The Housing Bubble

I’ve had a position in the energy spider (XLE) since around 2001. I remember thinking to myself in June or July of 2014 that maybe I should sell, but I didn’t. It’s down about 30% since last summer’s highs.

It’s performed fairly well over the past 14 years and the trailing 12 month dividend is about 7.4% of my cost basis. It’s greatly outperformed the SP500 over my holding period.

I think the key is the time in the market (rather than timing the market) for this one (XLE).

Precious metals have not been doing well over the past 3-4 years, but you need to go back and review why you bought them in first place. In my case, the reasoning was to diversify into another asset class to help stabilize the portfolio. With a 2006 basis, the GLD position is showing about a 7% CAGR return over the holding period to date. That’s way down from 2011, but still an acceptable performance given its role as an asset diversification vehicle.

I was early into the Emerging Markets when I started dollar cost averaging into the Vanguard Emerging Markets index fund, down about 11-12% over the last 18 months. I’ve been thinking harvesting the tax loss and putting the proceeds into the Total International Index fund, which still has about 18% exposure to the Emerging Markets sector.

I’m also getting murdered in my Royal Dutch Shell, BHP Billiton, and BP holdings!

Hope that crushing. commodity. losses. leads to crushing. housing. losses so I can afford a crap shack at a bargain price.

Sold all my KMI stock last week. Came out with a small profit…used to a very big profit just a few months ago.

Of course, the day after I sold my stock, the Vampire Squid (Goldman Sachs) comes out with a “must buy” for it’s dividend–pushing the stock up.

Bernie Sanders is Jewish. How does this affect everything?

Jews consistently vote (on average) 75%+ for democrats.

In fact, they are about as staunch supporters (votes and money) for the democrats party as you could find (on par with blacks and unions).

https://www.jewishvirtuallibrary.org/jsource/US-Israel/jewvote.html

“It goes without saying that you don’t have to be Jewish to be in the thrall of Zionist ideology; and also that, even among Congressional Democrats, rabid Israeli chauvinism afflicts only a minority of American Jews.

Indeed, in Congress, refractory Democrats like Schumer are not the main problem. That dubious honor goes to the entire House and Senate roster of Republican members. Each and every one of those miscreants puts Israel’s interests, as the Netanyahu government understands them, first.”

Exactly… the U.S. does not come first in their agenda.

will El Nino rain on California’s real estate parade?

Nah. If we get lots of rain the lawns will green up again, boosting curb appeal. Our Zillow numbers will go up again. Life will be good again here in the Golden State.

Screw the used home sales people. We need the rain!

Unfortunately for California, whenever we get weather conditions to end a drought, they inevitably come with floods and mudslides in the numerous recent-burn areas, not to mention in every other low-lying area with a dry stream bed.

With all the flooding and mudslides that would result from an El Nino, it good in the sense of where NOT to buy a house.

That’s 80 Tianjin port explosions every day.

Cell phones kill more people than handguns.

Good thing they filmed the ny million dollar listing show way back

Usually by this time of the year the number of properties for sale on the CNY Homes is below 2000 homes for sale. This year it is about 4 times as many. Nothing much is selling above the $300K but homeowners keep listing homes at their wishing prices. Homes are selling that are priced between 50K to 170K, At the rate homes above 300K are selling we have about 20 to 30 years of supply and more homes for sale keep coming on the market.

7351 homes for sale.

http://www.cnyhomes.com/Listing/Search/search.cgi.

11,094 properties for sales on CNY realtor

http://search.cnyrealtor.com/SiteContent/PropertySearch.aspx?listview=Y

I saw someone wine driving a car
Oxide are you seeing inventory build since 7/5 in your sector.

Oxide is inventory building in your oblast ?

What China did in the last decade will not be seen again in our lifetimes.

Yes they will…in a couple of decades from now.

That predicted $80/bbl price by December 2015 is looking more and more like a pipe dream.

Markets Commodities Oil Markets
Oil Futures Signal Weak Prices Could Last Years
The oil market indicates that prices could stay lower for longer, delivering a fresh blow to hard-hit energy exploration-and-production companies
By Nicole Friedman
Updated Aug. 10, 2015 9:01 a.m. ET

The oil market is signaling that prices could stay lower for longer, delivering a fresh blow to hard-hit energy exploration-and-production companies.

Benchmark U.S. oil futures for September delivery are nearing the six-year low hit in March. But contracts for delivery in later years have taken an even bigger hit, with prices for 2016 and 2017 already trading below their March lows.

That indicates that investors, traders and oil companies see the global glut of crude oil persisting beyond this year.
…

It’s hard to excerpt this article, because it all needs to be read, if you dare.

Behind the scenes of the Donald Trump-Roger Stone show
by Tyler Durden

The three main takeaways you need to keep in mind in the Roger Stone-Donald Trump story are:

Roger Stone’s dirty tricks specialty is manipulating voter fractures, and weaponizing anti-establishment politics to serve the electoral needs of mainstream Republican candidates;
Roger Stone and Donald Trump have been working together since the mid-1980s, mostly on sleazy campaigns to help Trump’s casino business, but also in politics;
Roger Stone and Donald Trump worked together in at least two major “black bag” operations manipulating anti-establishment politics to help the mainstream Republican presidential candidate;

…As luck should have it, Muskie [read: Sanders] was hounded at his Florida hotel room during the primaries there by “angry” black picketers—who were secretly under Nixon’s White House supervision—demanding, angrily, that Muskie agree to name an African-American vice presidential candidate…

Muskie had his alleged meltdown in front of reporters—as snow fell on his face, he lashed back at the Nixon White House, but some national reporters mistakenly described the melting snowflakes on Muskie’s face as tears, and described his anger as a “breakdown.” Muskie was finished. Sort of like how Vermont front-runner in 2004, Howard Dean, was finished off by the one-two of Dean’s screechy “woo!” gesture, and Al Sharpton accusing Dean of being anti-black during the debates.

…As it turns out, Al Sharpton entered the 2004 Democratic primaries on the payroll and orders of Roger Stone, who directed Sharpton’s attacks from the race politics-left against Howard Dean. And as the New York Times revealed that year, it was Donald Trump who took credit for introducing Al Sharpton — a one-time FBI informant — to his old friend and lobbyist, GOP dirty trickster Roger Stone.

http://webcache.googleusercontent.com/search?q=cache:QSGCT-eAYscJ:www.zerohedge.com/news/2015-08-13/behind-scenes-donald-trump-roger-stone-show+&cd=11&hl=en&ct=clnk&gl=us

How quaint. That is so 1975.

Because they’re not going to be in ‘public service’ forever. And if they don’t take care of business, business won’t take care of them.

‘Sinecure’.

What are the odds someone will make a quip using the words “butter” and “maple syrup”?

she is still lookn good.

Who’d u rather, kim k. or sharon stone?

Even in self deprecation this is still a sign of one if the scourges of our time, blatant rampant narcissism. Look at me naked, look at me, look at me.

Was that in 1991 or is that recently? If recently, more likely it is like a bag of flapjacks.

If Sharon Stone’s ass looks like a bag of Flapjacks, what the hell does Hillary Clinton’s ass look like?

Never mind, I withdraw the question.

“Hired protesters with the Black Lives Matter”

Hired by whom?

“As luck should have it, Muskie was hounded at his Florida hotel room during the primaries there by “angry” black picketers—who were secretly under Nixon’s White House supervision…”

Comment by phony scandals
2015-08-15 05:48:48

#CutTheCheck
By Jessica Chasmar - The Washington Times
washingtontimes.com/news/2015/may/19/hired-black-lives-matter-protesters-start-cutthech/

Once the tech bubble pops, watch out.

Looking further ahead to the future, the prospect of a jobless economy certainly seems daunting. But if we can successfully manage it and put our machines to work, we could enter into an unprecedented era of material abundance while dramatically extending our leisure time. Rather than be tied to menial and demeaning work, we’d be free to engage in activities that truly interest us.

Hughes agrees — and he doesn’t believe that BIG will kill motivation.

“It is very recent in human history that we learned to be motivated to work for pay, and were convinced that those who didn’t work for pay should feel shame about it,” he says. “For women that transition only occurred in the last two generations. And there have always been aristocrats who found motivation to get out of bed in seeking prestige or power or simply the intrinsic rewards of the activity, like scientific discovery. It will certainly require at least a generation to transition from a psychological and cultural assumption that self-worth requires work for pay to a society where we find self-worth in voluntary activities. But some of us are already there.”

‘We are a rich enough and productive enough country to provide everyone with a guaranteed income of $35000 a year, tax free, no work.’

I’m still waiting on the paperless office.

$35,000 x 330 million “citizens” = $11,500 Trillion/year

Federal Budget = $3 Trillion/year

USA GDP = $17 Trillion/year

FAIL

Many fewer people are needed to work today to produce the goods and services to allow this level of comfort.

A co-worker said a young guy knocked on the door soliciting his lawn mowing service. He glanced at the mower sitting out at the sidewalk and asked, “How much?”

Hmm, well (sizing-up his ability to pay)… how about $40?

Are you serious? Really?? GET THE F**** OFF MY PROPERTY!!

“We are a rich enough and productive enough country to provide everyone with a guaranteed income of $35000 a year, tax free, no work. We can do this.”

I wouldn’t try for $70,000

$70,000 minimum salary causing hard times for Seattle CEO

Jerry Newberry, MorningTicker | August 01, 2015

Dan Price, the CEO of Gravity Payments recently made headlines by declaring his company would raise its employees to a minimum salary of $70,000, says the decision has caused him to fall on hard times.

Price, according to a report on Fox News, is renting out his own house in an attempt to make ends meet. This is just three months after the announcement that all 120 employees of the credit card processing firm would receive raises to the minimum.

The move cost him a few of his good customers and two of his “most valued” employees, who left the firm because many new employees received larger pay hikes than older employees.

Read more at http://www.morningticker.com/2015/08/70000-minimum-salary-causing-hard-times-for-seattle-ceo/

buy a shack and get rich!

and you call me a racist for point out this explosion in black mob violence.

It adds to GDP. What’s wrong with it?

“Correlation is not causation.”

I don’t have a great sense of what those metrics indicate. However at a glance it seems like 2015 is playing out similarly to 1987, when the Black Monday crash in October was preceded by an all-year slow motion meltdown of the junk bond market.

It’s almost as if Darth Cheney was correct “Deficit’s don’t matter.”

If we run a debt but keep up payments on it, that helps our credit score, right?

I thought the same in 1979.

I never want to move out of the big city to the boondocks. Doomsday was canceled in 1979. The ones who stayed in the large cities prospered. And it’s the same today. Better jobs, better medicine, better medical facilities.

I lived out in Ridgecrest in the 80s and early 90s. I remember being told that if the big quake hits L.A. Ridgecrest and other high desert communities would be doomed because they would be low on the priority of rescue / recovery. And there are quakes in the high desert.

I betcha 95% of the regulars on HBB do not have any survival skills. I know I don’t. I don’t have any bartering skills either. I’m only skilled in high tech.

I’m not sure which is more likely: A zombie apocalypse or a 20 mile wide meteor striking the earth.

I’ll see your -0.77 and raise you a degree

http://ds.data.jma.go.jp/tcc/tcc/products/gwp/temp/jul_wld.html

July 2015 warmest global temps on record…

I guess the ban is still there for the most part. Seems like it would be good for U.S. producers to eliminate it entirely, at least so long as they have an opportunity to sell for a higher price on the world market compared to the domestic market. Why not level the playing field for U.S. producers, given the recession that has already hit the industry?

U.S. Commodities
U.S. Loosens Longtime Ban on Oil Exports
Companies will be freed to swap light, sweet crude for heavy Mexican crude
Oil companies and their allies in Congress have been pushing the Obama administration to relax restrictions on U.S. oil trade with Mexico.
Photo: Associated Press
By Christian Berthelsen, Lynn Cook and Laurence Iliff
Updated Aug. 14, 2015 6:44 p.m. ET

Energy companies eager to export American crude oil scored a victory Friday when Washington agreed to allow them to trade oil with Mexico, in a further erosion of the four-decade ban on selling U.S. crude overseas.

The U.S. Commerce Department told members of Congress it intends to approve an application by the national oil company of Mexico to exchange heavy oil pumped there for light crude pumped in the U.S., according to people familiar with the matter.

The deal, which will give American drillers a new market for their product, is a significant step toward lifting the export ban that dates to the Arab oil embargo of the 1970s, when the U.S. suffered though gasoline shortages. Since then, the U.S. has allowed few overseas shipments of oil, with a current exemption for Canadian refineries, which send a lot of gas and diesel back to the U.S.

The laws barring overseas sales have come under pressure in the past year as American drillers pumped surging amounts of crude from shale formations, helping to create a global glut that has brought down oil prices by half in the last 14 months. Congress is slated to take up the matter later this year, and several top lawmakers back unfettered domestic oil exports.

U.S.-traded oil closed at just over $42 a barrel Friday, down from over $100 barrel in June 2014. Global oil prices remain more than $6 above the price of U.S. crude, and that difference has been as high as $20.

The swap deal with Mexico doesn’t need congressional approval. Such oil trades—which aren’t considered true exports because the U.S. is getting oil in return—were contemplated under the original ban legislation, but haven’t taken place before.

The deal illustrates how Washington is trying to catch up to a dramatic new energy abundance in the U.S., said Daniel Yergin, vice chairman of IHS Inc., an energy consultancy. “It’s pretty clear, directionally, where things are headed,” he said. “This ban becomes more and more awkward and ill-fitting. It doesn’t fit reality.”
…

Bend over, ‘Muricans.

https://www.flickr.com/photos/expd/16629031224/

WSJ PRO
China Stock Futures Signal Deeper Pessimism
The Shanghai Composite has remained relatively flat since the yuan began sliding, but futures tell a more negative story
By Chao Deng
Updated Aug. 14, 2015 9:10 p.m. ET

HONG KONG—As global financial markets try to gauge the impact of a weaker yuan, China’s stock-index futures are signaling that investors are more pessimistic than current Shanghai share prices suggest.

Textbook financial theory says a currency devaluation such as the one China’s central bank engineered this week should support stocks by making them cheaper for foreign investors and lifting business prospects for local exporters. The Shanghai Composite Index has remained relatively flat since the yuan began sliding Tuesday. Stock stability in China should please regulators after their summertime battle to prop up shares.

Yet, the level of futures that trade based on Chinese share indexes tell a more negative story about investor expectations for Chinese stocks. CSI 300 Index Futures, which track an index of the 300 largest companies listed on the Shanghai and Shenzhen stock exchanges, continue to point lower.

On Thursday, the CSI 300 futures contract that trades on the China Financial Futures Exchange in Shanghai and is due to expire on Aug. 21 traded at a 1.5% discount to the actual index, while the contract due to expire in late September stood at a nearly 3% discount. A discount is a strong indicator that investors are bearish, traders say.

August 13, 2015
China’s Long Minsky Moment
By John Cassidy
Beijing’s devaluation of its currency could be a sign that the economy is approaching the point when euphoria is replaced by pessimism and downturn begins.
Credit Photograph by ChinaFotoPress / Getty

In the wake of Beijing’s decision to devalue its currency this week, the scuttlebutt that has been circulating in western financial circles for months has made the front of the Times: an article by Neil Gough, datelined Hong Kong, relayed concerns that the Chinese economy probably isn’t growing at the official annual rate of seven per cent, and that, in fact, the official figures are so unreliable that it’s impossible for outsiders to figure out what’s really happening.

That’s what Bill Miller, the renowned investor, and other Wall Street skeptics have been saying for months, and I suspect they are right. Is it really plausible that in the first and second quarters of this year the Chinese economy expanded at an annualized rate of precisely seven per cent, which just happens to be the official target for growth in what President Xi Jinping has called the “new normal” era?

In 2010 alone, the amount of debt taken out by Chinese businesses and households jumped by about thirty-five per cent of G.D.P.

These figures, which I took from a paper published earlier this year by Steve Keen, an Australian-born economist who monitors debt closely, suggest that what we are observing in China is the unusually elongated aftermath of a “Minsky moment”—that dreaded moment, named after the late post-Keynesian economist, when euphoria is replaced by pessimism, asset prices start to plummet, lenders discover that their creditors can’t replay their loans, and an economic downturn begins. Or, as Deng Xioping might have put it, we have a Minsky moment with Chinese characteristics.
…

Forget Greece: China’s economic slowdown is the biggest story of the year
There’s hardly an industry or a part of the world that isn’t counting on China to keep growing strongly. Soon, that could be a big problem
Elliot Wilson
15 August 2015

I stood alongside the chairman of the board of a state-owned enterprise in eastern China. The factory floor, partially open to the elements, stretched out far in front of us, littered with towers and blades designed for some of the world’s largest wind turbines. It was an impressive sight, one to which regular visitors to mainland factories are accustomed: China as the workshop of the world.

But something was missing: workers. ‘They’ve been given the day off,’ the chairman said with a slight cough, as we stared out over the vast compound. On a Wednesday? It was hot but not searing, and workers get the day off only once the mercury tops 40°C. ‘It’s a local holiday,’ he said. But there are no such things in the People’s Republic, and national holidays only occur in May, October and around Chinese New Year.

I didn’t push it, but a later conversation with the firm’s senior engineer, a stocky chap in blue overalls clutching a pipe wrench, revealed the real problem. His cheery demeanour vanished when we started discussing the future. The factory, he admitted, hadn’t run at close to full capacity for a year. Experienced workers had been put on unpaid leave; migrant labourers from the countryside — lacking a local work permit, or hukou — had been told to hop it.

The company’s woes are a microcosm of the daunting challenges that face China’s stuttering economy, the world’s second largest after the United States.

I think they’ve shot enough sellers that market sentiment is brutally bouyant.

Been around the world and found that only stupid people are breeding
The cretins cloning and feeding
And I don’t even own a TV….

Harvey Danger, Flagpole Sitta

https://www.youtube.com/watch?v=jJo0MT3wDBs

And so it was that later
As old phony told his tale
That her face at first just ghostly
Turned a whiter shade of pale.

http://www.youtube.com/watch?v=St6jyEFe5WM - 373k -

Muffins you say? Aren’t we exchanging one metaphoric horror for another?

Deflation is something the Fed religiously avoids. Believing that deflation is on the way is tantamount to a belief that the Fed cannot prevent it.