The Housing Bubble

Until the money runs out.

See my comment on the slave class.

#FundamentalTransformationOfAmerica

‘prettiest girls’

I’ve been to California. Texas has much better looking women.

‘How come all the “neo-marxist enclaves” have…’

And you said you were a conservative.

“I’ve been to California. Texas has much better looking women.”

I’ll second that.

With, or without, make-up? Of course, I lived there for a few intern semesters in college in the generally more make-up-ey 90s, so maybe the South has followed the more au-nauturale trend since.

“I’ve been to California. Texas has much better looking women.”

+1 Indeed. Must be sump’m in the water.

I agree, The latinas in TX are hotter, but crazier too!

Ben, I am a “fiscal conservative.” But also an outdoors-men and against fraud, so not a Republican, nor a Dem.

Fixt.

Ben, I am a “fiscal conservative.” clown.

Brazil ghetto, DC ghetto. It’s all good right LolaCado?

“We’ve posted entire states showing falling prices YoY Rental_Fraud.”

Which state(s) would that/those be?

3 of your 4 zillow links today are for single zip codes.

The 4th is for an area that comprises 10k people.

And prices are falling YoY in every one of them.

Your point?

My point is that if prices falling was so common, you wouldn’t have to look so hard. You could simply choose, say, Chicago, or Los Angeles.

As you narrow it down to smaller and smaller areas, you have smaller and smaller sample sizes. If you know anything about statistics or analysis, you would know that the smaller the sample size, the greater the potential error, and the less robust the conclusion you can draw from the data.

Falling prices are common. Some areas they’re falling statewide.

Your point?

Which state(s) have falling prices statewide?

That’s data you should post. It is far more meaningful than the cherry picked zip codes.

You want a better picture of reality?

http://www.zillow.com/ca/home-values/

If you go to the graph right below the map, click on Median Sale Price. Then click on the link that says “Show Data Table”. The click on “Zip Codes”. This shows the year-on-year data for median sale price for many zip codes in California.

As you scan through the individual zip code data, it is pretty easy to see that, the vast majority show green, some red. Same story if you click Cities, Counties or Metros. The state as a whole is green.

So, any particular zip code that is pulled out to show prices falling is by far the exception, not the rule…cherry picked. And you can see the zip codes that he plucks out of the list…92780 (Tustin), 95060 (Santa Cruz) are two of the relatively few down zip codes in the long list.

You know exactly what States. It’s data we’ve already posted.

Spend 5 minutes with the data and take a look then report back.

I’ll give you a hint:

Connecticut (-4%)
Iowa (-3%)
Massachusetts (-5%)
West Virginia (-1%)

All year on year declines in median sale price for those states.

Oh, and that’s the only 4 states noted by Zillow (they don’t have data for 17, so it’s 4 out of 33). “Common” isn’t a word I would use to describe the phenomenon of statewide declines in median sales prices.

See? You can do it Rental_Fraud.

Yes, I too can cherry pick data. Just like you.

Falling prices statewide, falling prices city wide… it’s all falling prices R._Fraud.

San Diego, CA Sale Prices Crater 16% As Demand Plunges Statewide

http://www.zillow.com/san-diego-ca-92130/home-values/

You want a better picture of reality?

http:/ /www. zillow. com/ca/home-values/

That doesn’t cut it, as it is well-known that Zestimates™ are REIC-funded and biased.

“The median price of homes currently listed in 92130 is $985,000 while the median price of homes that sold is $769,850.”

Now we’re talking. It looks like ‘home values’ in 92130 are ($769,850/$985,000-1) X 100% = -21.8% below seller wishing prices.

“Zillow Home Value Index $896,100″

And the Zilldo Home Value Index was pulled out of somebody’s @$$.

What does Republicans controlling Congress have to do with oil prices on the world market? I somehow missed the memo that today is weird political-economic theory day.

The day Obama took office gas was about $1.75.
A year later it was $3.50.

Those Republicans and their oil price increases….GRRRRRR!!!

Link on Drudge about the US sending nuclear cruise missiles back to Europe. It is portrayed as clearly defensive and in a way it is. However, I think that it is a party admission that with the help of Saudi Arabia we are waging economic warfare on Russia and Russia may not stop with economic warfare as a response.

The day Obama took office gas was about $1.75.
A year later it was $3.50.

But the left says that occurred since he did such a great job restoring the economy. So I guess that fall back down to $2.50 is because he is doing a crappy job now?

Gas price under Bush went to $4.21 a gallon and was over $3.00 a gallon most of his last term in office.

The only reason gas was at $1.85 when President Obama took office is because of the economic crash which greatly reduced demand and the crash effected all countries not just the US.

The Bush Recession was deep!

All good valid questions.

The non-manipulated, non-seasonally adjusted number of jobs in November FELL by 270,000. The BLS added 600,000 jobs as an adjustment to achieve the headline grabbing result.

If you have an interest in this, you might want to look up why statistics are seasonally adjusted. You’d probably find that, if the BLS is adding in some months, then it’s subtracting in other months.

Yes under this administration adding just before elections and subtracting after elections and Christmas shopping season.

No, go look it up.

If the country has really added 8 million jobs since 2010, how could real median household income FALL by 2.3%?”

Let me take a guess on this one. Is it possible that a lot of those 8 million jobs were low-paying jobs?

Why would payroll tax receipts be flat with last year if millions of new jobs have been created?

Sep 26, 2014

One Good Sign the Economy Is Staying Strong: Your Payroll Tax Withholdings

The U.S. economy grew at a 4.6% annual rate in the second quarter, according to the latest report from the Commerce Department. But leaves are turning brown now and this morning’s report describes what happened from April to June. How has the overall economy performed since then?

Here’s some evidence the strength has continued.

One gauge of economic activity goes all the way through this week: payroll tax withholdings. Every day the U.S. Treasury reports the amount of revenue received from withholdings. This creates a handy, real-time gauge of the economy because the tax payment is typically collected from each paycheck. When people get raises, payroll-tax revenue rises the moment an increase goes into effect (and, of course, vice versa).

“If you can figure out a way to correctly interpret the data, it’s never going to get revised and it’s real because nobody pays this tax on income that wasn’t earned,” said Joseph LaVorgna, chief U.S. economist at Deutsche Bank. Mr. LaVorgna takes the 60-day moving average of payroll tax receipts, averaging roughly a quarter’s worth of revenue, and compares it to the same period from a year earlier.

That method shows payroll taxes are bringing in about 5% more revenue than a year ago. Over time this data has often done a decent job of tracking nominal GDP, especially when not distorted by changes in the tax code. In the recession, withholdings fell faster than GDP, but they subsequently bounced upward more quickly.

http://blogs.wsj.com/economics/2014/09/26/one-good-sign-the-economy-is-staying-strong-your-payroll-tax-withholdings/

Well, for one thing, Ben Bernanke is a Republican who was appointed under GWB.

Reappointed by Obama that is a totally lame defense of your hero.

“Reappointed by Obama that is a totally lame defense of your hero.”

Your comments are lame and incoherent. Welcome back to the HBB!

“Your comments are lame and incoherent. Welcome back to the HBB!”

It’s unfortunate this diarrhea of the mouth has returned to the blog. It really makes for a worse user experience.

The concern here is that the low prices the people can charge by avoiding taxes and regulations will become a “new normal.” Eventually the only way some people can afford a hotel room will be to stay with a stranger in an unregulated environment.

The libertarians will cheer this on as less government interference and more free-market — hey, I pays my money and I rolls my dice, I can take care of myself. But the lib in me doesn’t like the idea making basic safety a luxury item accessible to only part of the population. That’s how things were in the Wild West, and how they are in third-world countries now.

It’s a similar situation with Uber. While I think Uber will be valuable in breaking a taxi monopoly run amok, there is a definite danger of predators using Uber to prey on poor people who can’t afford a registered taxi.

I hope uber puts the crooked taxis out of business. they have been gouging people for years. Yes I will sleep on your couch for 20 bucks and a six pack.

What happens after people use Uber a few times, find a few drivers or passengers they can trust, and then simply continue sharing using direct talk, text, and email, without bothering to use Uber any longer because the government (rightly or wrongly) makes it too cumbersome?

Services like Uber and Lyft don’t need regulations - the technology makes them self regulating.

Drivers and riders rate each other. If a driver drops below a certain rating, they are kicked off the service. For riders, it behooves them to behave because if they get too low of a rating, then drivers will be less inclined to pick them up.

All transactions are by debit card, so no there are no shady drivers or playing with the meter refusing to take cards and demanding cash to skim money

The route is tracked and it is known which driver is with which passenger and where. If the driver attempted to do anything to a passenger it would be super easy to track down and prosecute so it’s highly unlikely they would try anything.

These services voluntarily run background checks on the drivers because having bad or dangerous drivers would hurt their reputation and kill their business.

The government is just angry because they’re not needed anymore and the lack of their precious million dollar cab medallions would eat in to their coffers.

You know what… those of us in our 20s and 30s (20s especially) are struggling. There will be hell to pay if the state tries to take away the sharing economy as this is allows us to get by.

For riders, it behooves them to behave because if they get too low of a rating, then drivers will be less inclined to pick them up.

You know what… those of us in our 20s and 30s (20s especially) are struggling. There will be hell to pay if the state tries to take away the sharing economy as this is what allows us to get by.

This is EXACTLY what I was afraid of. Expenses go up such that people like CHE can only afford the cheapest stuff. Basic safety is now a luxury that CHE can’t afford.

I think it’s pretty funny that you think “government isn’t needed anymore.” If some shady Uber driver picks you up and cuts off a few limbs or worse, your family will at least be comforted in knowing that the driver may or may not go out of business from bad word-of-mouth.

“government isn’t needed anymore.”

The governments have done so well that a 5 mile trip will cost you 20 bucks.

“The governments have done so well that a 5 mile trip will cost you 20 bucks.”

Yeah, taxi’s no longer make much sense.

Just like we need the government (incl. the FED) to artificially prop up housing prices so people in the 20’s and 30’s can never buy. The situation will correct itself, one way or the other.

“The deficit number has been artificially lowered by nothing other than accounting entry hocus pocus. The Federal Reserve increasing its balance sheet to $4 trillion out of thin air creates approximately $80 billion of phantom interest profits that are paid to the Treasury. Why don’t they increase their balance sheet to $40 trillion and eliminate deficits all together?”

Maybe that’s how we get our inflation target of 2%. LOL

But isn’t the real question, how do we end the ability of governments to establish monopolies?”

Realtor’s amazing they are still in business. All that money. I don’t get it ???

But isn’t the real question, how do we end the ability of governments to establish monopolies?”

Yes. We went from needed regulations to monopoly with taxis. The buying of medallions for a hundred thousand dollars to enrich governments and create monopolies is not acceptable.
However, word of mouth is a great tool for minor problems but not to prevent rapes etc., I think it is important to prevent the first rape. Requiring a basic background check before being allowed to participate in uber is not excessive regulation. That said, the capture of regulators is a problem in all regulatory areas. I think Uber has done a service by shining the light on overregulation. Government needs to create a level playing field and they need to operate in a manner that protects the public if they are running a public service.

At the local level, most certainly. Show me someone who owns a medallion in Chicago, and I’ll show you someone who is a brother-in-law / cousin / son / daughter of a city councilman, mayor, union boss, etc

shuddp, slith

Dude, just go away.

Am I confusing you with the facts? I know ignorance is just bliss, you can turn to MSNBC if facts hurt your head.

No, Blue had it exactly right. Bullish except for the debt encumbered part of the economy.

Considering that debt encumbered part is rather large these days, yes there will be unintended consequences, many of those with a wide reach. But they have to happen in any event, now’s as good a time as any.

A lot of crazy commentary out there at the moment wrt oil prices, some of it from people whose opinions I respect and place a lot of weight on. But not a single one of them that I know predicted or even hinted at the possibility of the current crash.

Ben quite clearly stated that a-dan’s China GDP posts would be deleted. There was a spate of such posts from a-dan yesterday and they weren’t deleted (yet?). So I don’t know what’s going on.

If someone can explain to me where the oil to fuel the world is going to come from, I will agree with you. And no, I will not accept an answer of green energy since that was not even competitive with $100 a barrel oil.

BTW an excerpt from today’s China Daily which shows that anyone with money has no problem getting a green card, there is no need to loosen legal immigration rules:

In Vermont, Chinese immigrants provided most of the $52 million for the Mount Snow ski resort. In California, they are providing funds for the development of the 775-acre San Francisco Shipyard. And in New York City, 1,200 Chinese families paid for the $600 million foundation for the city’s biggest real estate project.

In those areas and elsewhere in the country, Chinese immigrants are using the EB-5 investor program of putting up money in exchange for a US visa.

The EB-5 program is run by the US Citizenship and Immigration Services (USCIS). With a minimum of $1 million — or $500,000 in low employment or rural areas — an EB-5 investor’s project must create or preserve at least 10 full-time jobs. In return, the investor is eligible for a green card for permanent US residency.

In West Dover, Vermont, the money was raised through the EB-5 program to build a 120-million-gallon water storage pond for snow making and a new 36,000-square-foot lodge.

The Mount Snow offering came under the auspices of the state of Vermont EB-5 Regional Center, a designated regional center of USCIS that is part of the Vermont Agency of Commerce and Development. The project, approved earlier this year and scheduled to begin in 2015, will result in the creation of 1,267 jobs.

P.S. The drop is good for countries such as China and India, that are major importers of oil and have not expended vast amounts of money to develop unconventional oil but not for the U.S.

Ben quite clearly stated that a-dan’s China GDP posts would be deleted. There was a spate of such posts from a-dan yesterday and they weren’t deleted (yet?). So I don’t know what’s going on.

No, he did not. I am glad I am not the only one that people like you misquote. He said maybe he should delete such posts. Which he had the right to do and I had the right not to post at all. Nuance is often lost on this board.

“Why would payroll tax receipts be flat with last year if millions of new jobs have been created?”

Average break-even point for US shale projects is about $80/bl. But many are below that, Bakken is $67, Eagle Ford a few bucks less, to name two major formations. Some are profitable below $50, only a handful are on-line with break-even points at or above $100/bl.

Do you think people go into business to break even? Many of these shale producers are deep in debt and need to make profits to service that debt. They cannot afford to keep drilling even if the price is above break even.

What does it matter? Oil and fuel prices are cratering.

Deflation. It’s your wallets best friend.

“drop is good for countries such as China…”

You have your cart before your horse there. The fiasco in oil is due to what is happening in China, not the other way around. They are also the most vulnerable country on the planet to the whiplash of falling prices, because they are the biggest debt donkey.

Yes, buy a big F-350 to drive to the mall. I promise gasoline prices will stay down.(not).

“They cannot afford to keep drilling even if the price…”

LOL. They cannot afford to keep drilling unless they get more cheap credit, regardless of the price.

And none of it matters if global GDP is way overstated, the debt cycle is near or past it’s peak, and global oil demand is now cratering.

They are also the most vulnerable country on the planet to the whiplash of falling prices, because they are the biggest debt donkey.

Blue, go the U.S. Debt Clock on the internet. Now click on the world debt clock. China’s public debt is about 17% of its GDP and dropping, you can actually see the counter move. The U.S. public debt is around 77% and it is still moving up, albeit much slower than past years. China has ample room to increase its public debt to keep its economy moving. It can and is increasing its defense spending by 12% a year, we are going to wish they kept building houses.

“Do you think people go into business to break even?”

No, but I know that break-even points are how you determine profitability, so that’s the metric conventionally used. Since you were stating in one of your sixty posts today that there was very little oil in the world that could be profitably extracted at $100, I’d though I’d point out that you were wrong, at least concerning most US shale projects.

Can you imagine how China has had the biggest credit expansion on the planet without it registering on your debt clock animation?

Since you were stating in one of your sixty posts today that there was very little oil in the world that could be profitably extracted at $100, I’d though I’d point out that you were wrong, at least concerning most US shale projects.

Once again as the left on this board loves to do, you misquoted me. I said there was plenty of unconventional oil at $100 a barrel. I did not say there was very little oil at less than $100, there is a big difference between the two statements. However, there is not enough oil that can extracted at today’s prices or even $80 a barrel to meet the needs of the world’s economy and going forward $100 a barrel is a reasonable price and the Saudi’s had said before they decided to help the U.S. wage economic warfare.

BTW, the major oil companies are very conservative in their investments. If oil is selling for $80, Exxon is probably going to only approve projects that break even at $50 to meet its high hurdle rate.

“Since you were stating in one of your sixty posts today…”

Mr. Black Pot, meet Mr. Black Kettle.

“Exxon is probably…”

That’s not true either dan.

Yes it is, I happen to be friends with someone that made such decisions for Exxon in the 1980s and he tells me nothing has changed.

“dannyboy is back”

dannyboy being back is positively bullish for growth in total HBB posts per day.

It’s not true dan. I was one of those guys. I sat in those meetings and took part in the investment decisions. They were ordinary extrapolator from here to the moon kind of guys.

Don’t look now, but oil and Wall Street are diverging today, with the stock market heading back towards record highs and oil now below $60/bbl.

I can’t wait to visit the Costco gasoline station this weekend!

A-Dan, are you really this stupid? I know what Ben said.
Please explain to me what I misquoted.

=================
Comment by Ben Jones
2014-08-10 08:01:47
‘China has just about doubled its GDP ‘

From now on, any post you make that has China and GDP in it is getting deleted on this blog.
=================

http://thehousingbubbleblog.com/?p=8541

Change of plan:

He has no one to blame but himself; he was hoisted by his own petard.

http://en.wiktionary.org/wiki/hoist_by_one%27s_own_petard

Positively bearish for D-O-D increase in total HBB posts.

Fine. I did remember that one wrong. But my posts were not deleted and my prediction of around 7% growth in China is more valid now than when I made the prediction. And China is no longer claiming 7.5% growth, and for the last few months they have been claiming around 7% so I am more accurate than the Chinese government. The big picture is more important than whether I correctly remembered whether Ben say may delete or will delete.

The side that needs to censor facts, has lost the debate.

Side? Anyway, anything too repetitive and off topic gets old. I once banned a guy for constantly going on about dollar cost averaging stocks. It would be 30 or 40 a day. I still don’t know what the heck he thought he was accomplishing.

I respect your posting the comment. However, as I said in the posts before I stop posting, I think the China story shows how GDP can be held up without artificially supporting housing. It was not essential to the national interest to keep housing prices at or near bubble prices. Ironically, it is China that has proven that by maintaining around 7% growth while it has allowed housing to shrink in importance. Even though housing had become an important mechanism to increase growth, they have found other ways to support growth. For example, the money used by the U.S. for first time home owner credits could have been used for roads and bridges. Supporting housing was essential to the U.S. major banks not the economy as a whole.

By the way whatever happened to PEAK OIL? Just a few years ago I was told by very smart liberals that we’d run out of oil in a few years. Now we’re debating if having lots of cheap oil is a good thing or a bad thing.

And on a totally unrelated note, the same PEAK OIL people are convinced the earth will get so hot that we’ll all die. Weird, huh?

“I am more accurate than the Chinese government”

He may have just found his epitaph:

Here lies Albuquerquedan, more accurate then the Chinese government.

‘I think the China story shows how GDP can be held up without artificially supporting housing’

They are freaking out and trying everything to get people to buy houses in China. It isn’t working.

“Here lies Albuquerquedan”

Lies are eventually exposed. GDP is a banker’s metric. It counts loans as “product”. There will be many disclaimers as “product” contracts. Adan will say that GDP doesn’t matter sooner or later, just my prediction.

“Here lies AbqShill.”

That’s a complete sentence.

“I did remember that one wrong. But my posts were not deleted and my prediction of around 7% growth in China is more valid now than when I made the prediction.”

You predicted 7.5% GDP growth in China forever. And a Romney win, based on Rasmussen poll results.

Too bad some of us around here have long enough memories to point out your revisionist posts.

“Adan will say that GDP doesn’t matter sooner or later, just my prediction.”

Next step in the progression:

But my posts were not deleted and my prediction of around 7% 6.5% growth in China is more valid now than when I made the prediction.

“By the way whatever happened to PEAK OIL?”

Hopefully the PEAK OIL crowd moved on somewhere else from the HBB. I don’t recall them being libruhls, though I do recall their posts being inane.

“You have your cart before your horse there. The fiasco in oil is due to what is happening in China, not the other way around.”

Excellent point. But good luck trying to convince gloopy with reason!

Damn you, Sam!! Shut up and drink your beer.

What kind are you buying? The ones I buy look great.

Can I be your adult foster child?

Damnit, beat me to it. Where do I apply??

And how can you tell they are telling you the truth?

A parasite or worker? Pol Pot would look at their hands.

It could be that he reads here at hbb.

Stockman nailed it.

“Then there is balance sheet fraud. After the 2008 Crash, the regulators suspended accounting standards that required the banks to price their assets at market-based values.

What is good beat down worth? A little strange in your placement of that comment. But I agree, it was that decision that allowed many banks to avoid foreclosures until the Fed could manipulate houses higher.

“They think they know that people would be better off spending their money rather than saving it… that prices should be rising not falling… and that, by propping up the price of financial assets with credit easing, they will cause real growth and real prosperity.”

She’s the real president and a communist.