Bits Bucket for May 27, 2015
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Mobility is my greatest asset, loanowners live in a financial prison of their own creation
Get on the property ladder you looser…
That’s right.
Remember…. Houses are depreciating assets that cost you money every day you owe them.
why cant renters get any respect?
Respect your wallet Poet and remember…… Current asking prices of resale housing are 300% higher than long term trend and 2x construction costs.
And grossly inflated prices means collapsing demand. See for yourself.
US Housing Demand Plunges To 20 Year Low
http://2.bp.blogspot.com/-fqSztKilps8/VFlPKlr52JI/AAAAAAAAhKU/v5oS41S-y0s/s1600/MBANov52014.PNG
US Housing Demand Plunges To 20 Year Low
It would be more accurate to say that demand for US _mortgages_ plunged to 20-yr lows.
The cash-buyers are also part of the demand function, and they do not show up in that graph.
There are no “cash buyers”.
So people who saved/hoarded cash during the previous run-up and tanking are now letting go of their hard earned cash to buy at another peak? I don’t thinks so. Hard earned money doesn’t gamble.
Margin loans and foreign funny money might be the “cash” side buyers we hear about.
‘foreign funny money might be the “cash” side buyers we hear about.’
And maybe like a counterfeiter willing to pay a cut to a middleman, they might be glad to get back 50 cents on the dollar if they have to unload their “assets” in a hurry.
Hi HA,
I think many variables come into play. Region, price, financed or cash, improvements & maintenance costs, taxes as well. The way we see it, we penciled out how much we could spend to bring up our modest cottage (2,000 sq ft), our accruals at 550/mo (insurance , taxes) and we concluded, we could at least break even. So far, we’re at a small profit. It is all relative to each situation. But I get you, in some cases you’re right.
In our case, we live much cheaper than renting in So Ca (a nice area.) Rents cost you as well. No free lunch, my dear.
You paid a 250% for a depreciating shack with no hope of recovering it which you could have rented.
Your point?
YOUR BROKE RIGHT?
She is broke indeed Poet. That’s what happens when you pay a grossly inflated price for what is always a depreciating asset.
Chino Hills, CA Sale Prices Crater 6% YoY As Housing Correction Ramps Up
http://www.zillow.com/chino-hills-ca/home-values/
Not broke, and doing well. Took an Asset Mgmt job in LIHTC. HA, you’re still an a-hole.
azdude
You’re - no problem, just a one up.
MT Pockets is your painful reality.
Hi inchy,
Rents are tight around here, my friend was considering renting his house got many calls, all people with dogs I think.
his asking price 3K a month in Moorpark for a 3bd 2.5 bath ~1700 sq feet- 2 story off Terra Rejada.
My mortgage is half that.
And your losses to depreciation are? Taxes? Insurance?
HA - some people can do math!
buy low! Sell high! subtract expenses, count profits.
I did it 3x. Ask my bank account.
Nobody is interested in your empty bank account.
just you
Nor I. Just you and your MT Pockets.
buy low! sell high!! then you can call in APPRECIATION!
You can then stay in 5 star resorts in Maui instead of Super in WV.
Math. The horror of the Empty-Pocketed.
Housing Analyst,you and millions of Americans will be slave renters for life.Us landords see our home equity rise 15% yearly and we break the backs of renters who spend 40-60% of their income on rents:}
I will enjoy my Tequila on the beaches of Cancun with 5 pretty senoritas on my side. Thank you renters!!!!
Oh noes….
Chino Hills, CA Sale Prices Crater 6% YoY As Housing Bust Spreads
http://www.zillow.com/chino-hills-ca-91709/home-values/
You could even say they got stucco in a financial prison of their own creation.
Mobility is my greatest asset, loanowners live in a financial prison of their own creation
I can’t decide if my greatest asset is my incredible good looks or my Einstein-like brilliance. Let’s call it a draw.
Houses are somewhat of a burden in this regard. You can’t even really leave for long periods of time without paying people to take care of them. Without yard maintenance, it would become overgrown with weeds/etc. A vacant house attracts vandals and thieves. Houses require constant babysitting.
Once you have kids, staying in one place and one school benefits THEM.
It changes everything.
Up early it is a travel day. A few years ago the Fortune 500 could not finance enough debt with thirty year bonds, it was of the reasons I refinanced my house similarly with the low long term interest rates. Do what the big boys do not what they say. For those claiming that we will have deflation, why would they allow that since we all know that the .01 percent both controls the Federal Reserve Banks and knows the next move of the Fed, Obama appointed their cronies. Isn’t it more logical that the next move is to raise interest rates slowly while promoting inflation to actually make those thirty year bonds plunge in price, allowing the big boys to buy back the bonds at 50 cents on the dollar? Similarly, it would turn Puerto Rico’s 73 billion dollar debt to a $36.5 billion debt, much more manageable. It would be the worker’s pension funds that would take the hit but that is not much of a concern to them. Governments always benefit from inflation in terms of their tax collections. It maybe is the nuclear option that we are about to see. They have given up on promoting real growth, but the Fed can always create real inflation.
“Isn’t it more logical that the next move is to raise interest rates slowly while promoting inflation to actually make those thirty year bonds plunge in price, allowing the big boys to buy back the bonds at 50 cents on the dollar?”
The Fed’s foot dragging on raising rates should play well into getting ‘behind the curve’ on inflation, which is a convenient way to crash the long-term bond market without appearing to have done it deliberately.
The concept of creating inflation by raising interest rates is peculiar.
It is peculiar, and counter intuitive.
However, if you raise interest rates, you need to have a higher return on investment in order to make that investment. This will start to damp down the creation of goods/rent producing assets, restricting supply of those goods or assets that generate the rents, potentially driving the price of goods/rents higher.
This only works however, if there is some semblance of a supply constrained market to begin with.
I’ve used the example previously of industrial real estate (warehouses/distribution facilities–which are at low vacancy rates due in part to the “internetization” of retail).
In many parts of the country, rents are being kept artificially low because of low interest rates.
Low interest rates lead to low cap rates (lower accepted yields by owners of real estate).
Low cap rates lead to more development at lower rent levels (demand by investors at lower yields means that you need to generate less income for a building to sell for a profit).
If you raise interest rates, cap rates will generally rise (although not perfect, there is a correlation).
If you have higher cap rates, development will slow until market rents adjust to provide a higher development yield in order to justify adding supply.
If there is demand for the good/assets, prices/rents will be driven higher through traditional supply/demand forces.
Yes, it is perverse, but it is coming, and one of the reasons I’m holding my REITs despite an expectation that higher yields will in the near term, drive down the capital value of their stock.
In the medium/longer term, there’s a strong rent growth cycle coming.
In the medium/longer term, there’s a strong rent growth cycle coming.
Are you saying rent is going up a lot?
IMHO, Yes. Rent for many types of commercial real estate will go up a lot as interest rates rise. It will take a while (depending on the term of the typical lease), but it will happen. Industrial real estate usually has shorter leases (3-7 years), and so the effect of higher market rents will be pushed to tenants faster than if they had longer leases.
A simple example.
It costs (including land) in the range of $80-$90 per square foot to build a relatively small industrial building in Southern CA (100k sf). The market has low vacancy (less than 5%). Annual income from market rents are probably in the range of $0.45 per square foot per month NNN. This generates approximately a 6.5% yield on cost if you are developing that building.
However, this is OK, because people are paying a 5% cap rate for these buildings in many cases. And they are paying a 5% cap because their cost of capital is quite low (thank you very much Fed), and they are trying to get money to work.
And the developers build because they can make a profit. Build to a 6.5% yield, sell at a 5% yield…profit. Just like bond math. It’s like the yield on your bond fell from 6.5% to 5%–you get a gain in the capital value of the bond if you were to sell it.
So, what happens if rates move by up by 1-2%?
Let’s say the 5% cap rate goes to a 6% cap rate. All of a sudden, it’s much less profitable all else equal. Developers will now try to build to a 7.5% yield (at least). So, how do they get there?
They can try to grind on landowners to sell for less. They can try to build for less, or they can try to get tenants to pay more. In any event, until the math works again, development will slow.
But new development only represents 1-2% of the whole market, so what happens while the math is re-adjusting in a market that is already <5% vacant? Landlords have more power, pushing rents higher–helping to solve the development math that no longer works.
In the example I gave above…unless cost to construct the building goes down by about 13%, rents would need to rise by 20% to offset the 1% rise in cap rates from 5% to 6%.
People like to lump real estate into the same investment universe as bonds. However, they are completely missing the fact that your 30-year bond will never have a higher coupon (unless you pay for that protection vis-a-vis an inflation protected bond). A building can and will generate higher yields as rents rise.
And IMHO, rent levels have been kept artificially low over the prior 10+ years as the debt super-cycle has pushed cap rates lower and lower and lower (thus making it easier to justify new development at lower and lower rents–even though construction costs kept going up).
If this interest rate trend reverses, it will be very hard to keep rents low.
Rental_Fraud,
Rental rates have been artificially inflated in the last 15 years.
“If this interest rate trend reverses, it will be very hard to keep rents low.”
If credit contracts and interest rates rise, it will lower occupancy and rental rates. Sure there will be some “adjustments”.
That’s where the serial delay comes into play. If the Fed gets behind the curve on inflation, they can chase it up to double digit rates, just like in the 1970s.
Remind me how the FED raises interest rates while promoting inflation.
It’s laughable.
The FED can only create inflation if the money they lend out is borrowed by consumers. Consumers with money don’t want to borrow (see recent increase in cash purchases
). Consumers without money can’t borrow.
I have a friend who is a serial refinancer new cars remodels etc. His wife just went back to school for a degree that will provide no job. Borrowed 30k and thought they would just go to the equity bank like they have always done. The look of surprise on his face when the auditor told him his house was worth a 1000 less than when he took out his last equity loan despite pumping 20k into remodel was amazing. A real oh sht moment. The worst part is he has a few kids who will be college age fairly soon and there will be no money to borrow for their education. There will be no new cars vacations remodels etc in his future. The majority of the US is in the same boat. 3rd world slave labor will face downward pressure as US consumes less and automation steals manufacturing jobs.
Here is a laugh for you:
The Free Application for Federal Student Aid (FAFSA) form that you MUST fill out to see what aid you or your child qualifies for…
It asks you the value of your house…
But not the mortgage amount!
Thanks for the laugh. You should take your show on the road.
So that’s a good thing, right?
Credit doesn’t cause inflation.
Since when do you need home equity to take out a student loan?
He wanted to take out an equity loan to pay off her higher interest debt. I had also pointed out that her school debt could never be escaped even if bankrupt
They have given up on promoting real growth, but the Fed can always create real inflation.”
Yea that’s the plan as I see it. Not just me but all stock market and RE investors.
Wellington fund have sold off treasuries and hold more corporate and Junk it looks like. And T Rowe Capital Appreciation looks like almost no bonds. these are both balanced funds not indexes.
They can buy Bonds if they want, they used to hold them.
I do not agree with GS, it just wants to get out of its short positions, but I do agree with the rest of the article, OPEC will not cut at its meeting and that is getting priced into the market, oil will still go up by December because I am seeing the quality of wells in the Bakken plunge and there is no reason to believe that it is different in Eagle Ford. The Saudis know that and can have their cake and eat it to, higher prices and maintain their market share. The Permian play for shale is younger so I would not expect to see quite the fall in quality, OPEC article:
http://www.rigzone.com/news/oil_gas/a/138782/OPEC_Seen_Backing_Saudi_Arabias_Plan_to_Keep_Supplies_Elevated
80% of the super rich in China are under 50, I bet if you compared that to the U.S. you would find 80% of the .1 percent were over 50 and I think that says it all about which way the countries are heading:
http://www.shanghaidaily.com/business/finance/China-now-home-to-1-million-super-rich/shdaily.shtml
Bloomberg:
“LGFVs have become a potent symbol of the country’s post-2008 overindulgence in debt, with local government obligations now exceeding the ENTIRE GERMAN ECONOMY.”
Yep, those local government financing vehicles have really spread the money amongst the party faithful. Too bad none of it’s going to be paid back.
“…by allowing local government to shift their LGFV debt to fresh bonds, the Chinese government has eliminated any remaining semblance of transparency in those markets. Entrepreneurial government officials who want to raise some cash to fund dubious projects now have a license to do so without leaving a paper trail.”
There’s nothing a loyal communist offical hates more than a paper trail.
The definition of the Fed’s household Debt Service Ratio (DSR) is “the ratio of total required household debt payments to total disposable income.” It’s at historic lows. Yet the New York Fed’s report on household debt is near historic highs. Peak debt perhaps.
It seems like contradictory data. What’s going on here? The DSR admits it’s quite hard to calculate. Regardless, it’s an indicator and these two indicators are apparently at diametrically opposite readings. Any ideas what’s going on here?
“Any ideas what’s going on here?”
Debt Service Ratio = is related to How-Much-A-Month-type payments.
Household debt = How much is owed.
If you lower the interest rates and introduce some interest-only loans then you can decrease the debt service ratiowhile at the same time you can increase the household debt.
If you can condition the vast population of unwashed masses to think in terms of how-much-a-month rather that how much is owed then you are in an excellent position to jack them around as you so desire.
Let them finance cake!
We have how-much-a-month club friends. Lovely people, but they don’t get our way of thinking. Only in an emergency (medical or dental) would we make payments. They realized all the toys they bought, are better rented (motorhome, boat, water craft toys, etc…) I’ll skip the “status”, thank you very much. The stuff sits on their property depreciating.
So far the grasshoppers are laughing at the ants. We’ll see how soon winter comes.
The entire rigged system is set up to favor the grasshoppers and punish the ants.
The rough peak of FOR (financial obligation ratio) was in 2007. This was also at a time when total debt was at the all-time peak (we are still slightly below peak currently).
If we haven’t lowered the amount of debt appreciably from 2007, what could reduce the FOR? I think that is your question.
Answer: Higher incomes (nominally), or lower payments.
1. Higher incomes RELATIVE to the debt. Real wages have been flat since 2007. HOWEVER, on a nominal basis, incomes have risen. Not as fast as people want, but as I understand it, at least with inflation. Incomes rising with inflation, even if the debt amount remains constant explains part of the reduction in FOR.
2. Lower interest rates. Thanks to the Fed Funds rate being 0% for almost what, 6 full years, people have been able to lock in lower and lower fixed rate loans for their mortgages. 30-year rates that were in the 6%-7% range have been 4%-5% now for a LONG time…and with no prepayment penalties for homeowners, they have refinanced a lot, reducing their monthly cost.
I like examples.
Let’s say I overleveraged myself in 2007. I borrowed $250k at 7% and I only made $50k.
My mortgage is at 40% of my gross pay…OUCH.
But I kept my job, and over the next 8 years, I got cost of living increases in my pay. And so now I’m making $57,000 per year.
Without refinancing, my mortgage is still 35% of my gross income…OUCH.
But I refinanced into a new 30-year loan at 4%…and pulled money out because I needed to buy a car (or whatever), so my mortgage is still at $250,000.
Now my payment is 25% of my gross income.
Just from cost of living adjustments in pay, and refinancing to a lower rate, in this example, the ratio of mortgage payment to income went from 40% to 25%.
Even though the loan amount was the same.
And your losses grew and extended multiple years.
Have you turned used car salesman Rental_Fraud?
If you were overleveraged in 2007, how were you able to refinance, presumably post-2008? The property declined in value (ergo you’re MORE overleveraged) and your income barely changed?
I suppose if you held on until 2013/2014, you might have been able to refinance… But IMO that’s a big IF.
You are missing the point.
From wage increases at the level of inflation and lowering of rates, a borrower’s debt service had the potential to go way down, even if the principal amount was constant.
Kicking the can . . . and it’s all about the monthly nut.
Every good salesperson knows that!
Frrrrrraud.
Ah, interesting, good points, thanks all.
Almost finished reading “ISIS Exposed” by Erick Stakelbeck, this book is like a primer of emotional manipulation for intellectual lightweights like Clubber Lang, everything he parrots here could have been lifted straight from the book.
That said, the book extensively discusses ISIS’ mastery of social media (Twitter, YouTube, etc), their overlap with hip hop culture, and obsession with violence. One key takeaway from the book is that Western Europe is f****d.
Stakelbeck overflows with slobbering pro-Israel rhetoric, and repeatedly advocates for American military involvement (boots on the ground) in the Middle East, but he never once mentions who pays for it.
Informative, but alarmist, this is exactly the kind of book that William Kristol wants the demographic “base” of Fear Voters™ to read.
Will an Inquisition return to southern Europe? Watch for Christian revival movements throughout Europe to be the canary in the coal mine.
There might be a nationalist upsurge in Europe, but I wouldn’t bank on a Christian revival. Young people are too jaded and the mainline churchs there, like ours, have stagnated into irrelevance.
It hit me last night as I was reviewing yesterday’s bits over a beer. What if this is 2004/5 and things are about to hit overdrive again? What if there are 2-3 more years of 20%+ price increases? Holy moly.
If that happens, I will most assuredly be Efil4Zatner
It could be worse, you could be in Denver…
If prices increase the next three like the last three, Yellen will be hailed as the new Maestrix! A Genius. Best Fed Chair ever.
There is no tomorrow.
That might have something to do with the fact that housing demand is at 20 year lows and falling.
Why buy a depreciating asset at 3x construction cost when you can rent it for half the price?
Well, I’ll give you a reason. Many of the wealthy foreigners that move into my neighborhood want to BUY. That is their American Dream. And they don’t trust banks. The feel safer having their assets in the land. No joke.
They want to pay grossly inflated prices for a depreciating asset?
Nonsense.
Worse yet, housing demand is falling across the country.
They are doing it every day, all around me. Check the county register to see what their last names are. You can do it - google “King County Parcel Viewer 2.0″ and go to town!
And they’re doing it 10% less this year.
Your point?
If it does, people will look back on Janet Yellen as the worst Fed chief in history, even worse than Alan Greenspan. And someone who keeps rates low because she’s too chicken too offend the markets will deserve that reputation.
“offend the markets” = destroy prices.
Destroy prices and you destroy “values” (choke).
Destroy values and you destroy wealth.
It sure is great we have folks trying to set prices for everyone. I sure think there a big gap between price and value here.
why should I over pay?
Maybe the Fed has been granted “a space to destroy.”
Zero interest rates
Printing money to be thrown out of helicopters
Insane amounts of government debt that can never be paid back
Promising the FSA more than could be ever collected in taxes
Having banks too big to fail or jail.
It is amazing in history of the world no other country has tried this to create prosperity. It was just “so easy.”
Hard work?
Sacrifice?
Savings?
That is for LOOSERS.
And for people who don’t vote the right way.
+1. The financial reckoning day, when it finally arrives after being deferred artificially for so long, is going to be epic.
Of course, there’s nothing to worry about. We’ll all be dead before that happens.
Of course, there’s nothing to worry about. We’ll all be dead before that happens.
“How did you go bankrupt?”
Two ways. Gradually, then suddenly.”
Ernest Hemingway
The Sun Also Rises
Please ignore the fact that I get rich while making the rest of you equally poor and dependent…
———————–
Elizabeth Warren Bought Foreclosed Homes to Make a Quick Profit
National Review | 5/27/15 | Jillian Kay Melchior & Eliana Johnson
The home’s new owner: Elizabeth Warren, today a Massachusetts senator who has built a political career on denouncing the sort of banking titans and financial sophisticates who make a buck off the little guy. Five months after purchasing Veo Vessels’ old home, Warren flipped the property, selling it for $115,000 more than she’d paid, according to Oklahoma County Property Assessor records.
Warren rose to political prominence in the wake of the 2008 financial crisis as a crusader against big banks and a dispenser of common-sense economic advice. She campaigned for the creation of the Consumer Financial Protection Bureau, intended to shield people from the predations of the mortgage and credit-card industries, among others. In her 2006 book All Your Worth, co-authored with her daughter, Amelia, Warren lists as a top myth the idea that “you can make big money buying houses and flipping them quickly.” She has made a career out of telling people how to behave in financially responsible ways, and out of creating laws that will make it illegal for them to do otherwise.
Five months after purchasing Veo Vessels’ old home, Warren flipped the property, selling it for $115,000 more than she’d paid.
But Warren bought and sold at least five properties for profit at a different time in her life, before the cratering economy and a political career made her a star. Her life story has been the subject of much interest, and her 2014 memoir, A Fighting Chance, chronicled her rise from humble beginnings in small-town Oklahoma and her struggle to make ends meet. It didn’t much mention, though, the early 1990s, years when her children were teenagers and she was once again happily married. These are years when she wasn’t yet the multimillionaire she is today, and, she has said, she was voting Republican.
Warren bought two homes after they’d fallen into foreclosure. And though she spent money fixing up the Hickman home before selling it, records suggest she sold others at a significant profit without making any meaningful upgrades.
In 1993, Warren bought a foreclosed property on N.W. 14th Street in Oklahoma City for $4,000. National Review attempted to contact the couple who had owned it. No phone number or email could be found on record for them, and they did not respond to a letter mailed to their last known address, in Colorado. No public records could be found elaborating on the events that led to the foreclosure of their home.
Warren bought two homes after they’d fallen into foreclosure. Records suggest she sold them at a significant profit without making any meaningful upgrades.
In 2004, Warren transferred the home to her brother, John Herring, and his wife, who sold it for $30,000 in 2006, a 650 percent increase over what Warren initially paid for it. Neither Warren nor her brother filed any permits to make improvements.
In June 1993, Warren bought another foreclosed property in Oklahoma City, this one on West Wilshire Boulevard, for $61,000 from the U.S. Department of Housing and Urban Development. Because properties purchased from HUD are sold as is, and because foreclosed homes can have damage ranging from simple poor upkeep to stripped copper, “the only reason you do that is for profit,” says Steve Stout, residential field supervisor at the Oklahoma County Assessor’s Office.
A year after buying the foreclosed property on West Wilshire Boulevard, Warren also bought the house next door for $72,000. Despite filing no building permits to renovate at either property, Warren pocketed $34,000 in profits when she sold the first house in December 1994, and she and her husband, Bruce Mann, made an additional $32,000 when they sold the one next door in 1998.
The profits from these flipped homes adds up: Even excluding the property sold by her brother, Warren and her husband have made at least $240,500 flipping homes (before deducting the unknown sum they invested in remodeling). In her 2014 autobiography, Warren wrote of the events that precipitated the financial crisis that “everyone seemed to have a story about someone they knew who was getting rich by flipping houses.”
Watch what Fauxahontus does, not what she says.
Just because she seized an opportunity to make money, doesn’t mean she is bad. You would have done the same, if you knew a “good deal”. She is being a good capitalist and making non-working assets functional again. I guess we should also fault her for taking a government paycheck and all those government benefits.
‘You would have done the same, if you knew a “good deal”. She is being a good capitalist and making non-working assets functional again’
When I realized the mania was at work, I bowed out. IMO it’s immoral to participate in driving house prices up. Play with stocks, beanie babies, I don’t care. But houses are a basic need.
“houses are a basic need.”
Maybe there should be some kind of restrictions that only end-consumers can buy houses, and that only end-consumers can fix up houses (gov loans for fix-up), that there should be MID for only primary residence, mortgages should be ALL FHA with no private banking involved, and other measures that make sure that homes are dwellings and not investment instruments. That would have kept house prices at PITI 28% gross income,* but it would require massive government intervention.
Are you content with simply staying out of this speculation yourself? Or would you promote regulations which make sure that nobody can speculate? Not judging either way, just wondering.
—————–
*I like principle+interest as a better indicator than price alone because it allows interest rates to move.
‘would you promote regulations which make sure that nobody can speculate’
There will always be foreclosures and distressed property. Often times these properties will not qualify for a loan and someone with cash or unconventional financing has to make it habitable, either for rent or resale. (BTW, I’ve fixed up several houses for lenders directly, so this arrangement can be gotten around in reality).
I used to tell the UHS, send me the listing where the asset manager has cut prices for months and still hasn’t sold it. And when it was in a range I was interested in, low-ball. This drives prices down, not up. When it swung around to people bidding stuff up, I’m out. I probably could have resold right away, but when the rents are sufficient, why sell and chase another deal?
I had a post once quoting, ‘if there is flipping going on, it’s a bubble.’ That is pretty close to the truth. There shouldn’t be big profits in flipping. Especially if people are out-bidding each other. In this bubble, it doesn’t even have to be distressed. Or it could be flipping pre-construction. It’s the market prices running away from normality. This has been facilitated by government loans, central bank mullah, accounting rules changes, you name it. We already have regulators that are supposed to be on the watch for stuff. But instead of doing their job, they are throwing fuel on the fire.
Remember back when the sky was falling and fingers were pointing? Obviously someone had screwed up. Slowly but surely, a little story was created. It was the loans, not the prices that were the problem. FB’s weren’t greedy, they were tricked. And then, high house prices will save the economy.
“‘if there is flipping going on, it’s a bubble.’”
If flipping equals buying and selling a home without doing anything physically to the asset, then I agree 100%. In a “normal market”, transaction costs would make doing this a stupid proposition.
However, if what you are doing is buying a run-down piece of sh*t, and doing all the work necessary to make it livable again, and then re-selling and making a profit, I wouldn’t call that flipping, or see it as a sign of a bubble. That should be an activity that generates a profit even in a weak market.
“I bowed out.”
For some reason, I was under the impression that you had purchased some properties along the way at a low price point.
The companies I manage did buy a few. But it didn’t take long before things got crazy again.
That woman is a bonafide fraud.
ALL politicians are liars and frauds. They have to be. No one can get elected telling the truth. The truth is against the interests of too many special interest groups.
They all want to hand out free shit for votes and power. That is the only game. Why play? Do something else that actually benefits you and yours, like going for a walk.
Weird thinking going on here. You can be a champion of the middle class and be upper class at the same time. See Gates, Carnegie…
So whats the story here? This was in OKC in the early 90s, and the properties look like they were held for a few years before they were sold. Doesnt sound like “flipping” to me.
I really don’t get this idea that you have to give up your worldly possesions/money, before you can critique the “free market/capitalist” system.
If the -fixr ever ran for public office, I can just see the stories now…….
“-fixr buys back totalled car in 1982 from insurance company, fixes it and sells it for $1000 profit. Therefore, any negative comments he has about our current kleptocracy makes him a hypocrite”
I think you would have had to make $100,000 in order to become Dr. Evil-x-fixr. The $1000 you made was probably an accident.
I don’t see a story either.
Did she have insider information?
Did she not bid openly for the properties?
Is there any suggestion that they were sold for more than they were worth? What did other properties sell for in the area?
You don’t have to get a building permit to make a house look a lot better. The houses weren’t flipped immediately they were held for quite a while.
I agree - this doesn’t sound like flipping at all, at least not the kind of flipping we see today. She sold some houses for a profit, maybe by fixing them up first. It’s hard to tell when the article is obviously a political hatchet job.
“-fixr buys back totalled car in 1982 from insurance company, fixes it and sells it for $1000 profit. Therefore, any negative comments he has about our current kleptocracy makes him a hypocrite”
Nice :-).
I don’t understand the problem with Elizabeth Warren - is her anti-bank rhetoric hurting conservative feelings?
She’s got a double whammy: The GOP trolls hate her for being a champion of the Dems, and the Wall Street trolls hate her for trying to regulate their loan sharking.
And she puzzled many by resisting a Fed audit.
That too. (A triple whammy!)
She’s no revolutionary. She’s more of an old-school northeastern liberal democrat, a la Ted Kennedy, who she is essentially replacing as liberal mouthpiece and lightning rod.
Has she broken the law? I notice that some people are really desperate to make her look bad. While there are a few things she’s done that raise questions so far I haven’t heard anything unusual for the political class…yet somebody wants her taken down badly.
2B posted an article from National Review - that pretty much explains it all. He’s on a mission to bring down any non-republican who might win the nomination.
From yesterday:
————
Comment by In Colorado
2015-05-26 11:20:44
I suspect flyover will also be sacked and plundered [in the global collapse]. The uber rich will hire their own private armies to guard their enclaves, and if it gets really bad they’ll hop onto their Gulfstreams and fly to their safe houses in New Zealand.
————–
If by “sack and plunder” you mean buy up, yes I agree. Flyover has water and Wal-Marts and therefore the potential to look like stereotypical medieval Europe with castles on huuuge tracts o’ land and sharecropping serfs giving 10% of the harvest and the biggest hog to the lord.
I’m still surprised that the Chinese haven’t caught on to this. They seem to be more interested in preserving wealth in fewer and bigger chunks by buying crapshacks in Vancouver or San Fran or f-ing floating boxes of air in Miami. Why aren’t they buying entire Oil City towns? The risk is not much different. Water, land, sunlight, soil, good state schools for the kiddies.
And yes, those houses in Toronto and Vancouver are crapshacks, and HGTV can’t hide it. Tens of thousands of dollars of foundation repairs, asbestos removal, and the “mix of traditional and contemporary furnishings” (I’m looking at you Property Brothers) can’t hide that the houses are old and tiny and packed onto tiny snow-stuffed city lots.
” Why aren’t they buying entire Oil City towns? ”
If I were them, I’d be buying large ranches and farms, not dead industrial towns or downtown condos.
They won’t “buy up” a damn thing. They will figure out a way to extract the wealth, have someone else “own” it, then lobby the government to clean up any messes left over.
Welcome to Crony Capitalistan
I’m still surprised that the Chinese haven’t caught on to this.
If they have any thought of living there I assume they prefer the coastal climate, a direct flight back home if political conditions allow it, and the presence of plenty of other Chinese speakers already there to make it feel homey.
Print more dollars, growing government even bigger and adding more debt should help this…
——————–
Dallas Fed: Texas manufacturers slumped to Great Recession-level output in May
Fuel Fix | May 26, 2015 | Collin Eaton
The Dallas Fed says factories churning out equipment and products in Texas slowed their output this month to levels unseen since 2009 when the nation was still mired in a recession.
Texas manufacturing activity in May edged lower for the third month in a row as the effects of the oil slump continued to ripple through the state. About 28 percent of the state’s manufacturers reported a slowdown, according to the Federal Reserve Bank of Dallas’ monthly survey on Tuesday.
“We are seeing all industries hold cash,” a fabricated metal manufacturing executive said in the survey. Others said refineries are spending less money on machinery and demand from the state’s oil producers only got worse this month.
why is the central bank allowed to control the stock market? Seems like a pretty big advantage over the rest of the folks.
They actually don’t have anything to do with the stock market. Their dual mandate is limited to controlling general inflation and maintaining high employment.
“Their dual mandate is limited to controlling general inflation and maintaining high employment.”
That’s close, but not quite. Wiki says:
“Maximum employment, stable prices, and moderate long-term interest rates.[10] The first two objectives are sometimes referred to as the Federal Reserve’s dual mandate.”
On second thought, that’s pretty much what you said.
“controlling general inflation and maintaining high employment”
And ‘maintaining high employment’ opens the door to just about everything.
“Be careful what you wish for.”
Lord help you if you own a house in Charm City…
———————-
Baltimore Residents: We Don’t Think the Police Are Actively Doing Their Jobs
Brietbart | May 26, 2015 | Ian Hanchett
Two Baltimore residents stated that they believed the police in the city are not doing their jobs in interviews broadcast on Tuesday’s “The Lead” on CNN.
Does it seem like their murder rate spiked after the intifada? It almost seems like the police are reluctant to do their jobs out of fear of becoming the next political victims of the War on Police Officers.
Been there, done that, in Cincinnati after the 2000 race riots (that CNN only referred to as “demonstrations”)
Is it “scared of doing their job” or “letting things go to hell, just to show those people who dare question how we do our jobs”
I’m going with “B”
B, for sure. Teach the whiners a lesson.
remember, you are free top move about the country. Very few riots, in Salmon, ID since the Indians controlled the area.
B.
If you like your Democrat-maladministered urban dystopia, you can keep your Democrat-maladministered urban dystopia.
http://www.usatoday.com/story/news/2015/05/26/baltimore-homicides-memorial-weekend/27963899/
It’s going to be a long, hot summer for Baltimore and other Democrat-maladministered urban dystopias.
https://www.youtube.com/watch?v=st4IHokD4Jc
Maybe Baltimore should start some kind of government operated van share program to improve public relations. I’m sure Baltimore’s urban population would love to be shuttled around in a van operated by the Baltimore police department.
She wanted give them some room…
Wonder how the house flippers are doing in Baltimore?
—————–
Mayor Responds To Deadliest Month In Baltimore In 16 Years
WJZ-TV | May 26, 2015 | Mike Hellgren
Bloodshed in Baltimore’s streets. The month of May is the deadliest in the city in more than a decade and it’s not over yet.
The number of non-fatal shootings citywide has almost doubled year-to-date. Last weekend was particularly bloody, with 30 people shot–8 of them killed, making this month Baltimore’s deadliest in 16 years.
The number of arrests is way down this may compared to last, yet police brass contend they’re not backing off.
“It’s absolutely egregious that we’ve passed the 100 mark for homicides in the City of Baltimore,” said Jamal Bryant.
The number of homicides is 35 so far this month. That beat the previous record in December 1999.
There have been 108 homicides so far this year as compared to 75 last year around this time.
Baltimore police also report a total of 205 non-fatal shootings so far this year, compared to 115 last year.
Welcome to the jungle. Wonder what pretext will be used to schedule the next Purge Night?
Remember when Bill Clinton said “Midnight Basketball” would reduce black on black crime back in the 1990s, LOLZ
The bell ringing at the top?
—————-
$500 Million LA Home - Built on Spec
Mish - 5/26/2015
To highlight the enormous and growing income inequality issue, please consider California Dreaming: Record $500 Million Tag on L.A. Home.
Nile Niami, a film producer and speculative residential developer, is pouring concrete in L.A.’s Bel Air neighborhood for a compound with a 74,000-square-foot (6,900-square-meter) main residence and three smaller homes, according to city records. The project, which will take at least 20 more months to complete, will exceed 100,000 square feet, including a 5,000-square-foot master bedroom, a 30-car garage and a “Monaco-style casino,” Niami said.
Questions of the Day
What is the estimated profit on this monstrosity?
What are the construction carrying costs if this thing goes unsold?
What about insurance?
Who wants to lay $500 million to live in LA?
How many people in the world can afford a half-billion dollar home?
Does anyone who can afford such a home, want one?
Somebody will exercise some options and buy it. People who have real jobs are not in the running.
Just for reference, this house is half of a Target.
“The average size of a CityTarget is about 80,000 square feet to 100,000 square feet, Schindele said, compared with Targets that average 135,000 square feet and Super Targets that are about 175,000 square feet.”
http://www.huffingtonpost.com/2012/07/18/target-citytarget-stores_n_1684484.html
Is there even a plot of land that big, or 1/2 or 1/3, in LA?
“Apparently it doesn’t have to be a penthouse anymore to shatter a price record in Boston.”
“It’s a new high watermark. The world is awash in cash.”
http://www.boston.com/real-estate/luxury-living/2015/05/26/mandarin-oriental-condo-sets-new-record-for-highest-price-per-square-foot/upI2IPrZ4GV84SY25mCakI/story.html#sthash.FqpM1Juq.dpbs
Almost out of OPM…
Panic time is close at hand.
More debt is always the best answer.
What’s in your wallet?
——————–
With Greece “Nowhere Close” To Deal, Depositors Pull €300 Million From Banks In Single Day
ZeroHedge - 05/27/2015
On Tuesday, Greece postponed a scheduled Eurogroup meeting in Brussels without offering a reason as officials conducted “preparatory” discussions and held an evening teleconference with creditors. Face-to-face meetings will take place today with just 9 days to go until June 5 when Athens will miss a payment to the IMF, triggering an unprecedented default the repercussions of which no one can accurately predict.
Also on Tuesday, Greek FinMin Yanis Varoufakis allegedly told Greek reporters that one measure under consideration to help stem the outflow of deposits from Greek banks was a levy on ATM withdrawals designed to encourage the use of credit cards over cash, a rather ironic suggestion coming from a government crippled by debt. The Finance Ministry was quick to deny that such a levy was being considered because after all, one way to ensure that ATM lines will get quite a bit longer is to suggest that depositors will soon be subject to a levy on withdrawals. Unfortunately, it appears as though the move to dispel the ATM tax “rumor” came too late because according to Kathimerini, deposit flight accelerated meaningfully on Tuesday. Here’s more:
Credit sector professionals reported that deposit outflows on Tuesday alone came to 300 million euros, against about 100 million euros per day in recent days. They said that while this amount is quite high, the situation is under control as citizens are remaining calm on the positive messages from Greek officials.
Denial giving way to panic once again? (Yawn…)
“Credit sector professionals reported that deposit outflows on Tuesday alone came to 300 million euros, against about 100 million euros per day in recent days.”
But not to worry because …
“They said that while this amount is quite high, the situation is under control as citizens are remaining calm on the positive messages from Greek officials.”
Got it.
bloomibergi:
The Mansions That Are Swallowing Suburban Homes
http://www.bloomberg.com/news/articles/2015-05-27/aging-homes-replaced-by-mansions-as-u-s-suburbs-remade
…Builders, lured to locations where land is more valuable than the aging housing stock, are transforming communities outside of major employment hubs to take advantage of demand for real estate where schools are decent and commutes are short.
“…It’s all about traffic jams — people can have nice houses far out in outer suburbs but the commute time is impossible,” says Lawrence Yun…
…well-located vacant lots are becoming difficult to find…
——————
Pimmit Hills is a prime target for tear-down because those little ranches in Pimmit Hills are built on quarter-acre lots, AND it’s close to highly paying cubicle jobs. You could live there and commute 15 minutes on city streets without touching the Beltway or the Metro or I-66.
Mansions generate largrr mortgage interest deductions and capital gains.
Not to mention higher property taxes. Gotta pay for those good schools somehow!
It makes for good headlines Donk but it’s just more fluff and not much truth.
“We like it when we see more new houses,” said Quy Phung, Yim’s husband. “It brings up the property values.”
Everyone’s a capitalist regardless of origin.
More inventory brings up prices? LOL
Someone said the chinese aren’t too bright.
Don’t be a dipwad. She meant that more new multimillion-dollar houses will raise the value of the quarter-acre that her little ranch house sits on, for the tear-down value alone. And you know it.
We know what she said Donk. If that’s what she’s thinking, she’s as empty pocketed and deluded as you are.
It’s the materials! Nope you paid too much.
It’s labor cost. Nope you paid too much.
It’s the land! Nope you paid too much.
You’re screwed.
Meanwhile, in Greece, the stealth bank run is accelerating as depositors wisely to not trust a socialist government not to pull a bail-in.
http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_27/05/2015_550408
The vast army of D.C government workers and contractors needs better places to live.
It is only fair. I mean - who uses a carport? It is cruel and inhuman!
And it is for the children.
—————–
The Mansions That Are Swallowing Suburban Homes
Bloomberg - May 27, 2015
Merion Homes bought two dozen rambler-style houses in Northern Virginia’s Pimmit Hills community for about $450,000 each, just to knock them down. Now it’s selling customized residences three times larger at prices topping $1 million.
“The original homes don’t fit today’s market,” said Ryan Bensten, 35, a principal of Merion Homes, which he started with his father, Bill. “They don’t have enough bedrooms — they’re too small.”
More builders are ripping down existing homes because well-located vacant lots are becoming difficult to find and structures in communities close to urban areas are among the oldest. In 2013, about 47 percent of owner-occupied homes in the U.S. were at least 40 years old, up from 27 percent in 1991, according to an analysis of Census Bureau data by the homebuilder group.
Last year, 455 single-family homes were demolished in Northern Virginia’s Fairfax County, the most in data going back to 2006, according to county records. Almost half were in Pimmit Hills and surrounding neighborhoods, and in nearby McLean.
In quiet neighborhoods surrounding Langley High, ranked the second-best public school in Virginia, Margenau can spot the next targets. He pointed to a one-story brick rancher surrounded by newer homes that were triple the size.
“That one will go,” he said on an overcast Tuesday afternoon last month. “It has a carport — not even a garage.”
The older homes in the community are “functionally obsolete” — the kitchens are enclosed, the ceilings are low, closets and windows are too small, Margenau said.
Ning Yim, an accountant who lives in Pimmit Hills, said new construction is changing the dynamics of the neighborhood, established in the early 1950s for returning veterans of World War II.
“It was blue-collar, but more middle-class people are moving in,” she said in the driveway in front of her home, one of the older-style properties with an addition in the back.
The bigger homes don’t bother her or her family.
“We like it when we see more new houses,” said Quy Phung, Yim’s husband. “It brings up the property values.”
Contractors yes, government workers no. Even a household of two maxed-out GS-15’s couldn’t afford these million-dollar McMansions. There are few GS-15’s and they are getting fewer.
And it’s an arrogant article. There are no “needs of the modern homeowner.” They are entirely wants.
And older, weather people actually will end up wanting ramblers since they can’t deal with stairs at some point. A lot of builders seem to be overlooking this. Shoot, some of these narrow three-story jobs near me really need to come with an elevator (garage on first floor, kitchen on second, bedrooms up top).
Yep, we bought an L shaped Santa Barbara Rancher for a few reasons:
1. practicality of a single level.
2. it will have good resale value-
Developers went mostly 2 story
1970ish in So Ca, as land values went up
3. cheaper interior climate control
I would never buy into a 55+ community. I like the kids on bikes. So cute. Halloween and Christmas, etc…
Heck *I* bought a single-level ranch too and I’m still young.
But I’m not doing Halloween again. Last year I got 4-5 polite kids in costumes… and about 20 teenagers/migrants who didn’t bother with costumes or even the formal phrasing. They just shoved plastic grocery bags at me. One group of 5 silently stared at me, their backpacks slung in the front with the zipper of the main compartment wide open, creating a maw obviously meant to receive their rightful share (i.e., all) of my leftover sugar bombs. Talk about FSA.
F ‘em. If I want to be entertained by the FSA, I’ll go watch the EBT recharge stampede at the 24-hour Wal-Mart.
(hmmm, Halloween IS on the last day of the month….)
Once again, the sheeple are obediently bending over for the .1% by supporting it’s water carriers, rather than voting for genuinehope and change.
http://www.businessinsider.com/rand-paul-is-officially-fading-2015-5
Sectarian wars are maybe the kind we want to stay out of.
http://www.defensenews.com/story/defense/international/mideast-africa/2015/05/26/us-shiite-name-iraqi-operation-helpful/27970559/
Israel is not America’s 51st state
obama said there were 57 states…
There is nothing “smaller government” or “lower taxes” about America’s support of a fascist apartheid state.
Are you talking Saudi Arabia, Iraq or Iran?
Israel is demanding $45 billion in US “aid” to confront the threat of Iran. I have zero doubt that his neo-con unregistered agents of a foreign power will ensure he gets every cent.
http://rt.com/news/262505-israel-military-aid-us/
“The US is currently legally committed to maintaining Qualitative Military Edge, a doctrine that ensures Israel’s superiority over its neighbors, purportedly in the name of maintaining stability in the volatile region.”
Cite: “legally committed” WTF?
The financial reckoning day for the shale industry slouches closer.
http://www.businessinsider.com/chanos-theres-a-disaster-waiting-to-happen-in-the-oil-and-gas-industry-2015-5
Will Greece be the catalyst the spells an ignoble end for radical Keynesian economics and central banking?
http://davidstockmanscontracorner.com/praying-for-graccident-would-trigger-demise-of-the-ecb-and-the-toxic-regime-of-keynesian-central-banking/
It may also require an intellectual revolution within the economics profession. Is anyone at Chicago up to storming the Bastille?
It might be the end of the euro, a multinational currency, but there’s no reason that it should have any effect on national institutions.
Au Contraire!
Greece is just the first domino in the EC that will fall.
Look at the Debt-to-GDP numbers for all of the Northern European countries that the progressives like to tout as models for how to do things. They will be next.
That’s why Greece is so important. It’s the sickest canary right now.
Look at the Debt-to-GDP numbers for all of the Northern European countries that the progressives like to tout as models for how to do things
They’re probably much lower than the Japanese ratio. Japan is one the most prosperous countries, along with those Northern European countries.
So soccer officials can be arrested for criminal racketeering, but not banksters. Got it.
http://www.independent.co.uk/news/world/europe/fifa-corruption-arrests-live-blog-football-officials-arrested-in-investigation–live-updates-10277649.html
Bernie Sanders: a classic case of right description of the problem, wrong prescription for a solution. But I love the fact he’s calling out the .1%, and implicitly, Hillary, on its rip-offs of the middle and working classes.
http://america.aljazeera.com/articles/2015/5/26/bernie-sanders-officially-launches-democratic-presidential-campaign.html
Ask Venezuelans How Bernie Sanders-Style Socialism Is Working Out for Them
National Review | 05/27/2015 | by Michelle Malkin
Socialist genius Bernie Sanders has figured out what’s really ailing America.
Nobody parodies the far Left better than far-leftists themselves.
In an interview with financial journalist John Harwood on Tuesday, Sanders detailed his grievances with an overabundance of antiperspirants and footwear. “You don’t necessarily need a choice of 23 underarm spray deodorants or of 18 different pairs of sneakers when children are hungry in this country. I don’t think the media appreciates the kind of stress that ordinary Americans are working on.”
Try to suppress a snicker: Sanders, Decider of Your Sanitary and Footwear Needs, is casting himself as the Everyman in touch with “ordinary Americans” to contrast his campaign with Hillary “my Beltway lobbyist and foreign-agent operator Sid Blumenthal is just a friend I talk to for advice” Clinton.
In Sanders’s bubble, childhood hunger is the fault of selfish consumers, self-serving entrepreneurs, and rapacious retailers who engage in voluntary transactions in a free-market economy. Just as Sanders believes there are “too many” products on the shelves, President Obama recently opined that families of America’s top earners in the financial industry “pretty much have more than you’ll ever be able to use and your family will ever be able to use.”
In Venezuela, the shelves are unburdened by “too many” deodorants and shoes and too much soap, milk, or coffee. Food distribution is under military control. The currency of the socialist paradise just collapsed on the black market by 30 percent.
Take it from those who suffer most under the unbridled fulfillment of “you didn’t build that” and “you don’t need that” radicalism: It stinks.
Over the past 30 years, the “market” (whoever that is) has thru various mechanisms, cut my pay by 50%. Then, lobby the government for fixes, whenever a true “supply” problem starts trying to come home to roost.
What is easier, when the subject of a raise comes up, the guy holding all of the cash just saying “no”, or the serf having to make the decision to pack up and move 1500 miles to find a better paying job?
This is why people cant make any money. The risks and costs of relocating vs. the costs of just spreading the cheeks and taking a pay cut …..year after year
The thing that makes me LMAO is that cutting the pay/benefits of the wretched refuse has been Job 1 of the “producers” plan for 30 years, but then they are mystified when the WR doesn’t have any money to spend.
+1
You actually posted an article written by Michelle Malkin? You must really be getting desparate.
She cites no evidence that Sanders seeks to emulate Venezuela. In fact, she doesn’t mention any of his positions in this rant. A different headline for this article could be, “Michelle Malkin doesn’t object to any of Bernie Sanders’ proposals”.
The right must be afraid of Bernie. Hillary, if elected, would just be a nuisance. Bernie wants to flip the apple cart. Wall St and the Banking Clan will have none of that.
‘Bernie wants to flip the apple cart.’
Like GeeZeus in the temple with the money changers…sort of.
The inflation rate in Venezuela just hit 500% by some calculations. Looks like the population is losing faith in the country’s money and socialist “leadership.”
http://www.businessinsider.com/venezuelas-inflation-rate-is-over-the-top-2015-5
Sanders has my donation. I want to see him in the debates, my guess is they’ll figure a way to exclude him. The top 0.1% are getting wealthier due to government policy that redistributes wealth from the middle class to the elite. His prescription is to end that.
You probably support his stance on trade, and foreign wars, market manipulation, price fixing, tax policy for hedge fund managers, etc.
Not to worry if he looks like he is going to gain traction he will likely suffer a stroke or die in a plane crash.
From a policy point of view I prefer Sanders over Warren. I hope he doesn’t run as an indie in the general or he might split the Dem vote and throw the election to the Repubs, a la Ralph Nader in 2000.
. Hilary and Jeb are two heads on the same monster
Does it seem like Mr Market is developing a case of heartburn over all this Fed chatter about the timing of rate hikes?
Stocks listen to the Fed, but obey the bond market
Yahoo Finance By Michael Santoli 1 hour ago
There’s really not much to worry about. When the big expected thing happens, whenever that is, it will be fully expected, and we should all be able to handle it without much trouble.
That’s been the message from a couple of richly credentialed central bankers in the past day or so, as they try to reassure investors that by the time the Federal Reserve starts snugging up interest rates, the move will be well telegraphed and will occur for the right reasons.
Fed Vice Chair Stanley Fischer gently chided investors for placing too much emphasis on the first rate boost, whenever it comes, because it will be merely the first tiny step on a long trip back to normal for monetary policy.
Ben Bernanke overnight sounded a similar note to audience in South Korea, saying that the first hike will be good news because it means the U.S. economy is doing better, and he added that he sees no real extremes in real estate or financial market behavior at the moment.
These gray eminences have the forces of logic and planning on their side. But it’s never possible to figure out exactly what set of calculations, expectations, hopes and delusions is priced into markets at any given moment. So this makes it hard to say with confidence that markets can absorb whatever policy shift occurs and trudge on undisturbed.
Tuesday’s downward wiggle in stocks suggests that investors still might have a bit of adjusting to do as they get prepared for a Fed looking to “normalize” in an economy not yet in obvious re-acceleration mode.
…
Volvo says horrible “self-parking car accident” happened because car didn’t have “pedestrian detection” option
By Mark Frauenfelder at 10:24 am Tue, May 26, 2015
boingboing.net/2015/05/26/volvo-says-horrible-self-par.html - 37k - Cached - Similar pages
Self-parking car accident! Carro que se parquea solo choca dos …
http://www.youtube.com/watch?v=_8nnhUCtcO8 - 342k -
We’ll take the power sunroof, the Pioneer premium 9-speaker system, the heated leather seats front and back with with 3 warmth settings, the 17″ 5-spoke flangeless alloy wheels and we’ll pass on the pedestrian detection system.
This raises an important question:
Who has liability here? Do you sue the car owners because they failed to buy optional safety features? Or do you go after the government to mandate that such features come standard?
This is a huge Pandora’s box that has been opened.
I like my car to be fully under my own control.
I believe it was also a Volvo that smashed into the back of a truck during a press event demonstrating their self-braking feature several years ago.
What we need is thug control.
—————
Seriously: White House Suggests More Gun Control In Strict Baltimore After Bloody Memorial Day
townhall.com | 5/27/2015 | Katie Pavlich
When asked about the violence yesterday, White House Press Secretary Josh Earnest suggested more gun control was one of the solutions.
“Obviously there’s some common sense things we could do – certainly passage of some gun safety laws in Congress that could keep guns out of the hands of criminals would be one thing that we could do to try to limit the violence,” Earnest said.
There’s just a few problems with that suggestion. Maryland already has strict gun control laws. In fact, it was just two short years ago that new gun control measures were passed through despite overwhelming opposition.
Is ‘thug’ a politically correct substitute for the ‘n’ word?
Am I a racist because I like my African African neighbors who were born in Sudan and Nigeria better than my African American neighbors who were born here?
At one point in college, I had room mates of similar descriptions ( Nigeria in one case,south side of Chicago in the other). Intresting study in cultural contrasts!
There are more black people living in my apartment building than in the entire ZIP code of most of the “progressive” posters here
Progressive = diversity for thee, but not for me
I am reminded of a documentary I saw of black Americans who went to visit Africa and who were shocked when the locals told them that they were Americans and not Africans, and should not call themselves “African-American”
Am I a racis
t because I like my African African neighbors who were born in Sudan and Nigeria better than my African American neighbors who were born here? Yes. FIFY.President Barack Obama broke his silence this afternoon on the riots that devoured Baltimore last night and led to more than 200 arrests, shaming looters and saying they should be treated as ‘criminals’ and ‘thugs.’
http://www.dailymail.co.uk/news/article-3059336/Obama-shames-Baltimore-looters-condemns-riots-streets.html#ixzz3bLao8r2m
Like the ‘ n ‘ word, it’s fine for African Americans to use the word ‘thug ‘.
It’s racist for a Caucasian to use it.
…
BLOCK: John, I’ve been looking at the Merriam-Webster definition of thug, and it describes it as a brutal ruffian or assassin. What’s the origin of this word?
MCWHORTER: Well, the word originates in India as a word for roughly that. And because the British ran India for a good long time, the word jumped the rails from Indian languages to English, and that’s the reason that we in America have used the word for a very long time. And until rather recently, it did mean what you might call a ruffian, but of course, things have changed.
BLOCK: Well, how have they changed?
MCWHORTER: Well, the truth is that thug today is a nominally polite way of using the N-word. Many people suspect it, and they are correct. When somebody talks about thugs ruining a place, it is almost impossible today that they are referring to somebody with blond hair. It is a sly way of saying there go those black people ruining things again. And so anybody who wonders whether thug is becoming the new N-word doesn’t need to. It’s most certainly is.
BLOCK: Although, if you think about it, I mean, in two of the pieces of tape that we played, we heard from an African-American mayor of Baltimore and an African-American president of the United States using that word.
MCWHORTER: Yep, and that is because just like the N-word, we have another one of these strangely bifurcated words. Thug in the black community, for about the past 25 to 30 years, has also meant ruffian, but there is a tinge of affection. A thug in black people’s speech is somebody who is a ruffian but in being a ruffian is displaying a healthy sort of countercultural initiative, displaying a kind of resilience in the face of racism etc. Of course nobody puts it that way, but that’s the feeling. And so when black people say it, they don’t mean what white people mean, and that’s why I think Stephanie Rawlings-Blake and Barack Obama saying it means something different from the white housewife wherever who says it.
…
FWIW, the regular commenters on news sites are using “thugs” to describe the biker gang melee in Waco.
“Obviously there’s some common sense things we could do – certainly passage of some gun safety laws in Congress that could keep guns out of the hands of criminals would be one thing that we could do to try to limit the violence,” Earnest said.
You have to ask yourself why oligarchs like Soros and Bloomberg are so hell-bent on disarming the population.
The same reason there is a fence around the obama white house and no fence on the southern border?
Read your own quote again.
keep guns out of the hands of criminals
It’s interesting that this is controversial.
Sure, “keep guns out of the hands of criminals.” The average person unwitting commits crimes every day, given the insane proliferation of criminal offenses and insatiable appetite of the prison-industrial complex for more slave labor. Gun control has always started with “public safety” as its pretext, then proceeded to total confiscation, which allowed the totalitarians to do anything they pleased since the disarmed populace was in no position to resist.
Generally, it’s violent crimes that are the concern, not parking tickets. Maybe you’re aware of that. Your ideas about the history of gun control are repeated a lot on the internet. You’ll be lucky if you can find one example.
In fact, it was just two short years ago that new gun control measures were passed through despite overwhelming opposition.
If you take a look at a map of the region, you can see what the problem is.
CraterRage Photo Of The Day
http://goo.gl/Ckk2Oq
Finally the degenerate gambler!
Royal Flush in diamonds v. 4 of a kind. Much like housing bought at peak bubble prices, you’ll go broke every time.
Is it time for cash hoarders to throw in the towel and go all-in to stocks before a wave of deliberately created inflation cuts the real value of their savings in half?
The Fed is trying to create inflation but they aren’t saying it. They say they will keep ZIRP until “full employment” occurs. But full employment, if it happens, triggers wage and price inflation. Moderate inflation due to full employment is actually very healthy and desirable. I find it odd that the Fed shies away from saying the obvious, that if full employment is your goal then moderate inflation is also your goal. The two are inseparable.
They openly state that 2% inflation is their goal.
That’s misleading or wrong if the Fed says that. Most likely the former. 4% or 5% inflation is the likely result if the economy got into full employment + GDP growth mode.
We all know what your depreciating junk is worth…..
How much do you owe?
http://goo.gl/qx0dRC
HAVE U EVER HEARD OF APPRECIATION?
Houses depreciate Poet. They always have. They always will.
Renton, WA List Prices Dive 6% YoY; Inventory Skyrockets 109%
http://www.movoto.com/renton-wa/market-trends/
I can’t figure out whether this is racist or obesist.
Fashion, plus-size modeling and race: When ‘diversity’ isn’t so diverse
By Lisa Respers France, CNN
Tue May 26, 2015
“Not only are most of the faces featured in the ads for this recent plus-size renaissance white women, but when there are women of color featured in these body positive campaigns, they are usually featured in a sea of white bodies, this even as Black women remain the face of obesity in America,” Ball writes.
http://www.cnn.com/2015/05/26/opinions/tess-holiday-people-plus-size-model/index.html
All the Marxist-feminist shaming in the world can not overcome the fact that desire can not be negotiated.
Someone needs to make up their mind. Screeching about skyrocketing childhood obesity, but then asking for acceptance for older chubbies.
How do you know it’s the same people?
It’s sexist.
The main event is still to come.
Jade Helm 15?
New AG Lynch is showing her priorities by cracking down on fraud in…soccer. Meanwhile, fraud and manipulation in our rigged Ponzi markets continues unchecked, and seven years after the 2008 financial crash not a single bankster has gone to prison.
http://www.nationaljournal.com/domesticpolicy/fifa-indictment-lynch-soccer-world-cup-052715
The flood in Texas story goes well with another story I heard last week…….
Sister sell house in DFW area town, moves to “country” ( “for the kids”, of course). New house has no sewer, only septic tank. This is considered a “feature”, not a “bug” by the boot strapping sister.
Today……..because of heavy rains, septic tank is unusable. Toilet unusable, now using buckets in garage.
Ever see a public sewer system back up into someone’s house?
Imagine a fountain of sh*t coming out of the lowest level toilet.
Septic systems are fine - especially in a rural area.
IF you take care of them and flush nothing except what comes naturally from your body.
And they are much cheaper than public sewers. As long as you take care of them.
In the 50 year floods in Texas right now - sewers wont be working either. In fact - many lines to include storm lines will probably be filled with silt and mud requiring costly repairs.
Yeah, you’ll love your septic system until your own e-coli contaminates your well that’s only 100 feet away. All septic systems raise e-coli by a small amount. All of them. The only reason they “work” is because the increase in e-coli is small enough the well water still meets quality standards.
Why you should also treat your well water…
Lost of inexpensive ways to do it. Filters, sand, UV, chemicals, etc.
One of the joys of owning a house is that you’re responsible for all matters fecal.
When it comes to fecal matter, being true to my left-of-center leanings I prefer the “collectivist” solution (public sewage). I’m quite happy to hit the flush handle and send my donation to the government.
‘I prefer the “collectivist” solution (public sewage)’
When I worked for a central Texas water department (very short time), I had to get a waste-water license. In the classes I took, the guy told us how older water systems lose 80% of their fresh water because the pipes are cracked and the local governments don’t want to piss off the locals by tearing up the streets. They are constantly short of fresh water, fighting over the aquifers, etc. In this town, they have ‘the cleanest river in Texas’ for exactly 1.5 miles, where the effluent from the town sewage plant dumps into it. Below that swim at your own risk and that smell is from the fish die-offs.
There isn’t any perfect method of dealing with sewage. I have seen the “alternative” septic systems in Coconino county. Two tanks, pumps. It’s all they’ll approve now if city sewer isn’t available.
Years ago I rented a cabin on a lake. It was the perfect rental except for the 70 mile one way commute to work, and the neighbors who were only 15 feet away on both sides. One of the neighbors told me how the backyard of the cabin, which was on top of a small, steep hill, started leaching septic “material” from the ground one day. When the owner tried to come to some agreement with the other neighbor about fixing the problem, the neighbor didn’t want any part of it. I guess they’re not on speaking terms now, which must make for some uncomfortable silences, especially because the main doors face one another. I don’t know how the problem was fixed, but I’m glad it was someone else’s problem.
I thought I found a rental. LL seems cool. Single family home condos with amenities. Looked good, cheaper than what we’re paying now.
Very happy…until I found the “shame on you” news video about the rats.
“…..take care of them……”
But that’s the problem. With my sister specifially, and boot strappers in general.
She doesn’t know squat, but she thinks she does. Like a lot of people, she has a habit if over-estimating the benefits, and under-estimating/ignoring/not recognizing the costs. Much like just about every Republican I know.
In the meantime, gotta try to fight the traffic jam, generated by all of these Kansas welfare and Food stamp recipients trying to get to their cruise ships
Much like just about every Republican I know.
Yeah - I remember that with obamacare…
How soon we forget those trillion dollar wars…
How soon we forget those trillion dollar wars…
58% of Democratic senators (29 of 50) voted for the resolution. Those voting for the resolution are:
Lincoln (D-AR)
Feinstein (D-CA)
Dodd (D-CT)
Lieberman (D-CT)
Biden (D-DE)
Carper (D-DE)
Nelson (D-FL)
Cleland (D-GA)
Miller (D-GA)
Bayh (D-IN)
Harkin (D-IA)
Breaux (D-LA)
Mary Landrieu (D-LA)
Kerry (D-MA)
Carnahan (D-MO)
Baucus (D-MT)
Nelson (D-NE)
Reid (D-NV)
Torricelli (D-NJ)
Clinton (D-NY)
Schumer (D-NY)
Edwards (D-NC)
Dorgan (D-ND)
Hollings (D-SC)
Daschle (D-SD)
Johnson (D-SD)
Cantwell (D-WA)
Rockefeller (D-WV)
Kohl (D-WI)
http://en.wikipedia.org/wiki/Iraq_Resolution
I don’t think anybody would have believed that Bush and Cheney would be sleazy enough to lie the country into a war. But when it comes to war, never underestimate the sleaziness of a republican.
+1
“Berkeley lab unveils new solar energy center aimed at producing fuel from sunlight”
Top scientists from Caltech and Berkeley working on artificial photosynthesis. Very interesting! It’s a solar panel that uses sunlight, water and CO2 to produce organic compounds like drugs, plastics or fuel. Gasoline produced this way would be carbon-negative. If you burn it the net effect is carbon neutral because you are releasing the CO2 that was harvested by the artificial leaves. Or, a utility solar installation could produce fuel by day and burn it at night.
Using sun to make oil, also see…
http://www.sapphireenergy.com/
Reason #746550 why unions are lying hypocrites…
Unions also wanted obamacare - as long as they were exempt from it.
2banana rule on politics:
Conservatives and more than happy to live under the same laws and pay the same taxes they want for everyone else.
Liberals/progressives expect to exempt from the laws and taxes they want for everyone else.
———————
L.A. labor leaders seek minimum wage exemption for firms with union workers
Los Angeles Times | May 27, 2015 | PETER JAMISON, DAVID ZAHNISER AND EMILY ALPERT REYES
Labor leaders, who were among the strongest supporters of the citywide minimum wage increase approved last week by the Los Angeles City Council, are advocating last-minute changes to the law that could create an exemption for companies with unionized workforces.
The push to include an exception to the mandated wage increase for companies that let their employees collectively bargain was the latest unexpected detour as the city nears approval of its landmark legislation to raise the minimum wage to $15 an hour by 2020.
For much of the past eight months, labor activists have argued against special considerations for business owners, such as restaurateurs, who said they would have trouble complying with the mandated pay increase.
But Rusty Hicks, who heads the county Federation of Labor and helps lead the Raise the Wage coalition, said Tuesday night that companies with workers represented by unions should have leeway to negotiate a wage below that mandated by the law.
Conservatives and more than happy to live under the same laws and pay the same taxes they want for everyone else.
LOL. Repubs are and have been the champions of special interest tax shelters, carve outs, exemptions, and special regulatory treatment of their corporate buddies for years. Blue collar Joe on the factory floor pays 25% tax on his income but Fat Cat CEO pays very little because his “income” comes in different forms that is sheltered from income tax.
Why do you think Mitt Romney stashed his millions in the Caymans. Paying US taxes are for the “little people.”
Now if you say modern Repubs are not conservatives, then I could agree with your assertion.
Quit whining, you serf. We have the best government money can buy.
As for me, back to work. The 16 passenger, intercontinental range bizjet I currently maintain is on the coast this week. The owner’s wife has an appointment with her hair stylist.
Right on my man, got to have those private jet tax exemptions to keep you busy. Gulfstream? Citation?
Large cabin Dassault Falcon. Citation X.
There’s nothing I like to do more when I’m riding my federally subsidized private jet than bitch about how those lazy welfare people are buying lottery tickets with my tax money.
Needless to say, being an Eisenhower Republican/socialist in the corporate aviation business has a tendancy to raise my blood pressure. It takes genuine fortitude to avoid throwing the “this is genuine BS” flag daily, if not hour.
99.5% of the people working in the business are boot licking Republicans, because they know a lot of them will be looking for work if anyone DARES to take away all of the tax deductions/exemptions/giveaways.
The 1%ers fine tuned the art of having someone else pay for their toys with business aircraft. Takes sales tax on maintenance/parts. They don’t pay it. They got one state (run by Republicans) to slip in a law exempting aircraft maintenance from paying sales taxes, to “help out” the local guy in his Cessna 172. Once one state passed it, the rest of them rolled over, because they “had to, in order to not lose jobs”
On a big business jet, a $50k invoice can be run up in a few days, and a $1million invoice doing a “C” check is real easy.
$3k here, $60k there, and pretty soon you are looking at real money that the states aren’t collecting any more. But that’s okay, we’ll just jack the sales tax rate to 9-10% on the wretched refuse who aren’t “producers”
I have a feeling we won’t be hearing about these welfare checks for the 1% at the republican convention.
X-GSfixr: we’ll just jack the sales tax rate to 9-10% on the wretched refuse who aren’t “producers”
These people are the infantry. They’re mechanics, bricklayers, Subway Sandwich Artists, heavy equipment drivers, cattle-stunners, cops, garbagemen, truck drivers, construction workers.
I.e. the people who actually create a majority of the value the rest of society enjoys.
Their wages have been stagnant for decades as more and more value is produced while the heads-I-win-tails-you-lose financial sector extracts ever more value from the economy. With a Congress that can’t craft an economic policy which isn’t a cronyistic scam (from the article: Congress okayed 2 billion in Haiti aid but only 0.7% went to Haiti, the rest to DC contractors :), but which is extremely adept at raising money.
And, no, I’m not kidding.
Among the other little excursion I’m personally aware of:
-Flight from Chicago to Florida with the CEO’s wife’s dog, because she “misses him”
- celebrity who got in a pi##ing contest with parent, who decided to GO HOME, right now! From Europe. Nine hours nonstop over, change crews while refuelling, and fly empty back.
- ever notice how many high level business confabs are held in resort areas with little or no airline service? Defacto vacations, with just enough “business” being conducted to justify the expense writeoffs.
Can’t say that I blame them. As crappy as the airlines are, i’d fly corporate too, if I could afford it, and/or afford the lobbyists it would take to make it all deductible.
I bet there are quite a few republican congressmen who regularly take these flights. Does John Boehner have a plane named after him?
I’ve never seen a Democrat on a corporate jet personally. I’m sure that this has more to do with the fact that 100% of the local politicians are Republicans
Never confuse republicans and conservatives.
Maybe 10% of republicans that are elected at the Federal level are conservative (there used to be a few democrats too).
Most republicans are democrat lite.
The Republican Party is what it is! You cant run from them claiming they are not “real Republicans.” lol!
But he can clearly claim the Republican Party leaders are not real conservatives.
But go ahead and enjoy yourselves…
Democrat vs. Republican
Black vs. White
Gay vs. straight
Pro life vs. women’s right to choose
Gulp Gulp Gulp
That is the strategy
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]
You’re sort of near an interesting issue there, though you may not realize it. These labels, like the word conservative, have become nearly useless and end up serving as a distraction. That’s been particularly true with many words that end in -ist and -ism that have become popular during the past seven years.
“You’re sort of near an interesting issue there, though you may not realize it.”
“but a concerted plan to effect a divide and conquer strategy on the population by the money interests that benefit from having the public pitted against each other.”
Divide and Conquer: Politics and the Left/Right Fraud
by James Corbett
BoilingFrogsPost.com
January 28, 2014
From education to the environment, business to banking, housing to health care, it seems that there is no issue in the world that the industrialized western democracies cannot reduce to a simplistic paradigm of “liberal” vs “conservative.” In fact, this point has been so hardwired into the modern political system that it has been distilled into a childlike shorthand: political positions are “left” or “right,” “blue” or “red.” These convenient, color-coded political choices infantilize the political process, making the public little more than spectators at a sporting event, rooting for one team or another without even having to understand the issues being debated.
Nowhere has this process of simplification become so refined as it has in the United States of America, sometimes laughingly referred to as the “leaders of the free world.”
Whatever the intentions of the original creators of the Federalist and Democratic-Republican Parties, by the 20th Century the American system, supposedly the beacon of democracy for the world, had become hardwired into a two-party duopoly: the Republicans and the Democrats. This was not the result of mere happenstance, but a concerted plan to effect a divide and conquer strategy on the population by the money interests that benefit from having the public pitted against each other.
Late last March I had the chance to talk to independent news commentator Charlie McGrath of Wide Awake News about this strategy of divide and conquer and how it functions to keep like-minded people apart on so many issues.
The situation would almost be laughable if it were not so tragic. Having been immersed in the left/right facade their entire lives, many have begun to see the world and those around them through that prism. Either someone is on the same “side” as they are, or they are the enemy. There is no room for nuance, no subtle distinctions to be made, no room for alliance or cooperation on matters of great import. Perhaps most devastatingly, there is now little room for any analysis of the powers behind the political throne, the oligarchical financial interests that could care less whether this or that President has a “D” or an “R” next to their name, whether a Prime Minister is “Labour” or “Conservative,” whether an MEP identifies with the “left” or the “right.” Deprived of this understanding of the real nature of political power, the public is truly powerless to identify the real problem at the root of today’s political crisis, let alone even begin to address it.
It is perhaps ironic, then, that at the end of the day the supposedly serious commentators, analysts and talking heads that are paraded in front of the public to comment on this system are little more than buffoons and court jesters, keeping the public entertained and distracted, while some of the most insightful political commentators of our day have been the comedians who have been bold enough to expose this system for what it really is.
http://www.corbettreport.com/divide-and-conquer-politics-and-the-leftright-fraud/ - 72k -
With democrats - it is ALWAYS someone else at fault and ALWAYS someone else that needs to pay (OPM)
——————–
First Baltimore Riot Bill Comes Due: $20,000,000 – Baltimore City Leadership Send Bill To FEMA, Forces All Americans To Pay
Conservative Treehouse | May 26, 2015
It takes some kind of nerve to intentionally “provide space for people to destroy” a city, and then ask everyone who doesn’t live in the city to pay for it.
You might remember this same business became a victim of Mayor Rawlings decision to allow the rioting mob “space to destroy”.
The recent rioting and unrest in Baltimore will cost the city an estimated $20 million, officials said Tuesday.
The expenses — which go before the city’s spending board for approval Wednesday — include overtime for police and firefighters, damage to city-owned property and repaying other jurisdictions for police and other assistance.
Henry J. Raymond, Baltimore’s finance director, said the city can temporarily cover the costs from its rainy day fund while seeking reimbursement for up to 75 percent from Federal Emergency Management Agency.
“The city remains on strong financial footing,” Raymond said.
“Hopefully, with the FEMA reimbursement, it will reduce the financial stress that we’re under. In terms of the city’s overall revenue structure, we’re on firm footing and we’ll move forward.”
Both Gov. Larry Hogan and Mayor Stephanie Rawlings-Blake have requested federal aid.
Hogan has asked President Barack Obama to issue a disaster declaration so the city and state can be reimbursed for some expenses, officials said. Rawlings-Blake, meanwhile, encouraged city-based businesses to apply for aid from the U.S. Small Business Administration and the Baltimore Development Corp
“First Baltimore Riot Bill Comes Due: $20,000,000 – Baltimore City Leadership Send Bill To FEMA, Forces All Americans To Pay
Conservative Treehouse | May 26, 2015
It takes some kind of nerve to intentionally “provide space for people to destroy” a city, and then ask everyone who doesn’t live in the city to pay for it.”
So we have evolved from socializing paying for the debt run up by private entities (banks) to now socializing paying for already socialized liabilities - round and round we go and where this stops nobody knows!!!
That is some PRICEY CVS toilet paper!!!
In fairness, business jets make a lot of sense, especially for corporations based in Flyiver, with little or no airline service. Example:
Shuttle from BFE to Sacramento……..leave early with eight people, on left coast by 9am, full day in the office, back in BFE by 7:00pm local, back at the BFE HQ the next day.
Airline…….two hour drive to airport, fly to hub, change planes, finally arrive in SAC in late afternoon. In office next day, return to BFE day after that.
When you look at the costs (meals, airline tickets, hotels) x 8, vs a one day out and back, the company jet looks a lot better. Not to mention the fact that you are paying eight people to basically sit around in airplanes and airports for two days out of three.
Not included is the money you save by avoiding a bunch of problems caused by grab-assing employees with company paid kitchen passes.
HP used to fly a daily shuttle from Ft. Collins to San Jose. It was very popular, so much so that I believe at one time there were two morning flights. IIRC, Czarly put an end to it. Of course now only “customer facing” employees travel.
In re to HA and his meme on depreciating assets..
I always thought it a misnomer to call say a house a depreciating ‘asset’.
If you have an asset it implies that it holds or increases in value.
If a thing depreciates it is not an asset - it IS a liability.
So….HA - in future please refer to houses as depreciating liabilities…..
Thanks.
“If a thing depreciates it is not an asset - it IS a liability.”
Not true.
Explain please….
A liability is money you OWE. Depreciation is reduction in value of something you OWN. The mortgage is the liability, the house is the depreciating asset.
Thx…
Got it - thanks - I was confusing my liabilities and my assets!!!
I think it’s a liability if you have a note secured to it? Or the cost of upkeep exceeds it’s value?? The first point applies to probably 89% of American’s so it’s a fair summation to call most houses “depreciating liabilities”
“You’re liable to see some depreciation son.”
The other wild card many home owners don’t think about when plunking down their banks money is their liability to taxes. That is a BIGGIE. Taxes are a lot like HOA fees, there really is no fixed cost.
There is nothing a little elbow grease cant solve.
Yeah if you buy a house and sit on your duff and dont do a dam thing then eventually the house wont be habitable.
People who buy houses generally enjoy working on them and taking pride of ownership.
Unfortunately elbow grease won’t fix a furnace, drain field failure, total plumbing rehab and a new roof. Sounds like a house built in 2007! LOL.
Depreciation is a liability.
It just doesn’t have to happen. Its what happens when lazy @ss folks should have kept renting.
Depreciation occurs irrespective of any efforts to prevent it Poet. And at $2.50/sqft/year, it adds up in a hurry.
According to Bank of America “April inflation (in Venezuela) reached 100.7% year-on-year and that monthly inflation averaged 8.5% in the first four months of the year.”
There’s nothing stopping us from doing this here. Why not pay a guaranteed wage of $70K to every adult in the United States directly from the Federal Reserve.
We could end poverty instantly!
Besides we have the reserve currency so it would take a least a couple of years before the 8% / month inflation even get started. How long did it take the United Kingdom to piss away there reserve currency status? We’d have at least that long.
In the meantime we could all live large! No more inequality.
Vote for me for United States President this November 2016 and every citizen will get a check in the mail Feb 2017!
PB - hot off the press for you afternoon cocktail enjoyment…..
BREAKINGVIEWS-Chicago bonds catch mild version of Moody’s blues
Reuters 5/27/2015 4:27 PM ET
Print Article
By Kevin Allison
CHICAGO, May 27 (Reuters Breakingviews) - Chicago’s bond investors have caught only a mild version of the Moody’s blues. The city priced about $670 million of general obligation bonds with yields approaching 6 percent on Wednesday, two weeks after Moody’s Investors Service cut the city’s credit rating to junk. The pricing is, in the end, a fair reflection of the city’s simmering fiscal mess.
Mayor Rahm Emanuel might be tempted to view the bond issue as a victory of sorts. It’s part of a plan to wriggle out of a series of derivatives bets that backfired on the city. Longer-dated bonds maturing in 2042 priced with yields of 5.84 percent. That’s about 260 basis points more than the best-rated U.S. cities might pay. But it’s less than the 300 basis-point spreads the city’s bonds were trading at recently in the wake of the Moody’s downgrade.
By comparison, investors are demanding a yield of around 9 percent to hold cash-strapped Puerto Rico’s long-term debt. Long-dated municipal junk bonds trade on an average of closer to 6.5 percent.
Not-quite-junk is hardly a rallying cry, however. Spreads on shorter-dated bonds are still around 300 basis points. Investors may be more hopeful than Moody’s about Chicago’s ability to plug its yawning $20 billion pension hole by the time longer-dated bonds come due - and they may believe that Emanuel has bought some time, too.
But if the latest bond yields are anything to go by, they remain more sympathetic to the Moody’s analysis than to the more sanguine views of Standard & Poor’s and Fitch Ratings, both of which still rate Chicago investment grade. The music is still playing for the Windy City, but it’s far from cheerful.
CONTEXT NEWS
- Underwriters priced about $670 million of Chicago general obligation bonds on May 27. The city initially offered a 6 percent yield on bonds due in 2042, according to pricing scales obtained by Reuters. It later cut the yield to 5.84 percent, or 264 basis points above Municipal Market Data’s benchmark triple-A yield scale. The city’s bonds had been trading with yields as much as 300 bps above the benchmark recently.
- Credit rating firm Moody’s Investors Service on May 12 cut the third most populous U.S. city’s credit rating to junk status. Standard & Poor’s on May 14 downgraded the city’s credit rating by two notches to three notches above junk status, citing additional financial pressures created by the Moody’s downgrade.
- Reuters: Big demand slices Chicago bond yields as much as 16 bps
RELATED COLUMN
The city that hurts
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)
- For previous columns by the author, Reuters customers can click on (On Twitter https://twitter.com/KevinAllison. Editing by Richard Beales and Martin Langfield)
Netanyahu demands ‘up to $45 billion’ in US military aid for Israel to deter Iran, Gulf States
From the article
Up to 25 percent of Israel’s defense budget is already being funded by Washington under the current agreement, with the figure likely to grow. Israel is already one of the top three recipients of US military aid, vying for the top spot with countries locked in open warfare, like Afghanistan and Iraq.
“Israel has always fought its own battles and has never asked American troops to fight on its behalf. Instead, it has requested US assistance to supplement the tremendous resources Israel already invests in its defense budget,” Howard Kohr of pro-Israel lobbying group AIPAC told the House Appropriations Committee last month.
“The new realities of the rapidly changing Middle East have also led to many unexpected costs for Israel, including the need to build a $360 million barrier along Israel’s southern border with Egypt and a similar, more modern one at its northern border with Syria.”
http://rt.com/news/262505-israel-military-aid-us/
Septic tank necessary evil if you want indoor plumbing.
I have appraised houses where indoor plumbing removed and sold and hole in the floor used as a one-holer.
Doesn’t work with a concrete slab.
Worry about e-coli overstated. Seen houses where septic tank dumped waste out put pipe 5′ from well
Homeowener commented not too much problem as they had good regular bowel movement..but well produced enough water to meet water quantity requirement of well.
If you appraise in a lot of places you do get surprised at things.
Think on this one folks:
If stocks were to crater and bond yields rose significantly it could bankrupt a lot of countries.
And make the US very wealthy.
More paid actors working talking points in from tragedies performed by paid actors.
Gun Control Group Deceives Public by Hiring Paid Actors for “Hidden Camera Experiment”
Anti-gun group also reportedly ignored gun laws in filming fake video
by Kit Daniels | May 27, 2015
Paid actors posed as “potential gun buyers” who were “convinced” by a “gun store clerk” – also an actor – not to buy a firearm as part of an anti-gun group’s “experiment” designed to deceive the public.
It was previously known that the “clerk” in the “hidden camera experiment” produced by States United Against Gun Violence was an anti-gun activist actor, but a journalist recently discovered that all the “gun buyers” in the video were paid actors as well.
“That’s quite the ‘hidden camera social experiment’ when your [filming] permit is for ‘actors’ to be ‘interviewed,’” David Codrea of the Shooter’s Log reported, who filed a Freedom of Information Act (FOIA) request for the filming permit.
Additionally, the gun control group may not have followed the city’s gun laws because, as Codrea pointed out, records for the fake gun store’s inventory were no where to be found.
“Noting the complexity of special theatrical permit requirements for applicants and dealers, and restrictive New York laws on imitation firearms, it’s surprising to find that a fake gun shop can be set up contained hundreds of replica weapons with no paperwork, apparently on just the say-so of on-site NYPD officers,” he wrote.
So basically, a gun control group filmed a fake clerk of a fake gun store obtaining fake reactions from fake customers and then presented the video as genuine to the public.
That’s the anti-gun movement in a nutshell; unlike pro-gun activists who volunteer their free time to organize public rallies to promote the Second Amendment, authoritarians hire paid actors to deceive the public into surrendering their gun rights.
That’s because gun control did not originate from the grassroots but is rather a top-down movement bankrolled by powerful politicians, such as former New York mayor Michael Bloomberg, who want nothing more than to expand government powers at the expense of individual liberties.
Guns With History - YouTube
http://www.youtube.com/watch?v=1nAfWfF4TjM - 209k - Cached - Similar pages
Mar 17, 2015 … SHOW YOUR SUPPORT, sign our petition at http://action.ceasefireusa.org/p/dia/ action3/common/public/?action_KEY=19750 States United To …
$30k price drop , 1 hrs north of Santa Barbara, built on sand.
http://www.coterealtors.com/Property/Detail/3740-Hillview-Rd-Orcutt-CA-93455/2400601055454/
the cabinet doors r hideous. Otherwise seems like a nice crib. Seems affordable for that area. Starter home? Never heard of the town before.
only about 9x local household wages. The town is Santa Maria, know to locals as Santa Manure. Lots of mex gangs.
Derivative:
A security whose price is dependent upon or derived from one or more underlying assets. The derivative itself is merely a contract between two or more parties. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies, interest rates and market indexes. Most derivatives are characterized by high leverage.
News flash:
Government sponsored housing price inflation dtives increase in California homelessness.
UT-San Diego
People
Downtown homeless up 26 percent
Annual count shows sharp increase in number of unsheltered people
By Gary Warth 05:00p.m. May 25, 2015
A homeless couple downtown.
More than 800 homeless people were living unsheltered on the streets of downtown San Diego in January, an increase of about 26 percent since last year, according to updated numbers from an annual count by the Regional Task Force on the Homeless.
“I think everyone is frustrated, because there’s a difficulty in claiming our title as America’s finest city when we have so many people who don’t have homes,” said San Diego City Council Todd Gloria, whose district includes downtown. “This is probably the top issue I hear about from my downtown constituents.”
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LA Times
Homelessness up 12% in L.A. city and county
Homelessness and Venice Beach curfew
Protesters gather last month just beyond the boardwalk in Venice Beach to challenge the city’s midnight-to-5-a.m. curfew, which they contend focuses mostly on removing homeless people. Officials plan to release an updated tally of the homeless population in L.A. County.
(Mariah Tauger / For The Times)
By Gale Holland and Soumya Karlamangla contact the reporters
An official homeless tally shows a sharp rise in displaced population of city and county of Los Angeles
The homeless population jumped 12% in the last two years in both the city and county of Los Angeles, driven by soaring rents, low wages and stubbornly high unemployment, according to a report released Monday.
In one of the most striking findings, the number of tents, makeshift encampments and vehicles occupied by homeless people soared 85%, to 9,535, according to biennial figures from the Los Angeles Homeless Services Authority.
“It’s everywhere now; the encampments are in residential neighborhoods, they’re outside of schools,” said L.A. City Councilman Mike Bonin, who represents Venice.
“It’s jarring. … It shows we’ve got a hell of a lot of work ahead.”
…
Does pondering international soccer scandals help take your mind off homegrown race riots?
Can you imagine? These people don’t even know the difference between soccer and football.
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Fifa officials corrupted football - US prosecutors
4 hours ago
From the section US & Canada
Media caption The BBC’s Richard Conway asks: “If the corruption investigations are good news, what does bad news look like for Fifa?”
US prosecutors have accused several officials from football’s governing body Fifa of racketeering, fraud and money laundering involving tens of millions of dollars over 24 years.
Prosecutors said they had discovered a dozen schemes, including one awarding the 2010 World Cup to South Africa.
Fourteen people have been indicted, with seven held in Zurich on Wednesday.
Fifa president Sepp Blatter, who is not among them, issued a statement vowing to kick out corrupt officials.
Fifa also announced a “swift and immediate provisional ban” from football-related activity on 11 of the people involved in the US prosecution.
Fifa says it still intends to hold its presidential election on Friday. Mr Blatter is favoured to win a fifth term.
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Does pondering international soccer scandals help take your mind off homegrown race riots?
Is there some sort of connection between the two things?
I’m sure the timing is pure coincidence.
Does pondering international soccer scandals help take your mind off homegrown race riots?
Are rigged soccer matches a greater crime than rigged markets?
phony scandals