financial collapse
W.A.B. - the time to stockpile cash was during 2006-2007 and sell off some of the biggest individual stock gainers.
I think you meant “before the 2008-09 financial collapse.” Because late 2008 through Spring 2009 was the time to load up on stocks.
Stock screeners were screaming UNDERVALUED for hundreds of stock symbols those days of early 2009.
But we got an uber Fascist as a new President who we suspected those days was Marxist - and were wrong. We were afraid our wealth was going to be redistributed to the crack mothers and the lazy.
“Because late 2008 through Spring 2009 was the time to load up on stocks.”
Only because of quantitative easing; otherwise, those who did so would have caught themselves falling knives. I know, because I made that mistake after the Japanese stock market collapse in 1989, which was apparently followed by an inadequate amount of quantitative easing to prop up prices again.
Junior miners ETF was under $30 a few weeks ago in December and now above $38. An easy “buy low” strategy.
All “buy low” strategies are easy in hind sight.
For the last half of 2013 it looked as though precious metals prices were working on breaking out of a channel. I think December-January was the breakout for junior gold miners. GLD itself is near a breakout, so I figure physical precious metals have bottomed out too. The hindsight is visible about two months after the breakout. But the breakout can be predicted with trendline analysis and noting that there are very very few stocks outside mining that are below book value per share. The stock screens produce NOTHING. So that favors the most hated asset that has been insulted by multitudes of misshapen skulls out there parroting what the “experts” have been telling them.
Buy when the others are fearful, sell when the others are greedy.
The EM crisis has been great for anyone holding flight-to-quality assets in their portfolios (dollars, Treasurys, gold, etc).
Global Markets Throw a “Taper Tantrum”
– Posted Thursday, 6 February 2014
By Gary Dorsch, Editor,
A sharp sell-off in the global stock markets so far this year has left many small investors a bit puzzled and panicky, and unsure how to react. Retail investors in the US, who watched the from the sidelines in a state of disbelief, as the “Least Loved” Bull market on Wall Street, continued to climb to new all-time highs, - finally decided to throw in the towel in the second half of 2013, and jumped aboard the Bullish bandwagon. The late converts plowed $175-billion of their savings into US-equity funds, helping to push the S&P-500 Index to an all-time high at the 1,850-level. They gave little thought that maybe, the “Least Loved” Bull had climbed “too far and too fast” after gaining +175% from the Great Recession low.
January is usually a bullish month for US-stocks. So when the Dow Jones Industrials stumbled out of the gate, sliding -7% so far this year, it raised a warning flag. It means that 2014 will be a volatile year. On Wall Street - the word “Volatility,” is a code word for sharp declines in the market place that are expected to happen frequently. Even if the US-stock market recoups its early losses in the months ahead, it could come under renewed selling pressure again. In other words, the investing landscape has become more treacherous.
That’s especially true because the S&P-500 index is fast approaching its fifth birthday on March 9th. And at 59-months old today, the “Least Loved” Bull rally is 4-months beyond the median age of the Top-12 Bull markets in history. As it enters its retirement years, it becomes frail, and more vulnerable to unexpected shocks. Traders that study cycles have also noted that the S&P-500 index hasn’t suffered a correction of -10% or more for 30-months. That’s remarkable, since historically, -10% corrections happen about 20-months apart, on average.
Not to forget the stock market will have to deal with the Fed’s dialing back its high octane liquidity injections, a policy shift that will force the QE-addicted stock market to stand on its own two feet. Most traders are completely unaware that the Fed has already started draining excess liquidity on a daily basis, through reverse repo operations. On Feb 4th, the Fed drained $106-billion at 3-bps from 60-bidders. Thus, the Fed is partly sterilizing its QE-injections, which in turn, is helping to support the US$’s exchange rate. Still, investors can expect the “Plunge Protection Team” (PPT) to intervene in the stock index futures markets, whenever panic selling erupts, in order to prevent a disorderly slide from turning into a horrific crash.
…
Turmoil in financial markets
Goldilocks and the bears
Investors have been forced to reassess their rosy view
Feb 8th 2014 | From the print edition
EQUITY markets started 2014 in a buoyant mood, after 30% gains for American shares in the previous year. Investors seemed to believe that the worst of the financial crisis was at last over and that the global economy was returning to “Goldilocks” mode, with growth neither so strong as to cause inflation nor so weak as to squeeze profits, but “just right”.
However, markets have been hit by a classic one-two punch in the opening weeks of the year. First, emerging-market currencies came under pressure, with the Argentine peso and Turkish lira, among others, falling sharply and several countries opting to increase interest rates. To add to the concern, Chinese economic data showed signs of weakness, with the purchasing managers’ index for manufacturing dropping to 50.5 in January, its lowest level in six months.
The second sandbagging came from America, where the purchasing managers’ index for manufacturing slumped to 51.3 in January from 56.5 in the previous month. That was accompanied by a 3.1% decline in vehicle sales in January compared with a year earlier and followed a surprise 4.3% fall in durable-goods orders in December. The news prompted a 2.3% fall in the S&P 500 index on February 3rd. Most analysts had dismissed weak employment numbers for December as an aberration due to exceptionally cold winter weather, but the run of disappointing statistics seems to have stirred second thoughts. Payroll data for January, which were due to be released after The Economist had gone to press, may assuage or amplify these misgivings.
Underlying all this is a third potential worry. The Federal Reserve’s policy of “quantitative easing” (creating money to buy assets) is widely credited with propping up equity markets as well as depressing bond yields. Now that the Fed is “tapering”—that is, gradually reducing—its asset purchases, will the markets come under prolonged pressure?
…
Is inflation or deflation a more likely near-term prospect?
Week in FX Europe - ECB Holds Rates As Deflation Fears Rise
Weekly Forex Fundamentals | Written by MarketPulse |
Feb 08 14 03:13 GMT
With the Eurozone affected by very weak inflation, the markets were waiting to see if the ECB would take any action on Thursday. With the benchmark interest rate at a record low level of 0.25%, clearly there isn’t much room to reduce rates, but there was talk of lowering deposit rates below zero. Such a move would likely hurt the euro due to investors dumping their euros in favor of other currencies. When this didn’t happen, the euro jumped, gaining about a cent after Draghi’s press conference. Draghi then reiterated what we’ve heard many times over, which is that for the foreseeable future interest rates will stay at their current levels or could go even lower. What action, if any, the ECB takes when it sets rates in March will be heavily influenced by the inflation situation in the Eurozone. If inflation weakens further, the ECB will be under strong pressure to make a move, such as lowering deposit rates.
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If the taper continues then deflation. Housing prices will continue to fall again.
I don’t think they can let that happen though. So no significant deflation is coming in the short term.
They must save the Spring!
liquidate your real estate while you still can!
There is no panic from sellers yet. If current trends continue, by late May they will be liquidating in their pants.
And this time there’ll be no hedge funds to put in the floor.
It is time for a twist from the fed and other PTBs to prevent prices from continuing to drop. The jobs report clearly shows the economy is still in the crapper as it has been for the last several years.
experts are saying the real estate will hold steady this year.
The recovery is real cause they say it is.
In Stealtor speak “hold steady” translates to a drop, they are incapable of saying it will fall. I mean I get this, if they say a fall then it makes no sense not to wait.
Dynamic markets do not hold steady.
“…experts are saying the real estate will hold steady this year.”
Are those the same experts who insisted there was no bubble circa 2006?
“I don’t think they can let that happen…”
There are plenty of small countries left for us to destroy economically with our exported dollars!
Taper delay is on the way…it’s only a matter of when, not whether.
Taper delay is on the way ??
Maybe….Maybe not….Yellon needs to build credibility…If she reverses what Ben set up and it backfires, she is toast…
I say she continues with the taper to its end BUT in forward guidance will send clear messages that interest rates will remain low…May even indicate that they will remain low further out then Ben previously has indicated…That, IMO, will allow the markets to go risk-on….
IMO, I believe the broadside black-swan is still the big threat…
“I say she continues with the taper to its end BUT in forward guidance will send clear messages that interest rates will remain low…”
It’s important to differentiate between the short and long ends of the Treasury yield curve. When FOMC members indicate ‘interest rates will remain low,’ they mean that traditional monetary policy will be used to keep the Fed Funds Rate pinned to the mat, thereby holding short-term interest rates to near zero. So long as this policy remains in place, it provides an anchor on how high long-term Treasury yields can go despite tapering, which I guess explains why I increased my portfolio allocation to long-term Treasurys after the 30-year T-bond took a 15% body blow last year. Bill, just south of Irvine might describe this as an easy “buy low” strategy.
which I guess explains why I increased my portfolio allocation to long-term Treasurys after the 30-year T-bond took a 15% body blow last year.
What made you so sure at the time that it wouldn’t continue to decline in value past the 15% that it had already moved?
I could see rates go negative if we get a bump-up or even a stall in the unemployment rate…
“I increased my portfolio allocation to long-term Treasurys after the 30-year T-bond took a 15% body blow last year. Bill, just south of Irvine might describe this as an easy “buy low” strategy.”
Why yes. Particularly relative to other asset classes.
Here is a quote I just saw and am now plagiarizing because it is so good: “You know my investing mantra: You want to buy what’s 1) cheap, 2) hated, and 3) just starting an uptrend.”
When so many a$$clowns are insulting you for favoring an asset class that has been beaten up, and when it’s cheap and when you start to see an uptrend, that’s when you buy.
December-Januar looks to me like a turning point in cycles in two or three asset classes. And in some sectors within stocks themselves. So exciting!
“When so many a$$clowns are insulting you for favoring an asset class that has been beaten up, and when it’s cheap and when you start to see an uptrend, that’s when you buy. ”
- Then three years later you tell the very same a$$clowns that you loaded up on that same asset and they tell you that you are lying.
“What made you so sure at the time that it wouldn’t continue to decline in value past the 15% that it had already moved?”
Long-term Treasury yields are tethered to the short end of the yield curve, and the Fed has repeatedly announced their intentions to pin the short end to the zero bound into the indefinite future.
“…tethered to the short end of the yield curve…”
In case this is not obvious to you, I recommend reading the chapter in John Cochrane’s Asset Pricing book which covers the term structure of interest rates. Not easy reading, and you will have to both put pencil to paper and write computer programs to really understand the material, but once you do this, my point will become clear.
Better yet, consider taking this free online course the next time it is offered.
Long-term Treasury yields are tethered to the short end of the yield curve,
What is the force, or mechanics, that so tethers them?
“What is the force, or mechanics, that so tethers them?”
The no arbitrage principle coupled with rational expectations.
Read the book.
I love investment books. So many great, and very rational theories. So few theories that consistently work.
And I haven’t read the book.
And before you think I’m getting snippy, I studied a lot of investment theory. The funny thing about all the theories is that if they worked, then there should be MUCH less volatility in markets. There are lots of other things at play (psychology, natural business cycles, government intervention), that make the theories hold to a lesser extent than they SHOULD based on the theory.
I firmly believe in the truth of the following:
“Markets can remain irrational a lot longer than you and I can remain solvent.”
Given the unprecedented nature of the Fed intervention, I would be very nervous about relying upon books related to yields. We have been experiencing the distortive effects on long-term yields of the Fed buying approximately 100% of the newly issued GSE backed MBS, and about 35% of newly issued treasuries–no one can possibly know what will happen (and various knock-on effects) when the buying stops.
BTW, one of the topics covered in his book, the CAPM pricing model, is one that I studied extensively.
The punch-line at the end of the class, was that in theory the model is sound, but in practice, it doesn’t really work.
Ironically, even though the model doesn’t work in practice, you find very sophisticated investment professionals use terms like “generating positive alpha” and “beta” as part of their normal parlance.
In other words, the CAPM pricing model has created a common and accepted framework by which to think about the market, but its predictive capacity is VERY limited.
Alright, who has been feeding the horses bath salts again?
CBS 12 News
7 hours ago
CBS 12 Reporter bit by horse.. caught on tape.
watch it here
CBS 12 News - West Palm Beach, FL - Broadcasting & Media …
https://www.facebook.com/CBS12News - 1005k - Cached - Similar pages
Fifty years ago Sunday, on Feb. 9, 1964, via “The Ed Sullivan Show,” America met the Beatles.
Oh yeah, I’ll tell you something
I think you’ll understand
When I say that something
I wanna workout plan
I wanna workout plan
I wanna workout plan
Oh, please, say to me
These loan Docs will not stand
and please, say to me
I’ll get a workout plan
I need a workout plan
I wanna a workout plan
Back in the Bubble I felt happy, inside
My value trippled
So my house
I refied
I refied
I refi-i-i-i-i-i-i-i-i-ied
Yeah you, got that something
I think you’ll understand
When I say that something
I wanna a workout plan
I wanna a workout plan
I wanna a workout plan
I wanna a workout pla-a-a-a-a-a-a-an
HARP, I need somebody,
HARP, not just anybody,
HARP, you know I need someone, HARP.
When I was younger, so much younger than today,
I refied three times thought I’d never have to pay.
But now these days are gone, I’m not so self assured,
Now I find I’ve changed my mind they’re knockin’ on my door.
HARP me if you can, I’m upside down down
And I do appreciate you being round.
HARP me, get my feet back on the ground,
Won’t you please, please HARP me.
And now my life has changed in oh so many ways,
My wife and her boob job have vanished in the haze.
But every now and then I feel so insecure,
I haven’t paid in like three years, I don’t think I’ll make four.
HARP me if you can, I’m upside down down
And I do appreciate you being round.
HARP me, get my feet back on the ground,
Won’t you please, please HARP me.
As always, jeff, great job!
I love this blog!
Yes, that was funny and fun to read….
Eleanor Rigby
Died as a renter…
Any buyer who pays for a real estate agent is a moron. Sellers agents at least list the property, throw open houses and take some photos. Buyers agents do nothing. Today everyone finds their house themselves on the internet.
Seriously, what is the benefit? And what is the benefit that outweighs paying 3 percent?
a buyers agent doesn’t cost u anything as a buyer. would you rather pay the sellers agent 6% or have a buyers agent and have them split the commission 3% each?
Do you think a sellers agent can do a good job for you even though he represents the seller too?
a buyers agent doesn’t cost u anything as a buyer. would you rather pay the sellers agent 6% or have a buyers agent and have them split the commission 3% each?
Or you could be smart, and make the offer directly to the seller’s agent, and include in your offer a provision that most of that buyer’s-side 3% is rebated to you.
I made that mistake once, back in the early ’90s. But I was young and ignorant, so I chalk it up as tuition. I won’t make the same mistake again, though.
Now I am really laughing. Sing it Amy…finish the whole song.
Eleanor Rigby, picks up the trash
In the house where the Deadbeats had been
They lived in a dream
Waits at the window, wearing the face
That she keeps in a jar by the door
Who is it for?
All the foreclosed people
Where do they all come from?
All the foreclosed people
Where do they all belong?
I’m laughing so hard that you’re making me cough…
Pretty damm funny…
Of possible interest:
The Music of the Beatles
The Music of the Beatles will track the musical development of the band, starting from the earliest days in Liverpool and Hamburg, moving through the excitement of Beatlemania, the rush of psychedelia, and the musical maturity of Abbey Road.
About the Course
The Music of the Beatles will track the musical development of the band, starting from the earliest days in Liverpool and Hamburg, moving through the excitement of Beatlemania, the rush of psychedelia, and the maturity of Abbey Road. While the focus will be on the music, we will also consider how recording techniques, the music business, the music of other artists, and the culture of the 1960s affected John, Paul, George, and Ringo as they created the Beatles repertory.
There is probably no band or artist that has had more written about their music than the Beatles. There are many good books on the band’s biography, several insider accounts offering glimpses behind the scenes, books that interpret the meaning of the songs, and even books that catalog dates and people regarding the band. This course will try to synthesize much of that information into an account of the Beatles’ development as musicians and songwriters.
…
Will the Pineapple Express relieve Cali’s drought?
http://www.mercurynews.com/science/ci_25088877/california-drought-desperately-needed-rain-courtesy-pineapple-express
That’s actually good news. Much as I bash Cali from time to time, I really only resent the state for one reason, and that’s for being ground zero for the invasion. Well, then there’s Feinstein, that’s another good reason. Then again, Florida had those hanging chads…
Yes this is a pretty decent storm but we need a lot more…
Unfortunately I was driving home from the OC to SD a couple of nights back in the only real rain storm we have had since December.
I drove back from Vegas on Thursday threw the storm…Lots of wind and steady slow rain which is good…Thats the type we need…No run off…It perks…
threw = through
I already saw this movie.
Boom, bust and boom again
Posted: 12:00 a.m. Friday, Jan. 17, 2014
By Kimberly Miller - Palm Beach Post Staff Writer
Nicole Moore bounced from Palm Beach Gardens to Boynton Beach to Wellington, visiting 20 properties at nights and on weekends in a dogged pursuit to find her first home.
“We were all over the map,” said the 25-year-old, whose house hunt with her fiancé began in October.
The couple initially struck out — outbid by someone willing to pay asking price. Their second attempt ended similarly. By the third try, they made an offer the same day, accepted a higher counteroffer, and will pay cash for the more than $200,000 purchase.
Such goes the search for homes in Palm Beach County.
The market bottomed out in 2011, three long years after the death of Lehman Brothers and the birth of the Great Recession.
But the rebound has been swift. The double-digit ascent in median sale prices had heads spinning in 2013 as economists worked overtime to dissect the harrowing climb and tamper enthusiasm with predictions of a price slowdown.
In Palm Beach County, the increases buoyed home values from the tony streets of Palm Beach to the green border of the Everglades, and motivated developers to snatch up remaining swaths of land in multimillion-dollar deals that bank on baby boomers to drive a lasting market.
Fueled by corporate investors and Wall Street hedge funds, ZIP codes countywide have seen gains, rebounding as high as 47 percent from the bottom of the market, according to an analysis of median home values through October conducted by Seattle-based Zillow.
Zillow economists said 2014 will see Palm Beach County’s median home values gain another 5.8 percent, ranging from 4 percent in Boynton Beach to nearly 7 percent in West Palm Beach.
Others are even more optimistic. South Florida housing expert and consultant Jack McCabe predicts Palm Beach County’s median sales price for a single-family home will jump 8 percent in the coming year.
http://www.mypalmbeachpost.com/news/business/boom-bust-and-boom-again/ncp66/ - 87k -
Did anyone here catch Leno’s final bow? I’m sorry to say I missed it, although I did see the clip of the last six minutes, it was sort of poignant. I had no idea he was such a fan of Garth Brooks, and had Brooks close out the show with “Friends in Low Places”.
What bothered me, though, was Conan taking pot shots at him (I don’t care what happened, Conan never was and never will be the right person to take that slot and his behavior over the whole incident demonstrates why) and a belittling piece in Slate, “I Almost Feel Sorry for Jay Leno”, written by a real stoopid cvnt of a braying arse critic. Two gnats flinging poo at a giant.
With that said, I’ve changed my mind about Fallon. Much as I’ve excoriated him in the past for sophomoric humor, I have a feeling he’ll step up to the plate and do just fine. That’s based on a recent special of his that ran on NBC.
Leno seems pretty lucky beyond all proportion to his actual talent. He’s a lotto winner with over a hundred cars and 25 plus motorcycles in his garage.
Never feel sorry for a man with a plane.
Fallon comes across as too young. It isa Hail Mary play for younger viewers that will fail.
Leno brought the ratings, which is what his bosses (ugh) expected of him. He did a good job all these years. I don’t feel sorry for him at all, and as he showed on 60 minutes, he knew the score. And he knew what his bosses were like, hence the many potshots he took at NBC, which were well deserved.
As to Fallon, I would have agreed with you at first, but after seeing his special, I think he can bring it. And if he could convince me, I think he can convince others. In fact he may not get as many of those younger viewers as they thought, but yet draw in many older viewers. I think he can have a foot in both camps. His rock star parodies are priceless.
Younger viewers are worth more, so fallon wont need the same ratings. That said, it will be hard for anyone to add younger viewers on network tv. Most young people cant tell you what channel nbc is on their tv. Why? NETFLIX.
Also, adult swim is funnier, more original, and gets more views thanany of those lame, tame “late night” network shows.
Liberace!
The whole thing is wacky. I think Letterman is funnier, but I only watch him maybe three times a year. Who can stay up that late during the week? I don’t understand why Leno beat Letterman so consistently in the ratings, but the important fact is that he did. If I was in charge of NBC I was mostly be concerned with that fact. It’s nearly impossible that Jimmy Fallon can get better ratings than Leno, even though he is quite talented. The sensible thing for NBC would have been sign Jay up for a few more years.
“The sensible thing for NBC would have been sign Jay up for a few more years.”
That’s been said by more than a few, but NBC didn’t want Fallon to jump and they wanted to crank up the appeal to a younger demographic. Time will tell if they did the right thing. Like in a month.
Letterman lost me after the whole fiasco with his staffer, he seemed to become a caricature of himself after that. The constant mugging for the camera got to be a little painful to watch.
Funny you should mention about staying up that late during the week, I really can’t handle it on a consistent basis myself. What’s weird is that it didn’t seem to bother my father and others of his generation, who watched Carson religiously.
“Never feel sorry for a man with a plane.”
+1 Gotta borrow that one. Thanks!
Murder Charge Dropped Against Man who Killed Cop in No-Knock Raid
Grand jury sides with self defense, Fourth Amendment
Adan Salazar
Infowars.com
February 7, 2014
In an astonishing decision, a Texas grand jury refused to indict a Central Texas man Wednesday for shooting and killing an officer who entered his home serving a warrant unannounced, an outcome the man’s attorney says he’s never witnessed in his half-century long career.
On Dec. 19 just before 6 a.m., Burleson County Sgt. Adam Sowders, 31, led a team of investigators in a no-knock marijuana raid conducted on 28-year-old Henry Goedrich Magee’s mobile home in Somerville, 90 miles northwest of Houston.
An informant had told a sheriff’s investigator he had seen 10 to 12 marijuana plants in Magee’s home, along with rifles and a pistol, which were later determined to be legally owned, and that he was a well-known dealer in the area.
Sgt. Sowders obtained a “no-knock” warrant from the county judge on the grounds that an announced entry could rattle a guard dog or would give Magee time to destroy evidence, and would ultimately be “dangerous, futile, or would inhibit the effective investigation.”
When Magee heard strange noises coming from within his home, he “thought he was being burglarized, reached for a gun and opened fire,” Magee’s attorney, Dick DeGuerin, argued in court.
Magee was charged with capital murder, at which point prosecutors had to prove, beyond a reasonable doubt, that he knew Sowders was a peace officer before he killed him.
“This was a terrible tragedy that a deputy sheriff was killed,” DeGuerin stated in an interview, “but Hank Magee believed that he and his pregnant girlfriend were being robbed.”
Burleson County District Attorney Julie Renken was tasked with proving Magee murdered Sowders in cold blood, and contended that officers did indeed make an announcement prior to entering.
The events “occurred in a matter of seconds amongst chaos,” Renken said. “I believe the evidence also shows that an announcement was made,” she argued, according to the Associated Press. “However, there is not enough evidence that Mr. Magee knew that day that Peace Officers were entering his home.”
According to the D.A.’s own admission, however, a capital murder charge was pursued with full knowledge that there was insufficient evidence to establish the case.
“If there was not enough evidence that Magee knew Sowders was a cop rather than an armed robber, why did Renken try to indict Magee for capital murder?” asks Forbes contributor Jacob Sullum. “It was the police, not Magee, who created the ‘chaos’ in which Sowders was killed.”
Additionally, says Sullum, the demonstrably futile “war on drugs” is to blame. “His death is doubly senseless: because violence is not an appropriate response to cultivation of an arbitrarily proscribed plant and because, even if we take pot prohibition as a given, there is no need to enforce it by breaking down people’s doors while they are sleeping, a tactic that inevitably results in tragedies like this one.”
The grand jury’s decision is a win-win for everyone; after all, the Fourth Amendment reaffirms the “right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures..”
The decision also respects legislation outlined in S.B. No. 378, Texas’ version of the “castle doctrine,” which permits the use of deadly force when an “actor” believes someone has “unlawfully and with force entered, or was attempting to enter unlawfully and with force, the actor’s occupied habitation..”
As Magee’s attorney correctly summarized, “He did what a lot of people would have done. He defended himself and his girlfriend and his home.”
“Well we feel that the grand jury acted fairly and reasonably and had all of the information that it needed to make the decision that it did. That is that this was a justified shooting and, but we need to say that this is a tragedy,” DeGuerin added.
The move to pursue a capital murder charge despite lack of evidence illustrates how far police attorneys will go to defend their own, while at the same time unwittingly attempting to undermine their own rights.
Unable to get the murder rap to stick, the district attorney says felony drug and weapon charges against Magee will be “fully prosecuted.” He remains in jail with bond set at $50,000.
The move to pursue a capital murder charge despite lack of evidence illustrates how far police attorneys will go to defend their own ??
There is the money sentence right there….And, this guy is going to get buried on the other charges….
“And, this guy is going to get buried on the other charges…”
+1 Death will likely come as a relief; cop killers make great baton dummies especially in Texas.
Two guys just released after 21 years in prison in New York after DNA proves they did not do it…Should put the DA in prison for the next 21 years…Ah but they have that little thingy called immunity from prosecution…And we wonder why they prosecute they way they do…
that little thingy called immunity from prosecution
The King can do no wrong. It’s nice to be the King.
IANAL, but I believe the District Attorney is free to return as many times as necessary to another grand jury to get a murder indictment.
It is very puzzling that Mr. Magee was not “judicially executed” on the spot by the other LEO’s who must have been present. They would have been “legally” justified in so doing. Other articles easily found on the internet indicate the SWAT team on the scene were not wearing body cameras, hence no other evidence seems to exist. The judge who approved the warrant is, of course, utterly blameless since he is “legally” incapable of doing wrong.
Posting again because I got into the conversation pretty late last night.
I find myself in an enviable position compared to my fellow 20-somethings, yet am still unable to afford a home in San Diego. I am 25 years old, have $90,000 in savings towards a home, absolutely no debt, 800+ credit, and a $100,000+ job with generous benefits and retirement. I don’t mention these stats to brag, just to give an idea of where I am at in life. I am very fortunate and thankful for what I have.
I keep constant tabs on the San Diego market, yet can’t justify these insane prices for even a townhome in a respectable area. Starter homes go for $400k+ and condos $350k+. How can I be in this position and unable to justify purchasing when my fellow young professionals are likely nowhere near my savings? Something is seriously wrong with this market, and I am more than happy to wait it out. I have learned from older coworkers who found themselves massively upside down on homes purchased during the bubble, and don’t aim to repeat their unlucky mistakes.
Keep renting…it won’t be long now. Your time is coming.
OTOH, you may wish to see how you can make that $90,000 work for you.
Keep renting…it won’t be long now. Your time is coming.
That’s what I’ve thought for the past six years…
So my advice would be to try to reach acceptance of the insanity; if you reach that point, it won’t bother you even if it takes a long time.
“That’s what I’ve thought for the past six years…”
But did you see the extraordinary government intervention to keep the bubble alive at all levels of government? I certainly didn’t see that coming.
It’s important to keep perspective on the reasons it is taking the bubble so long to end, and also consider whether it might continue for longer than your period of potential participation in the real estate market. In our case, we weren’t so much priced out of the market forever, as our housing needs evolved to the point where we are no longer potential buyers in the family-sized SFR market. I have to guess many other late baby-boomers are facing the same situation we are, which suggests that future demand for 3-4 br SFRs may soon appear to be toast relative to a burgeoning supply generated by aging Baby Boomers all trying to cash in their accumulated home equity gains at the same time. Maybe the Fed can intervene to hold enough of these empty nests off the market to prop up prices forever.
But did you see the extraordinary government intervention to keep the bubble alive at all levels of government? I certainly didn’t see that coming.
I did anticipate that they would try extraordinary intervention; where I went wrong was in underestimated the effect of said intervention. It was far more successful at propping up financial markets than I anticipated that it would be.
Live and learn!
Here is what you need to realize and keep in mind for your future. 100k+ job in San Diego does not let you live the kind of lifestyle of an average middle class family 20 years ago in a normal part of the country.
You need to make plans to port your job or skills somewhere else while making comparable money. It will never work out in San Diego and your clock, at 20 something, is ticking faster than waiting around to see if things eventually crash will let you.
He should move to sf/sv, he’ll make more money and he should continue renting and saving. outside of a few areas, the demographics of sd look bleak. But he can move back when the housing bubble crashes, if he wants. Or use his money to afford a better lifestyle elsewhere. Prices in la jolla probably wont crash as much as vista or oceanside or poway, for example. They’ll probably stay higher than its worth.
SF/SV is an even worse situation. All the high priced areas of California are now out of the reach of non-rich people if they want to have any kind of decent life. The rest of the state is overrun, overcrowded, still overpriced and a much worse place to live than most of middle America. If you value your family, you eventually learn and move out.
If you don’t get out, you go crazy with stress, commuting, never seeing your kids, etc., and end up easing your pain with happy pills from the pharmaceutical-psychiatry industrial complex just to get by.
I’m telling you, get out now while you can and while you are young. You will look back in a few years like a person who left an abusive relationship, wondering what in the heck you were thinking.
“…get out now while you can and while you are young. You will look back in a few years like a person who left an abusive relationship, wondering what in the heck you were thinking.”
I did this 10 years ago in NYC. One of the guys I worked for just scored a Disney flick with an 80+ piece orchestra.
I would caution anyone against “getting out” if you’re in a position that is impossible to return to if you leave.
Maybe take an extended vacation for 1-2 months and travel the world.
Kinda like here muggy…its been a gawdsend having free off street parking no alt side parking tickets plus by shoveling the snow out the long driveway….I dont have to worry about the dozen cars still iced in their spots
Its like baby jeebus heard my cries and sent the millenial reinforcements.
“I am 25 years old, have $90,000 in savings towards a home, absolutely no debt, 800+ credit, and a $100,000+ job with generous benefits and retirement.”
Keep your powder dry, as unless this bubble is unlike any other in the historical record, prices will eventually revert to normalcy, and may even overshoot to the downside of the long-term trend.
If you expect to be around for a few years, at least wait until the aftermath of the next recession, which is when unemployment predictably increases and housing prices soften; this is the strategy that enabled me and my wife to purchase a home two decades back.
If you don’t expect to stay in SD, don’t buy, unless you want to enjoy the risk of catching yourself a falling knife.
Keep voting obama - things will get better one day.
Plus it is so kewl to have a black president…
Keep voting obama ??
I would but I can’t…
Plus it is so kewl to have a black president ??
Not as kewl as having a woman president…
Get over your denial, dude — Obama’s last term ends in three years, at which point the first female American president, Hillary Clinton, will continue to maintain the PERMANENT DEMOCRAT SUPERMAJORITY.
“How can I be in this position and unable to justify purchasing when my fellow young professionals are likely nowhere near my savings?”
You really need to celebrate your youthful wisdom with a quiet dinner for two over-looking the Pacific coast. Park your cash in a liquid account safe from the flesh-eating commission hyena and wait for the market correction to shake-out. As the others here point out look at the index funds.
Some thoughts:
• Focus on building net worth.
• There’s nothing wrong with renting. The big argument against goes, “At the end of 30 years, we’ve got this 500,000 dollar asset and you’ve got nothing.” Not entirely true - money you saved from renting now counts to your net worth. In my experience, the net result is that owning is twice the cost of renting.
• Also, with owning, the popular misconception is housing costs drop to zero. Not so - you always have the TI-UM of the PITI-UM: Taxes, Insurance, Utilities, Maintenance. Heating and cooling the large spaces of a McMansion is not trivial. Nor is maintenance. It doesn’t drop to zero. Ever.
• On the other hand, I do agree that it is better to raise kids in a detached house. They can be loud, they can run around outside. Much better than a low- or high-rise apartment.
• Also, it is nice to have a fixed payment versus increasing rent.
My recommendation: Look outside your bellwether zip code. If you must live in the hot zip code, and especially California, you’re competing with foreign investors (Chinese in particular - this could get interesting as China slows down) - AND - people who had houses before the bubble. They might have spent a hundred thousand on the house in 1990 and now they’ve got 700K to work with. You don’t want to compete against these people.
I don’t know when the change is going to happen. People like you are going to become more prevalent. And in England: “Polling by Ipsos MORI shows that a majority of people now regard rising house prices as a bad thing.”
Understand that this current housing system - with the government making or backing nearly 100% of all mortgages (via FHA, VA, USDA, Ginnae Mae, Freddie Mac, Fannie Mae), and with the FIRE sector as the far and away biggest contributor to politicians - is totally artificial. It is the crown jewel of crony capitalism. As a result of that though, it is subject to political pressure.
However… I don’t know when it’s going to change. I am confident it will change, as more like you become adults. Politicians are ultimately responsible for this system as they write the laws to encourage it. And they’ll change it in response to political pressure.
My $0.02: Perhaps seek to rent a SFH if you’re looking to raise kids. Or look outside San Diego, in another city or in a cheaper suburb. Don’t get pushed into a bad area IMHO, as that causes a whole new round of issues which are hard to put a price on, but as real as a broken bone. Look outside San Diego. It’s a big country.
Also, beware of realtors and lenders blowing sunshine up your a••. If a person wants to believe something, and someone tells them that thing, they’ll believe it. It’s a human flaw. Their interest is in the fees, interest and transactions, and even “your” realtor doesn’t work for you - he works for the seller. He’s paid a percentage of the price of the house so while his principles may say that he’s supposed to look for you, his interests lie with the seller, in doing the deal as quickly as possible at as high a price as possible.
And there it is.
Why is that that owning is twice the cost of renting? One simple word….. Depreciation. You see….. those starry-eyed debt donkeys who wouldn’t ever pay current prices out of their own pocket if they had the cash need some way to make the math appear to work. How do they do it? They understate or entirely exclude the cost of depreciation. Depreciation is an enormous number every year, year after year. Add it up after 30 years and you just doubled your principal costs. And you haven’t even stacked borrowing costs, taxes and insurance on it.
I challenge anyone of you who has made the prudent wise decision to rent and are thinking of making the tragic error of levering up for a depreciating asset like a house….. Ask yourself this question;
If you had $500k in cash, knowing everything you’ve know and learned here….. Would you dump it into a house?
“At the end of 30 years, we’ve got this 500,000 dollar asset and you’ve got nothing.”
That argument may be true for those who fritter away the monies saved by renting, not owning, on consumption rather than savings.
But those who blow their home equity on consumption can easily spend themselves into an underwater position that eventually leads to them getting foreclosed and having nothing to show for years of supersized mortgage payments.
“At the end of 30 years, we’ve got this 500,000 dollar asset ??
What its worth is really unknowable & irrelevant…If you bought a house at 25 then at 55 you now own the house free & clear which lowers your cost vs. renting going forward…
So, part of the rent vs. buy equation should also include renting from 55 until death…
True enough. But it should also take into account liquid funds (the homeowner has 500k in the house, the renter has 500k in liquid assets, for example). The homeowner can’t tap his funds unless he sells the house or puts the house up as collateral for a loan.
Also, the comparison should be rent vs. TI-UM, not rent vs. nothing. Because the TI-UM doesn’t go away after the mortgage is paid off.
“What its worth is really unknowable & irrelevant…”
Now theres a real beaut. Here’s an idea….. Less than the cost to build it. Start there with the reductions.
Neuro:
It should really be Rent/I/U vs TI-UM. Unless you are a risk-loving guy, you should really have renter’s insurance, and you still need to pay for utilities. While it’s certainly cheaper than homeowner’s insurance, it’s not insignificant. When I was renting, it was about 25% of one-month’s rent. Now that I own, my insurance cost is about 35-40% of one-month’s interest cost.
Replace San Diego with Washington DC and 25 with 37, and that’s my story. I consistently look at RE around here, but I just choose not to buy. I don’t care what everyone else is doing, I’m happy renting especially with insane prices out there. I don’t have debt, I don’t have headaches, I live a nice life.
Like someone else said focus on building up that DP for when, yes when, this market sinks. Like my old baseball coach used to say: “Use your time to prepare, use your preparation for when it’s time”
“Use your time to prepare, use your preparation for when it’s time.”
Beautiful advice. Here is a classic version:
And be patient. I expect this cycle will play out with roughly the same timing as other cycles.
I had the same frustration in my 20’s (very good income, good down payment, etc.), and given that my business is real estate, there were plenty of people joking about how of all people, I should buy a house…a few guys saw it like I did…as consumption, and they were far less critical.
I prepared, built up my down payment/net worth and I rented until my mid-30’s. When I acted (in early 2011), I did so after watching my target market for a very long time, and so could act with conviction. I am very comfortable with the path that I took.
No wonder you religiously believe in the housing mantra. You’re so young that all you’ve seen is financial manias like grossly inflated housing.
I agree with everyone who tells you to continue renting.
Yes, I admit, I bought a house and I defend that decision. But my situation in life is very stable. I don’t anticipate changing careers or locations or status and I had to start thinking about that time of retirement. That favors buying.
On the other hand, you’re young and portable (IT? law?) and likely to find a girl soon (if not already) and you likely won’t stay in SD. You should not be buying yet. Save your cash.
It’s price that determines. Not your “situation in life”.
Silly Donkey.
“…and likely to find a girl soon (if not already)…”
Any split-tail worth a second date can spot assets and success faster than a lion can spot a limp, and when you have $90,000 in savings, absolutely no debt, 800+ credit, and a $100,000+ job with generous benefits and retirement, the ladies find you. Right?
“I am 25 years old, have $90,000 in savings towards a home, absolutely no debt, 800+ credit, and a $100,000+ job with generous benefits and retirement. “
Advice for Kristopher:
Live cheap, avoid emotional temptation of marriage. Listen to divorced men 15 or 20 years older than you. Don’t listen to any religious people discussing marriage. THEY ARE LYING. They only are chanting the slogans that they think they are supposed to.
Save as much as you can in stock index funds. You should have a base of six months living expenses in cash. Other than that everything else you should have in stock index funds. Contribute to a Roth 401k if you can up to where you get 100% matching contributions from your employer. Then with extra money you have invest outside tax deferral in stock index funds.
Know this: The best pay is usually in the biggest cities. They are expensive, but the good news is that renting a place is far cheaper than owning a place. If you are an extrovert you won’t mind living with others (I like my privacy and prefer to spend more for my own privacy).
Keep short leases. The smart young man is always looking ahead to new opportunities in his career, establishing his network in his profession, never burning bridges. When you become vested in your 401k (which means you own 100% of all your matching contributions) and you have maybe three or four years at a company and you see a much better opportunity, keep an open mind for moving there, even though it could be 2,500 miles away.
Don’t gather much material possessions - it’s harder to move them and you will be more reluctant to take the opportunity of your dreams - someone more mobile than you will snatch that opportunity and go into the end zone with it.
A suggestion if you don’t have any pets - don’t get one. They add to the burden of moving around. Some apartments do not allow pets. Some charge high fees for pets.
In 1989 at age 30 I had $1,000 net worth. I started my TSP (a federal employee form of 401k) and by 1995 had a net worth of $50,000. I left government in 1996. In the year 2000 my net worth was $400,000 as a salaried engineer at a Fortune 500 company and my income was at most $65,000 in 2000. Then I became more mobile and became a consultant and my income doubled. Once I made almost four times what I did in 2000. With all the excess income I had I kept saving. My net worth today is $1.73 million, of which $1,000,000 is in stocks and stock mutual funds - most of that amount in my tax deferred accounts. In 25 years I went from having $1,000 to $1.73 million by mostly living cheap so I could save more. I crossed my first $million in 2009, a year earlier than the goal I made in 1999.
I am sure you can easily get to $5,000,000 by age 50.
Ben Bernanke Joins Globalist Think Tank
William F. Jasper
New American
February 8, 2014
The question about what Ben Bernanke would be doing now that he’s retired from the Fed has been answered. The ex-chairman of the Federal Reserve is the newest fellow at the Brookings Institution, one of the most influential “progressive” think tanks promoting world government (or “global governance,” the euphemism the internationalists prefer to use today).
“Today we at the Brookings Institution and its new Hutchins Center on Fiscal and Monetary Policy are excited to welcome Ben S. Bernanke as a distinguished Fellow in Residence,” announced David Wessel, director of the Hutchins Center, in his February 3 Brookings blog.
“Mr. Bernanke, of course, has just finished eight tumultuous years as chairman of the Federal Reserve,” Wessel continued. “He was sworn in as Fed chairman in early 2006 unaware that fissures were opening in the foundations of the U.S. economy and financial system.”
Wessel then goes on to laud Bernanke as the “rescuer-in-chief,” the indispensible man who saved the global economy. Says Wessel:
Two years later, he was rescuer-in-chief during the worst financial crisis in 75 years. His mantra: Whatever it takes. As Glenn Hutchins, vice chair of the Brookings board, put it at the recent Hutchins Center inaugural event: “Despite the massive deleveraging of the last few years, we are still deeply in debt to Ben Bernanke.”
Full article here
BIG BETS & BLACK SWANS - Memorandum to the President |
January 23, 2014
Close the Deal on Free Trade
By: Mireya Solís
To bring the ambitious trans-Pacific (TPP) and trans-Atlantic trade negotiations to a successful conclusion, Mireya Solís recommends President Obama engage Congress more proactively to secure trade promotion authority, redouble efforts making the public aware of the benefits of the trade agreements, and negotiate consistent standards across trade agreements that can be disseminated globally.
Close the Deal on Free Trade | Brookings Institution
http://www.brookings.edu/research/papers/2014/01/close-deal-free-trade-solis - 90k - Cached - Similar pages
Jan 23, 2014
Tell Congress to Stop Obama’s Secret Trade Deals
The Trans-Pacific Partnership (TPP) is a new “free trade” agreement being negotiated between the U.S. and 11 other Pacific Rim countries. Like other Free Trade Agreements, this one is basically a permanent power grab by corporations and financial companies that will make it impossible for the citizens of countries joining the TPP to choose what laws and rules they want to live under.
For Americans, it would lead to increased gas exports and increased imported foods, while undermining our domestic laws and increasing the financialization of nature.
TPP was started under George W. Bush but is being pushed — hard — by President Obama. In fact, a bill in Congress would give him “Fast Track” authority for the negotiating, meaning that he, and whoever comes after him, would be able to negotiate as desired without oversight by Congress. Isn’t the reason our constitution created three federal branches — executive, judicial and legislative — to ensure checks and balances?
https://secure3.convio.net/fww/site/Advocacy?id=623 - 41k -
More Than Half Million Americans Enter Movement to Stop Trans-Pacific Partnership
Wed, 2/5/2014
This article originally appeared on Popular Resistance
“It’s time for those in power to read the writing on the wall; people from across the political spectrum overwhelmingly oppose anti-democratic Fast Track legislation, and we won’t allow decisions that affect all of us to be made behind closed doors.”
Steve Anderson, Executive Director of OpenMedia.org said: “We know that the TPP will make the Internet more expensive, censored, and policed. That’s why hundreds of thousands are speaking out to stop it being rammed through Congress without a debate. It’s never been more important to pick up the phone and tell your Member of Congress to stop Fast Tracking a deal that would criminalize your online activity, invade your privacy, and cost you money.”
Communications Workers of America President Larry Cohen said, “Voters across the political spectrum are energized. They know this deal affects everybody – small business, workers, anyone who cares about about the food we eat, the air we breathe, and the jobs we hold. Americans are asking what kind of future do we want? We don’t want a trillion-dollar trade deficit. We need to reset our trade policy, so that it works for everyone, not just big corporations.”
“The Obama administration’s plan to ram two potentially devastating international trade agreements through Congress appears to be slowing down thanks to widespread opposition, but we’re not taking any chances,” said Ronnie Cummins International Director of the Organic Consumers Association. ”We must stop trade deals that would weaken U.S. and world food safety standards, threaten domestic and international food sovereignty laws, and allow transnational corporations to sue governments for alleged future lost profits unless the corporations are allowed to freely peddle their unproven, unsafe goods with reckless regard for existing food safety laws.”
http://www.occupy.com/article/more-half-million-americans-enter-movement-stop-trans-pacific-partnership - 86k
“…unaware that fissures were opening in the foundations of the U.S. economy and financial system.”
Imagine a weather man staring at his computer, oblivious to the tornado bearing down on the building where he sits, and you’ll get the picture.
I thought he was a republican. Heritage, Cato or AEI would have been better for him, no?
Why brookings?
I thought he was a republican. Heritage, Cato or AEI would have been better for him, no? Why brookings?
You still think the two teams are different, eh?
I suggest that you take a long, hard look at how similar their economic policies are, and how identical their Federal Reserve appointments are…
I don’t but there were people here claiming that Bernanke was a republican.
Is Ben Bernanke a Republican?
Answer:
Ben Bernanke is a Republican.
Bernanke to Republicans: Stop Being the Stupid Party
—By Kevin Drum
| Wed Sep. 18, 2013 3:00 PM GMT
Congressional Republicans have been critical of the Fed’s loose monetary policies for quite some time. Today, the Fed announced that monetary policy would stay loose for the foreseeable future, and Fed chair Ben Bernanke explained that part of the reason for this is….
The austerity crusade of congressional Republicans. The Fed’s official statement noted bluntly that “fiscal policy is restraining economic growth,” and Bernanke expanded on that in his press conference later in the day:
…
and upcoming fiscal debates may involve additional risks to financial markets and to the broader economy.
LOL. Can’t even have a debate or a talk about it otherwise we may just wake up the baby.
Parents everywhere know it’s best to let sleeping babies lie.
Since the Messiah’s “State of the Union” address, GLD and the S&P 500 index charts crossed paths. The Obummer policies have gotten stale and his new proposals are more of the same socialist yammering, but no real solutions.
You were expecting righteous from the clown? Seriously?
Why We Lost The War On Poverty
February 8, 2014 | John C. Goodman
Take a look at the graph below. From the end of World War II until 1964 the poverty rate in this country was cut in half. Further, 94% of the change in the poverty rate over this period can be explained by changes in per capita income alone. Economic growth is clearly the most effective antipoverty weapon ever devised by man.
But we didn’t continue the trend. In 1965 we launched a War on Poverty. And as the graph shows, in the years that followed the portion of Americans living in poverty barely budged. In 1965, 18% of the population lived in poverty. Today we are at 15%, or 50 million Americans. That’s after spending $15 trillion on antipoverty programs and continuing to spend $1 trillion a year.
We now know a lot about how behavior affects poverty. In fact, if you do these four things, it’s almost impossible to remain poor:
1. Finish high school,
2. Get a job,
3. Get married, and
4. Don’t have children until you get married.
So how does welfare affect behavior? In the late 1960s the federal government sought to find that out in what Charles Murray calls “the most ambitious social science experiment in history.”
The experiments were all conducted by social scientists who believed in the welfare state and had no doubt about its capacity to be successful. In other words, they were confident of the answers before the experiments ever began. Their goal was to prove that popular wisdom was all wrong ? that welfare would not cause people to reduce their work effort, to get married less often, divorce more quickly or engage in other dysfunctional behavior.
The experiments were all controlled. Randomly selected people were assigned to a “control group” and an “experimental group.” The latter received a guaranteed income, and the program even used Milton Friedman’s term for it: a negative income tax. The largest, longest and best-evaluated of these experiments was SIME/DIME (Seattle Income Maintenance Experiment/Denver Income Maintenance Experiment) in Seattle and Denver. And the results were not pretty. To the dismay of the researchers, they largely confirmed what conventional wisdom had thought all along. As I reported in “Privatizing the Welfare State”:
· The number of hours worked dropped 9% for husbands and 20% for wives, relative to the control group. For young male adults it dropped 43% more.
· The length of unemployment increased 27% among husbands and 42% for wives, relative to the control group. For single female heads of households it increased 60% more.
· Divorce increased 36% more among whites and 42% more among blacks. (In a New Jersey experiment, the divorce rate was 84% higher among Hispanics.)
Both authors point out that the results are even worse than they at first appear. For one thing, the “control group” had access to conventional welfare available in the 60s and 70s. So this was by no means a pure (welfare free) control group. Also the enrollees were given different instructions about how long they could expect their guaranteed income to last. It turns out that the longer the guarantee, the worse the negative effects.
With the passage of time all these incentives have become increasingly more perverse. For example, over the past 50 years we have added one marriage penalty after another to welfare benefits. There is a very strong marriage penalty in ObamaCare, for example. And even Paul Krugman concedes that the marginal tax rate faced by low-income families is in excess of 80% today. (It actually goes above 100% in many cases.) And ObamaCare will make the penalty for working and earning even higher.
So here is the important public policy question: If it is well established that self-sufficiency is closely related to working and being married why are we “fighting poverty” by doing things that social scientists have known for decades lead to less work and fewer marriages?
Reviewing some of the early literature, I find it very difficult to determine what Lyndon Johnson would have called “success” in the war on poverty. But there is no doubt in my mind what the average citizen thinks success is. The goal is to have people earning enough and saving enough to support themselves above a poverty level income without any help from government.
Do you have a link for this? That part about the poverty rate declining during the period 1945-64 sounds like it must be some sort of guess. I don’t think that the government was measuring poverty during the 1950s. It’s quite possible that it was true, though. The reason was that there was strong economic during that period that was shared pretty equally by all income groups - the rich, the poor and people in between. That, in turn, was made possible by things like strong unions and a minimum wage that was regularly adjusted to keep pace with inflation, two phenomena that have vanished from the economy.
I meant to write, “strong economic growth during that period”
The original article actually has a great chart showing the poverty rate over time; it was easy to find—I just googled the full title and author name.
This from an MSM article about the war on poverty. It’s a short summary of what’s happened to poverty in America over the past 50 years.
There are two things to note here. First, there was a huge fall in the poverty rate throughout the 1960s,and in particular after LBJ announced the War on Poverty in 1964 and followed up with Medicaid, Medicare, greater federal housing spending, and other programs to fight that war. In 1964, the poverty rate was 19 percent. Ten years later, it was 11.2 percent, and it has not gone above 15.2 percent any year since then. Contrary to what you may have heard,the best evidence indicates that the War on Poverty made a real and lasting difference.
Second, since the permanent decline achieved during the 1960s,most of the variation in the poverty rate has been cyclical: it goes up in recessions and down during booms. During the early 1980s recession, the rate spiked, only to fall again when the labor market recovered later in the decade. Same thing with the early 1990s recessions and late ’90s boom. And the current recession has spurred an increase again. The most recent numbers we have are for 2010, and that year’s rate - 15.1 percent - is about as high as it’s gotten since the 1960s.
Http://m.washingtonpost.com/blogs/wonkblog/wp/2012/07/11/poverty-in-the-50-years-since-the-other-america-in-five-charts/
Also, those four points about finishing high school, not having kids unless you’re married and so forth are good ideas, but they’re not guaranteed to keep people out of poverty. There are probably plenty of people who have done all four of those things and are still poor. Many people don’t realize that a large portion of the poor work full time. The reason that so many of them are poor is because we have an enormous number of crappy jobs in this country. If every American followed those four instructions, we’d still have an enormous number of crappy jobs in the country.
I think this misses one of the main reasons why marriage is declining. The law is stacked against the young single man with no money but a great career ahead of him. The young single man can room with other young people in a very pricey area with great jobs, drift to the next city with better job offers and again room with other young people, keep saving the excess money in stock index funds, and become a multimillionaire by age 50 - with the “Bill in L.A Nomadic Principles®” approach.
The key reasons 1) No Fault Divorce 2) alimony, and 3) Community Property.
Even for middle aged men, marriage is a sham. The earnings on your IRA and 401k during marriage is community property, and typically those are your biggest gains.
Does not matter whether you are a man or a woman, you are better off singlee, when you have a high net worth, your earnings on your investments are community property while you are married, so marriage is a big disadvantage in a no fault divorce and community property state.
You make a point that many people don’t realize. It may be true that married people with low-paying jobs are less likely to be poor than their unmarried counterparts. That’s because they have two lucky ducky incomes to pay the costs of running one household. In economic terms a roommate is nearly as good as a spouse.
One of my sisters was able to enjoy living in expensive Santa Barbara for ten years by sharing houses with others. my ex roommate paid no more than $100 per month rent for ten years right out of college through the mid 90s. He built up so much money that he would spontaneously take weeks off from work without pay, going to Brazil for several weeks or Australia for a couple months. He was not materialistic, although drove a used Corvette, which he maintained himself. I have known some of the most well balanced people in my life who knew the way to avoid the rat race and keep stress very low and build up a lot of net worth without killing themselves to make an extra buck. The secret was spending less, not earning more.
“The law is stacked against the young single man with no money but a great career ahead of him.”
Divorce law is stuck in the 1950s, while labor law has almost moved on to the 2020s, when firms which do not hire a woman unless no qualified female applies for a job will be sued for gender discrimination. Men are on the hook for alimony after divorce, even though women have more than equal rights in hiring.
your earnings on your investments are community property while you are married
Bill, I do not believe that is accurate.
My understanding is that separate property from prior to marriage, that is kept separate (e.g. never co-mingled), can generate earnings that are still separate property.
why are we “fighting poverty” by doing things that social scientists have known for decades lead to less work
You mean less work, as in, doing things that exported all the work first to low-wage southern states and later to serf-wage third world states? Good question. Ask your corporate buddies.
This is what happens when you gut the middle class and concentrate wealth.
SARAJEVO, Bosnia-Herzegovina (AP) — Anti-government protesters stormed into the Bosnian presidency and another government building in Sarajevo and set them ablaze Friday as riot police fired tear gas in a desperate attempt to stop them.
Smoke was rising from several Bosnian cities as thousands vented their fury over the Balkan nation’s almost 40 percent unemployment and its rampant corruption. It was the worst social unrest the country has seen since the 1992-95 war that killed over 100,000 people following Yugoslavia’s dissolution.
As night was falling Friday, downtown Sarajevo was in chaos, with buildings and cars burning and riot police in full gear chasing protesters and pounding batons against their shields to get the crowd to disperse.
Nearly 200 people were injured throughout the country in clashes with police, medical workers reported.
Bosnians have many reasons to be unhappy as general elections approach in October. The privatization that followed the war decimated the middle class and sent the working class into poverty as a few tycoons flourished. Corruption is widespread and high taxes for the country’s bloated public sector eat away at residents’ paychecks.
40% unemployment in Bosnia.
When you buy a typical household product today you basically have two choices, top quality or chit, i.e., made in Germany or China, respectively. Or your purchase quality falls somewhere between the two extremes. Unfortunately many places around the planet can’t produce anything better and cheaper than China. Then what, jihad?
To those who were chortling about gold’s drop in 2013 AND DOING NOTHING ABOUT LOADING UP ON IT. Also to those who favor precious metals:
“What Happens After a Market Sector falls by 80% (It’s Surprising):”
http://dailywealth.com/2659/three-reasons-to-invest-in-junior-gold-mining-companies
Congressional Budget Office Increases Estimate of the Cost of Housing Bubble Collapse
Thursday, 06 February 2014 10:26
While the Congressional Budget Office’s (CBO) projections of the impact of the Affordable Care Act got the most attention after the release of its new Budget and Economic Outlook, CBO also implicitly raised its estimate of the cost of the crisis created by the collapse of the housing bubble by $1.4 trillion. This is due to the fact that it downgraded its growth projections for later in the decade, for reasons unrelated to the ACA, with the view that more of the impact of the downturn will be enduring long into the future.
The figure below shows the difference between the 2008 projections for annual GDP and the projections from both the 2013 Outlook and the 2014 Outlook. The calculations use CBO’s Long-Term Budget Projections for years beyond the budget horizon. The 2014 projections for GDP are adjusted upward for the negative impact that CBO expects the ACA to have on GDP. The 2014 figure is accordingly raised by 0.5 percent from the CBO projection, the 2015 figure is raised by 0.75 percent, and subsequent years by 1.0 percent. (In effect, these projections assume that policy changes other than the ACA have had a neutral effect on growth.)
The cumulative cost of the collapse through the 2024 budget horizon, measured as a gap between projected output in 2008 and the most recent projections, is now $24.6 trillion, as shown below. This is equal to $80,000 for every person in the United States.
http://www.cepr.net/index.php/blogs/beat-the-press/congressional-budget-office-increases-estimate-of-the-cost-of-housing-bubble-collapse - 31k -
I’m a Member of the American ‘Used-to-Haves’
Kathleen Ann
Freelance writer from New England
Posted: 02/06/2014 12:37 pm EST
I used to have a house. I used to go on vacations. I used to shop at department stores, get my hair done and even enjoy pedicures. Now, I don’t. I’m a member of the American “Used-to-Haves.”
Now, I’m renting an apartment and I’m desperately awaiting a check so I can pay the rent. Yet, I’m lucky to have an apartment that includes utilities. Despite my college degree from a prestigious college, and solid employment track record, I can’t get a job. It’s been so long since my corporate days, I now feel unemployable.
My age doesn’t help. But I’m as healthy as a thoroughbred, I appear quite young and would gladly accept a basic salary. I’m a bargain! But no. I’m freelancing for $15 an hour these days, but I used to earn $100 an hour. In fact, all the freelance hourly rates have been driven down to $15-30 an hour. To make ends meet, I also work as an aide ($13.75 an hour) and run a small local company. And my annual earnings are under $20,000.
I’m lucky to be in Massachusetts, where my health care is paid for, and fortunate to be of sound health and mind. But on days when I feel hopeless, I can envision myself 20 years from now, living in hardscrabble poverty. Female friends my age who are in similar financial circumstances are terrified of the future. If we can’t get decent paying jobs today, there’s little hope of getting a corporate job with benefits in the future. And during the past few years as we’ve struggled, we went through all of our savings, 401(k)s and anything left in the bottoms of our pocketbooks. So we can see ourselves as old, pathetic bent-over women, living in bus shelters, our ragged belongings in supermarket carts.
For the “Used-to-Haves,” every day is a struggle to hold onto hope. Everywhere we look is a reminder of what we used to have.
http://www.huffingtonpost.com/kathleen-ann/american-used-to-haves_b_4732434.html - 189k -
Watching John Boehner and the Republican Congress during the past few years has been a stunning confirmation of their seeming disregard for the “Used-to-Haves.” ..their selfishness is unrivaled as they barricade health care reform, knowingly shut down the government, cut SNAP benefits and eliminate extended unemployment payments.
It is those EVIL republicans again!
If ONLY they would get out of the way and let the democrats give us bigger and bigger government - everything would get so much better.
And so what if you live in one of the most leftist states in the union that gives you all sorts of government free cheese. More cheese would make things even better.
But yet no one will hire you even with your “college degree from a prestigious college.” Hmmmm. Ever wonder why?
You could move to where there are jobs (hint - to states mostly run by evil republicans)…but that would be asking way too much.
Better to stay unemployed, grab all the free cheese you can and keeping voting for socialists…
It may be true that freelancer rates have been cut significantly. And part of the reason is there has been a surge in freelancers, and most of the newbies lowball each other, which significantly lowballs the experienced freelancers. There are still nich areas where commercial engineering consultants can do good hourly rates. But those are niche areas for now.
In my own situation I am turning 55 in a couple months but feel like a newbie in a different career. I am thankful my boss is paying me what I earn. I put in twice the effort that I did as a consultant in my old career. And I give in to travel. At least I earn air miles for traveling on my bosses dime and he buys the food and the drinks. I am like the loyal dog just lucky to have a home. Unlike the dog I can still squirrel away more money per year into stock index funds than what I sell in individual stocks. Just biding my time for a good decision point in 2018 in the Fall when I can start retirement distributions: shift my software engineering work into Java and SQL in Phoenix and still make money but earn even less or go back I to consulting and work the left coast.
SOCHI SCENE: No FBI or CIA.
By The Associated Press
February 7, 2014 6:03 AM
A sign that says “We do not serve FBI and CIA agents,” hangs outside a restaurant on the opening day of the 2014 Winter Olympics
KRASNAYA POLYANA, Russia (AP) — Here’s an odd sign that Associated Press photographer Jae C. Hong ran across Friday in the mountains outside Sochi, where Olympic skiing and snowboarding competitions are being held.
No word on the restaurant’s policy toward the NSA.
http://news.yahoo.com/sochi-scene-no-fbi-cia-110304224.html - 248k -
The US spy agents don’t care about the restaurant. They have everything else bugged.
The Former KGB Guy, the Handgun, and the “Miracle On Ice”
If Twitter had existed in 1980, you might have found this gem on the feed of U.S. Olympic hockey player Buzz Schneider: “Is that a gun in your pants? Or are you just a KGB agent?”
It’s also why the gun-on-the-ice story has been largely unknown until now. That un-called misconduct penalty is just one of the nuggets unearthed in National Geographic Channel’s three-night event The ‘80s: The Decade That Made Us. “The ‘80s” makes a convincing case that the Miracle On Ice helped snap America out of the gloomy ‘70s and launch it headlong into the go-go, glitzy ‘80s.
Schneider discovered the gun when he checked a Soviet player into the boards during a pre-Olympics exhibition game and the opponent’s jersey slid up, revealing the firearm. Though the weapon wasn’t actually intended to intimidate the American team. As U.S. goalie Jim Craig tells it, the packing “player” was a KGB agent who was traveling with the Soviet squad to keep its players from defecting to the West.
In fact, the only reason the KGB agent was on the ice at all was because the Soviets had no fear of the callow Americans, who averaged five years younger and 13 pounds lighter than the Red Army veterans they faced in Lake Placid. Thus the Soviets had so little respect for the American team that they let the KGB agent take a few shifts. It’d be like a pro basketball team letting one of their security guards log a few minutes against their opponent – and still winning by 20.
http://gawker.com/5994445/the-former-kgb-guy-the-handgun-and-the-miracle-on-ice - 59k - Cached - Similar pages
NAACP requires marchers protesting North Carolina voter ID law TO SHOW PHOTO ID
Katie McHugh
Daily Caller
February 9, 2014
North Carolinians marching to protest voter-ID laws must present a valid photo ID to participate in an NAACP-hosted protest against voter-ID laws in Raleigh on Saturday.
The central claim among the protesters is that the voter-ID laws disenfranchise certain segments of the voting population, particularly minority voters and poor voters.
According to official NAACP flyers passed out at the rally, protesters must carry the precise kind of ID that they would be expected to present at the voting booth.
The march, dubbed the “Moral March” by its leader Rev. William Barber II, who called for a “wave of civil disobedience” while railing against education cuts and the voter ID law, is the latest of a series of protests held against the state’s GOP-controlled legislature. Over 900 “peaceful” and “non-violent” protesters have been arrested since the beginning of the state’s legislative session last January. Police have taken a handful of them into custody each week after they obstructed legislators within the capitol building.
Full article here
DHS Secretary on Illegal Aliens: ‘They’re Here, and They’re Not Going Away’
Penny Starr
CNS News
February 9, 2014
Department of Homeland Security Secretary Jeh Johnson, the nation’s top immigration law enforcer, said on Friday that the estimated 11.5 million illegal aliens in the United States are “not going away.”
“They’re here, and they’re not going away,” Johnson said at the Woodrow Wilson Center in remarks billed by the Obama administration as his “first major speech.”
Johnson’s comment came after he gave his prepared address and was in response to Jane Harman, president and CEO of the Woodrow Wilson Center, asking him about the fate of immigration reform in this session of Congress.
“In today’s press there is a new comment from House Speaker John Boehner (R-Ohio) that it may not happen this year I think,” Harman said, “which is going to be a great disappointment to many communities across our country who were hoping it will and to our efforts to rebuild our economy after the most serious recession since the Great Depression.
Full article here
The Dollar’s Replacement Is Already Here
The Greenback is Doomed
By Jason Simpkins 2013-12-27
With the Fed taper officially underway, you’ll be hearing a lot about a dollar revival over the next year.
Don’t buy into it.
At the end of the day, the dollar is still a flawed currency. It’s not backed by anything other than the word of a government that’s proven frivolous at best and incompetent at worst.
The United States has racked up so much debt, it’s practically unpayable. We’ve reached the point where, even if the government doesn’t default outright, it’s still lost credibility.
No one believes in the United States anymore.
And can you blame them?
When we’re not meddling in the Middle East, launching drone strikes, arming rebels, or toppling governments, we’re spying on our allies…
It’s only a matter of time before our currency is shunned.
The dollar is doomed, that’s a fact.
The question now is: What replaces it?
Special Drawing Rights
The Renminbi
A Universal Digital Currency
http://www.outsiderclub.com/dollar-replacement-reserve-currency-world-currency-global-currency/686 - 20k -