Erosion In What Had Once Been A High-Flying Market
It’s Friday desk clearing time for this blogger. “According to new data released by Corelogic, a national consumer information company, homes in Grand Junction are increasing in both price and value. News Channel 5 spoke with Kris McChesney, a realtor at Bray Real Estate, who said this increase is only partly true. McChesney said like any market, housing is driven by supply and demand, and right now, the area is going through a period where inventory is low which would normally drive the price up, but there is no increase in demand. ‘In cases where you’re looking at homes and properties under $300,000 they are selling a little bit higher,’ McChesney said. ‘But, if you’re getting above that $300,000 level, the buyers out there aren’t there, even though the inventory is still low, we just don’t have the purchasers, so it’s not driving the price up.’”
“Manhattan apartment landlords, entering the prime leasing season, are boosting incentives to lure tenants as a surge of new supply gives renters more choices and the chance to bargain. Citi Habitats said that 17 percent of all new leases it brokered last month carried some form of landlord sweetener — the most for May since 2010. ‘Historically, this is the time when owners are more in control of the market,’ said Gary Malin, president of brokerage Citi Habitats. ‘The pricing that owners want is too out of reach for most. The concessions are making the market appear stronger than it actually is.’”
“The Woodlands residential real estate market has slowed as single-family home sales and list prices continue to inch downward. Home sales for the first quarter of 2016 tumbled to 341, down 14.3 percent from sales in the first quarter of 2015, with fewer pending sales, according to the Houston Association of Realtors’ MLS. And while there are fewer sales, more homes have flooded the market in the past year. In the first quarter of 2015, the median sales price for homes in The Woodlands was $356,250. For the first quarter of this year, median sales price has fallen to $318,500, which is an almost 11 percent drop year-over-year, according to HAR’s MLS. Residential lot prices were down as well.”
“The Woodlands is a buyers’ market for high-end homes, particularly those priced above $700,000. The Woodlands has 8.9 months of inventory for homes priced between $700,000 and $800,000 and up to 15 months worth of inventory for homes priced above $1 million, Realtor Brian Schweiker said of Re/Max The Woodlands and Spring’s market report for April. While the bulk of the market is homes below $1 million, those top-priced homes represented about 6 percent of home sales in the first quarter of 2016, according to HAR’s MLS. That means buyers may have more bargaining power to negotiate prices in their favor. ‘Sell when you’re ready to sell, but its more important than ever to hire a good real estate agent,’ Schweiker said.”
“Eight years after the housing bubble burst, nearly a quarter of homeowners in Keansburg and the Mystic Island section of Little Egg Harbor Township still owe more than their homes are worth, the two highest rates in Monmouth and Ocean counties, according to Zillo and analyzed by the Asbury Park Press. It leaves many homeowners there with three options, none of which are appealing: They can walk away, they can keep paying their mortgage and hope the value eventually will rebound, or they can sell it at a loss and go to the closing with a check in hand.”
“Residents told about the data said they weren’t surprised. Michael and Carmen Bednarz bought a house in Mystic Island in 2008 for $240,000. They estimate that it is worth about $170,000 now. ‘You try not to think about it,’ Michael Bednarz, 61, said. ‘You get depressed.’”
“An organizer with a pro-liquefied natural gas group in Fort St. John says he’s ‘alarmed’ by news that gas driller Progress Energy is drastically cutting spending as it awaits a decision on Pacific NorthWest LNG. The northeast real estate market is already feeling the effect of the downturn, particularly in the multiple-family rental sector. ‘The landlord party is over,’ said Kevin Kurjata with Century 21 Energy Realtyin Dawson Creek.”
“He detailed erosion in what had once been a high-flying rental market in Dawson Creek, which had posted the second-highest rental rates in the province as recently as two years ago, spurring a multi-family building boom. ‘The price of energy has plummeted and vacancy rates in Dawson Creek have skyrocketed. It used to be impossible to find a place to rent. Today, property management firms have given me vacancy estimates over 20%.’ Kurjata said he has reduced rents on older apartments he owns to around $950, down from the $2,200 range two years ago.”
“In 2012, he noted, a half-duplex on 104th Avenue in Dawson Creek sold in a month for $323,000. The adjoining, identical three-bedroom unit is now listed at $269,900 and has been on the market for 127 days ‘with no offers,’ he said.”
“Australia’s oversupply of apartments has hit 70,000, according to research. And banks are increasingly revaluing off-the-plan dwellings approaching settlement to ‘well below’ the initial purchase price, raising the risk that settlement failures will rise, investment bank JP Morgan says. That figure was ’set to rise as the record number of dwellings under construction are completed,’ said JP Morgan economist Tom Kennedy. He added a concerning development was the sharp fall in the number of unit sales relative to the number of apartments being completed — a ratio that has been falling since 2014 and is at near record lows due to oversupply and rising settlement times.”
“‘Longer settlements are a concern in their own regard, especially in an environment of falling dwelling prices,’ Mr Kennedy said. ‘Indeed, JP Morgan analysts highlight industry feedback suggesting banks are revaluing off-the-plan dwellings approaching settlement well below the initial purchase price. As a result, additional buyer equity is required to cover any shortfall between the sale price and what banks are willing to lend, increasing the risk of settlement failure.’”
“The island that was once lauded to be Phnom Penh’s biggest entertainment and residential complex was a flurry of construction activities when most of its high-end condominium projects broke ground in 2010, but some projects have run out of steam. Sovannaroth Khan, head of valuation at Independent Property Services Cambodia, noted that some initial Casa Meridian buyers are asking to sell or lease their units out as well. ‘I notice that D.I. Riviera has likely postponed its construction. The reason behind this is unclear, while the rest are keeping [on with their construction],’ said Khan, who acknowledged the high-end condo sector has now gone into oversupply.”
“The most recent UK residential market survey from RICS has already highlighted a ‘continued’ lack of confidence in the prime central London housing market. A lack of foreign investors will likely have a knock-on effect overall. The housebuilding industry, too, seems to be under pressure. At the high end, one property magnate recently admitted that the market for £2million to £10million homes had ‘collapsed’ and that Chinese speculators were ‘walking away’ from new-build flats they had agreed to buy.”
“Meanwhile, at the lower end of high-end residential property, one Surrey-based estate agent revealed that, he cannot sell ‘any house in the South East for more than £2million, for love nor money.’ All around, agents are speculating about an ‘unavoidable’ price crash.”
“Fang Tao’s hopes of striking it rich in the Chinese stock market died as his investments plunged by half over the past year. Now, he’ll be happy just breaking even. He sees no sign of the Shanghai Composite Index returning to its highs anytime soon, despite efforts by the ruling Communist Party to prop up the market. ‘The most significant change has been my mindset,’ Fang said. ‘Now I feel like when I’m not making a loss, I’m winning.’”
“Not all Chinese investors are cutting back on speculative trading, with many shifting to the property and commodities markets instead. New home values in Shenzhen have jumped 62 percent in the past year amid a real estate boom in China’s biggest cities, while prices for everything from iron ore to steel and eggs surged on the nation’s futures exchanges earlier this year, before reversing at the end of April.”
“The volatility in commodities suggests China’s individual investors still have a lot to learn, but the hope is that their casino-like mentality will fade over time, according to Steve Wang, chief China economist at Reorient Financial Markets Ltd. in Hong Kong. ‘Trees don’t grow to the sky,’ he said.”
‘Lured by hopes of easy money, amateur Chinese traders lose their shirts’
‘Chasing the promise of outsized returns, 48-year-old businessman He Xiaolun started trading oil last August on a platform developed by the Shaanxi Non-ferrous Metal Exchange. Over the next five months, he lost nearly 3 million yuan ($455,000).’
“Initially, I lost several thousand yuan,” He said. “The exchange’s trading advisor told me to put in more money, and guided me into trading more frequently.”
‘The exchange did not respond to questions from Reuters. The advisor said clients made trading decisions and it was not the exchange’s fault if they lost money. He and other investors say they were duped by online commodity trading platforms that have cropped up over the last few years in China. Some have been using internet dating sites to lure customers.’
‘By the end of 2015, annual spot commodities trading volume had reached $4.5 trillion on more than 350 independent exchanges in China, according to data from Euromonitor. But while a bout of turbulence in major commodities futures markets last month triggered a swift response from regulators against “speculation”, there remains little oversight over small regional exchanges.’
‘Despite issuing its warning last month on the risks investors faced playing such exchanges, the CSRC says it is not its job to regulate them. “It’s the local government’s responsibility,” said a CSRC official in Shaanxi, central China.’
‘Disgruntled investors and some analysts say that results in frequent conflicts of interest, as many small exchanges are backed by regional governments. “These exchanges are big tax contributors to the local government, and are thus protected by them,” said Chang Chengwei, an analyst at Hengtai Futures Co. “At the same time, they’re not supervised by CSRC. This is a regulatory loophole that puts many small individuals’ money at risk.”
‘Many small investors piled into commodities this year after an equities bubble burst, erasing more than 20 trillion yuan ($3 trillion) from China’s stock markets. Many retail investors have ended up on regional spot exchanges as commodity trading firms ratcheted up their sales pitch, with cold calls from sales representatives promising double-digit monthly returns.’
‘Online dating sites, too, have become popular venues for the hard sell by some trading firms. Users are lured into trading commodities by someone they meet on the site, thinking they are developing a personal relationship. They often end up losing tens of thousands of yuan before realizing the relationship is strictly business.’
“This has become the biggest type of scam on our site over the past year,” a top executive at a leading Chinese online dating company said. The site has teams dedicated to blocking offending accounts, but they just reappear later under a new name, he said.’
Savvy. Savvvvy!
It seems to me like a lot is falling apart at the same time.
Chinese Morality
That’s like saying military intelligence.
Or carbon free sugar.
No kidding, carbon free sugar is being marketed. How this is possible I haven’t a clue (not the marketing part but the carbon free part).
Carb or carbon? If it’s carb, they probably mean net carbs. That’s what sucralose (Splenda) is.
An example …
https://www.dominosugar.com/carbonfree/
How this is possible I haven’t a clue (not the marketing part but the carbon free part).
It’s not “carbon free”—it’s CarbonFree(tm). Big difference…
‘Chasing the promise of outsized returns, 48-year-old businessman He Xiaolun started trading oil last August on a platform developed by the Shaanxi Non-ferrous Metal Exchange. Over the next five months, he lost nearly 3 million yuan ($455,000).’
Yer better off learning hard financial lessons in your 30’s. More time to recover!
Where the hell do idiots like this get that kind of money?
“Yer better off learning hard financial lessons in your 30’s.”
There’s a billion more where he came from.
‘The air has well and truly come out of Perth’s tech bubble, with shares in four of last year’s biggest local stock market movers now sitting at historical lows as investors look elsewhere. In a trend which has been slowly building over the past six months, tech has lost its lustre with local investors now pumping risk money back into resources such as lithium.’
‘With the tech bubble now into its third year, investors have also started to question the money-making abilities of many tech plays. And traders once banking on blue sky appeal are now jumping out on any whiff of a downturn.’
‘The biggest fall comes in the form of Silicon Valley-based human resources play 1-Page. Its shares rose as high as $5.50 in September — valuing the company at about $800 million — after it backdoor-listed through the shell of Perth’s InterMet Resources in April 2014. The company yesterday hit a new 20-month low of 46¢ a share, valuing it at $70 million, after it recorded $94,000 in revenue during the March quarter against a $5 million loss.’
‘In April, the company went to the extraordinary measure of reminding investors that its founders and promoters’ shareholdings remained in escrow until October after online forums, and the Australian Securities Exchange, questioned its rapid disintegration.’
‘But 1-Page is not alone. Shares in Perth-based telecommunications play Ziptel were trading as high as $1.35 in October. Yesterday they dropped another 2¢ to hit 18¢. Local technology play Brainchip, which burst onto the scene in April last year to reach as high as 46¢ a share, has continued its gradual drop, closing at 15¢ after last week raising $4 million.’
‘Asian-focused social media play MigMe, headed by Stephen Goh, has not yet been hit quite as hard, yesterday finishing the day at 53.5¢ a share after reaching as high as $1.25 in August last year.’
It’s funny. If you run one little ponzi scheme it’s a big scandal. If several of them are set up and run wide open in public, by a bunch of people who got rich running ponzi schemes, it’s practically a celebrity sideshow except with billionaires.
Oh, I’m off to my self driving flying car!! Do watch the puddle for me.
If you base your entire global economic order on Ponzi schemes, it’s central banking.
LendingClub Corporation (LC) -NYSE
4.32 Down 0.15(3.36%) 12:23PM EDT
Market Cap: 1.65B
P/E (ttm): 288.00
EPS (ttm): 0.02
Div & Yield: N/A (N/A)
52wk Range: 3.44 - 17.51
http://finance.yahoo.com/q?s=lc
“Market Cap: 1.65B
P/E (ttm): 288.00
EPS (ttm): 0.02″
That only computes in a ZIRP/NIRP monetary policy regime.
‘Offshore Chinese buyers are losing interest in NSW property, while local Chinese buyers are still out and about at auctions. Recent data from REA Group, which runs realestate.com.au, show that visits from buyers in China plummeted 24.9 per cent in the first four months of this year, when compared to the same period in 2015.’
‘Lulu Pallier, principal of Sydney Sotheby’s International Realty, who deals with overseas Chinese buyers, said there has been an evident slide in sales, blaming the tightening restrictions put in place by the government and banks. “When we used to have new projects, more than enough people would register before we even pre-sell. Now, most projects are lucky to even sell 20 per cent; it’s very slow.”
‘Ms Pallier said foreign Chinese buyers are now essentially required to bring the entire amount of the purchase price to seal the deal, because of bank lending restrictions to foreigners.’
‘“High net worth” foreign Chinese buyers are still seeking to buy off-the-plan, with location a top priority for most of them, according to Savills Residential Projects Director Peter Coulton. “What there has been is a slight decline for off-the-plan apartments that are priced between $500,000 — $600,000, where funding restrictions are an issue,” he said.’
‘Another significant Chinese market is on the rise, according to LJ Hooker Burwood Director Joe Murania. “The three or four properties I have now all have strong local Chinese buyer interest,” he said. Mr Murania recently sold 31 Wyatt Ave, Burwood for $5.71 million under the hammer to Australian-Chinese buyers — $1 million over the reserve. The 16 registered bidders were “predominantly Chinese”.
‘Richardson and Wrench Lindfield’s Jessica Cao said she also did not notice any change in Chinese buyer activity. “Almost any auction or sale in our area receives strong Chinese enquiries,” she said.’
Look at the photo that goes with this caption:
‘Local Chinese buyers purchased 7 Simpson Ave, Burwood last Saturday for $3 million.’
Savvy.
‘Real estate agents in drought-stricken central-west Queensland say the housing market is the worst they have ever seen, but agree there is a silver lining for prospective buyers. In Longreach, which has a population of about 3,000 people, nearly 200 properties are currently listed for sale.’
‘Dozens of rental properties are without tenants. It is in stark contrast to the situation four years ago, before the drought took hold, when only a small handful of rental properties were vacant.’
‘Real estate agent Howard Raven, who has worked in Longreach for about 18 years, said he had never seen the housing market in such a bad way. “To have [so many] vacancies and properties on the market is unbelievable,” he said.’
‘Mr Raven also lists properties in the nearby towns of Barcaldine, Blackall and Alpha and said those locations were in a similar slump. ‘Generally speaking I think we have an economic malaise throughout regional Queensland that is manifesting itself in less population,” he said. Couple that with the drought, of course that also compounds that issue, and there are less people, there’s less demand, so the prices are coming down. In some cases they’ve come down by 20 per cent, and possibly even more than that, depending on the property’s presentation and its quality.”
‘Rhys Peacock, who has worked in real estate in Longreach for eight years, and Blackall agent Helen Aspinall, both agreed the market was the worst it had been during their time in the industry. Mr Peacock said a boost to the rural sector was important for the property market to bounce back. We obviously need employment, we need that rural sector back,” he said. “We’re dependant on the people who work in the rural area, [such as] shearers. That’s when you’re going to get your little two-bedroom units, or one bedroom units [rented].”
‘Ms Aspinall said the mining downturn in the Central Highlands had also had an impact on the housing market further west. “Quite a few years ago to be able to live in Emerald or surrounding mining towns such as Blackwater, young families would have had to pay $800 to 1,000 a week in rent,” she said. “So [the] central west, being relatively close to the Central Highlands, these husbands and wives could drive over there in three to four hours and be home in three to four hours. It was cheaper for them, and better liveability for them, to be here with their families. Now with the job losses over there, there’s a high availability for cheap rent.”
A lot happening at the same time:
‘Sale price reduced on over 20% homes listed online in Taiwan: agency’
‘More than 20 percent of Taiwan homes listed for sale on the websites of real estate agencies have been marked down in June as the sellers are anxious to offload them as soon as possible in a slow housing market, the Yung Ching Realty Group said Thursday.’
‘Lin Tai-lung, a manager at Yung Ching Realty, said the prices of the homes were reduced due to a significant drop in the number of property transactions in Taiwan’s six major cities in the first five months of the year.’
‘In the period January to May, the number of residential and commercial property transactions fell 21 percent year-on-year to 65,000 units in Taipei, New Taipei, Taoyuan, Taichung, Tainan and Kaohsiung, he said, citing data from his company.’
‘The slowdown was most noticeable in Taipei and New Taipei cities in northern Taiwan, the two main barometers in the country’s housing market, Lin said. Since then, the prices of about 27 percent of Taipei homes listed for sale on real estate agency websites have been reduced, he said.’
‘In New Taipei, the most populous city in the country, about 25 percent of such housing properties have been marked down, Lin said. The price cuts indicate anxiety among sellers, as housing properties have been moving slowly since the start of the year, he said.’
“The Woodlands is a buyers’ market for high-end homes, particularly those priced above $700,000. The Woodlands has 8.9 months of inventory for homes priced between $700,000 and $800,000 and up to 15 months worth of inventory for homes priced above $1 million”
And with Texas property taxes a $700,000 home will only run you $15K a year to feed the county pig. What a bargain!
Not to mention the fact that median prices fell 11% year over year and falling fast.
$700k?
It appears there’s a whole lot of people who overpaid by 200 and 300% or more.
Thank goodness our wise, far-sighted Keynesian central bankers have avoided creating systemic risks to the global financial system with their prudent monetary policies.
http://www.businessinsider.com/heres-why-the-collapse-in-global-bond-yields-is-so-significant-2016-6
George Zweifler @gzweifler Jun 6
Survey of 100 brokers in Miami, top 2 amenities 1) schools 2) walkability . 75% say we are in #real-estate bubble.
https://twitter.com/gzweifler?lang=en
B..b..but I thought debt-fueled growth was the key to endless expansion and prosperity. Our Keynesian central bankers said so.
http://www.telegraph.co.uk/business/2016/06/09/brexit-might-trigger-run-on-britains-record-financial-debts-sp-w/
Fauxahontus Warren shows her true colors: champion of the .1%.
http://www.theguardian.com/us-news/video/2016/jun/10/elizabeth-warren-im-ready-to-work-my-heart-out-for-hillary-clinton-video
I was just thinking about ol’ Lizzie there. If Hillary picks her as a running mate, the optics of them shrieking and tweeting at Trump like a couple of spittin’ witches will be enough to ensure the vote of every man who has ever had a fight with his wife, girlfriend or mother, no matter what their race or cultural orientation.
“…shrieking and tweeting…”
Can’t be much worse than shouting and tweeting.
Don’t look now, but the Iowa Electronic Market just made a big move against the prospect for your loudmouth candidate to win in November:
https://iemweb.biz.uiowa.edu/graphs/graph_Pres16_WTA.cfm
“couple of spittin’ witches”
https://www.youtube.com/watch?v=20n-cD8ERgs
oxy just won the prize for best response of the day. Awesome.
The hubris is astounding. After all they’ve seen Trump get away with, they really think the scolding schoolmarm bit is going to carry the day. Unbelievable.
Another problem with the Hitler card. You got no where to go if it doesn’t work.
And it doesn’t work when your’e Mussolini.
Instead of ancient historical comparisons, how about we address the current reality?
‘The rich are hoarding cash’
‘Richard Fisher was president of the Federal Reserve Bank of Dallas and a voting member of the Federal Open Market Committee (FOMC) from 2005 to 2015. You couldn’t find anyone more wired into the Fed and the state of the economy than Fisher.’
‘He is worried about the $19 trillion US government debt (up $11 trillion since 2008) because the Fed has fired all its monetary bullets and can’t expand the balance sheet any further. But Fisher’s most telling comment came during the Q&A session when he was asked how his personal portfolio was positioned. Fisher’s response: “In the fetal position.”
‘Moreover, he also said (paraphrasing as closely as I can), “All my very rich friends are holding a lot of cash.”
All his rich friends. Oh boo-hoo, they are hoarding cash! Maybe the problems don’t involve Hogans’ Heros after all.
What does it mean that “they are hoarding cash”?
Do they have huge vaults a la Scrooge McDuck, full of enough cash to swim in?
Do they have their billions stashed away in Swiss banks?
Do they have “cash equivalents”?
“After all they’ve seen Trump get away with…”
Trump’s just get-n-started.
If Hillary picks her as a running mate, the optics of them shrieking and tweeting at Trump like a couple of spittin’ witches will be enough to ensure the vote of every man who has ever had a fight with his wife, girlfriend or mother, no matter what their race or cultural orientation.
It would probably work out the opposite way. Trump and his people would operate on your assumption and lose even more female votes.
He’s good enuf for Roseanne (that was a shocker. really. I was quite surprised)
The real shocker would be if Rosie O’Donnell came out for Trump. (I often confuse Roseanne with Rosie.)
I’m still shocked that people are giving her a pass on lying about her heritage.
It’s just a “little” lie? It all starts little, but goes to the core of a person.
At what point is a lie wrong?
^Priceless right there.
The ends justify the means to Clinton voters.
No kidding. Including the Republican establishment, lol. Paul Ryan just outed himself as an illiterate boob. He needs to stop digging. Every time he appears on camera, I cringe, because his entire look and persona is a most unfortunate tell.
Wait, I haven’t heard about this. What did he do?
http://www.cnn.com/2016/06/07/politics/paul-ryan-donald-trump-racist-comment/
Clearly he hasn’t a clue what the textbook definition is and made an utter fool of himself, along with the other illiterate pearl clutchers. Nor does he know anything about the rules regarding federal judges and impropriety and/or the appearance of impropriety.
As to the other, I’m not going to get into it. But if I were him, the less time spent on camera the better.
“Paul Ryan just outed himself as an illiterate boob.”
I realize he recently endorsed Trump. But nonetheless, isn’t that a bit mean spirited?
“America needs to get serious about the looming recession”
http://theweek.com/articles/628809/america-needs-serious-about-looming-recession
A fundamentally weak economy for years is no one’s imagination.
“Looming”?
Loomed …
“Something Big That Always Happens Right Before The Official Start Of A Recession Has Just Happened
“Last Friday, the government released the worst jobs report in six years, and that has a lot of people really freaked out.
“Michael Snyder | Economic Collapse - June 7, 2016
“What you are about to see is major confirmation that a new economic downturn has already begun.”
Link to follow for those who care and for those who dare …
Here …
http://theeconomiccollapseblog.com/archives/something-big-that-always-happens-right-before-the-official-start-of-a-recession-has-just-happened
You don’t need to see the jobs report.
The dramatic drop in the yields of 10-year rates says it all.
One has to wonder to what extent that development reflects the Fed folding on it’s frequently-jawboned liftoff plans. Of course the folding of plans can easily be construed as the Fed’s best response to a worsening economic picture. It’s hard to untangle these effects.
Imagine you’re standing in the toilet bowl, looking up, and the sky Darkens as a big hairy butt comes over the horizon…
“There is an entire industry that provides purchasing power to households through various debt instruments — credit cards, home equity loans, and so on.”
No shortage of “suits-n-ties” willing toss the middle-class under the bus.
“But if household net worth starts to decline, creditworthiness will decrease, leading to a decrease in consumer spending and thence to a recession.”
Maybe in the real-world of consequences, but not Janet’s world.
Houses represent large illiquid assets for tax-and-spend politicians.
http://www.businessinsider.com/uk-landlords-raise-rents-counter-new-stamp-duty-2016-6
The_Real_Fly
@The_Real_Fly
Dime Savings Offers High Interest Rates on Deposits to Lend More into Brooklyn Real Estate Bubble - $DCOM
https://twitter.com/The_Real_Fly/status/739522655024336896?lang=en
Best,low cost international dividend etf ?
For when the big one hits
It’s my (uninformed) opinion that the USA has the most fingers in the leper colony, i.e. everyone else is in even worse shape. So I disagree with your strategy of seeking international.
Unless there’s an international mutual fund with a basket of stuff from only tiny countries that aren’t completely f’d up. Guatemala still gonna sell bananas, right?
Cash my friend.
gold.
I agree with the physical gold and STUFF, like ammo, cigarettes, car parts, liquor, drugs, etc.
I’m iffy on cash. If the US goes down, cash could go full Wiemar.
Also remember that electric power plants don’t run themselves. There are a lot of paychecks involved in mining and transporting fuel, along with plant maintenance. Ditto for the food chain. If we have such a Big One crisis that those workers don’t get paid, and we lose reliable electricity or food, gold will still hold up. (bitcoin may not, sorry Bill)
lol@donk
The bitcoin halving is in one month.
Bitcoin price up 27% in ONE month, up 37% in 3 months up 31% in 6 months and up 134% in one year.
27% in one month. I wonder if the halving is being baked in?
Most people get pretty pi$$ed if they lose power for even a couple of hours.
Falling prices isn’t the end of the world my friends. To the contrary;
Nothing accelerates the economy and create jobs like falling prices to dramatically lower and more affordable levels. Nothing .
Home “owners” can install solar panels. Renters can’t
(I’d have solar panels if I had a house.)
You can always mount them on the donkey cart.
I wouldn’t give you a nickel for gold unless the plan was to sell it for more than a nickel of cash, and even at that the return wojld have to be 100% with no risk.
Silliest hobby ever this buying and selling gold.
It’s just shiny pogs.
Who said anything about buying and selling?
It’s a store of value - one of the oldest in the history of mankind.
Every fiat currency system fails eventually. Every single one.
Got physical?
I suppose that you could say that every institution created by people fails at some time. Such a statement doesn’t contain much useful information.
Gold’s value transcends institutions.
“Get real: Billions set to pour into real-estate investments”
“The Standard & Poor’s 500 and other big stock indexes will soon carve out real estate investments from the financial sector and give them their own category
“Associated Press
By Stan Choe, AP Business Writer
20 hours ago
“NEW YORK (AP) — Mutual funds are about to get much more real.
“A big change is coming in how stock indexes measure the market, one that’s likely to push tens of billions of dollars into real-estate investments, according to estimates. All that cash could drive further gains for a group of stocks that’s already done quite well since the financial crisis. Critics say it could also make an area of the market that they call overvalued even more so.
“The deluge of cash is the result of a re-think by index providers about how they see the market’s construction. The Standard & Poor’s 500 and other indexes have long split the market into 10 main sectors, such as technology companies or utilities or industrials. After the market closes on Aug. 31, S&P Dow Jones Indices and MSCI will carve out real estate to become the 11th sector.”
Link …
http://finance.yahoo.com/news/real-billions-set-pour-real-161651503.html
This is long overdue. Over the past several years, whenever financials took a hit, REITs would fall with them. It made no sense.
I’m not convinced that they are going to rocket up, but their volatility will not longer be tied to the volatility of the financial sector.
If you read the article, it’s like when teachers pensions decided to pile into mortgage backed securities.
Well then, I’m glad I’m already invested in REITs at a basis from 2008-2009.
‘Now I feel like when I’m not making a loss, I’m winning.’
I do feel that REITs are ahead of themselves right now, slightly overvalued. Only to get worse if the article is right.
My “problem” is that even if I feel the REITs are somewhat overvalued, selling $100 of stock means that I pay a bit over 30% to the government (my basis is about 15-20% of today’s market value).
I don’t think REITs are so overvalued that I’m a seller given my tax bite.
“Bear Stearns is fine!”
http://www.marketwatch.com/story/how-this-crazy-summer-is-turning-investors-desperate-2016-06-10
Another Captain Obvious economic forecast.
http://www.businessinsider.com/condition-red-alert-recession-is-imminent-2016-6
Quote of the Day.
http://www.theburningplatform.com/2016/06/10/quote-of-the-day-466/
A tax question for you gold bugs:
When you sell your gold coins (unimaginable, I know) do you get a 1099?
I suppose you could sell it to someone you know who isn’t a dealer, or exchange it for goods and services, but I’m guessing you’d get a better price from a dealer.
When you sell your gold coins (unimaginable, I know) do you get a 1099?
Not unless they are $10,000 or more worth at the sale.
I buy and sell for cash at my long time coin shop (since 2004). Last time I sold was in 2010.
“Not all Chinese investors are cutting back on speculative trading, with many shifting to the property and commodities markets instead. New home values in Shenzhen have jumped 62 percent in the past year amid a real estate boom in China’s biggest cities, while prices for everything from iron ore to steel and eggs surged on the nation’s futures exchanges earlier this year, before reversing at the end of April.”
It’s a bubble on steroids.
Are you planning to buy the dip during the summer panic?
A summer panic is starting to brew across markets
By Barbara Kollmeyer
Published: June 10, 2016 8:32 a.m. ET
Critical information ahead of the U.S. market’s open
…
yes, maybe when the vix hits 25
the world keeps spinning
How is the negative yield experiment working out for twenty-first century central bankers?
ft.com > Markets >
Capital Markets
Last updated: June 10, 2016 8:12 am
Bond yields in domino fall across the globe
Joe Rennison in New York and Leo Lewis in Tokyo
European bond yields continued to fall on Friday, as the global fixed income rally set fresh records from Tokyo to Frankfurt.
At the start of trade, the yield on 10-year German government bonds fell to a new record low of 0.020 per cent, after a fall of 1.1 basis points. Earlier, 15-year Japanese government bonds fell below zero for the first time.
Creeping fears of a global economic slowdown and waning expectations of a US rate rise this month have sent yields lower across the globe and — with investors clamouring for longer-dated debt — further flattened the yield curve.
The rally in bonds has pushed more than $10tn worth of government debt into negative-yielding territory, with corporate borrowers now beginning to join the sub-zero club.
The relatively better yielding US Treasuries — at 1.69 per cent for 10-year paper and 2.48 per cent for 30-years — moved back into territory last seen during February’s market turmoil.
…
=================================================
Gross Says Negative Rates Are Like ‘Supernova’ That Will Explode
John Gittelsohn
Bill Gross, the manager of the $1.4 billion Janus Global Unconstrained Bond Fund, warned central bank policies that pushed trillions of dollars into bonds with negative interest rates will eventually backfire violently.
“Global yields lowest in 500 years of recorded history,” Gross, 72, wrote Thursday on the Janus Capital Group Inc. Twitter site. “$10 trillion of neg. rate bonds. This is a supernova that will explode one day.”
A supernova is a star at the end of its life that suddenly increases greatly in brightness because of a catastrophic explosion that ejects most of its mass.
Gross has argued for some time that the economy is at the end of a decades-long cycle of expanding credit that has culminated in negative interest rates, a situation he said is unsustainable. Rather than spurring economic growth, low rates are promoting asset bubbles as investors reach for higher yields while punishing individual savers and industries that rely on interest rates, such as bank and insurance companies, according to Gross.
He said in a June 2 note that the era of 7.5 percent annualized investment gains is history and that investors should eventually take positions to protect principal or profit from market declines.
“Returns will be low, risk will be high and at some point the ‘Intelligent Investor’ must decide that we are in a new era with conditions that demand a different approach,” he wrote. “Negative durations? Voiding or shorting corporate credit? Buying instead of selling volatility? Staying liquid with large amounts of cash? These are all potential ‘negative’ carry positions that at some point may capture capital gains or at a minimum preserve principal.”
…
It’s too bad Rand Paul isn’t the nominee running on this foreign policy platform:
https://www.washingtonpost.com/opinions/why-trumps-foreign-policy-really-scares-neocons/2016/06/09/86614ac6-2cac-11e6-9b37-42985f6a265c_story.html
Neocons gonna neocon.
A lot of them are going to be out of a job. And they don’t know how to work. Neocons scared? All they do is scaremonger. Let us not forget:
‘Several years ago, I had dinner at Galileo, a Washington restaurant, with Steven Rosen, who was then the director of foreign-policy issues at the American Israel Public Affairs Committee. The group, which is better known by its acronym, aipac, lobbies for Israel’s financial and physical security. Like many lobbyists, Rosen cultivated reporters, hoping to influence their writing while keeping his name out of print.’
‘At dinner that night with Steven Rosen, I mentioned a controversy that had enveloped aipac in 1992. David Steiner, a New Jersey real-estate developer who was then serving as aipac’s president, was caught on tape boasting that he had “cut a deal” with the Administration of George H. W. Bush to provide more aid to Israel. Steiner also said that he was “negotiating” with the incoming Clinton Administration over the appointment of a pro-Israel Secretary of State.’
“We have a dozen people in his”—Clinton’s—“headquarters . . . and they are all going to get big jobs,” Steiner said. Soon after the tape’s existence was disclosed, Steiner resigned his post. I asked Rosen if aipac suffered a loss of influence after the Steiner affair. A half smile appeared on his face, and he pushed a napkin across the table. “You see this napkin?” he said. “In twenty-four hours, we could have the signatures of seventy senators on this napkin.”
“Residents told about the data said they weren’t surprised. Michael and Carmen Bednarz bought a house in Mystic Island in 2008 for $240,000. They estimate that it is worth about $170,000 now. ‘You try not to think about it,’ Michael Bednarz, 61, said. ‘You get depressed.’”
Don’t buy a home at a bubble peak, and this won’t happen to you.
At least they’re honest about it. They intuitively know there is no buyer out there for what they paid.
These people are light years ahead of everyone else.
Light years ahead, yet stucco for life. Go figure!
At least they’re past the denial phase.
‘In Abodo’s latest National Apartment Report, they reported that the District’s average rent dropped 8 percent from May to June of this year. With that drop, D.C. had the highest month-to-month fall of any Metro area in the nation between May and June 2016. According to Abodo, the average monthly rent for a one-bedroom in Washington, D.C. is $1,866, down from May’s average of $2,034.’
Some hot markets on the list of biggest decreases.
https://www.abodo.com/blog/june-2016-national-apartment-report/
Looks like some landlords will be helping their tenants move.
‘Four Pricey Rentals Appear at 56 Leonard Just Weeks After Closings Begin’
‘A three-bedroom is asking $28,000 per month’
‘Another high end luxury tower, 432 Park Avenue, recently began offering up its condos as rentals, with the building’s first recorded sale — a three-bedroom that sold for $18 million — appearing as a $60,000 per month rental back in February. Several other units have also debuted as rentals since.’
The comments on that board are priceless.
One comment …
“Does anyone know what that 2001 Space Odyssey Monolith looking thing is, in the Balcony picture?”
Looks like one of Hal’s memory banks after Dave got mad.
‘San Francisco to Airbnb: Enforce the rules or pay the price’
‘San Francisco city officials impose tighter restrictions on the short-term rentals blamed for amplifying the city’s housing crisis’
‘A study conducted by the city’s budget and legislative analyst found that 2,000 units were taken permanently off the long-term rental market for short-term rentals, Goossen said. “An estimated 1,200 San Franciscans avoided foreclosure or eviction by hosting on Airbnb,” the company said in a statement, “and this legally questionable proposal puts their housing at risk without offering any real solutions to fix the complex process.”
‘After the proposal of this new legislation several months ago, Airbnb contributed $200,000 to local candidates and ballot measures, according to the San Francisco Examiner.’
Seems kinda out in the open crooked.
‘Looks like some air is being let out of the Bay Area’s real estate market. Following years of increasing employment and wealth driving up rent and property prices in San Francisco and surrounding cities, demand for luxury housing appears to be on the decline and housing and condo price appreciation have “basically plateaued,” according to Paragon Real Estate Group.’
“Slowing or plateauing appreciation does not imply a crash, and the cooling of a desperately overheated market to something closer to normal is not bad news,” reads a report Paragon released.’
“Indeed, an improvement in housing affordability (and supply) would be good news, both socially and economically. Likewise, a shift from irrational exuberance in the local economy to rational optimism would be a healthy change,” according to Paragon.’
‘Slowing or plateauing appreciation does not imply a crash, and the cooling of a desperately overheated market’
What follows a boom? Hint: it isn’t plateau.
Placatory platitudes? Plaintive pleas? Plunging Planecrash?
‘Karina Carvalho and Terry Sweeney slash price of Brisbane unit’
‘Step inside the luxury home of ABC anchor Karina Carvalho and her businessman husband Terry Sweeney. The two bedroom Newstead apartment with panoramic views of the Brisbane River, has generated plenty of interest since it was listed in October last year.’
‘But nearly eight months on, it has failed to sell — and owner Sweeney has now been forced to drop the price by $60,000 — from $850,000 in February to $790,000 today.’
‘The IBM magnate, who bought the unit for $805,000 in May 2014, now stands to make a loss. When contacted by Confidential, he was not keen on having his home featured, but said ”everything’s going well with it. There are no issues.”
‘However, agents at LJ Hooker New Farm were excited by the publicity, with principal Brett Greensill hoping it would help generate a sale. “Terry doesn’t like people to know what he’s doing, but any publicity I can get the better,” he said.’
banks pressure from
online payments
flat rates
regs- sarbox and dodd frank
Re loans starting to stink
Wealth management vs Vanguard target funds
dude !
Can we at least get your ramblings in haiku form? You’re almost there now, just a little more effort.
‘A Houston business chamber is recommending that developers take their foot off the gas on Class A apartment projects. According to the Houston Business Journal, the Greater Houston Partnership is concerned that too many such projects are hitting the market, what with the city’s market slowing during the oil slump.’
The headline:
‘This Week in Houston Real Estate: A glut of apartments’
I can testify to that!!
” ‘In cases where you’re looking at homes and properties under $300,000 they are selling a little bit higher,’ McChesney said. ‘But, if you’re getting above that $300,000 level, the buyers out there aren’t there, even though the inventory is still low, we just don’t have the purchasers, so it’s not driving the price up.’”
Grand Junction has a median household income of 47k… or did during the oil boom. I wonder what the problem could be?
Reportedly the 2nd largest natural gas deposit in the country there, it’s too bad there’s no demand and no buyers:
http://www.bizjournals.com/denver/blog/earth_to_power/2016/06/colorado-has-far-more-recoverable-natural-gas-than.html
7% unemployment even during good times. Have a lot of family from there, and they scattered to survive.
Today’s tally…..
The violence is gonna escalate here as the weather gets hotter and more humid…..
http://www.chicagotribune.com/news/local/breaking/ct-chicago-violence-shootings-20160609-story.html
Venezuela at a breaking point?
Correction there bloomie - Venezuela BROKE a long time ago - it is just now that the press and the peeps are starting to catch up with reality.
And remember when Obama was glad handing ol’ Hugo?
http://www.bloomberg.com/news/articles/2016-06-09/venezuela-is-at-a-breaking-point
Are portland and Seattle the only perky markets remaining?
Binge on Portland is on Netflix
Seattle was very late to the crash party last time.
‘Tis true. The Seattle Bubble website covered this in graphical detail.
Vienna, VA Affordability Improves As Housing Prices Dive 4% YoY
http://www.zillow.com/vienna-va/home-values/
http://abcnews.go.com/Politics/clinton-donor-sensitive-intelligence-board/story?id=39710624
If you’re doing sh*t like this, I suppose you want to protect who sees your e-mails.
Ashland, OR Affordability Surges As Housing Prices Crater 8% YoY
http://www.zillow.com/ashland-or/home-values/
‘He detailed erosion in what had once been a high-flying rental market in Dawson Creek, which had posted the second-highest rental rates in the province as recently as two years ago, spurring a multi-family building boom. ‘It used to be impossible to find a place to rent. Today, property management firms have given me vacancy estimates over 20%.’ Kurjata said he has reduced rents on older apartments he owns to around $950, down from the $2,200 range two years ago.’
‘In 2012, he noted, a half-duplex on 104th Avenue in Dawson Creek sold in a month for $323,000. The adjoining, identical three-bedroom unit is now listed at $269,900 and has been on the market for 127 days ‘with no offers,’
I spent the night in Dawson in 2001 (not Dawson Creek, BTW). As I made my way to Alaska, I would look at real estate prices. It was nuts even then.
‘Longer settlements are a concern in their own regard, especially in an environment of falling dwelling prices,’ Mr Kennedy said. ‘Indeed, JP Morgan analysts highlight industry feedback suggesting banks are revaluing off-the-plan dwellings approaching settlement well below the initial purchase price. As a result, additional buyer equity is required to cover any shortfall between the sale price and what banks are willing to lend, increasing the risk of settlement failure.’
‘banks are revaluing off-the-plan dwellings approaching settlement well below the initial purchase price. As a result, additional buyer equity is required to cover any shortfall’
Some of these tiny units in Melbourne don’t even have external windows. 20% of them have been reported unoccupied. Safe deposit boxes in the sky indeed.
Here’s what will happen:
‘At the high end, one property magnate recently admitted that the market for £2million to £10million homes had ‘collapsed’ and that Chinese speculators were ‘walking away’ from new-build flats they had agreed to buy’
‘The island that was once lauded to be Phnom Penh’s biggest entertainment and residential complex was a flurry of construction activities when most of its high-end condominium projects broke ground in 2010, but some projects have run out of steam. Khan, head of valuation at Independent Property Services Cambodia, noted that some initial Casa Meridian buyers are asking to sell or lease their units out as well’
And they resumed the champagne parties in Miami too, around 2010. Now they go right back up for sale or rent as soon as they are completed. Same with Manhattan. Coincidence?
Think back; what happened around 2010?
do they get marched out into the countryside (fields)?
Non-traditional lenders warn developers and real estate investors of looming recession
“If you are going to do a CMBS deal, now is the time do it:” Mary Scott, Principal Real Estate Investors
June 10, 2016 11:15AM
http://therealdeal.com/miami/2016/06/10/non-traditional-lenders-warn-developers-and-real-estate-investors-of-looming-recession/
“We have the market connections and insights to deliver a continuous supply of quality investments to help meet investors’ needs.”
Patrick Halter, CEO
Principal Real Estate Investors
https://www.principalglobal.com/principal-real-estate-investors
‘Commercial Mortgage-Backed Securities (“CMBS”) represents a prominent segment of the U.S. commercial real estate investment landscape, carrying an outstanding balance of over $564 billion.1 Principal Real Estate Investors believes current economic trends, U.S. commercial real estate fundamentals, and factors specific to the CMBS market are conducive to positive long-term CMBS performance. Moreover, strong excess spread relative to alternatives, attractive risk-adjusted return trends, and portfolio diversification benefits are some of the main reasons investors should consider adding CMBS exposure within the context of broader fixed income and/or real estate portfolios.’
‘The performance of U.S. commercial real estate, including CMBS, is driven in large part by the health of the labor market. Indeed, 2014 was a strong year for job growth as total employment surpassed the pre-recession peak in April and full year payrolls rose by over 3.1 million (nearly 260,000 per month)2. With unemployment levels dropping, low interest rates persisting, and inflationary pressures remaining manageable, consumer spending ended the year on a high note, up 4.3% in the fourth quarter3. U.S. commercial real estate is benefitting from these trends in the form of generally positive rent growth and declining vacancy rates, resulting in year-over-year increases in net operating income (NOI), as seen in EXHIBIT 1.0. This trend is supported by historically low levels of new construction (EXHIBIT 1.1), allowing landlords to benefit from attractive supply/demand dynamics in most U.S. real estate markets. These factors have culminated in rising real estate values, with prices exceeding prior peak levels in major markets, although nonmajor markets have yet to fully recover (EXHIBIT 1.2).’
Note to webmaster; consider updating your site more often than every couple years.
’strong excess spread relative to alternatives’
Heck of a job Janet.
Miami-Dade’s underwater home rate falls below 20 percent in Q1: report
Las Vegas is now country’s worst market for underwater homes
June 09, 2016 03:45PM
http://therealdeal.com/miami/2016/06/09/miami-dades-underwater-home-rate-falls-below-20-percent-in-q1-report/
At least the Clintons are consistent………once crooks, always crooks.
Or I suppose that you could say the Clintons are “making government act more like a business”, by renting out the Lincoln bedroom, or in this case, selling a sensitive government office to a HFT.
http://tinyurl.com/zu8nqm4
Like I said above, if this was the stuff I was doing, I’d want to control who had access to my e-mails too…
That’s just the thing, she didn’t have control. Her server was insecure, hacked, probably more than once. It’s been mentioned the Russians took a look-see. If so, there would be a record of it the FBI could detect.
But yeah, why try to destroy tens of thousands of emails? And I thought the NSA had a copy of everything. Where are those? Here’s something I came across the other day; the inspector general of the state department issued a report the other day. Guess who the IG of the state department was when Clinton was the secretary?
There wasn’t one.
She certainly thought she had control over backups, what was deleted, etc.
But she did not have control over hackers…that is for damn sure.
I think that the reason Sanders hasn’t bowed out completely is that he knows the risk to HRC over the e-mails isn’t zero…he wants to “hang around the hoop” as they say.
“According to new data……..”
Which can be massaged to say pretty much what you want it to say.
Especially in places in Flyover like Grand Junction, where the numbers can be distorted badly by a few above or below market sales
“Sales out in BFE up 50% from a year earlier……”
Yeah…….four houses were sold last year, eight were sold this year.
Remember this most important tip:
” its more important than ever to hire a good real estate agent”
lol@lola
Hi, I’m new here. How should I invest in housing. I’m really interested in the Phoenix area, and I hear prices are on the rise.
Is that true.
Phoenix is very hot. But not in housing.
Yes, that has me scared. There are some real water quality issues in Phoenix. I want to find a city that’s cheap, but has a pure and reliable source of water.
I’m taking a road trip this summer, and I’ve got several great cities in mind. Phoenix, Vegas, Pahrump, Sequim, WA,
the Oregon Coast, Bend, Oregon, Boise, Idaho, Oakhurst, CA,
Nashville Tenessee, Missouri. There has to be a place out there with a negligible bubble, right?
“There has to be a place out there with a negligible bubble, right?”
Of course, but you can forget about the “metro” areas.
“A metropolitan area, sometimes referred to as a metro area or just metro, is a region consisting of a densely populated urban core and its less-populated surrounding territories, sharing industry, infrastructure, and housing.” —wiki
the end or solution to bond buying
since these g\programs are gov endorsed the gov will seize assets from private citizens, savings and higher property taxes
what other escape is there?
It’s been so long we forget. If you could ask a person in the 80’s or even early 90’s, what conditions would you expect for US treasuries to yield near zero and $10 trillion world-wide government debt yielding negative? They would probably guess, nuclear war? A plague of some sort? Would they believe stocks would be at all time highs, along with real estate?
Hey, should I buy a house now.
I’m a newbie, and I don’t know much
about finances
How can I not destroy myself with bad investments?
Wait for the investment you are interested in to crash.
Yes, but my wife is itching for a house now, and if I have a super reliable income stream, isn’t housing as good as anything over the long run?
Super reliabile income stream. I was also a federal employee once.
Wow, are you a mind reader.
Well I bought a house as a federal employee. The work was steady. However the problem was the government was getting rid of the defense contractors. I kept my job but it depressed real estate. I expect you are in a large city so you would be immune to effects of your government organization getting rid of contractors. I could not stand watching my house go down in value. Buying a house at age 31 was the worst personal finance mistake I ever made.
In the long run, maybe. We’re at the end of a huge run up in prices, and will see another crash like 2006.
Tell her you will be able to buy a better house if you wait. If you don’t talk her out of this, you’re going to resent here when the house you bought is worth less than you owe on it.
Stack your cash in the meantime. When nobody else has any, you’ll be able to write your own deal.
“Yes, but my wife is itching for a house now…”
You better buy, or those legs will be welded shut! Hehe.
Wives tend to favor buying at bad times, such as when mania thinking becomes the dominant vibe.
Don’t use long-term debt to buy long-lived, big-ticket, deprecating assets (e.g. a single family home) unless it happens to be the trough of a recession and you find yourself financially fit, confident about buying and qualified to make a purchase when others around you are losing their jobs and selling their homes or losing them to foreclosure. And if you don’t feel comfortable buying under those conditions, then simply learn to enjoy renting and diversify into less risky assets than owner-occupied housing, such as stocks, bonds, commodities, cash… pretty much anything else!
P.S. I almost forgot to add: I actually have practiced what I preach. The two times my wife and I bought were both in the long tail of the early 1990s recession, before the onset of mania. And both times, we sold later with a capital gain.
Why buy it when you can rent it for half the monthly cost?
Buy later after prices crater for 65% less.
How much of our bubble out west is from fake Yuan paying all cash just to get the money out of China before they are caught?
But couldn’t a China crash be good for the American economy in the long term?
Just a reminder there boyz and girlz - Hitlery is from a suburb (Park Ridge) of the fair utopian paradise known as Chicago ILLANNOY.
And several planks in her platform will be built on this…….
https://www.illinoispolicy.org/chicagoans-the-most-taxed-residents-in-illinois-paying-more-than-30-city-taxes/
The Miday, an aircraft carrier uses 260 gallons (984 liters)
used per mile.
anyone believe the Puerto rico deal won’t cost taxpayers?
next is IL,NJ etc
jaytaylormedia.com/just-another-day-in-regulated-europe/ - 57k -