Evidence Of The Shoe Dropping
My Fox Houston reports from Texas. “As Houston prepares to welcome a new year, Houston accountant Bob Martin’s best advice for folks living in the energy capital of the world? ‘The most important thing is to pay down debt,’ he said. ‘We’re starting to see signs where housing prices are cooling and so people are proceeding a little more cautiously.’ Houston’s housing market may be cooling, but one drive around the city would have you guessing otherwise. House prices are up, while the price of fuel is down. ‘We’re in somewhat of a paradox,’ Martin said. ‘We like the low price at the pump but if you’re here in Houston, you might be getting the low price at the gas pump, but you may be out of your energy job in a few months.’”
The Star Tribune on North Dakota. “A million barrels of oil a day pump out of North Dakota’s Bakken shale. Oil that used to sell for $100 a barrel and now fetches barely half of that. Oil that pumped billions into the North Dakota economy, drove the state’s unemployment rate down to almost nothing, and turned sleepy farm communities into Wild West boom towns. And for now, the new year is still looking bright in places like Watford City.”
“There’s a new $50 million high school under construction, with plans for another grade school to accommodate all the students who overflowed the classrooms and spilled out into half a dozen portable units on school grounds. The city, which ballooned from a farm town of 1,500 to a population of 12,000 and counting in the space of five years, is finalizing plans for a $101 million event center, complete with conference and performance spaces, two hockey rinks, a 135-foot water slide and an indoor lazy river.”
“‘Nothing has changed quite yet,’ said Steve Holen, superintendent of McKenzie County Public School District No. 1. ‘There’s some nervousness, obviously. If there is a little bit of a lull, it’ll probably provide an opportunity for some of the infrastructure to get built out, and give some time for a little bit of catch-up. I don’t think anybody’s assuming that it’s just all going to go away.’”
The Financial Post in Canada. “It’s been years since David Yager has seen multiple ‘For Sale’ and ‘For Rent’ signs in Fort McMurray, the northern Alberta city that is usually crawling with workers from across Canada looking to make a buck in the oilsands boomtown. ‘There’s no question that we’re not going to need as many workers as we have,’ said Mr. Yager, national oilfield services leader for Calgary-based consultants MNP LP. ‘That’s bad for the workers, but that might take the pressure off wages.’”
“As ATB Financial’s chief economist Todd Hirsch said, employment statistics are showing the first signs of trouble. He noted that the labour force numbers for the month of November showed 11,000 jobs were shed in professional, scientific and technical occupations. ‘Those would be the engineers, those would be the geophysicists, those would be anything that an oil and gas company might contract out to a third party,’ Mr. Hirsch said. ‘That’s a very unusual drop in those occupations; that’s sort of the first statistical evidence of the shoe dropping.’”
The BBC on Australia. “After 23 years of growth, including one of the biggest mining booms in the nation’s history, tumbling iron ore and coal prices have put a brake on Australia’s economy - and mining towns are paying the price. Peter Windle is a casualty of the mining slowdown. The New South Wales mining employee has lost a well-paid job, a company car and an annual bonus that in some years was as high as A$60,000 ($48,800; £31,300). Mr Windle had to sell his investment property to keep his head above water.”
“Once part of a vast army of workers in what was Australia’s booming resources sector, Mr Windle now gets up at 5.30 am five days a week to clean and drive school buses in the small town of Muswellbrook. For decades, the town had ridden the waves of Australia’s coal boom. ‘It’s the worst I’ve seen it in 28 years in the mining industry,’ says Mr Windle. ‘Everyone is getting out. Three hundred houses are for sale in my town, three in my street, and rental prices have collapsed on older weatherboard houses from A$1,000 a week to A$200,’ he says.”
The Australian. “China’s steel industry has warned that iron ore prices will remain under pressure over the year ahead as the nation’s steel mills battle with over-capacity and weak demand. ‘The iron ore price will remain on the downward track while the coal price may stabilise or rebound slightly,’ said Yang Zunqing, deputy secretary of the China Iron and Steel Association. Mr Yang told an OECD workshop in South Africa that despite the dive in the costs of raw materials, the Chinese steel industry was still struggling to break even, with the major mills suffering a fall in sales revenue in the first nine months. Prices received by the Chinese steel industry are the lowest since January 2003.”
“Mr Yang said demand from the property sector would remain weak, with new property starts over the first nine months of the year down by 9.6 per cent from a year earlier. This is flowing through to sales of major household appliances. Washing machine sales are down 3.8 per cent while freezers are down 2.8 per cent.”
“A report by the Britain-based Commodities Research Unit said that while softening in the Chinese economy was contributing to the downturn in the market, it was not the main cause. ‘A surge of low-cost supply from Australia has been the principal driver dragging prices lower,’ CRU analyst Laura Brooks said.”
‘Australia’s manufacturing industry has declined sharply, with the lower Australian dollar failing to lend a hand. Manufacturing fell by 3.2 points to 46.9 in December, according to the Australian Industry Group’s performance of manufacturing index (PMI) on Monday.’
‘The index dropped well below the 50-level that separates expansion from contraction, despite the Australian dollar having traded at four-and-a-half year lows during December.’
‘The figures were disappointing, but not surprising, Ai Group chief executive Innes Willox said. ‘We would have hoped to have seen a stronger Australian PMI in the lead-up to Christmas, but the finding is consistent with other publicly released data,’ Mr Willox said. ‘Business sentiment and appetite for investment remain weak.’
‘The closure of Australian automotive assembly facilities now under way, plus the rapid decline in mining investment activity, are also weighing heavily on demand for locally made machinery inputs and components.’
‘The textiles, clothing, footwear, furniture and other manufacturing segment experienced its fastest pace of expansion in six years, thanks to the lower Australian dollar and stronger furniture sales courtesy of the housing construction boom. Meanwhile, the machinery and equipment sub-sector remained in contraction, where it has been for three years, and is likely to worsen as car production in Australia reduces more sharply in 2015.’
Remember the farm land bubbles we’ve read about for years?
‘A decline in farm earnings slowed personal income growth in much of the Midwest in the third quarter. Lower prices for corn, soybeans and wheat drove down profits for farmers across the country’s breadbasket, pushing Illinois, Minnesota, South Dakota, Iowa and Nebraska to the bottom of the list for income growth over the 12 months that ended in September, according to data released recently by the U.S. Department of Commerce.’
“Overall, the economy grew and personal income grew, but there were certain areas that were hit hard, especially farm income,” said Toby Madden, an economist at the Federal Reserve Bank of Minneapolis.’
‘Income dropped noticeably in rural Minnesota in 2013 and the latest figures show the trend has continued. Strong crop yields nationally pushed commodity prices down in the early fall. Corn prices fell below $3.40 per bushel at the end of September, and some Minnesota growers lost money in the harvest or considered themselves lucky to break even.’
‘As a result, farm income in the third quarter fell by $1.6 billion in Minnesota compared with a year earlier and declined by a total of $17.4 billion in all Midwestern states.’
‘Another factor driving down personal income in Minnesota has been persistent weakness in finance and insurance. Those industries in Minnesota shed 3,800 jobs in the 12 months that ended in September, and have been the weakest industry for jobs in the state over the past two years.’
‘That’s now reflected in the personal income figures. Income from finance and insurance dropped by 4.5 percent in the third quarter compared with a year ago — by far the biggest drop for any state and a decline of $742 million.’
“The housing market has not done as well this year as had been expected, and so I’m thinking that some of the challenges in the finance area might be related to that,” said Laura Kalambokidis, the state economist.’
Sounds like we’ll need more farm subsidies to replace the lost income.
that,” said Laura Kalambokidis, the state economist.’
the gov workers get to keep their jobs
So, it’s starting. Civeo (formerly PTI Camps) is closing several camps, oilsand worker lodges, around Fort McMurray. Which means the traditional Alberta fall-back position – “I can always find work up north” – is rapidly drying up.’
‘It’s not just that oil prices have gone into the dumper. It’s that they keep going deeper and deeper into the dumper.’
‘A chill is settling in. Big Oil’s top bosses are revising their 2015 marching orders. Hiring freezes, spending cuts, less capital investment than was anticipated. Even a month ago, they were speaking brave words about oilsands investments being long-term, immune to volatile day-to-day oil prices. Now they’re starting to sweat.’
‘In late November, the oil patch semi-scoffed when CNRL oil company board chair Murray Edwards predicted a low of $30 before oil stabilized in the $70 to $75 range. They’re not scoffing anymore.’
‘U of Calgary economist Jack Mintz, a man whose numbers are usually right, estimates the Prentice government will face an unexpected royalty revenue shortfall of $500 million in the last quarter of the current 2014/15 year.’
‘If oil averages out to $60 a barrel, Mintz says the Alberta government will be down $5.7 billion from previously expected royalty revenues in 2015/16.’
‘The province has already stopped hiring, is imposing spending restrictions, and may, even if it dumps the entire “rainy day” $5 billion contingency account into the 2015/16 budget, still have to find more spending cuts, take on more debt, or raise taxes.’
‘So how will all this affect Edmonton? I wrote just weeks ago that the local economy would slightly cool, but that would not be a bad thing. But at the start of December, oil was at $70 and has now dropped to $55 and nobody knows where the bottom is.’
‘If oilsands companies jam on the brakes in the next few weeks, severely cutting both capital and operational spending, it will impact on Edmonton far more than was foreseen scant weeks ago. If oil prices stay below $55 for the next few months or years, real estate prices will soften, new jobs will be hard to find and wages will drop. The CMHC says housing prices in Fort McMurray will likely fall by 5.2%.’
‘Doesn’t matter. We’ve lived high off the hog in this province for years. Any contraction will severely hurt. If oil prices stay under $55 for three, six, 12, 36 months … I’d hate to be a developer with a condo tower going up, while real estate prices are going down.’
And when the hedges end, shale oil in this country is over until oil goes above $80 a barrel:
http://in.reuters.com/article/2015/01/05/oil-hedging-idINL1N0UJ0ES20150105
Don’t worry, the oil sand will wait patiently for another 35 or 80 years.
Too bad we need the four million barrels of production from shale oil to balance the supply and demand.
Overflowing tank farms and millions of excess empty houses, cratering demand for both results in falling prices.
Remember…. Falling prices are positively bullish, patriotic and your wallets best friend.
So Dan, are you anticipating gas lines?
Craternation.
Bwhahahahahahaha. Can’t wait for the super sale prices of 50% off.
No, because I do not anticipate that we will continue to follow non-market based policies. However, the type of policies we are following now would lead to gas lines.
Mania was not a policy.
6-7 years ago I talked to a pipeline guy. He said that below $80/barrel, companies retreat to core business, and contracting for extra goodies like consulting or R&D or analysis goes bye bye. That’s at $80, and that was 6-7 years ago.
Double peak Oxy, and now we are on the second downside. Tits up so to speak.
…or a second 100 million…..
Is today when oil is going to break bad below $50/bbl?
Crude Oil - Electronic (NYMEX) Feb 2015
NMN: CLG5
Market open $50.87
Change -$1.82 -3.45%
Volume 127,395
Jan 5, 2015 9:53 a.m.
Previous close $ 52.69
Day low $50.55
Day high $52.73
Open: $52.61
52 week low $50.55
52 week high $101.33
Oil falls below $50 a barrel for the first time since April 2009
33 Mins Ago
Reuters
The selloff in oil continued with little pause into the new year with U.S. crude futures tumbling below $50 a barrel on Monday for the first time since April 2009 on fears of a global supply glut.
U.S. crude’s front-month contract fell to $49.95, down 5 percent from Friday’s close, before recovering to $50.20 by 11:36 a.m. EDT
Brent crude for February also hit a fresh 5-½-year low, falling as low as $52.66 per barrel before rebounding back above $53.
The two crude oil benchmarks have now lost more than half of their value since mid-2014.
…
If oil drops below $50, we’re all doomed!
Whoops…
Crude Oil - Electronic (NYMEX) Feb 2015
NMN: CLG5
Market open
Price $49.87
Change -$2.82 -5.35%
Volume 338,994
Jan 5, 2015 2:44 p.m.
Previous close $52.69
Day low $49.80
Day high $52.73
Open: $52.61
52 week low $49.80
52 week high $101.33
God, Please give us one more oil boom. I promise not to p*ss the windfall away this time!
Lemmings never learn. Never amp yer lifestyle based on the price of oil.
You will have your wish very quickly. It use to take ten to fifteen years to lose 35% production from a field, with shale oil is takes six months. People that have bought big vehicles based on the gasoline prices will have only paid 24 months of their 72 month loans before the price is back where it was this Summer.
“People that have bought big vehicles based on the gasoline prices”
I was amazed by the number of car haulers that were traveling the highways over the holidays. The next big shock is going to be the vaporization of all those wonderful jobs the mania created, then the defaulting car loans. Maybe “one of the next big shocks”.
A crude oil dead cat bounce?
Ooooph.
Without the bounce…
I am very happy today, the oil manipulator ( U.S. government )got very burnt figures. It is been using the dollar to undercut oil without paying a price. Today the manipulation caused the market to crash. Add in the fundamentals 77 fewer rigs in NA we are very close to the bottom in oil and within a few months we will heading up like a bullet.
Why buy today when you can buy later for 50% less?
figures=fingers
“a few months we will heading up like a bullet”
I think you’re already up there danny. Buckle up, there are a few more stages of grief for you to go through.
“…got very burnt figures.”
Fingeratively speaking?
“…the oil manipulator ( U.S. government )got very burnt figures.”
Whose side are you on? The Russian government’s? Or the Chinese government’s?
Those are some mighty interesting preferences you display here…
Lower gas prices are good news for Democrats: Falling energy costs could spur an economic boom, fuel Clinton victory if she chooses to run in 2016
By Patrick Reddy
SPECIAL TO THE News
on January 4, 2015 - 12:01 AM
After the poor showing across-the-board of her fellow Democrats in the 2014 elections, Hillary Clinton received some much-needed good news when the House Intelligence Committee, chaired by Michigan Republican Mike Rogers, cleared the State Department of any wrongdoing in the 2012 attack on Benghazi, Libya. But Clinton received even better news with the sharp drop in crude oil and gasoline prices of late 2014.
Thanks to the vastly increased domestic oil production and the willingness of Saudi Arabia to maintain high production supply levels, energy costs have been falling. The average retail price of a gallon of gas dropped from a peak of $3.96 in May 2011 to $2.29 last week, thus saving American consumers literally billions of dollars. Were those lower prices to continue in 2015 and 2016, the nation would likely witness an economic boom that creates millions of new jobs, reduces the prices of numerous consumer goods due to lower production and shipping costs, sends the stock market soaring ever higher and helps slash the federal deficit.
Since the rise of the Organization of Petroleum Exporting Countries in the early 1970s, sharp increases in oil prices have led to both rising inflation and recessions in the industrialized nations of the West that economists dubbed “stagflation” – a dismal combination of economic stagnation and rising prices. On the other hand, low gas prices have generally coincided with economic booms. The next two years could witness the latter phenomenon, thus making Clinton a strong favorite to win the 2016 presidential election.
…
“We have a little bit of room to go before it really affects us,” he said. The city’s budget for the upcoming year tops $100 million and the state has squirreled away billions in oil revenue into funds it can tap for years to come to pay for future infrastructure, education and legacy projects. “Mainly what they’re telling us is to sit back and take a look at this thing. We were really fast-paced. We had a hard time keeping up. So we think it’s just normalizing.”
City and County managers won’t save a nickel either despite the nearly 50% drop in oil prices and looming unemployment. S-P-E-N-D-!!
“Fitch: U.S. CMBS Originators Pushing the Envelope Further”
http://www.businesswire.com/news/home/20141218005694/en/Fitch-U.S.-CMBS-Originators-Pushing-Envelope
” interest-only (IO) loans proliferate and leverage metrics deteriorate, according to Fitch Ratings in a new report.
Since launching its inaugural ‘CMBS Originators Matter’ series a little over six months ago, collateral mix and loan quality continue to show declines. “
Liquidate.
“Moody’s Affirms Ten and Downgrades Three CMBS Classes”
https://www.moodys.com/research/Moodys-Affirms-Ten-and-Downgrades-Three-CMBS-Classes-of-JPMCC–PR_315748
“The downgrade of the two pooled classes are due to the deterioration in key parameters, including Moody’s loan to value (LTV) ratio and Moody’s stressed debt service coverage ratio (DSCR),”
Deteriorating LTV? Why not just say it. Falling Prices.
“Kroll Bond Rating Agency Releases 2015 CMBS Outlook”
http://insurancenewsnet.com/oarticle/2015/01/01/kroll-bond-rating-agency-releases-2015-cmbs-outlook-a-582381.html
“Credit metrics continued to weaken as leverage climbed to new post crisis highs and debt service trended downward despite lower interest rates and the prevalent use of interest-only loan structures.”
SubPrime x10.
“Bob Martin’s best advice for folks living in the energy capital of the world? ‘The most important thing is to pay down debt,’ he said.”
That’s right. Liquidate and hold onto every dollar you’ve got. You’ll be glad you did.
It’s too late for most people. I was in a hotel a while back, and there was this house flipping show from Houston on the TV. It was as ridiculous as you would see anywhere in the country. They’ve bought into the $500k house like it’s as normal as the humidity. Now we’ll see how much leverage all these rich people have.
In Central FL the flipping game appears to be over. Some of the flips a few neighborhoods away have been on the market for a long time (1 YR). One house, overpriced by about 200k, has been empty and on the market for 2 years. When will these people understand opportunity costs?
We are seeing the same thing in the Sacramento foothills. Flippers getting into $500,000 properties, cut and paste some decorating and relisting for $750,000!
Sit….sale price reduction….sit….for rent….sit…rent reduction….sit….sale price reduction….. Going on nine months now.
The Super Bowl is coming….what will the real estate market do?
Going on nine months now.
Ouch—assuming they are paying the mortgage, that has got to leave a mark. And fools like this can’t all be operating on a cash basis, right?
“‘Nothing has changed quite yet,’ said Steve Holen, superintendent of McKenzie County Public School District No. 1. ‘There’s some nervousness, obviously. If there is a little bit of a lull, it’ll probably provide an opportunity for some of the infrastructure to get built out, and give some time for a little bit of catch-up. I don’t think anybody’s assuming that it’s just all going to go away.’”
Steve Holden is a prime example of a Free $hit adherent. “I’m going to get what I want irrespective of the circumstances because it will enlarge my ______.”
Mckenzie County, ND List Prices Plummet 9% YoY As Speculation Turns To Fear
http://www.zillow.com/mckenzie-county-nd/home-values/
Got excess empty schools and houses?
” a population of 12,000 and…a $101 million event center”
How about an extra $10,000 in public debt for each and every person? Who would like to donate a Zamboni?
^ This right here is the problem. You nail it every time.
Typical Fat Cat boom time shill. Needs to have his pension stripped. And all those involved in causing them to build a 50 million dollar high school in a town of 12,000 need to sit in a jail cell.
Ma, kids, we’re broke.
Well Honey, we’ll always have the indoor lazy river.
LOL on the lazy river….good one.
Misconduct for certain.
Temporary classrooms at 5% of the cost of the debt fueled boondoggle this guy is pimping is the answer. He can’t be trusted.
HA, what do schools cost to build? Is it still $50/sq ft like houses?
You’re getting all the schooling you’ll ever need right here Donk.
You can make a school as expensive as you want to. NY floated a bond for Smartboards that is over $1,000 per school age child. How much ft2 does one child use up?
I wasn’t asking you, Blue.
You can make a school as expensive as you want to. NY floated a bond for Smartboards that is over $1,000 per school age child. How much ft2 does one child use up?
“….You’re getting all the schooling you’ll ever need right here Donk…..”
And it’s free. $0/SF.
Of course it is not worth the cyberspace into which it is posted!
Speaking of paying inflated prices for depreciating assets and double the losses by financing….. Hello Jingle_Fraud.
hmmm…. all articles point to a good old fashion global recession.
How does an inverted yield curve look when short rates are stuck at the zero bound?
In the shape of a D that fell on its’ side. D for desperation.
U.S. 30-Year Bond Yield Lowest Since 2012 as Inflation Slows
By Susanne Walker Jan 5, 2015 6:17 AM PT
Treasuries rose, pushing the 30-year bond yield to the lowest level in more than two years, as global inflation slowed even as the Federal Reserve is on track to raise rates this year.
The difference between yields on two-year notes and 30-year bonds, known as the yield curve, narrowed to the least since January 2009 as brent crude oil fell below $55 a barrel for the first time since May 2009. German inflation slowed to the weakest in more than five years in a sign that euro-area prices have started to decline. The chances of a Fed interest-rate increase by its September meeting was at 65 percent.
“The Fed may be optimistic about inflation, but they are getting lonelier in that view,” said Jim Vogel, head of agency-debt research at FTN Financial in Memphis, Tennessee. “It’s the Fed’s current willingness to ignore the inflation downdraft.”
…
Remember the WIN buttons of the Seventies?
WIN = Whip Inflation Now?
Well, it took them a while, but apparently they worked!
“A report by the Britain-based Commodities Research Unit said that while softening in the Chinese economy was contributing to the downturn in the market, it was not the main cause. ‘A surge of low-cost supply from Australia has been the principal driver dragging prices lower,’ CRU analyst Laura Brooks said.”
Now here’s an interesting statement that reaches an interesting conclusion, which boils down to this:
The “downturn of the market” was driven by “a low cost of supply”, and not the other way around.
It wasn’t that long ago that these companies all thought China would continue to build like they have been for decades more, and they planned accordingly.
Nobody expects the end of a credit expansion.
Excellent question Whac. I was just thinking about that marker today. I am dialing back from 95% invested to 75% invested w 25% cash and putting all future cash flow into the MMF. Zero ROI, but proper hedge for frothiness…..
Oops…not sure how this post jumped one thread. My comment was in response to Whac’s question of
“How does an inverted yield curve look when short rates are stuck at the zero bound?”
“…rental prices have collapsed on older weatherboard houses from A$1,000 a week to A$200,’ he says.”
That right there is a promising sign that rents can and do decrease. Is there any chance of rents in California showing similar affordability improvements in the foreseeable future?
“Is there any chance of rents in California showing similar affordability improvements in the foreseeable future?”
Here’s one place in California where rents really dropped.
(The low rents had something to do with the lack of jobs.)
https://www.google.com/search?q=bodie+ghost+town&biw=1600&bih=775&source=lnms&tbm=isch&sa=X&ei=ZZWqVKfWPM7poATanYLwBg&ved=0CAYQ_AUoAQ
Has Apple announced the first wave of layoffs yet?
‘The value of the ruble isn’t the only thing that is vanishing in Russia. A Moscow hedge fund chief executive has disappeared, along with all the money in the firm’s accounts. That’s according to a stunning feature in The Wall Street Journal. Kim Karapetyan, 29, the youthful founder of Blackfield Capital CJSC, has disappeared, much to the dismay of his staff, which didn’t know until a group of men charged into the firm’s plush offices.’
‘But Mr. Karapetyan wasn’t in the office that day or the next, when senior executives explained to the staff of about 50 that there was no longer any money to pay their salaries, said one former senior executive and ex-employees. The executives disclosed that all the money in the company accounts — some $20 million, including investor cash — was also missing, they said. It couldn’t be determined whether investors were from Russia or other countries.’
‘No attempts to contact or find Karapetyan were successful, and he is still MIA. The company’s website brags that its “systematic investment process helps avoid human-factor, cognitive-biases, and emotional-trading errors,” but the CEO running away with all your money seems like a fairly big human error.’
‘A 70-year-old hedge fund founder has been found shot dead inside his Manhattan apartment. Police say Thomas Gilbert was shot in the head at his Beekman Place residence on the East Side. Police said Monday they were questioning his 30-year-old son, Thomas Gilbert, Jr. No charges have been filed.’
‘Police say a handgun was found near the body.’
‘The elder Gilbert founded Wainscott Capital Partners Fund in 2011. The fund has $200 million in assets and focuses on the biotech and health care industries.’
“all your money”
At least he was unbiased.
“… but the CEO running away with all your money seems like a fairly big human error.”
Or not, not an error.
‘Copper fell for a third day, extending declines to the lowest in more than four years, amid mounting concerns Greece will exit the euro-area. The euro weakened to an almost nine-year low versus the dollar as a debate on Greece’s membership of the currency union deepened a selloff driven by central-bank stimulus.’
‘Copper for delivery in three months on the London Metal Exchange fell 0.9 percent to $6,197 a metric ton by 10:36 am It reached $6,196, the lowest since June 2010, and dropped 14 percent in 2014, the biggest annual loss in three years. In New York, copper futures for March delivery declined 1 percent to $2.7885 a pound.’
“Rising worries about Chinese growth, absence of Chinese buying, supply surpluses on the horizon, strengthening dollar are the main drivers of lower prices this morning,” RBC Capital Markets said in a note today. “CTAs are selling the complex this morning, with funds rolls this week expected to trigger further sell-off,” it said, referring to commodity- trading advisers.’
‘Copper stockpiles monitored by the LME climbed 0.8 percent to 178,425 tons, the highest since May, bourse data showed today. Inventories in China tracked by the Shanghai Futures Exchange climbed for a fourth week to 111,915 tons, the highest since April, data showed Jan. 1.’
“Rising worries about Chinese growth, absence of Chinese buying…”
Ridiculous. China will be the engine of world growth for decades to come. Just ask the Australian miners. (Albuquerquedan, need some back up here bro).
Monterey County, CA List Prices Plummet 19% YoY As Inventory Balloons And Sellers Slash
http://www.zillow.com/monterey-county-ca/home-values/
‘Hong Kong Muzzling Moody’s Over China’s Troubled Kaisa’
‘Shenzhen’s targeting of the company has yet to be explained, but the attack appears to be broad-based. “Clearly, the authorities’ move is trying to paralyze the company’s entire operations in the city,” writes Haitong Securities about Kaisa’s “escalating trouble in Shenzhen.” As the South China Morning Post reports, there are persistent rumors that Chinese authorities have been investigating Kwok “even after the firm’s denial in October that he had been detained.”
‘Who warned the markets about Kaisa’s financial troubles? That would be Moody’s Investors Service, which on July 11, 2011 issued “Red Flags for Emerging-Market Companies: A Focus on China.” The report cited Kaisa and 60 other companies.’
‘And that, incredibly enough, led to Hong Kong’s Securities and Futures Commission fining Moody’s a whopping HK$23 million for releasing the critical commentary. The SFC alleges that the rating agency, by issuing the Red Flags report, breached the SFC’s code of conduct.’
Bahahahaha … no good deed goes unpunished.
“China’s model of transparency…”
It’s not bad news until it is reported. Don’t make bad news in China.
“It’s not bad news until it is reported.”
Uh, so I suppose I should expect the news that is reported in “China Daily” to never be bad?
No. Just after the fact.
“All the News That’s Fit to Print”
Where to find mortgage backed securities…..
http://goo.gl/7xqBMZ
Car sales on a tear best since 2006.
Heavy financing. Same with housing; if you have to finance it you can’t afford it.
Yep. Subprime AutoNation. Dig a little deeper into the trends by the way. It’s hopeful if you need a vehicle in the next 36 months. Analysts on bloomberg are forecasting a 25% decline used sales volume. Of course they understate by half.
My truck has 250,000 miles on it. I’ll be ready.
The oilburner has 210k on her but I can squeeze another 200k out it. The gasser at 150k is getting tired and lazy but very roadworthy.
“My truck has 250,000 miles on it. I’ll be ready.”
Yep, could use another economy Toyota over here.
More bloomibergi:
Drivers Will Pay Up to $1,499 for Tech Features, Study Says
http://www.bloomberg.com/news/2015-01-05/drivers-will-pay-up-to-1-499-for-high-tech-features-study-says.html
Main upshot: drivers basically want a touch-screen dashboard with phonelike functions. Great. Now they can stream all their favorite music and watch all their favorite shows while they drift into my lane. IMO, insurance companies ought to give a price break to drivers who have plain-jane cars.
What *I* want is a short-range hacker/transmitter which allows me to speak into a microphone and project it into another car’s sound system, so that I can cuss them out when they tailgate or cut me off. Now that would be worth $1499.
I’ve found that turning on my windshield wipers works pretty good for tailgaters. God forbid they get water stains on their shiny chrome
I just slow gradually and hug the shoulder, encouraging them to pass. I used to signal with brake lights but I realized that chances were rather high that the anxious driver behind me has a 30% probability of PMS or some other mind altering situation and would probably rather see me die than lose a second on their trip to whatever.
Saw gas for $1.92 in Longmont, CO this morning.
How low will it go?
$1.81 in New Orleans last week!
$1.699 in greater St. Louis area last week (i.e. St. Charles)
Houston accountant Bob Martin’s best advice for folks living in the energy capital of the world? ‘The most important thing is to pay down debt,’ he said.
Brilliant chap. “Always, ALWAYS, pay off debt during good times”.
Keynesian talk!
“Debt is dumb”
Ramsey talk!
Crude Craters Under $50/bbl
http://www.cnbc.com/id/102308102
Excellent news today! Lower prices!
Hmmm…..seems they have finally caught up with HBB - only took years to do so.
WSJ’s Clements: Buy a Home to Live in, Not as an Investment
Friday, 02 Jan 2015 06:20 AM
By Dan Weil
Nobel laureate economist Robert Shiller of Yale University has repeatedly pointed out that if you’re going to buy a house, it should be for a place to live, not as an investment.
Wall Street Journal columnist Jonathan Clements makes the same point. “The words ‘home’ and ‘investment’ don’t belong in the same sentence,” he writes.
That doesn’t mean he opposes home ownership. “The tax breaks are impressive,” Clements says. “Home ownership forces us to save: with each mortgage payment, we whittle down the loan balance, so eventually we own a valuable asset free and clear. Most important, a home provides us with a place to live.”
But don’t expect much in terms of price appreciation. Freddie Mac calculates that home prices have advanced just 3.7 percent annually over the last 30 years, not much more than the 2.8 percent inflation rate.
Add in the costs of buying, owning and selling a home and you could be talking a miniscule return, Clements notes.
But renting is turning into an expensive proposition.
“Over the past 14 years, rents have grown at twice the pace of income due to weak income growth, burgeoning rental demand and insufficient growth in the supply of rental housing,” Zillow Chief Economist Stan Humphries tells CNBC.
“Next year, we expect rents to rise even faster than home values, meaning that another increase in total rent paid similar to that seen this year isn’t out of the question. In fact, it’s probable.”
Yet rents are still only half the monthly cost on a square foot basis.
“Next year, we expect rents to rise even faster than home values, meaning that another increase in total rent paid similar to that seen this year isn’t out of the question. In fact, it’s probable.”
Rising rents in a deflating world not even sure how that’s possible?
The great recession killed the supply chain of home building ??
I’m not so sure about rising rents in an environment with weak income growth either. And the roommate model is getting close to maxing out.
It’s possible in places like SFO and Seattle where too many highly-paid techies are competing for the same limited supply of close-in apartments and SFR rentals.
My neighbor works for several apartment complexes and the recent rent increases are just staggering.
Well… Not really.
Seattle, WA Rental Rates Sink 9% YoY
http://www.zillow.com/seattle-wa-98105/home-values/
Ha, ha, ha, HA! You keep arguing with people about their real experiences in their markets…..based on your Zillow fantasies. You are so misinformed and it detracts from the valuable parts of your message. I hope you can improve your message by lowing the noise.
Data Jingle_Fraud data.
“Home ownership forces us to save: with each mortgage payment, we whittle down the loan balance, so eventually we own a valuable asset free and clear.”
And then along comes that economic genius named David Lereah who convinces millions - MILLIONS - of people that:
“If you paid your mortgage off, it means you probably did not manage your funds efficiently over the years. It’s as if you had 500,000 dollar bills stuffed in your mattress.”
“home ownership. “The tax breaks are impressive,”
Doesn’t he mean that the tax “bills” are impressive?
YMMV. In some places they are definitely horrific.
“Home ownership forces us to save: with each mortgage payment, we whittle down the loan balance, so eventually we own a valuable asset free and clear. Most important, a home provides us with a place to live.”
What percentage of homeowners that have bought within the last ten years used a low-interest, fixed-rate loan and didn’t refinance into another loan of the same term? A minority for certain. The others are paddling upstream
I did!
+2. Went from 5.25% FHA to 3.25% conventional. Saved $8k a year on $400,000 loan.
And both hopelessly underwater.
135-foot water slide and an indoor lazy river.”
new peak indicator
gotta lazy river w that?
most here are market observers
was 2014 oil product that parabolic ?
http://www.eia.gov/dnav/pet/pet_crd_crpdn_adc_mbblpd_a.htm
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS2&f=A
It appears the recent episode featured the most rapid rate of increase in U.S. output over a protracted period of time in the history of U.S. oil production.
Wow, check out North Dakota:
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPND2&f=A
Or Texas:
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPTX2&f=A
Any wonder why Rick Perry was such a great “job creator”? He can kiss his presidential hopes goodbye with what’s coming.
He already kissed his goodbye when he opened his mouth and auto-inserted his foot. He is as dumb as Bush junior.
Interesting that the inflection point in the graph is 2007 - right about the time that the finance markets blew up.