December 25, 2014

Bits Bucket for December 25, 2014

Post off-topic ideas, links, and Craigslist finds here.

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Comment by Whac-A-Bubble™
2014-12-25 06:36:11

Is oil still sliding this Christmas morn?

Comment by Whac-A-Bubble™
2014-12-25 06:51:24

Sliding oil prices leave socialist Venezuela on brink of financial collapse
President Nicolas Maduro — the hand-picked successor to the late socialist Hugo Chavez — faces mounting international criticism for jailing opposition figures after months of street protests. (Associated Press) more >
By Guy Taylor - The Washington Times - Tuesday, December 23, 2014

The ongoing plunge in global oil prices is pushing Venezuela toward economic collapse just as President Nicolas Maduro — the hand-picked successor to the late socialist Hugo Chavez — faces mounting international criticism for jailing opposition figures after months of street protests.

Analysts say Mr. Maduro is acting out of desperation to send a threatening message to an opposition eager to seize on his own plummeting approval ratings. Polls put his approval ratings as low 24 percent amid reports that the Venezuelan has no serious strategy for tackling the nation’s more than 63 percent inflation rate and widespread shortages of consumer goods such as diapers, milk and laundry detergent.

Comment by azdude
2014-12-25 07:48:00

are lower oil prices good for walmart?

Comment by Oddfellow
2014-12-25 08:14:21

“pushing Venezuela toward economic collapse”

Are we sure Venezuela isn’t playing a masterful game of chess, like Russia?

Comment by Oddfellow
2014-12-25 08:30:47

Master statist Putin calls for (yet more) price controls, this time on Russia’s primary necessity, vodka.

“Since last year, the government-regulated minimum price of half a litre (17 oz) of vodka has increased by around 30% to 220 roubles ($4.10; £2.64), Reuters adds.”

bbc news

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Comment by Oddfellow
2014-12-25 08:35:16

Forgot the key sentence:

“Russian President Vladimir Putin has ordered his government to curb rising vodka prices.”

bbc news

Comment by Prime_Is_Contained
2014-12-25 11:44:33

“Russian President Vladimir Putin has ordered his government to curb rising vodka prices.”

Brilliant—give the appearance that you are _protecting_ joe6sixshots from the price rising, when you are actually the one responsible for the threatened raise.

Now what does that remind me of?

Comment by Oddfellow
2014-12-25 12:00:53

“Now what does that remind me of?”

Maybe another statist/strong leader, like this one?

Police in Turkey have arrested a 16-year-old student on charges of insulting President Recep Tayyip Erdogan, according to local media.

He was arrested on Wednesday after criticising the ruling AK Party during a speech at a student protest in the central Anatolian city of Konya.

The teenager could face up to four years in prison if found guilty.

Prime Minister Ahmet Davutoglu defended the arrest, saying the presidential office “needs to be shown respect”.

Turkey’s penal code makes it a crime to insult the president.

Comment by Oddfellow
2014-12-25 12:02:31

above quote is from BBC news

Comment by In Colorado
2014-12-25 10:09:48

Sliding oil prices leave socialist Venezuela on brink of financial collapse
President Nicolas Maduro — the hand-picked successor to the late socialist Hugo Chavez — faces mounting international criticism for jailing opposition figures after months of street protests

It’s much more effective to buy out the opposition than to engage it. In Mexico the PRI did that for 60 years. While South American nations would go through serial coupe d etats and military juntas Mexico was a Latin American bastion of stability.

Of course, you need money to do that. When Mexico went broke was when the hard left broke off from the PRI and formed the PRD, and came within a cat’s whisker of taking Mexico down commie blvd (It is widely believed that the PRI stole the 1988 election from the PRD).

Comment by Guillotine Renovator
2014-12-25 10:24:57

When you have all your eggs in one basket, and you set it on a wobbly table, you have nobody to blame but yourself.

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Comment by rms
2014-12-25 06:54:50

“Is oil still sliding this Christmas morn?”

STFU said Canada and Mexico. :)

Comment by Whac-A-Bubble™
2014-12-25 06:58:30

Oil Prices Slide on Surge in Supplies
U.S. Crude Supplies Unexpectedly Rise, Adding to Glut of Oil
By Timothy Puko
Updated Dec. 24, 2014 2:43 p.m. ET

Oil futures retreated Wednesday and auto fuels closed at multiyear lows after data showed an unexpected surge in U.S. crude supplies.

Oil producers added 7.3 million barrels in the week ended Dec. 19, the U.S. Energy Information Administration said Wednesday. The supply surge adds even more to a growing glut of oil that has already sparked an international showdown for market share and a nearly 50% decline in futures since June.

“The market is very fragile and…this is not going to help sentiment in the least,” said Andrew Lebow, a broker at investment bank Jefferies.

Comment by Whac-A-Bubble™
2014-12-25 07:00:06

Attribution: wsj dot com

Comment by azdude
2014-12-25 07:29:37

merry christmas bear pit?

Will it be another year of kicking tires in 2015?

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Comment by Housing Analyst
2014-12-25 09:18:37

Cheer up Poet and remember….. Deflation is your wallets best friend and positively bullish for the economy.

Comment by Guillotine Renovator
2014-12-25 10:28:51

“Oil producers added 7.3 million barrels in the week ended Dec. 19, the U.S. Energy Information Administration said Wednesday. The supply surge adds even more to a growing glut of oil that has already sparked an international showdown for market share and a nearly 50% decline in futures since June.”

Wait a minute, it was supposed to be paper barrels- Albuquerqueboy told us so!

Comment by Bill, just south of Irvine
2014-12-25 07:34:34

Happy holidays brother from another

Comment by azdude
2014-12-25 08:29:39

any value out there bill?

Comment by Bill, just south of Irvine
2014-12-25 09:35:48

Oil is getting close to a value. Physical bullion in a variety of PGMs, silver, gold are values. International stocks are still sky high but might crash before U.S. stock indices crash. Keep your limits refreshed.

I have had my order filled on GDXJ a nd m close to my limit buy on GDX. Have limit buys on HES, CVX, WFM, TM, and LUV. Of those five, I might get HES within the next four months, barring a big war outbreak beyond the current endless M.E. war.

Tangible assets outside Primary residences are important. Those I covered before.

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Comment by Ol'Bubba
2014-12-25 11:59:18

Are you hedging your gold with oatmeal futures?

Comment by Bill, just south of Irvine
2014-12-25 13:01:33

No but maybe that is a good idea!

Comment by Whac-A-Bubble™
2014-12-25 11:45:19

Merry Nonsectarian Nondenominational Nonsectarian Nonreligious Winter Solstice Celebration!

Comment by Prime_Is_Contained
2014-12-25 12:13:30

LOL… Your Mormon forebearers must be so proud. :-)

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Comment by Whac-A-Bubble™
2014-12-25 13:00:51

Lutheran not Mormon. Luther was one of history’s great religious rebels. Nietzsche and Kierkegard were of similar background.

Comment by Prime_Is_Contained
2014-12-25 14:20:18

Ah, my apologies, PB; I thought I remembered you mentioning LDS relatives at some point in the past. Perhaps I misremembered, or perhaps those are on your wife’s side of the family?

Comment by Whac-A-Bubble™
2014-12-25 23:56:21

No apology needed. I am the only non-LDS person in my immediate family, so you were on target.

Comment by rms
2014-12-25 13:04:42

Nonsectarian^2, cheating?

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Comment by Whac-A-Bubble™
2014-12-25 11:43:16

Middle East
Oil’s Swift Fall Raises Fortunes of U.S. Abroad
DEC. 24, 2014
Iranian oil workers Monday at a refinery south of Tehran. Facing a big budget hole, the government is offering to let men buy their way out of military service. Credit Vahid Salemi/Associated Press

BRUSSELS — A plunge in oil prices has sent tremors through the global political and economic order, setting off an abrupt shift in fortunes that has bolstered the interests of the United States and pushed several big oil-exporting nations — particularly those hostile to the West, like Russia, Iran and Venezuela — to the brink of financial crisis.

The nearly 50 percent decline in oil prices since June has had the most conspicuous impact on the Russian economy and President Vladimir V. Putin. The former finance minister Aleksei L. Kudrin, a longtime friend of Mr. Putin’s, warned this week of a “full-blown economic crisis” and called for better relations with Europe and the United States.

But the ripple effects are spreading much more broadly than that. The price plunge may also influence Iran’s deliberations over whether to agree to a deal on its nuclear program with the West; force the oil-rich nations of the Middle East to reassess their role in managing global supply; and give a boost to the economies of the biggest oil-consuming nations, notably the United States and China.

It might even have been a late factor in Cuba’s decision to seal a rapprochement with Washington.

After a precipitous drop, to less than $60 a barrel from around $115 a barrel in June, oil prices settled at a low level this week. Their fall, even if partly reversed, was so sharp and so quick as to unsettle plans and assumptions in many governments. That includes Mr. Putin’s apparent hope that Russia could weather Western sanctions over its intervention in Ukraine without serious economic harm, and Venezuela’s aspirations for continuing the free-spending policies of former President Hugo Chávez.

The price drop, said Edward N. Luttwak, a longtime Pentagon adviser and author of several books on geopolitical and economic strategy, “is knocking down America’s principal opponents without us even trying.” For Iran, which is estimated to be losing $1 billion a month because of the fall, it is as if Congress had passed the much tougher sanctions that the White House lobbied against, he said.

Iran has been hit so hard that its government, looking for ways to fill a widening hole in its budget, is offering young men the option of buying their way out of an obligatory two years of military service. “We are on the eve of a major crisis,” an Iranian economist, Hossein Raghfar, told the Etemaad newspaper on Sunday. “The government needs money badly.”

Venezuela, which has the world’s largest estimated oil reserves and has used them to position itself as a foil to American “imperialism,” received 95 percent of its export earnings from petroleum before prices fell. It is now having trouble paying for social projects at home and for a foreign policy rooted in oil-financed largess, including shipments of reduced-price petroleum to Cuba and elsewhere.

Amid worries on bond markets that Venezuela might default on its loans, President Nicolás Maduro, who was elected last year after the death of Mr. Chávez, has said the country will continue to pay its debts. But inflation in Venezuela is over 60 percent, there are shortages of many basic goods, and many experts believe the economy is in recession.

But the biggest casualty so far has probably been Russia, where energy revenue accounts for more than half of the government’s budget. Mr. Putin built up strong support by seeming to banish the economic turmoil that had afflicted the rule of his predecessor, Boris N. Yeltsin. Yet Russia was back on its heels last week, with the ruble going into such a steep dive that panicked Russians thronged shops to spend what they had.

“We’ve seen this movie before,” said Strobe Talbott, who was President Bill Clinton’s senior Russia adviser in the aftermath of the Soviet Union’s 1991 collapse and is now president of the Brookings Institution in Washington.

Russia’s troubles have rippled around the world, slashing bookings at ski resorts in Austria and spending on London real estate; spreading panic in neighboring Belarus, a close Russian ally; and even threatening to upend Russia’s Kontinental Hockey League, which pays players in rubles.

Venezuelans waited outside a market in Caracas in October to buy basic items like diapers and detergent. Their economy relies almost entirely on oil revenue. Credit Ariana Cubillos/Associated Press

“It is a big boost for the U.S. when three out of four of our active antagonists are seriously weakened, when their room for maneuver is seriously reduced,” Mr. Luttwak said, referring to Russia, Iran and Venezuela.

Comment by Raymond K Hessel
2014-12-25 07:17:13

A British chick I spent Christmas with back in the day turned me on to what is still my all-time favorite Christmas song: Bony M’s “Oh My Lord.” Merry Christmas, and don’t forget the reason for the season.

Comment by Blue Skye
2014-12-25 08:06:05

Awesome. Thanks and Merry Christmas!

Comment by scdave
2014-12-25 08:41:04

Thanks RKH…Never saw that before…Yes…Merry Christmas to all…

Comment by aNYCdj
2014-12-25 11:43:32

lets all add our Christmas song

Comment by Raymond K Hessel
2014-12-25 16:39:34

Here’s another one I like: one of Paul McCarthy’s more obscure songs based on the Christmas 1914 spontaneous truce between British and German troops facing each other across the trenches, to the rage of their genocidal high commands and the war profiteers.

Comment by palmetto
2014-12-25 07:35:07

Merry Christmas to Ben and HBB.

Comment by azdude
2014-12-25 09:13:14

” Right now McDonald’s has 14,267 locations in the United States, but payday lenders have more than 20,000.”

Comment by aNYCdj
2014-12-25 11:57:26

that’s very sad.. people are so broke and irresponsible they cant ask their parents/family for help anymore ….because they probably screwed them the last time they asked for a loan

Comment by rms
2014-12-25 13:09:55

“people are so broke and irresponsible they cant ask their parents/family for help anymore ….because they probably screwed them the last time they asked for a loan”

+1 You just described ghetto life.

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Comment by Bill, just south of Irvine
2014-12-25 07:49:11

Happy “whatever” celebrations and get-togethers with family and friends, local or remote! To all the HBB brothers and sisters

Comment by azdude
2014-12-25 08:25:18

does buying a house create wealth inequality?

Comment by Guillotine Renovator
2014-12-25 11:14:16

Yes. Those who mortgage their future by signing up for 30 years of debt on a depreciating wood box are often left penniless, and fall hopelessly behind financially to the likes of Bill, Wherever He Wants To Be.

Comment by Ben Jones
2014-12-25 08:36:19

‘No, North Korea Didn’t Hack Sony. The FBI and the President may claim that the Hermit Kingdom is to blame for the most high-profile network breach in forever. But almost all signs point in another direction.’

‘3. Blaming North Korea offers an easy way out for the many, many people who allowed this debacle to happen; from Sony Pictures management through to the security team that were defending Sony Picture’s network.’

‘4. You don’t need to be a conspiracy theorist to see that blaming North Korea is quite convenient for the FBI and the current U.S. administration. It’s the perfect excuse to push through whatever new, strong, cyber-laws they feel are appropriate, safe in the knowledge that an outraged public is fairly likely to support them.’

This is one of the strangest false flag deals ever. Almost from the start, experts have been shooting holes in the official story, but the media have run this thing as if it was a certainty. It’s no small matter. This week the President assured us it wasn’t an “act of war.” But he could have said it was. Bombers could have been launched and given the way wars are started these days, no one could have stopped him. I doubt there’s very many in DC who would have wanted to.

All this with some nuke brandishing nut-jobs in North Korea. Are the people in charge really this reckless?

We’re asked to believe a lot of whooie anymore. An airliner can just disappear. Another airliner fly’s over a war zone, get shot down, and we are surprised. Seven or ten thousand guys in pajamas can, in a couple weeks, take over most of a country the US invaded with 150,000 and fought for months to capture.

It reminds me of this:

‘The aide said that guys like me were ”in what we call the reality-based community,” which he defined as people who ”believe that solutions emerge from your judicious study of discernible reality.” I nodded and murmured something about enlightenment principles and empiricism. He cut me off. ”That’s not the way the world really works anymore,” he continued. ”We’re an empire now, and when we act, we create our own reality. And while you’re studying that reality — judiciously, as you will — we’ll act again, creating other new realities, which you can study too, and that’s how things will sort out. We’re history’s actors . . . and you, all of you, will be left to just study what we do.”

Comment by Michael Viking
2014-12-25 08:57:08

Seven or ten thousand guys in pajamas can, in a couple weeks, take over most of a country the US invaded with 150,000 and fought for months to capture.

I want to believe that if we weren’t squeamish and we had no qualms about beheading or crucifying anybody who looked at us funny or stepped out of line - essentially if we were just like the pajama guys - then we could have done it just as easily.

Perhaps we’ve specifically chosen rules of engagement to keep everything going as it is…?

Comment by Ben Jones
2014-12-25 09:18:56

‘if we weren’t squeamish’

You mean like this:

Come on, when this started the guys who were actually doing the fighting, the Sunni tribes, told their media that ISIS was a small contingent of the advancing militants. Less than 5%. But that got whooshed off into never-never land. This is a Sunni uprising. So why the false story? Look at the outcome. US troops and fighter aircraft in Iraq and Syria. Just what these guys wanted a year ago and got slapped down over.

This false reality stuff explains a lot of the housing bubble too. Posters here have said, “I can’t believe they reflated the bubble.” Jeebus, Bernanke said that’s what he was going to do. Sure, they’ll sit around and talk about how terrible those bad old days of subprime loans were, and in the same breath tell us higher house prices will save us all. Now we have Subprime Mel telling us we need to make sure everybody can get a house loan because, ta-da, houses cost so much. And “Affordable Housing” Yellen gets away with saying what poor people need is access to debt that gets them “asset’s.”

Comment by azdude
2014-12-25 09:30:07

the higher these asset prices go the more likely these folks will need a loan.

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Comment by Ben Jones
2014-12-25 09:54:27

‘For many New Yorkers, home ownership — whether co-op, condo or house — is the first step toward building wealth. And making that first home easier to finance can give families an important toehold in the middle class.’

‘That’s the great thing about Fannie Mae and Freddie Mac’s recent decision to underwrite mortgages with down payments of 3 percent for first-time home buyers.’

‘Previously these two guarantors of most of the nation’s mortgage debt bought only loans with at least 5 percent down. Now more hardworking families will get a shot at upward mobility.’

‘History also offers an encouraging precedent. When 3 percent loans were available in the past, says Fannie Mae, the default rate was essentially the same as for those with 5 percent down.’

Tell us, what is that default rate? And it may be, as 3 or 5% isn’t that much difference. As we know, defaults relate much more to high prices than terms. Oh, but here’s the kicker:

‘And expanding access to mortgages for people who can afford the monthly costs of ownership but don’t have a big pile of cash to put down — such as families burdened with college debt — should provide a small but timely boost for the sluggish housing market.’

Comment by azdude
2014-12-25 09:58:01

Do they have to document their income this time around?

Comment by Guillotine Renovator
2014-12-25 11:22:41

We need to get people some loans to start speculating in commodities, etc. Imagine if we could loan people money to short stocks, and then those stocks went up? Oh, the delicious profits!!!

Comment by Whac-A-Bubble™
2014-12-25 11:48:12

“Do they have to document their income this time around?”

For now, yes. Look for a push to weaken this requirement in a couple of years, after the effects of the current measures to loosen lending standards have worn off.

Comment by Housing Analyst
2014-12-25 12:56:40

Another shot of juice for a dying junkie.

Comment by Michael Viking
2014-12-25 10:26:04

You mean like this:

No. I don’t think that’s what I mean. That stuff is all done in secret. I mean when it’s in public and you finish by leaving the guy crucified in the center of town as a warning.

I mean when you go into a school and kill 100 children and the 5 fighters hiding there. I don’t mean when you have to quit fighting because there are kids in school or because the people retreated into a mosque or whatnot.

By showing me pics of Abu Ghraib are you really implying that America’s rules of engagement on the battlefield are the same as the pajama guys’ ?

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Comment by Ben Jones
2014-12-25 10:37:28

Those pics suggest the US isn’t squeamish about war. If you’ll blow up a wedding party to get one guy, what wouldn’t you do?

War is a rich mans terrorism and terrorism is a poor mans war. But where did ISIS come from? Who was funding it before it supposedly took a third of Iraq? Why did those Sunni tribal leaders ridicule the notion that a few thousand guys could take and hold a city of 1.5 million? Without a single helicopter, against an army of 300,000.

Oh, and they did this while fighting in Syria too. It’s like the Sony hack thing; makes no sense, except to use as a casus belli.

Comment by oxide
2014-12-25 12:41:04

Man, Obama must be Champion of the Psychic Universe when it comes to locating “wedding parties.” It seems like he’s hit dozens of ‘em so far. Why, one time Obama even hit a convoy when they were “on their way” to the wedding party! That’s some Grade A psychic power there. Too bad there wasn’t a wedding party on that missing plane.

Comment by Ben Jones
2014-12-25 12:56:53

Some say the drones have flown over parts of Pakistan and Yemen for so long, the children don’t know what being outside is like without the noise.

Comment by Prime_Is_Contained
2014-12-25 14:21:59

I don’t think they generally fly at an audible altitude…

Comment by Michael Viking
2014-12-25 14:28:00

Those pics suggest the US isn’t squeamish about war. If you’ll blow up a wedding party to get one guy, what wouldn’t you do?

Those pics suggest that there are animals in our military and government, just like there are animals all over the world. Sure these people aren’t squeamish. I’m talking about an open policy where this is the norm, not some secret practice. Blowing up wedding parties is also pretty secretive.

Barbarous things happen. The Pajama guys do it as a rule, not an exception. The Americans don’t do it as a rule.

How do you think things would be going if we prosecuted these wars the way the ancient Romans would have?

Comment by Ben Jones
2014-12-25 15:07:08

‘The Americans don’t do it as a rule’

When these guys were doing this same stuff to the Syrians, and our buddies in Saudi Arabia was paying for it, and the CIA was training them, it was just as wrong. But you didn’t hear much about it in the US press. And certainly not round the clock like now.

IMO war does this to people. Do you think those guards in these photos would have done this to someone eventually, if they hadn’t been sent to Iraq? Or were they more or less ordinary people? It’s as old as history that the enemy must be seen as less than human. As soon as you see that going on, you should think twice. It’s propaganda. And with war come lies. Lies about who did what and what interests are worth killing for and being killed. War is not a natural state. This country went a long time after Vietnam not getting up to much of it, and it was a very concerted effort that now has us engaged in several shooting battles all over the world and more on the way. I’m not going to get into some discussion of proper war or What Would Genghis Do? Because war is a racket and a destroyer of lives and souls. As modern people, we should know better.

Comment by Prime_Is_Contained
2014-12-25 15:31:58

Because war is a racket and a destroyer of lives and souls. As modern people, we should know better.

+infinity, Ben.

That’s my Christmas wish right there.

Comment by Whac-A-Bubble™
2014-12-25 23:58:59

Ben, sincere thanks for seeing the light through the fog of propaganda and sharing your vision with us.

Comment by Prime_Is_Contained
2014-12-25 12:11:34

Posters here have said, “I can’t believe they reflated the bubble.” Jeebus, Bernanke said that’s what he was going to do.

Ben, I believed Bernanke when he said that was what he was going to do; however, I was surprised by the fraction of the investing world and general populace that went _along_ with it.

I mistakenly thought once the housing bubble was broadly known to be a _bubble_ that folks would become much more hesitant to play along. I didn’t believe that bubble-think could be so quickly restored—and I still believe that mentality/sentiment is a key component of any bubble forming.

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Comment by Housing Analyst
2014-12-25 12:15:47

It just makes the fall all the deeper and broader.

Comment by Ben Jones
2014-12-25 12:23:33

‘that went _along_ with it’

There are reasons to believe it isn’t as wide spread as the media would like us to think. Ownership rates have fallen right through this boom. Mortgage origination’s at 30 year lows. It’s easy to say, house prices in Walla Walla are X. But if everybody tried to sell they sure wouldn’t get X. I characterized it as a mile wide and an inch deep. This is why the downturn might not result in a as much individual financial hardship as a few years ago. I hope this turns out to be the case.

Comment by Housing Analyst
2014-12-25 12:37:33

That might be true for the 2009-current runway foam. Excluding the herd of fools of the 1998-2008 vintage is an error. There is no escape for “______ is an investment” as it is all founded on an unprecedented credit bubble/mania.

Show me aggregate wages commensurate with current bubble priced ‘assets’ and I’ll be happy to go on a diet of crow.

Comment by Ben Jones
2014-12-25 13:02:53

The one guy I use as a bench mark for foreclosures called me the other day. He bought a house in 2006 in Flagstaff. He’s defaulted twice. Once for a year and they forgave that years payments. I assume he’s on HARP or HAMP. Over the years he’s told me of ups and downs. Getting busy in the construction biz, then it slowing down again. That he misses truck payments a lot, that sort of thing. Marital strain. Anyway, he tells me the other day he’s thinking about throwing in the towel, leaving Flagstaff and the house. All these years, he’s struggled with the payments he could never really afford. With 20/20 hindsight, he would have been better off to have walked away in 2007 or 2008. He’s got a lot of pride, I guess. I wonder how many like him are out there?

Comment by Housing Analyst
2014-12-25 13:04:41

“I wonder how many like him are out there?”

Like a religion, there are masses of them that will implode rather than cut their losses and admit defeat.

Comment by Prime_Is_Contained
2014-12-25 15:35:28

Ownership rates have fallen right through this boom. Mortgage origination’s at 30 year lows.

Both of those are excellent indicators, and both of them give me hope.

Combined, those two suggest that much of the demand of the last few years has not been “organic” demand—e.g. demand from end-users of housing, purchased and financed in fashion similar to what those end-users have historically done.

When that non-organic demand will really unwind, though, is anyone’s guess. My guess is sooner, but I’ve been wrong before.

Comment by Housing Analyst
2014-12-25 15:47:18

You don’t have to guess. They’re already liquidating. You might to get ahead of them.

Comment by rms
2014-12-25 15:52:52

“I mistakenly thought once the housing bubble was broadly known to be a _bubble_ that folks would become much more hesitant to play along.”

+1 I have found that it is difficult to engage anyone in a conversation regarding today’s levels of debt and economic fundamentals because they’re all in debt. People used to host a mortgage burning party after their last payment, but these days I doubt you’d have any friends left if you mailed invitations.

Comment by Prime_Is_Contained
2014-12-25 17:43:59

You might to get ahead of them.

Ha, that’s funny—I got out a decade ahead of them! :-)

Comment by Whac-A-Bubble™
2014-12-26 00:00:51

Me too…been out an entire decade already. It almost seems like I see the handwriting on the wall too early for my own good at points.

Comment by Prime_Is_Contained
2014-12-26 00:08:00

I resemble that remark, PB—and have definitely had that same thought… Too early for our own good! :-P

Comment by phony scandals
2014-12-25 09:51:47

“‘4. You don’t need to be a conspiracy theorist to see that blaming North Korea is quite convenient for the FBI and the current U.S. administration. It’s the perfect excuse to push through whatever new, strong, cyber-laws they feel are appropriate, safe in the knowledge that an outraged public is fairly likely to support them.’

Comment by phony scandals
2014-12-19 18:26:53

Rolling the dice on the length of this post

Getting a whiff of False Flag here

Sony Hack Reinvigorates Support for Privacy-Busting CISPA-Style Legislation

White House, lawmakers exploit crisis to push for draconian data powers

by Paul Joseph Watson | December 19, 2014

The Sony hack attack has reinvigorated support for privacy-busting CISPA-style cybersecurity legislation that was previously considered dead, prompting calls to make the issue a top priority in 2015.

With the White House declaring the hack to be a “national security issue” yesterday, numerous prominent lawmakers jumped on the issue to push a “zombie” cybersecurity bill – the Cybersecurity Information Sharing Act – which failed to make the Senate floor in July.

White House Economic Council Director Jeff Zients said the Sony hack would require ongoing “executive” action by the President in order to protect “federal government assets,” with Zients stressing the need “to take this to the next level (with) legislation.”

Senate Intelligence Committee Chairman Dianne Feinstein echoed Zients, asserting, “We must pass an information sharing bill as quickly as possible next year.”

Comment by Prime_Is_Contained
2014-12-25 14:18:24

Getting a whiff of False Flag here

+1. It reeks.

How could Sony’s emails have anything to do with national security??

Total BS.

Comment by Housing Analyst
2014-12-25 08:47:26

Freddy The Fraudster

Comment by azdude
2014-12-25 09:11:42

cheer up bear pit, things could be a lot worse:

“54 percent – For the first time ever, more than half of all U.S. doctors support the legalization of assisted suicide.”

Comment by spook
2014-12-25 09:35:31

In the constellation of Cygnus there lurks an invisible mysterious force.

Comment by phony scandals
2014-12-25 09:57:12

Santa Claus Shot Down Over The Ukraine

By Blurtman Follow Wed, 24 Dec 2014, 11:58pm

Santa Claus has been brought down over eastern Ukraine, killing all reindeer and sharply raising the stakes in a conflict between Kiev and pro-Moscow rebels in which Russia and the West back opposing sides.

Ukraine accused “terrorists” - fighters aiming to unite eastern Ukraine with Russia - of shooting down the jolly fat man with a Soviet-era SA-11 ground-to-air missile as it flew from Amsterdam to Kuala Lumpur on Thursday.

Leaders of the rebel Donetsk People’s Republic denied any involvement, although around the same time their military commander said his forces had downed Peter Pan and Tinkerbell. It would be their third such kill this week.

US Vice President Joe Biden said the downing of Santa Claus was “not an accident” and that the portly elf and sled was “apparently … blown out of the sky.”

Comment by Ben Jones
2014-12-25 11:26:16

‘In the wake of a cyberattack that U.S. officials are pinning on North Korea, U.S. officials are working to make sure the North American Aerospace Defense Command (NORAD) Santa tracker is fully operational heading into the holiday.’

“Their anti-Grinch firewall is up and monitoring for threats, and they are confident that the AGFW, anti-Grinch firewall, can defeat any malicious attacks,” Pentagon press secretary Rear Adm. John Kirby said recently.’

Comment by In Colorado
2014-12-25 14:18:28

Makes sense. Since they’re Orthodox they celebrate Christmas in January and do not recognize the Roman version of St. Nick.

Comment by phony scandals
2014-12-25 10:03:16

Walmart customers “unruly” after store closes, police called

Breaking News Staff
Posted: 9:56 p.m. Wednesday, Dec. 24, 2014


Police had to be called after customers of a Walmart in Miamisburg became unruly when the store closed.

Police from Miami Township were dispatched around 8 p.m. when several customers became upset and unruly when the Walmart in the 8800 block of Kingsridge Drive closed Wednesday for observance of Christmas Eve.

Initial reports say people were trying to enter the store by force before police arrived.

Police say one citation was issued, but no arrests were made.

According to a company website, the location on Kingsridge Drive is normally open 24 hours, but closed at 8 p.m. for the holiday.

- See more at:

Comment by Raymond K Hessel
2014-12-25 16:44:13

Wait until the FSA’s SNAP cards get declined at Wal-Mart once our financial reckoning day arrives.

Comment by phony scandals
2014-12-25 10:08:05

It’s A Wonderful Lie: 100 Years of the Federal Reserve
Infowars re-uploads video repeatedly removed by YouTube

by | December 24, 2014

Infowars has once again released its report on the film “It’s a Wonderful Life” in defiance of YouTube censorship. The upload was taken down multiple times last year over alleged copyright infringements despite the full film being available on YouTube at the time. - 91k - Cached - Similar pages
19 hours ago …

Comment by Ben Jones
2014-12-25 10:14:36

‘Federal officials have sold more land for a Las Vegas senior affordable-housing complex that’s under construction. The U.S. Bureau of Land Management recently sold 5 acres in the south valley to the Nevada Housing Division at a steep discount for the second phase of Ensemble, as the 370-unit apartment development is known.’

‘The 5 acres had an appraised market value of $1.8 million, but the BLM sold the property for just $90,000, a 95 percent discount, according to Cannon. The 5-acre first phase, at 182 units, is under construction. It’s slated to be finished by the end of June, with the first units ready in April, Cannon said. The BLM sold that site to the state last November for $52,000. It had an appraised market value of $1.04 million.’

‘Ensemble will be 99 percent-owned by Wells Fargo Bank, said Lorri Murphy, vice president of real estate development at Ovation. The remaining 1 percent will be owned by Ovation and partner Accessible Space Inc., an affordable housing developer.’

‘A state-approved, tax-exempt bond is helping finance the complex. The developers bought the project site from the Nevada Housing Division for the same price the state had paid, Murphy said. Monthly rents for phase one start at $606 for a one-bedroom unit and $728 for a two-bedroom. Both prices include utilities.’

A comment:

‘The bank owns 99% and the owners own 1% with 1 mil. Public donation. I guess that’s good, the bank owns 150% of my house so I must own negative 50% but I digress, who gets title in 20 years ?’

Comment by Michael Viking
2014-12-25 10:34:13

“Federal officials have given free money to Wells Fargo and enabled them to get a steady stream of income for all time and all you can do is see red and get hot under the collar. Grin and bear it!”

Seriously…How and why is this possible? I guess because it’s for “charity”, over age 55 people with low income?

Comment by Guillotine Renovator
2014-12-25 11:27:12

This stuff is getting richer by the day. A bank which should not even exist anymore is feeding off its host more voraciously than ever.

Comment by Ben Jones
2014-12-25 11:32:18

It’s still $18,000 per acre. What did the BLM pay for it? Wells Fargo gets to milk these people $600-700 a month? This same bank can take a 1 dollar deposit and use it as collateral to loan out $9.5. And charge the depositor a fee for the privilege.

Comment by Guillotine Renovator
2014-12-25 11:53:30

I’ve still not had to pay $1 for my banking, but that’s probably coming. When it does, I go to the proverbial mattress.

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Comment by oxide
2014-12-25 14:27:35

Unless you live in a tent and eat berries and squirrels, I think you’re SOL. There are very few ways to pay — and be paid — which don’t require at least a basic checking account. And if you do conduct transactions without a checking account, the fees for that will be much higher than what you would pay for the basic checking account.

Comment by Blue Skye
2014-12-25 21:15:55

I don’t pay a fee for my bank account, and I get rewards for paying via it. I could go all cash if there was a reason to do so, with the exception of rental cars. They just won’t take cash for that. Occasionally a boater needs to rent a car.

Comment by Guillotine Renovator
2014-12-25 12:05:48

I remember years ago looking at a 5 acre parcel with timber that was on Craigslist FSBO. I think he was asking $79k, but I can’t remember exactly. This was back around 2004/2005. Anyway, I thought it was way too much, but it was actually a little less than anything else comparable.

I met the guy at the property, and he had to be pushing 90 years old. He told me he had several 5 acre sites for sale, so we got into his truck and he drove down the long dirt road, showing me many of them and said “you’re free to walk them all and if you’re interested in something make me an offer.” We got to talking about how long he owned them and he said his grandfather (IIRC) bought the land back in the late 1800’s. If I’m not mistaken it was $5 per acre and he purchased over 1,000 acres, I think it was close to 5,000 acres. He was the largest landowner in the area. Anyway, the family had been selling small portions off for generations after short-platting sections. It’s a good living if you can win the birth lottery.

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Comment by Ben Jones
2014-12-25 10:23:36

‘The 3% down payment mortgage has been made available to consumers with a speed rarely seen in this business, in large part because more lenders than ever are selling loans directly to Fannie Mae and Freddie Mac.’

‘In the past, originators that sold loans to aggregators or wholesale lenders had to wait until the purchaser put in its own additional guidelines for the product, or overlays, on top of what the government-sponsored enterprises required. That process could take a couple of weeks. By selling directly to the GSEs, lenders are able to put this product on the menu much quicker. “The market dynamics today are different than they were three or five years ago,” said Bill Cosgrove, chief executive at Union Home Mortgage of Strongsville, Ohio.’

‘The quick roll-out of this product has been a nice holiday season gift for an industry that did not get the expected boost in purchase business from first-time homebuyers and millennials it was expecting in 2014. To take full advantage of the gift, the industry needs to make consumers aware that low down payment loan products are available.’

“If you want to push it, market it and get it out there, I think you should absolutely be able to increase your business if you market it to your clients and real estate agents and everybody else,” said Michael Deery, president of Citywide Financial, a mortgage brokerage based in San Diego.’

‘Another factor behind the speedy introduction of the loan is the impact of the qualified mortgage rule. Before the mortgage crisis, the credit box had more grey areas. The source of this ambiguity was the GSEs’ automated underwriting systems, Cosgrove said. Today the credit box is more defined because of QM and “it is making it easier for us to make quality control decisions, make underwriting decisions and make the risk decision to bring the product to market.”

‘Ditech added the 3% down product to its retail offerings on Dec. 15 and to the correspondent originators it purchases loans from a week later. For the 2015 spring home buying season, having this product available will be instrumental in helping Ditech reach more first-time homebuyers, Smith said. It will have marketing programs aimed at first-time buyers and this product will let Ditech qualify and serve more of them.’

‘The high cost to the consumer of FHA mortgage insurance will drive the more-creditworthy borrowers to the GSE product, O’Dell added. But the industry is looking to make the FHA product more competitive with this GSE offering. On Dec. 18, a group of 18 Democratic U.S. Senators sent a letter to HUD calling on the agency to reduce FHA premiums. The MBA sent a similar letter the same day.’

‘While the conforming product right now is a better option than the FHA product, Cosgrove said, “we are encouraging FHA to lower their … premiums to be more competitive and a cheaper source of mortgage financing for first-time homebuyers.”

‘NAMB, a mortgage broker trade group, has also come out in favor of an FHA premium reduction. “From an industry perspective, it makes sense for the FHA,” said Don Frommeyer, the trade group’s CEO, in a press release. “If premiums remain this high, the Administration will be flooded with mortgage applications by borrowers with lower credit scores, while those with better credit will finance through Fannie Mae and Freddie Mac.”

Comment by Housing Analyst
2014-12-25 10:28:32

And you thought the fraud was out of control 2009-current?

Watch this runway foaming operation.

Comment by Ben Jones
2014-12-25 11:39:48

‘November’s mortgage default risk index was reported at 11.69 percent, its highest level in two years, according to a briefing released by the American Enterprise Institute’s International Center on Housing Risk.’

The November default risk index crept upward by 0.4 percentage points from October, when it was reported at 11.29 percent. The goal of the index is to measure the default risk of mortgages by comparing recently originated loans to those with a 2007 vintage and determining what percentage of the more recently originated loans would fail under conditions similar to those during the 2007 housing crisis, according to the briefing.’

‘The authors of the index estimate that even though the index is at a two-year high, it is close to half of its 2007 level during the height of the crisis. They estimate the index would have been about 19 percent during 2007, while a reading in a stable market would be about 6 percent – matching mortgage risk levels from the early 1990s.’

‘The most risky loans were those backed by the Federal Housing Administration (FHA), which registered an index reading of 24.26 percent for November (an increase from 24.17 percent in October). The Department of Veterans Affairs (VA) index reading was at 11.44 percent, according to the briefing. Pinto and Oliner noted that risk for FHA loans would be substantially lower (9 percentage points) if those loans used the same underwriting criteria as the VA, namely the calculation of residual income.’

‘A slowdown in large-bank mortgage lending activity mean an increase in the share of mortgage risk for non-bank mortgage lenders in November, according to the briefing. Non-bank-originated loans, which accounted for about 53 percent of November’s origination activity, had an default risk index reading of 13.5 percent. By comparison, large banks accounted for about 30 percent of originations and registered a reading of 10.5 percent on the index, the briefing reported.’

‘No state was below the “stable market” index reading of 6 percent for November, according to the briefing. The states with the three lowest readings were Hawaii (8.9 percent), Vermont (9.1 percent), and Oregon (9.3 percent). The three states with the highest readings were Mississippi (14.5 percent), Louisiana (13.7 percent), and West Virginia (13.2 percent). Nineteen states had readings higher than the national average of 11.69 percent.’

Comment by Housing Analyst
2014-12-25 10:23:47

How painful are your losses on housing?

Comment by Whac-A-Bubble™
2014-12-25 11:54:57

I’m up about 35% on the Vanguard REIT I snapped up back when the Fed started its QE3 housing market reflation program. This is diversified real estate; not sure how much is housing versus other real estate assets.

Comment by Guillotine Renovator
2014-12-25 22:35:18

You better JUMP OUT of that thing.

Comment by Whac-A-Bubble™
2014-12-26 00:03:30

Why? Since I’m short owner-occupied house, I figured a little real estate diversification might help hedge my portfolio against any manner of crazy subsidies and stimulus the gubmint might use to prop up the real estate bubble. So far it’s worked out just great!

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Comment by Prime_Is_Contained
2014-12-26 00:11:22

Since I’m short owner-occupied house, I

Funny, I don’t think of not owning a house as being “short”; not holding something, you’re neutral, or out of the market.

Comment by Whac-A-Bubble™
2014-12-26 00:18:18

I don’t suppose there is any natural way to enter a contract where one borrows a house, then sells it with an agreement to buy it back at some future point in time in order to return it to the owner before the expiration date of the contract?

Comment by Prime_Is_Contained
2014-12-26 00:24:22

Seems unlikely; those contracts work great for fungible assets, but most owners want to continue owning the same house. :-)

Maybe you could make it work with a repo agreement though??

I did try to borrow some bitcoin from a co-worker in order to short them near the peak, but he was a bit reluctant so I didn’t push the matter…

Comment by Whac-A-Bubble™
2014-12-26 00:28:51

It was just a hypothetical, as I am not wealthy enough or foolish enough to gamble on owning or shorting individual houses*. That is one of the worst diversification moves that anyone can possibly make, no?

* True confession: I’ve owned twice, but it was more-or-less a sure thing in both cases, since there was no bubble in place and we were in the tailwinds of a recession with plenty of inventory available at fire sale prices.

Comment by Blue Skye
2014-12-25 20:57:48

My losses are tolerable only because of the small scale and bubble avoidance. I spread $400 worth of crusher run on the driveway after our historic spring flood downpour turned it into a stream bed for a couple of days (google Penn Yan flood). I committed to have a high e window inset built at the local glass shop for the picture window in front of my workbench in the studio part of the house. $275. Installation “help” included. I paid over $100 for a truckload of 4/4 white oak which is stickered out back. Should make a nice robust floor throughout the studio in another year or so, approximately 1200 ft2. Going to peg it with Walnut from the neighbor’s tree that came down and was donated to the cause. There are a few other little things, I’m probably looking at $1,000 for the year in the relentless battle against obsolesce, decay and makeover lust.

I need a better work counter in the kitchen, but I scored a gorgeous massive maple headboard put out to the curb up the street by some Victorian attic cleaner outers. Free. Must be 150 years old if not 200, the bed was a rope bed. Side rails long gone, replaced by angle iron, yuck. The turned posts are 6″ in diameter, will make great legs for the new to me table.

Just not living the mania anymore.

Three months until the covers come off the Blue Skye and I will turn the key on this winter keep. I did some art this December in earnest. Donation to the Children’s Hospital and some gifts for family. I am really looking forward to 2015.

Comment by shendi
2014-12-25 10:27:03

Happy holidays everyone.

Just back from 3 weeks in Japan. The dollar bought a lot of things compared to a year ago, Abenomics being the reason. Everyday food seems to the same price in Yen from last year, train tickets have increased a wee bit, airline tickets have come down or remained the same.

IMO, if you want to see a maxed out country as in peak civilization this is it. No matter what Abe does there the growth is not going to be there. I can elaborate more if anyone is interested.

Comment by spook
2014-12-25 10:46:22

Have they considered trying “Mexicans?”

Comment by Ben Jones
2014-12-25 10:53:21

I’d like to hear more shendi.

Comment by shendi
2014-12-25 12:39:24

We have all read about the civilizations / kingdoms that vanished eg. Mayan, ancient Khmer. There is some clue, IMHO, in what is happening in Japan. Hbbers have mentioned most of the key things that could go wrong with an economy - imagine that happening in Japan from different angles in slow motion. Here is what I see:

1. Every possible convenience to make a worker’s (salary-man) life easier has been developed/ invented. Japan is a society that moves in a “herd” mode, in a good way, to adopt conveniences in their life, rather easily & quickly. So almost every household has these “goods”. $200 to $400 rice cookers and robotic vacuum cleaners come to mind.

2. The cities are packed, people are traveling, visiting places, buying things, eating out including the young. There are festivals, events are usually packed with the young and the old alike.

3. The young (age 21 to 30 generally) do not have full time jobs. They are moving from one part time job to another. Most are staying with their parents and some of them still go to school (college) and take one subject per semester.
This means the young cannot buy commercially expensive goods such as apartments/ houses and along with it TVs, washing machines. The hourly wage ranges anywhere from $8 to $15 in Tokyo and other major cities.
One thing of interest is that, these hourly workers will spend their money on the things that they like: electronic accessories such as cell phones, headphones; dress accessories such as belts, hats, bags, watches. There are literally no savings.

4. Like all export based economies, Japanese made stuff is expensive in Japan compared to the same stuff sold in USA. In some cases the Japanese home appliance market is highly specialized particularly the sizing - washing machines (dryers are rare in a household & expensive).
The alternative is cheaper stuff from abroad such clothes (Uniqlo) and fresh vegetables from china.

5. Train tickets are expensive for Japanese compared to foreigners, however the Shinkansen are packed with people that travel for business, students and those on holiday. Occasionally you see some foreigners (typically they do not travel to remote places).
Local trains in an around Tokyo and business centers such as Yokohama, Kawasaki etc, are full almost all through out the day. Rush hour is extra packed.
Long distance buses, on the other hand are cheap due to extreme competition. A lot of part-time workers take these overnight buses to visit family.

In talking with the older folks, they are concerned for their kids’ future complaining how expensive everything is from food to education. People are ambivalent about Abenomics. The ones with the full time jobs don’t really care, and the underemployed ones hate the government.

So it is little surprise to me to see the Japanese hawking credit cards at every mall/ shopping center.

Overall it appears to me that export is only option they have, but in the process all imported stuff such as the cheap clothing and food from China is going to go up, which will cause the part-time workers, who are mainly the young to tighten up the belts.

Comment by Ben Jones
2014-12-25 12:52:41

‘How Japan’s economy put itself out to pasture’

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Comment by shendi
2014-12-25 13:22:45

Good article, especially this point

(5) Corporate sector with a strong balance sheet after 25 years of deleveraging, but with low investments and no inclination to invest in Japan (given demographics). Corporations are thus a net saver.

Also, for the corporations there is nothing much to invest in. Competition is tough in any field. The only sector seeing growth is automotive, because of the world market share of the Japanese companies.

IMO, the savers “dissaving” is not going to happen easily, just because of a lifetime of habit. Case in point is the resistance to credit cards with the desperate shilling by the credit card companies. Japan will be a cash society for years to come. This may be one of the reasons that Japan’s problems came to the forefront much earlier - that the household debt was only in housing. Just like the corporations that strengthened their balance sheets, the Japanese that bought the houses during the peak reduced the debt load these past two decades.

The next big thing is not going to come out of Japan. The only thing left is entertainment - like video games with is cut throat competition.

Particularly, in looking at Japan it brings to mind the phrase
“borrowing demand from the future”. Japan seems to be a place where the future demand of 3, 4 decades was already borrowed into existence.

Comment by Bill, just south of Irvine
2014-12-25 14:04:01

Whether or not anyone in particular has children will do nothing to reverse the demographics of population decline. Ni will be dead before the population decline reverses.

The article Ben posted says near the beginning that Keynesian economics is failing when accompanied by population decline.

A lot of finger pointing about the cause of the decline has been going on. I can find 100 different reasons. Well how about them all? Why can’t all those be the reasons?

And back to Keynes: the recipe has been in printing money, an excess, so far in Japan it knocked the savings rate from 20% down to 3%. That tells me the people think the Yen is a hot potato.

What if they are really saving in other assets? I don’t know which one, but they may be into the Dollar. Or Yuan.

A worldwide deflationary environment could go for decades. Seems real estate will certainly deflate for decades, at least in Japan.

I wonder if international currencies in maybe at least five currencies would be the asset to hold in the decades of deflation? Not just one….

Comment by Oddfellow
2014-12-25 15:54:45

“(2) A shrinking population (from currently 127 million to 87 million inhabitants by 2060).”

I’m not sure anything can fix that.

“What if they are really saving in other assets? I don’t know which one, but they may be into the Dollar. Or Yuan.’

That would weaken the yen against those currencies, which is what Abenomics intends to do.

Comment by Bill, just south of Irvine
2014-12-25 13:46:37

Thanks for your post!

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Comment by SUGuy
2014-12-25 11:22:01

Please do elaborate on Japan. I had been planning a vacation to go there but my better half is not interested at this point due to the radiation of Fukashima. How is the population coping with the after math of the Fukashima disaster?

Comment by shendi
2014-12-25 11:57:28

For a vacation nothing beats Japan - with the convenience of transportation, good food, nice people, good scenery etc. You have to visit Japan to experience it. I like the temples high in the mountains. It is like urban hiking.

Fukushima has not affected anything in the neighboring areas such as Saitama & Gunma provinces. I visited both. People travel all over the place all the time. So if you are visiting Tokyo/ Chiba area or Hokkaido there is nothing to be concerned about it. Of course you can visit the Kansai region (Kyoto/ Osaka, Nagasaki).

Comment by SUGuy
2014-12-25 12:28:29


Besides electronic gadgets that are software driven in what ways are the Japanese ahead of the US in terms of peak civilization. I think this past credit expansion will not be replicated in the US in my lifetime/ Just my opinion

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Comment by shendi
2014-12-25 12:59:05

A longer post that gives some idea on Japan is yet to appear. To elaborate on that post:
Japan has a population problem, their old are in much better health and live longer with two problems for their economy (from a lifestyle point of view this is good), first, the service related jobs in healthcare are simply not created (and not as much as required in the USA) and second, inheritance is delayed, which could theoretically result in spending.

Automation in factories is actually taken to a different level that new workers are seldom required. Japan had adopted the US way of laying off people and this past decade has accelerated it.

Their young have interest in things such as houses/ apartments, cars and big ticket home appliances - maybe due to lack of good jobs.

Comment by Housing Analyst
Comment by Bill, just south of Irvine
2014-12-25 11:55:47


Sweet of you to wish the donk a Merry Christmas!

Comment by Housing Analyst
2014-12-25 12:58:41
Comment by Bill, just south of Irvine
2014-12-25 13:43:47


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Comment by oxide
2014-12-25 13:28:24

Thanks HA. It’s nice to know that someone will always to reply to my posts, even if it’s just a Hey Donk. Going pretty well here, actually.

Comment by Housing Analyst
2014-12-25 15:12:02

We enjoy your drama Donk.

Comment by real journalists
2014-12-25 11:26:43

Everyone Must Check In

Comment by phony scandals
2014-12-25 16:37:42

Region IV

Comment by Prime_Is_Contained
2014-12-25 17:45:24

Region X; good day.

Comment by Prime_Is_Contained
2014-12-25 11:40:52

Merry Christmas, everybody! I hope your holiday is filled with good things.

Comment by rms
2014-12-25 15:39:57

Region X, checking in. Actually reached the mid forties today; no white Christmas this year. Took my son out for a 10-mi bicycle ride, clear and cloudless, so the sun’s radiation felt nice. We were the only peeps outside; not another soul in sight. Very quiet.

Comment by Whac-A-Bubble™
2014-12-26 00:13:55

I’ll be hanging out 4 miles east of Ferguson tomorrow (6 miles east of Berkeley, MO), and I certainly hope no people are out!

Comment by Whac-A-Bubble™
2014-12-26 00:10:39

May your days be merry and bright,
and may all your Christmases be white.

Comment by Bill, just south of Irvine
2014-12-25 13:25:01

This is my favorite time of the year for sure. And it gets better from here through the first week of January.

Are any of you excited about plans you have for next year? Are you thinking about them?

I have plans involving open source software over three computers, maybe also my Droid and iPad. These are money making opportunities that, if they do not create my own business, they will at least strengthen my commercial software skills and keep me busy for years out west.

My ideas become clear as I go and as I learn, and lead to new investigations and tools and ideas, it is a slow progression but I canot think of retirement when there are so many interesting things about software technology.

Comment by Whac-A-Bubble™
2014-12-26 00:19:56

“Are any of you excited about plans you have for next year? Are you thinking about them?”

Learning How to Learn: Powerful mental tools to help you master tough subjects

Comment by Housing Analyst
2014-12-25 14:35:48

More optimistic economic news out of WA state.

Lynnwood, WA Prices Gains Evaporate Year Over Year; Prices Crumble 12% QoQ, 12% MoM

Comment by Prime_Is_Contained
2014-12-25 15:41:48

Late response:

Comment by Bill, just south of Irvine
2014-12-18 14:02:59

Oh found out today Fidelity Contra fund paid me a dividend of over $6,000 on a $100,000 balance in my ex employer’s 401k. I did not have to mow a bunch of lawns for that $6,000. I did not have to spend weekends at Home Depot for that $6,000. I did not have to shake down tenants who punched holes in walls and tore out the plumbing for that $6,000.

Bill, your statements above demonstrate a significant misunderstanding of mutual fund dividends. The value of your mutual fund remained constant across this ex-dividend date; the market value of your remaining fund goes down in an amount identical to the value of the dividend—check the NAV before and after the ex-dividend date and you’ll see what I mean.

There was no $6K profit for you in this transaction. It is merely a taxable event; luckily for you, it was in a 401k account, so it was a non-event on that front for you as well.

Comment by Prime_Is_Contained
2014-12-25 15:48:57


Comment by Bill, just south of Irvine
2014-12-18 22:07:08

Oh well. It’s up by $4,000 since I had that fund opened in September or October.

Note that by purchainsg a fund just before it goes ex-dividend, you end up receiving a pro-rata portion of the tax effects for the year even though you did NOT receive the benefit of the gains!

This is commonly referred to as “buying the dividend”—but don’t be confused, it is a harmful thing to “buy”.

Since you purchased relatively late in the year, and were up by less than the $6K dividend, you did this in part. Again, the 401k saved you from the associated tax harm, so no biggie; but don’t do this in the taxable account!

Comment by Bill, just south of Irvine
2014-12-25 17:28:45

Yeah. Long time been aware of that and always made my rear view nd fund purchases outside retirement plans after the distributions.

Comment by Bill, just south of Irvine
2014-12-25 15:50:40

Yeah I got that. The problem is I noticed it happen years ago and found out. But it hasn’t happened again til now. On the other hand in my vanguard funds the dividends are real. The NAV does not crop to compensate, that is how I know. Dodge & Cox funds same way.

Comment by Prime_Is_Contained
2014-12-25 17:47:45

On the other hand in my vanguard funds the dividends are real.

Not possible; this occurs with all funds, including Vanguard and Dodge & Cox. It is a fundamental property of the fund structure. The value cannot be the same after some of the value is forced to be distributed by law.

Comment by Bill, just south of Irvine
2014-12-25 19:04:21

Wrong. I did the math.

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Comment by Housing Analyst
2014-12-25 19:45:52

Good for you and good smackdown. There seems to be a reluctance to do math around here lately.

Comment by Bill, just south of Irvine
2014-12-25 19:47:13

I would expect to see a drop in the NAV to compensate for the distribution. I check historical prices +/- 2 weeks around the distribution and do not see any variance to account for it.

Comment by Prime_Is_Contained
2014-12-26 00:05:17

Which fund were you referring to, Bill, so I can check the same data?

Comment by Prime_Is_Contained
2014-12-26 00:21:55

I check historical prices +/- 2 weeks around the distribution and do not see any variance to account for it.

Ah, that might be your mistake. The date that the dividend is paid as a distribution is the wrong date to check.

The date to check is the “ex-dividend date”; that means that ownership on this particular date determines who receives the dividend. You can literally sell the day after the ex-dividend date and still receive the dividend distribution, even though you don’t own the shares on the distribution date. The two dates are sometimes weeks apart.

The NAV drop occurs between the ex-dividend date, and the following day, not on the date that the distribution occurs.

Comment by Housing Analyst
2014-12-25 16:00:42

Sale Prices Plunge 22% YoY As Philadelphia Leads Prices Lower In The Northeast

This is positive economic news out of the mid-atlantic area.

Comment by phony scandals
2014-12-26 06:29:54

phony scandals

Comment by phony scandals
2014-12-26 10:02:58


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