Bits Bucket for March 23, 2015
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Any chance at this point the Saudis will use a production cut to push oil prices back up?
Oil was cut in half and it has had practically no effect on the economy. Extend.and.Pretend.
Don’t expect the world to change overnight just because a binge ended. It takes time. Meanwhile, take that extra percent of your pay that is now free and work on paying off debt or something.
Here, lumber is off like 50%. Now you can build that garden shed.
http://www.randomlengths.com/woodwire/rl-lbr-pnl/
Copper is off too, so maybe you can string some lights in the shed.
We’ve been through this before. Oil price is back to long term trend (almost). Last time it went below significantly and stayed there for a couple decades. Last time though, the world wasn’t in the debt trap that it is now.
Lumber prices are not off 50% at the retail level. Not even close.
Hopefully reality will settle in at the lumber yard.
Oil slips close to $55 as Saudi output rises to near record
By Ron Bousso
LONDON Mon Mar 23, 2015 8:25am EDT
Pumpjacks taken out of production temporarily stand idle at a Hess site while new wells are fracked near Williston, North Dakota November 12, 2014. REUTERS/Andrew Cullen
(Reuters) - Oil prices declined on Monday, holding near $55 a barrel after Saudi Arabia indicated it was now pumping near a record high of 10 million barrels per day, adding to concerns of global oversupply.
Saudi Arabia has stood firm on output, saying it would only consider cutting it if other producers outside OPEC also joined.
Brent crude oil futures were trading down 21 cents at $55.11 a barrel at 1217 GMT, after hitting a low of $54.12. U.S. WTI crude was down 55 cents at $46.02.
Saudi oil minister Ali al Naimi also said the kingdom was now pumping around 10 million barrels per day (bpd), which could indicate an increase of 350,000 bpd over its February production.
Analysts at Barclays forecast on Monday that if OPEC production held near current levels of near 30 million bpd, the market surplus would expand from 900,000 bpd to 1.3 million bpd.
Oil prices have see-sawed, weighed down by concerns of oversupply but boosted by swings in the strength of U.S. dollar ahead of the expected end of years of zero interest rate policy in the United States later this year.
On Monday, oil prices pared some of their earlier losses after the dollar renewed its slide.
“In the past 15 years, the global economy was defined by rising commodity prices, zero interest rate policy, and a weak USD. This cycle has now gone into reverse with a decelerating industrial economy in China and the rise of U.S. shale,” Bank of America Merrill Lynch said in a report.
“A combination of a strong dollar, higher interest rates and subdued growth may keep commodity prices in check in 2015,” it added.
…
The Saudis have more than 220 rigs drilling just to maintain production levels, they use to be able to raise production by several million barrels almost as quickly as turning on a light switch. Matthew Simmons has been vindicated, they were and are lying about their reserves. It does not bode well for the consumers of oil.
“It does not bode well for the consumers of oil.”
Falling crude and fuel prices. What’s not to like?
Demand might be low, but it will never go away. Dan is invoking Peak Oil — or at least higher prices when the market share shifts to expensive fracking. But keep eating those Cheetos and you won’t have to worry about peak oil in your lifetime.
hmmm…. who is it that is suggesting demand will go away?
Donk.
Oxide, he will not have to worry about peak gas. He will be methane self sufficient.
Falling crude prices… falling housing prices. Both at grossly inflated levels.
http://www.reuters.com/article/2015/03/20/us-saudi-oil-drilling-idUSKBN0MG26420150320
Excerpt from link that will soon post the article claims 212 but I have seen reports of over 220, this is what you have to do when your best oil fields have reached terminal decline. The Saudis influence in the world is largely determined by their claimed ability to supply the world with increase production at will, however the truth is just maintaining production is a challenge and all those new wells are increasing the cost of production in the Kingdom:
Industry sources and analysts say the OPEC kingpin is looking beyond the halving of global oil prices since June 2014 to a time when crude could again be in short supply.
Riyadh is therefore keen to preserve what is known as its spare capacity - the kingdom’s unique ability to raise oil output quickly at any given moment.
But to achieve that, Saudi Arabia has to drill much more than in the past, after boosting output to record levels to compensate for global supply outages in the past four years.
“The Saudis are probably worried about everyone else reducing capex as a result of low oil prices and about non-OPEC output falling off a cliff at some point. We all know that supply disruptions are unpredictable but they are certain,” said Gary Ross, executive chairman of New York oil consultancy PIRA.
“The increase in Saudi rig numbers is like a signal to the industry - let’s be rational. We will need supply growth in the future.”
State oil giant Saudi Aramco used a record-high 210 oil and gas rigs in 2014, up from around 150 in 2013, 140 in 2012 and some 100 in 2011, according to previous industry estimates.
Amin Nasser, Aramco’s senior vice-president for upstream operations, said this month his firm had yet to decide whether to increase the rig number in 2015 from the 212 currently in use.
But data shows the numbers are still rising.
Excluding non-U.S.-registered rigs such as Chinese or Russian, February 2015 saw a total Saudi rig count of 155, up from 150 in January and 146 in December, according to data from OPEC and U.S. oil services company Baker Hughes. Since 2010, the number of U.S.-registered rigs has doubled from 67.
Sadad al-Husseini, a former senior executive at Aramco and now an energy consultant, said the rise in the Saudi oil rig count had been evolving over a long period.
“You need to drill more wells if you are producing 10 million barrels per day and maintaining your spare capacity,” he said.
“It is also a natural phenomenon in the oil business, that the more you produce, the more you deplete your reserves and the more rapidly your field capacity declines. You need to drill more wells more frequently, simply to maintain production capacity.”
Falling prices Dan. Falling prices.
Demand for crude oil imports to China is rolling over as their storage tops out and consumption falls.
http://www.reuters.com/article/2015/03/18/us-asia-oil-markets-idUSKBN0ME0TQ20150318
Extracting Saudi & Kuaiti oil cheaply is probably one of the best long term strategic options the US has. Keep our shale oil intact, get the saudi oil cheap, when they run dry, terrorist funding will evaporate, and the US strategic energy reserve is still available for use at home… Everyone should be touting this positive development, deflation or impacts to home pale in comparison to the long term benefits.
“It does not bode well for the consumers of oil.”
Is this you?
http://picpaste.com/black_pimp-g7cxgBfL.jpg
^
That’s Dan.
I didn’t realize that he is an African American, like Obama. This certainly puts matters into perspective.
End-game for Greek socialism and crony capitalism as they are about to run out of other people’s money.
http://www.businessinsider.com/report-greeces-government-only-has-two-weeks-until-the-money-runs-out-2015-3
I’ve heard it all before but never see any evidence of the money running out.
Tell me about it. It just goes onandonandon. The never-ending story. I’m really tired of hearing about it.
Except debt is the “nothing” and you can’t just give a kid a name to make it go away.
Seems they’ve made it go away pretty good. Buried, hidden, papered over, and ignored. Stock market all time high.
Isn’t this the point in the extend-and-pretend cycle when deus ex machina bailouts materialize?
End-game for Greek socialism and crony capitalism as they are about to run out of other people’s money.
They’ll just print more.
End-game for Greek socialism and crony capitalism as they are about to run out of other people’s money.
crony capitalism=corruption
and corruption NEVER ‘runs out of money’. the only way corruption ends, is when it runs out of political or legislative power. and the only way that happens is to limit government power.
socialism runs out of money, but not corruption.
How many more times can the money “run out?” I mean, why would I even believe this tripe? I heard the money was running out YEARS AGO!
Just shows you the power of the press - if you can get it parroting your bull. Greece only needs to borrow more money to pay the Europeans - not for their own use. So the Euros say the Greeks are greedy - wow - that really is calling the kettle black.
I hope the Greeks say NO on the 9th. No more. Period. You have already received all of your capital back. Take a hike.
There will be fireworks but those bankers have zero leverage. And they know it.
ft dot com
March 20, 2015 6:45 pm
Germans’ unhealthy obsession with a Greek ‘Stinkefinger’
Stefan Wagstyl — Berlin
The picture is claimed to have been taken at a conference in 2013
The big Greek crisis question consuming Germany this week was not about debt or financial restructuring — but the left middle finger of Yanis Varoufakis.
Did the radical Greek finance minister raise the offending digit in an obscene gesture aimed at Berlin? Or did he not? Germans are talking of little else — in a debate fuelled by conflicting claims and commentaries that verge on the absurd.
The saga raises questions about digital media, satire and Germans’ view of their place in the world. But mostly it is a tale about a Teutonic obsession with Mr Varoufakis, 53, a motorbike-riding Marxist who prefers jeans and leathers to a suit and tie; the finance minister of a penniless country who has the temerity to challenge Berlin.
“He’s a radical punk,” says Peter Littger, a social commentator for Spiegel magazine. “He is not like a typical politician. It’s not that we like him or don’t like him. We are intrigued.”
That intrigue boiled over last Sunday when Günther Jauch, one of Germany’s top television presenters, played a clip from a 2013 conference in Croatia while hosting Mr Varoufakis on his show.
In the video, Mr Varoufakis argues that Greece should default. “Stick the finger to Germany and say . . . you have to solve the problem by yourself,” he says, while raising his left middle finger.
Mr Varoufakis promptly denied flashing what Germans call the ‘Stinkefinger’ and claimed the video had been doctored. Mr Jauch’s broadcaster stood by the video.
But then a German satirist intervened: Jan Böhmermann, 34, a rising comedy star, claimed on his Tuesday television show that he had painstakingly faked the Varoufakis finger. He even showed video clips purporting to detail his forgery.
A grateful Mr Varoufakis proclaimed his innocence — and demanded an apology from Mr Jauch “for having used a doctored video to silence a conciliatory Greek voice”.
But the story took another twist: Mr Böhmermann’s network subsequently reminded viewers his programme was satire, implying the doctoring claim was not serious. And Skripta, the Croatian video company, which made the 2013 conference film, posted on YouTube what it said was the original — complete with a Varoufakis Stinkefinger.
…
when are the experts going to realize they have sucked most of the money out of retail and go short again? there is a lot of hype out there for sure.
Region VIII
http://www.picpaste.com/IMG_20150322_124934_632-b0ttHrBY.jpg
‘It’s full-on euphoria. The Dow Jones Industrial Average is back over 18,000. The Nasdaq Composite is above 5,000. The Russell 2000 is pushing to new record highs. Overseas, Japan’s Nikkei 225 Composite, which dipped below 17,000 early in the year, took about a month to surge from 18,000 to 19,000 and is now rapidly approaching the 20,000 level — heights that haven’t been seen since 2000. Germany’s DAX recently traded above 12,000 for the first time and is up nearly 30 percent from the lows set earlier this year.’
‘The same thing is happening in China. The Shanghai Composite Index is up 16 percent from its February lows.’
‘The common theme: Seven years after the financial crisis — created in the wake of a housing bubble fueled by low interest rates — global central bankers keep doling out stimulus.’
‘If the Fed will be slow in tightening, other major central banks are just ramping up their stimulus efforts, from a new sovereign bond-buying program by the European Central Bank to chatter that the Bank of Japan could start buying individual stocks to rate cuts by the People’s Bank of China. Overall, there have been 25 interest rate cuts so far this year.’
‘If you wanted confirmation that it’s all about the central banks now — and not about fundamentals like earnings and economic growth — consider the chart below. It shows how stocks globally have disconnected from earnings growth, fueled by an expansion of price-to-earnings multiples.’
‘Consider also that economic growth here at home has stalled as the Atlanta Fed’s GDPNow Q1 growth estimate has collapsed to just 0.3 percent while the Citigroup Economic Surprise Index, shown below, has fallen to levels not seen since early 2011 just before the start of the bull market’s worst correction to date: A 21.6 percent peak-to-trough decline in the S&P 500.’
‘Ed Yardeni of Yardeni Research has been telling clients to prepare for an “Irrational Exuberance meltup scenario” thanks, once again, to the work of central bank officials. Yellen is the star now as U.S. stocks haven’t participated in the rises already seen across Asia and Europe. That’s set to change.’
‘Yardeni admitted last week that this is all a bit ridiculous, and probably shouldn’t be happening, but for now it isn’t necessarily a bad thing. “This is not about investing, this is all about the central bankers,” he clarified. “These markets are all rigged, and I don’t say that critically, I just say that factually.”
http://finance.yahoo.com/news/forget-fundamentals-market-just-one-101500022.html
“These markets are all rigged, and I don’t say that critically, I just say that factually.”
More specifically, prices are rigged. Don’t borrow.
But if the global central banking cartel is actively involved in a coordinated effort to write down the value of western nation fiat currencies, wouldn’t it make perfectly good sense to borrow money and buy hard assets with the future expectation that the real value of your future debt payments will be considerably lower than their nominal value?
Or do you assume that the effort to offset deflationary pressures will fail, due to asset price bubble formation which was driven by rational expectations for future currency devaluation?
With prices falling all over the place, it already failed.
Stay out of debt. Assets are still grossly overpriced and in oversupply. If you like to carry things on your back instead of cash in your pocket, wait for despair.
You must remember that the US is the consumer market driver. It CAN stand on it’s own - the only one that can.
Yellen wouldn’t be taking any chances. She has to move before this global currency nonsense really gets out of hand.
If she moves interest rates up there will be a flood of foreign currency into the US which will drive the USD up - and their currencies down. Their workers will not make enough for any extras.
The US economy is such a well developed mixed one that it could easily handle the short term increased competition.
Only when someone shows some leadership guts will this mess turn around.
“leadership guts”
Without serious reform, we are not expecting to see that.
Exactly. WAIT.
Is it oversimplifying matters to observe that there is a coordinated effort underway by the global central banking cartel to transfer wealth from savers in western fiat currencies to asset owners whose wealth is denominated in said currencies?
ft dot com > GlobalEconomy >
US Economy
March 23, 2015 4:04 pm
Raise rates or face ‘devastating’ bubbles, says Fed official
By Chris Giles and Ferdinando Giugliano in London
The US risks inflating asset price bubbles with “devastating consequences” if it leaves interest rates at zero, according to a senior Federal Reserve official.
James Bullard, head of the Reserve Bank of St Louis, told the Financial Times on Monday the Fed “should get on with normalisation” as soon as possible so that it is not forced to raise rates more aggressively later causing significant market volatility.
The policy maker’s concerns underscore the nervousness among many central bankers about interest rates remaining at rock bottom rates even as unemployment in the US and UK returns to normal levels.
Mr Bullard, who is not currently a voting member of the Federal Open Market Committee, said the die was already cast and the US would have “super easy” monetary policy even as unemployment dropped further. The unemployment rate dipped to 5.5 per cent in February, its lowest rate since 2008, and was poised to go below 5 per cent by the third quarter of the year, Mr Bullard said.
Recalling the tech bubble in the 1990s and the housing bubble of the 2000s, he said: “Zero [interest rates] is too low in that kind of environment. I wouldn’t be comfortable with that. A zero rate would feed into an asset price bubble”.
…
News flash: Strong dollar is hammering profits at large US multinationals which are overrepresented in headline stock market indexes like DJIA and the S&P500.
Yet these indexes are near or at all-time highs.
What gives?
This is a Drudge Report link:
http://www.houstonchronicle.com/news/politics/us/article/Ted-Cruz-to-announce-presidential-bid-Monday-6150894.php
Happy Monday
See also:
http://www.washingtonpost.com/politics/republicans-rally-to-scott-walkers-call-believing-hes-a-scrappy-survivor/2015/03/22/a9068e9a-cef9-11e4-a2a7-9517a3a70506_story.html
Rallying the base
See also:
Jerry Brown: Ted Cruz ‘absolutely unfit to be running for office’
By David Cohen
3/22/15 4:01 PM EDT
Updated 3/23/15 12:13 AM EDT
…
Heh, Jerry Brown says Cruz is unfit? I’m not a Cruz fan, but Jerry Brown opining on the fitness of anyone to hold office is a real thigh-slapper.
breaking news on bloomberg: cruz’s wife heidi to take unpaid leave from goldman sachs
Future Secretary of the Treasury?
+1
Luvvin these golddigger hubbies. Cindy McCain would have been outstanding at ATF.
Bloomberg reporting today that “median price of an existing home rose to $202,600 from $188,400 in February 2014″
I seem to recall a runup at the beginning of last year through beginning of summer, then it started going down. Is February the last month this comparison looks good?
Not Bloomberg reported, NAR reported, Bloomberg rereported.
Did they sell a single house this year?
With the Fed’s rate hike postponement, we can expect the flow of hot money into real estate to continue driving up prices to unaffordable heights.
Economic Report
Home-price growth is squeezing would-be buyers
Published: Mar 23, 2015 10:54 a.m. ET
By Greg Robb
Senior economics reporter
Bloomberg
Rising prices are making it difficult for would-be homeowners
WASHINGTON (MarketWatch) — The price of buying and renting a home are rising, squeezing consumers and dampening the housing market.
The median sales price of used homes hit $202,600 in February, up 7.5% from the year-earlier period. This is the largest increase in a year and is “unhealthy” said Lawrence Yun, chief economist of the National Association of Realtors.
While higher prices are good for homeowners, “for people who want to buy a home it is becoming more difficult,” Yun said.
Wages are only rising 2%, he noted.
Potential first time buyers on the sidelines, and renters are also being squeezed as rents are rising at a 3.5% rate, Yun noted.
Given the rise in rents, these buyers are unable to save for down payments, Yun noted.
The share of first-time home buyers rose marginally to 29% from 28% in February, well below the 40% level that economists say is normal.
…
Note also that MarketWatch has not allowed comments on the article.
They are just as much a harem of housing whores as city-data dot com.
“Given the rise in rents, these buyers are unable to save for down payments,”
I suspect that’s not the whole story. Many of those renters can only afford the rent by shacking up with roommates. Even with a down payment, they can’t make the monthly nut by themselves. And they know well enough NOT to buy a house with a ring-less roommate.
Yet they can afford to pay double the rent and sign up for a mortgage?
You’re not making much sense these days Donk.
I don’t think Yun’s math is very good. They say (preliminary) Feb median is $202K and 2014 yearly median was $208K. Yet they say this is an 8% increase over “last year”. Realtors.
http://www.realtor.org/sites/default/files/reports/2015/embargoes/ehs-03-23/ehs-02-2015-breakouts-of-single-family-condo-and-co-op-2015-03-23.pdf
Half of Americans can’t afford their house
Published: Jan 31, 2015 10:16 a.m. ET
By Quentin Fottrell
Personal finance reporter
As the housing market slowly recovers, a majority of homeowners and renters are finding it hard to meet rising rents and mortgage payments, new research finds.
Over half of Americans (52%) have had to make at least one major sacrifice in order to cover their rent or mortgage over the last three years, according to the “How Housing Matters Survey,” which was commissioned by the nonprofit John D. and Catherine T. MacArthur Foundation and carried out by Hart Research Associates. These sacrifices include getting a second job, deferring saving for retirement, cutting back on health care, running up credit card debt, or even moving to a less safe neighborhood or one with worse schools.
“Affordability issues are real and a major hurdle,” says Lawrence Yun, chief economist at the National Association of Realtors, an industry group. Home prices have increased 20% over the past two years while wages have barely gone up, he says. “Only by adding more new supply, via housing starts, can home prices be tamed,” Yun adds. In fact, construction of housing units has averaged around 1.5 million a year for the past five decades, he says, but it’s likely to be less than 1 million in 2014.
What’s more, at least 15% of American homeowners (or residents of 78 counties across the country) were living in housing markets where the monthly mortgage payment on a median-priced home requires more than 30% of the monthly median household income — long considered the maximum for rent/mortgage repayments. Housing costs above that threshold are “unaffordable by historic standards,” says Daren Blomquist, vice president at real estate data firm RealtyTrac. In New York county/Manhattan, mortgage payments represent 77% of the median income and in San Francisco County represents 70%.
Although mortgage rates are still quite low, down payments, poor credit and tighter lending standards remain three of the biggest hurdles for buying a home, especially among young people, Blomquist says. “The slow jobs recovery for young adults has made it harder for them to save and to get a mortgage.” Some 84% of young people are delaying major life decisions due to the poor economy, according to a 2013 survey by Generation Opportunity, a nonprofit think tank based in Arlington, Va.
Some people also appear to be cooling on one facet of the American dream. About 43% of respondents in the “How Housing Matters Survey” say owning a home is no longer “an excellent long-term investment and one of the best ways for people to build wealth and assets,” and over half say buying a home has become less appealing. Although 70% of renters aspire to own a home, some 58% believe that “renters can be just as successful as owners at achieving the American dream.”
But they’re still suffering the aftershocks of the property bust, experts say. In the years after the recession of 2008, more than 7.5 million homeowners lost their home to foreclosure or short sale and about 9 million more homeowners are still underwater and owe more than their property is worth, Blomquist says. “If one looks at the last seven years as a predictor of housing market behavior in the future, it certainly should give one pause about whether buying a home is a good investment or not,” he adds.
…
If you spend more than $45/night to put a roof over ‘er head for a family of 4, yer OVERPAYING!
That’s a crapload of money for a cozy roof over yer head. More than half of what most people earn. I’ve got mine down to less than $5/night, and it is quite luxurious. It takes making decisions. If I had done this 30 years ago, I could have retired 20 years ago.
Get your wallets out lion realturds. That goes for you too Lola and Liberace. Get your purses out.
http://thehousingbubbleblog.com/?p=8920
Region VIII
“Metro Denver has become the first major city in the mountain West — and one of only four nationwide — “to fully close the book on the housing crisis” by seeing housing prices exceed pre-recession levels.
http://www.bizjournals.com/denver/news/2015/03/20/denver-has-closed-the-book-on-housing-slump-says.html
Amy Hoak couldn’t have written this any better
“…by seeing housing prices exceed pre-recession levels.”
Doesn’t that bring them back to mania price levels?
Not all markets had the same level of mania.
The Shiller indices are set at 100 for every market in January 2000.
Here are the bubble-era peaks of each of the Shiller 20 markets.
Phoenix: 227.42
Los Angeles: 273.94
San Diego: 250.34
SF: 218.37
Denver: 140.28
Washington: 251.07
Miami: 280.87
Tampa: 238.09
Atlanta: 136.47
Chicago: 168.6
Boston: 182.45
Detroit: 127.05
Minneapolis: 171.12
Charlotte: 135.88
Vegas: 234.78
NY: 215.83
Cleveland: 123.49
Portland: 186.51
Dallas: 126.47
Seattle: 192.30
In other words, Denver exceeding peak values, means something entirely different than Vegas exceeding peak values (Vegas is at 137 currently–still WAY off the peak)–Denver had a much lower bar. From January 2000 until today, Denver’s home prices have gone up by about 3.1% per year.
And considering prices were already inflated 100%, it’s good to know prices have that much further to fall, irrespective of location.
“Metro Denver has become the first major city in the mountain West — and one of only four nationwide — “to fully close the book on the housing crisis” by seeing housing prices exceed pre-recession levels.
We had some visitors last week from Beijing and on Thursday we went out to dinner with then to a fru-fru Neapolitan style pizzeria in a place in Broomfield in a nabe called “Arista”
http://www.aristabroomfield.com/
Anywho, as we were leaving I asked offhandedly how much it cost to rent there. I was told that 1 bedroom units started at $1600 a month.
We also had two colleagues who were visiting from the Santa Clara site. Just as I was saying “whoa, that much?” they marveled at how cheap that was and that you would pay $3000 or more in Santa Clara.
from that website’s ‘about us’ page:
‘the projected influx of over 90,000 new residents to the primary and secondary trade areas over the next decade is expected to generate demand for over 2.5 million additional square feet of retail and leisure floor space during this period.’
because route 36 needs even more traffic, lolz
Because everyone wants to be in, or at least near to Boulder. The Santa Clarans would hang out there after the workday was done. The Beijingers? They went to the mall and CostCo.
The Wall Street Journal
Flood of cash streaming out of the eurozone
Published: Mar 23, 2015 8:01 a.m. ET
Goes to the dollar, currencies of smaller countries
More cash is flowing out of the eurozone to buy foreign stocks and bonds than is coming in.
By Tommy Stubbington
A major shift in the flow of money around the globe is driving down the euro at a rapid clip, boosting the U.S. dollar and leaving smaller countries to struggle with the consequence of an extraordinary flood.
A wave of cash is leaving the eurozone, where returns on safe assets are infinitesimal, if they are positive at all, and headed to the U.S. and other refuges such as Denmark and Switzerland.
Europe’s common currency has fallen 22% against the dollar in less than a year, from $1.39 to $1.08. The euro EURUSD, +0.79% touched a 12-year low of less than $1.05 this month. The European Central Bank is holding interest rates, while the U.S. Federal Reserve is looking to raise them — a combination that pushes the euro down against the dollar.
But the fall, many analysts said, has been exacerbated by the willingness of big investors to move their assets out of euros, not just by speculators placing bets that the euro will fall. The diverging paths of European and U.S. monetary policy have been a catalyst for European savers and investors to reallocate their portfolios away from Europe and into the U.S. in search of returns.
Big central banks appear to be following suit, with China and the oil-rich Middle Eastern countries that had poured some of their foreign reserves into euros changing course.
Since the ECB brought in negative deposit rates in June, more cash has flowed out of the eurozone to buy foreign stocks and bonds than has flowed in, ECB data show. Recently, a steady trickle has become a torrent. In the final quarter of 2014, the gap was €124.4 billion ($134.35 billion).
…
Most renters are not ready (or willing) to buy
Published: Mar 21, 2015 8:17 a.m. ET
By Quentin Fottrell
Personal finance reporter
The rent may be too damn high, but it’s not enough to turn most renters into buyers.
The gap between rental costs and household income is widening to “unsustainable levels” in many parts of the country, new research published Monday by the National Association of Realtors found, “and the situation could worsen unless new home construction meaningfully rises.” In the last five years, a typical rent rose 15% while the income of renters grew by only 11%, the study found. The top markets where renters have seen the highest increase in rents since 2009 are New York (51%), Seattle, (32%), San Jose, Calif., (26%), Denver, (24%) and St. Louis. (22%).
“Many of the metro areas that have experienced the highest rent increases are popular to millennials because of their employment opportunities,” Lawrence Yun, NAR’s chief economist said in a statement. “With a stronger economy and labor market, it’s critical to increase housing starts for entry-level buyers or else many will face affordability issues if their incomes aren’t compensating for the gains in home prices.”
But most renters are reluctant to buy. Only 12% of current renters say they plan to buy a home within the next year, according to the latest “Housing Confidence Index” published last week by real-estate company Zillow, although this was up 25% on the previous year. On a scale of 1 to 100, with a reading of more than 50 indicating general confidence, the housing confidence index rose to 70.6 in January 2015, up 4.4 points over the previous year.
Zillow polled more than 10,000 households about housing market conditions, expectations for the future and their attitudes toward homeownership across 20 of the large metro areas.
What people say they would like to do — and what they actually do — are two different things. “While the increase in confidence among renters is heartening,” Zillow chief economist Stan Humphries said that it’s important to take a reality check. Among renters aged 18 to 34, 66.2% said owning a home was the best long-term investment, up from 61.4% last year. “Not all renters who want to buy this year will be successful,” Humphries says. “Saving a down payment, qualifying for a mortgage and finding an affordable home to buy all remain formidable challenges for many.”
And some cities are proving more popular for would-be buyers than others, Zillow found: Of the 5.2 million renters who say they would like to buy within the next year, there were an estimated 241,562 in the New York and Northern New Jersey metro area, 225,821 in Dallas, 199,146 in Los Angeles, 161,052 in Miami, and 149,744 in Chicago. But there were only 25,411 in San Jose, Calif., 31,117 in Las Vegas, and 34,898 in Boston. And renting isn’t cheap: U.S. renters paid around $441 billion last year in rent in the 25 largest metro areas, up 4.9% on the previous year.
One reason for renters staying put: Housing construction has been slow and has, for the most part, not addressed the problem of low inventory (and choice) for buyers. U.S. housing starts decreased by 2% in January from the previous month to a seasonally adjusted annual rate of 1.065 million, the U.S. Commerce Department announced last month, and applications for building permits also declined by 0.7%, indicating that this situation is unlikely to immediately change.
…
first time house buyers have some of the most boring lives of anybody i know
the house becomes their whole life, their personality, it’s so pathetic
Weekends wasted mowing lawns and repairing roofs are a tragedy.
People with mortgages can’t afford to go here:
http://www.picpaste.com/IMG_20150322_122422_319-kAyEuifw.jpg
Which with the buy one get one coupon an adult single day lift ticket is only $34.50, but broke @ss loanowners can’t even afford that
I know plenty of “loan owners” who have season ski passes (and the fancy Subaru or SUV to get there) and season tickets for the Broncos, Rockies, Nuggets, Avs, etc.
What most of those people don’t have: kids.
Which simply means they’re deeper in debt.
That’s the location of the highest elevation Starbucks Coffee location on Earth, BTW
Subaru - fancy.
Lol. That’s just silly.
Exactly.
With rental rates half the cost of buying the same property at current asking prices, why wouldn’t you rent?
I’m getting a full season pass at Loveland next year, that also includes three days at Monarch, three days at Crested Butte, three days at Purgatory, and one day (unguided) at Silverton
People with mortgages never get to do that, their whole life becomes the movie “The Money Pit” but with double the costs and none of the laughs
With rental rates half the cost of buying the same property at current asking prices, why wouldn’t you rent?
Because they are not on average?
United States Home Prices & Values
Zillow Home Value Index
$178,500
http://www.zillow.com/home-values/
The median home value in the United States is $178,500. United States home values have gone up 5.4% over the past year and Zillow predicts they will rise 1.9% within the next year. The median list price per square foot in the United States is $118. The median price of homes currently listed in the United States is $210,000 while the median price of homes that sold is $202,150. The median rent price in the United States is $1,475.
The rent may be too damn high, but it’s not enough to turn most renters into buyers.
Even if it were to cost less to buy, you still have to deal with getting stucco. Of course for now no one (at least in Denver) believes that they will get stucco.
Washington just dipped into retirement savings to fund itself
Our government is insolvent and can only stay afloat through further debt
by Filip Karinja | Bitch Gold Group | March 23, 2015
You know things are getting bad when your government begins to stick its hand into retirement accounts just so that it can remain solvent for a few more months.
With the debt limit about to come back into full swing at a staggering $18.1 trillion this week, Treasury Secretary Jack Lew has undertaken drastic measures to kick the can down the road until later this year.
One such plan to fund the government includes raiding the Thrift Savings Plan (TSP), a 401(k)-style retirement savings plan set up for federal employees.
Specifically, the Treasury wants to go after the G Fund, the largest fund in the plan, which contains Treasury securities that help to finance the national debt. As of last month, those securities in the G Fund make up $193.3 billion of the $451.7 billion of investments in the TSP.
According to Lew, the government currently has $25 million left to spend before it breaches the imposed limit without these actions. Hence he’s urging Congress to fill the purse:
“I respectfully urge Congress to protect the full faith and credit of the United States by acting to increase the statutory debt limit as soon as possible,” Lew wrote in a letter.
So what happens come November when these ‘temporary’ measures leave us facing the precipice of the debt ceiling once again? Who is going to have their money taken next?
These proposals by the Treasury Secretary are no more than vain efforts to delay dealing with the giant elephant in the room: There is no plan in place to deal with the underlying cause of this nation’s rampaging debt – a debt that continues to skyrocket with each passing year.
The fact of the matter is that our government is insolvent and can only stay afloat through further debt creation, or, in this case, stealing from whatever it can get its hands on. Right now, it has found its (temporary) solution in the retirement accounts of government employees.
Isn’t this SOP?
They’ve been borrowing the SS surplus for decades.
Also, saying that it’s “insolvent” when the issue really is the self imposed debt ceiling is being disingenuous. The day FedGov can’t pay the interest due on the debt is the day it will be “insolvent”, and thanks to low interest rates that day is, for the time being, far, far away.
SS doesn’t work.
On March 16, 2011, Senator Tom Coburn (R-OK) uttered the following words during a Senate speech:
“Congresses under both Republican and Democrat control, both Republican and Democrat presidents, have stolen money from social security and spent it. The money’s gone. It’s been used for another purpose.”
Government Should Level With Public About Social Security Trust Fund
By Allen W. Smith, Ph.D.
September 21, 2012
The Security Trust fund is empty. It contains no bonds or anything else of value. This has been true for the past 30 years, but the public has been misled to believe otherwise the whole time.
On January 21, 2005, David Walker, Comptroller General of the Government Accountability Office (GAO), made a public statement that was designed to make it clear that the trust fund did not hold any real assets. Walker said, “There are no stocks or bonds or real estate in the trust fund. It has nothing of real value to draw down.”
The intent of the Social Security Amendments of 1983 was not followed. The surplus Social Security revenue from the tax hike was supposed to be saved and invested in marketable Treasury bonds to build up a reserve with which to finance the retirement of the baby boomers. But that didn’t happen. From the time the first surplus revenue arrived in 1985, until the surpluses ended in 2009, all of the Social Security surplus revenue was deposited into the general fund where it became indistinguishable from other federal tax revenue. The Social Security money helped to finance wars and other government programs. But none of it went to Social Security. The actual money was replaced with non-marketable government IOUs, called “special obligations of the Treasury.” These IOUs are not at all like the marketable Treasury bonds held by China and other U.S. creditors. They are nothing more than an accounting record of how much Social Security money was spent for other purposes.
- See more at: http://www.fedsmith.com/2012/09/21/government-should-level-public-about-social/#sthash.GpnbT63j.dpuf
Government Should Level With Public About Social Security Trust Fund
Social Security is not close to being BK. That is a myth perpetuated by the right-wing so the rich can get their hands on it and to cut benefits.
If the right were really worried about SS they could propose the ceiling on the payroll taxe be lifted. The rich are already paying an historic low in effective tax rates. So the rich’s wealth and income have skyrocketed while their taxes have plummeted. And now they complain about a program that keeps millions of Americans out of poverty in their old age.
They just want it all.
No Lola. You just want something for nothing.
Here’s some facts for free.
Social Security Cannot Go Bankrupt
http://www.forbes.com/sites/johntharvey/2014/08/14/social-security-cannot-go-bankrupt/
This will mark the third time I have posted this piece, but Social Security is so poorly understood that I thought it couldn’t hurt to do it again. Plus, a friend informed me that today was the anniversary of the signing of the Social Security Act by FDR in 1935!
It is a logical impossibility for Social Security to go bankrupt. We can voluntarily choose to suspend or eliminate the program, but it could never fail because it “ran out of money.” This belief is the result of a common error: conceptualizing Social Security from the micro (individual) rather than the macro (economy-wide) perspective. It’s not a pension fund into which you put your money when you are young and from which you draw when you are old. It’s an immediate transfer from workers today to retirees today. That’s what it has always been and that’s what it has to be–there is no other possible way for it to work.
SS doesn’t work Lola. Bankrupt like you.
SS works. The rich just want to gut it for their gain.
When someone else is paying for it, of course it works Lola.
Social Security works.
Could Social Security go bankrupt? Not Likely
http://www.cbsnews.com/news/could-social-security-go-bankrupt/
“I’ll never get a cent from Social Security.”
That thinking couldn’t be more wrong. Social Security is one of the most popular government programs around, as our political leaders well understand — Social Security will be around as long as democracy reigns, in other words.
The news media often don’t help by running scary headlines suggesting that the Social Security Trust Fund will run out of money in the not-too-distant future. So it is understandable that many people mistakenly conclude that they won’t receive any benefits.
The fact is that under current law, the Social Security Trust Fund could run bone dry and you’d still get most of your benefits. You see, the Trust Fund is only a supplemental source of funding for Social Security. Most of your Social Security retirement and disability benefits are actually funded from taxes collected each pay period from current workers (That’s the deduction for FICA taxes on your paycheck).
The bottom line: As long as workers are paying FICA taxes, there will be money to pay for Social Security benefits for retirees and their beneficiaries.
So long as someone else is paying for it, of course it won’t Lola.
Social Security and Medicare work very well and are two of America’s best social programs - good for society and approved of by most Americans.
Don’t let the right-wing make you believe their propaganda. They just want that money for themselves.
“Social Security is not close to being BK. That is a myth perpetuated by the right-wing so the rich can get their hands on it and to cut benefits.”
LOL
I once tried to have a reasonable discussion with my MIL about fixing SS and Medicare. I thought I’d start with SS because it’s easy to fix (Bowles Simpson had a good plan for this).
She first tried to tell me that it wasn’t broken.
Then I explained to her that as-is, I’ll only get about 3/4 of my scheduled payment (because the trust fund will have run out).
Her response “You can’t believe everything you read. Where did you hear that?” (i.e. don’t believe the conspiracy)
My response: My social security statement.
Social Security needs a small adjustment to stay solvent long term.
Medicare on the other hand is screwed. We pay out 3x what is paid in for each person. In large part, because we don’t control what is spent. And yes, we are very efficient at spending money through medicare, if that’s your measure of success.
Saying Medicare is a success is just like saying that every debt-ridden American, living far beyond its means, with no hope of ever being above water, is a success because every day they get what they want AND what they need.
That only works for so long.
“The bottom line: As long as workers are paying FICA taxes, there will be money to pay for Social Security benefits for retirees and their beneficiaries.”
From my social security statement:
“The law governing benefit amounts may change because, by 2033, the payroll taxes collected will be enough to pay only about 77 percent of scheduled benefits. We based your benefit estimates on these facts:”
No, social security will not run out of money. But it won’t be able to pay ALL benefits for retirees.
SS doesn’t work..
Social Security works. The right-wing is lying. As they do here.
“By hook or by crook”
Collecting firewood are you?
“Collecting firewood are you?”
Can’t afford it.
The EPA Is Ready To Regulate Americans’ Wood Stoves
Michael Bastasch
02/05/2015
The EPA has finalized a 344-page rule to make wood stoves more environmentally friendly, meaning that millions of Americans will soon be forced to buy more expensive wood-fired stoves.
dailycaller.com/2015/02/05/epa-wood-stooves/ - 173k -
No grandfather clause?
In Denver (and most of the front range), new construction cannot have wood burning fireplaces. Older houses are allowed to used their existing fireplaces, but anything built in the last 20 years or so can only have gas burning fireplaces.
In San Jose you may soon be forced to convert your exsiting fireplace to gas or electric or seal it off with brick. Not an attractive focal point.
“Bay Area homes with wood-burning fireplaces could not be sold or rented unless they were equipped with cleaner devices, such as gas, under the first proposal of its kind in California. Retrofit costs could range from hundreds of dollars to $2,000 to $3,000 or more — depending on the home and device installed.”
A home seller could comply by replacing an open hearth fireplace with one fueled by clean natural gas or electricity, a closed-loop insert that is typically encased in glass, or an EPA-certified stove. A property seller also would have the option of making the old fireplace inoperable, for example by sealing it off with bricks, said Wayne Kino, the air district’s director of enforcement.
San Jose Mercury
Comment by phony scandals
2015-03-23 13:35:46
The EPA Is Ready To Regulate Americans’ Wood Stoves
dailycaller.com/2015/02/05/epa-wood-stooves/
No debt = immeasurable freedom.
Life just feels different when you have no payments.
Worthless housing…. worthless worthless housing. Housing is worth less and less with each passing day.
Vienna, VA(DC Metro) List Prices Nose Dive 17%; Inventory Billows 120%
http://www.movoto.com/vienna-va/market-trends/
Worthless housing…. worthless worthless housing.
Totally logical. Housing, food and health are all worthless - and worth less with each passing day.
Cheer up Lola and remember…. Falling prices of all kinds is positively bullish and good for the economy.
. Falling prices of all kinds is positively bullish and good for the economy.
What does that have to do with “housing being worthless” according to you? Your logic is cartoonish.
Housing is worth less and less with each passing day.
Shelter is actually worth more and more to us each passing day because as we get older, shelter becomes more important to our survival.
Falling housing prices is a net positive Lola.
How does falling prices equal “worthless”? Explain please. You can’t.
Why do falling prices anger you Lola?
Are you in a Jade Helm 15 state?
If you are in a Jade Helm 15 state, is your state…
Red: Hostile
Blue: Permissive
Brown: Uncertain (Leaning Hostile)
Light Blue: Uncertain (Leaning Friendly)
Your tax dollars at work.
http://www.washingtonpost.com/world/national-security/pentagon-loses-sight-of-500-million-in-counterterrorism-aid-given-to-yemen/2015/03/17/f4ca25ce-cbf9-11e4-8a46-b1dc9be5a8ff_story.html
http://www.cnbc.com/id/102527420
U.S. housing has a supply problem. more kool-aid please.
From the article;
“according to the National Association of Realtors”
Anything else?
permits and fees can be 50 / ft in cali.
permits and fees can be 50 / ft in cali.
“Housing Analyst” has a workaround on reality. He won’t share it with us but he has one. Just ask him.
Back to $90k building permits again Lola?
‘New Zealand launched a covert surveillance operation targeting candidates vying to be director general of the World Trade Organization, a top-secret document reveals.’
‘In the period leading up to the May 2013 appointment, the country’s electronic eavesdropping agency programmed an Internet spying system to intercept emails about a list of high-profile candidates from Brazil, Costa Rica, Ghana, Indonesia, Jordan, Kenya, Mexico and South Korea.’
‘New Zealand’s trade minister, Tim Groser, was one of nine candidates in contention for the position at the WTO, a powerful international organization based in Geneva, Switzerland that negotiates trade agreements between nations. The surveillance operation, carried out by Government Communications Security Bureau, or GCSB, appears to have been part of a secret effort to help Groser win the job. Groser ultimately failed to get the position.’
‘Last week, The Intercept revealed that GCSB used XKEYSCORE to target top government officials and an anti-corruption campaigner in the Solomon Islands.’
‘Earlier disclosures, which were based on documents from NSA whistleblower Edward Snowden, have exposed how New Zealand is funneling data into XKEYSCORE from a surveillance base in the Waihopai Valley and is spying on about 20 countries across the world, predominantly in the Asia-Pacific region, among them small Pacific islands and major trading partners including Japan, Vietnam and China.’
https://firstlook.org/theintercept/2015/03/22/new-zealand-gcsb-spying-wto-director-general/
Once you have the keys to this thing, it’s apparently pretty easy to see anything.
Skip/mute the intro ad, but listen to Boogie Down Productions first album plz
https://www.youtube.com/watch?v=f1OhaXQ0Tcc
HBB after hours? Is it like Black Twitter? Reals before feels?
Skip/mute the intro ad, but this is one of the realest real albums of the 1990’s, before Ice Cube sold out to Hollywood:
https://www.youtube.com/watch?v=blrwIyzPL-M
D.C. Realtor: Low mortgage rates are killing the industry.
http://wolfstreet.com/2015/03/23/melissa-terzis-realtor-low-mortgage-rates-are-killing-the-industry-washington-dc/
Costco gas is under $3/gal again, and I’m loving it!
I have so much money left over these days after filling my gas tank at Costco that we could afford to fill a swimming pool with Starbux lattes — if only we had a pool!