The Housing Bubble

Living in a rental will never feel like a real home.

When Comrade Pelosi’s Democrat Permanent Supermajority is installed, every “victim” including the ever-growing millions of “disabled” will be entitled to “fairness” in the form of involuntary wealth transfer from the productive.

Forward, Free Sh!t Army! Our glorious collectivist future on the globalist corporate-state plantation awaits!

http://www.telegraph.co.uk/news/worldnews/europe/eu/11300793/EU-court-rules-that-fatness-can-constitute-a-disability.html

“patient”

Talked to a new co-worker this week. Single, early 30’s. He recently toyed about with buying a house — even got a Realtor and looked at a few. Then he realized his heart wasn’t in it and that he doesn’t really want to take care of a structure or yard. He has little interest in DIY or hiring contractors. (Around here, any SFH within a decent commute is at least 30-40 years old and needs rehab of some sort.)

He already knows enough not to buy a condo, but I piled on that condo fees go up like rent does, and 2-bed floating boxes of air are harder to sell than 3-bed SFHs with yard.

Instead, he signed a lease for a one-bed apartment.
Advantage: he’s in an older high-rise, so his utilities and internet are included.
Advantage: he’s on a Metro stop.
Disadvantage: monthly rent on his 1/1 is only $150/month less than the PITI on my 3/2. It’s a good rate for this area, but he’s not saving much versus paying PITI. His real advantage is in saving on utilities, internet, and maintenance.
Disadvantage: he got that good rate by signing an 18-month lease with a no-break clause. So he has no mobility, but he doesn’t seem to need to it.

In my view, for his age, it’s a wash. I told him: good job dude, don’t buy if your only reason is for the checking account. Plenty of time to buy later if you want to. (FWIW, years ago when I was his age, I didn’t want to take care of a house either, and made the same decision not to buy.)

The fun part — while we were talking about this, he got a bug-bug call from his (former) realtor. They won’t leave him alone. I told him that realtors are really hurting for end consumers, since they didn’t make a commission on all those bubblet investor cash buys.

http://www.theburningplatform.com/2014/12/15/pigmen-win-again/

“The real owners are the big wealthy business interests that control things and make all the important decisions. Forget the politicians, they’re an irrelevancy. The politicians are put there to give you the idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own and control the corporations. They’ve long since bought and paid for the Senate, the Congress, the statehouses, the city halls. They’ve got the judges in their back pockets. And they own all the big media companies, so that they control just about all of the news and information you hear. They’ve got you by the balls. They spend billions of dollars every year lobbying ­ lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else.” - George Carlin.

“when stocks can stay up on their own “

The Big Winner in the Rental Home Shortage: Wall Street

By John Gittelsohn and Heather Perlberg
Dec 19, 2014 12:01 AM ET

Corporate landlords are benefiting from the worst U.S. rental-housing shortage in more than a decade as construction trails demand and more Americans opt to lease rather than buy.

There’s an undersupply of single-family houses and apartments to rent for the first time since 2001, according to an analysis by Frank Nothaft, chief economist at mortgage buyer Freddie Mac, based on available inventory and historic vacancy rates. The deficit in the third quarter was about 350,000, the most in records dating back 14 years.

The shortage is giving the upper hand to institutional investors who spent more than $25 billion since 2012 buying single-family homes to rent. While the market for apartments has been in favor of landlords for five years, owners of houses are now able to increase rents and reduce turnover to boost profits.

http://www.bloomberg.com/…/rental-housing-shortage-gives-boon-to-corporate-landlords.html - 138k -

How about that stock market? It must be year-end bonus season on Wall Street.

The Feeding Begins: Foreign Bankers Descend on Ukraine

December 18, 2014 (F. William Engdahl - NEO) -

If it were not for the fact that the lives of some 45 million people are at stake, Ukrainian national politics could be laughed off as a very sick joke. Any pretenses that the October national elections would bring a semblance of genuine democracy of the sort thousands of ordinary Ukrainians demonstrated for on Maidan Square just one year ago vanished with the announcement by Victoria Nuland’s darling Prime Minister, “Yat” Yatsenyuk, of his new cabinet.

The US-picked Ukraine President, billionaire oligarch Petro Poroshenko called “snap” elections at the end of August for October 26. He did so to make sure genuine opposition to his regime of murderers, gangsters and in some cases outright Nazis would be able to push an unprepared genuine opposition out of the Verkhovna Rada or Parliament. Because the parliament had significant opposition parties to the US-engineered February 22 coup d’etat, they had blocked many key pieces of legislation that the Western vultures were demanding, from changing key land ownership laws to privatization of precious state assets. By law, the old parliament would have sat until its five year term ended in October, 2017. That was clearly too long for State Department neo-con Ukraine puppet-mistress Victoria Nuland and her backers in Washington.

Now, with a new parliament that is controlled by the Petro Poroshenko bloc as largest party and the boyish-looking former Prime Minister Arseniy Yatsenyuk, who is also new Prime Minister as head of the second largest party, the way was clear to get on with the rape of Ukraine. What shocked some is the blatant foreign takeover that followed, like a Wall Street vulture fund raid on a distressed debtor country of the Third World.

landdestroyer.blogspot.com/2014/12/the-feeding-begins-foreign-bankers.html - 130k -

Climate change: Beavers boost emissions with 800 million kg of methane every year

By Hannah Osborne
December 16, 2014 17:08 GMT

More research on the Beaver (1957–1963)

[June has prepared a lovely dinner of barbecued pork ribs]

Ward Cleaver: Well, you boys are very quiet tonight. What are you thinking about?

Theodore “Beaver” Cleaver: I was just thinkin’ what I’d do if I was a pig eatin’ peoples ribs.

June Cleaver: Beaver, please.

‘Wikileaks on Thursday has made public a never-before-seen internal review conducted by the U.S. Central Intelligence Agency that looked at the agency’s drone and targeted assassination programs in places like Afghanistan, Pakistan, Yemen, Somalia, and elsewhere.’

‘The agency’s own analysis, conducted in 2009, found that its clandestine drone and assassination program was likely to produce counterproductive outcomes, including strengthening the very “extremist groups” it was allegedly designed to destroy.’

‘”The potential negative effect of HLT operations,” the report states, “include increasing the level of insurgent support […], strengthening an armed group’s bonds with the population, radicalizing an insurgent group’s remaining leaders, creating a vacuum into which more radical groups can enter, and escalating or de-escalating a conflict in ways that favor the insurgents.”

‘Wikileaks points out that this internal prediction “has been proven right” in the years since the internal review was conducted near the outset of President Obama’s first term. And despite those internal warnings—which have been loudly shared by human rights and foreign policy experts critical of the CIA’s drone and assassination programs—Wikileaks also notes that after the internal review was prepared, “US drone strike killings rose to an all-time high.”

‘Reached by the Washington Post on Thursday for response, CIA spokesperson Kali J. Caldwell said the agency would not comment “on the authenticity or content of purported stolen intelligence documents.”

The WTO finds that the US is cheating on trade with China, we are imposing illegal tariffs. That is why we would have major problems with trying to impose a tariff on oil.

http://europe.chinadaily.com.cn/world/2014-12/19/content_19121063.htm

hey bartendar, can u pour me up a cosby for my friend.

BTW, I posted the growth in NG in China yesterday, here are the numbers for wind. Solar is showing similar growth. Many on this board want to blame the drop in coal use solely on a reduced rate of economic growth, but that is a small part of what is going on. China is moving away from coal for many reasons, environmental, wanting to reduce imports, the fact that China is rapidly running out of coal. That is another reason why Obama’s “deal” with China was such a joke. We agree to forfeit all the advantages of our abundant resources and they agree to do what they are already doing:

http://europe.chinadaily.com.cn/business/2014-10/22/content_18786120.htm

Comment by Rental Watch
2014-12-18 06:08:46

This is what is causing the “disaster”: “Inventory still lags demand in many markets,”

Not enough homes are on the market, which is driving prices higher.
………………………………………………………………………..

I don’t understand this comment.

I learned in high school economics that there is a difference between “increase in demand” and “increase in quantity demanded.”

When workers descend on, say, North Dakota, is that an increase in demand? Does it matter that they moved from Florida?

When 100,000 new immigrants move to California next year, is that an increase in demand?

Warmist Warming Friday

http://www.bloombergview.com/interactives/climate-change-in-perspective/

Lead follow or get out of the way. It’s good to see a few starting to grasp it.

I am working on a Climate change documentary in hopes of getting a federal grant for more research.

So far all I have is the intro.

http://www.youtube.com/watch?v=jQkG6yEYxx4 - 199k -

As I said yesterday, with the WTI contract expiring today volatility was to be expected. We are now up over $2 a barrel which is more than we fell yesterday.

It is all OK as unions are the all time top political money contributors and give 99% to democrats.

What is a little sabotage, violence and extortion when it is for the children…?

—————————-

Union Leaders Plead Guilty to Arson, Violence and Extortion
Breitbart | 12/19/2014 | DJ Biers

Three more members of Ironworkers Local 401 in Philadelphia pleaded guilty Tuesday to charges of conspiracy, extortion, and racketeering in an ongoing RICO case against the labor union. They join eight others who have pleaded guilty in recent months to charges related to arson, sabotage, and violent intimidation of contractors who used non-union labor.

The union’s business agents would visit foremen and threaten them with assault and sabotage if they did not agree to hire 401 members, prosecutors claim, although often such workers “often performed little or no actual work” and were paid “merely to prevent further acts of sabotage.” If the foreman did not concede, union members would use a series of tactics, from picketing to physically barring workers and materials from entering the site, to increase the pressure. If this did not work, things would escalate to violence and vandalism: “actions included assaulting non-union employees with baseball bats, slashing the tires of vehicles, smashing vehicles with crow bars, cutting and changing the locks on construction sites, filling the locks with superglue, damaging construction equipment, [and] stealing construction materials.”

If the contractors still resisted, more severe sabotage – what members referred to as “night work” – is alleged to have followed, including setting fire to the site, destroying machinery, and “using an acetylene torch … to cut through the steel support columns of the building.”

Your New Years resolution for 2015: Get out of debt ASAP!

Interesting information from oil and gas journal which confirms my cost estimates and the fact that these oil prices will not last long:

12/12/2014
Rachael Seeley, Editor

Bakken shale production set another record in August, but weakening crude prices and flaring reduction efforts threatened to temper production growth.

The state produced 1.13 million b/d of oil and 1.3 bcfd of gas during the month, yielding a production growth rate of 2%. The growth rate was 4% in August 2012 and August 2013, said Lynn Helms, director of North Dakota Mineral Resources.

Helms addressed a monthly webinar hosted by the North Dakota Industrial Commission on Oct. 15.

Completions were delayed by at least two operators to comply with the state’s first mandatory flaring reduction target. By Oct. 1, producers were required to capture 74% of their natural gas production or face mandatory production curtailments in January.

“The number one impact there was gas capture plans. I’ve talked to two different operators in the past week, and both of them had postponed anywhere from 20 to 40 completions because they want to arrive at that 74% [target],” Helms said.

Weakening crude prices were also cited. The average price of North Dakota Sweet (NDS) crude was $78.46/bbl in August, down from $86.20/bbl in July, according to pricing information from Flint Hills Resources. On the day of the webinar, the price of NDS fell to $66.25/bbl.

Weakening crude prices contrasted with rising operating costs. In testimony to the state, producers have cited a year-over-year operating cost increase of 36%.

“The average operating cost for a Bakken-Three Forks well is now just under $15,000/month,” Helms said. If weak crude prices persist, Helms expects producers will seek to reduce operating costs and may then begin to lay down rigs.

At crude prices below $70/bbl, drilling in Burke, Bowman, and Slope counties is uneconomic. “We’ve taken a look at the operating costs on a county by county basis, and we have three counties that-right now, at less than $70/bbl-are below break-even,” Helms said.

These counties have higher costs than those in the Bakken core due to relatively low initial production rates, high water disposal costs, and a reliance on diesel power generation.

“The main factor is the initial production rate,” Helms said. “With Bakken and Three Forks wells, the big payout period is in that first 1-2 years, so that initial production rate is a huge driver [of profitability].”

Cray cray tur.

Latest rig count just out and North America is down 58 rigs, more than double last weeks decline. The business is shutting down at these levels both here and ironically this week at least even more in Canada.

Automakers, especially in Europe, are getting reamed by the collapse of the ruble.

http://wolfstreet.com/2014/12/19/global-automakers-get-blasted-by-ruble-crash/

http://en.wikipedia.org/wiki/Automotive_industry_in_Russia

when talking about resource rich economies, economists often talk about the Dutch disease. And what it refers to as one part of your economy doing so well it destroys the rest of your economy. Oil producing countries often have overvalued currencies which makes it hard to produce anything else. Russia has suffered from this and it has hurt its manufacturing companies. The lower ruble is going to help Russia revive them and actually create more employment opportunities.

John Mauldin’s stuff

1. In recent years, America’s oil & gas boom has added $300–$400 billion annually to the economy – without this contribution, GDP growth would have been negative and the nation would have continued to be in recession.
2. America’s hydrocarbon revolution and its associated job creation are almost entirely the result of drilling & production by more than 20,000 small and midsize businesses, not a handful of “Big Oil” companies. In fact, the typical firm in the oil & gas industry employs fewer than 15 people. [We typically don’t think of the oil business as the place where small businesses are created, but for those of us who have been around the oil patch, we all know that it is. That tendency is becoming even more pronounced as the drilling process becomes more complicated and the need for specialists keeps rising. – John]
3. The shale oil & gas revolution has been the nation’s biggest single creator of solid, middle-class jobs – throughout the economy, from construction to services to information technology.
4. Overall, nearly 1 million Americans work directly in the oil & gas industry, and a total of 10 million jobs are associated with that industry.

more from JM

Oil in 2015
With all that as a backdrop, let us return to our original task, which was to think about what will impact the US and global economies in 2015. I’ve been talking to friends and contacts who are serious players in the energy-production sector. This is my takeaway.
The oil-rig count is already dropping, and it will continue to drop as long as oil stays below $60. That said, however, there is the real possibility that oil production in the United States will actually rise in 2015 because of projects already in the works. If you have already spent (or committed to spend) 30 or 40% of the cost of a well, you’re probably going to go ahead and finish that well. There’s enough work in the pipeline (pardon the pun) that drilling and production are not going to fall off a cliff next quarter. But by the close of 2015 we will see a significant reduction in drilling.
Given present supply and demand characteristics, oil in the $40 range is entirely plausible. It may not stay down there for all that long (in the grand scheme of things), but it will reduce the likelihood that loans of the nature and size that were extended the last few years will be made in the future. Which is entirely the purpose of the Saudis’ refusing to reduce their own production. A side benefit to them (and the rest of the world) is that they also hurt Russia and Iran.
Employment associated with energy production is going to fall over the course of next year. It’s not all bad news, though. Employment that benefits from lower energy prices is likely to remain stable or even rise. Think chemical companies that use natural gas as an input as an example.
I am, however, at a loss to think of what could replace the jobs and GDP growth that the energy complex has recently created. Certainly, reduced production is going to impact capital expenditures. This all leads one to begin thinking about a much softer economy in the US in 2015.

Bellevue, WA Sale Prices Sink 5% YoY; Vacancies Rise As Demand Plummets

http://www.zillow.com/bellevue-wa-98007/home-values/

I strongly disagree with Sony’s decision. However, Obama is just shifting the blame here. As president he needs to accept responsibility for not protecting an American company from an attack from a foreign country. The buck stops at the president’s office as a Harry Truman said. Why have we given up our privacy to the NSA, if they cannot see and prevent such a massive attack by a foreign government.

http://money.cnn.com/2014/12/19/media/sony-executive-michael-lynton-responds-to-president-obama/index.html

The sh*t is about to hit the fan in Iraq an Iraqi base is about to fall to ISIS and there are Americans located at the base.

http://www.bbc.co.uk/news/world-middle-east-30492064

Region VIII checking in

http://www.picpaste.com/tmp_IMG_20141219_165723_456-1331497514-f3phAo7a.jpg

anyone bought any eggs lately in ca? wtf guys

And just a reminder for all of you traveling this holiday season

New York Daily News - Where Ebola patient Dr. Craig Spencer went in the city: a timeline

http://www.nydailynews.com/new-york/ebola-patient-dr-craig-spencer-city-timeline-article-1.1986708

Don’t sneeze on your nearby travelers, and don’t put your finger inside your nose or your butthole and go touching other places inside the airplane

phony scandals