The Housing Bubble

“…30 percent of Texans do not have health insurance…”

And that’s on the good side of town.

The study from the Commonwealth Fund, a health research organization, uses survey data to compare the four largest states: California, New York, Texas and Florida. It finds higher access to healthcare in California and New York, which have expanded Medicaid.

More free cheese for everyone. I wonder if medical marijuana is included. How many joints is it gonna take to get me through today?

Repost from a few days ago, article notes that 30 percent of Texans do not have health insurance, LOLZ

I thought everyone in Texas was a millionaire.

Meanwhile, here in the Centennial state, only 11% are uninsured. It was 17% before the ACA kicked in.

The powers that be have absolutely convinced the public that they have engineered the goldilocks landing in housing and now it is back off to the races. It will take reports of 10 percent YOY declines in YOUR zip code or neighborhood to say otherwise and trigger the panic again.

It is a fairly easy figure to come by.

SHYSTER!

Did you happen to notice any Frisco Fraudies or Degenerate Gamblers slithering around there?

“God knows how come those people have this much money.”

A flute and a snake in a basket, and the profits soar like a homesick angel.

The median apartment prices in Delhi in good locations were average 3-5 million dollars. The low end in outskirts were like 500K-1M USD. God knows how come those people have this much money.

I’ve seen the salaries that my employer pays over there. SW Engineers are paid about $20K USD. Who is buying these $500K apartments?

As I’ve said before, our bubble is nothing compared to those in other countries. Even Silicon Valley is a bargain compared to their prices.

Complete and total insanity. Meanwhile, central banks around the globe print money non-stop.

April 11, 2015
Structural Failure and QE and ZIRP
By Michael Booth
…
Despite the obvious, the central bank of every major country on the planet currently has one or both of these programs in force. The U.S. Fed has, to it credit, ended QE. It is clear, however, that ending ZIRP is going to be a difficult and painful process. And there are more than a few smart observers who think ZIRP will never voluntarily end in the U.S. — nor in Japan, nor in Europe. Their judgment is that the pain of allowing the free markets to retake control of the level of interest rates of intermediate and long maturity bonds, called ending ‘financial repression’, will prove unbearable. One need only imagine the bipartisan political panic were the interest paid by the U.S. federal government on its debt to double or triple, squeezing out hundreds of billions of dollars of spending on military and social programs.
…

They were never on the table.

only for poor people with credit cards 19.9% seems fair

IMO the “Good Ol’ Days” were the days when few Americans ever heard of the Federal Reserve and had little idea of just what it did.

But now? Now the U.S. has become totally “financialized” and most every decision that affects our live are financial decisions - financial decisions made by the so-called “elite” that run the Fed and people and markets everywhere scrutinize and closely parse every word that passes from the lips of these elites and as a result billions of dollars - BILLIONS OF DOLLARS - are either added to or subtracted from so-called market values EVERY DAY.

IMO if one were able to step back a take a good hard look at the Big Picture then it just might dawn on him just how really stupid all of this has become.

The Fed won’t hike until it is absolutely forced to do so.

Bernanke: There’s No Housing Bubble to Go Bust
Ben S. Bernanke testified on Capitol Hill just before being nominated to succeed Fed Chairman Alan Greenspan. (By Ron Edmonds — Associated Press)
By Nell Henderson
Washington Post Staff Writer
Thursday, October 27, 2005

Ben S. Bernanke does not think the national housing boom is a bubble that is about to burst, he indicated to Congress last week, just a few days before President Bush nominated him to become the next chairman of the Federal Reserve.

U.S. house prices have risen by nearly 25 percent over the past two years, noted Bernanke, currently chairman of the president’s Council of Economic Advisers, in testimony to Congress’s Joint Economic Committee. But these increases, he said, “largely reflect strong economic fundamentals,” such as strong growth in jobs, incomes and the number of new households.

Bernanke’s thinking on the housing market did not attract much attention before Bush tapped him for the Fed job Monday but will likely be among the key topics explored by members of the Senate Banking Committee during upcoming hearings on his nomination.

Many economists argue that house prices have risen too far too fast in many markets, forming a bubble that could rapidly collapse and trigger an economic downturn, as overinflated stock prices did at the turn of the century. Some analysts have warned that even a flattening of house prices might cause a slump — posing the first serious challenge to whoever succeeds Fed Chairman Alan Greenspan after he steps down Jan. 31.

Bernanke’s testimony suggests that he does not share such concerns, and that he believes the economy could weather a housing slowdown.

“House prices are unlikely to continue rising at current rates,” said Bernanke, who served on the Fed board from 2002 until June. However, he added, “a moderate cooling in the housing market, should one occur, would not be inconsistent with the economy continuing to grow at or near its potential next year.”

Greenspan has said recently that he sees no national bubble in home prices, but rather “froth” in some local markets. Prices may fall in some areas, he indicated. And he warned in a speech last month that some borrowers and lenders may suffer “significant losses” if cooling house prices make it difficult to repay new types of riskier home loans — such as interest-only adjustable-rate mortgages.

Bernanke did not address the possibility of local housing bubbles or the risks faced by individual borrowers or lenders in a slowing market.

But if Bernanke is confirmed as Fed chief, and if the housing market slows more than he expects, he would be unlikely to use the central bank’s power over short-term interest rates to prop up falling housing prices for the sake of individual homeowners, according to comments he has made in numerous speeches and statements in academic papers.
…

China’s Debt Binge Spawns Asset-Backed Bond Boom
by Lianting Tu
5:10 PM PST
March 2, 2015

(Bloomberg) — Banks are bundling loans into securities to make room on their balance sheets for more lending amid a fading property boom and stuttering economic growth. This isn’t the U.S. circa 2007, it’s China in 2015.

Having banned asset-backed bonds in 2009 after they’d helped spark the global financial crisis, authorities in the world’s second-largest economy started allowing sales in 2012. Issuance has climbed since then to 282.3 billion yuan ($45 billion) last year, almost 15 times the offerings in 2013, according to data compiled by Bloomberg. Sales are already up 147 percent this year versus the same period in 2014.

The boom is alarming ratings companies as soured loans rise to the highest in four years and China’s total debt soars to over 250 percent of its gross domestic product, more than double the ratio for the U.S. and Germany. Chinese banks’ profit growth is slowing and the nation’s economy, which expanded at the weakest pace since 1990 last year, is struggling to regain momentum.

“There’s been no real economic crisis in China in the past few decades, but if a severe one happens, the performance of the underlying assets backing these securities could deteriorate significantly,” said Jerome Cheng, a structured finance analyst at Moody’s Investors Service in Hong Kong.
…

ft dot com
April 10, 2015 5:23 pm
Sinking iron ore price hits smaller producers
By Henry Sanderson

Casualties are mounting among the world’s smaller iron ore producers as the steelmaking ingredient continues a dramatic plunge, with little sign of a rebound.

Atlas Iron was the latest to be hit. The Australian group said on Friday it would suspend mining operations this month, followed by a halt in exports, depending on market conditions.

Iron ore fell to $47 this week, down almost a third since the start of the year, and at the lowest since the Steel Index started compiling the data in 2008. Futures for September delivery on China’s Dalian Commodity Exchange have fallen 25 per cent this year to a record low on Friday.
…

US Remains The World’s Top Oil And Gas Producer
1:14 PM 04/07/2015
Michael Bastasch

The United States was still the world’s top producer of oil and gas in the world during 2014, despite falling oil prices.

The Energy Information Administration reports that “U.S. hydrocarbon production continues to exceed that of both Russia and Saudi Arabia, the second- and third-largest producers, respectively.” EIA adds that U.S. petroleum production has increased “by more than 11 quadrillion British thermal units” thanks to drillers in Texas and North Dakota.

“Despite the 50% decline in crude oil prices that occurred in the second half of last year, U.S. petroleum production still increased by 3 quadrillion Btu (1.6 million barrels per day) in 2014,” EIA notes. “Natural gas production—largely from the eastern United States—increased by 5 quadrillion Btu (13.9 billion cubic feet per day) over the past five years.”
…

“There is no worse tyranny than to force a man to pay for what he does not want merely because you think it would be good for him.”

Robert A. Heinlein

This is how I feel about the oppressive health insurance payments I make every month.

From the article:

“GE is immensely smart.”

Oh? How so?

“It got bailed out by the Fed during the Financial Crisis when it was running out of liquidity – having borrowed short-term for long-term investments, among other sins.”

Oh, so they are really not all that smart, but apparently they are well connected. And I suppose there truly are a lot of dummys that will confuse being well connected with being smart.

I like your perspective, which was strangely missing from the MSM article.

I always enjoy those, RayKay, thanks for posting.

You are more likely to see California house prices crater than people move out of the state. Economically, they are trapped.

The ones who laugh at me because I do not own real estate but can buy two Irvine houses with all my net worth, are not going to laugh when their house values crater.

If they can’t sell their houses, few will have two nickels to rub together.

I suspect that as long as they have jobs they will stay put, even if they all have to let their lawns die.

The only ones leaving in the short term will be bankrupt farmers, unemployed farmworkers, and lawn gardeners. California’s water problems in the major cities will be solved when the price of water gets expensive enough that construction of sewage recycling and desalination becomes economical.

“Our filed folks are not as sensitive as we are to the fact that anything we write can be public–or at least be seen by Congress”

Bahahahahaha … maybe that because your “filed folks” have some balls and you upper echelon guys don’t

Here’s a better link:

http://en.wikipedia.org/wiki/Lost_Decade_(Japan)

Anti Austerity.

What a joke.

There have been no reductions is Spanish or American government spending or government growth.

The people still want their free sh*t and will vote for anyone who promises more free sh*t.

Talk about a road to nowhere

“Podemos” and “Ciudadanos” are just retreads for the existing left and right wing parties in Spain. People there are hoping that these parties won’t be rife with corruption like the established parties are. And while that might be true for now, once they gain power they will become just like the parties they are replacing.

When I was in Spain some years ago on a biz trip I explained to my hosts there the concept of Libertarianism. They found it “shocking” and in their words “impractical”. Anywho, they aren’t interested in real change, they just want the old system to work. Kind of like we do in our own country.

“After she left the State Department she could have slipped into grandmother-hood, but people want to call her back into public service,” said Jarret Berg, 29, a Democratic staffer in the New York legislature. “It’s time for her.”

So the question is:

Will Hillary make the sacrifice? Will she give up slipping into grandmother-hood to answer the call of people who want to call her back into public service?

(Public service, a rather interesting set of words.)

“Clinton will enter the race as the overwhelming favorite for her party’s nomination. Still, her team has said her early strategy is designed to avoid appearing to take that nomination for granted.”

Beg her, we must beg her to run.

“Clinton’s growing team of staffers began working Friday out of a new campaign headquarters in Brooklyn. They gathered Saturday to hear from campaign manager-in-waiting Robby Mook, who told them the campaign would value teamwork, respect, diversity, discipline and humility.”

Humility?

Shirley, you jest.

Amazingly - ever other democrat has be cowered not to run.

Your choice has been made. There will be no dissent

Once that reality sets in—that other than being a speculative bet on rising prices, condos as investments are money losers—it’s only a question of how many will run for the exits.

Soon. Very soon…

“Isn’t that the first sign of the apocalypse?”

The four realtors of the Apocalypse? Hehe.

Funny how the crops fail and the electricity won’t work once you kick out whitey

It seems as though central bankers have taken over the government debt market pretty much everywhere.

What next: Robotic central bankers rule the world?

Waterboarding? Do they get to do waterboarding?

It must be pretty expensive to run an entire airport for the benefit of an average ten passengers per day! I’d love to see the figures on cost per passenger; if anyone has them, please post.

Empty airports = Ghost airports.

Ghost airports to take ghost travelers to ghost cities.

(Ghost riders in the sky?)

Don’t want to seem racis’, but could this really be about the paradigm gap between the Jewish and Christian world views?

Arguments over Greek debt echo ancient disputes about Easter
Giles Fraser
Greek Orthodox priests attend the washing of the feet ceremony in the Church of the Holy Sepulchre, Jerusalem, ahead of Orthodox Easter. Photograph: APA Images/REX Shutterstock
Friday 10 April 2015 08.52 EDT
Last modified on Friday 10 April 2015 19.06 EDT

The eastern Orthodox churches finally split with the Roman Catholic western church in 1054, though the differences had been building up long before and have continued ever since. Among these, the eastern churches retained the Julian calendar – which is why, this year, Orthodox Easter falls on Sunday 12 April, a week later than for the western churches. More significantly, because of this great schism, eastern churches such as the Greek Orthodox church didn’t fall under the sway of a theory of salvation developed by St Anselm of Canterbury and his massively influential Cur Deus Homo of 1089, a book that radically altered the western understanding of Easter and, with it, a great deal of our moral hinterland. Indeed, the respective current attitudes towards debt of the Greek and German governments can be seen, to a remarkable extent, to track the eastern-western split over the meaning of Easter.

According to Anselm, and the Reformation thinkers that followed him, the story of Easter is basically God’s response to a debt crisis. The argument is this: human beings have sinned against God, thus incurring a debt that has to be paid. (If you think this shift from sin to debt is odd – and it is – remember we still speak of criminals as “paying back” their debt to society.) On this model, the scales of justice have to be balanced. Crimes must be paid for, with the level of punishment being proportionate to the level of offence. But the theological problem is that human debt is way too high – us being miserable sinners and all that – which means that we are totally incapable of paying back the required amount.

This is why, says Anselm, Jesus comes to receive the punishment that is due to us and is crucified, thus repaying the debt on our behalf and levelling our account. Redemption, remember, is an economic metaphor. “There was no other good enough to pay the price of sin,” as many western Christians are singing this Eastertide. For evangelicals especially, this is the very essence of salvation. Sin is repaid. Hallelujah.

But this is absolutely not the eastern story of Easter. Indeed, no Greek Orthodox congregation will be singing about Jesus paying the price of sin during their Easter services. For one thing, they are not so obsessed with sin. And they don’t think that Jesus’s suffering (or anyone else’s) is the way it gets repaid. Indeed, it doesn’t get repaid. Which is why Greek Christian art, unlike western Christian art, doesn’t obsess with the bleeding crucified Jesus. For eastern theologians, Jesus’s mission is to break human beings free from their imprisonment to death. All the important action happens at the resurrection, not the crucifixion. For, if salvation is merely payback and this happens on the cross, there is no saving work left for the resurrection to do. No, they say, salvation is not some bloody cosmic accountancy. It’s a prison break. The emphasis is on Christ leaping from the grave not hanging on a cross. It is about life triumphant over death.
…

I think today is the Orthodox Easter. Would be an opportune time for Greece and Russia to pull something out of their sleeve in the name of Orthodox solidarity.

News
Orthodox Easter takes on additional meaning for debt-ridden Greece
11/04 05:51 CET
Greek Prime Minister Alexis Tsipras has joined worshippers celebrating Orthodox Easter in Athens.

Like Orthodox Christians across the world, Greeks are now marking events they believe led to the crucifixion, burial and resurrection of Christ.

In a sombre procession, a symbolic tomb of Jesus is carried through the streets, in the shadow of parliament, with the debt-ridden country’s contemporary woes never far away.

“We have been through a lot,” one woman told euronews.

“This is a symbolic day. If we have faith, we can make it. We must give a chance to our new government,” she added, stressing that
foreign partners must give Greece a chance, too.

“I feel that everything will be fine,” she said.

But life remains difficult with Greece struggling to emerge from years of recession.
…

Markets | Sun Apr 12, 2015 9:16pm EDT
Euro on defensive on yield pressure, Greece concerns
TOKYO | By Hideyuki Sano
A photo illustration shows U.S. Dollar and euro banknotes in Vienna March 16, 2015. REUTERS/Heinz-Peter Bader

(Reuters) - The euro was on the defensive on Monday morning, pressured by the European Central Bank’s stimulus driving interest rates lower in the euro zone and on concerns over talks between debt-strapped Greece and its creditors over more funding for Athens.

The euro traded at $1.0615, flat on the day after having touched a 3 1/2-week low of $1.05670 to post its fifth straight day of losses on Friday.

“We think the euro will fall below parity against the dollar by the end of the year because of the ECB’s easing and low returns on capital in the euro zone,” said Shin Kadota, chief FX strategist at Barclays in Tokyo.

Investors have been dumping the common currency as the ECB’s bond buying since last month has been driving down euro zone bond yields to negative levels in many countries.

Against the yen, the euro stood at 127.30 yen, not far from a 21-month low of 126.915 yen hit last month.

Adding to the pressure on the euro, Greece has been bickering with the euro zone over its reform program ahead of euro zone finance ministers’ meeting on April 24 to consider more funding for Athens.

A German newspaper reported on Saturday euro zone officials were shocked at Greece’s failure to outline plans for structural reforms at last week’s talks in Brussels.

Data from U.S. financial watchdog showed late on Friday speculators’ net short position against the euro remained near record high.

Their net euro short position stood at 215,258 contracts last week, not far from a record 226,560 contracts set the week before.

The British pound also traded near a five-year low against the dollar hit on Friday following a weaker-than-expected UK industrial output and concerns about political uncertainty after a British election next month.

The pound stood at $1.4641, having hit five-year lows of $1.4588 on Friday.
…

Letters
Reforms Aren’t Going to Save Greece
Greece has never been a self-sustaining country. Since modern Greece was founded in 1832, the Greek Government has defaulted six times (this will be the seventh).
April 12, 2015 2:04 p.m. ET

Your editorial on Greece assumes that Greece can be saved by “reforms” (“The Case for Letting Greece Go,” April 9). A look at history would show that this isn’t true; Greece has never been a self-sustaining country. Since modern Greece was founded in 1832, the Greek government has defaulted six times (this will be the seventh), and for half of these years was either in default or in reconstruction.
…

“The governors’ conclaves have played a crucial role in determining the world’s response to the global financial crisis.”

Hold it! This “global financial crisis” thingy, which of you guys were in charge when this global financial crisis was brewing? It’s a bitch of a question but it has to be asked.

“’The BIS has been a very important meeting point for central bankers during the crisis, and the rationale for its existence has expanded,’ said King.”

“… for central bankers during the crisis ..the rationale for its existence has expanded.”

And that’s a surprise? (Remember folks, a crisis is a terrible thing to waste. And it’s good to have one handed to you; It saves you from having to create one).

“We have had to face challenges that we have never seen before.”

A room full of selfless heroes. My, aren’t we fortunate.

“We had to work out what was going on, what instruments do we use when interest rates are close to zero, how do we communicate policy. We discuss this at home with our staff, but it is very valuable for the governors themselves to get together and talk among themselves.”

The pain they endured must have been nearly unbearable.

Mark Twain: “No man’s life, liberty, or property are safe while the legislature is in session.”

These guys, too.

“’The town’s small, very tight knit,’ the resident of nearby Stamford said.”

Okay …

“That doesn’t mean we want to keep anyone out.”

But if you don’t keep people out then it wouldn’t be small, and very tight knit.

“It’s a small, little New England town and I think they want to keep it that way.”

Reminds me of Malibu people.

Got oil inventory?

…
Meanwhile, the historic deformation of the oil markets continues unabated, with last night’s massive 12.2 million barrel increase in API crude oil inventories – just validated by an equally massive EIA build minutes ago – representing the largest weekly build in 30 years; in turn, causing the key Cushing storage hub to be filled to a record 90% of capacity. Following in the footsteps of the great David Stockman, my January 2nd article, the “direst prediction of all” placed blame on the historic oil (and generally speaking, commodity) oversupply on Central bank money printing – aided and abetted, of course, by the aforementioned “weapons of mass destruction” created in Wall Street’s derivatives and securitization labs. And as they say, when it rains it pours – which is probably why it’s so ironic that the U.S. is choosing to ease its Iranian sanctions now. As for the recent WTI crude surge, from last month’s low of $42/bbl to the still horrible $52/bbl today, I’d attribute a third to the blatant actions of the newly formed “oil PPT” – which I’ve discussed ad nauseum in recent weeks; a third to the “deformed” perma-optimism that has been engendered by years of market manipulation; and a third to the slight chance that the Yemeni revolution breaks out into a broader regional conflict. That said, with each passing day the level of oversupply is increasing, making it more and more likely that not only will the Cushing terminal be filled to capacity, but the world’s desperately cargo-seeking tanker fleet.
…

The Oil Industry’s $26 Billion Life Raft
by Asjylyn Loder and Dakin Campbell
3:00 PM PST
April 8, 2015
U.S. shale oil operations.
Photographer: Eddie Seal/Bloomberg

For U.S. shale drillers, the crash in oil prices came with a $26 billion safety net. That’s how much they stand to get paid on insurance they bought to protect themselves against a bear market — as long as prices stay low.

The flipside is that those who sold the price hedges now have to make good. At the top of the list are the same Wall Street banks that financed the biggest energy boom in U.S. history, including JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc. and Wells Fargo & Co.

While it’s standard practice for them to sell some of that risk to third parties, it’s nearly impossible to identify who exactly is on the hook because there are no rules requiring disclosure of all transactions. The buyers come from groups like hedge funds, airlines, refiners and utilities.

“The folks who were willing to sell it were left holding the bag when prices moved,” said John Kilduff, partner at Again Capital LLC, an energy hedge fund in New York.

The swift decline in U.S. oil prices — $107.26 on June 20, $46.39 seven months later — caught market participants by surprise. Harold Hamm, the billionaire founder of Continental Resources Inc., cashed out his company’s protection in October, betting on a rebound. Instead, crude kept falling.

West Texas Intermediate oil futures rose $1.12 to $51.54 a barrel in New York at 9:41 a.m. London time. Prices are down 3.3 percent this year after plunging almost 50 percent in 2014.

Counterparty Names

Other companies purchased insurance. The fair value of hedges held by 57 U.S. companies in the Bloomberg Intelligence North America Independent Explorers and Producers index rose to $26 billion as of Dec. 31, a fivefold increase from the end of September, according to data compiled by Bloomberg.

Though it’s difficult to determine who will ultimately lose money on the trades and how much, a handful of drillers do reveal the names of their counterparties, offering a glimpse of how the risk of falling oil prices moved through the financial system. More than a dozen energy companies say they buy hedges from their lenders, including JPMorgan, Wells Fargo, Citigroup and Bank of America.

Danielle Romero-Apsilos, a Citigroup spokeswoman, said the bank actively hedges and manages its risk. Representatives of JPMorgan, Wells Fargo and Bank of America declined to comment.

At the end of 2014, JPMorgan had about $671.5 million worth of derivatives exposure to five energy companies, including Pioneer Natural Resources Co., Concho Resources Inc., PDC Energy Inc. and Antero Resources Corp., according to company records. That’s the amount JPMorgan would have owed if the contracts were settled Dec. 31, not including any offsetting trades the bank made.

It’s a similar story for Wells Fargo, which was on the hook for $460.9 million worth of oil and natural gas derivatives for companies including Carrizo Oil & Gas Inc., Pioneer, Antero, Concho and PDC, according to regulatory filings.

Energy Trading

These aren’t, of course, the kind of figures that would trigger any sort of systemic-risk concerns. Commodities are generally smaller parts of banks’ businesses compared with lending and underwriting, and banks hedge their oil-price risk.

New York-based JPMorgan had $2.57 trillion in assets at the end of last year compared with net liabilities for commodity derivatives of $2.3 billion, not including cash from settled trades and physical commodity assets, according to regulatory filings. San Francisco-based Wells Fargo had $1.69 trillion in total assets compared with net commodity liabilities of $241 million.

Still, $26 billion is $26 billion.
…

Oil has a ways to go to get up to AlbqDan’s predicted $80/bbl December 2015 future price.

Or was it $65 that he predicted?

I had to hold my nose while buying, as with a record oil glut, oil prices should be falling, not rising. But nonetheless, my energy mutual fund investment is up 5% in three months.

Thank you very kindly, oil price plunge protection team!

This is nuts. When’s the crash?
David Keohane | Apr 08 08:02
Part of the This is nuts. When’s the crash? series

Yes, dot-com comparisons are flung about all too easily. But it’s quite hard to argue with the fairness of this one from Bloomberg:

The world-beating surge in Chinese technology stocks is making the heady days of the dot-com bubble look tame by comparison.

The industry is leading gains in China’s $6.9 trillion stock market, sending valuations to an average 220 times reported profits, the most expensive level among global peers. When the Nasdaq Composite Index peaked in March 2000, technology companies in the U.S. had a mean price-to-earnings ratio of 156…

Valuations in China are now higher than those in the U.S. at the height of the dot-com bubble just about any way you slice them. The average Chinese technology stock has a price-to-earnings ratio 41 percent above that of U.S. peers in 2000, while the median valuation is twice as expensive and the market capitalization-weighted average is 12 percent higher, according to data compiled by Bloomberg…

“Many of these technology companies have bubble-type valuations as speculators take advantage of popular concepts to ramp up shares,” said Haitong’s Chen, a strategist in Shanghai. “Only a very small group, say 5 percent or 10 percent, will make it to become larger companies.”

To be filed under: “that should end well” and “price to whatever ratios“. And that’s even taking into account tech stocks are worth only 13 per cent of China’s overall market cap, according to Bloomberg, compared to about 31 per cent for the U.S. in 2000 — meaning potential fallout from a tech dive might be more limited.

Now there does appear to be a presumption that talk of a near term correction in the index as a whole or in, say, tech stocks — using signs of speculative frenzy as your hook — is also a shot at the long term viability of the Chinese stock market. It obviously isn’t. It’s just that the present ramp up does look nuts from where we’re sitting even if we get notes suggesting one should buy on China skepticism on a daily basis.
…

Scared of the stock market? Maybe you’re just making excuses
Published: Apr 11, 2015 9:13 a.m. ET
You don’t have to be Warren Buffett to make money in the market
By Chuck Jaffe
Columnist

We’ve all heard the old saw that it takes money to make money. The bigger problem may be that a lot of people who are making money aren’t taking any of it and investing it.

A Bankrate.com study released Thursday showed that more than half of all Americans are avoiding making any investments in the stock market, and more than half of those non-participants blamed their situation on a lack of money.

While 53% of the study group cited a lack of money as their reason for avoiding the market, that cut was even higher (58%) for people aged 65 and up, entering retirement and, theoretically, desperate for growth as they enter a period where their income is shrinking.

Moreover, it wasn’t just millennials — the newest investors — complaining about a lack of dough; 46% of survey respondents making more than $75,000 per year were saying things were too tight to invest.

All of the key reasons for not investing smell like horse-puckey. They’re easily solved and sidestepped by anyone truly interested in investing.

But what makes the BankRate numbers doubly worrisome is when they are juxtaposed with the 2015 Financial Literacy Survey released earlier in the week by the National Foundation for Credit Counseling.

That study found a shocking rate of overconfidence combined with under-preparation. According to the survey, nearly 60% of consumers said they deserve an “A” or “B” when it comes to their own personal financial knowledge, yet only 57% of respondents are saving for their retirement; 70% of Americans are “currently worried about their personal finances.”

Put it together and you have a public that’s forgiving itself for acting badly and hiding behind excuses and poor logic.

“What it comes down to is that people think you have to have a lot of money to invest or play with before it makes a difference, or that you have to be a Warren Buffett for investing to pay off for you,” said Claes Bell, banking analyst at BankRate.com. “When people think of investing, it seems like they are thinking of speculation of getting rich quick, but smart investing looks like buying a tiny bit of an index fund or ETF every month for 20 or 30 years, and that’s what this survey suggests most people are simply not doing.”

Meanwhile, for years studies have shown that plenty of Americans are so pessimistic about their prospects that they believe the lottery is their best chance of accumulating a retirement nest egg of several hundred thousand dollars. The average household in the United States reportedly spends nearly $550 per year on lottery tickets, even though research from the Employee Benefit Research Institute showed that more than a quarter of Americans have less than $1,000 saved for retirement.
…
133 comments
124 people listening
…
Gregory Lee
8 hours ago

What kept me from saving for retirement was paying for the house I bought. Almost everything I had saved went to the down payment, and then mortgage payments ate up too much of my salary.

The inevitable Hillary Clinton
NEW YORK DAILY NEWS
Sunday, April 12, 2015, 4:48 AM
MICHAEL REYNOLDS/EPA
Here she comes

The analysis is instant when I ask Tom Bowen, a Chicago political consultant, to handicap the 2016 Democratic presidential race.

Hillary Clinton, expected to announce Sunday that she’s running, “is the most qualified nominee we’ve had in 30 years with the best chance for us to hold the White House and appoint justices to the court. It’s absurd to discuss anything else.”

He’s raining on the pundits’ parade that fills dead air and blank spaces with rank speculation. Inevitability is so boring. It’s like the U. Conn women’s basketball team.

“I share the conventional view that Hillary is unstoppable absent an unexpected sharp turn in the race that would almost certainly have to be a major scandal of some type (the email thing isn’t big enough to do it),” says David Hopkins, a political scientist at Boston College.
…

Which presidential candidate has the aura of inevitability?

Arsenic looks better and is better for you than any of those candidates.

Let your friends have a laugh at your expense for now, but your prudence will eventually pay off. I was about your age and in a similar situation when I started my first real job. I thought it was too expensive to buy a home, interest rates were high, and not much inventory was available, so I just saved and waited. My wife and I bought our first home at the tail end of the early 1990s recession, with a sea of inventory among which to choose. And I had the money saved up for a down payment.

This situation will eventually return, but we’re not there yet. It’s a mistake to not buy in a recession, when used houses go on sale, and a huge , though common, mistake to follow the herd and buy at or near a bubble peak.

“Meanwhile I save $3000 a month and max out my 401k every year.”

Outstanding!

“Both of them were in shock to hear I max out my 401k and say that is insane!”

Both of them are idiots.

“I’m 26 going on 27 and have $110k saved and plan on continuing to save and wait to buy in a few years. Hopefully things will cool off by then.”

Once again, outstanding!

You make this Selfish Hoarder proud.

Seriously, good job.

Did you know you can also save in an IRA at the same time you save in a 401k? If I was your age I would bite the bullet and do only a Roth 401k and a Roth IRA.

You are in California and chances are by the time you retire you will want to remain in California. Hence the reason for Roth. Most Californians love the beach life and cannot think of leaving the state.

It was the mid-1990s when I found out I can contribute both to a traditional IRA and a traditional 401k so I maxed to both.

Now at 55 I have over $1,000,000 saved in my tax deferred plans - about 40% of it in Roths. Haven’t decided if I want to retire in California or in Arizona.

They’re already falling.

San Diego, CA Sale Prices Plummet 11% YoY

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

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150412_change.jpg

“And then I told them there would be change.”

Saturday, Apr 11, 2015 06:00 AM PST
Bill Clinton’s surprising faith: From childhood through Monica Lewinsky, the real story of the president’s belief in God
What role did faith play in Clinton’s life, presidency and policy? More than you might imagine
Gary Scott Smith
…

Opinion
Daily Caller
Monica Lewinsky: Right-Wing Warrior
10:17 PM 04/06/2015
Political Reporter
Patrick Howley is an investigative reporter for The Daily Caller.

Monica Lewinsky is the Right’s Happy Warrior.

Lewinsky, the former White House intern, is devoting her life to a distinctly conservative cause. At first glance, Lewinsky’s campaign to end public shaming and social-media bullying might seem like a bland progressive endeavor. But make no mistake. Monica is the new R. Emmett Tyrrell. She’s to the right of the John Birch Society. They should give her a Golden Cigar at CPAC.

Lewinsky is 41 years old now and back in the public spotlight. No, she’s not living in a house with Kathleen Willey for a C-SPAN reality show. Instead, she’s staging a full-throated fight against online shaming, giving a well-received TED talk on the subject and joining Twitter. In her role as Vanity Fair contributing editor, Lewinsky this week interviewed “So You’ve Been Publicly Shamed” author Jon Ronson.

“It’s a strange combination of schadenfreude and othering people,” Lewinsky said of public shame mobs.
…

J. Maureen Henderson
Leadership 4/07/2015 @ 9:50AM
Monica Lewinsky, Public Shame, And The Perfect Horror Movie For Our Troll-Filled Times

Wherever you go, it follows. Even when your surroundings seem completely innocuous and safe, it’s still there, advancing on you in one of a million guises. The only way to shake it is to pass it on to someone else. While I’m talking about the supernatural curse at the heart of critically acclaimed new horror film, It Follows, I’m also talking about what the movie’s premise offers a brilliant allegory for – public shame in the internet age.

It’s a topic that’s all but inescapable these days.

Monica Lewinsky has been enjoying (if one can use that term) another 15 minutes in the media spotlight lately. She gave a highly regarded TED talk in March on the price of shame, garnered a media apology from Erica Jong for public remarks about Lewinsky during the height of Clinton impeachment hysteria and, in her role as Vanity Fair contributing editor (she’s penned several pieces for the magazine), recently interviewed Jon Ronson, author of So You’ve Been Publicly Shamed.
…

Life
Monica Lewinsky’s story needs to begin a new chapter: Timson
Seventeen years is a long time to wander in the wilderness of shame
A new TED Talk by Monica Lewinsky has put the former White House intern in the limelight again.
Fernando Leon / GETTY IMAGES
By: Judith Timson Current affairs, Published on Thu Mar 26 2015

I still don’t know what to make of Monica Lewinsky.

The former White House intern whose name, at 24, became worldwide shorthand for, as she said recently, “tramp, tart, slut, whore, bimbo and of course That Woman” after her sexual relationship with then President Bill Clinton resulted in his impeachment (spoiler alert, he survived nicely) is now 41, back in the spotlight, and saying some wise things.

“Insist on a different ending to your story,” Lewinsky said last week in a universally acclaimed TED Talk condemning “public shaming as a blood sport.”

Describing herself as “patient zero” in internet shaming — there was no social media in 1998, but news of her affair with Clinton as a young woman first broke on the gossipy online Drudge Report — Lewinsky called for a revolution in “compassion and empathy”.

She described how humiliated she had been when salacious details became public: “I lost my reputation, my dignity, I almost lost my life.”

Those details included snapping her thong at the pathetically weak-willed president to get his attention, administering oral sex to him beneath his desk as he talked to congressional leaders, and that infamous blue dress stained with his bodily fluids that made its way into rap songs.

She was fat shamed — one paper called her “the portly pepper pot” — slut shamed, and portrayed as an opportunistic sexual predator — albeit one who snagged the biggest predator of all.

Lewinsky’s TED Talk was beautifully rendered, as was her earlier essay in Vanity Fair magazine in which she had a sharp message for feminist thought leaders who were so desperate to keep a Democratic president in office they formed a mean girls club of their own, cackling about everything from her “third stage gum disease” to whether other men would go after what Bill Clinton had enjoyed: “I sorely wished for some sign of understanding from the feminist camp … Given the issues at play — gender politics, sex in the workplace — you’d think they would have spoken up.”
…

Are you all looking forward to reliving your memories of life with the Clintons in the White House?

I’m not.

Is it that she is the natural choice of about 50% of the US electorate that makes Hillary Clinton inevitable?

I believe the four females in my (parents’) nuclear family fit this profile: They will vote for Hillary simply because of the prospect of having a female president.

Mark Hulbert
Opinion: Leading indicators signal a market top
Published: Apr 10, 2015 6:00 a.m. ET
Consumer stocks and health care have been best performers this year, while financials lag
By Mark Hulbert
Columnist

CHAPEL HILL, N.C. (MarketWatch) — A bearish story is being told by the relative performance of the market’s various sectors.

That’s because the sectors with the best year-to-date returns are among those that typically lead the market prior to major tops. In addition, the sectors exhibiting the worst performances this year are those that typically lag.

We know how the market’s sectors have performed prior to past tops because of data from Ned Davis Research, which analyzed all bull market tops since 1970. According to the firm, the sectors that on average have performed the best over the three months prior to those tops are Consumer Discretionary, Consumer Staples and Health Care.

As you can see from the chart above, these are the very sectors that are at the top of the ranking for year-to-date performance, according to FactSet.
…

The Tell
This amazing dollar rally has a lot in common with classic bubbles
Published: Apr 10, 2015 3:38 p.m. ET
Final lurch higher possible, but capitulation likely to follow: HSBC
By William Watts
Deputy markets editor

NEW YORK (MarketWatch)—Currency strategists at British bank HSBC on Friday reiterated their contrarian call for the U.S. dollar’s torrid rally to soon come to an end. This time drawing a comparison between the currency’s sharp rise since last May to the pattern presented by classic asset-price bubbles.

Strategists led by David Bloom argued in March that the rally was nearing the end of its run, making HSBC the first bank to raise its euro forecast for 2016 and 2017.

In a Friday note, they elaborated on their call, drawing a parallel between the ICE dollar index’s gain of more than 25% since May 2014 and classic bubbles, such as the tulip mania that gripped the Holland in the 17th century or the South Sea Bubble of 1720.

“This constitutes a significant move and major rallies tend to have similar life cycles,” HSBC wrote. “In fact, such life cycles tend to follow the typical phases of classic asset-price bubbles, just on a smaller scale.”

In the chart included in this report, they lay out the anatomy of typical asset-price bubbles, which HSBC’s researchers divide into four phases. The dollar, they argue, is in phase 3.
…

Cantillon: Making the most of the bond bubble
New benchmark reached as Switzerland issues 10-year debt at negative yield
Sat, Apr 11, 2015, 05:42
First published:
Sat, Apr 11, 2015, 05:42

Everyone agrees it’s unsustainable, but the extraordinary run in government bond markets just keeps on going. This week a new benchmark was reached when Switzerland issued 10-year debt at a negative yield – in other words it charged lenders for the privilege of lending to it for a decade. Mexico issued a 100- year euro-denominated bond at just over 4 per cent.

In Ireland, 10-year Government bond interest rates were trading on yesterday at just over 0.7 per cent, fractionally above the record lows reached in early March. All Irish debt out to two years is now trading at negative yields and a few weeks ago Ireland joined “Club Neg” , the group of countries that issued new short-term debt at negative interest rates.

Few think this can continue in the long term but, with the ECB promising to buy more than €1 trillion of debt up to September 2016, and growth and inflation still low, the bond bubble remains in place.

In the medium term there are issues for all government borrowers, Ireland included. It would be a mistake to set national budgets on the basis that rates can remain at such lows in the years ahead, as experience suggests that when the market turns, it can turn quickly.
…

If Hillary gets elected I am buying stocks and a house. Not because I want to.

Does it drive you crazy to sit on your hands while others are making their fortunes riding up the housing and stock market bubbles?

Stockman’s Best of the Week, Stockman’s Corner
After Central Bank Financial Bubbles—-Comes Liquidation And Industrial Deflation
by David Stockman • October 13, 2014

Nearly two decades of central bank financial repression have created huge distortions and imbalances in the world economy. Now they are coming home to roost as the impossibility of ZIRP forever dawns on even our mad money printers. Having created yet another round of ebullient financial bubbles, they are now getting palpably nervous.

Even the lady with the perpetual tan and unfailing call for “moar” monetary and fiscal stimulus, IMF head Christine Lagarde, said something sensible over the weekend:

There is too little economic risk-taking, and too much financial risk-taking.

She got the “too much financial risk-taking” part right, but here’s the thing. The apparatus of state policy—-fiscal borrowing and central bank money printing—-can not cause enterprise to flourish. Free market capitalism is the milieu in which business enterprise, invention, risk-taking and labor productivity thrive best. So, yes, reducing market impairments—such as tax rates on production and capital which are too high or regulations, protectionist laws and subsidies which are too onerous—-is always helpful.
…

Mom dangled toddler over cheetah pit then he fell
Associated Press
Posted: 04/12/2015 01:42:02 PM PDT | Updated: about 5 hours ago

CLEVELAND (AP) — A woman was dangling her 2-year-old son over a railing at the Cleveland zoo when he fell about 10 feet into a cheetah exhibit, zoo officials said.

The toddler’s parents jumped in and pulled him to safety Saturday afternoon. He was treated at a hospital for a few bumps and bruises, said Cleveland Fire Department spokesman Larry Gray.

The cheetahs didn’t go toward the boy or his parents, said Chris Kuhar, executive director of Cleveland Metroparks Zoo.

Several eyewitnesses saw the woman holding the child over the railing, Kuhar said in a statement. “While this incident is disturbing to everyone, we are glad injuries were not any more severe,” he said.

Cleveland Metroparks plans to seek child endangering charges against the mother on Monday, he said.

A similar incident at a Pittsburgh zoo left a 2-year-old boy dead in 2012. The child was fatally mauled after falling into a wild African dogs exhibit.

The boy had lunged from his mother’s grasp and fell about 10 feet from the top of a wooden railing into the enclosed exhibit below.

The boy’s parents sued the zoo, saying it had been warned about other parents who routinely lifted children onto the railing.
…

Will the investment funds jump back into the market again to save the day?

“During most of the recovery, rising home prices and the completion of foreclosures pushed down the number of homeowners with negative equity from a recession peak of 15 million.”

Prices, we are talking about prices here.

“Now, however, many lower-value homes are losing value again, Zillow reported, and that’s what’s behind the rising rates of negative equity.”

Now we have switched over to talking about values.

Anybody here ever notice this? People talk of prices when prices go up but they talk of values when prices go down. Strange.

Best part of Hillary Clinton candidacy: Return appearance of Darell Hammond as Bill Clinton

Same as always: Endure.

I learned to ignore them. I do not recognize their authority. I continue to live on.

Looking forward to comparing Iowa Electronic Markets election predictions to Rasmussen polls again. Last time, the IEM got it right, and Rasmussen missed.

This time the prediction is for a slight edge in favor of a Democratic candidate win.

1.6% growth for China would be in line with what the rest of the world is experiencing. Of course, subtract the ongoing construction of wasteful infrastructure, and it’s probably even smaller.

“Cornerstone Macro reports, “Our China Real Economic Activity Index Slowed To Just 1.6% YY In 1Q.” The indicator in question looks at many of the components shown above, such as retail sales, car sales, rail freight, industrial production, and several others, to determine an accurate indicator of the true state of China’s economy. It finds that not only is China’s economic growth rate not rising at a 7.0% Y/Y rate, but is in fact the LOWEST IT HAS BEEN IN MODERN HISTORY! And a 1.6% growth rate by what was formerly the world’s most rapidly growing (and largest according to the IMF) economy explains perfectly what happened with the US economy over the past 6 months. Hint: it has nothing to do with the winter, and everything to do with China hard landing into a brick wall.”

http://www.zerohedge.com/news/2015-04-15/chinas-true-economic-growth-rate-16

Gee, I wonder what kind of affect this will eventually have on the Chinese stock market?