Bits Bucket for July 10, 2014
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
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Dallas, TX Sale Prices Sink 4% In Peak Of Selling Season; Demand Slides 6% YoY
http://www.zillow.com/local-info/TX-Dallas–Fort-Worth-Metro-home-value/r_394514/#metric=mt%3D19%26dt%3D1%26tp%3D4%26rt%3D6%26r%3D394514%26el%3D0
Rental Prices up 25% YoY. Just keep renting. Nothing to worry about…………
I overheard a realtor say, “Why buy when you can rent for half the monthly cost?”
She is right.
The 0.00001% of the time that a Realtor is right.
But otherwise, always assume that Realtors are liars.
When there is a Realtor in the room, there are lies in the air.
And still half the cost of buying at current massively inflated asking prices.
Realtors are liars.
You can say that again.
It’s the Fed crushing the economy, and the population at large.
Rents rising as household income drops. Wishful thinking.
Housing Demand Collapses In 13 Of 15 Arizona Counties
http://www.zillow.com/local-info/AZ-home-value/r_8/#metric=mt%3D30%26dt%3D1%26tp%3D5%26rt%3D4%26r%3D8%252C2402%252C281%252C685%26el%3D0
Rental prices up 10% YoY. Fewer buyers = more renters.
Collapsing housing demand.
You can say that again.
LOL.
Seems like basic economics to me. The more renters there are, the fewer rental homes available equaling higher rents.
Add in the inflationary FED policies and you have guaranteed higher rents for a long time.
Plus, capital assets in the form of a home can’t be confiscated as easily as a few digits in an electronic account.
It also helps to keep rents high if empty homes with defaulted mortgages are held off the market to limit supply.
Do you think that they’re ever going to release all of that inventory?
IMO they won’t, not until it makes economic sense for the mortgage holders which means that the downturn in prices will be controlled.
If the system were allowed to operate as a open market, then the prices would crash in many areas, but the powers that control these things aren’t going to allow it.
“Do you think that they’re ever going to release all of that inventory?”
I don’t know. I believe there are laws on the books limiting the time between when a loan goes into default and when the home goes up for sale, but I am not an expert in this area.
Perhaps Ben could weigh in on this, as I recall him making past comments on the subject.
Given the fact that I have personally seen dozens of the same vacant bank-owned homes, neither for sale nor rent, for over 5 years, I have given up on the idea that there will ever be an inventory flood. This is the most massive market manipulation in the history of housing. It’s calculated, corrupt, crooked, criminal- you name it- but it’s here and it’s not going away. When you have mark to fantasy accounting rules, and a Federal Reserve loading up on those MBS fantasies with unlimited dollars, this is what you get.
The operable word is “empty”. Full foreclosures don’t add supply to the market as they move through the system (people lose the house, and people need to move somewhere).
RealtyTrac tracks this data…”Zombie Foreclosures”. The estimate 20% of all foreclosures are zombies.
The last number of foreclosures was about 660k, so that would mean about 130k…call it 150k nationally.
These are pretty concentrated. According to RealtyTrac, 71k are in the top 10 markets.
http://www.realtytrac.com/content/news-and-opinion/zombie-foreclosures-the-vacant-dead-7999
http://www.realtytrac.com/images/reportimages/zombie_foreclosure_infographic_march_2014.jpg
Plenty in Florida…
Releasing all 150k might affect the markets with the highest concentration of zombie foreclosures, but it wouldn’t do much in most places.
Still standing by that same old lie eh R._Fraud. I guess your wallet depends on it but it doesn’t change the fact there are 25 million excess empty and defaulted houses out there with another 35 million just starting to empty as boomers die off.
G-rev, even if there is an inventory flood, the odds of a regular family scoring a foreclosure in habitable condition are low. The houses themselves need to be bought at auction, which most people don’t have the gumption for, and/or they need work, which most people don’t have the cash or time for. Banks will auction them off slowly, fix them up quickly, and bleed them to the general public at flipper prices. I have seen this in my nabe.
My “same old lies” have seemed to do a pretty good job at giving insight into what is happening in the market. You’ve been calling for a market re-crash for how long now? 2 years?
How much longer will we need to wait before you say that you were right? Another 3 years? 4 years? 5 years?
Incidentally, if that was your actual prediction (3-5 years until the next major housing correction), I would be on board with that call.
Recrash R._Fraud?
-Cratering demand 7 years running to 19 year lows
-Prices falling seeking bottom again
What’s the problem? (Other than you’re underwater.)
Plus, capital assets in the form of a home can’t be confiscated as easily as a few digits in an electronic account.
Honestly, this is a decent argument I see for buying in this environment. Have considerable savings and don’t feel comfortable investing in securities or sitting in cash that can be confiscated? Don’t want to have $100k in gold bars at home waiting to be stolen?
Thieves can’t walk off with your house, and the gov’t can tax it but not just reach in and take 10% like they can from those “selfish hoarders”.
It’s ridiculous to have to think about such things, but given everything that’s happened across the world the past eight years…
On the other hand, if the government decided tomorrow to end housing market subsidies which are deliberately targeted at stimulating housing demand, homeowners could see well over 100% of their ‘real estate investments’ (i.e. the amount of their own money they have paid in towards a home purchase) vanish overnight — similar to what happened in the post-2008 initial Housing Bubble collapse period to those who bought at the bubble peak in 2007 and remain underwater on their mortgages to this day.
homeowners could see well over 100% of their ‘real estate investments’ (i.e. the amount of their own money they have paid in towards a home purchase) vanish overnight
True, I suppose, but you get a place to live in the interim, and will continue to get the imputed rent. So its not unlike buying a dividend-paying stock for $100 and having the price go to zero (wouldn’t happen, of course), but continuing to get $5/month in dividends.
Not the best outcome, but better than having your money just go *poof* and not getting anything in return at all.
Of course one still has to pay property taxes (hopefully would go down as value of house goes down, but we’ve seen that’s not necessarily the case).
“True, I suppose, but you get a place to live in the interim, and will continue to get the imputed rent. So its not unlike buying a dividend-paying stock for $100 and having the price go to zero (wouldn’t happen, of course), but continuing to get $5/month in dividends.”
Would it be better to do this, or diversify your real estate investments by purchasing a no-hassle REIT mutual fund?
Would it be better to do this, or diversify your real estate investments by purchasing a no-hassle REIT mutual fund?
Good question. Say I would pay cash for the house (so $200k+…or $500k+ around here). Would one really want to park that much in REITs? I don’t know.
It probably would be better to go with the REIT, but you would need 20/20 hindsight to time the market correctly. And you would have to anticipate the FED’s actions. Good luck. I think I would choose the bird in the hand.
Personally, I would buy commercial property REITs rather than a home to rent out (and I have–put my money where my mouth is).
You get far more diversification with REITs, and focused management. REITs are much more conservatively leveraged today than they were previously (reducing risk when the next downturn comes), and you will never need to fix a toilet on a Saturday morning.
Selling your REIT shares costs you about a sandwich worth of commissions, and you have instant liquidity, never need to hire a Realtor, or hold an open house.
Seems like a pretty no-brain decision to me.
Thanks for the affirmations, RW. I have a Midwest middle-class McMansion’s worth of money invested in REITs which I plan to keep there as a hedge against real estate going up “more than expected” due to myriad government-sponsored price support measures.
Whac-
You can’t think of housing and commercial real estate as acting the same way, so if you are owning commercial real estate via REITs as protection against housing going up, I’m not sure you’ll get the protection you think–you might get such protection on a long-term inflation basis, but not a near-term bubble hedge.
A friend’s family has had a real estate business for going on 70 years. A significant part of their success was that they invested in and developed both commercial and residential real estate, in recognition that they operate on different cycles. Sometimes both are good, sometimes both are bad, but usually at least one has opportunity because things are going well enough.
In this cycle, housing started going up first…commercial still has a way to go.
You understand math quite well as I’ve seen over time. I suggest you study the interplay with supply/demand of real estate, cost to replace commercial real estate, yields and rents. ProLogis put out a press release and research paper on October 1, 2013 describing how they see this interplay in their business–it is worth a read (and available on their website). It is also worth reading what PLDs CEO says over the past 4-5 earnings calls–start with the early ones, and you’ll see how the market has been developing (if you’re interested in industrial RE, you would do well to listen).
Today, there are many markets (and product types) where despite low yield expectations (rental income divided by new development cost), the rents do not justify new development. And we have falling vacancy rates generally, with few exceptions, according to PREA (see their “compendium of statistics” release from earlier this week):
Industrial vacancy rates are now below the pre-recession lows (and falling quickly).
Office vacancy rates are slowly falling, but still a couple of points higher than the pre-recession lows.
Retail vacancy rates are falling, and only about a half point from pre-recession lows.
Apartment vacancy rates are now rising (!) in part I think because government intervention with the GSE loans to apartments allow new development at very low yields.
So, what happens next for product types where rents largely don’t justify new development?
Rents rise until the market begins to reach equilibrium again (where new development matches demand).
What happens as yields rise (which most view as inevitable)? Rents have to go up even more to keep development viable.
IMHO, we are entering a several-year run for strong rent growth for most commercial property (with apartments being a possible exception–there may still be rent growth, but I think it’s going to be weaker than other product types). I’m pretty concentrated in Industrial REITs–I think they are poised to do very well in the coming years.
Anyway, good luck–
Surrender to the authorities R._Fraud.
25 million excess empty houses don’t care if you’re renting or buying.
Basic physics. LOL
Basic physics? I think you must mean basic economics…..
But we all know you don’t understand basic economics….so go ahead and explain it with basic physics. HA.
Follow along J._Fraud.
More shadow inventory.
I think that’s called living in the mania.
Has Ben disclosed his new location yet? There is some money riding on Las Vegas.
+1 I say Las Vegas too.
More than plenty of speculator carcasses, and the small business environment is good in Nevada, so fix the holes in the drywall, and another coat of exterior latex, and “wah-lah” another rental rises from the ashes!
A friend of mine just came back from Las Vegas and he says they are building a lot of new housing on newly developed land….well, some of the land was developed 8-10 years ago, but just getting built today.
Interesting the home builders would build so aggressively in Las Vegas. They must be selling houses.
inhttp://www.zillow.com/local-info/NV-Las-Vegas-home-value/r_18959/#metric=mt%3D30%26dt%3D1%26tp%3D6%26rt%3D8%26r%3D18959%26el%3D0
This is the severest case of collapsing housing demand I’ve seen this week J._Fraud….. And it’s Las Vegas.
There is no hope for you.
Not sure what you are hoping: Maybe to get a link that works.
Here is what Zillow says about Las Vegas:
The median home value in Las Vegas is $174,600. Las Vegas home values have gone up 23.0% over the past year and Zillow predicts they will rise 11.7% within the next year. The median list price per square foot in Las Vegas is $106…..
http://www.zillow.com/las-vegas-nv/home-values/
Here you go J._Fraud
Las Vegas, NV Housing Demand Craters 14% YoY; Falls To New 10 Year Record Low
http://www.zillow.com/local-info/NV-Las-Vegas-home-value/r_18959/#metric=mt%3D30%26dt%3D1%26tp%3D6%26rt%3D8%26r%3D18959%26el%3D0
You might consider looking at the data before making false statements.
Having to survive off trucked-in water won’t help the Las Vegas housing market.
http://www.zerohedge.com/news/2014-07-10/las-vegas-more-screwed-drought-drains-lake-mead-lowest-hoover-dam-built
Mmm! Precious metals!
Mmm! Treasurys!
Mmm! Flight-to-quality out of risk assets…
And so it begins…2008 redux.
http://www.marketwatch.com/story/european-stocks-weaken-for-fifth-straight-day-2014-07-10
I hope so.
4 trillion of fiat and the economy is still in the tanks.
well some of that money is finally trickling down here they have been repaving the roads and boy has it got quieter.
No more 40 overfilled bumpy potholes with truck shakin, rattling and screeching their brakes….
“well some of that money is finally trickling down here they have been repaving the roads and boy has it got quieter.”
Now if only this spent money can somehow be kept circulating where it is being spent.
If the earners rush out with their newly-earned money and buy stuff that is made in China or places elsewhere then China and places elsewhere are going to be the ultimate beneficiaries of the spending.
If the earners rush out with their newly-earned money and buy stuff that is made in China or places elsewhere then China and places elsewhere are going to be the ultimate beneficiaries of the spending.
Some of that depends on how much those workers get paid. They may now have a lot left over after paying for necessities, which mostly go to other Americans.
The fiat money is just to pay the minimum balance on the credit card. It doesn’t touch the principle. We’ve been running up the principle since … well probably the mid 1970’s, the days that the first manufacturing jobs were outsourced.
These trillions of fiats needs to be moving about in order to do some good. Fiats stuck in mattresses by selfish hoarders starves the economy.
what about all the money parked as excess reserves at the FED?
Do you mean all that money that the Fed is paying interest on to the banks?
It’s doing just fine just quietly sitting where it is.
(snort)
I guess some of the fiat the treasury usually gets on interest from the bonds is being paid out to the banks to keep those excess reserves parked. There must be some sort of gentlemen’s agreement to keep that money parked because the interest is not much.
” Fiats stuck in mattresses by selfish hoarders starves the economy.”</i.
Quick everyone, buy a house with ARM rates and $1,000 down.
Otherwise you are a selfish hoarder.
If you have zero debt…you are a selfish hoarder.
“If you have zero debt…you are a selfish hoarder.”
+1 Guilty.
Bill, you really should use a tool that will check/close your tags for you
And I agree, calling folks a “selfish hoarder” for simply saving money is pretty weak. Just because everyone else is incapable of saving money doesn’t mean I shouldn’t, and that I’m evil for having the discipline to do so!
My mom’s dad ‘played the stock market’ in the 1930s with the money he ’selfishly hoarded,’ during a period when Roaring 20s investors were jumping off tall buildings over their losses. He lived in a small town and kept his investing activities to himself out of fear that his fellow citizens would take a negative view of his financial self-preservation efforts.
“And I agree, calling folks a “selfish hoarder” for simply saving money is pretty weak.”
The only reason a selfish hoarder has any money in the first place is because somebody else spent some.
Money has to circulate in order to do some good. If everyone were to decide to become selfish hoarders and stopped their generous spending habits then the economy would grind to a halt.
If everyone were to decide to become selfish hoarders and stopped their generous spending habits then the economy would grind to a halt.
Even us selfish hoarders spend money. Just not frivolously(well, I spend money on things BiLA would look down on but still save). The economy will still function, though a lot of useless businesses (pirate shops) will cease to exist and the folks working there will have to come up with more useful things to do.
“If everyone were to decide to become selfish hoarders and stopped their generous spending habits then the economy would grind to a halt.”
The suggestion that everyone will simply stop spending money on anything is a strawman which avoids the discussion of how ants save and grasshoppers blow other people’s money to buy stuff they can’t afford, then clamor for bailouts when they find themselves cold and wet on a rainy day without two nickels to rub together.
drumminj — sounds like we are on the same page regarding the macroeconomist Armageddon scenario that would supposedly play out if ‘everyone stopped spending money.’
And I agree, calling folks a “selfish hoarder” for simply saving money is pretty weak.
Does anyone actually do that?
Lying realtors on the hbb do.
Does anyone actually do that?
Read up-thread. They do, in fact.
ISTM that the people “selfish hoarders” are using money to pay off their bills. That is, they already spent it.
It’s the banks who are supposedly hoarding the money. Banks are supposed to lend instead of hoard. But by traditional standards, no one is credit-worthy enough to lend to. What’s a bank to do? Hide profits overseas? Toss the money into the bottomless hole of credit default swaps?
People who spend more than they earn drag themselves and their neighbors into poverty. That is where selfishness lies.
The most credit-worthy people do not clamor for bottomless loans. That’s why Mr. Banker doesn’t get what he needs, and it makes them selfish.
“If you have zero debt…you are a selfish hoarder.”
And a deadbeat.
Guilty as charged!
Yup!
Alas, my new name. I like hoarding tbills, metals, top wines and being debt free.
Thanks for sparking this Janet!
You are an evil person!
You bring out the best in me
https://www.youtube.com/watch?v=di60NYGu03Y&list=PLAkqjw1_WMamxOH1YjwFoXHkwaINt26YK
…but I am a flaming hetero…not an ankle pants
I’m a card-carrying Selfish Hoarder!!
” Fiats stuck in mattresses by selfish hoarders starves the economy.”
Then it’s the gubment’s fault that it prints so much money I can make another mattress out of it
Trillions of printing press fiat currency funneled to the banksters and speculators, and austerity for the 99%, may not fly anymore as the serfs are getting restless.
http://rt.com/uk/171756-strike-march-union-austerity/
“Never underestimate the stupidity of the American public, or as P.T. Barnum, or David Hannum put it: “there’s a sucker born every minute”.
The cheese will flow from the government teat, just fast enough to keep the serfs docile. Almost football season, beer and subsidized stadiums for everyone.
Looks like the flight to safety (even if illusory) has begun in earnest. “Investors” holding overpriced stawks and real estate, beware!
http://www.marketwatch.com/story/10-year-treasurys-at-6-week-high-on-portugal-banking-trouble-2014-07-10
Vulnerable “homemoaners” who bought into bubble pricing by taking on massive mortgages are about to get vulnered.
http://www.telegraph.co.uk/finance/personalfinance/houseprices/10957976/Mortgage-deals-leave-thousands-vulnerable-if-house-prices-fall.html
They’ll get what they deserve for listening to a Realtor.
Where the foreclosures are: 10 top states
1) Florida
Indiana
2) Maryland
3) Nevada
4) Illinois
5) Ohio
6) New Jersey
7) Delaware
9) Connecticut
10) South Carolina
What? Where’s Arizona in all of this?
http://realestate.msn.com/where-the-foreclosures-are-10-top-states
However excess empty inventory is highest in CA, AZ, FL and NY.
There is little to no excess inventory in CA. That is why they are building so many houses now.
4.4 million excess empty houses concentrated in California and demand at 19 year lows. That’s why new construction is nonexistent.
Not to suggest there aren’t a lot of empty houses around CA, but they have recently fired up the bulldozers again in San Diego County. I guess these new homes priced ‘From the $1 millions’ will help feed the never-ending waves of all-cash investor demand sweeping across the Pacific Ocean from China.
More misallocation=much larger collapse.
This is a VERY good article on the status of HELOCs, with some focus on California. The article is six months old, but it paints a frightening picture of what is going to happen to HELOCs, especially in CA. The whole thing is worth reading, but here is the gist:
http://advisorperspectives.com/dshort/guest/Keith-Jurow-131216-HELOC-Resets.php
A HELOC works like this: Your house is collateral. You get a credit limit. (In some cases, the limit rose with appreciation). You get a “draw period” of 5-10 years to borrow cash and pay interest only. After the draw period, you stop borrowing, and now you have to pay it back fully amortizing in 10-20 years.
*2005-2007, roughly 10.8 million HELOCs were originated.
*At peak in late 2009, $672 billion was borrowed as a HELOC. That’s a lotta paint at Lowe’s.
*Some HELOC’s were purchase piggybacks, but most were cash-out refi’s.
*Between 2004 and 2006, roughly six million HELOCs were re-financed. That is, they re-fied a second or thrid time to pry still more cash out of the house.
Got that, folks? 10.8 million homes took out HELOCs. 6 million out of those were serial HELOCs. They pay I/O with a TEN year grace period. Then they have to pay back the equivalent of a new mortage, fully amortized, at a higher interest rate, over half the time as a regular mortgage. A HELOC payment could jump from $300 to $2000 overnight…
Those 10-year HELOC’s have just begun to reset. The article has a nice graph, reminicient of the old Credit Suisse graph, showing HELOCs. Add 10 years to the dates and you’ll see the disaster in the making. These folks are toast. Effing TOAST. And it’s going to happen very soon.
I don’t know how this will affect Jingle Male’s investments in Sacramento. A second wave of defaults would make house prices fall, but how far? Enough to wipe out the gains since 2009? Even then it might not hurt JM. If anything, JM could break even on house value, but now with increased demand for rentals.
You’re still skimming over reality…
Housing demand is at 19 year lows. And that’s going to continue until prices fall to long term trend or roughly 65%-85% lower, regardless of helocs or whatever counterfeit you want to use.
A few points here:
1. Note the title on the CA graph: “Purchase Loan Originations”. In other words, these were the “Piggie Back” loans that were part of the madness of the housing bubble (allowing people to buy with a first and second going to 100% LTV).
2. These high leverage purchases were the source of lots of underwater loans, and thus the reason for a lot of defaults already.
3. The article was written in December predicting that the beginning of 2014 will be the start of multiple years of pain from the HELOC resets.
There are three main possibilities:
1. Lots of the HELOC’d properties have already defaulted and been foreclosed;
2. Going forward only the underwater homes with HELOCs will significantly contribute to additional defaults (otherwise people can sell to get out from under the problem);
3. There is substantial pain that arises from the HELOCs as the author predicts, starting with 2004 HELOC resets that will begin in 2014.
We now have the first 5 months of data from 2014 available on PropertyRadar for CA. So far, NODs and Notices of Sale have trended downward each month from January.
We also have the first 5 months of non-current loan data from LPS. Same story–non-current loan rates have fallen each month so far in CA.
We also have the first 5 months of data from CoreLogic’s Foreclosure Report. Same story–foreclosure inventory has been flat or down each month (they round to one decimal), and the Serious Delinquency Rate has been down each month.
Of course, it might take time for the pain to really hit the numbers, so I will not say that the first 5 months would make me conclude that the HELOC pain will NOT come. But the longer these trends are unbroken, the harder it is to buy into the author’s theory.
That’s the way this works…have a theory, test with data. His theory is sound–HELOC pain is a reasonable possibility…so far, the data isn’t helping to prove the theory.
We got a HELOC back in ‘07 for an addition but paid it off and closed the account in ‘10. Never again.
I think we’re going to need a lot more time before this plays out. I don’t know the HELOC laws, but I imagine that it’s much more difficult to foreclose on a house where someone is still paying the mortgage.
I imagine a lot of the earlier HELOCs were rolled into fixed rate refinancing.
What’s with the sunny smile for Indiana?
Indiana wants me. Oh I can’t go back there.
I think it’s a thing.
Type in an 8 and a ) and you get
Yes, it’s the wordpress code for the “cool” smiley. The “8″ is sideways for sunglasses and the “)” is the sideways smiley mouth.
The murder rate in Indianapolis is apparently skyrocketing, which is too bad, as by appearances it is an attractive mid-sized Midwestern city.
It sounds like Indy is a bit too handgun happy for its own good.
Indy reels after another tragic loss
Jul. 8, 2014
Indianapolis is reeling again after yet another brutal weekend of pointless violence. Seven people were shot early Saturday in a senseless dispute on the streets of Broad Ripple. Two women were shot late Friday on the Eastside, where police found 30 bullet casings on the ground near the victims.
And in the most heartbreaking blow of all, officer Perry Renn, a 21-year veteran of Indy’s police force, was shot to death while responding to a call Saturday night on the Eastside.
Renn is the second Indianapolis Metropolitan Police Department officer fatally shot in the line of duty in the past 10 months. Eight other officers have been wounded by gunfire, according to Public Safety Director Troy Riggs, and 22 have been fired upon in the past 18 months.
A bit more perspective: Indianapolis’ homicide rate in 2013 was significantly higher than the murder rates in Chicago, Los Angeles and New York City.
To underscore the obvious, our city has a deep, ongoing problem with violence, especially gun violence, and nothing short of an all-out community push will change that.
…
I heard Fort Wayne is one of the safest places to live
Maybe the uptrending violence will eventually spur Indiana’s legislature to tighten up its gun purchase laws. This would also help Chicago curb its homicide rate.
Maybe pigs will fly.
You must be retarded. Why is it so-called “gun violence” is always the worst in places like Chicago where gun laws are most restrictive? Because thugs don’t ABIDE by laws, perhaps?
Was that directed at me, “Ray”? You are an ignoramus who obviously knows nothing about the sources of the guns used by Chicago gangs.
I might think about Indiana if I wanted to live on a small farm, raising cattle, chickens and huge garden. Compared to Illinois where I grew up, it’s a libertarian paradise.
I’m currently working on my Square Foot Garden
http://www.squarefootgardening.com/
I’m currently working on my Square Foot Garden
I did some of that two rental houses ago. Sadly, my current rental doesn’t have a yard/the right exposure for a garden. I definitely miss it - such a relaxing activity.
While the .01% were engorging themselves on the Fed’s free gambling money, the economic malaise worsened for the 99%.
http://www.businessinsider.com/family-dollar-sales-fall-2014-7
I wonder how many shares that bought back to goose those earnings / share numbers?
Around here the .99 cent stores are taking walmart to task. They are selling a lot more groceries.
What’s neat about the .99 store (from the owners point of view) is they don’t have to carry lots of groceries such as the grocery stores do, they can pick-and-choose. They can pick and choose to offer what is most profitable to them and ignore the other stuff.
The shoppers, the smart ones, will go to the .99 store and stock up on what is offered there and then they will move on over to the grocery store and buy up the rest of the stuff they need.
This means the .99 stores get to enjoy selling things that have the greatest mark ups and the grocery stores only get to sell the other stuff.
Maybe the 99% have moved up from 99 Cent store junk to Walmart junk.
Walmart: Consolidated net sales reached $473.1 billion for the year, an increase of $7.5 billion, or 1.6 percent.
I guess they must of opened some new stores.
2013 eps 5.04
2014 eps 4.90
Thats after buying back 600,000,000 shares from 2010
If you factor in the shares available in 2010 and compare with net income of 15.88 billion that = 15.88 (2014 net income)/3.87 shares(2010) = eps of 4.10 for 2104
That looks like a sinking ship to me
Smarmy Johnny._Fraud.
“Also disappointing was Wal-Mart’s fourth quarter same store sales in the U.S., which fell 0.4%, about as much as analysts were expecting. Bill Simon, Walmart U.S. president and CEO, said that the decline is extending into the company’s first quarter results, and same store sales were down for the first two weeks of February thanks to “continued severe winter storms.”
walmart 2014
total assets =204.75 billion
total liabilities = 121.92 billion
Shareholder equity = 204.75-121.92 = 82.83 billion
82.83 billion / 3.27 billion shares = $25.33/ share value
why are people paying 77.00/ share?
From 2010 -2014 walmart spent 42.64 billion dollars on stock buybacks.
From 2010 -2014 Total liabilities went from 102.88 billion to 121.92 billion
An increase of ~ 20 billion in debt over 4 years
Common shareholder equity went up ~ 5.47 billion in that same period
Net operating cash flow
2010= 26.25 billion
2014= 23.26 billion
Around here in central Florida you cannot get to a Walmart without passing a few dollar stores. Every road leading towards a Walmart is loaded with them. Those driving drunk, on drugs, or who have lost their driver license are probably the majority here.
One of the Wall Street plutocrats who counted on endless free gambling money from the Fed to drive asset bubbles, er, markets, to endless new highs - and just bought more at the top - may soon have some pissed-off “investors” to deal with.
http://www.zerohedge.com/news/2014-07-10/amazing-gartman-does-it-again-we-are-going-back-being-%E2%80%9Cpleasantly%E2%80%9D-long
that douchbag changes his mind every week. He is a disgrace to cnbc who has him on as a cheerleader every week.
CNBC in its entirety is a disgrace. Nothing more than a 24/7 infomercial to lure the unwary into Wall Street’s rigged casino.
I guess the sheep are waking up cause their ratings are just awful.
Between corporate buybacks and the FED I guess you dont need any other buyers. Have you seen the volumes on the exchanges?
HFTs amount for more than 70% of what anemic volume there is. I’d love to see a Tobin tax passed. You’d hear the bankster squeals on the moon.
Oil declining despite Mideast turmoil - could it be that unemployed people don’t do much driving in our “economic recovery”?
http://www.marketwatch.com/story/oil-on-track-for-10th-straight-daily-decline-2014-07-10?link=MW_home_latest_news
Partially.
The article says: “increased supply from Libya, decreased demand from China and financial turmoil in Portugal,” and “a smaller-than-expected drop in U.S. crude supplies.”
That last part is Americans driving less I guess.
I found that odd as well. With escalating violence in Iraq and prices are dropping?!?! Whatz wit dat? Miles driven per year in U.S. is on a downward track.
Gun Confiscation Begins in New York?
Nassau County man: State Police “just came to my home and took everything”
by Paul Joseph Watson | July 10, 2014
Second amendment activists are expressing concern that authorities in New York state have begun moving towards mass gun confiscation after a man had all his firearms seized by police over a 15-year-old misdemeanor charge.
In a post on the nyfirearms.com forum entitled, “NY State Police Just Came to My Home and Took Everything,” a Nassau County man describes how he received a visit from State Police who wanted to inspect the serial number of a semi-automatic rifle he had just purchased.
“I brought him to my safe, opened it and the 2nd officer went in and took out my cx4, Remington 70 sps and Remington 870 shotgun. Then he says that I had a misdemeanor possession charge 15 years ago and all the guns will be taken,” the man wrote, adding that he was put through the FBI’s National Instant Criminal Background Check System when he purchased the guns with no issues.
The post elicited a huge response from other forum members who encouraged the man to get a lawyer while advising them that he shouldn’t have allowed cops to enter his home without a warrant. Others said the case highlighted how “registration leads to confiscation.”
The man now faces having to get permission from a judge in order to have his firearms returned.
“The mods reached out to him, and he proved his case by showing them the paperwork from the state troopers,” writes Dan Zimmerman.
After the passage of the the NY Safe Act back in April, which was described by Governor Andrew Cuomo as the “toughest” gun control law in the United States, less than 10 per cent of residents obeyed by registering their assault-style weapons.
Some Sheriffs publicly stated that they would not order their deputies to enforce the law, while Assembly Minority Leader Brian Kolb derided the Safe Act as “the worst piece of legislation I have seen in my 14 years as a member of the Assembly.”
Protesters against the measure marked the deadline by shredding their registration cards during a demonstration in upstate New York, arguing that the law merely creates a new class of criminals out of responsible gun owners.
The backlash against the NY Safe Act mirrors what happened in Connecticut, where residents were required by law to register high capacity magazines and assault rifles manufactured after 1994, yet just 13% of gun owners complied.
I wonder if by “had a misdemeanor charge” - he had not served time and had an outstanding warrant, was charged but then cleared, or that he was charged and served time? In the second and third cases the cops had no right to enter his property. Violation of the 4th amendment.
He should have stood them down with his firearms from his porch.
He should have stood them down with his firearms from his porch
Yeah, that’s a good way to get shot and killed.
I’m definitely curious to see more details on this story. I’m generally skeptical of these types of stories that come out of these forums, but this also wouldn’t surprise me.
Another chest-thumping keyboard commando….
So will Ray “Chocolate City” Nagin hang himself or quietly join his homies for a dime stretch at ‘da big house.
I’ll take dime stretch for $800, Alex!
S&P highest was 1985 a few days ago. Could that be the peak from which a 30% drop will occur? A one year descent? Two year descent?
I have CVX and PG on my shopping list.
You should add CYNK to your shopping list, and put it at the top.
Get me a sandwich, woman.
Ha ha! It took a few hours for me to look at the screen name and I thought it was HA!
Oxy - really funny comment!
China’s Booming Real Estate Market Finally Begins to Slide - NPR
Link
I’m wondering whether a collapse in China residential real estate would hasten or slow the flood of all-cash Chinese investors who have recently snapped up residential properties in coastal CA at 25% premiums to list price.
My hunch: The initial effect will be to increase the flood (”rats jumping off a sinking ship” phenomena), but this will eventually give way to a dearth of new Chinese equity locusts (historical parallel: collapse of CA investment demand for properties in OR, WA, ID, UT, NV, AZ, MT, etc after 2008).
Comments?
My hunch: The initial effect will be to increase the flood”
Yes I think so.
(historical parallel: collapse of CA investment demand for properties in OR, WA, ID, UT, NV, AZ, MT, etc after 2008).”
End of easy money when fear over comes greed. Probably a few years out yet …
Obama defends not visiting Texas border, saying he’s ‘not interested in photo ops’
By Katie Zezima and David Nakamura July 9 at 8:56 PM
“Nothing has taken place down there that I’m not intimately aware of,”
http://www.washingtonpost.com/…/07/09/b7c5d77e-079e-11e4-a0dd-f2b22a257353_story.html -
———————————————————————————-
Feds Posted Bid Request To Handle Child Immigrant Surge Back In JANUARY
6/24/14
Immigration and Customs Enforcement, a branch of the Department of Homeland Security, posted a bid request for “Escort Services for Unaccompanied Alien Children” on Jan. 29 at the site, FedBizOpps.gov, looking for contractors to help transport and care for the UACs.
“The Contractor shall provide unarmed escort staff, including management, supervision, manpower, training, certifications, licenses, drug testing, equipment, and supplies necessary to provide on-demand escort services for non-criminal/non-delinquent unaccompanied alien children ages infant to 17 years of age, seven [7] days a week, 365 days a year,” reads the bid request.
A majority of the UACs are between 12 and 17 years old. Most of them hail from Honduras, El Salvador, and Guatemala.
“Transport will be required for either category of UAC or individual juveniles, to include both male and female juveniles,” reads the bid request. “There will be approximately 65,000 UAC in total: 25% local ground transport, 25% via ICE charter and 50% via commercial air.”
Read more: http://dailycaller.com/2014/06/24/feds-posted-bid-request-to-handle-child-immigrant-surge-back-in-january/#ixzz374m4Gk6v
———————————————————————————
Obama Urgently Asks $3.7 Billion for Border Crisis
WASHINGTON — Jul 8, 2014, 6:05 PM ET
By ERICA WERNER and JIM KUHNHENN Associated Press
abcnews.go.com/…/wireStory/ap-sources-obama-backs-off-border-policy-24459521 -
Obama might be right to not go to these detention centers. No matter what he does he’ll look bad. And what if jose canusi is right about these kids having untreatable strains of diseases like TB? I know it sounds hokey, but there is a real possibility of infecting the President, and the Secret Service can’t mess around. Nor can they dress Obama in a haz-mat of any kind. It would make the kids look like a plague and make Obama look silly, like Dukakis in the tank.
Obama’s time is much better spent with Perry.
He could fire up the kiddies with his “stay hopey” speech.
http://www.zerohedge.com/news/2014-07-10/barack-obama-dont-get-cynical-get-hopey
It’s a great day to own Treasury bonds. Hopefully you did not dump all of yours on fears of rising interest rates due to the QE3 taper.
Given the flight-to-quality into Treasurys, it is hard to find evidence to support ABQDan’s claim that the dollar is about to soon lose its reserve currency status.
In case this didn’t dawn on some of you yet, a long-term Treasury bond is nothing more nor less than a promised fixed dollar annuity with lump-sum return of principle at the end of the term.
July 10, 2014, 8:04 a.m. EDT
10-year Treasurys at 6-week high on Portugal banking trouble
By Ben Eisen, MarketWatch
NEW YORK (MarketWatch) — Treasury prices jumped Thursday, sending the benchmark yield to a six-week low as investors bought into the safety of U.S. government debt amid fears about Portugal’s banking system and weak Chinese data.
The 10-year note (10_YEAR -1.84%) yield, which moves inversely to price, was down 3.5 basis points on the day at 2.512%, its lowest yield since May 30. The yield was on track for its fourth consecutive day of gains.
Buying of U.S. government debt was spurred in large part by concerns over Portuguese banks as Espírito Santo International SA delayed repayment of some of its short-term debt this week. Espírito Santo Financial Group SA (PT:ESF -8.92%) and Banco Espirito Santo (PT:BES -17.24%), both under the umbrella of ESI, had trading of their shares suspended.
While the situation has been ongoing this week, it raises “broader concerns about how peripherals have performed and ongoing stress in European’s banking system,” said David Ader, head of government bond strategy at CRT Capital Group LLC, in a note.
Portuguese 10-year bond yields surged for a second day, rising 10.5 basis points to 3.907%, according to Tradeweb. European stocks tumbled to a two-month low.
The demand for Treasurys was also aided by weak Chinese export data.
The U.S. 5-year Treasury note (5_YEAR -2.51%) yield fell 4.5 basis points to 1.627% while the 30-year bond (30_YEAR -1.13%) yield dropped 1.5 basis points to 3.343%.
…
Sold stocks and bought treasuries a few months ago.
A re-balance
So the FOMC is planning on totally eliminating the buy back of toxic MBS this Fall. I call that a sign the rates have bottomed. And nowhere to go but up. Not really a great time to own treasury bonds.
We could be settling in a very long gradual increase in rates. It’s going to be bad for bond holders. They will want shorter maturities. While the ones currently in short maturities are going to look at even shorter maturities.
Sell off of bonds and maybe a soft landing. At best it could be great for stocks and meh for gold. But if not a soft landing, bad for bonds, bad for stocks, and great for precious metals of all colors.
Stay debt free. Accumulate T-bills, silver, quarter ounce gold, quarter ounce platinum, and cash - HOARD cash.
Sez the hoarder
It is an even better day to own metals and t bills
You are selfishly starving a Realtor of his livelihood.
Keep up the good work.
What are the chances U.S. stock market naysayers will eventually prove correct on their stopped-clock prediction for a 10% correction?
“There’s a disconnect…”
This is nothing new. It’s lasted for years, in fact.
July 10, 2014, 6:16 a.m. EDT
7 signs a 10%-plus drop may be coming for stocks
Analysis: There’s a disconnect between the economy and the equity market
By Jeff Reeves, MarketWatch
Stocks started the week with a whimper, with a sharp two-day slide as second-quarter earnings started to trickle out.
That’s not an encouraging sign for investors.
You see, after excuses about the bad weather in the first quarter and enthusiasm in the media about a continued bull market that seems destined for another double-digit percentage gain this year, many investors are unnerved.
They know that markets can’t go up forever. They’re waiting for the other shoe to drop. And underperformance in stock prices and corporate earnings could be the confirmation that the market is about to fall for an extended period.
…
inflation 101 - an expansion of the currency supply resulting in higher prices due to the loss of value in the currency.
It doesn’t work that way $hitHousePoet/Amy.
Strike 2.
your back to bs again today?
Still operating in the dark Poet?
no wonder you broke
Stock prices are already recovering nicely from their early-day swoon, suggesting that 10% correction fears are overblown.
Rent stabilization in NYC under pressure landlords try to buy out tenants in rent controlled apts for 6-figure prices.
http://www.nytimes.com/2014/07/10/nyregion/as-new-york-landlords-push-for-buyouts-tenants-stand-their-ground.html?hp&action=click&pgtype=Homepage&version=HpSumSmallMediaHigh&module=second-column-region®ion=top-news&WT.nav=top-news
——————- (excerpt)
“The first offer from the landlord’s representative came in April: Take $90,000 to move out, the tenants said they were told, or the landlord would sue and they would lose their apartments anyway.
Lin Thai Ng, who lives in a cramped $500-a-month studio in downtown Manhattan with her husband, said no. The landlord persisted and offered $100,000.
After they refused again, the couple got a notice saying they were not the lawful tenants and declaring them squatters. They were told they had 18 days to get out or they would be evicted.
“He wants us to move,” Ms. Ng, 57, an immigrant from Malaysia, said in Cantonese through an interpreter, “but where are we going to move?”
Offered $100,000.00 to move and turned it down. So glad today’s immigrants are the “best and the brightest”.
Let’s recap:
No speaky Engrish
Turns down $100,000 grand to hang on to a cramped $500 a month studio in the bowels of Manhattan
Lives in a huge country with plenty of places to live and work and has no idea where they could move.
Now that’s what I call a real immigrant success story. Is this a great country, or what???????????
If they’re dead-set on NYC and they are legit tenants (they had a lease with former owner and were not subletting), staying makes some sense. They rent on an equivalent type of place might be 2500 or so. So the real question is whether they are actually tenants with a lease. If so, that place is a bargain and I can see wanting to stay. Moving within NYC would eat up the 100k within a few yrs.
Overall, I’m with you, I’d try to get the LL to up his offer to $110k (or whatever) and take a long look at places where that kind of payout + a part time unskilled job would make for an easy life.
The really funny thing about NYC is that you’ll see people who make good income and they’ll stay in a rent-controlled apt in an awesome location forever. This drives LLs nuts because they lose thousands a month on every unit in a building.
They rent on an equivalent type of place might be 2500 or so
Which, if it’s really only $500/mo they’re paying, it’d take 50 years to save the $100k the LL is offering.
They’re saving 2k per MONTH compared to fair market value (it might be even more–there are plenty of small, basic Manhattan apts that go for multiples of 2k).
Even if they’re “only” saving 2k/month, they’ll make the 100k back in 4 years.
What you really have to account for is the location they’re living in. It’s in Manhattan, which means it’s pretty safe, probably very close to numerous subways, and it’s presumably very convenient to his place of work.
Lastly, you pay your rent in post-tax dollars. Meaning, to make the extra 2k to pay for an equivalent place, you’d need to earn like 3k or 4k/month more (depends on tax bracket, obviously).
Thanks for filling in the math, Joe.
Come on, drumminj. You are better than that.
If you assume they have to earn $3000 to have the extra $2000 a month, they are better off staying even if they only stay for 2 years and 10 months.
Come on, drumminj. You are better than that.
Pardon me for accidentally thinking “per year” rather than “per month”. Simple/easy mistake.
So 50 months rather than 50 years.
“The really funny thing about NYC is that you’ll see people who make good income and they’ll stay in a rent-controlled apt in an awesome location forever.”
They won’t just stay, but will spend the equivalent of a large condo downpayment in order to stay. I know several long-time Manhattanites who routinely spend $50k-$100k cash on legal fees in disputes with their landlords, all to preserve their rent controlled status or force the landlord to upgrade something. Because while the rest of us pay market rates for tiny walk-ups in tenements, these baby boomers have a basic human right to occupy a 3000 sq ft loft with private elevator in Soho for $500 per month (true story).
Whether one is for or against rent control, there should absolutely be maximum income and net worth ceilings. If you have $100k cash to spend on lawyers, in no way do you need or deserve artificially suppressed rent.
Liberace!
Evicted in NYC is a relative term it might take 6 months….but then judges will probably side with the LL if he offered that much to move….Had he offered $10,000 the tenant would stay.
But still greedy owners never understand the economics of this you bought a building at FAR LESS then market value….with rent controlled tenants who have a lease for life….so offer them $100k and you can combine apartments and maybe rent them out for $4000 a month effectively increasing the buildings value $250K or more….there is no need to get nasty….but you see what happens when you do.
It makes a lot of sense for the LL’s to get people out, even at 100k in some cases. It’s not always a slam dunk for tenants, though. Say you’re in your 50s and a few yrs away from retiring for good. The prospect of having fixed rent in a good location combined with being able to make NYC income for another few years is hard to ignore.
The guy who turned down 100k to move is a bus driver; even bus drivers make like 60 or 70k in NYC, probably more if he does OT or works holidays/weekends. What’s he supposed to do, take his 100k buy out, give up his NYC job, and move to Alabama to work a McJob for $12/hr? Meanwhile, the rent on some hovel in AL is probably more than his manhattan rent-controlled apt (he pays $500/month, haha).
joe the trick is to want to leave NYC and get the most $$$ without the landlord being suspicious . If he knew you had plans to move You’d be lucky to get $10,000 so you have to put up some decent fight….like poker.
Stock markets in Europe and the US have fallen over concerns about the health of one of Portugal’s biggest banks.
Shares in Banco Espirito Santo were suspended after falling 17% following concerns about accounting irregularities at its parent group.
As a result, the Lisbon stock exchange fell more than 4%, Madrid’s IBEX was down 2.7%, while the Paris Cac 40 and Frankfurt’s Dax were both 1.8% lower.
Wall Street also opened sharply lower, with the Dow Jones falling 150 points.
This took the index well below 17,000, the level breached for the first time earlier this month.
http://www.bbc.co.uk/news/business-28249080
A dodgy bank, well that’s novel.
So, I posed a questing a while back, but haven’t gotten an answer from anyone.
Background:
1. Unless you had a hardship, you really can’t borrow from the GSEs within 7 years of a foreclosure or within 3 years of a short sale.
2. Foreclosures really ramped up at the end of 2007/early 2008, and short sales really ramped up in 2012 (meaning 7 years and 3 years start to burn of with significance quite soon).
3. I’ve seen a few surveys of people who were foreclosed, and a high percentage say they want to buy again (one such survey noted 80%).
4. The number of foreclosures per month was very high…in CA alone, it was like 20k per month–240k per year, for several years. For context, CA might have a total of 400k-500k sales per year.
What will be the effect of the passage of time on the ability for foreclosed parties to get back into the homebuying market for 2015-2017?
There are a number of possibilities:
1. Minimal effect: Lots of the people will resources who walked away have already repurchased using non-GSE finance, or bought before they walked away.
2. Minimal effect: The people who walked away did so because they weren’t stupid, and they’ll wait for the next correction to buy again.
3. Significant effect: If only 25% of those who can buy again decide to buy again, it increases demand by 60k per year in CA…which is approximately all of current pace of new single family development (could double demand for new housing).
Any opinions out there?
An interesting side note, PREA puts out a “Compendium of Statistics” with the most recent version released 2 days ago. While office, retail and warehouse continue to have demand outstrip supply (ie. less property built than leases signed, which leads to lower vacancy rates), apartments are the opposite. For the last 2 quarters, new development has exceeded new demand, thus increasing vacancy rates. Additionally, demand is on a DOWNWARD slope, and supply is on an upward slope. It is a curious development in a market with purportedly strong job growth and weak for-sale housing demand…I can’t explain it.
questing=question…sheesh…
Depends.
In areas where it’s cheap to build, I expect people will prefer newly built or recently-built stuff. This is most of the country other than NYC area, Bay Area, parts of SoCal, and maybe DC. But for the rest of the US, I don’t think the used home market is going to see a dramatic increase in demand.
You also have to look at demographics, energy costs, and the labor market. Young people have less demand to buy houses (esp large ones) than older people have to sell them. (Exceptions are pretty much the same areas I listed above re high housing costs.) It costs more to live in the ‘burbs and esp. the exurbs than it did in 2004 & 2005. The spread will continue because taxpayers and governments are getting hip to the construction and maintenance costs of far-flung road systems, sewers, schools, and other infrastructure. Younger people also are not into car culture/clown car commuting. This might be a result of the labor market, but regardless the labor market also plays a role. We’re going to see an increasing spread between the abundance and quality of jobs in certain sectors of the economy and in various regions of the country.
I think these effects swamp the 7 yr window on getting GSE backed mortgages. I think a lot of the foreclosed people have persistent job issues, unstable or untraditional families (lots of divorce and single moms, among other things), and are unlikely to rush out and buy 4 walls in Henderson NV or Roseville CA just because they would save $200/month compared to rent. Yes, they may have mailed back the keys in 2007 despite technically being able to make the payments, but don’t confuse that with them actually really having the ability to “afford” a house.
We simply had too high a rate of home ownership relative to the state of the economy. And with the ‘boomer die off beginning in earnest in the next few years, that isn’t going to change.
Define “cheap to build” Liberace.
I think the effect will be minimal because the people who bought in 2006-7 used no-down toxic credit. Now that they need 3.5% down in cash and must pay full PITI, they still can’t afford to buy, even at 50% haircut prices.
Neither could you but it didn’t stop you.
Any opinions out there?”
I bought a short sale 2 years ago the “owners” told me they wanted to buy again and were told by an expert that home prices would stay flat or decline for a few more years ..
I suppose they could buy again its been over 2 years but unfortunately prices have gone way up.
They bought at the peak for 600K it went below 400K a couple years ago and now is estimated at 550K so its almost back to peak bubble.
While these numbers might seem quite high to many they are low end for this area many newer bigger homes are well above 1M. And they wanted a bigger home like they had back East were they moved from.
so they’ll be getting it at a discount at $550k. lather, rinse, repeat
Did the thought occur to you that there isn’t a house on the planet that costs more than $200k to build?
A lot of well reasoned skeptics…I like it.
My thinking is actually pretty simple.
Lots of people have been bemoaning the housing market, and saying that homeownership is down permanently, the “new normal” is renting, etc.
However, after the massive number of foreclosures, there were a large number of people who simply are unable to purchase, regardless of capabilities.
So, the important question: Given that it seems a lot of these folks say they want to buy again, of the millions people who were foreclosed on over the past 7 years, what percentage are willing and able to buy again once they are technically able (ie. the foreclosure has come off their record? 5%? 10%? 15%? 20%?
What’s your guess?
Now, overlay the actual timing.
There were about 400k foreclosure sales in 2007.
There were about 800k to 1MM per year in 2008-2011
On the margin, this adds buyers to the market…the question quite simply is how many? And does that amount of additional buyers make any difference what-so-ever?
Nobody wants to buy because they know prices are grossly inflated.
Is it always that difficult with you R._Fruad?
Here’s a stock that’ll make you rich (or make somebody rich):
Its symbol is CYNK and its price is going to the moon!
(A minor detail: The company may not even exist.)
Go here, and then go all in (if you dare):
http://business.financialpost.com/2014/07/10/a-social-networking-stock-has-exploded-25000-in-a-few-days-and-its-not-even-clear-if-the-company-exists/?__lsa=1d94-8092
“(or make somebody rich)”
More about this (from the article):
“Beyond the company’s financials, just who is involved with the company gets even stranger: there is only one employee.”
“In its March filing with the SEC that said the company would not be able to file its annual report, Marlon Luis Sanchez is listed as the company’s president, CEO, CFO, chief accounting officer, secretary, treasurer, and director.”
Lol, looks to be quite a busy man.
“In a filing with the SEC, however, the company says it ‘does not have an employment contract with its key employee, the sole shareholder who is the Chief Executive and Chief Technical Officer.’
“According to data from Bloomberg, Sanchez owns 210 million shares of the company.
“As of November 7, 2013, there were 291.45 million shares of the company outstanding, according to an SEC filing.
“Just today, the stock was up more than $8, or nearly 150%, and people began to take notice.”
And no doubt, because in a lot of people’s minds Price equals Value and a rise in price translates to a rise in value, this Sanchez guy is going to have a nifty market to unload into.
I did some digging and came across this (from Seeking Alpha):
“CYNK Technology (OTCPK:CYNK) shares soared 3650% on Tuesday after paid promotion companies simultaneously touted the company’s prospects in what appears to be a coordinated effort. With 291.5 million shares outstanding, this gives CYNK a market capitalization of $655 million. Tuesday’s rise in the share price would make an investor think that the company discovered that their headquarters is located on a gold mine or that they’d discovered the cure for cancer. At a minimum, one would expect that the company would do something or possess some assets. However, this is not the case for CYNK which has assets of $39 (no zeros omitted), no revenue (has not had any revenue since at least 2008), and $1.5 million in accumulated losses. According to CYNK’s filings, the company is a development stage enterprise which is looking to create a social media business, though it has not yet created one and does not even have a website.”
Assets of $39? No revenue? $1.5 million in accumulated losses?
Well, on the plus side:
“… shares soared 3650% on Tuesday after paid promotion companies simultaneously touted the company’s prospects in what appears to be a coordinated effort.”
Put some lipstick on a pig, jack up the price of the pig a bit, and then stand back and collect your winnings.
Here’s another Seeking Alpha article that explains a lot about what is going on with CYNK.
CYNK represents the new scheme in town. Look for more schemes to come.
http://seekingalpha.com/article/2309115-cynk-technology-is-the-new-scheme-in-town
People are smart.
Here’s a 1 3/4 minute video that talks about this stock:
http://video.cnbc.com/gallery/?video=3000291500&__source=yahoo%7cheadline%7cquote%7cvideo%7c&par=yahoo#eyJ2aWQiOiIzMDAwMjkwNDg2IiwiZW5jVmlkIjoibXp6OENwZWl3RzA0VW1SOHBHbFh5UT09IiwidlRhYiI6InRyYW5zY3JpcHQiLCJ2UGFnZSI6IiIsImdOYXYiOlsiwqBMYXRlc3QgVmlkZW8iXSwiZ1NlY3QiOiJBTEwiLCJnUGFnZSI6IjEiLCJzeW0iOiIiLCJzZWFyY2giOiIifQ==
Is now a good time to bring up the artist who canned his own sh1t and successfully sold it as art.
looks like the ppt saved the market again today.
Maybe that evil selfish hoarder poster will sell some of his hoard and buy some of this stock. It would serve him right if he did.
I sell individual stocks these days. To put more $100s under my mattress
has the economy recovered enough to flush investors out of their positions again?
Me I don’t care about the other traders. I made over 500% and have more to sell. Even if the last five year average nnul gin of the broad market was just 7% I would still think it is time to sell a cyclical if the industry is showing it is peaked.
want to get ripped off? go talk to a realtor
want to go broke, listen to your rubbish. Got equity?
this paid message sponsored by the national association of realtors
July 10, 2014, 4:30 p.m. EDT
Fed’s Fischer does not support breaking up biggest banks
By Greg Robb
WASHINGTON (MarketWatch) — It is not clear that breaking up the largest banks would end the need for government bailouts of the financial sector, said Stanley Fischer, the new vice-chairman of the Federal Reserve, on Thursday. “In short, actively breaking up the largest banks would be a very complex task, with uncertain payoff,” Fischer said in his first speech since joining the central bank in May. Fischer will find some opposition to this view on the Fed as Richard Fisher, the president of the Dallas Fed, is a strong proponent of breaking up banks to end too-big-to-fail.
I really think we need to print some more cash so stock and home prices keep going up and make us feel wealthier.
Hows the s cal sun these days? Any new investors off the boat buying n your hood?
Encino, CA Housing Prices Collapse 34% YoY At Peak Of Selling Season; Inventory Balloons 59% As Demand Dives 5%
http://www.movoto.com/encino-ca/market-trends/
http://www.zillow.com/local-info/CA-Los-Angeles/Encino-home-value/r_51906/#metric=mt%3D30%26dt%3D1%26tp%3D5%26rt%3D8%26r%3D51906%252C118208%252C27080%252C268496%26el%3D0
Phoenix, AZ Housing Demand Plunges 25% YoY; Falls To Record 10 Year Low
http://www.zillow.com/local-info/AZ-Phoenix-home-value/r_40326/#metric=mt%3D30%26dt%3D1%26tp%3D6%26rt%3D8%26r%3D40326%26el%3D0
Bubbles, bubbles everywhere…but Yellen doesn’t see them.
http://theeconomiccollapseblog.com/archives/bubbles-bubbles-everywhere
David Stockman (former Reagan Budget Director): How the Fed is destroying capitalism.
http://davidstockmanscontracorner.com/time-for-regime-change-at-the-eccles-building-interest-rate-pegging-is-destroying-capitalism/
Looks like the smart money is quietly manning the lifeboats before the steerage class passengers look up from DWTS and see the iceberg dead ahead.
http://www.bloomberg.com/news/2014-07-10/gold-near-week-high-on-federal-reserve-minutes-mideast-tension.html
The Free Shit Army (Detroit Corps) mobilizes to stop their water from being shut off for non-payment. They are also threatening to take stronger measures. No justice no peace and all that. Maybe someday they’ll make the logical leap between voting for corrupt and incompetent municipal leadership and their current plight, but I doubt it.
http://america.aljazeera.com/articles/2014/7/10/detroit-water-protests.html
Ben Bernanke’s “legacy”: the gift that keeps on giving.
http://www.atimes.com/atimes/Global_Economy/GECON-01-141113.html
Only a government can destroy an economy. Only unrestrained demagogues in charge of key policy making can spread agony and misery. Back in the 1950s, professor Milton Friedman feared that a mad chairman could be in charge with the Federal Reserve (Fed) and play havoc with the United States economy.
Although the US Constitution Article I, section 8, clause 5 provides: “The Congress shall have power … to coin money, regulate the value thereof, and of foreign coin, and fix the standards of weights and measures … [and clause 6:] to provide for the punishment of counterfeiting the securities and current coin of the United States”, he urged constitutional laws that would restrain the discretionary power of a Fed chair and subject money supply to a fixed rule.
Friedman along other economists such as Ludwig von Mises, Maurice Allais, and Lionel Robbins rejected any central bank intervention in the labor markets, fixing of interest rates, or stabilizing prices. While famous writers (eg, Mises, Ron Paul, and Murray Rothbard) strongly called for abolishing the Federal Reserve, others, including Friedman, called for restraining money supply to a fixed growth rate of 2%-4% regardless of the state of the economy.
The prophecies and fear of Friedman have been fulfilled by the economic and money chaos of present Fed chairman Ben Bernanke’s policies.
With an unorthodox and inflexible mind, Bernanke forced inflationism as a key policy maker of the George W Bush administration. His cheap-money policy caused the worst financial crisis in post-war period and undermined the US and other key economies. Years of disorders and misery followed two decades of prosperity.
In the United States, millions are unemployed; more than 50 million live on food stamps. Europe, Japan, and the US are all forced into reciprocal money destruction: the fight of the Kilkenny cats.
Define irony: Senator McCain, who along with his oligarch backers has done more than any single politician to push “immigration reform” and open borders, now tries to throw his weight around at a migrant detention center dealing with the mess he helped create.
http://www.dailymail.co.uk/news/article-2687785/I-want-today-You-understand-Angry-John-McCain-slams-Border-Patrol-chief-shutting-lawmakers-illegal-immigrant-detention-centers.html
http://www.borderlandbeat.com/2014/07/baby-zetas-caught-with-vids-depicting.html
Some of the “children” flocking across the Texas border may not be the cuddly type that Nancy Pelosi wanted to take home with her.
“Stocks are historically volatile during the second year of the four-year presidential cycle, which is this year. Since 1962, the S&P 500 has suffered a correction of at least 14% in 10 of the prior 13 midterm election years, according data compiled by Strategas Research Partners. In the other three years, pullbacks ranged between 8% and 9%.”
http://blogs.wsj.com/moneybeat/2014/02/10/morning-moneybeat-midterm-election-casts-cloud-on-stocks/
Well shut my mouth!
I’m now leaning toward bearish side for the 2014 year. And 2015 year.
Sell your biggest gains and HOARD the gains under your mattress.
“Slappin’ down those one hundred dollar bills [Selfish Hoarder says:] One hundred! Two hundred!” - Bono (the now self-admitted free market capitalist)
Correction Protection: 10 year notes and gold? I say 52-week T-bills and precious metals (physical and mining stocks). They are uncorrelated to S&P 500. T-bills instead of 10 year notes because the rates are bottomed. October is the end of the junk bond buyback and long term rates will drift up. You won’t like your 2.54% rate 10 year note when you could own 5% yield 10 year note. You won’t want your 5% 10 year note when you could own 10% yield ten year note.
That was from my former self.
“You know what feels great?”
“No. What feels great?”
“The splitting headache I get from that extra wad of $100s hoarded into my pillowcase while I sleep on it overnight.”
You won’t want your 5% 10 year note when you could own 10% yield ten year note.
Now you’re getting me all excited!
OTOH:
http://www.moneyshow.com/articles.asp?aid=GURU-40486
What to do then?
Sell your biggest gains. Hoard cash.
Buy Treasurys now or get priced out forever.
July 10, 2014, 4:25 p.m. EDT
Treasurys rise for fourth day on Portugal banking woes
Revived concerns over European banking sector led risk-off trade
By Ben Eisen, MarketWatch
NEW YORK (MarketWatch) — Benchmark Treasury yields dropped for a fourth consecutive session on Thursday, but an early knee-jerk fall began to reverse as fears about Portugal’s banking system faded.
The 10-year note (10_YEAR -0.08%) yield, which moves inversely to price, was down a basis point on the day at 2.536%, but dropped as low as 2.494% in morning trade, a six-week low on a closing basis. The four-day drop in yields was the biggest since the end of May.
…
Yeah get priced out of low rates forever. Cuz rates are going to go up.
Buy T-bills now. Sell Treasury bonds, sell 7 year notes, and sell 10 year notes.
At the rate people are buying up 10 year notes, by September the yield will be 2.3%. Who wants that? Maybe today’s traders who sell the 2.54% yield 10 year notes today is doing so because he knows all the losers are buying up lower yield rates.
The rates will do a reverse in 2015. The big shot traders will have left long ago and the peanut gallery will be left holding the bag of 10 year notes that yield maybe 2.1% while in September 2011 the new issues yield 4%.
Whazzup with those plunging Treasury bond yields? Check out the 30-year since the beginning of the year, for instance. Down, down, down the rabbit hole we go!