The Housing Bubble

Crater, craytor, creightor, kraetor!

And once prices drop this time there ain’t gonna be a cartel of hedge funds colluding with the realtors to get the properties before they show up to the public.

Triple-Digit Heat Wave Grips Southern California
Posted by Chris Jennewein on October 4, 2014 in Life
Sunset on the San Diego coast.
Photo by Chris Stone

Triple-digit temperatures, Santa Ana wind conditions and low humidity have prompted fire advisories across much of Southern California this weekend.

A heat advisory is in effect until 8 p.m. for San Diego County. Temperatures are forecast to reach the 90s along the coast rise to around 100 just a few miles inland and across the foothills and lower elevations of the mountains.

In Orange County, a heat advisory is also in effect until 8 p.m. Saturday.

A red flag warning indicating a high risk of wildfire will stay in effect in mountain, forest and valley areas of Los Angeles and Ventura counties until as late as Sunday in some areas.

“The combination of rising temperatures, very low humidity and offshore breezes in combination with critically dry vegetation will bring a high fire danger to much of southwest California through this weekend,” according to a National Weather Service statement.
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Hackers’ Attack Cracked 10 Financial Firms in Major Assault
By Matthew Goldstein, Nicole Perlroth and David E. Sanger
October 3, 2014 9:39 pm

The huge cyberattack on JPMorgan Chase that touched more than 83 million households and businesses was one of the most serious computer intrusions into an American corporation. But it could have been much worse.

Questions over who the hackers are and the approach of their attack concern government and industry officials. Also troubling is that about nine other financial institutions — a number that has not been previously reported — were also infiltrated by the same group of overseas hackers, according to people briefed on the matter. The hackers are thought to be operating from Russia and appear to have at least loose connections with officials of the Russian government, the people briefed on the matter said.

It is unclear whether the other intrusions, at banks and brokerage firms, were as deep as the one that JPMorgan disclosed on Thursday. The identities of the other institutions could not be immediately learned.

The breadth of the attacks — and the lack of clarity about whether it was an effort to steal from accounts or to demonstrate that the hackers could penetrate even the best-protected American financial institutions — has left Washington intelligence officials and policy makers far more concerned than they have let on publicly. Some American officials speculate that the breach was intended to send a message to Wall Street and the United States about the vulnerability of the digital network of one of the world’s most important banking institutions.

“It could be in retaliation for the sanctions” placed on Russia, one senior official briefed on the intelligence said. “But it could be mixed motives — to steal if they can, or to sell whatever information they could glean.”
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J.P. Morgan doesn’t plan to inform victims of cyber attack
Published: Oct 4, 2014 8:45 a.m. ET
With two-thirds of U.S. households impacted, consumers must be vigilant
By Priya Anand
Consumer fraud reporter
Reuters

J.P. Morgan Chase won’t notify those customers who have been affected by its summer security breach — estimated to be two-thirds of U.S. households — that their personal information was exposed, a spokesperson for the bank told MarketWatch.

When asked why, the spokesperson said, “That’s just what we’re doing.”
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A rented snowblower will never feel like a real snowblower.

Someone has convinced people in Phoenix that you need to put on a “winter lawn” and have all the houses smelling like manure for a week or two.

Housing, Economy Stuck in Catch 22
Author: Tory Barringer October 2, 2014

On the one hand, the housing market is, by most indicators, edging back toward normalcy; but on the other hand, recovery is snagged by a paradox: In order for housing to get better, the economy needs to heal, but the economy can’t fully heal without a stable housing market.

According to the latest Trulia Housing Barometer, while home prices, sales, and delinquency rates are almost of the way back to normal, new construction starts and a poor employment rate among young adults are snagging full economic recovery. However, all five indicators have improved year-over-year, if slightly in some areas.

Existing home sales, excluding distressed sales, are the most encouraging stats at the moment. These, according to Trulia and the National Association of Realtors, were 80 percent back to normal in August. That’s up from 64 percent in the previous quarter and 79 percent from a year ago. Trulia’s Bubble Watch also showed that prices were 3.4 percent undervalued in the third quarter, which is a marked improvement over the 13.5 percent undervaluation at the worst of the housing bust. That means prices are three-fourths of the way back to normal.

Delinquency and foreclosure rates also were much improved. According to Trulia and Black Knight, the national delinquency and foreclosure rate was 74 percent back to normal in August—the same as one quarter ago and up from 56 percent one year ago. Trulia’s chief economist, Jed Kolko, said that with the share of mortgage borrowers with negative or near-negative equity dropping, the default rate should continue to drop.

Where the trouble lies is in new construction starts, which are not even halfway back to normal, and employment among millennials, which is faring even worse. Though new starts are up from a paltry 37 percent a year ago, they’re still only 49 percent back to normal, according to Trulia and the U.S. Census. And according to Kolko, household formation looks too weak to support more single-family homebuilding.

Most distressing is the employment rate for young adults. The barometer showed that as of August, 75.7 percent of adults age 25 to 34 are employed. This is just 37 percent of the way back to normal.

“Because young adults need jobs in order to move out of their parents’ homes, form their own households, and eventually become homeowners, the housing recovery depends on millennials finding work,” Kolko said.

That’s not to say, however, that housing isn’t doing anything for the economy. Rising home prices make homeowners wealthier, and the more wealth people have, the more they spend, Kolko said. In addition, the decline in defaults and foreclosures have helped stabilize the financial system and hard-hit neighborhoods.

“As we’ve seen, home prices right themselves, as undervalued homes attract investors and other buyers, pushing prices back up,” he said. “In turn, higher prices make defaults less likely.”

But as the housing recovery continues, it depends less on the rebound effect—the tendency of housing prices to right themselves—and more on such fundamentals as jobs, income growth, and household formation.

“In this recovery, jobs and housing can’t get what they need from each other,” Kolko said.
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Whatever became of the savvy under-30 folks who were snapping up homes like hotcakes back in 2006?

Lack of decent paying jobs contributes as well.

Opinions
China’s trapped transition
Police officers stand guard outside of the Hong Kong’s Chief Executive C.Y. Leung’s office on October 2, 2014 in Hong Kong. (Anthony Kwan/Getty Images)
By Fareed Zakaria
Opinion writer October 2

In 2006, Chinese American scholar Minxin Pei published a book called “China’s Trapped Transition.” In it, he invoked the most established “law” in political science — that over time, countries that grow economically tend to become more democratic. (Oil-rich states are the exception.) China had achieved decades of growth, Pei pointed out, yet had made almost no moves toward openness. In private and public conversations around the publication of his book, he predicted that problems would emerge in six to seven years — in other words, right about now. So, I asked him, is what we are witnessing in Hong Kong a major crisis?
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China services growth dips to eight-month low in September: official PMI
By Koh Gui Qing
BEIJING Thu Oct 2, 2014 11:44pm EDT
Security guards are seen on duty in front of a jewellery store in Kunming, Yunnan province May 8, 2014. REUTERS/Wong Campion

(Reuters) - China’s services sector grew at its slowest pace in eight months in September after new orders shrank for the first time since the 2008 global financial crisis, a survey showed on Friday, exposing more weakness in the world’s second-largest economy.

The official non-manufacturing Purchasing Managers’ Index (PMI) edged down to 54.0 in September from 54.4 in August, the National Bureau of Statistics said, but still well above the 50-point mark demarcating growth on the month from a contraction.

In a sign that China’s cooling property market remained a key drag on the economy, the PMI showed the real estate sector shrank in September, alongside other industries such as logistics and aviation.
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Are you a China bear?

China
Hong Kong Protests Trigger New Worries for China’s Economy
By Dexter Roberts
September 30, 2014
Demonstrators sheltering beneath umbrellas during heavy rain as they protest on Tuesday outside Hong Kong’s central government complex
Photograph by Lam Yik Fei/Bloomberg

What is the potential long-term economic and business impact of the massive protests sweeping Hong Kong? That’s being considered by a number of investment analysts, who have issued quick reports over the past two days.

Not surprisingly, no one is ready to make any hard, fast predictions just yet. That’s because of continuing uncertainty about how long the demonstrations will last and the huge question mark over what steps Beijing may take to contain the unrest. Instead, the reports set out possible scenarios and then take brave stabs at possible economic outcomes.

If the protests keep going—an open question at this point—they would hit the tourism and retail industries of Hong Kong hard, which together make up about 10 percent of the territory’s gross domestic product, according to estimates from London-based Capital Economics. The two sectors would be “badly affected, as tourists stayed away. Business confidence would also take a dive. With its economy having contracted last quarter, Hong Kong could easily be pushed into recession,” wrote Capital Economics’ Gareth Leather.

Add in the danger that the demonstrations will further damage the strained relations between Hong Kong’s executive and legislative branches, wrote Citigroup Asia Pacific economist Adrienne Lui. That could make it difficult for Hong Kong to pass key economic boosting policies while the territory’s “risk premium looks set to rise longer-term as businesses and investors are increasingly building in higher operational risks, fearing that future protests could escalate and turn more frequent.”
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International
A Crackdown in Hong Kong Would Signal an End to China’s Economic Miracle
William Wilson / October 02, 2014

In terms of the direction of China’s economic future, think of Hong Kong as the “canary in the coal mine.” As the protest movement in Hong Kong grows over concerns about the island’s democratic future, the question is whether Beijing will intervene.

A crackdown, Tiananmen-style or otherwise, would not be wise because Hong Kong remains critical to China’s economy. While Hong Kong’s economy is now only 3 percent the size of the mainland, Hong Kong is China’s most important economic conduit. It handles about one-fifth of the mainland’s foreign trade and is the largest source of foreign capital for mainland companies.

For China to become a high-income country, it must continue liberalizing its financial sector, which remains undeveloped and dominated by the banking system. Hong Kong is the key channel for this liberalization. For example, most of China’s investment comes in and out through Hong Kong. Chinese companies primarily raise yuan-denominated capital through the “dim sum” bond market in Hong Kong. According to The Economist and Dealogic, in the past two years alone, Chinese companies have raised $43 billion in initial public offerings in Hong Kong versus just $25 billion on the mainland exchanges. There are approximately 750 mainland companies listed in Hong Kong with a market capitalization of approximately $1.5 trillion. Later this year, a Shanghai–Hong Kong stock linkage will allow foreigners to buy Chinese listed shares in Hong Kong. (Foreign ownership of Chinese shares is largely restricted from foreigners.)

Hong Kong companies are subject to rigorous international standards of accounting and transparency. Mainland companies sell at some of the lowest valuations in the world given their abysmal investor transparency. Mainland companies will never become global brands without the emulation of Hong Kong’s investor protection.

The loss of Hong Kong would cost China the economic model international investors hope it will emulate. In The Heritage Foundation/Wall Street Journal 2014 Index of Economic Freedom, Hong Kong ranked first out of 186 countries. Within the 10 sub-categories, it ranked first in business, trade, and financial freedoms and second in protection of property rights and investment freedom. China, on the other hand, ranked 137, scoring miserably in investment and business freedoms (152nd and 153rd, respectively) and protection of property rights (139th).

China could easily suppress Hong Kong’s economic vitality through a mishandling of the current political impasse. That would be a clear signal to the world that China’s economic miracle days are numbered.
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William Wilson is a senior research fellow in The Heritage Foundation’s Asian Studies Center. He concentrates on analyzing the economic performance of Asian-Pacific nations and educating Asian leaders in the principles and practices of free markets.

Factory growth faltering from Europe’s engine to Asia powerhouses
Sumanta Dey and Wayne Cole, Reuters | October 1, 2014 7:52 AM ET
In Germany, factory activity shrank for the first time in 15 months in September suggesting the engine of the eurozone economy may be running out of steam.

BANGALORE/SYDNEY — Dwindling demand cut factory activity across much of Asia and Europe in September, sending it to multi-month lows and raising the chances that global growth will slow in the months ahead.

Despite gentler price rises, China’s figures were mired barely above contraction, Britain slumped, and the drop in new orders did not even spare Germany, the strongest member of the eurozone currency bloc, or France, its No. 2 economy.

With growth faltering, the data will dishearten policymakers in the 18-nation union as they struggle to revive inflation.

Eurozone factories’ final September PMI was 50.3, a further slackening in pace and its lowest reading since July last year, as new orders contracted for the first time in more than a year.
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China credit crash would make ‘2008 look like a garden party’
William Pesek, Bloomberg News | July 18, 2014 | Last Updated: Jul 18 11:11 AM ET
More from Bloomberg News
Investors protest outside the Legislative Council accusing local banks of misleading them in investment products from failed US investment bank Lehman Brothers in Hong Kong on October 8, 2008. Some analysts say a Chinese credit crash would dwarf the Lehman crisis.
Mike Clarke/AFP/Getty Images

Few moments in modern financial history were scarier than the week of Sept. 15, 2008, when first Lehman Brothers and then American International Group collapsed. Who could forget the cratering stock markets, panicky bailout negotiations, rampant foreclosures, depressing job losses and decimated retirement accounts — not to mention the discouraging recovery since then?

Yet a Chinese crash might make 2008 look like a garden party. As the risks of one increase, it’s worth exploring how it might look. After all, China is now the world’s biggest trading nation, the second-biggest economy and holder of some US$4 trillion of foreign-currency reserves. If China does experience a true credit crisis, it would be felt around the world.

“The example of how the global financial crisis began in one poorly-understood financial market and spread dramatically from there illustrates the capacity for misjudging contagion risk,” Adam Slater wrote in a July 14 Oxford Economics report.
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China’s shadow banking system could bring down the world’s hottest property markets
Mamta Badkar, Business Insider | July 7, 2014 | Last Updated: Jul 7 1:21 PM ET
China saw US$464 million in outbound real estate investment Q1 in 2014 into Chicago. US$38 million into London, US$242 million into Sydney, US$150 million in Melbourne and US$144 million into Los Angeles.

Chinese investors are major players in the international real estate markets.

The country’s outbound property investment totaled US$2.1 billion in Q1 2014, according to Jones Lang LaSalle.

And now there are concerns about the quality of the loans that have fed into international property markets.

“Will China’s capital flight fuel property bubbles overseas or cause a collapse when China’s liquidity dries up?” wrote Andrew Collier, managing director, Orient Capital Research.

In an email titled “Will China’s Shadow Banking Kill the International Property Market?” Collier writes that the US$2.1 billion figure most likely understates true outbound Chinese property investment because it is hard to track shadow lending.

“Shadow lending is about 40% of total loans so the figure for property investment could easily be double US$2.1 billion — or more,” writes Collier. “More important, the funds are targeted in just a few places; just three cities, Chicago (who knew?), London and Sydney account for 50% of investment. No doubt, Los Angeles and New York will catch up soon.”
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Financial Times
ft dot com/global economy
September 28, 2014 3:18 pm
Geneva Report warns record debt and slow growth point to crisis
By Chris Giles, Economics Editor
Growth in China has slowed from double digits to 7.5%
©Bloomberg

A “poisonous combination” of record debt and slowing growth suggest the global economy could be heading for another crisis, a hard-hitting report will warn on Monday.

The 16th annual Geneva Report, commissioned by the International Centre for Monetary and Banking Studies and written by a panel of senior economists including three former senior central bankers, predicts interest rates across the world will have to stay low for a “very, very long” time to enable households, companies and governments to service their debts and avoid another crash.

The warning, before the International Monetary Fund’s annual meeting in Washington next week, comes amid growing concern that a weakening global recovery is coinciding with the possibility that the US Federal Reserve will begin to raise interest rates within a year.

One of the Geneva Report’s main contributions is to document the continued rise of debt at a time when most talk is about how the global economy is deleveraging, reducing the burden of debts.

Although the burden of financial sector debt has fallen, particularly in the US, and household debts have stopped rising as a share of income in advanced economies, the report documents the continued rapid rise of public sector debt in rich countries and private debt in emerging markets, especially China.

It warns of a “poisonous combination of high and rising global debt and slowing nominal GDP [gross domestic product], driven by both slowing real growth and falling inflation”.

The total burden of world debt, private and public, has risen from 160 per cent of national income in 2001 to almost 200 per cent after the crisis struck in 2009 and 215 per cent in 2013.

“Contrary to widely held beliefs, the world has not yet begun to delever and the global debt to GDP ratio is still growing, breaking new highs,” the report said.

Luigi Buttiglione, one of the report’s authors and head of global strategy at hedge fund Brevan Howard, said: “Over my career I have seen many so-called miracle economies – Italy in the 1960s, Japan, the Asian tigers, Ireland, Spain and now perhaps China – and they all ended after a build-up of debt.”
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Hong Kong crisis exposes impossible contradiction of China’s economic growth
Hong Kong’s crisis comes at a treacherous moment, up to its neck in China’s credit bubble
Student protesters chant democracy slogans in Hong Kong Photo: Paula Bronstein/Getty Images
By Ambrose Evans-Pritchard
9:19PM BST 01 Oct 2014

China’s Xi Jinping cannot make any serious concessions to Hong Kong’s democracy movement. The Umbrella Revolution spreading from the affluent Island to the poorer quarters of Kowloon is an existential threat to the Chinese Communist Party.

“If he were to give way, it would set off contagion across the mainland,” said George Walden, a veteran British diplomat who survived the Cultural Revolution inside China and later negotiated Hong Kong’s future with Deng Xiaoping. Beijing has already blocked all images of the protests in the Chinese media as a political quarantine measure.

“Xi Jinping has a horror of what happened to the Communist Party in the Soviet Union. If things get seriously out of hand, he may mobilise ‘patriotic compatriots’ (Beijing-controlled agitators) on the streets. In the end he will bring out the troops, if he has to,” he said.
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For Hong Kong, the crisis comes at a treacherous moment. The enclave is up to its neck in China’s credit bubble, channelling $1.2 trillion in hard currency loans to Chinese companies. The International Monetary Fund said the “extreme tail event” of a credit shock in China would “entirely wipe out capital in Hong Kong’s banking system”.

Hong Kong’s own housing boom is vertiginous, caused by importing the Fed’s zero-rate policies through a dollar-peg. The global property monitor of the Bank for International Settlements shows that prices have risen 70pc since 2008.

Some Chinese firms have turned to Hong Kong to circumvent credit curbs on the mainland: others have been playing the “carry trade”, borrowing in dollars to buy Chinese property or yuan assets. This has turned bad. Chinese house prices have been slipping for the past five months.

The carry trade was a one-way bet when Fed liquidity was holding down the dollar, but everything has changed. The Fed is now the enemy as it prepares to tighten. The dollar is roaring back, threatening to break its 30-year downtrend. Hong Kong faces a dollar squeeze.

For China’s Communist Party, the Hong Kong drama exposes the impossible contradiction of its policies. Xi Jinping launched a radical reform blitz at the Party’s Third Plenum last November, vowing to break the grip on the giant state-owned companies, sweep away a tangle of price controls and move to a “mixed ownership economy”. He wants to free China from its obsolete development model - shutting down steel foundries and other relics of the investment bubble, still running at 48pc of GDP - and make the leap to a rich, hi-tech, consumer society.

Yet at the same time he is doubling-down on a one-party, one-ideology, authoritarian state. This is untenable. Hong Kong demonstrates the iron law that demands for freedom rise with economic sophistication. Shanghai, Guangzhou, Beijing, Tianging and Chengdu are not that far behind.
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4 October 2014, 14:56
China’s soaring debt rate highlights global economic problem
Traffic in Beijing

A new report by leading economists has cast doubt on the economic recovery, saying the world hasn’t worked itself out of the financial crisis. While it was western economies that led the world into the crisis of 2008, China and other developing countries are now facing a growing ratio of debt to GDP. VoR’s Carmen Cracknell reports.

The Geneva Report, compiled by the International Center for Monetary and Banking Studies (ICMB), warns that global debt is at crisis levels. It singles out China, whose debt rate is rising at a particularly steep rate.

Most developing countries were cushioned from the economic crisis of 2007. Then, global debt accumulation was the burden of developed economies - the US, Britain, and others in western Europe.

But economists say that since then, it is emerging economies that are causing stagnation in the global financial system.

Professor Stephen Keen, head of the School of Economics, History & Politics at Kingston University and author of the Debunking Economics book series, explained how China had accumulated so much debt:

It’s partly because it is becoming a capitalist nation very dramatically and that expanded role for the public sector in creating money. It’s also because when the crisis hit back in 2007 the Chinese response was to dramatically increase credit. And that fuelled an enormous property bubble in China which has fuelled talk of ghost towns. To fund these developments an enormous amount of money was developed from both the official and shadow banking system.

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The good news is that the boom has not been fuelled by leverage.

And on that note, I would like you to consider buying some Florida swampland I have for sale.

Breakingviews
China house prices on brink of pessimism spiral
By John Foley
September 30, 2014

China is rare in many ways, but its housing market is just as dependent on psychology as everywhere else. After years of gains, prices are now falling in most Chinese major cities. When negative thinking sets in, it’s hard to escape the pessimism spiral.

House prices can be notoriously volatile. In OECD countries between 1970 and 1995, a 40 percent price gain over six years was typically followed by at 25 percent decline over the subsequent five. Later studies show a bank crisis makes the correction deeper and longer. China looks due a correction. Average house prices in 40 big cities, according to data from the China Index Academy, have now risen 49 percent in 5 years.

The good news is that the boom has not been fuelled by leverage. The 5.1 trillion yuan ($838 billion) of new housing loans extended since 2010 is just 20 percent of the value of houses bought during that time, government data shows. That reduces the risk of households being forced to sell, or getting trapped in negative equity.

Nevertheless, falling prices undermine people’s perception of their wealth, and therefore their propensity to consume. Less housebuilding hits demand for materials and labour. Contentment, consumption and activity are crucial to China’s mission of keeping society stable, so can-do politicians and developers are now mooting ideas to coax buyers back to the market.
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9/14/2014 @ 12:18PM
IMF Formula: China GDP Grew 2.2% In 2013
Gordon G. Chang
Contributor

“Ten to 15 years ago, to create 1 million jobs, China needed 1.4% GDP growth,” said Markus Rodlauer, the chief of the IMF’s China mission, in an interview with the official Xinhua News Agency released Friday. “Five to 10 years ago, it needed 1%. Now it only needed 0.8% GDP growth.”

According to China’s Ministry of Human Resources and Social Security, the country added 2.73 million jobs in 2013. If the IMF formula is correct, China grew 2.2% last year.

So what did the IMF forecast for Chinese growth for 2013? On October 8 of that year, the organization issued a prediction of 7.5%.

Obviously something is wrong at the IMF as it is not possible to reconcile 7.5%, the forecast, with 2.2%, the result of applying Rodlauer’s formula. And to make matters worse, the IMF cannot argue that the 2.73 million figure is an anomaly. Low job creation is not a new phenomenon in China: the Human Resources Ministry reported that the number of jobs created in 2012 was 2.84 million.

What is going on? China, like many countries, supplies data on a confidential basis to the IMF so that it can conduct what are known as Article IV Consultations. The data China supplied to that organization may not have been the same as the figures the National Bureau of Statistics released to the public. If so, it means the IMF had been staying silent as Beijing issued different—and undoubtedly inaccurate—statistics to the public.
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11:59 am HKT
Sep 30, 2014
Economy & Business
A Look at Just How Much China’s Housing Downturn Could Hurt GDP

Just how much will a downturn in China’s property market hurt the economy? A new analysis by analysts at Japanese bank Nomura sheds some light.

China’s property market won’t recover any time soon, say the analysts, who figure the downturn will shave the country’s GDP growth by 1.4 percentage points in 2014 and 0.6 percentage points in 2015 if there are no drastic changes to policy. In the worst-case scenario, GDP growth could plunge by 4 percentage points.

The analysts came up with three scenarios. If government policy continues at its current pace—piecemeal targeted easing—GDP growth will drop by 1.4 percentage points this year because property takes a big bite out of industries like steel, construction, chemicals and transport.

If the government eases monetary policy by lifting credit curbs, cutting banks’ reserve requirement ratios and interest rates, and rolling out large stimulus packages, the impact on GDP would be smaller this year and next, shaving growth by 1.1 percentage points in 2014 and 0.3 percentage points in 2015. But in the longer term, it could be worse than continuing current policy because debt levels would be pushed higher and the oversupply situation would worsen, the analysts say. “This is a risky strategy as it could eventually lead to an even sharper correction in the sector, and indeed in the wider economy, ahead.”

The third scenario is if the government does nothing and a housing crash ensues. In that case, GDP growth could fall 4 percentage points, the investment firm said. In any case, the downturn could last between two to four years.

“This is not a minor correction,” they said. “This property market downturn is different to those China has experienced in the past. Previous downturns were largely driven by tighter policies while this one appears more naturally driven by market forces.”
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Rising debt threatens to plunge world back into financial crisis, top economists warn
Jeremy Warner, The Telegraph | September 30, 2014 | Last Updated: Sep 30 3:11 PM ET
More from The Telegraph
A trader reacts on Oct. 19, 1987 to a 500 point drop in the Dow Jones as panic selling swept Wall Street on Black Monday.
Getty Images

As if the fast degenerating geo-political situation isn’t bad enough, here’s another lorry load of concerns to add to the pile.

The UK and U.S. economies may be on the mend at last, but that’s not the pattern elsewhere. On a global level, growth is being steadily drowned under a rising tide of debt, threatening renewed financial crisis, a continued squeeze to living standards, and eventual mass default.

I exaggerate only a little in depicting this apocalyptic view of the future as the conclusion of the latest “Geneva Report”, an annual assessment informed by a top drawer conference of leading decision makers and economic thinkers of the big challenges facing the global economy.

Aptly titled “Deleveraging? What Deleveraging?”, the report points out that, far from paying down debt since the financial crisis of 2008/9, the world economy as a whole has in fact geared up even further. The raw numbers make explosive reading.

Contrary to widely held assumptions, the world has not yet begun to de-lever. In fact global debt-to-GDP – public and private non financial debt — is still growing, breaking new highs by the month.

There was a brief pause at the height of the crisis, but then the rise in the global debt-GDP ratio resumed, reaching nearly 220% of global GDP over the past year. Much of the more recent growth in this headline figure has been driven by China, which in response to the crisis, unleashed a massive expansion in credit.

However, even developed market economies have struggled to make progress, with rising public debt cancelling out any headway being made in reducing household and corporate indebtedness.
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Historians will ‘tar and feather’ Europe’s central bankers, says Nobel laureate
Ambrose Evans-Pritchard, in Lindau, Germany, The Telegraph | August 21, 2014 | Last Updated: Aug 21 2:03 PM ET
More from The Telegraph
Economists warned that the European Central Bank, led by Mario Draghi, may not be able to carry out a mass of purchase of bonds unless the eurozone grasps the nettle on fiscal union, and might itself be engulfed by crisis.
Getty Images

An array of Nobel economists have launched a blistering attack on the eurozone’s economic strategy, warning that contractionary policies risk years of depression and a fresh eruption of the debt crisis.

“Historians are going to tar and feather Europe’s central bankers,” said Professor Peter Diamond, the world’s leading expert on unemployment.

“Young people in Spain and Italy who hit the job market in this recession are going to be affected for decades. It is a terrible outcome, and it is surprising how little uproar there has been over policies that are so stunningly destructive,” he told The Telegraph at a gathering of Nobel laureates at Lake Constance.
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Investing
Nothing Grows Forever, Including the Stock Market
Oct 3, 2014 6:03 AM EDT
By A. Gary Shilling
(This is the second article in a two-part series.)

Major stock indexes may be at or near all-time highs, yet I see a number of warning flags for equities. Yesterday, I examined four of them: high price-to-earnings ratios, slow economic and corporate-revenue growth, earnings growth driven by unsustainable cost-cutting and low interest expense, and the end of Federal Reserve stimulus. In today’s column, I examine five more caution signs.

Emerging market woes. Economic growth in China is slowing. Its banking and other domestic problems could spill into other countries. Furthermore, many developing economies are already troubled, especially the poorly managed ones with current-account deficits, weak currencies, high inflation, falling stock markets and rising interest rates.

Less rapid growth in China creates problems for the many other developing countries that export commodities and other products to China, especially Indonesia, South Africa, Brazil and Turkey, all of which suffer from current account and government deficits, high inflation and weak currencies. The robust greenback is straining emerging economies with sizable debts denominated in dollars.
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Will the Stock Market Finish 2014 With a Bang or a Crash?
Dan Caplinger
Oct 2nd 2014 1:08PM
Fortune teller
Cora Reed/Shutterstock

For more than five years now, the U.S. stock market has mostly soared upward as the global financial system emerged from the wreckage of the housing bust, the banking crisis and the ensuing market meltdown. Yet several looming threats could put the brakes on those gains, and investors appear increasingly nervous about whether stocks will keep providing the returns they’ve grown accustomed to. Let’s look at what the rest of 2014 is likely to bring.
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Sometimes it’s useful to examine what is happening with stock groups.

Go here for a peek at the charts of some major groups:

http://finviz.com/groups.ashx?g=sector&v=410&o=name

Notice that the stocks that make up Basics Materials has rolled over and is in decline while, at the other end of the spectrum, the Healthcare group is still going strong.

Jessie Livermore uses to pay attention to groups and as the market matured he would sell the weak groups and hang onto the strong ones until they, too, showed signs of weakening.

The point being … the market does not roll over enmass, instead each group - each sector - has its day.

FWIW.

Is the stock market bubble of 2014 ready to burst?
Published: Sept 25, 2014 1:21 p.m. ET
By Thomas H. Kee Jr.

Is the stock market in a bubble? The answer is yes, absolutely, you bet it is. The interesting part is that it is not the only asset class that is in a bubble. In addition to the stock market, real estate is also in a bubble, and these prices have absolutely been influenced by FOMC policy.

Although I’m not making observations outside of the United States, the policy of central banks to inflate asset prices using a tool invented, it seems, by Ben Bernanke certainly has reshaped economic conditions, and thus far, they have prevented a Greater Depression. But before the stimulus packages were enacted, back when the credit crisis made everyone concerned about the economy, I was warning about something that no one wanted to hear.
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Here are Professor Bear’s tips for surviving a market panic:

1) DON’T PANIC!.

2) In case you feel an uncontrollable urge to panic, PANIC FIRST!!!!!!

crater

It was a bleach solution, not just water. I don’t understand why the apartment hasn’t been sprayed with a bleach solution as well. His family probably has Ebola by now. I can’t believe we are allowing travel to and from the Ebola countries without quarantine. Shouldn’t this be on the President’s radar? I also think the hospital who sent him home should have to pay for their part in this.

Didn’t work for me. This one did:
Dallas: Workers Spray Ebola Patients’ Vomit Off of Sidewalk with Pressure Washer and No Protective Clothing (Photos and Video)

And extend the x axis to the left and you’ll see just how grossly inflated housing prices really are.

Last time U.S. home prices rolled, the Fed targeted QE3 at MBS purchases beginning in early 2012 to end the tailspin. All-cash foreign and hedge fund investors piled in to capture their shares of the gains, creating an Echo Bubble in the process.

Now that the Fed is winding down QE3, what will prop up U.S. home prices from here on out?

Also, he was just lying, bullsharting to make his point pimping for Mo Credik. Simple salesman BS. Did he actually apply?

Oligarchs qualify for everything.

“Maybe when the bank asked how he planned to repay the loan, he said that he’d just print some money…”

+1 LOL!

$65 million? Why does it cost so damn much? Hmm makes you wonder who’s payoffs or bribes are embedded in there.

“Now, contrast that with the arrogant, intolerant, petulant, radical-left environmentalist Robert F. Kennedy, Jr. Last week, at the People’s Climate March in New York,”

Robert F Kennedy Jr loses his cool and grabs mic from reporter pushing him about his own carbon footprint

Published: 11:30 EST, 22 September 2014

He was a leading figure in one of the biggest climate change marches to date.

But it seems Robert F Kennedy Jr was not so forthcoming when it came to questions about his own carbon footprint.

Confronted by a reporter asking if he would give up his phone and car, the environmental lawyer became visibly irate before grabbing the microphone and accusing her of ‘destroying democracy’ as a member of the press.

SCROLL DOWN FOR VIDEO

‘Are you concerned about the damage that the cell phone and electricity generation causes to the environment?’

He exclaimed: ‘Are you joking about this!’

‘No, I want to know if you’re willing to give up your iPhone,’ she asks.

‘No.’

‘Why not? Doesn’t it start with people like you?’

‘No.’

The conversation then fell into confusion.

Fields asked: ‘So will you lead by example?’

Kennedy Jr interrupted: ‘No no…I do lead by example.’

‘Are you going to give up your cell phone?’ she said.

‘No,’ he responded.

‘Are you going to give up your car?’

Visibly aggravated, Kennedy Jr pointed his finger in the reporter’s face and barked: ‘Are you going to give up your car?’

She calmly responds: ‘I’m not the one who’s here talking about the environment’.

The multi-millionaire then declared he will not stop using a phone or a car because he does not believe that quality of life should be sacrificed for the environment.

Read more: http://www.dailymail.co.uk/news/article-2765461/Robert-F-Kennedy-Jr-loses-cool-grabs-mic-reporter-pushing-carbon-footprint.html#ixzz3FDMJ6qSR
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“Case-Shiller Index Is Flawed”

It’s all flawed. In this part of Region IV back in 2009 house prices started to collapse but then stopped, held at that level for a couple of years and then started to rise again.

Why did they stop collapsing in 2009 when they should have continued to tank? I don’t know, seems flawed to me.

Why did house prices start to rise again in 2011? I don’t know, seems flawed to me.

Flaw 2 : Too Few “Home-Types” Included

A second Case-Shiller Index flaw is its methodology.

The index considers only “repeat sales” of the same home in its findings, and those homes are required to be single-family, detached properties. This means that condominiums, multi-family homes, and new construction are not included.

What can a “repeat sales” index tell you about current home prices when nothing is selling?

Suggested response to Ebola scare:

1) DON’T PANIC!

2) By all means, keep buying stocks, houses and other risky assets on leverage.

There are only a handful of direct flights from the U.S. to Africa.

The guy in Dallas flew in via Europe.

Are you concerned whether flights are coming in to your local airport from Dallas?

Strong dollar, rising volatility mark Q3 markets. Same again in Q4?
By Jamie McGeever
LONDON Tue Sep 30, 2014 8:31am BST
Employees of a foreign exchange trading company work under monitors displaying Japan’s Nikkei stock average (bottom) and the Japanese yen’s exchange rate against against the U.S. dollar as a television screen (R) shows the Scottish independence vote news in Tokyo September 19, 2014. REUTERS/Toru Hanai

(Reuters) - The biggest scramble for dollars and sharpest rise in currency volatility for years were the hallmarks of financial markets in the third quarter, developments which have intensified worries that the final three months of the year might be equally bumpy.

The dollar’s 7-percent surge was its biggest quarterly rise since the same period in 2008, when the collapse of Lehman Brothers triggered the global financial crisis and a worldwide rush into the U.S. currency.

The swing of such a magnitude in the world’s reserve currency, which is used to price almost everything in global commerce from Apple shares to zinc, permeated all financial markets. It lifted volatility, and crushed the value of commodities and emerging market currencies in the process.

The biggest gainer from 22 assets and market instruments tracked by Reuters was China-listed A-shares, which rose 16.1 percent, and the biggest loser was Brent crude oil futures, which fell almost 14 percent. More than half of the 22 fell.

Much of what the fourth quarter holds will hinge on how much faith investors retain in their collective belief that the U.S. economy will outperform its peers, the Federal Reserve will soon raise interest rates, and the dollar will strengthen further.

Contrast that to the euro zone, where deflation fears grew in the third quarter, the European Central Bank eased historically loose policy even further and, remarkably, 10-year German government bond yields fell below 1 percent.

“The dollar move is not going to hurt the U.S. economy in any appreciable way, certainly not at this point,” Deutsche Bank chief U.S. economist, Joe LaVorgna, said, noting that the United States is producing much more of its own energy and so slashing its import bill and trade deficit.

“This is all good. The Fed has been perpetually disappointed by the evolution of the economy, but monetary policy has to be forward-looking,” he said.

Investors buying the dollar against a basket of six major currencies on July 1 would be 7.4 percent better off today and almost 8 percent in the black if they had bought the dollar against the Japanese yen.

The dollar also rose against the euro, which buckled under the weight of grim views on euro zone growth and inflation.

Throw in the a late flurry of jitters around the Scottish independence referendum this month, and implied volatility in major exchange rates hit their highest levels this year. In the case of short-dated pricing, especially in sterling, it was the most volatile period in years.

Morgan Stanley, global head of currency strategy, Hans Redekerat, expects this to remain a feature of the coming months as the dollar rises further and exchange rates provide the shock absorber to shifting global economic plates.

“Economic decoupling never takes place, so in an environment of non-synchronised global growth the exchange rate always comes back under the spotlight,” he said.

“Two thirds of global funding costs is determined by U.S. dollar funding rates. Volatility is going to stay with us and is going to normalise,” he said.
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Cue up a suggestion to buy the dip after my next post.

Oil slides to multi-year lows; WTI at lowest in 1-1/2 years
22 Hours Ago
Reuters

Global oil prices extended a months-long rout into bear market territory on Friday, with Brent notching a new 27-month low as the dollar spiked following upbeat U.S. employment data and further signs of undiminished crude supply.

The rallying U.S. dollar has re-emerged as a key driver for commodity prices in recent months, making raw materials more costly for most importers and reviving a once-popular spread trade. It reached a more than four-year peak on Friday after a report showing the U.S. economy created more jobs than expected last month, putting unemployment at a six-year low.

Brent crude for November delivery fell more than $1 to $92, after earlier touching $91.48 a barrel, its lowest since June 2012. It has fallen by 21 percent since June, when it climbed near $116 following the incursion of Islamist militants into Iraq.

U.S. November crude ended down $1.27 at $89.74 a barrel, its lowest close since April 2013. The contract has lost around $2 this week.

Analysts cited rising production from Russian oil fields emerging from maintenance, and a report from this week showing OPEC production hitting two-year highs of 31 million barrels per day (bpd)in September.

Investment bank Goldman Sachs said in a note sent to clients on Wednesday that $90 per barrel was a reliable floor for Brent in the medium term, also citing the strength of the dollar and the mismatch between supply and demand.
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Strong Dollar Set to Reign as Euro, Yen Continue Swoon
Currencies Expected to Diverge Further as U.S. Growth Surges While Europe, Japan Falter
By Ira Iosebashvili
Sept. 30, 2014 11:44 a.m. ET
The speed of the dollar’s rise has surprised some analysts, but with the Fed poised to raise interest rates, most expect its rally to continue. Bloomberg News

Investors are betting that the euro and yen have further to fall, as economic expansion falters in the eurozone and Japan while U.S. growth surges.

Since July, the yen is down more than 8% against the dollar at ¥109.459, its lowest level in six years. The euro is off 7% at $1.2686, nearly a two-year low.

Driving the declines is a belief that a strengthening U.S. economy will prompt the Federal Reserve to raise interest rates, a move that would boost the value of the dollar by making it more attractive to yield-seeking investors. At the same time, investors expect the European Central Bank and the Bank of Japan to keep rates at historic lows or reduce them further, as they continue to pump out economic stimulus in an attempt to kick-start growth.

“After many months, we are finally seeing the dollar diverge with the euro and yen, thanks to the different monetary policies at central banks,” said Peter Gorra, head of foreign exchange at BNP Paribas in New York.

Recent moves by the central banks have highlighted their contrasting approaches. At its Sept. 17 meeting, the Fed outlined a strategy for what would be its first interest-rate increase since 2006. The move sent the dollar soaring against its peers, although the central bank reassured investors that borrowing costs will remain low for a considerable time. The Fed is on track to wind down its economic stimulus program in October.

The Fed’s meeting came almost two weeks after the ECB surprised investors by cutting interest rates deeper into negative territory and announcing new stimulus plans to combat dangerously low inflation and spur bank lending. Traders reacted by dumping euros, sending the currency on its steepest one day drop against the dollar in nearly three years.

That reaction may have been just what the ECB wanted, investors said. A weaker euro helps the European economy by making imports more expensive while boosting the price of exports, helping raise the profits of domestic producers. Now that the central bank appears determined to further ease monetary policy, the euro likely has much further to fall, said Aroop Chatterjee, a strategist at Barclays.

“We now expect a large, multiyear downtrend in the euro,” Mr. Chatterjee said, adding that he expects the currency to fall to $1.10 in the next year. “Much of this depreciation is likely to come in the next six months.”

Meanwhile, Japan’s economy contracted in the second quarter at the fastest pace since 2009, leading some investors to believe the BoJ will be forced to bolster its already historic stimulus, which it began in April 2013. The news sparked a fresh round of yen selling, breaking the currency out of eight months of near standstill against the dollar. On Friday, consumer price data showed inflation up just 1.1% from a year earlier in August, after adjustments were made to strip the effects of an April sales-tax increase and volatile food prices. That fell short of the central bank’s 2% target.

Mr. Gorra of BNP Paribas is betting on the dollar to hit ¥111 in the next few weeks and expects the euro to fall to $1.25.
…

Gold’s five year low was $1017. That was five years ago. Currently it is $1191. 14.7% higher today than five years ago. Who is saying gold is overvalued and about to crater?

Weekend Investor
Bonds: What to Do Now
Bill Gross’s Departure From Pimco Raises Five Timely Questions for Investors
By Jason Zweig and Liz Moyer
Updated Oct. 4, 2014 9:48 a.m. ET
Bill Gross, co-founder and former chief investment officer of Pacific Investment Management Co. Some investors sold shares of Pimco Total Return Fund as soon as they heard Mr. Gross was leaving. Zuma Press

The stunning departure of Bill Gross from Pimco raises important questions for investors.

Mr. Gross, the world’s most influential bond manager, left Pacific Investment Management Co. abruptly on Sept. 26, roiling fixed-income markets and sending at least $23 billion scurrying out of Pimco Total Return Fund, the fund he led, which had $222 billion in assets at the end of August. He joined Janus Capital Group, where, starting Monday, he will run the Janus Global Unconstrained Bond Fund, which was launched in May 2014 and has $13 million in assets.

For investors, it is an opportune moment to re-evaluate their bond strategy. Chances are, you don’t need to take urgent action.

Here are answers to five questions that can help you determine what to do—and not to do—if you are a Pimco Total Return investor, if you are worried about rising interest rates, if you are wondering what purpose bonds serve now and if you aren’t sure which kind of bond fund is right for you.
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Bloomberg News
Bond Warnings Rise as ’94 Parallels Seen in Fed-CPI Split
By Daniel Kruger September 29, 2014
U.S. Growth
Pedestrians walk through a farmer’s market in the Ballard neighborhood of Seattle, Washington. Economists project 3 percent growth in the U.S. in 2015, which would be the fastest in a decade, according to data compiled by Bloomberg. Photographer: Mike Kane/Bloomberg

For bond investors who are convinced a lack of inflation will keep the Federal Reserve from upending Treasuries when it begins to raise interest rates, there’s one parallel in history that suggests they still have cause for concern.

The last time consumer-price increases were slowing before the Fed started increasing borrowing costs was in 1994 — when Treasuries lost 3.3 percent in what was then the biggest selloff on record. At the time, Fed Chairman Alan Greenspan shocked the financial world by doubling the benchmark rate to 6 percent, even though inflation was at a seven-year low of 2.5 percent.

While there’s less inflation now and growth still hasn’t recovered to pre-crisis levels after six years of unprecedented stimulus, the risk is that bond bulls vindicated by this year’s rally are misreading the Fed’s resolve to lift rates from close to zero. Speculators pulled (TLT:US) a record amount of money from long-term Treasuries after Fed Chair Janet Yellen said the bank’s pledge to keep rates low for a “considerable time” may change if the economy picks up more than it expects.
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Markets
Bond Titan’s Job Switch Sets Off Scuffle to Cash In
With Bill Gross Gone From Pimco, Rival Firms Angle for Clients
By Gregory Zuckerman and Kirsten Grind
Oct. 3, 2014 7:41 p.m. ET
Bill Gross, Pimco’s co-founder and chief investment officer. Reuters

The global battle to reshape the $38 trillion bond market began before sunrise on Friday, Sept. 26, when an announcement blinked onto computer screens in the Newport Beach, Calif., offices of Pacific Investment Management Co.

Bill Gross, the firm’s co-founder and chief investment officer, arrived that morning around 5 a.m., earlier than usual, but he didn’t stay long or speak to anyone, according to people familiar with what happened. Just before 5:30 a.m., traders stared at their screens in disbelief.

“William H. Gross, world-renowned fixed income investor, will be joining” Janus Capital Group Inc. to manage a small bond fund based in a new Janus office in Newport Beach, said a news release from the rival firm.

“Did you see that?” a stunned employee asked a colleague.

Mr. Gross, 70 years old, for decades has been the world’s most prominent bond investor, building Pimco into a $2 trillion giant through his commentaries, media appearances and often prescient calls on interest rates and global economic shifts.

As Pimco executives struggled to process the news, phone lines chirped with confused clients. Competitors formulated strategies to steal Pimco’s longtime investors. Tens of billions, if not hundreds of billions of dollars were at stake.

In the staid bond world, investors often stick with their chosen managers for years. With Pimco’s clients suddenly up for grabs, rival firms around the world are rushing to get a piece of the action—a frenzy that could affect some of the world’s top money managers for years to come.

“Gross’s departure is a rare watershed event for the investment world,” said Jack Ablin, chief investment officer of BMO Private Bank, which manages $66 billion. “There’s a massive food fight as bond managers try to steal Pimco’s clients. It’s a shake-up of the entire bond market.”

Late on the Friday Mr. Gross’s departure was announced, Pimco executives outlined a new management structure and employees swung into action, making calls to clients into the night and over the weekend.

Stephanie King, a senior account executive, reached out to a large public pension fund that had more than $1 billion invested with Pimco. A person familiar with the conversation said Ms. King emphasized “the depth of our bench.”

After three calls from Ms. King, the pension executive said he was comfortable with the new Pimco team: “We’re sticking with you.” Ms. King didn’t respond to requests for comment.

It isn’t yet clear how many customers will remain as loyal. Pimco CEO Douglas Hodge has said the firm is “confident that the vast majority of our clients will continue to stand with us.”

On Wednesday, Pimco said a net $23.5 billion left Mr. Gross’s former flagship fund, the Total Return fund, in September, the majority pulled on the day Mr. Gross announced his departure. Research firm Morningstar Inc. said the withdrawals were of “unprecedented magnitude.” Many of Pimco’s biggest clients, including pension funds and other institutions, said they are still seeking advice and weighing a growing volume of sales pitches from competitors.

On Wednesday, a top executive at rival BlackRock Inc, wrote in a note to clients: “Let’s say that you are having doubts about your core bond holding and want to pull some money out….” The note never mentioned Pimco, but BlackRock has received billions of dollars of new investments in the last week, according to a person close to the firm.
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Secret Leveraging of Junk Bonds Revealed in Stock Trade
By Lisa Abramowicz
Oct 3, 2014 9:48 AM PT

If stock investors are any guide, the $1.3 trillion U.S. junk-bond market is being inflated by a growing amount of leverage being used by buyers.

Both stock and junk-bond managers tend to deploy more leverage when markets are booming, and more than ever is being used to purchase U.S. equities, based on levels of margin debt on the New York Stock Exchange, according to UBS AG (UBSN) analysts. That suggests junk-debt buyers are engaging in similar financing activities.

As investors use more borrowed cash, they increase the potential for bigger losses in a downturn. This trend adds to concern that six years of unprecedented Federal Reserve stimulus has produced a bubble in the junk-bond market — and one that will be all the more painful when it eventually pops.

“Rising debt levels will be a problem going forward,” UBS analysts Stephen Caprio and Matthew Mish wrote in a report dated Oct. 2. Investors increase “leverage to meet return hurdles that are more challenging to hit as prices rise.”

Measuring leverage in the junk bond market with any kind of precision is a tricky thing. Caprio said in an interview that he doesn’t know of a direct way to do it.
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Not to worry about the concerns raised below. Always remember: A closely-watched pot never boils over.

ft dot com
October 1, 2014 12:05 pm
Junk bond investors wary of US October ‘jinx’
By Vivianne Rodrigues in New York

October is known on Wall Street as the “jinx”, with many traders and investors relieved to see the month behind them thanks to its fraught history.

It was on October 28, 1929 that the Dow Jones Industrial Average sold off 13 per cent in a day that became known as Black Monday and announced the start of the Depression. Almost 60 years later, on October 19, 1987 the index dumped 508 points, suffering its biggest daily percentage loss of 22.6 per cent, in its second – and largely unexplained – Black Monday. On October 27, 1997, the Dow lost 13 per cent in response to heavy losses on Asian markets.

Junk bond yield

But it is a different group of investors – those betting on junk bonds – who will be approaching the next 30 days with most trepidation.

They are wary of the combination of weaker stock markets and rising US Treasury yields that has been clouding the outlook for high-yield debt, one of the biggest beneficiaries of the Federal Reserve’s quantitative easing policies.

Poor performance and the potential fallout from the departure of Bill Gross from Pimco on junk markets have added to concerns, given the average yields on the debt remain at low levels. After the multiyear rally, there is far less of a cushion in junk bond prices to absorb a stock market sell-off or a prolonged bout of volatility.

“A scenario in which stocks are falling and yields are rising is not great for corporate bonds in general,” says Fran Rodilosso, senior investment officer for fixed income ETFs at Van Eck Global.

“But stocks and high-yield debt are in similar risk-categories. If stock markets get spooked, given that many bond valuations are on the rich side, we can see yields backing up considerably.”
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From the article:

“The $225,000 settlement, first reported by Fresno, California’s ABC30, covers a few store-brand beauty products, mostly wrinkle creams but also an anti-frizz hair product. The report says the points of contention were alleged false bottoms and sides that improperly exaggerated the amount of product in the container.”

Getting this settlement done with 4 counties and the state also probably cost more than $225,000.

Remember when the section of bridge in Cos Cob over the Mianus River fell and a couple of cars and a truck took the plunge? That was just about a year after I moved down here in 83 or so.

“…she must have the breast implants removed and possibly penis reconstruction surgery.”

Should’ve stuck with the equipment God gave her (him).