Bits Bucket for May 16, 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.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
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View the HBB Photo Gallery *updated 4/13/2008
Flowers, letters, and gifts:
http://www.thedenverchannel.com/news/local-news/first-time-home-buyers-courting-denver-metro-homeowners-with-flowers-letters-and-gifts05142015
Region VIII
What’s the inflow rate of Californians into Colorado?
Just curious.
Better yet, whats the net outflow from CA and CO?
California’s high housing costs drive out poor, middle-income workers
California out-migration up for poor, middle income
According to data from the Census’ Current Population Survey, those moving out of California over the last 15 years listed housing as one of the most common factors, behind only family and job concerns. Above, a banner advertising new homes for sale in Alhambra in 2013. (Frederic J. Brown, AFP/Getty Images)
By Chris Kirkham
Nearly three-quarters of those who left California for other states since 2007 earn less than $50,000 a year
‘The new frontier has not been “Go west, young man.” ‘It’s “Go east” if you’re in Cali
California’s high cost of living has pushed hundreds of thousands of low- and middle-income workers to other states, federal data show.
The trend points to a challenge for the state’s economy: how to attract workers of moderate means to some of the nation’s most expensive housing markets.
The state overall has been losing people to other parts of the country since the 1990s. A snapshot of more recent U.S. Census migration numbers shows that nearly three-quarters of those who have left California for other states since 2007 earn less than $50,000 a year.
Experts point to the state’s increasingly unaffordable real estate markets as a major driver of the trends. More than half of the nation’s 50 most expensive residential real estate markets are in California, according to Coldwell Banker’s Home Listing Report, including nine of the top 10.
“It’s getting harder and harder for the middle-class Californian to buy a home,” said Jordan Levine, director of economic research at Los Angeles’ Beacon Economics, who points to the migration trends as a major hurdle for the state’s future economic growth. “People just keep looking for ways to maximize that residential dollar. That attracts people to inland areas of the state and to other states.”
Those moving to California tend to have higher incomes. About 35% of working-age people moving in make more than $50,000 annually, compared with 27% of those moving out.
The disparity gets progressively pronounced at the lower end of the income scale.
For those making $40,000 to $49,999, for instance, the net loss of population is 15,403 residents since 2007. The loss is 22,754 residents in the $30,000 to $39,999 range, then more than doubles to 46,318 residents in the $20,000 to $29,999 range.
“Housing prices are a primary factor, because that’s usually the first thing you deal with when you’re moving,” said Dowell Myers, a professor of demography and urban planning at USC.
Census surveys back that up. According to data from the Census’ Current Population Survey, those moving out of the state over the last 15 years listed housing as one of the most common factors, behind only family and job concerns.
…
“What’s the inflow rate of Californians into Colorado?”
Whatever the number, I move that it be doubled.
What’s the inflow rate of Californians into Colorado?
Way too high. Montana has it even worse. They ruined the Golden State with their mindless liberal statism, now they bring the same attitudes and voting patterns to what used to be the freer western states.
“… now they bring the same attitudes and voting patterns to what used to be the freer western states.”
I like to think of these things as exports. And I would like to see these exports doubled.
How high? Let’s go to the videotape:
U-Haul 20″ truck one-way:
Bakersfield to Denver: $1647
Denver to Bakersfield: $913
Bakersfield to Bozeman: $2577
Bozeman to Bakersfield: $612
And for the heck of it:
Bozeman to Denver: $654
Denver to Bozeman: $654 (wow, I’ve never seen that.)
What’s the inflow rate of Californians into Colorado?
From what I have seen first hand, the inflow is more likely to come from the midwest. On a Saturday during college football season the number of people flying Nebraska Big Red flags from their front porches is non trivial. Also see A LOT of Green Bay Packers flags (in Broncos country no less). When the Rockies play the Cubs, the Chicago jerseys far outnumber the Denver ones in the stands, big time. I once went to a Dodgers/Rockies games and hardly saw any LA jerseys.
When my Santa Clara colleagues complain about the cost of houses in their neck of the woods, I suggest they transfer out here. Their typical response is to laugh. They are not interested, you know, because it snows here. That reminds me of a remark Ben made recently, that he was in a bay area store when an alarm sounded and everyone covered their ears and writhed in agony, his comment being “These people are soft”, and I agree, they are. Heck, they won’t even come out here on business trips in the winter, because they’re afraid of driving in the snow.
What, no Red Wings jerseys when the Avs play?
What’s the inflow rate of Californians into Colorado?
I think they are more likely to move to warmer states: Nevada, Arizona, New Mexico and Texas.
Maybe 2 banana is right about retirees moving to a low-tax state.
Maybe 2 banana is right about retirees moving to a low-tax state.
Utah and Colorado are low tax, but it snows in both states. Scary stuff for Californians.
“but it snows in both states.”
Not for much longer below 6,000′
Historian Says Don’t ‘Sanitize’ How Our Government Created Ghettos
May 14, 2015 3:16 PM ET
Fresh Air
A helicopter flies over a section of Baltimore affected by riots. Richard Rothstein writes that recent unrest in Baltimore is the legacy of a century of federal, state and local policies designed to “quarantine Baltimore’s black population in isolated slums.”
Link to transcript:
http://www.npr.org/templates/transcript/transcript.php?storyId=406699264
“GROSS: I suppose one should never be surprised by the extent of racism in America. But it’s still shocking that that would be legal in the North, where there wasn’t legal segregation.
ROTHSTEIN: But there was. This was not legal; it was unconstitutional. But this was the policy the federal government followed. As I said, it was once well known. You know, in 1970, George Romney, who was the secretary of housing and urban development under Nixon, the father of the recent presidential candidate, announced that the federal government had created a white noose around African-American neighborhoods - Negro neighborhoods, he called them - in central cities. And it was the federal government’s obligation now to untie that noose. And Romney implemented a series of policies designed to integrate the suburbs, to reverse the policies that had been pursued in the previous 20 years. He proposed to withhold federal funds for all kinds of things, sewer projects or water projects or parklands, from any suburban community that didn’t desegregate, by repealing ordinances that prohibited the construction of multifamily units or that didn’t take their fair share of public housing throughout the metropolitan area or that didn’t accept subsidized housing. And he actually - Romney actually did withhold federal funds from three suburbs as his first round of this policy. He called it Open Communities. And there was such an uproar in the country about it that President Nixon reined him in. Romney was forced to cancel the Open Communities program. He was eventually forced out as secretary of housing and urban development. And we’ve had nothing since from the federal government that was anywhere near as aggressive in trying to reverse the policies that the federal government had pursued to create segregation.”
That’s racist. And speaking of racist, repost from a few days ago about some racist Hasidic Jewish landlord who bribes his black tenants to move out so he can double the rents for whitey moving in:
http://nymag.com/daily/intelligencer/2015/05/grim-racist-methods-of-one-brooklyn-landlord.html
Link with comments:
http://www.npr.org/2015/05/14/406699264/historian-says-dont-sanitize-how-our-government-created-the-ghettos
“On the Federal Housing Administration’s overtly racist policies in the 1930s, ’40s and ’50s”
I guess the FHA ended its overtly racist policies over fifty years ago?
Here it is in plain English:
Fair Housing Act
Title VIII of the Civil Rights Act of 1968 (Fair Housing Act), as amended, prohibits discrimination in the sale, rental, and financing of dwellings, and in other housing-related transactions, based on race, color, national origin, religion, sex, familial status (including children under the age of 18 living with parents or legal custodians, pregnant women, and people securing custody of children under the age of 18), and disability.
Would programs that overtly target loans at some select group of individuals based on ethnicity be considered racist?
Home Guides
Mortgage Programs for Minorities
by Amber Keefer, Demand Media
Government programs are available to assist minority families to achieve homeownership.
Several programs sponsored by the federal government offer a variety of financing strategies to help make homeownership affordable to more Americans. Many of these programs specifically target minority households, which traditionally have been underserved in the mortgage industry. Some mortgage programs partner with other governmental agencies, lending institutions and community nonprofit organizations to help make the dream of owning a home come true for more families across the nation.
The U.S. Department of Housing and Urban Development’s (HUD) Office of Native American Programs offers housing assistance for Native American families (see Resources). The goal of these programs is to ensure that low-income Native Americans can obtain affordable and safe housing and are offered opportunities for homeownership. Income-eligible American Indian, Alaska Native and Native Hawaiian families can apply for the affordable housing opportunities these programs offer.
Fannie Mae
Fannie Mae offers mortgage programs designed to help families and individuals with low to moderate incomes. Lenders offer mortgage options that can help minority applicants afford and qualify for a mortgage loan (see Resources). Some of the benefits of these loan programs include lower closing costs, lower down payment requirements, credit opportunities for those with little credit history or less than ideal credit, in addition to a number of repayment options. Fannie Mae is active in the communities it serves and works closely with other organizations to help ensure that more people can get mortgages to buy their own homes.
FHA Loans
The Federal Housing Administration offers loan programs that can help minorities who want to be homeowners. Individuals do not need to have a high credit score to be eligible for an FHA-guaranteed loan as it is easier to qualify than when applying for a conventional home mortgage loan. Another benefit of applying for an FHA loan is that approved lenders require a lower down payment, as little as 3 percent, according to HUD. This makes it possible for people who can afford a mortgage but who do not have enough money to cover a higher down payment to still be able to buy a home. Interest rates are also lower.
Fair Lending Enforcement Program
The Fair Lending Enforcement Program is a government program that is used to make certain that mortgage lenders follow the Fair Housing Act and Equal Credit Opportunity Act. Under these acts, the law prohibits unfair lending practices, as lenders may not discriminate against a loan applicant based on age, sex, race or other factors. The U.S. Department of Justice reports that more minority families have become homeowners since the introduction of these acts more than 25 years ago.
Duck typing test for discrimination:
It could be a mallard.
ft dot com
Have bonds reached a tipping point?
John Authers
“Look at the world around you. It may seem like an immovable, implacable place. It is not. With the slightest push — in just the right place — it can be tipped.” - Malcolm Gladwell
Have world bond markets finally reached the tipping point? Back in February, this column carried the following warning in its headline: “The bond market must turn sometime”. And indeed, in the past three weeks, it has turned dramatically.
Was this an example of great prescience? No. This column had been warning for about a decade that the great bull market in bonds must end sometime soon. That bull market is now more than three decades old and it is still intact. The long-term trend in bond yields remains firmly down.
Second, it remains quite possible that this latest incident is not a tipping point.
True, German Bund yields have enjoyed a spectacular reverse, giving up five months of gains in a matter of days.
But this only brings them to levels lower than ever seen before December last year. They still signal deep negativity about the German and eurozone economies.
Many false “tipping points” preceded this incident — most recently the “taper tantrum”, when yields shot up around the world in May 2013 after Ben Bernanke of the Federal Reserve speculated about “tapering off” bond purchases made under its quantitative easing programme.
A third problem for anyone who likes to call history to their aid is that this time is undeniably different.
Usually these words spell disaster. But we have never before seen the European Central Bank resort to QE bond purchases, while in the US the Federal Reserve has never before tried to return its policy to normal after a dose of QE.
It is also hard to find a precedent for the state of regulation. During the last decade, liberal regulation made it easier for large banks to trade bonds, ensuring a liquid market. Liquidity, as measured by total volumes, is retreating, although it remains higher than a decade ago.
Neither those who argue that rate rises could lead to severe market disruption, nor those who pooh-pooh such claims, can cite any historical evidence.
…
Is there any liquidity in the bond markets beyond the central banks?
Why isnt there a limit on all this borrowing?
Essentially it appears money is created out of thin air to support huge deficits because the private sector cant provide the revenue.
Why isnt there a limit on all this borrowing?
Because they would have to raise taxes significantly. And not just here, this is everywhere in the world. “Business friendly” nations want to keep their taxes low so as not to scare away multinationals. It’s a race to the bottom, and as long as central banks print away and keep interest rates low it is the most politically palatable choice around the globe.
How the Boomers are preying on their grandchildren.
http://www.zerohedge.com/news/2015-05-15/are-you-ready-coming-debt-revolution
That’s not what that article says. The Boomer judgement is yours. My daughter is a Millennial and her grandmother was born in 1928. It is not the single age segment you blame that is responsible for the debt. It is the oligarchy that learned how to game the system for their own personal greed. Likely a lot of people from the baby boomer generation will never see any of the SS benefits they paid in to all their working lives. While billionaires complain about all the old people.
http://www.zerohedge.com/news/2015-05-14/obamas-tax-rich-plan-futile-druckenmiller-warns-americas-aging-population-massive-ma
t is the oligarchy that learned how to game the system for their own personal greed. Likely a lot of people from the baby boomer generation will never see any of the SS benefits they paid in to all their working lives.
I thought we already ran you off once. With your cheerleading for Hillary Clinton, you’ve already established yourself as a dupe for the .1% that is robbing the rest of the country blind. They own HillaryJeb and count on the mindlessness of sheep like you to keep electing their water carriers.
Please go away, and stay gone this time.
Napa, CA Sale Prices Sink 6% YoY; Falling Housing Prices Spread
http://www.zillow.com/napa-ca/home-values/
US Housing Demand Plunges To 20 Year Low
http://2.bp.blogspot.com/-fqSztKilps8/VFlPKlr52JI/AAAAAAAAhKU/v5oS41S-y0s/s1600/MBANov52014.PNG
I can ask $50k for my 10 year old Chevy truck but where is the buyer at that price?
So it is with any depreciating asset like a house.
If you are going to be mostly in stock funds, it would be wise to increase your exposure to international stocks and decrease the large U.S. Stock funds. The surveillance state is coddling the big U.S. companies in exchange for more information on us. Coddling in the form explained in Glenn Greenwald’s book. When the citizens have had enough and demand it all stop, the unfair advantage given to U.S. Companies will fall and profits will fall. Internationally, I would avoid Stocks in Great Britain because it is a big spy partner to the USA. In fact, avoid all English speaking white countries’ stocks if you can.
International stocks? What if I told you that those countries don’t even pay lip service to not spying on their citizens. Put down the paranoia.
If gold is a barbarous relic then why do central banks keep buying it?
http://www.kitco.com/commentaries/2015-05-15/Central-Banks-Asian-Consumers-Remain-Committed-Gold-Buyers.html
“Price weakness in gold in recent weeks has also attracted fresh buying interest from Chinese and Indian consumers as a pick-up in gold exports from Switzerland to China has been noted.”
It’s widely known that the Chinese are looking for places to put their money and, along with art and houses, gold is an available place to do this.
But available doesn’t necessarily mean prudent.
BTW, here’s a 20 year price chart for gold:
http://finviz.com/futures_charts.ashx?t=GC&p=m1
Thanks. yes and it kind of makes me think that gold prices could be 1/3 as much as its 2011 peak just as in the year 2001, gold prices were 1/3 of its 1980 peak. However I don’t know what the cost of mining gold was around the year 2001.
Gold was way undervalued for most of those years - that is what the chart indicates.
Gold is not pegged to the USD. You did not show the chart from 1970 to 2015. In 1970 gold was $35 per ounce. So in 2011 the POG was about 54 times its 1970 price. 5400% is just about as much as the gain on the Vanguard 500 index fund since inception date August 1976.
It peaked in 2011 and is now in the slow burn phase of a long term correction. When the Fed takes away the punch bowl, look for the downtrend to accelerate.
And what is it that Schiff guy is smoking?
Commodities Corner
Published: May 15, 2015
Schiff: upside potential in gold equities is ‘phenomenal’
By Myra P. Saefong
Markets/commodities reporter
Peter Schiff, more bullish than ever, sees gold headed to $5,000 an oz.
Despite a ho-hum performance year to date for gold, Peter Schiff, chief executive officer at Euro Pacific Capital, is still betting on gold’s eventual climb to $5,000 an ounce.
Schiff’s persistent call is more than 300% higher than Thursday’s settlement at $1,225.20 an ounce on Comex, which marked the highest close for the yellow metal since mid-February.
Gold is roughly 3% higher year to date, but the precious metal seems light year’s away from the all-time highs near $1,900 reached in 2011.
Still, gold’s performance hasn’t been particularly exciting in recent months. Prices GCM5, -0.18% tallied declines for the last three months in a row. They logged declines last year and the year prior.
Gold’s sluggishness makes Schiff’s dogged call on gold all the more notable.
Over the years, he’s reiterated his long-running gold-price forecast, which has yet to come to fruition. Lately, however, he’s sounding even more bullish.
“There really is no limit to how high gold prices can rise,” he told MarketWatch in a phone interview recently.
…
“’There really is no limit to how high gold prices can rise,’ he told MarketWatch in a phone interview recently.”
This is true because there is no way to value the stuff except for the price.
There is a lower limit on how low gold prices can fall of $0, because they aren’t gonna just give it away.
Schiff has been talking up gold prices forever because he has huge amounts invested in it. It’s nauseating. I can’t stand that guy.
He’s no different that Bill Ackman talking down Herbalife. All these guys are doing is trying to use the media to grow their own personal net worth, yet they try to slant it like they’re helping other people. They are creepy greedheads.
Let’s see. Peter Schiff is so powerful that he can talk up gold, and influence all the Chinese and Indians and central bankers to buy gold.
Got it.
I have a bridge for sale too.,
Schiff has been talking up
He’s no different that Bill Ackman
Way to reply to yourself. At least Schiff never pretends to be anyone else—whether I agree or disagree, he is self-consistent.
POG is 7.3% above its five year low.
Market cycles. Fiat has to flow into something that has been lagging. When the long term interest rates go up the bonds and stocks will be like hot potatos and the selloff means that the cash will flow into the laggards.
Some people just cannot admit it - they are so much invested in their own memes. Like my friend is so invested in his fuzzy headed “progressivism” that he always switches the subject when I directly ask him which type of initiation of force is he in favor of?
“Fiat has to flow into something that has been lagging.”
Or it can be allowed to sit right where it is.
Especially if its value is rising relative to real assets like gold or housing.
The fact that central banks have overtly declared a war on deflation should lead you to suspect this is not a sustainable condition.
“Fiat has to flow into something that has been lagging.”
This statement needs to be re-visited:
If the allure of gold is its value and its value is measured via its price then the allure of gold is tied directly to its price.
But something that has its value tied to its price becomes more attractive as the prices rises and less attractive as its price declines. So as the price of gold declines the attractiveness of gold should also decline.
Hence the incentive for fiat is to steer clear of gold because gold’s price has been lagging.
The one scenario that I cannot rule out which would make gold hoarders very very wealthy is a concerted effort by central banks to return the world to the stagflationary conditions of the 1970s. I call that “throw Grandma under the bus” monetary policy, as many elderly folks with bond-heavy or pension-heavy portfolios would take a massive hit.
Given the graying of the voter population here in America, I’m not expecting this to occur.
Actually the small investors in bonds are in favor of interest rate hikes. They care about bond income. Institutional investors care about bond prices. Institutional investors own most of the bonds. The elderly and fixed income types hate the low rates on their CDs and bonds and would sell them to buy longer term yields.
“Actually the small investors in bonds are in favor of interest rate hikes.”
Are you talking about long-term or short-term bonds?
If long-term, are you talking about small investors who currently own a large number of these, or those who would like to some day own a large number?
“If long-term, are you talking about small investors who currently own a large number of these, or those who would like to some day own a large number?”
Both.
As a small investor, I would like to own long term bonds - to pay my rent. Like I do with my savings bonds and municipal bonds. But if I was a mutual fund manager actively managing a fund I would be moving out of long term ones into shorter duration.
I would personally want a lot of 10 and 20 year bonds. But not now. Rates are still too low.
“I would personally want a lot of 10 and 20 year bonds. But not now. Rates are still too low.”
That’s it. Why buy now when you can get them at 50 percent discount in a few years?
A small allocation (3%-5%) to precious metals helps to diversify and stabilize a portfolio.
True dat. My current percentage is a little higher, but under 10%. I’d be sleeping more easily if I had 15% of my assets in a mix of gold, silver, and platinum physical bullion. But my purchase schedule is basically twice a year, Spring and Fall. The rest of the time I build up cash under my mattress every week.
Update: Bill has moved his gold.
It is no longer in the pantry behind the oatmeal-it is now in the oatmeal.
“Update: Bill has moved his gold.”
How funny, this is true. I did so a week ago.
I know.
We know you’ve been monitoring his stools for oatmeal and gold residue.
How did you land that gig?
If I owned gold, I would never talk about it. In fact, I would not talk about anything financial online. I do not trust our spying government one bit. I’m sure they have an intricate system to log all data by IP address, cell phone, location, etc. They can basically build an entire profile for each person, combining all social media accounts, and all forum comments made by anyone using that specific IP. A LOT of information can be gleaned.
Sadly, I am bereft of gold or guns, having lost them in a most unfortunate boating accident.
Someones got it right. What guns?
“Sadly, I am bereft of gold or guns, having lost them in a most unfortunate boating accident.”
“That’s a shame. Now, if you’ll pardon us, we’ve got this little search warrant thingy to execute. Surely we won’t be stumbling upon any guns or anything now, will we? Step aside, sir, and I won’t ask again.”
In his stomach now. He’s dusted his gold, filled them in condoms and swallowed. Atta boy, Bill!
“…why do central banks keep buying it?”
Judging from the extreme stickiness of gold around $1200/oz, you almost get the impression the Fed uses the gold price as a sort of dollar peg.
As I stated a few years ago when you asked where the bottom of gold would occur and people were talking about an $800 price, $1200 reflects the cost of production ignoring sunk costs in many mines, thus it cannot be manipulated below that price for very long. Sooner or later probably sooner, it will go far above that price but it is likely to make the move very quickly when the manipulation fails, at that point you are going to want to own it.
You no more understand gold extraction than you do crude or natural ga.
Is oil gonna crater again? Your doomsday scenarios are never panning out.
You have missed a 6 year bull market again.
King Dollar Poet….. King Dollar.
Update: Crude Oil Plummets 40% YoY
http://www.marketwatch.com/investing/future/crude%20oil%20-%20electronic
The cost of producing gold is rather imaginary, and the quantity produced has little to do with its market price when it is obtained as a by product of copper mining.
It’s like housing. When you have millions of excess houses already, the cost to build one more is not the price floor.
“…$1200 reflects the cost of production ignoring sunk costs in many mines…”
Your lawerly focus on production costs is missing it again. Let’s compare notes on whether interest rates mattered once Fed liftoff occurs later this year.
Your lawerly focus on production costs is missing it again.
So why is gold price allowed to respond to manipulation and not production costs, but house prices must needs respond not to manipulation but instead to HA’s squawking about production costs of $50/sq ft?
Wallowing isn’t going to help Donk.
One thought Oxy, gold is a store of wealth. Mortgaged overpriced houses are destroyers of wealth.
If banks keep buying it, why have prices been falling?
Santa Ana, CA List Prices Sink 5% YoY At Peak Of Season
http://www.movoto.com/santa-ana-ca/market-trends/
Cathedral Heights, Washington DC List Prices Crater 12% YoY
http://www.zillow.com/cathedral-heights-washington-dc/home-values/
CraterRage Photo Of The Day
https://goo.gl/o7uxWV
50% haircut on the asking price of the “Scarface” mansion. Ouch.
http://www.businessinsider.com/scarface-mansion-on-sale-for-18-million-2015-5
Does it come with his little friend?
Strong Dollar Makes U.S. Real Estate Less Attractive to Foreigners
Buyers paying in rubles, euros or Canadian dollars see much higher prices in key markets
By Eric Morath
Updated May 15, 2015 2:27 p.m. ET
For a Russian investor using rubles, for example, the price of Miami real estate was twice as high in February as it was a year earlier, according to Zillow data. A resident of the eurozone buying in New York City faced a 24% price increase during that time, and a Canadian now has to pay 20% more to buy a vacation home in the Phoenix area.
http://www.wsj.com/articles/strong-dollar-makes-u-s-real-estate-less-attractive-to-foreigners-1431713598
From rupees to rubles to Donk’s Space Duckets…. it’s falling prices.
Remember…. falling prices to dramatically lower and more affordable levels is positively bullish and good for the economy.
And I expect the USD to get stronger as rates go up, just like it strengthened in the late 70s. Houses, bonds, and stocks were like a contagious disease and no one wanted them. They wanted gold and silver.
Real estate did very well in the 1970’s in part because of the high inflation during that period.
ehhhhh no it didn’t. Cash did very well. Housing wasn’t something anyone wanted in the 70’s. We’re returning to that environment very quickly.
The strong dollar is hopefully a nail in the coffin of the foreign investor horde that has recently driven housing prices out of reach for American families.
Gotta a love an increasingly valuable dollar.
OPPORTUNITY COSTS?
No lost opportunity with a big fat pile of cash Poet.
U have lost a lot of cash being afraid of risk. People who buy assets get rewarded nicely with lots of cash.
King Dollar Poet. King Dollar.
Remember….. Falling prices to dramatically lower and more affordable levels is positively bullish and good for the economy.
Hillary in action:
http://www.washingtonpost.com/blogs/post-politics/wp/2015/05/14/hillary-clintons-litmus-test-for-supreme-court-nominees-a-pledge-to-overturn-citizens-united/?wprss=rss_homepage
Hillary the Movie:
https://www.youtube.com/watch?v=9IOpbj8ajZs
(run time = 90 minutes)
The Chinese are buying everything up:
http://www.dailymail.co.uk/news/peoplesdaily/article-3083293/Chinese-billionaire-pays-5million-hire-Japanese-porn-star-personal-assistant-15-years.html
The saying is true: Some women are sitting on a gold mine.
Just another example of the Chinese buying up all the real estate down under.
He is telling the truth:
http://theweek.com/speedreads/555258/isis-leader-islam-never-religion-peace
We have been getting the usual heavy afternoon rains in South Florida for the past couple of weeks and I am still waiting for the 2 feet of water to show up in living rooms that President Obama said happened every time it rains here proving you can’t deny that climate change is real.
Yours truly
Phony the Denier
“They want a final push to just totally smear and discredit skeptics,”
CLIMATE:
There’s no denying this label packs a political punch (a very weak punch)
Jean Chemnick, E&E reporter
Greenwire: Friday, May 15, 2015
Marshall and co-author Mark Lynas published the first reference to “climate denier” in the English-language press in a 2003 op-ed they wrote for the left-leaning magazine The New Statesman.
They wanted those words to sting.
They did — and still do.
In 2000, “denier” was referenced 10 times in the English-language press.
In 2014, it appeared 3,183 times.
“Ultimately, this is all about having an upper hand in the war of words,” said Kert Davies of Greenpeace U.S. “And it’s proven out now that it actually does hurt to be called a denier.”
But Morano says the Obama administration and its allies are deliberately using the “denier” label to “intimidate and silence” their political opponents while they drive through their agenda.
The term is being used more frequently, he said, because greens know the last years of the Obama administration are their best chance to win carbon regulations at home and a climate agreement abroad, he said.
“They want a final push to just totally smear and discredit skeptics,” he said. “The reins of power right now are on their side.”
But “denier” effectively means “liar,” and that’s a risky message, Morano said.
“I don’t like to say someone’s a liar in political discourse, because it takes away from your case. You become the issue, and whatever language you use to say it,” he said.
http://www.eenews.net/stories/1060018646 - 48k -
We’ve been getting the unusual weekend rains here in San Diego — never seen it before in May! I’m feeling a bit guilty over praying for rain on a day when my neighbors have their junk spread all over their driveways for garage sales.
Rats! Last month I buried a weather vane in my back yard but I must have pointed it wrong because most of the rain is coming to you.
And we forgot to bury a statue of St. Joseph in my parent’s yard 4 miles east of Ferguson, which probably explains why we got such a crappy sale price.
That’s what you get for being LDS
When that ice shelf in Antarctica breaks off, you may want to put your Florida home on stilts.
“When that ice shelf in Antarctica breaks off, you may want to put your Florida home on stilts.”
Useful idiot
From Wikipedia
In political jargon, useful idiot is a term for people perceived as propagandists for a cause whose goals they are not fully aware of, and who are used cynically by the leaders of the cause. Despite often being attributed to Vladimir Lenin,[1][2][3] in 1987, Grant Harris, senior reference librarian at the Library of Congress, declared that “We have not been able to identify this phrase among [Lenin's] published works.”[4][5]
In the Russian language, the equivalent term “useful fools” (полезные дураки, tr. polezniye duraki) was in use at least in 1941.[6]
Too big to jail
5 Big Banks Expected to Plead Guilty to Felony Charges, but Punishments May Be Tempered
By BEN PROTESS and MICHAEL CORKERYMAY 13, 2015
For most people, pleading guilty to a felony means they will very likely land in prison, lose their job and forfeit their right to vote.
But when five of the world’s biggest banks plead guilty to an array of antitrust and fraud charges as soon as next week, life will go on, probably without much of a hiccup.
The Justice Department is preparing to announce that Barclays, JPMorgan Chase, Citigroup and the Royal Bank of Scotland will collectively pay several billion dollars and plead guilty to criminal antitrust violations for rigging the price of foreign currencies, according to people briefed on the matter who spoke on the condition of anonymity. Most if not all of the pleas are expected to come from the banks’ holding companies, the people said — a first for Wall Street giants that until now have had only subsidiaries or their biggest banking units plead guilty.
The Justice Department is also preparing to resolve accusations of foreign currency misconduct at UBS. As part of that deal, prosecutors are taking the rare step of tearing up a 2012 nonprosecution agreement with the bank over the manipulation of benchmark interest rates, the people said, citing the bank’s foreign currency misconduct as a violation of the earlier agreement. UBS A.G., the banking unit that signed the 2012 nonprosecution agreement, is expected to plead guilty to the earlier charges and pay a fine that could be as high as $500 million rather than go to trial, the people said.
http://www.nytimes.com/…ead-guilty-to-felony-charges-but-punishments-may-be-tempered.html -
Free Jon Corzine!
Oh, wait….
Any thoughts on how much longer the non-fundamentals based rally in oil prices will continue before the next leg down?
This dead cat bounce must be one of the longest in history!
ft dot com > Markets >
Commodities
Global Economy Lex Comment Management Life & Arts
May 15, 2015 1:59 pm
Hedge funds loom large in oil price moves
David Sheppard and Neil Hume
Forget the interplay between supply and demand. When it comes to oil prices, hedge funds and speculators are exerting an uncommonly large influence, say many in one of the world’s most important markets.
Oil traders have watched future prices rally to their highest level this year, within touching distance of $70 a barrel, even as the price of physical cargoes flounders under the weight of a massive oversupply.
In an attempt to explain the conundrum, experienced traders are pointing at the influence of multibillion-dollar macro funds. While much of the increase in speculative demand has been driven by a perceived improvement in oil fundamentals, as US drillers have curtailed activity, other factors have been at work.
Traders say funds have bought oil futures not just as a bet on an eventual oil price recovery, but as a hedge against a weaker US dollar, rising government bond yields and shifting inflation expectations, which have roiled the bigger part of their portfolios.
“Ultimately, the dominant force in the crude market today is macro funds, with talk of diversification and inflation back on the agenda,” says Energy Aspects, a London-based consultant.
“Some of these multibillion-dollar macro funds may only be putting 1 per cent of their portfolio in oil, but that is enough to dwarf far smaller fundamentally focused funds at times.”
After the European Central Bank announced the launch of quantitative easing in January, a popular trade was to sell euros and buy the German Bund and US dollar.
But German 10-year Bund yields have risen towards 0.70 per cent after threatening to turn negative last month. That has led some funds to start unwinding the trade or look at additional hedges for large positions they might struggle to exit quickly.
“If you fear a Bund price fall driven by inflation, then buying Brent provides some protection,” says David Hufton, chief executive of PVM, an oil broker. The correlation between Brent and Bund yields is more than 90 per cent, he adds.
More broadly, buying oil when the dollar weakens also acts as an offsetting position for some investors, given most commodities are priced in the world’s reserve currency.
The dollar was a contributing factor to oil’s crash between June and January as it rose 16 per cent against a basket of other currencies. However, the 60 per cent decline in crude from about $115 to $45 a barrel over the same period illustrates how crude was largely trading on its own fundamentals, as the US shale boom contributed to oversupply.
But the scale of futures based trading in the oil market is immense, and an important driver of prices.
During the past decade there has been a surge in the volume of crude contracts traded on ICE and Nymex, the main commodity exchanges. Daily average turnover has increased from 350,000 futures contracts in 2005, when electronic trading started to dominate, to 1.5m — or 16 times the world’s global daily oil demand — according to calculations by the Financial Times.
Exchange and regulatory data show that funds hold net positions in futures and options markets in London and New York equivalent to about 510m barrels of crude. That is equal to more than five days of global demand, or the combined monthly output of Saudi Arabia, Iraq and Iran, the biggest producers in Opec.
Some investors are warning that fund buying could dry up or reverse, putting pressure on prices. When oil was $10 lower “there was a lot of hedge fund interest in buying oil as it looked oversold”, says one manager of a fund-of-funds in London. “But there’s less interest now after the rally, as it has started to look a little too extended.”
…
The dead cat bounce in oil futures is nothing compared to the one in housing.
HillaryJeb - anti-war / conscientious objector in the 1960s now both Fascists:
http://www.thetimesnews.com/opinion/opinion-columns/still-struggling-with-the-60s-1.420985
“Hillary Rodham Clinton spoke out against the Vietnam War back in 1968, as a student leader at Wellesley College. Intriguingly, though, Republican Jeb Bush’s mother, Barbara Bush, was quoted in a 1984 interview as saying that he considered applying for conscientious objector status during Vietnam.”
“The America that I grew up in in the 1950s,” he said, “was monochromatic in every sense of the word. It was a land without options. … ”
I, too, grew up in the 1950s and that wasn’t quite the way I remember it.
“The paradigm of uniformity that we were all born into died, and it was replaced by choices and options — maybe by now to such a degree that all those choices are a dilemma.”
“… all those choices are a dilemma.”
I love these guys.
“The America that I grew up in in the 1950s,” he said, “was monochromatic in every sense of the word. It was a land without options. … ”
I, too, grew up in the 1950s and that wasn’t quite the way I remember it.
Oh, well, you’ve got your opinion and David Harris has his.
“I, too, grew up in the 1950s and that wasn’t quite the way I remember it.”
Same here. Only the TV was monochrome.
“Republican Jeb Bush’s mother, Barbara Bush, was quoted in a 1984 interview as saying that he considered applying for conscientious objector status during Vietnam.”
Not that he was really a conscientious objector. He just din’ wanna go. Not that I blame him, but really it was one way to avoid the draft. Of course, he’d have no conscientious objections to ordering troops to the Ukraine or the Middle East, toot sweet.
He has no objections to ordering other people’s kids to fight his neo-con wars.
It wasn’t exactly easy to get CO status. Some students who wrote the letter instantly lost their student deferment and were called up in the draft as a reward. You could go to jail for five years if you wouldn’t take the oath, then you got a second chance.
Jeb is being called out for his insistence that George Bush was right to invade Iraq.
http://www.theguardian.com/us-news/2015/may/15/jeb-bush-iraq-war-ivy-zietrich-isis-george-w-bush
Sheldon Adelson’s GOP hirelings are “flabbergasted” that Jeb Bush didn’t dissemble more convincingly when asked about his brother’s disastrous track record in Iraq.
http://thehill.com/homenews/house/242256-gop-lawmakers-flabbergasted-by-bush-stumbles-on-iraq
Not that I want another Bush, but is not being a slick talker really the criteria we want to use?
I have more important criteria.
Failing to learn from the epic incompetence of his brother’s administration is the issue, not being a slick talker. Obama might be more articulate and intelligent than Bush, but that hasn’t made him a better leader.
I wonder how much debt the next one will rack up?
Is it time to raise the debt ceiling again?
How can uncle fed raise rates when they are buying most of the treasuries via the primary dealers?
In order to raise rates they wouldnt they have to sell treasuries and pull cash out of the economy?
Is it just an illusion? something isnt making any sense here.
Doesn’t much matter what they do Poet. Demand is collapsing globally.
R U AN ECONOMIST NOW?
Data Poet data…
Ashburn, VA Sale Prices Crater 10% YoY; 2010-2013 Homebuyers Now Underwater
Lower demand means lower prices. A win win!
A personal appeal to pet owners and animal lovers: never, ever reward the puppy mill industry by buying from non-reputable pet shops or breeders. And while most of the sheeple have shown they don’t care about cruelty or injustice unless it affects them personally, try to raise awareness of how these animals are treated. I have seen first-hand how damaged the dogs that come out of these places can be, after adopting a rescue dog, and would like to jail the SOBs responsible.
http://www.independent.co.uk/news/uk/home-news/cruelty-and-squalor-of-uk-puppy-farms-to-be-to-be-exposed-in-documentary-the-dog-factory-10255147.html