An Investment That Isn’t Working
A report from the Dallas Morning News. “Hey, real estate is back! It’s not just San Francisco and its new homes ’starting in the $1,000,000s,’ as the now famous billboard cries out. I’m thinking about this while spending a few days in Sonoma County. California real estate is headed back to prices that can only be described as bubbly. The rising level of house prices also works to increase price levels for all houses and that, in turn, is reopening a dream for others — the home as ATM. Some recent research from Black Knight Financial Services, a mortgage data-crunching firm in Jacksonville, Fla., suggests this. The firm’s February mortgage monitor reports show strong cash-out refinancings across the country. The leader? California.”
“In the fourth quarter of 2015, the report notes, California refinancings accounted for 42 percent of the $7.6 billion of equity ‘extracted.’ The equity-mining home owners in California averaged a $98,000 cash-out. Typical cash-outs elsewhere were about $60,000.”
KOIN on Oregon. “With skyrocketing home prices, high demand and low supply, there’s no denying Portland is experiencing a housing crisis. The Montavilla bungalow Samantha Gladu was interested in sold for $224,000 a year ago. Now, it’s worth over $100,000 more. But she and her husband say it’s worth it. Unfortunately, she wasn’t the only interested buyer who loved the house. ‘We’ve had houses that we put in an offer and there are 24 other offers,’ Gladu said. ‘Things are going for about $30,000 over.’”
The New York Times. “Apartments for billionaires were all the rage in Manhattan three years ago when the developer Joseph Chetrit paid $1.1 billion for the granite-sheathed Sony Building at 550 Madison Avenue. Now, in the latest example of the slowdown at real estate’s highest end, Mr. Chetrit signed a deal this week to sell the tower for $1.4 billion to the Olayan Group, which is controlled by a Saudi family, and Chelsfield, which manages its properties. The companies said the building would become, yes, an office building.”
“Mr. Chetrit and his partner, David Bistricer, were under pressure to pay off short-term loans on the property totaling $925 million. They also had trouble obtaining a construction loan as lenders became wary of projects promising oversize prices and profits. Over the past three years, said Nancy Packes, a consultant for luxury residential projects, the market for billionaire apartment buyers has gone from ‘mush to ice.’”
The Real Deal in Florida. “As South Florida’s residential real estate market starts to downshift, a new report shows cash sales and bulk home purchases are beginning to thin out. Cash deals, in which a buyer closes without using financing, were down to 53.9 percent of all sales in the first quarter, according to RealtyTrac. Though that ratio has only fallen by about 0.9 percentage points from the end of 2015, it’s dropped 6.6 percentage points year-over-year. ‘While large institutional investors and other cash buyers continue to shrink as a share of U.S. home sales, these buyers still typically beat out traditional buyers using financing — in some cases even when they submit a lower offer for a home,’ Daren Blomquist, senior vice president at RealtyTrac, wrote in the report.”
“South Florida is also seemingly being drained of its bulk buyers, defined by RealtyTrac as investors who pick up 10 or more residential properties at a time, whether they be single-family homes or condos. Those types of buyers have never had a large market share in South Florida, even in hot years like 2015 when roughly 4 percent of the first quarter’s home sales were bulk purchases. The first quarter of 2016, however, saw only a bulk purchase market share of 2.5 percent. Market-wide, bulk purchases came with a 19 percent price discount in South Florida during the first quarter, the report showed.”
The Herald News in Massachusetts. “For the second time in a month, a Fall River City Councilor is facing foreclosure proceedings on a rental property. This time, it’s President Shawn Cadime, whose property at 983 Rodman St. was listed in a legal advertisement for foreclosure in The Herald News on April 18 and April 25. The Rodman Street property is one of three investment properties that he owns in the city, he said, and attempting to sell it or have it taken into foreclosure was a ‘business decision.’”
“Cadime said he bought the property in 2005 at the height of the housing market, and then it ‘crashed in 2008.’ There has also been a large reduction in rents that landlords charge compared to the time he purchased the properties, Cadime said, and he said the rental demand in the city is lower. ‘You’ve got to make a decision and not hold onto an investment that isn’t working,’ Cadime said.”
KARE on North Dakota. “In the last two years, Williston has gone from overcrowded boomtown back to quiet hometown. There are clear signs across the region that housing and infrastructure built during the boom is now at risk of sitting unused. ‘Everybody’s trying to figure out what’s it going to take to keep them afloat,’ said Dave Rousher, manager of ND Indoor RV Park, which was built by a Minnesotan near Watford City.”
“At its peak, ND Indoor RV Park was overflowing with a waiting list. But now, Rousher believes they are doing better than most at just 38 percent full. ‘The people who came and built things around here, they’re depressed. They have bills to pay. And a loan to pay. So they’re depressed,’ Rousher said.”
An article about GDP being a bad gauge of material well being and now it is time for a fresh approach …
http://www.economist.com/news/leaders/21697834-gdp-bad-gauge-material-well-being-time-fresh-approach-how-measure-prosperity
IMO this point of view is a no-brainer if the measurement of phantom income - imputed income, income that cannot be spent - is a major factor that goes into computing GDP.
“Anyone claiming that America’s economy is in decline is peddling fiction.”
–obama, March, 2016
Um…yeah. While Obama’s Wall Street patrons are doing just fine, the real economy is showing more slippage.
http://www.zerohedge.com/news/2016-05-02/no-end-sight-current-downturn-us-manufacturing-plunges-sept-2009-lows
Was listening to Larry Kudlow’s podcast from Sat - the following:
GDP- 0.5% 1st Q
1.4% 4th Q of 2015
2.0% average last 7 years
Business Investment has collapsed leading to issues with jobs, profits, wages and the like.
Minus 4% annualized the last 2q’s
Inside that - minus 5% invest in software and equipment last several quarters
-8% invest in non - residential structures (offices, hotels etc.) last 2 q’s.
Last 32q’s business fixed invest avg 1.1% annualized rate. By measure since 1960 invest by business has averaged 4.0% annualized.
Kudlow did not source his information though it has been recently reported in the WSJ ( I know - owned by Murdoch - I know) but this is to me still telling.
Conclusions there HBB’ers?
Collapsing demand my friend. Collapsing demand.
Agree.
I don’t know bout other locales but here in Chicago - when I am driving home from the train or directly from my field office job the traffic on the road is WAY down - noticeable difference in even the last year. It is just kinda feet on the ground stuff but I ask many times while driving - Where is everybody? Six o’clock on a week night - prime time for workers to be heading home - and what I see - not so much.
So….I agree - demand is down - way down.
if the measurement of phantom income - imputed income, income that cannot be spent - is a major factor that goes into computing GDP.
Should rent paid to a landlord be counted?
I think that’s counted as real income, not imputed income.
Correct. Less losses to depreciation.
Where do they get the depreciation numbers? Tax returns? Assessed values from the county tax collectors?
Daddy bought a house in 1960 for $14,000, depreciated $10,000 for the structure. Skippy inherited the house in 2014 when Daddy died and the unimproved house fair market value is $500,000. Skippy depreciated $400,000 of the structure (1 year’s portion 14,545) on his 2015 tax return.
Someone here will assure us that structure can be demolished and rebuilt for ahelluvalot less than $400,000.
Problem is your hypothetical doesn’t work when there is no buyer at that price.
So every house needs to be designated own-occupied or rental when calculating GDP? I think that’s the difficulty. Also, does the house suddenly lose value if the landlord moves in?
“GDP falls when a man marries his maid.”
The big argument against GDP as it’s measured now, is that it overcounts manufacturing and undercounts services. I suspect if they altered it to reflect the increase in services in an economy, many would howl that they’ve changed it to funny money numbers, it’s now meaningless, , and shadow stats would defiantly show the old way of counting it.
Irrelevant.
A property bubble is developing in the Dublin housing market with residential property prices having surged by 50% on average and as much as 100% in more affluent areas since the Dublin property market began to bounce in 2012.
Respected Irish economist and economic commentator Colm McCarthy warned last week that “there is another house price bubble under way in the Dublin area.”
While all the focus is on the housing crisis and the rising threat of homelessness for many including families, and rightly so, less attention is being paid to the surge in prices in Dublin. Prices have risen by so much that modest 3 bed and 4 bed houses in middle class suburbs in Dublin are now unaffordable to typical middle class families.
Many families need financial support from grandparents in order to be able to buy. This means that the majority of buyers are buy to let investors looking to profit from rising yields as rents spiral higher. Many of these buyers are cash buyers.
Writing in the Independent, McCarthy warned of increased speculation and “extraordinary prices”:
“Notwithstanding the efforts by the Central Bank to keep mortgage credit under control, some extraordinary prices have been quoted recently for the small parcels of land that become available.”
http://news.goldseek.com/GoldSeek/1461849692.php
“In the fourth quarter of 2015, the report notes, California refinancings accounted for 42 percent of the $7.6 billion of equity ‘extracted.’ The equity-mining home owners in California averaged a $98,000 cash-out. Typical cash-outs elsewhere were about $60,000.”
Hey, that could be me! I just now did a Zillow and I learned that the value of my house increased by $5,751 over the past thirty days. I should call up Zillow and thank them for the prosperity.
But wait! It’s not Zillow I should thank; Who I should thank are … are a bunch of strangers. Very strange strangers at that in that they would do such a strange thing as to jump of the value of my house - a comp - by such a astounding amount as $5,751 over a period of time of only thirty days.
Strangers who, as the evidence suggests, have lost their minds.
So I should do what? I should cash out the newly-generated equity of my house that has its generation rooted in prices, prices that are set by strangers, strangers who have lost their minds?
No thanks. This one is for watching, not for doing.
Popcorn and all that.
But wait! It’s not Zillow I should thank; Who I should thank are … are a bunch of strangers
Isn’t that how all markets work?
“At its peak, ND Indoor RV Park was overflowing with a waiting list. But now, Rousher believes they are doing better than most at just 38 percent full.”
Just 38 percent full, they are doing better than most at just 38 percent full.
“‘The people who came and built things around here, they’re depressed. They have bills to pay. And a loan to pay. So they’re depressed,’ Rousher said.”
And a loan to pay. A loan no doubt taken out when the RV park “was overflowing with a waiting list”.
Now the waiting list has evaporated and the park is just 38 percent full and as for the loan - it’s still there!
For now. But stay tuned.
The unindicted felons of the DNC need all the criminal votes they can get to impose their regime of the takers.
https://www.yahoo.com/news/federal-jobs-felons-why-ban-box-could-soon-112707622.html?nhp=1
Ante up, taxpayers, for another corrupt Democrat-looted and maladministered basket case. It won’t be the last one, so get used to digging deep.
http://www.businessinsider.com/puerto-rico-government-development-bank-default-2016-5
Precious metals are soaring as more and more investors realize the Fed is going to print us into Weimar 2.0.
http://wolfstreet.com/2016/05/01/dollar-loses-yen-euro-risk-vix-vxx-fleeing-into-gold-silver/
Ha, paper gold.
Go down to your local coin shop and try to pick up physical metal for the “paper gold” price. Good luck with that. And when the COMEX fails to deliver (being levered more than 300 to one with actual, on hand physical gold stocks) the price of physical precious metals - the only kind worth having - is going to soar even further.
I haven’t gone to my local coin store yet, I’m curious as to their prices though. I’ve utilized Apmex.
The stories are already coming out about the open manipulation of gold/silver. Of course you read the news.
The only paper worth it would have been miner stocks bought last year.
The best of all worlds will be coin shops you can walk into and trade Bitcoin for physical metals and metals for Bitcoin. So far you can do that online at JM Bullion, and various small coin businesses.
Once this physical exchange deal is possible (most likely will happen in the NYC, Chicago, and Southern California coin shops first), you can play the two, metals and crypto currency, against each other. The problem is that they seem to be highly correlated as the alternative to fiat and the place to go to with capital controls more and more likely.
But it would be nice anyway. Suppose I have a quarter oz eagle worth $1000 (it is about $330 now) but want to buy a Dell computer with Bitcoin. I sell the eagle at the coin shop and receive $1000 fiat worth of Bitcoin at my public address. Then I turn around and send $1000 to Dell to get that computer. No fiat involved. Dell takes Bitcoin.
Tiger Direct also takes BitCoin, Newegg is/was rumored to as well. Isnt the Microsoft store opening up to Bitcoin? Honestly for as computer savvy and digitally driven as I am, I have not considered bitcoin ever since the massive run up on Radeon GPUs and people trying to compete with massive supercomputer farms mining.
The coin sale and the bitcoin transaction are done under the watchful eye of the government. Cash, not so much.
I’m still trying to wrap my mind around the idea that you like both physical gold and ephemeral Bitcoin. I suppose they are both good diversification against fiat. But in a SHTF scenario, obviously physical is better. And Bitcoin seems risky even when the system is up and running.
If I were to go into physical, I’d probably do silver simply because the barrier to entry is lower, and comes in smaller denominations.
Plus you can buy “junk” silver, Gold, not so much.
Get some pre-1964 quarters, mercury dimes, or Kennedy dollars.
I get the whole “crypto currency” appeal to some but if the NSA/CIA can read every text, foreign cable, tap trans Atlantic fiber networks, don’t you think they could trash crypto currency w/o much effort? Even if it did require substantial effort they would just work round the clock, they have unlimited resources until people stop paying taxes. Uncle Sam sent people into Space with basic computers and millions of lines of old school code, I think breaking crypto currency in a SHTF scenario would be a cake walk.
Yeah I advise my sister to load up on silver eagles, like one a month. I am not sure she could afford to buy tenth gold but the premiums are too high that I would not advise it for her.
Bitcoin is risky.
Gold is risky. Gold in the long run does not do as well as stocks. Gold is a savings vehicle. Gold mining is an investment. I keep both concepts separate. I will sell my gold mining stocks in a few years, perhaps 5, but I am bullish in the long run (ten years or more).
I don’t do any paper trail when I buy gold. Nor when I sell gold. Never ever. I keep amounts under $10,000.
Bitcoin - all they got is addresses. I create my own. When a deposit comes to any of my public addresses no one can tell who that address belongs to. It’s when I sell bitcoin then the information can be traced, but when I sell, I sweep the entire wallet and I am done with the private WIF and the address forever. I rarely sell. It’s such small amounts that no one will come knocking.
” but if the NSA/CIA can read every text, foreign cable, tap trans Atlantic fiber networks, don’t you think they could trash crypto currency w/o much effort? ”
A confident No.
Is Bitcoin backed by anything other than its equivalent dollars? For example, can you trade Bitcoin for gold, or silver, or The Full Faith of Credit of X Entity, without going through dollars (or euro or yen etc) along the way? Even if the government doesn’t trash Bitcoin directly, I don’t see how it can support itself for long.
I was surprised to hear that Dell accepts Bitcoin as legal tender. In that case, instead of selling physical gold to get Bitcoin to buy a Dell computer, wouldn’t it be wiser to go in the other direction? That is, use Bitcoin to buy a Dell and then sell the Dell for dollars and then use the dollars to buy physical gold. Then if Bitcoin goes south, Dell takes the hit.
Bitcoin is not backed by anything. Neither is Fiat. There is AurumCoin, just coming out any day, which is a crypto currency backed by gold (they say). How to prove it? I asked Aurumcoin how they can prove they will be backing up their coin with gold, and they were sketchy. But how would we prove if the USD was backed by gold if we return to the gold standard?
I’m suspicious of any claim by any medium of exchange to be backed up by anything. Which is why I buy physical gold.
I told you about JM Bullion. You can directly trade bitcoin for gold or silver on that web site without going through any fiat.
Bitcoin is designed to have limited amount of production. In fact this year is the “big halving.” It’s going to be twice as hard for the miners to mine bitcoin than before July. The algorithm is design that way. It’s all open source. You can detect if anyone messed with it on your full node. It’s all anarchy, controlled by no one.
A Dell computer depreciates some. Gold and bitcoin last a lot longer. That is why I’d go the direction of bitcoin to Dell or gold to bitcoin to Dell.
Oh, right, forgot about the Bitcoin mining. OK. But Bitcoin is only as good as our power plants. I suppose you could run the servers with solar panels…
Once again the EMP argument.
If there is a EMP over the USA 95% of us Americans will have far worse things to worry about than loss of bitcoin.
In addition, full nodes are all over the world. Not all the nodes will be out of operation. I have a full bitcoin node myself. I have the history of all the transactions on the blockchain as of yesterday, including Satoshi’s original transactions.
Finally, many smart people keep cold wallets - wallets stored on paper in their fireproof safe deposit boxes or other secret locations. I do that. So what if we have a EMP and no bitcoin transaction for a few weeks? I got precious metals.
And when the COMEX fails to deliver (being levered more than 300 to one with actual, on hand physical gold stocks)
How can delivery ever fail on the COMEX? Did you miss the announcement when they changed the rules to settles-in-cash, with stand-for-delivery no longer being an option?
Did you miss the announcement when they changed the rules to settles-in-cash, with stand-for-delivery no longer being an option?
Hmm, I went looking for the specifics, and couldn’t find it; I could swear there was an announcement along those lines during the GFC, but it is possible that I am remembering some misinformation, such as this:
The contract details, including settlement procedure, is here:
http://www.cmegroup.com/trading/metals/precious/gold_contractSpecs_futures.html
Delivery Rulebook is here:
http://www.cmegroup.com/rulebook/NYMEX/1a/113.pdf
Possible sound of settlement confusion, as regards EFP transactions, is here:
http://kiddynamitesworld.com/no-gld-shares-may-not-be-used-to-settle-comex-contracts/
Looks like I posted misinformation, as things stand today. Apologies for that.
The Fed’s debasement of the currency is causing a massive rush into the safe haven of precious metals, as Bill & I have long predicted.
http://www.zerohedge.com/news/2016-05-02/gold-surges-jan-2015-highs-tops-1300-dollar-extends-slide
I should have stacked more @ $1045/oz back in December….foolish. It’s been up and down and slowly stabilizing at $1300/oz now after testing $1200-$1250 through March.
What’s funny is the investors are climbing into Gold ETFs, lol, paper gold. Could you imagine ancient Egyptian tombs covered in pieces of paper? Ya me neither.
Anything but debt or depreciating assets is a net positive.
Still sitting on my pile acquired at 650. It was a long ride down from the peak though…
Wow, $650. I wish I had the resources to purchase more in the drop off( just getting career going).
I think more shocking than gold has been the instantaneous rise of Silver. I mean literally over a 2 week period it seems to have gone from $15/oz to now stable at near $18/oz. Since I’ve watched/bought PMs I don’t think I’ve witnessed such a rapid rise in silver.
Your pile had no value until cashed in.
If your pile is a doubtful 100 ounces, you get $40,000 or less, net… Of the cash you disdain.
Now what?
You have 4 months wages (a guess if you can sit on 100 ounces)
so what?
And if your pile is a far far far more likely 10 ounces, you’d have done better net wise picking yard sales and selli g on ebay.
By that logic, cash has no value until you spend it.
It broached $1300 this morning, which is significant. It can stay at this price for two years or move above $1400 but in either case, it will break its long term down trend. It is an 8% gain that it needs.
$1400 is the key.
I said all along the last few years while my bro PB was chortling, that precious metals are cyclic and all fiat money dies. The fundamentals for the debt collapse are getting closer. The boomers are dying off and retiring and downsizing and collecting social security and Medicare, presenting huge explosion in government spending while tax revenues won’t be able to keep up. The oldest boomers are 70. In ten years most of the boomers will be collecting entitlements. I will be in line, making damn sure I am a big drain on taxpayer money as well. You young people better be stacking gold because your electronic accounts -401ks, IRAs, savings and brokerage accounts will be tapped so fast by the government that there is nothing you can do to prevent the theft of your money. But your physical metals and crypto currency is out of their reach unless they send SWAT door to door. At that point we’d be in a bloody revolution anyway.
Might be a good idea to stash physical gold in a Faraday cage.
who knows how good detection will be if it comes to that ?
You know its a sad world when that is an honest consideration in people’s minds. That and sinking a certain chest/vault in a lake.
The Oligopoly’s latest screw-job against Ameircan workers may be in trouble.
http://www.independent.co.uk/news/world/europe/ttip-leak-could-spell-the-end-of-controversial-trade-deal-say-campaigners-a7009896.html
Yankee blue eyes pimping EU consumer freedom. Hehe.
Minimum wage causing major (Job) loss (California)
O C Register | May 1 2016 12:00 AM | Andy Puzder
California recently became the first state to enact a $15 minimum wage, and the business community is stunned. Not by unions pursuing such an increase. They had a $15 initiative on the ballot this November in any event. Rather, the surprise was that California’s lawmakers were so anxious to avoid a popular vote on a measure that significantly reduces opportunities for working class Californians, the very individuals it was supposed to benefit.
In December, The Federal Reserve Bank of San Francisco released a paper examining the current research on the impact of minimum wage increases. It stressed that the “most important” policy consideration was whether there would be “fewer jobs for the least skilled workers” because “they are the ones the minimum wage is intended to help.” It found that the “most credible” research showed minimum wage increases resulting in “job losses” for these workers and “with possibly larger adverse effects than earlier research suggested.”
In January of this year, Gov. Jerry Brown agreed, stating that raising “the minimum wage too much” would put “a lot of poor people out of work.” His conclusion: “There won’t be a lot of jobs.”
According to the Bureau of Labor Statistics, restaurant sector employees work an average of 26 hours per week. Increasing California’s minimum wage from $10 an hour to $15 for such an employee results in an annual cost increase of $6,760, or more than double what the employee contributed to the business’ success – resulting in a loss of $3,610 per employee per year.
So, Gov. Brown was right, “there won’t be a lot of jobs.” Marginally profitable businesses will close and fewer new businesses will open. Businesses that can move out of state will move. To survive, more profitable businesses will have to reduce workers’ hours to the bare minimum, automate as many positions as possible and raise prices as high as the market will bear. This will be particularly devastating for working class Californians in counties still experiencing high unemployment such as Fresno (10.6 percent), Kern (11.6 percent) and Merced (12.5 percent).
So why pass this bill? Gov. Brown’s office will tell you that he negotiated concessions from the unions that were not in the ballot initiative. But, it’s unlikely the initiative would have passed. After months of widely publicized union-sponsored protests, the business community had yet to even make its case and public support was only 46 percent. Passing the bill without a popular vote avoided the risk of a loss in left-leaning California that would have had national implications for the initiative’s main sponsor, the Service Employees International Union, a major source of campaign financing for Democrats.
While I’m generally in favor of higher minimum wages, California is too large and economically diverse for this one-size-fits-all approach. They should have created a minimum wage algorithm that set an appropriate wage for each county based on the cost of living. Earning $15/hour puts you in the top 10% of some desolate high desert communities.
Establishing minimum wages scales is simply price fixing. Price fixing destroys the economy.
see Greece and venz for results
Will probably be a boon for the illegal farm labor contractors… if they can get people over.
Interesting that the Fed, the BLS, and Jerry Brown are reliable sources when you agree with them, corrupt lying tools of the PTB when you don’t.
How does that work?
A vital fact that the article above omits is that the $5 increase is being phased in over the next six years….
http://www.nytimes.com/2016/03/29/business/economy/15-hour-minimum-wage-in-california-plan-has-some-worried.html
No no… the world has already come to an end!
Long term democrat rule + powerful public unions + huge FSA = bankruptcy, ruin and misery.
————
Puerto Rico Says Will Default Tomorrow, Begs Congress For Help “Or Else Crisis Will Get Worse”
Zerohedge | 5-1-2016 | Durden
Update: PR Governor Padilla has spoken…
-PUERTO RICO GOVERNOR SAYS WON’T PAY DEBT TOMORROW -PUERTO RICO GOVERNOR SAYS ISLAND WON’T PAY DEBT MONDAY -PUERTO RICO GOVERNOR: GOVERNMENT SIGNED MORATORIUM BILL YESTERDAY -PUERTO RICO NEEDS DEAL W/ CREDITORS AND/OR CONGRESS: GARCIA
And of course, demands a bailout… -PUERTO RICO GOVERNOR CALLS ON U.S. CONGRESS, PAUL RYAN FOR HELP
And then threatens…
-CRISIS WILL GET WORSE IF U.S. CONGRESS DOESN’T HELP: GARCIA -PUERTO RICO GOVERNOR CONCLUDES REMARKS TO COMMONWEALTH
A default on the $422 million due today is “virtually certain,” S&P Global Ratings said April 11.
The gruesome stiffs of the Oligopoly media-entertainment complex manage to lose $3 million on a “charity” gala for the Met. Time to step up, taxpayers.
http://www.showbiz411.com/2016/05/02/anna-wintours-swanky-met-ball-loses-3-million-catering-to-all-those-celebrities
Venezuelans voted for socialism. They got socialism. The takers overwhelmed the productive, and printing more trillions couldn’t revive a flagging economy or force producers to produce when the fruits of their labors were taken from them by force. America, meet your future under our permanent Democrat Supermajority.
http://www.businessinsider.com/venezuela-economic-food-crisis-meals-2016-4
Don’t worry - increasing the minimum wage will solve this.
To try to shore up wages, Maduro on Sunday announced a 30% minimum-wage increase, which comes after a 25% hike on March 1 and is the 33rd wage boost since 1999. Beginning this month, workers and pensioners will earn 15,051 bolivars a month — only about $13, based on the black-market conversion rate, according to El País.
The German sheeple voted for globalism. They got globalism, along with 1.1 million uninvited asylum seekers/benefits claimants. Now they seem to be having buyers’ remorse.
http://www.zerohedge.com/news/2016-05-01/get-out-traitor-german-justice-minister-flees-armored-mercedes-after-angry-protester
Goldman Sachs, which has a long and sordid history of telling the retail muppets to do one thing while it secretly bets against them, recommended that the idiots who follow its recommendations short gold in late February. Now that gold is surging, it looks like Goldman has succeeded yet again in separating the muppets from their money.
http://www.marketwatch.com/story/why-goldmans-commodity-chief-wants-investors-to-bet-against-gold-2016-04-05
I remember reading that GS recommendation—-and ignoring it.
Anyone who thinks GS has the best interests of the American investing public at heart is a fool, just as anyone who thought a candidate backed by GS and George Soros would bring “change we can believe in” is a drooling retard.
It is going to be a thing of beauty when all these Democrat apparatchiks masquerading as teachers get to retirement age and realize the corrupt, incompetent Democrats they helped install in office ripped them off, too.
http://www.detroitnews.com/story/news/local/detroit-city/2016/04/30/union-chief-dps-pay-employees-june/83756218/
A preview of coming attactions once our permanent Democrat Supermajority regime is installed by the felons and takers.
http://www.breitbart.com/national-security/2016/05/01/venezuela-beer-producer-shuts-down/
Warren Buffett issues another warning against derivatives, aka “financial weapons of mass destruction.”
http://www.telegraph.co.uk/business/2016/05/01/warren-buffett-issues-a-fresh-warning-about-derivatives-timebomb/
ED ZACHARY! Derivatives bubble is a monster. Will likely pop around the end of August or early September. Two months prior to the election. Gonna be ugly, but because of the size of it, it will probably be the bubble pop to end all bubbles. At least for half a century, I hope.
Were you the one wishing for Buffett’s demise last week?
Freddie Mac will need more taxpayer bailouts this week, with many more to follow since Obama is pushing home “ownership” for those manifestly unable to afford it or honor their financial responsibilities.
http://www.marketwatch.com/story/freddie-mac-may-need-another-taxpayer-bailout-next-week-2016-04-29
Because I know Ben loves the sharing economy…
(nbcnews > tech > innovation)
————–
SAN FRANCISCO, California — As Americans waste more fuel and spend more time stuck in traffic than ever before, the founder of car-sharing service Getaround says her startup is leading the way towards a future that’s less reliant on owning a car.
Jessica Scorpio, 29, started Getaround so drivers could share their personal cars when they’re not in use — making the owner extra cash while reducing the number of cars on the road.
————–
IIUC, this is more like AirBNB than Uber. This time they are disrupting car rental companies. I’m not sure how you would handle the logistics of handing over keys.
One commenter made a good point. This is not reducing the number of cars on the road. If I lend my car via Getaround, my car is still on the road, still sitting causing traffic jams. It’s just someone else driving it. This is only reduces the number of cars *made.*
Let some stranger use my car? Liability? Who comes to fix it if it breaks down? Who pays if the stranger tears it up?
I’m reminded of the Seinfeld episode where the parking lot attendant is allowing hookers to use customers cars to turn tricks.
Seriously though, this is the dumbest sounding start-up ever. I hope she’s got a good legal dept, since this thing sounds like it’s primed for lawsuits.
Could me a money maker.
As I found when I rented a car in London recently. At turn in, they inspected the car with a magnifying glass. They “found” a small scratch not on the rental inspection. Cost me L400 ($600).
I had this happen a few years ago when I was in Mexico. In my case, it was clearly a scam. They know that travelers returning cars are rushing to catch a flight and that most won’t argue for very long before authorizing the additional charges. I refused. I used my phone to take many pictures of the condition of that car. I took pictures of me handing them the keys. Then I reminded them that I made the reservation using American Express, which would 100% side with me when I disputed the charge, in which case they not only would not get the additional charge they were trying to scam, but they also would not get the rental fee. They quickly fixed the bill, I paid it, and that was the last of that.
Probably helps with parking a bit though… fewer people need to own cars.
Isn’t it more cars on the roads? My car sits in parking lot while I am at work or home. If it’s out making money, it is adding to the traffic not reducing.
And do they walk to the car’s location and then park it back, then walk back to wherever they came from? It sounds like a dumb version of Zipcar. As a matter of fact, this is the exact premise of Zipcar, except I’m sure it’s done much cheaper because there is no insurances or liabilities baked in.
And do they walk to the car’s location and then park it back, then walk back to wherever they came from?
No I have a business plan for that.
My company will hire tons of so called “valet parkers.” they will be part time and sit on every city corner and receive cars from customers. They will also move or drive the cars to next location where there’s a demand.
“There’s an app for that!” Haha. Seriously do people think they are being creative anymore? Uber makes sense, it disrupts the Taxi operation which is heavily regulated. AirBnB, same thing, hotels, like airlines, can charge an arm and a leg during peak times or popular destinations, AirBnB can offer an alternative.
This car rental stuff, just doesn’t make sense. Zipcar is well established and accomplishes this. In major cities they can be pretty abundant. I have used them, they are not cheap, but it satisfies the quick trip requirement for city residents with no vehicle. And who wants to loan their car to some stranger for a quick trip, for the sake of say, $30?
They will also move or drive the cars to next location where there’s a demand.
There’s a self-driving car for that. As long as it’s not snowing.
Should have read the user’s comment before replying.
“Isn’t it more cars on the roads? My car sits in parking lot while I am at work or home. If it’s out making money, it is adding to the traffic not reducing.”
No worries. You bring up a good point.
The news story thinks that this app will take cars off the roads. False.
The comment said that this app will *not* reduce cars on the road. Meaning the numbers of cars will either be neutral or go up.
You’re saying that the app will *increase* the number of cars on the road. I think you’re right, because the customer will be using a car instead of taking the bus or a taxi or Uber, or walking/biking.
“One commenter made a good point. This is not reducing the number of cars on the road. If I lend my car via Getaround, my car is still on the road, still sitting causing traffic jams. It’s just someone else driving it. This is only reduces the number of cars *made.*”
In fact, it might even increase the number of cars on the road. If I don’t have a car, but want to get somewhere, I explore other forms of transportation. If I can simply (and easily) rent someone else’s car, well, that’s one more car on the road.
Falls Church, VA Housing Affordability Surges As Prices Crater 6% YoY
http://www.zillow.com/falls-church-va/home-values/
Median price per square foot is still high, which means, not a good deal.
$/sqft fell 7% YoY too. That’s a very good sign but also a very long way to fall to get to the bottom.
How do you derive your conclusion? From the link you posted, prices have risen 0.3% Y-O-Y?
Elucidate please.
No. They fell 6%.
“In the fourth quarter of 2015, the report notes, California refinancings accounted for 42 percent of the $7.6 billion of equity ‘extracted.’ The equity-mining home owners in California averaged a $98,000 cash-out. Typical cash-outs elsewhere were about $60,000.”
Today’s wealthy housing market ATM machine cashout refinancer, tomorrow’s underwater cash-strapped housing market victim.
As they look to everyone else with puppy dog eyes, just one or two years after they yanked out $75-100k in equity. Then when their Portland, Denver, and Austin secondary home (equity downpayment) values go down, they are doubled screwed. They didn’t think twice when they gouged renters all that time however, the same renters who’s taxes will go up to bailout these money grubbers.
Who in their right mind is going to buy US debt, when Yellen the Felon clearly intends to print it all away?
http://www.marketwatch.com/investing/Bond/TMUBMUSD10Y?countrycode=BX
Better to be in US treasuries than Puerto Rico government bonds….
Who in their right mind is going to buy US debt”
The FED who else ?
‘We’ve had houses that we put in an offer and there are 24 other offers ??
Plummeting demand and not a buyer in sight….
‘Gladu was interested in sold for $224,000 a year ago. Now, it’s worth over $100,000 more. But she and her husband say it’s worth it.’
Yeah, and 50% flips in a year are no cause for worry.
Hey those new SS appliances cost a cool $4,000. Add in the pergo flooring, and its easy to see how it gained $100,000. Lol. /sarc
Don’t forget the $5k 30-year old toilet.
My grandmother just gave away her old beautiful porcelain tub (bathroom remodel). I said if they could truck that thing to Massachusetts, some idiot young couple with vested stock options or daddy’s inheritance would have bought it for their “chic” bathroom overhaul for thousands $$. But she wanted to help someone in their community more. Hah.
You can pick them up at the landfill for nothing.
Mom says quit digging in the trash.
Don’t be a Lola.
and 50% flips in a year are no cause for worry ??
There is plenty to worry about..These type of increases hit a wall and fall back…Juts like they hit a floor in 2010 and bounced up…We have seen it before and will see it again…
The facts are that in many parts of the country the “demand” exceeds the supply and therefore you get the distorted sales data…
When interest rates increase, and they will, we will see all this multiple offer environment go away IMO…Either rates or a black swan…Either would have a significant to dramatic impact on the real estate market and the overall economy…
‘Portland rent increases are slowing as more new apartment buildings are completed. But the increases are still the highest in the country, according to the biannual Apartment Report released by Multifamily NW. The small decline corresponds to a slight increase in the rental vacancy rate in Portland from 2.9 percent last fall to 3.5 percent.’
‘The new apartment construction does little to ease the burden on low-income renters because they cannot afford them. In fact, according to Norris Stevens brokerage firm, the new apartments have not kept pace with all the additional people moving to Portland. As a result, rents have risen in older inner city apartments as well, forcing their lower-income tenants out.’
“Over the last 3 years, property owners have benefited from one of the most aggressive cycles of rent increases we have seen due to tremendous increases in demand for apartments,” Norris Stevens wrote in its Spring 2016 newsletter. “As Oregon and Washington emerges from the economic recession, central neighborhoods have become “magnets for growth.” This has forced lower income renters into lower quality and older construction, as their previous residence have been sold and upgraded, and rents increased far beyond the average renter’s ability to pay.”
Note the initial FB in the Massachusetts article cites unpaid rents as why he defaulted on his mortgage.
‘Large real estate investment trusts (REITs) have made no secret of the fact that high prices and less favorable costs of capital are constraining their dealmaking activity in senior housing. This lack of REIT action may be largely behind a marked slowdown in senior housing transactions that occurred in the first quarter of 2016, preliminary figures suggest.’
‘Specifically, public companies accounted for $646 million in deals in the first quarter of this year. That’s down 67% from $2 billion in the preceding quarter, and down nearly 80% year-over-year.’
Oh dear…
“all the additional people moving to Portland.”
There was a marked slowdown in newbs during the RE downturn 5 years ago, at least it felt that way. Now, “everyone” wants to live here again. Mostly millenials who can’t stand to be left out of whatever they’ve been led to believe Portland is by the marketing team.
My friends in Portland (born/raised) are getting more and more annoyed by the growing # of CA plates filling up parking lots and neighborhoods. Parts of town are losing their charm as more high dollar apartments go up and boutique beer bars. I loved my time spent out there for a long term project, but I could see how it loses its identity as people move in and try to make it like the places they left behind.
CA is emptying and its no wonder why.
See also: millennials moving to Denver.
There are too many “craft breweries” selling $7 beers. Just because you make your own beer doesn’t mean that it’s any good. Half of these places need to go out of business already.
I was in downtown Denver on Saturday night (a rarity for me) on Blake Street near Coors Field and everybody downtown was really really really white.
Are they charging that much now? There is a line of thought among some in the craft beer industry that beer can be like wine. Really expensive, people will age it and collect it. They are making a big mistake IMO. Beer is for working people and should be inexpensive. Most of it is best when fresh. Go ahead, be like red wine, which has been over-planted and now they are drowning in it.
I am a beer geek myself, and I cant count the times I’ve checked out a brewery only to let a resounding “Meh” after trying a couple offerings. It’s a hugely oversaturated market these days, everyone thinks its time to open a brewery. The time was 6-8 yrs ago. People forget there was a craft beer bubble in the 90s, and a lot of breweries went bust. Some of the big craft brewers today got their start with the consignment/bankruptcy purchases of the used fermenters, wort vats, and other gear of failed breweries.
As you say, just because you can brew your own beer, doesn’t make it good.
“Beer is for working people and should be inexpensive.”
You mean used 30 year old toilets shouldn’t be $5k? A barely functioning “porcelain” replica tub shouldn’t be $10k?
Beer is for working people and should be inexpensive.
There’s always Natty Light.
And for the working people who have “arrived,” there’s Carlo Rossi.
Donk,
They’re failing businesses founded on grossly inflated prices and borrowed money.
Ska Brewing out of Durango, CO is some of the best I’ve tasted here.
The only one from Denver I can recommend is Comrade Brewing.
Left Hand and Avery are good, but neither are in Denver.
“The facts are that in many parts of the country the “demand” exceeds the supply”
Not true.
US Housing Demand Plummets To 20 Year Low
http://2.bp.blogspot.com/-yX5B5Hn95bQ/VYC3Wr6ihBI/AAAAAAAAj7I/alOslZa-cK8/s1600/MBAJune172015.PNG
‘attempting to sell it or have it taken into foreclosure was a ‘business decision’
‘Cadime said he bought the property in 2005 at the height of the housing market, and then it ‘crashed in 2008.’ There has also been a large reduction in rents that landlords charge compared to the time he purchased the properties, Cadime said, and he said the rental demand in the city is lower. ‘You’ve got to make a decision and not hold onto an investment that isn’t working,’ Cadime said.’
This is interesting. The guy held on during the crash, but now he just stopped making payments. He must have thought he would be back in the black but has given up. And his fellow city counsel man did the same thing. I wonder if there are a few more like them out there? And aren’t rents going to the moon?
‘Currently, there are more than 8,000 new units of housing in construction in Boston, representing more construction employment in the housing sector than at any time in the last 20 years, the report said.’
‘Also, completions are now exceeding projected population growth: in the last year, enough housing came on line to house 5,900 people, while the Metropolitan Area Planning Council’s projection for population growth is 4,590 people per year.’
I have no idea who is renting them. Since 2014 I have witnessed at least 3 residential buildings/towers in the gentrified/reclaimed “Seaport District”, and at least 4 or 5 in the north part of the city. $4000-$6000/mo rents or of course Millions of $$ to purchase. Most of the people I’ve met that try to make it in the city in finance or other business jobs are earning typical incomes ($60-90k). Are there that many foreigners??
‘The first quarter of 2016, however, saw only a bulk purchase market share of 2.5 percent. Market-wide, bulk purchases came with a 19 percent price discount in South Florida during the first quarter’
So 97.5% of buyers are instantly underwater.
“bulk purchase market”
Banks trading 25 million excess empty and defaulted houses back and forth.
$320,000 includes the bars on the windows:
https://www.redfin.com/CO/Englewood/3039-S-Bannock-St-80110/home/34635469
I recognize the name Englewood from Ice Cube’s “Ghettobird” song.
That’s Inglewood, CA. Englewood is South Denver, which the developers of a new apartment complex in Englewood have branded as Cherry Hills. Englewood = crack shacks, and Cherry Hills = million dollar mansions.
Here’s the slick website for the millennials:
http://www.altacherryhills.com/
I shop at the King Soopers near there, being close to the light rail station and transfer points for several bus lines this neighborhood is overrun with junkies and drunks and panhandlers.
Lots of Spanish speaking fats with neck tattoos there too.
Man o man - how times have changed - My h.s. English teacher used to live in that immediate area and though very kinda working class it was a decent nabe. And here we are 40 years later and you are describing this? ugh!
Re: the house on south Bannock - THAT was my old stompin grounds with my h.s. buddies way back when - good peeps with good values - hard workin folk who were just makin a go of it. That nabe - near Craig Hospital - a place I am familiar with.
I’ve been to some shows at the Gothic Theatre on South Broadway. I don’t spend much time in Washington Park. I look at asking prices for houses in 80210, 80110, 80113 and I’m not impressed with what I see.
I guarantee the people that live there look nothing like the folks featured on that slick website. I live in an apartment complex managed by that same company, and the people who live here don’t look like the wine-sipping upper-class people lounging around the pool on our website either. They’re suckering in out-of-staters moving to the area who have no idea.
whitey causes prices to skyrocket
And the unspoken parallel to that statement:
_______ causes prices to plummet.
You can fill in the black, er, blank, yourself.
That would be a lovely cottage or second home… in the country for 1/3 the price.
‘Ultra Petroleum Corp. filed for bankruptcy protection, the latest oil and gas explorer to fall victim to the prolonged slump in energy prices. Ultra listed $1.3 billion in assets and $3.9 billion in debt in court papers filed in Houston on Friday. The Houston-based company has 159 employees and its main assets are gas-producing properties in Wyoming, as well as some assets in Pennsylvania and crude oil properties in Utah, according to court papers.’
‘Between March and early April, Ultra missed a series of principal and interest payments owed to lenders and bondholders. And on April 14, the company was sued by pipeline operator Sempra Rockies Marketing LLC for failing to pay transport fees.’
‘Much of the problem can be traced to a record-breaking surge in U.S. oil production that wouldn’t have been possible without a tremendous amount of debt. Many independent drillers, the small producers that drove the shale boom, outspent cash flow even when oil was $100 a barrel, and made up the difference with bank loans and high-yield bonds.’
And Sempra can’t pay its bills, and on it goes. Two things: 1. heck of a job Janet. 2. the importance of making money rears it’s head again.
Cover your eyes rental watch:
‘Why, exactly, is it so darn hard to find an affordable home in Bozeman? There’s no single answer, certainly, but a key part of the puzzle is that the price of land is, well, too high. As the area’s housing market has recovered from the Great Recession — pushing median home prices to record highs — the cost of infrastructure-equipped land suitable for building has risen accordingly, with a median lot going for $84,500 last year, according to numbers from the Gallatin Association of Realtors.’
‘While Bozeman-area land prices, unlike finished homes, still haven’t surpassed their housing bubble-era peak, they’ve risen substantially in recent years. According to GAR, the median price of lots in Gallatin County increased $35,486, or 72 percent between 2012 and 2015.’
‘For builders aiming to hit the $192,000 housing price point the city considers affordable for buyers making $66,780 a year, an $84,000 lot means 43 percent of the target price is sunk into acreage. That puts a significant cramp on the remainder of the project budget.’
There isn’t a SFR building lot on the the plant worth more than $10k.
May 11, 2015
“The cost of building homes is always on the rise. But never is the increase more apparent than during a strong rebound and growth period like parts of Montana — and the rest of the country — are experiencing now. Statistics from the U.S. Census Bureau show Montana building permits for single- and multi-family homes in March were up 75 percent over last year. Lot prices in and around Bozeman are still cheaper than they were in 2007, but they’ve nearly doubled from three years ago, said Brian Popiel, chairman of the Southwest Montana Building Industry Association.”
“Though Bozeman hardly has a glut of houses overall, the current boom in the larger homes market may lead to a time when there are too many homes that Bozemanites can’t afford, Popiel said. ‘Everything I’m seeing points me to (the notion) that we would get a glut of houses in the $350,000-$450,000 range,’ he said. ‘That takes a pretty sizable paycheck to get there. And Bozeman doesn’t have that many of those jobs.’”
http://thehousingbubbleblog.com/?p=9009
July 23, 2015
“A glossy sign, erected at the side of a Mendenhall Street parking lot in downtown Bozeman, announces progress. Breaking ground in August, it proclaims, is the next in a steady drumbeat of major construction projects coming to the city’s core: the ‘5 West’ development, a five-story, mixed-use building slated to provide retail, office and residential space on the site of what is now Opportunity Bank.”
“But the 5 West sign, complete with its architectural rendering and ‘Live | Work | Play’ slogan, has been marred by an anonymous dissenter. Added to its contents — if it hasn’t yet been cleaned up — is an asterisk, and a message scrawled in black marker: ‘Trust fund not included.’”
“The 5 West project is set to include condos tentatively priced from about $285,000 to $750,000, on par at the lower end with much of the Bozeman real estate market. For comparison, figures from the Gallatin Association of Realtors put the city’s median single-family home price at $369,000 and rising. One of the downtown area’s key planning documents, its 2009 Downtown Bozeman Improvement Plan points to three ‘key urban residential markets’ for Bozeman’s core — singles and young couples in their 20s and 30s, ‘downsizing’ baby boomers and, of perhaps most note to trust fund alarmists, buyers seeking second or vacation homes.”
“Referencing a University of Montana study, it notes that the latter group tends to be ‘relatively wealthy,’ with average annual incomes around $100,000. In contrast, according to the Bureau of Labor Statistics for the last three months of 2014, the average Gallatin County worker makes $760 a week, equivalent to $39,520 a year. Additionally, wages in some major Bozeman sectors are considerably lower than the overall average. The retail trade industry, which employed 17 percent of Gallatin County workers in October, averaged an annual wage of $29,600. Accommodation and food service workers, 15 percent of the workforce, were paid even less — $17,472 on average.”
“Entering the $39,520 income figure into a realtor.com home affordability calculator (and assuming a 20-year mortgage, 4.2 percent interest rate and $30,000 down payment) provides a $144,900 purchasing power estimate for the county-average individual wage earner — more than $100,000 less than the minimum price for a 5 West unit. And, for a single-income household able to put away 10 percent of its income, saving up to that $30,000 down payment would take seven-and-a-half years.”
http://thehousingbubbleblog.com/?p=9143
November 18, 2015
“Affordable housing — perhaps the single most fraught issue facing Bozeman — will be back in front of the city’s five commissioners Monday. Southwest Montana Building Industry Association chairman Brian Popiel said the building industry remains adamantly opposed to the mandatory portion of the proposal, which would kick in automatically if affordable home production falls short. As Popiel puts it, the policy relies on the assumption that builders are ‘greedy bastards selling homes at inflated prices.’ That’s ‘fundamentally misguided,’ he said.”
“The city’s housing consultant, Daniel Werwath, disagrees with the notion the construction industry is running on thin margins, however. Werwath argues Bozeman’s housing market has been distorted by ‘unnatural demand’ fueled by outside money, as retirees and others relocate to the area having sold homes in pricier markets or built savings in communities with higher wages. ‘Houses are not priced at the cost to build them,’ he said. ‘Houses are priced at what the market will pay. People are making good profits right now,’ he said. ‘People could be building lower-cost housing in Bozeman.’”
http://thehousingbubbleblog.com/?p=9354
Montana….. where social security dollars and people go to dry up and die.
” the cost of infrastructure-equipped land suitable for building has risen accordingly, with a median lot going for $84,500 last year”
They are talking about land that has some level of infrastructure provided to it, not just raw land (which is an input to a lot).
Why are lot prices going up?
“What’s behind the rise? Much of it, real estate observers say, comes down to basic economics — even as the housing market has rebounded in force, the number of new lots being created in Bozeman-area subdivisions has stayed comparatively modest relative to the pre-recession boom.
While a whopping 1,730 lots received final plat approval from either Bozeman or Gallatin County back in 2006 — a number that dipped as low as 20 a year at the depth of the recession — annual production in 2015 was 690.”
and
“Popiel said he estimates the city is currently adding only a quarter of a home lot per new resident, compared to half a lot in the 2000s and nearly a full lot per new arrival back in the ’90s.”
and
“both Popiel and Erlenbush said it’s unclear that there are enough subdivisions in the development pipeline to supply the rapidly growing city with home sites proportionate with population growth in the coming years — a supply constraint that could push lot prices up even higher.”
More guessing from Rental_Fraud.
And what is “infrastructure”?
“Part of the issue, several planners and building professionals said, is that it’s often harder to secure financing for large development projects in the post-Great Recession world. The cost of infrastructure like streets, water supply and sewer service is also a constraint to some extent, they said.
Thomas, for example, noted the city is currently working on projects to expand sewer capacity to make more development possible south of the Montana State University campus and on the city’s western fringe.”
Infrastructure, you know, utilities (sewer/water, power), as well as roads/curbs, etc.
A house. Not a development.
Septic system- $6k
Drilled well- $5k-12k
What roads? What curbs?
You idiot Mr. Gorilla. Can’t put septic in a city. You have to pay for road, curb, sidewalk, mailbox, streetlight, mow strip also.
Also can’t drill well in a city.
Go back to the zoo please.
Can’t put development in a city. Remember? Theres no room.
*THINK* my friend.
Comment by palmetto
2016-05-01 09:57:50
“Which one of us is more likely the sucker?”
If you don’t know who it is, it’s probably you.
BTW, no one ever seems to mention over-population. Too many people. Way, way too many people.
Strange thought for the day: “too many people” is a form of carbon sequestration.
Wellington, FL Affordability Improves On Plunging Housing Demand; Prices Crater 5% YoY
http://www.zillow.com/wellington-fl/home-values/
Series I bond new rates are out today. I loaded up on the bonds issued in April before the new rates. There is a blogger who is very accurate in his predictions on new rates. He crunches the numbers of the CPI-U and bases his prediction for the new rates, posting them the previous month, so that you can decide if it’s worth buying before the new rates come out or after. He hit 100% this time.
I loaded up on series I bonds in April. The one year rate good for the next six months is 1.64, while the new rates for the next six months is 0.26. So by buying last month I get 0.84 plus 0.13, which is 0.97 for the year on the I bonds I purchased. If I waited, I would be getting (0.26 plus whatever new rate in November)/2.
0.97% is much better than the rate I get on 52-week bills.
Remember when it was no-brainer and no math to put money in a simple savings account for 5.25%
I wished I could have been around in those times. It’s crazy to see my credit union offering barely 1% interest on MMA/Jumbo MMA ($100,000+). 1 stinkn % to have $100k sitting there?
Better that than $0 to your name and a mountain of debt and a depreciating shack.
Heck I think I read on a money/news site that having $5,000 to your name and no debt puts you in a better position than 50% of Americans.
“Heck I think I read on a money/news site that having $5,000 to your name and no debt puts you in a better position than 50% of Americans.”
Imagine an annual gain of your current compensation (plus inflation rate) at the time you retire, without social security or medicare factored in.
I used to stop at Starbucks on Torrance blvd near Hawthorne blvd in the South Bay on the way to work and there were a group of guys gossiping every morning, while having burnt coffee and getting refills. Imagine getting paid by your investments to just go hiking in Colorado every day or biking, then chit chat with a bunch of old cronies after the morning hike or morning bike. Then have the whole day ahead of you to putter around, replacing your late model car with another car every four years or so. Why not.
The conundrum is that while there were 5.25% yields, stocks were going gangbusters. 2003 through 2007, and the 1990s. People thought you were nuts to be in money market accounts when there were asset classes with greater annual gains at the same time.
This is why you have to diversify and expect those situations to reverse several times during your career.
I get 1% on my savings account. Why bother with bonds?
No state income tax on savings bond income.
Berkeley, CA Housing Prices Fall; Inventory Balloons As Housing Demand Plummets
http://www.zillow.com/berkeley-ca/home-values/
‘Investors may be salivating for a piece of Saudi Aramco when the kingdom of Saudi Arabia sells a small chunk of its gigantic state-owned oil company, probably in 2017. But potential buyers ought to beware.’
“I think they’re hedging the uncertainty that their oil is going to be worth less,” Matthew Weatherly-White, founder of the Caprock Group, tells me in the video above. “Even more dramatically, there might be stranded carbon assets they own, and by that I mean assets that are simply worth nothing.”
Interesting. I knew houses can and do go negative but no idea oil could be so worthless.
Who wouldn’t want to invest in a company that:
1. Could be nationalized at any time (like its parent company)
2. Will be stuffed full of all the poor performing assets of the parent company and be sold at a premium
3. In a country that is on the literally edge to either go to a full scale shooting war with Iran or to become the next Syria.
4. With no way to audit or verify management’s financials
Bridgewater, NJ Housing Affordability Balloons; Housing Worth Less As Prices Crater 19% YoY
http://www.zillow.com/bridgewater-nj/home-values/
Republicans gave up the only power they have - the power of the purse.
And this is the result.
Anyone remember the obama quote how this debt was unpatriotic…?
Who would have thought that the WORST of the Bush deficits would be the “good old days” of government reigning in spending?
———–
In 6 Months Since Budget Deal: Debt Up $1 Trillion
CNS NEWS | May 2, 2016 | Terrence P Jeffery
In the six months that have passed since then-retiring House Speaker John Boehner and Senate Majority Leader Mitch McConnell cut a budget deal with President Barack Obama that suspended the legal limit on the federal debt until March 15, 2017, the federal debt has increased by just over $1 trillion.
The Senate passed “The Bipartisan Budget Act of 2015” with a vote held in the early morning hours of Friday, Oct. 30. Obama signed it on Monday, Nov. 2.
At the close business on Oct. 30, 2015, the total federal debt was $18,152,981,685,747.52. By the close of business on April 28, 2016—the latest date for which the Treasury has published the number–the total federal debt was $19,186,207,744,589.55.
That is an increase of $1,033,226,058,842.03.
On Monday, Nov. 2–the day Obama signed the Bipartisan Budget Act and thus suspended the debt limit–the debt took a big leap. It closed that day at $18,492,091,120,833.99—up $339,109,435,086.47 from its $18,152,981,685,747.52 closing on Friday, Oct. 30.
Prior to that, the part of the federal debt subject to the then-legal limit of $18,113,000,080,959.35 had been frozen just below that limit for more than seven months (from March 13, 2015 through Oct. 30, 2015), during a “debt issuance suspension period” that Treasury Secretary Jacob Lew had declared on March 13, 2015, to push back the date at which the debt limit would be exceeded.
ust text to get light bulbs changed and the landlords will even sub you £50 to have a party: Inside London’s new ‘twodios’ – the halls of residence-style communal homes for cash-strapped millennials
Residents in the 550-room 11-storey tower pay £1,100 a month for a ‘twodio’ - a private room with shared kitchen
In return they get a cleaner, linen changes and use of communal spa, library, cinema, games room and dining rooms
New residents excited about starting a new life are moving in from today - even though it’s still not finished
London’s housing crisis is said to be discouraging young professionals from moving to work in the capital
New scheme hopes to offer graduates an alternative to flat sharing as many don’t want to share with strangers
Read more: http://www.dailymail.co.uk/news/article-3569317/Just-drop-text-light-bulbs-changed-landlords-sub-50-want-party-residents-places-London-s-new-Twodios.html#ixzz47WLyDEUH
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Arcadia, CA Housing Affordability Surges As Prices Plunge 10% YoY
http://www.zillow.com/arcadia-ca/home-values/
Down down down we go. You have only one chance to get it right or lose your a$$ completely….. Ya hear?
“Construction Costs Continue to Fall Despite Commodity Price Increases”
http://www.forconstructionpros.com/news/12199957/construction-costs-continue-to-fall-despite-commodity-price-increases
UN-BE-LEEEV-ABLE…
‘Underwriting standards eased at a significant number of banks for the three-year period from 2013 through 2015,’ the report said. ‘This trend reflects broad trends similar to those experienced from 2005 through 2007, before the most recent financial crisis.’ Not since 2006, it noted, have lenders taken on so much credit risk, and it says the hazard will continue to grow this year: ‘Examiners expect the level of credit risk to increase over the next 12 months.’
‘A large chunk of the risk is coming from first-time home buyers with shaky credit and so-called ‘rebound’ buyers who previously defaulted on home loans. The demand from otherwise uncreditworthy home buyers ‘is driving home prices up faster than incomes and inflation,’ noted Edward Pinto, co-director of AEI’s International Center on Housing Risk in Washington.’
Time to watch “The Big Short” Again.
Watch it? I’m beginning to wonder where I can get in on the RE shorting action!
These are the days of our Region:
http://www.picpaste.com/20160502_122345.jpg
Region VIII
Looks like it was taken up near Loveland?
Yup. Loveland Ski Area. Day 26 on skis for me this season.
All made possible because I rent for a third of the cost of buying…
Where are the flying dogs?
“Where are the flying dogs?”
They have flying dogs in Region VIII?
Sports Authority might close over 300 stores…
http://money.cnn.com/2016/05/02/news/companies/sports-authority-sale-store-closings/index.html
Puerto Rico Defaults on 422 Million…
http://money.cnn.com/2016/05/02/investing/puerto-rico-default-may-1/index.html?iid=hp-toplead-intl
…Looks like CNN is peddling fiction.
booty wants bail for PR then IL
call your reps
NO bail !
No bail out. We’d be happy to take collateral or let you work it off.
‘The people who came and built things around here, they’re depressed. They have bills to pay. And a loan to pay. So they’re depressed,’ Rousher said.”
No matter the situation or balance people are always “depressed” when in debt.
“No End In Sight To Current Downturn - US Manufacturing Plunges To Sept 2009 Lows”
http://www.zerohedge.com/news/2016-05-02/no-end-sight-current-downturn-us-manufacturing-plunges-sept-2009-lows
Fed does a good job at destroying demand.
More debt is never the answer to life’s problems.
Will these people ever learn?
Are your worries over China’s bond market mounting?
FINANCIAL TIMES
Market Shocks
Worries mount over China’s bond market
Rising defaults, excess leverage and doubts of more monetary easing sap investor appetite
A Chinese national flag flutters against the office buildings at the Shanghai Bund shrouded by pollution and fog in Shanghai, China, Thursday, April 14, 2016. World finance officials who meet in Washington this week confront a bleak picture: Eight years after the financial crisis erupted, the global economy remains fragile and at risk of another recession.
(AP Photo/Andy Wong)
yesterday
Gabriel Wildau in Shanghai and Jennifer Hughes in Hong Kong
Two-plus years of a near-unbroken rally and a market may perhaps be forgiven for a pullback — unless that market is in China, where the sharpest monthly jump in bond yields since the rally began has prompted worries another mainland boom looks to be on borrowed time.
Concerns about a rise in defaults, excess leverage and doubts about the likelihood of more monetary easing has sapped investor appetite and overshadowed China’s massive bond market.
A series of defaults and near-defaults by state-owned enterprises (SOE) have dominated attention since SOE’s government backing had, until now, been considered a guarantee of prompt and full payment. Last month. two SOEs missed scheduled bond payments, while a third suspended trading of its notes and warned it would struggle to make a payment due this month.
Rising yields, which move inversely with price, have deterred other borrowers, with corporate issuance halving to Rmb641bn last month from its rate in March, according to data from Wind Information.
Yields on benchmark five-year government bonds rose from 2.47 per cent at the start of April to 2.8 per cent last week — a three-month high, and their sharpest one-month move since November 2013.
Crucially, the difference or risk premium between government borrowing yields and those paid by low-rated companies widened to a four-month high, illustrating growing concern of hard landing beckoning for the market.
Bankers, however, play down the risk that defaults could cause a wider panic.
“To me this is a healthy repricing that we’ve seen,” says Beng Hong Lee, head of China markets at Deutsche Bank. “Look across China and for a long time defaults have been extremely low. That has resulted in mispricing of risk and the expectations that the government or a bank will come to the rescue.”
…
‘Resuming trade after a long weekend, Japanese stocks were crushed on Monday, tumbling more than 3% following an equally ugly decline on Thursday. The benchmark Nikkei 225 finished the session down 3.11% at 16147.4, the lowest closing level seen since April 12.’
‘From the high of Thursday’s session — 17,572.3 — the index has now fallen by an amazing 8.1%. Putting that another way, in just one and a half sessions of trade, it’s nearly hit levels deemed to be a technical correction.’
‘The significant losses followed the shock decision from the Bank of Japan last week to keep monetary policy settings unchanged in April, something that was seen as unlikely by most in financial markets. “We’ve started the week with a precipitous drop in Japanese equity as the market responds to the strength of the yen,” co-managing director at Tyton Capital Advisors Martin King told Reuters. “The Bank of Japan’s decision last week not to extend easing polarized the market and at the moment the voice of the bears is louder. Many will be asking what can be done to depreciate Japan’s currency this time as the BOJ has already come close to exhausting its tool-kit.”
http://www.businessinsider.com.au/its-carnage-in-japan-with-stocks-down-more-than-8-in-less-than-one-full-session-of-trade-2016-5
Get used to bailing out corrupt, failed Democrat-maladministered basket cases, bitchez….
http://www.marketwatch.com/story/puerto-rico-misses-payment-as-debt-crisis-escalates-2016-05-02?link=MW_latest_news
Millennials, who flocked to vote for hope ‘n change without bothering to ask what a Soros-annointed candidate would do for them, are now getting a reality check as they are drowning in debt and the promised hope ‘n change has yet to materialize for anyone outside Manhattan or the Beltway. Can the zombies awaken? I guess we’ll see.
http://www.businessinsider.com/millennials-regret-student-loans-2016-4
Hope ‘n change comes to Sports Authority and its 14,500 soon-to-be-jobless employees.
http://www.breitbart.com/big-government/2016/05/02/sports-authority-files-bankruptcy-450-store-closure-leave-14500-people-jobless/
‘Murica!
http://www.theburningplatform.com/2016/05/02/murica-12/
https://patchofland.com/