To View Lending For Property As Less Risky
A weekend topic on some writings starting with Cody Cain at Salon. “If you ask anyone what caused the devastating 2008 financial crisis, you’ll invariably receive the same answer: Wrongdoing by the Wall Street banks. This is no wonder because this explanation has been trumpeted everywhere. It’s all over the media, our politicians repeat it endlessly, and the current presidential candidates harp on it incessantly. So this explanation has now seeped into our public consciousness as the conventional truth. But there is a tiny little nagging problem. There just seems to be some very curious flaws in the case that simply do not seem to add up.”
“The problem with this analysis is that it ignores the fundamental essence of what a mortgage loan is all about. The bank lends not based upon the income of the borrower, but instead, the bank lends upon the value of the house. The collateral for a mortgage loan is not the borrower’s stream of income, it is the house itself. If the borrower fails to repay the loan, the bank’s primary remedy is not to seize the borrower’s income, but instead, the bank forecloses upon the house, sells the house in the market, and applies the sale proceeds to repay the loan. So any analysis of the riskiness of a mortgage loan must be based upon the value of the house, not upon the income of the borrower.”
“Income serves as a useful indicator of whether the borrower is likely to meet the monthly loan payments. But income does not determine whether a mortgage loan is fundamentally good or bad, only the value of the house does that. So income, no matter how badly misstated, could not possibly have caused the financial crisis.”
“In addition, incomes became less of a factor as a result of the housing bubble. As the bubble expanded, home values kept increasing. Year after year prices experienced double-digit increases. This attracted a stampede of investors, just like in every bubble. It wasn’t that the banks were negligently failing to consider the borrower’s income and concealing it, but rather, investors were not concerned about the borrower’s income when the value of the house was certain to increase. Thus is the nature of bubbles.”
From Dan Barnabic at MarketWatch. “The prices of real estate in major selected urban centers are still going up. But job growth and wages cannot keep up the pace, in fact, they lag behind very badly. Will the average American middle-class buyer be able to consider buying into already overvalued real estate in those hot-spot cities such as San Francisco, Portland, Seattle, L.A., San Diego, Denver, Miami, Atlanta, not to mention New York City? The simple answer is no.”
“One has to be blind not to see what is really coming. We are already in serious bubble, the fact that stakeholders such as real estate brokers and speculators, even existing owners of overvalued real estate deny in fear of losing their commissions and equities. And fear they should. We are now living in the market which is almost solely driven by speculators hoping to flip the properties for even higher prices to Chinese and other off shore buyers and some domestic naïve buyers, who just about forgot or don’t bother to remember the last devastating real estate crash of 2007.”
“The latest gimmick involving condo developers’ promises for guaranteed first and second year rental income has turned even ordinary folks into speculating investors. They are buying condo units and other types of real estate hoping to ride the wave of success by selling them later at a higher prices. Due to sheer number of such investors-turned-speculators, the market has now entered into in artificial state of (high) demand. At the first sign of an economic slowdown, the speculators will retrieve, bringing the buying frenzy to a hold.”
“Suddenly, everybody will realize there is no actual demand. In a resulting panic, many investors will dump their units onto the market, causing prices to plummet and wreak havoc in the process. The glut of available units for rent will become a clear signal to buyers that there is an oversupply of units on the market. When this realization sinks in, a downtrend in condo unit market will begin.”
Liam Dann at the New Zealand Herald. “The median price of an Auckland house has almost doubled since the bottom of the last cycle in 2009, in the depths of the global financial crisis. The boom has now spilt over into the regions, with places like Hamilton and Tauranga surging 26 and 23 per cent respectively in the past 12 months. The big problem, says economist Shamubeel Eaqub, is that we have a banking system designed to view lending for property as less risky than other kinds of lending.”
“‘Our banking regulation allows us to feed on the property market,’ he says. ‘Of all the debt that is created in New Zealand, more and more is going towards mortgages because mortgages are less risky according to our rules and regulations.’”
“As house prices soar, the size of mortgages has to grow with it. There is no easy way out of the cycle. If house prices fall, then highly leveraged investors and many home buyers will be left exposed. ‘When it happens it will be nasty,’ says Eaqub. ‘There is no other way to describe it. What we have built up is ugly.’”
“What happened to the US housing market in the global financial crisis provides a sobering example. But in New Zealand it could be even worse. One thing favouring the Nevada home owners — and those in many other US states — were laws that allowed them to walk away from a debt-laden house. In those states, if a property ends up worth less than the mortgage, the homeowner can effectively post the keys back to the bank and leave their debt behind them.”
“In New Zealand there’s no such escape: the debt stays with the borrower. ‘In terms of the chilling effect on the entire economy it’s much much bigger,’ Eaqub says. ‘In Vegas people had these enormous debts that they knew they’d never be able to pay back. In New Zealand people know they have to pay it back.’”
From Chris Sorenson at Maclean’s in Canada. “After years of pumping money into the country’s frothiest housing markets, Canada’s big banks are suddenly—and alarmingly—nervous about the debt-fuelled monster they’ve helped to create. In the span of a few days this week and last, several big-bank CEOs and chief economists let loose a flurry of warnings about surging home prices in Vancouver and Toronto, where it now costs an average of $1.5 million and $1.3 million, respectively, to buy a detached house.”
“Such remarks are a marked departure from the finance industry’s earlier nothing-to-see-here attitude. So why the sudden change of heart? It no doubt has much to do with Vancouver detached-house prices surging by 37 per cent in the year to this May, and Toronto’s soaring by a still ear-popping 15 per cent. Those sorts of gains are unsustainable and suggest investor euphoria—the always-dangerous ‘fear of missing out’—has firmly taken hold.”
“Yet, while Scotiabank says it voluntarily curtailed its mortgage business, it’s unlikely to pull back on the reins too hard for fear of losing market share to competitors and leaving money on the table.”
“So is there any way for Ottawa to cool sizzling housing markets like Toronto and Vancouver without putting others into the deep freeze? There may well be—and it’s already coming down the pipe. When Finance Minister Bill Morneau announced the latest changes to CMHC mortgage insurance last December, he also proposed forcing banks to hold more capital against mortgages in cities where property prices are high relative to borrowers’ incomes—like Toronto and Vancouver.”
“The policy shift, the finer points of which are still being hammered out by Canada’s banking regulator, would effectively make it more expensive for banks to lend in higher-priced housing markets, prompting them to either pass along the extra costs to borrowers or issue fewer mortgages.”
“A better option is raising qualifying interest rates for five-year fixed mortgages. While this would also have a nationwide impact, Craig Alexander, the VP of economic analysis at C.D. Howe and a former Toronto Dominion Bank chief economist, argues the risk may well be worth it. ‘If you purchase a home but can’t make the payments if interest rates go up by two percentage points, you probably shouldn’t be buying that home in the first place,’ he says.”
“Income serves as a useful indicator of whether the borrower is likely to meet the monthly loan payments. But income does not determine whether a mortgage loan is fundamentally good or bad, only the value of the house does that. So income, no matter how badly misstated, could not possibly have caused the financial crisis.”
Obviously this guy never opened up an economics text book, as income is a fundamental building block of demand: No income, no budget constraint, no demand… unless the government hands you a loan based on and guaranteed by other people’s money, that is!
Not demand, the loan. In 2010 I helped a person buy a foreclosed house at auction for $12,000. It had sold in 2006 for just over $100,000. What did the income of of the borrower, or lack thereof, have to do with the lender taking such a loss?
Wow, $100k —> $12k, a tight haircut. Hehe.
Wow! You did that person a great favor and they still regard you highly I’ll bet.
I gave a former girlfriend of mine four one tenth ounce gold eagles back when gold was $600. I also advised her not to buy real estate back then. I bet she remembers the advice because that was around 2007.
“Wow! You did that person a great favor…”
Probably turned that into an income property; low risk, winner.
That $12,000 probably is earning residual income of $800 or more per month. Not bad.
I prefer doing so with savings bonds and municipal bonds. Though it takes me about $400,000 to get $1,000 per month. Hank’s taxpayers, for allowing government to borrow. By he way, I am your creditor.
“What did the income of of the borrower, or lack thereof, have to do with the lender taking such a loss?”
I guess the answer is ‘it depends.’
For example, long-term posters here recall the example of a California Central Valley strawberry picker family who was handed a $700K+ loan to buy a house with something like $30K in annual household income available to service the loan plus pay for all other living costs. I have to guess that in this case, the eventual value of the loan was negatively impacted by a lack of available income to continue paying the mortgage; if the income were available, the loan would not have gone into default.
However, I concur that the value of the collateral also matters to the lender or investors who fund a loan. If strawberry picker owners default but the value of a home rises to, say, $800K, thanks to generous runway foaming by the Fed, then the lender will come out just fine, regardless of the plight of the former occupants. Conversely, if bubble valuations collapse between when a purchase is made and when the lender takes possession of a home in a foreclosure action, then you have the situation you described, where the income of the former occupant also matters little.
However, I concur that the value of the collateral also matters to the lender or investors who fund a loan.
The value of the collateral only matters to the lender if the lender is able and willing to take possession of the collateral. The GFC had the noteworthy characteristic of lenders who were unable or unwilling to do take possession.
I know this first-hand, as I’m currently attempting to assist in moving some derelict properties into new hands, properties that my father last made a payment on sometime in 2007, I believe. Whether this was the result of a MERS mess, a lender who can’t produce paperwork (and didn’t even get it into MERS correctly), or something else entirely, I really don’t know.
“The value of the collateral only matters to the lender if the lender is able and willing to take possession of the collateral.”
And conversely, the willingness of a lender to take possession of the collateral is heavily dependent on the value.
Hence all the foam on the runway.
And conversely, the willingness of a lender to take possession of the collateral is heavily dependent on the value.
I don’t think that explanation is sufficient; the value of the properties was initially WAY higher than the near-zero value to which the lenders have chosen to let them degrade. And yet, they did not foreclose.
All that comes to mind is that the lenders must have some other business to pursue that is far more lucrative than piddling around with taking possession of and reselling foreclosure homes.
But if the homes were worth, say, ten times the value loaned at the time of purchase, then the situation might be a lot different.
‘more lucrative than piddling around with taking possession’
Don’t forget the rule change that allowed them to take the loss only when they foreclosed. Such a loss would require more capital reserves, and cutting current profits. You give them the choice of taking an asset off their books and making it a loss, or doing nothing. The incentive here isn’t hard to understand.
And isn’t it interesting no one has mentioned this rule be put back in place now that the markets are hot, hot, hot?
“You give them the choice of taking an asset off their books and making it a loss, or doing nothing. The incentive here isn’t hard to understand.”
Who wins from a rule change that creates perverse incentives for maintaining housing supply in the face of a supposed housing shortage? That’s just dumb.
‘Neil Barofsky’s new book — Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street – are so disturbing. Barofsky was the Special Inspector General of the Troubled Asset Relief Program (TARP), put in charge to monitor how the hundreds of billions of taxpayer dollars were spent.’
‘According to Barofsky, the Home Affordable Modification Program (HAMP) did not have a goal of keeping struggling families and children in their homes. It’s real goal, according to U.S. Treasury Secretary Tim Geithner, was to “foam the runway” for the banks.’
‘Here’s an excerpt from the book: “For a good chunk of our allotted meeting time, Elizabeth Warren grilled Geithner about HAMP, barraging him with questions about how the program was going to start helping home owners. In defense of the program, Geithner finally blurted out, ‘We estimate that they can handle ten million foreclosures, over time,’ referring to the banks. ‘This program will help foam the runway for them.’
“A lightbulb went on for me. Elizabeth had been challenging Geithner on how the program was going to help home owners, and he had responded by citing how it would help the banks. Geithner apparently looked at HAMP as an aid to the banks, keeping the full flush of foreclosures from hitting the financial system all at the same time. Though they could handle up to ‘10 million foreclosures’ over time, any more than that, or if the foreclosures were too concentrated, and the losses that the banks might suffer on their first and second mortgages could push them into insolvency, requiring yet another round of TARP bailouts. So HAMP would ‘foam the runway’ by stretching out the foreclosures, giving the banks more time to absorb losses while the other parts of the bailouts juiced bank profits that could then fill the capital holes created by housing losses.”
Was it legal for the Fed to engorge banks with profits while Main Street twisted in the tornadic winds of panic-induced job loss and foreclosure? Where in the Fed’s mandate are they granted Committee-to-Save-the-World powers to pick winners and losers?
Ben,
>>Don’t forget the rule change that allowed them to take the loss only when they foreclosed.
Was that rule change part of HAMP? I searched “HAMP foreclosure loss recognition” and found nothing. I would really like to know which law ot came from, if anyone knows.
Here is what I think happened: The delayed loss recognition rule was even worse than just foaming the runway! Banks waited many years to foreclose, all the while piling on substantial penalties and expenses, so that owners would stay underwater EVEN when the house value eventually rose above the loan balance. The penalities did NOT reflect actual costs or losses to the banks (especially with ZIRP in effect), in fact penalties were simply tools to make it impossible for the homeowner to get back above water after the market improved. Hence, the bank got to make a profit on foreclosures, especially in the hot coastal markets. And the banks probably even got to deduct unpaid penalities as LOSSES against their profits, even though such losses were largely imaginary.
It was a FASB rule change, the Financial Accounting Standards Board. Usually FASB looks at rule changes for years. This was rammed through with political force.
“EVEN when the house value eventually rose above the loan balance.”
Historically, it doesn’t work that way. The ‘value’ doesn’t rise. They don’t double or triple. Houses depreciate and at best tread water only after the depreciation is offset by throwing more money at it.
Don’t forget the rule change that allowed them to take the loss only when they foreclosed. Such a loss would require more capital reserves, and cutting current profits. You give them the choice of taking an asset off their books and making it a loss, or doing nothing. The incentive here isn’t hard to understand.
I believe you are speaking about the suspension of mark-to-market accounting.
This had to do with difficult to value securities due to inactive markets (ie. the CDO-squared’s that rarely traded and ended up at pennies on the dollar).
If the bank held the debt on a piece of property, and it was impaired based on the value of the property in an active market, they had to write down the debt.
Banks are required to mark to market UNLESS a market is inactive.
Guys, thanks, yes it probably was an FASB rule. However, I should note that I thought the FASN m2m suspension was for mortgage BONDS. and not for idividual mortages. Maybe that does not make a difference, since it pretty muych all mortgages were securitized anyway.
I want to mention something I forgot in my precious posts. I think banks padding their penalties excessively also led to another effect, namely that private homebuyers could not “compete” with the banks (or bondholders) at the trustee sale, because the highly padded default judgement amount still was higher than the market value. Do you see what I’m saying here? Original balance X, plus penalties and interest Y, results in default Z=X+Y. Market value M may be in between somewhere, that is X < M < Z, and a private buyer might want to buy the house for M. But the bank/bondholder will bid Z, because that costs them nothing, and get the house. The bank can then turn around and sell for price P=M (or more), while claiming Z-M as a (fake/exaggerated) loss and at the same time keep most of M-X as profit, because the penalty/loss Y was largely an exaggeration and an accounting fiction to begin with. A very nasty way to harvest a fake tax loss at the expense of everyone, while at the same time keeping a profit. The preceding is a bit complex, so I hope I explained it ok.
Banks waited many years to foreclose, all the while piling on substantial penalties and expenses, so that owners would stay underwater EVEN when the house value eventually rose above the loan balance.
It wasn’t about piling up penalties on the loanowners—the real goal was to reap the real cash “servicing” payments from Fannie/Freddie for managing these “distressed” properties. When the loans were in default, the banks got paid MORE for “servicing” them; this gave banks the perverse incentive to keep the loans unforeclosed, while they got paid larger $$$s for managing/servicing. Foreclosure would reduce a bank’s cash-flow!
I have witnessed many, many people stay in their upsidedown over mortgaged houses…..because they have the income to continue. The premise by Cody Cain is very wrong. In fact, would go so far as to say it’s ridiculously stupid and ruins a my credibility.
‘and ruins a my credibility”
I knew you wouldn’t like it. You’re one of the “loans were bubble/prices can never go too high crowd”. Looks like we’re getting close to the end of that rope.
So here’s another data point to contradict the view that income has no effect on the value of a loan.
I rather suggest that so long as a loan is in payment status, income matters; however, it’s not the only thing that matters.
“ruins ANY credibility.”, sorry for the typo. The premise ruins Cains’ credibility, because it is false.
BTW, I am not in favor of a bubble market or volatile pricing. I prefer an orderly market with strong supply/demand fundamentals.
It’s actually reality.
A mortgage contract is foundational on the collateral value. The debtor is immaterial.
The company I worked for took 75-90% losses on some lot loans in FL and SC. We are talking up to $600K in losses. The manager of the Foreclosure department told me he would not take those lots if they gave them to him. Also, lots of foreign buyers. Hrd to collect from them!
It’s complicated. I posted this before; years ago a bank was marketing a foreclosure. Agent told me they were offered 350k, turned it down. Fannie then had to take it and sold it for 250k. The bank was waiting for a bigger payout from Fannie which had guaranteed the loan.
What I learned in the foreclosure biz is common sense doesn’t often apply. We went from jumping in the day the FB turned off the utilities and winterizing, to going in for the first time and seeing calendars, mail and newspapers that were three years old. This happened in the space of about 4 years.
“The bank was waiting for a bigger payout from Fannie which had guaranteed the loan.”
That’s one of the problems with Uncle Sam Insurance, Inc. They have a way of creating moral hazard problems with the way they design their products.
I look at loan rates posted at my bank and they remind me that no 57 year old with a brain would get a loan to buy a house. Then I think of my age and the morning is ruined!
If you keep the loan-to-value ratio in a reasonable range (under 80%), then it can make sense in some markets to carry a mortgage and keep funds equal to the balance of the mortgage in a more liquid investment vehicle.
Of course, California is different so this wouldn’t work there.
A massive mortgage payment on a depreciating asset at a grossly inflated price never makes sense. Hell…. paying cash for a rapidly depreciating asset at a grossly inflated price makes little sense.
Just make sure the bubble is history and prices are in the toilet before you even think about buying. If everyone you know says you would be crazy to buy a home, that will be a good hint that your timing is right.
I remember hearing from someone at Countrywide that none of their MSR evaluation models built in negative HPI. If real estate only goes up, “you can’t lose” if you make a loan.
“The bank lends not based upon the income of the borrower, but instead, the bank lends upon the value of the house.”
The value of the house that is determined by total strangers, the ones who set the prices of the comps, the ones who may have lost their minds.
“The collateral for a mortgage loan is not the borrower’s stream of income, it is the house itself. If the borrower fails to repay the loan, the bank’s primary remedy is not to seize the borrower’s income, but instead, the bank forecloses upon the house, sells the house in the market, and applies the sale proceeds to repay the loan.”
Okay so far.
“So any analysis of the riskiness of a mortgage loan must be based upon the value of the house, not upon the income of the borrower.”
But the value of the house is closely related to the prices of similar houses, the prices of the comps, and these prices are set by total strangers who, again, may have lost their minds.
The term “value” is used here as if this term has some sort of fundamental quality to it but actually the only quality it has to it is determined by the decisions of strangers - herds of strangers - who are the ones who set the prices of the comps, IOW the “value” of the house is totally determined by the prices of the comps, prices set by strangers, prices set by the actions of the herd.
Lemmings.
In a market driven by reason value and price are separate, they are two different things. In such a market an item can become considered to be overvalued and sales will drop off or it can be considered to be undervalued and sales will pick up. Econ 101.
But in a market driven by price increases value and price are not seemed to be separated at all, instead they are considered to be one and the same. And because they are considered to be one and the same the measurement of so-called value is really a measurement of price.
Price equals value. Increase the price and - presto! - you have just increased the value.
And there is another factor to consider: Even though the seller gets his price the buyer does not have to pay it, the buyer does not have to pay the seller’s price, he only has to promise to pay it. In such a world the path of least resistance to the direction of prices is up.
If you see videos of people going crazy and fighting over sale items in Macy’s they are doing so because the prices of the items they have been fighting over have been REDUCED.
But when you read of bidding wars (another form of craziness) popping up in living rooms of houses that are put up for sale the driving force behind this sort of craziness is not price reductions instead in is price increases.
Macy’s causes people to go crazy by reducing prices, the RE industry causes people to go crazy by increasing prices.
One market, Macy’s is a value driven market; The other market, the RE market, is a price-increase driven market.
Here’s a short video of a Black Friday sales event from 2011 …
https://www.youtube.com/watch?v=il_AwIFsHk4
Here too (run time = a bit over 13 minutes) …
https://www.youtube.com/watch?v=j8EzEGRgN_E
“Price equals value. Increase the price and - presto! - you have just increased the value.”
Plus you have increased imputed rents and GDP. Small wonder that real estate always goes up!
“In addition, incomes became less of a factor as a result of the housing bubble. As the bubble expanded, home values kept increasing. Year after year prices experienced double-digit increases. This attracted a stampede of investors, just like in every bubble. It wasn’t that the banks were negligently failing to consider the borrower’s income and concealing it, but rather, investors were not concerned about the borrower’s income when the value of the house was certain to increase. Thus is the nature of bubbles.”
Bankers and other folks on the lending side of a mortgage can rest easily when they know that real estate is only going to go up, since the collateral value of any loan that goes into default will automatically exceed the loss on foregone payments.
It’s when collateral value collapses, leaving millions upon millions of mortgages underwater, that ample foam needs to be applied to the runway to remedy the situation.
If your an EU based company and draggi is buying your bonds are taxpayers basically funded stock buy backs etc ?
Janus Capital @JanusCapital
Gross: Global yields lowest in 500 years of recorded history. $10 trillion of neg. rate bonds. This is a supernova that will explode one day
10:05 AM - 9 Jun 2016
http://www.marketwatch.com/story/bill-gross-negative-yields-will-lead-to-supernova-like-market-implosion-2016-06-10
‘we have a banking system designed to view lending for property as less risky than other kinds of lending.’
‘Our banking regulation allows us to feed on the property market’
Why are house loan interest rates so much lower than others? When I first got into this I did research on default rates. Over many decades defaults on mortgagees were very low and consistent. Yes, there would be problems here and there but it was like a bedrock. Prices didn’t go up much either. Prime loan defaults were 1%, maybe a little more, a little less.
In what was such a safe lending environment, what has changed? Prices go up a lot now. Since 2010, some places saw prices go up double digits for 80 consecutive months. Yet interest rates would indicate no risk about the underlying loan.
Recall that in the mid-80’s Fannie and Freddie took a huge jump in the percentage of the housing loan market. Now they and HUD are the market. It seems there has been a disconnect in the risk of a loan and the price of houses, all while the mortgage interest rates (which is supposed to reflect the risk of default) have been on a 30 year decline. Maybe this is the “big problem.”
‘Our banking regulation allows us to feed on the property market’
“Yet interest rates would indicate no risk about the underlying loan.”
‘Real estate madness infects the suburbs; Poco councillor says governments aren’t doing enough. Vancouver, BC, Canada’
‘It doesn’t matter where you look these days, property prices are skyrocketing everywhere. Even the big banks in Canada are saying it’s a problem, asking the feds last week to step in and cool off the market.’
‘Port Coquitlam city councillor Brad West spoke with Mike Smyth on CKNW today and he says part of the problem is that governments have failed to confront the high-priced housing market head on. West says he started to hear from people in his community awhile ago about the high prices they were being asked to pay for modest homes.’
“People were being outbid, homes started going for more than a hundred thousands dollars over asking. So you were getting modest homes in Port Coquitlam of 2100 square feet that were going for over a million dollars.”
‘He says not that long ago a home on his mom’s street sold for $1.3 million dollars. These are homes that were purchased in the early 90s for $150,000-$200,000.’
‘Agents buying up entire blocks of houses, only to leave them sitting empty.’
‘West says he recently got a call from a resident who told him about a real estate agent buying homes up on his block. The agent knocked on the homeowners door just before Christmas and offered him $800,000 for his home, cash offer, saying he was buying up homes on the block.’
“He first knocked on his door just before Christmas and he said, “We’re buying up this whole block, I’ve bought a bunch of your neighbour’s homes, I’ll give you $800K for your home.” And the guy said “well, my home’s not for sale”. Guy went away and sure enough he’s been buying up homes on that block in our community, and this guy (homeowner) is the last holdout. He’s bought other homes on that block, all cash offers, no subjects, doesn’t even want to look in the home to see what it looks it.”
‘West says the resident called him last week after the realtor showed up at his door again, this time offering $1.3 million for the home.’
“So that’s what we’re seeing, and unfortunately what’s happened is it’s priced people out of our community and it means now on that block some of those homes are sitting vacant.”
‘Agents buying up entire blocks of houses, only to leave them sitting empty.’
An overseas money-laundering operation, for sure. Sickening.
Kangbashi or Vancouver, it doesnt matter - Chinese love their ghost cities, lol!
I find the people who feel the need to own everything have some mental issues - they’re compensating for some personal shortcoming. To own something you don’t enjoy or even use makes no sense to me.
Tax vacant housing. It’s the only chemotherapy for the illness that directly addresses the tumor!
+1. I like the vacancy tax for being incredibly well-targeted.
Canada is so screwed up. How about not letting people bring in suitcases of money? Aren’t these Chinese supposed to be limited to 50 grand a year by their government? I posted an anonymous interview with a Vancouver broker a year or so ago. He said it’s completely corrupt, everyone knows it and don’t give a damn because they are raking in money hand over fist. The governments sit there and pretend to care or do some little study, while they rake it in too. Then the developers hand them the cash to run for reelection. I know Canadians like to think of themselves as progressively moral and well governed, but this situation shows otherwise.
“He said it’s completely corrupt, everyone knows it and don’t give a damn because they are raking in money hand over fist.”
Throw a few corrupt real estate dealers into prison and the problem would end in a hurry!
“Throw a few corrupt real estate dealers into prison and the problem would end in a hurry!”
Not so sure about that since China parades their criminals in the street wearing sandwich boards citing their crimes before the firing squad ends it all; it appears to have little effect on continued crime. The CEO guy who built the airport for the Olympics was executed for fraud and kick-backs.
‘The federal government would be better-served by encouraging the construction of new homes in Toronto and Vancouver, rather than trying to clamp down on foreign buyers in Canada’s two white-hot real estate markets, according to an expert.’
‘David Rosenberg, chief economist and strategist for Gluskin Sheff and Associates, said the federal government’s attempts to cool Canada’s hottest housing markets present a “social risk” to first-time homebuyers.’
“You’re pricing out a generation of young people,” Rosenberg told the Business News Network on Tuesday. Rosenberg says the feds don’t have a lot of options when it comes to restricting foreign investment in Toronto and Vancouver, which is suspected of driving up prices in those markets. Instead, Rosenberg suggests Finance Minister Bill Morneau and his staff should turn their attention to encouraging more new housing projects, so there will be more supply to meet demand.’
‘And while higher prices are keeping first-time homebuyers down, they’re doing little to discourage Chinese investors from entering the marketplace. “These are inherently non-price-sensitive entities,” Rosenberg said of the Chinese investors. “They’re still buying as many units… as they were a year ago when prices were 30 per cent lower.”
‘Last week, the Toronto Real Estate Board said that the city set a record with nearly 13,000 homes sold in May, even as the average price of a detached house reached $1.28 million in the city. The record numbers were recorded even after Morneau increased the amount required to put a down payment on a home over $500,000.’
‘Prior to Morneau’s appearance in the Senate, Rosenberg said there was “no question” he would be asked about a possible housing bubble.’
“The next question is, what are you going to do about it?” Rosenberg said.’
And that’s the end of the report. I’ll point out that in Canada and Australia it is said without hesitance that people are “obsessed” with housing. Have been for 20 years or more. What was the situation before people were obsessed with houses? Prices hardly moved.
‘One of Vancouver’s top realtors has been voted out of what he calls the “insiders club” after speaking out about unethical practices and lax penalties in the city’s frenzied real estate market. Re/Max realtor Keith Roy has been on the professional standards committee of the Real Estate Board of Greater Vancouver since 2014, helping with its private adjudication of complaints, primarily from realtors about realtors.’
‘The Globe and Mail has learned the board voted not to renew Mr. Roy’s position on Thursday. One board member, upset over that decision, has resigned in protest. “My removal comes at a time when I am publicly advocating for changes to improve ethics and consumer protection,” Mr. Roy said. “I’ve been told someone said: ‘Well, he kind of had it coming for talking.’”
‘Mr. Roy has been particularly critical of the board for keeping its disciplinary decisions under wraps. “There are realtors that have been punished multiple times and the people who hire them don’t know that,” Mr. Roy said, repeating an earlier criticism. “I am seeing the same names over and over – and the public will never know.”
Disgusting.
‘For more than a dozen years, Bob Rennie, Vancouver’s real estate guru, has annually taken the temperature of the city’s housing market and offered a numbers-numbing report to the Urban Development Institute.’
‘This year he’s calling quits to his annual UDI updates, but not before he delivered a bare-all speech Thursday as Vancouver continues to wither under white hot sales that have made “housing affordability” two empty words. (He’s not getting out of the real estate business, just his annual updates to UDI.)’
‘Under his mantra of “it’s seriously time to change the narrative,” here’s five things Rennie said at the lunch.’
‘1. Forget thinking homes in Vancouver can be affordable any more. Last year only 26 houses sold in Vancouver went for under $750,000, compared to 10,325 in Metro Vancouver. This year, 26 homes in East Vancouver sold for under $1 million, and only three on the west side sold for under $1.7 million. “The City of Vancouver should get out of the affordable ownership business.”
‘4. Don’t blame China, and don’t tax foreign ownership. But a speculation tax? That’s OK. “China buys $6 billion a year in British Columbia exports. Are we going to tamper with those jobs and our economy? … A foreign ownership tax of 10 per cent on a $5-million home will not stop a sale or create affordability … It will only cause racially charged conversations to go beyond where they are now.” Rennie says he still believes a speculation tax aimed at buyers who flip a home would cool the market at the lower end.’
‘5. There’s a glut of money heading for the market. With $197 billion in mortgage-free properties held by people over 55 ($66 billion of that with people over 75), there’s a lot of money available to help their children buy homes. But there’s no market or supply, so the result? Surging prices as people bid up those scarce listings.’
Clark thanks condo kings for their support - The Globe and Mail
http://www.theglobeandmail.com › News › British ColumbiaThe Globe and Mail
May 16, 2013 - Video: What Christy Clark can learn from her stunning election … “I want to say a special thanks to Bob Rennie and Peter Wall,” Ms. Clark told …
Bob Rennie’s $25,000 lunch: Why Vision’s Vancouver is so …
themainlander.com/…/bob-rennies-25000-lunch-why-vancouver-is-unaf…
Mar 7, 2014 - Organized by real estate marketer Bob Rennie, it’s the most recent, and perhaps … he threw his weight behind Christy Clark’s leadership bid in 2011. … and his support for her during the provincial elections was critical for the …
Bob Rennie | NUVO Magazine
nuvomagazine.com/magazine/summer-2015/bob-rennie
May 28, 2015 - Bob Rennie’s love of art and his passion for collecting were sparked on a trip to …. An unwavering Christy Clark supporter (even when other polls were … Gregor Robertson have been elected mayor without Bob’s support?
Clark’s Pay from Donors Too Tied to Real Estate Moguls: Eby | The Tyee
thetyee.ca/News/2016/05/02/Clark-Donors-Tied-Real-Estate/
The Tyee
May 2, 2016 - Premier Christy Clark with BC Liberal Party fundraising chair Bob Rennie, who has made millions marketing … Support for new construction.
Bob Rennie, Vancouver Condo King, Calls For B.C. Tax On House …
http://www.huffingtonpost.ca/…/bob-rennie-vancouver-real-estate-tax_n_7425...
May 22, 2015 - Vancouver Mayor Gregor Robertson supports Rennie’s idea. … B.C. Premier Christy Clark, who counted Rennie as a big supporter during her …
Is Vancouver’s condo king calling the shots on the city’s affordability …
http://www.scmp.com/…/vancouvers-condo-king-ca...
South China Morning Post
May 28, 2015 - Bob Rennie says focus on foreign money is anti-Chinese racism, and … his support for a speculation tax to the Premier [Christy Clark] earlier in …
“Surging prices as people bid up those scarce listings.”
Using money that they do not have.
This makes bidding up prices easy to do; Promises of cash are much cheaper to fork over than actual cash, in the short run at least.
In the long run? Not so much. But that’s manana.
‘Bank requires few mortgage documents: Seems like housing deja vu’
‘Nearly a decade after the financial crisis began, a new version of the stated income loan is making a comeback.
“Lite Doc.” That is what Quontic Bank, an FDIC-insured community lender in New York City is calling its product. It requires only verification of employment and two months worth of bank statements. For self-employed borrowers, it requires documentation of one year of profit and losses. The Lite Doc loans are five-year adjustable-rate mortgages with interest rates in the low- to mid-5 percent range, according to the bank.’
‘The Quontic loan does not have to comply with strict new “ability-to-repay,” or ATR, rules established in the wake of the financial crisis under Dodd-Frank legislation, due to a little loophole: Quontic is designated as a community development financial institution, or CDFI, under a small U.S. Treasury program which funds economic revitalization in low-income communities.’
‘The fund, established in 1994, “serves mission-driven financial institutions that take a market-based approach to supporting economically disadvantaged communities,” according to the Treasury website. Quontic, based in Queens, New York, meets the requirements because it makes loans to borrowers in a low-income community. CDFI lenders are exempt from having to comply with so-called ability-to-repay rules.’
‘Housing Bubble 2.0: Predatory Lending Is Back’
‘So how exactly is it predatory when you fully disclose the monthly payment and give someone a ton of money that you never get back? I never got this. No doubt there were some really bad characters in this whole story. But there was far more stupidity than there was maliciousness. Losing your money to someone is not malicious.’
‘Now, to be fair, there was a ton of collateral damage done to people who did not participate in the madness. They stayed within their means and made their mortgage payments but eventually they lost their jobs and their homes because the global economy went down the toilet. But that is a separate issue related to the fallout of bad economic practices of this magnitude.’
‘Regardless of how you see the past we can probably all agree that loose lending standards are not a good thing for the housing market or the economy. Fortunately, in the aftermath of the meltdown lending standards tightened and loan defaults plummeted. But it didn’t take too long for politicians to start decrying the plunge in homeownership rates (back to historic norms I might add). And guess what? There are programs out there once again where you can buy a home with only 3.5% down.’
‘But wait! It gets worse. Yesterday I hear about this bank in New York, Quontic Bank, essentially bringing back the worst of the bad loans - the no-doc/ low-doc/ stated income loan, also known as the liar loan: Bank requires few mortgage documents: Seems like housing deja vu. Except this time it’s called the lite doc loan.’
‘Of course, it’s some kind of government program that facilitates this kind of lending. Normally banks would have to make sure that borrowers have the ability to repay the loan. The government requires this because you can’t be trusted to figure this out yourself if you are either borrowing the money or lending the money. But this bank is part of a special class of banks that are exempt from this rule because they officially fund economic development in low income communities.’
‘The best part of this whole story is that apparently having this special status allows Quontic to make these loans all across the country, and not just to low income people. Your government at work.’
‘So then CNBC gets this Bruce Marks guy on TV. He’s the CEO and founder of the non-profit Neighborhood Assistance Corporation of America which makes loans to low income people. You can find his interview at 1:55 in the segment below. It only takes him about 10 seconds to start throwing the P word around - like these borrowers have no choice in getting these loans. I’m thinking that even non-profits don’t like competition.’
‘Bruce proceeds to talk out of both sides of his mouth. He’s simultaneously angry that these loans are bad for consumers while also lamenting the fact that they will end up helping higher income people rather than lower income people. So which is it Bruce? Do these loans help or not?’
‘Nevertheless, the one thing I can agree with Bruce on is that it seems unwise to lend money to someone without verifying that they are going to be able to pay you back. It’s just that I wouldn’t call that predatory. I’d call it stupid.’
“…Quontic Bank, an FDIC-insured community lender…”
Now that’s just not right.
“The “Lite Doc” loan is not the “low-doc” loan of the past. It is only for owner-occupied properties, so no investors, and it requires a 40 percent down payment on the property, far higher than most conventional or government loan products. There is a minimum FICO credit score of 700, and the borrower must show he or she has a minimum of 12 months worth of principal, interest, taxes and insurance in the bank at closing.”
Not quite the no-doc, poor credit, no asset, 0% down, liar loan of the past.
Nope.
These are ARMs and the requirements can be waived.
Question: why is there so much so much on Vancouver on this site? I appreciate the information but now am wondering if there is something ‘unique’ to Vancouver or is the insinuation that this is going to happen in markets around the U.S.? Or possible someone just happens to be interested in Vancouver? Can I translate this information to Palm Beach County Florida (for instance). If so I can’t wait for someone to show up at my door and offer me 1.5 million for my home. Please delete this post if it is inappropriate for the site.
There’s a housing bubble in Vancouver.
“There’s a housing bubble in Vancouver.”
Pick a chart …
https://www.google.com/search?q=vancouver+housing+prices+graph&biw=1360&bih=651&tbm=isch&tbo=u&source=univ&sa=X&ved=0ahUKEwjshJO-kKDNAhUG82MKHWSfBBIQsAQIGw
If Median Income matters; there are a lot of cities at totally unsustainable levels.
Mortgage Fun with Excel - Maximum Borrowing.
Safe Harbor Mortgages Max DTI 43%. (using goal seek)
Maximum Amount loans at Median Income of $56,000
Assuming 3% down, 4% 30 Yr., 1.4% prop.Tax, .4% ins.,
$50/mo HOA, and $0 in other exp. (CC/Cars/Stud. Lns)
Max borrowing$305,000 Max House Price $315,000
Assuming 3% down, 4% 30 Yr., 1.4% prop.Tax, .4% ins.,
$50/mo HOA, and $500 in other exp. (CC/Cars/Stud. Lns)
Max borrowing$227,000 Max House Price $234,000
‘According to a recent McKinsey study, in the seven years since the bursting of a global credit bubble that resulted in the worst world financial crisis since the Great Depression, overall global debt has increased by around US$60 trillion, or by some 17 percentage points of global GDP. As a result, rather than reducing indebtedness, today practically all of the world’s major economies have higher levels of overall borrowing relative to GDP than they did in 2007.’
‘Of particular concern has to be the over-indebtedness in key regions of the global economy. Among the more vulnerable of these regions is the formerly rapidly growing emerging market economies, which went on a borrowing binge in the up phase of the international commodity price cycle. These economies now account for around 40 percent of world GDP and until very recently were the major engine of global economic growth. Since 2008, corporate indebtedness of the emerging market economies has more than doubled to around US$23 trillion.’
‘More troubling yet, as the Bank for International Settlements keeps reminding us, is the fact that over the past seven years, these emerging market corporations have increased their U.S. dollar-denominated indebtedness by over US$3.25 trillion. This makes the emerging market economies particularly vulnerable to crises, especially at a time when their currencies have plummeted and they are being hit hard by a major international commodity price bust. It also does not help matters that a number of key emerging market countries such as Brazil and Russia are in the grips of very deep economic recessions.’
‘It also has to be of major concern that non-financial enterprises in China, the world’s second-largest economy, have gone on a borrowing spree of epic proportions. It is estimated that over the past seven years, the debt of these enterprises increased by a staggering 90 percent of China’s GDP. This rate of credit expansion is very much more rapid than the private sector credit expansion which preceded the bursting of the Japanese credit bubble in the late 1980s or that which occurred before the bursting of the U.S. housing bubble in 2006.’
‘It also is hardly comforting that sovereign debt-to-GDP ratios in the European economic periphery, and in key European countries such as Italy, remain at troublingly high levels. This is all the more the case considering the fact that European politics now appears to be fragmenting and that European banks continue to hold a disproportionate amount of their countries’ sovereign debt on their balance sheets. In this context, it might be recalled that Italy’s banking system is already on a shaky footing, while its sovereign debt market, at more than US$2 trillion in size, is the world’s third largest government bond market.’
‘High levels of global indebtedness might not be a matter of major concern in the context of a rapidly growing world economy and of one that is not beset by major economic risks. However, today’s global economy is anything but rapidly growing, especially outside the United States. More troubling yet, it would seem that rarely before has the global economy been confronted with such a confluence of major risks in so many different segments.’
His big conclusion:
‘With global debt at such a high level and with so many risks currently confronting the global economy, one has to hope that world economic policymakers are not lulled into a false sense of security by the present calm in global financial markets. Rather, one would hope that they do not succumb to the temptation to engage in a premature normalization of interest rates. One must also hope that those countries that do have the room to engage in fiscal stimulus use that room wisely to help put the world economic recovery on a sounder footing.’
‘Ethan Penner, managing partnet at Mosaic Real Estate Investors, and Shari Olefson, attorney and director of The Carnegie Group think tank, disagree about whether the crosscurrents in the property market are pointing to a bubble.’
‘Penner told “Squawk Box” that he’s not worried about these factors causing a bubble. “We are clearly at very high pricing by historical standards. But that’s true of every financial asset. And in my mind, it’s more of a reflection of [Federal Reserve] interest rates policy than anything else.”
‘Olefson sees bubbles in some markets, citing the rate of housing price increases outpacing wage rises as a red flag. Additionally, Olefson said she’s concerned about how the 2008 housing crash has changed the way Americans think about homeownership.’
“We have removed the stigma associated with foreclosures. Before the bubble and the crisis, nobody really knew what would happen if they went into foreclosure. No one knew what a short sale was. That is [now] common vernacular,” she contended. “When Americans start looking at housing as something to speculate on,” she said, “that’s actually the biggest indicator I think in this modern-day housing world of a bubble.”
‘Penner countered by saying speculation should not be viewed as an overly worrisome sign. “Speculative orientations exist in every market all the time.”
‘Tucson has unveiled a new program to help low and middle income home buyers afford a down payment. Since the housing bubble burst nearly ten years ago, rules have changed which make a down payment a requirement when buying a home. But with stagnant wages and large debt for college grads, coming up with a down payment has become difficult. As a result, Tucson has had a difficult time recovering from the housing bust.’
‘Tucson home ownership rate in near 42 percent but it’s more than 60 percent nationally. Tucson had 27,208 vacant homes in 2015 while only 16,700 in 2000, during the housing boom.’
‘In his state of the city address five months ago, Mayor Jonathan Rothschild said “over the next four years, we will increase home ownership in the City of Tucson.”
‘This is a big step towards that goal. It’s a program which the mayor has brought the public, private, and non-profit sectors together to achieve it. The program is called “Pathway to Purchase”, a state program which has a $70 million fund which will provide up to $20,000 in down payment assistance for anyone making less than $93,000 a year, providing the home is less than $371,000.’
‘But this is not “deja vu all over again” we are told. “This isn’t ‘oh no, here we go again,’” said Ray Desmond, founder of Nova Home Loans. “It’s not.”
“I think people have learned their lesson,” said Eric Gibbs, President of the Tucson Association of Realtors. It is an opportunity for people who have had a bad experience to get back into the market albeit on surer footing. “Even those buyers who have lost their homes through foreclosure and short sales have an opportunity to get back in the market through these programs,” said Gibbs. “We call them boomerangs.”
‘making less than $93,000 a year, providing the home is less than $371,000′
If you make 93k in Tucson you are wealthy, and a 371k house is pretty expensive even in Phoenix.
Yeah 93k for Tucson is a lot of money. I lived there. Not much has changed on prices the sixteen years after me and my girlfriend moved out of Tucson. I probably would be making 93k there now, had we stayed. I was at $60,000 when we moved and I was paying $600 per month for our apartment on the north side. Was still able to save for an IRA, invest in some stock funds and contribute full to my 401k.
You’ll need to earn alot more than $93k to float a $370k shack. And you’ll have to earn it every year for 30 long years.
‘Lone Star Funds is planning to issue the first rated bonds backed by mortgages to borrowers with weaker credit since the 2008 financial crisis, according to Fitch Ratings. The bonds are supported by $161.7 million of mortgages, according to Fitch. The borrowers have credit scores a bit lower than prime on average, and the bonds carry extra risk because, for example, the homeowner may have high levels of debt compared to income, the ratings company said. Borrowers for about 47 percent of the debt had a prior credit problem, such as having filed for bankruptcy or gone through foreclosure.’
‘Fitch said it expects to assign credit ratings as high as A to the bonds. Credit Suisse will underwrite the offering.’
‘The Lone Star deal is designed “to provide credit to underserved borrowers and increase homeownership amongst borrowers who are locked out of the agency mortgage process,” company spokesman Joe Sala said in a statement.’
‘Justin Perras, spokesman for Credit Suisse declined to comment.’
‘The ratings company said it evaluated the bonds using the framework it previously used for “Alt-A” home loans, with some variations based on the mortgages. Alt-A loans were common before the housing bubble burst, and were non-prime mortgages whose borrowers may have had relatively high credit scores but didn’t qualify for home loans that could get packaged into government-backed mortgage bonds.’
‘Many, for example, were small-business owners that couldn’t document their income because they kept much of their earnings at their companies to reduce their personal income taxes.’
‘Lone Star will retain at least 5 percent interest in the deal, the Fitch report said, ensuring that sellers of such mortgage bonds keep “skin in the game” and will suffer along with investors if the debt goes bad.’
Wow, 5%. They are probably making more than that on the deal.
IMO this is an indication that the RE market is running out of buyers …
“‘The Lone Star deal is designed “to provide credit to underserved borrowers and increase homeownership amongst borrowers who are locked out of the agency mortgage process,’ company spokesman Joe Sala said in a statement.”
I’ve gone through the FAQ PDF you can find here before:
https://www.fanniemae.com/singlefamily/homeready
Started in December 2015. Pedal to the metal Mel Watt in action.
“‘Lone Star Funds is planning to issue the first rated bonds backed by mortgages to borrowers with weaker credit since the 2008 financial crisis…”
LONE STAR!!
https://www.youtube.com/watch?v=FcArnepkhv0
I can find these all day:
‘Guaranteed Rate First Offering 1% down Payment Loans to Chicago Homebuyers’
Available for refinance too.
The only thing missing is a poorly produced commercial, like the ones you see for used cars:
“Bad credit? No credit? Bankruptcy? We approve everyone! Come on down to Lone Star!”
You think the NAR will resort to stoop-cleavage tactics to close?
One article after another that calls out;
-Grossly Inflated Prices multiples over long term trend
-Collapsing Demand At 20 Year Lows
-Fraud
crushing.housing.losses.
“Suddenly, everybody will realize there is no actual demand. In a resulting panic, many investors will dump their units onto the market, causing prices to plummet and wreak havoc in the process. The glut of available units for rent will become a clear signal to buyers that there is an oversupply of units on the market. When this realization sinks in, a downtrend in condo unit market will begin.”
Who needs HUD programs? All you have to do is not bail people out, and the free market will produce “affordable housing” all by itself!
Worked for Miami in the last bubble. All of us ended up paying for the bubble that turned around its downtown.
I’m hoping that the speculators have built enough in NYC to have a similar effect, trickling down from all those see-through ultra-luxury buildings. Having everyone rush to get projects coming out of the ground before lucrative tax breaks for new construction expired might be just what we needed.
1921 & 1981 allow markets to adjust and u get nirvana
Otherwise you get japan ,greece
looking at 2020-2021 for that.
HILLARY-BERNIE: MAKE STAGFLATION GREAT AGAIN!
Lol. Don’t look now, but it appears Mitt Romney is having a complete meltdown, now lashing out at his fellow losers.
http://www.politico.com/story/2016/06/mitt-romney-donald-trump-republican-candidates-224216
Jeebus, this guy really is three bricks shy of a load. He runs a losing campaign, and then excoriates others for doing the same.
Talk about crater rage.
I thought he’d be at Bilderberg.
And in other political news, the Libertarian Party has an absolutely AWESOME ad out:
https://www.youtube.com/watch?v=QFwdvMQHmOI&feature=youtu.be
One of the best I’ve seen yet. Whew. That’s some good stuff there. My hat’s off to them.
‘When Blitzer pressed Romney on his future plans, he revealed that he once thought that, had a candidate such as Florida Sen. Marco Rubio, Wisconsin Gov. Scott Walker, or Bush won the White House, he could have held an administration role. With Trump and Hillary Clinton as the nominees, he joked that a cabinet post was now unlikely.’
The butthurt is thick and bitter.
On another note, ZH posted an interesting chart comparing presidential campaign payrolls since March 2015. Holy Jeebus. Someone knows how to do a lot with very little.
http://www.zerohedge.com/news/2016-06-11/chart-day-big-vs-small-government
One way or the other, Romney is going to have fun saying “I warned you” on the morning after to Republicans who backed Trump.
lol, Romney. He’s a good neoliberal democrat. Don’t let the door hit him where the good lord split him.
Romney is going to have fun saying “I warned you”
Seems like the only person who can correctly say “I warned you” right about now is Trump.
Not talking about”right now”. I’m thinking ahead to the morning after the Republican party’s wedding night with Trump.
“I’m thinking ahead to the morning after the Republican party’s wedding night with Trump.”
Jeebus, you’re not paying attention. He’s already shortsheeted the bed and tossed the mattress. There will be no wedding night. That’s why all the boo-hoo-hooing.
Wait, I feel a song coming on:
https://www.youtube.com/watch?v=XsYJyVEUaC4
There’s more boo-hooing ahead if Trump’s nullified marriage contract with the Republican Party leads to major problems for his campaign going forward.
The Republican party is not his problem. His mouth is not his problem. The epic fail of the Trump campaign has taken place and unless he moves to repair it, he’s done. And oddly, it’s not what he said, but what he didn’t say.
His silence in the aftermath of the physical attacks on his supporters in San Jose was deafening. He might as well have just flipped them off. It’s been noticed, by one of his most influential internet blog supporters, who has written about it already.
When the media tells its story, this small but glaring fact will be drowned out in the din of “Republican Party!” “Hispanics!” “Women!” “Vulgarity!” “Foreign Policy!” “Judge Curiel!” He’ll never know what it was, in all the confusion.
I may at this point be out, haven’t decided yet, I’d like to give him a chance to repair the situation. If he picks Newt or Condoleeza as a running mate, I’m definitely out and will be voting Gary Johnson.
“If he picks Newt or Condoleeza as a running mate, I’m definitely out and will be voting Gary Johnson.”
Condee could be a good choice to get back some of the black and women votes that would otherwise inevitably go to Hillary.
Tally from last night - 19 shot and 2 dead.
Nightmare this place.
http://my.chicagotribune.com/#section/889/article/p2p-87521013/
“Tally from last night - 19 shot and 2 dead.”
Emergency room surgeons, nursing, the hospital rooms, and the police detective work, and the disability checks, etc., just think of the GDP be generated in just a few hours.
Good luck with your escape.
St. Louis, where I used to live, also has a Knives and Guns Club.
Coppell(Dallas), TX Affordability Improves As Housing Prices Crater 5% YoY
http://www.zillow.com/coppell-tx/home-values/
‘The price of Southern California and U.S. commercial real estate has been rising for years, but it may be leveling off or even declining in the coming years, according to a new economic forecast from UCLA’s Anderson School of Management.’
“The combination of a less favorable financial environment along with weakening fundamentals arising from increased supply and reduced demand will likely bring to an end the seven year bull market in commercial real estate,” wrote senior UCLA Anderson economist David Shulman. “To be sure, we are in no way forecasting a ‘crash,’ but rather an extended period of sideways to down prices.”
‘Wayne Brandt, national originations director for Wells Fargo Bank, said he has become more cautious about making loans to commercial developers in anticipation of the shift. “I think we’re all looking at 2018, 2019 and 2020 as a slowing,” said Brandt.’
‘Commercial rents increased 10.9 percent in greater Los Angeles from 2013-2015 and considerably more in areas dominated by tech companies, according to CBRE. South Orange County saw 22 percent rent growth during the same period while Santa Monica posted an 18 percent increase.’
‘an end the seven year bull market in commercial real estate’
You won’t believe this:
‘As rent has gone up in Denver, so have tensions between landlords and tenants. But even we were shocked by the vitriol of a debate on the topic that recently sprouted in the Rants and Raves section of Denver Craigslist.’
‘The online conversation was kicked off by a post from a landlord lambasting renters as worthless, creepy, disgusting liars. A tenant quickly shot back, accusing landlords of sheer greed. After that, the battle was on. And while there were few moments of agreement, folks on both sides found different ways to blame marijuana legalization for the situation.’
‘Check out the back-and-forth below, with photo-illustrated takes from four landlords (or those taking their side) and an equal number of tenants (or all-purpose landlord haters). That’s followed by a related post titled “Rent Whiners: A Native’s Perspective.” But a warning: The language in this post is raw. Really raw.’
Raw doesn’t describe it.
Memorializing this stuff on the HBB makes it the repository for everything relevant and truthful to this unprecedented mania.
LOL.
I did not realize that people actually move to Colorado so that they could smoke pot!
I would not think of doing so. If I wanted to smoke marijuana here in California, I would, no matter what law. People are stupid to want to follow unjust laws.
Just break the obnoxious laws.
“I am free, no matter what rules surround me. If I find them tolerable, I tolerate them; if I find them too obnoxious, I break them. I am free becaus I know that I alone am morally responsible for everything I do.” - Robert A. Heinlein
“I did not realize that people actually move to Colorado so that they could smoke pot!”
Hamsterdam!
“If I wanted to smoke marijuana here in California, I would, no matter what law.”
Berkeley!
Speaking of Berkeley …
In Berkeley protesters strip naked to try to save the trees.
http://www.berkeleyside.com/2015/07/18/in-berkeley-protesters-strip-naked-to-try-to-save-trees/
The trees caught scabbies.
Those trees are eucalyptus. I’m guessing the reason FEMA stepped in is because the wood is unstable and large branches have a way of breaking off in stormy weather and landing on people’s heads, killing them.
Widowmakers
The Fed: epic incompetence, or something worse?
http://www.alt-market.com/articles/2916-the-federal-reserves-strange-behavior-makes-perfect-sense
These might be more efficient and effective than RageCages.
http://goo.gl/Eghc2v
When will the bank runs start (or accelerate) in southern Europe, as depositors yank their accounts rather than risk another Cyprus-style “bail-in” officially sanctioned theft of their money?
http://wolfstreet.com/2016/06/08/next-banking-scandal-in-spain-banco-popular/
And now, it seems a new scandal is in the works. Last month Spain’s sixth largest financial institution, Banco Popular, announced that it was urgently seeking to raise €2.5 billion in capital in a desperate bid to shore up its finances. The news triggered a sell-off that wiped out 33% of the bank’s market capitalization in just two days, before investor nerves were steadied somewhat by revelations that the bank had found 10 global mega banks as underwriters for its €2.5 billion rights issue, including Goldman Sachs, Morgan Stanley, Santander, Deutsche Bank and HSBC.
Anyone want to lay odds that the deal with the 10 global mega banks was already inked before the announcement that they were desperate for capital—so that the 10 global mega banks would have an opportunity scoop up some of the distressed shares before announcing their backing?
It would be really fascinating to see who was doing the buying during that 33% crash…
UK better brexit
Otherwise they have to chip in for the pigs
Chinese quality construction: http://i.imgur.com/0YsKGDE.gifv
Oh wow, that’s awesome video! I can’t stop watching it…
Gives new meaning to the verb form of “peel”. Should be required viewing for anyone crossing the San Francisco-Oakland Bay Bridge.
Do ya feel lucky? Do ya, punk?
Fremont(Seattle), WA Affordability Improves As Housing Prices Tumble 7% YoY
http://www.zillow.com/fremont-seattle-wa/home-values/
The answer to the leading question is “eventually.”
Do negative bond yields lead to negative returns?
Markets & Economy
Negative interest rates: What they are and what they mean
June 06, 2016
Negative interest rates are a confusing concept. For insight on what they are and what they mean for the economy and investors, we turned to Peter Westaway, Ph.D., chief economist and head of the Investment Strategy Group for Vanguard Asset Management, Limited, Vanguard’s European entity.
What are negative interest rates?
Typically, a central bank will have a reference or benchmark interest rate, sometimes known as the headline policy rate. It determines the rate at which banks can borrow or deposit cash with the central bank.
A negative interest rate means banks are charged when they deposit money at the central bank as part of their regular banking operations. It’s like a penalty for banks and is designed to encourage them to lend to businesses and consumers, get money moving in the economy, and fuel economic activity.
The same principle applies for investors buying negative-yielding bonds: They, like banks, are paying for the privilege of lending. A bond with a negative yield means that the interest and principal payments the investor collects as the bond matures collectively are less than the price of the bond when it was purchased.
Which central banks have set their rates below zero?
Over the last few years, a number of central banks have moved into this negative territory—the European Central Bank, the Bank of Japan, Sweden’s Riksbank, the Norwegian central bank, and the Swiss National Bank. This is new ground for central banks.
Does this mean people have to pay money to deposit in their local bank?
Not necessarily. Many commercial banks are reluctant to pass on negative interest rates to deposit accounts. But negative rates have affected some assets. Many short- and intermediate-dated bonds issued by European and governments and Japan now have negative yields.
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From the Maclean’s article:
‘Of all the statistics that demonstrate how unglued Vancouver’s house prices have become from reality, the most telling is one concocted by Vancouver mathematician Jens von Bergmann. In a recent blog post, he noted the city’s workers, from baristas to doctors, collectively pulled down about $18 billion last year in income. By contrast, he estimates, owners of single-family homes collectively “earned” about $25 billion in 2015 simply by “twiddling their thumbs” and watching the value of their drywall soar.’
‘Some Calgary homeowners are facing hefty property tax increases and say a down economy is not the time for tax hikes.’
“Over the last 10 years, a CTF reports shows that taxes and fees in the City of Calgary have increased nearly three times faster than the rate of inflation,” said Paige MacPherson, Canadian Taxpayers Federation. “But the timing right now, of course, when we see unemployment spiking, we see entire floors of office buildings in downtown Calgary sitting empty, layoffs are quite common, people can’t afford it right now.”
http://calgary.ctvnews.ca/property-tax-hikes-have-some-calgarians-seeing-red-1.2933736
‘I Lost My Savings in a Massive Chinese Investment Scam’
‘Why doesn’t the government help me get my money back?’
‘It’s hard for me to remember that just a year and a half ago, I was happy. Now everything has changed.
In July 2014, I began investing in Fanya Metal Exchange. I was 29 years old, and my aging parents had entrusted me with their savings. Over the next three months, I deposited almost all of my family’s savings, around $175,000, into the account. I hoped to find an investment with moderate returns — I wasn’t looking to get rich quick. What attracted me was the flexibility and security of the investment; Fanya promised easy cash withdrawals at any time. The company’s brochures claimed that major state-owned banks served as third-party custodians, meaning that transactions aren’t directly handled by the asset or investment manager but by a third party. I worked at a bank, so I was familiar with the relative security that this kind of arrangement can offer.’
‘But by July, I was unable to withdraw a single penny from my account.’
‘This was an almost unbearable shock. This money included my parents’ savings, earned penny by penny over a lifetime. As with many ordinary people in China, my parents have always lived very frugally, and they trusted me to manage their savings. The rest of the money I invested in Fanya was what myself and my husband have earned over the past 9 years together. My parents are almost 60 years old, and they no longer have the ability to make money. In China, it’s very risky to not have any money. If my family were to face any sudden difficulty, we couldn’t rely on the government to save us.’
‘In October 2015, I participated in a planned protest in Beijing. More than 10,000 of us planned to converge on the capital to protest and to share our complaints with the central government. If the Kunming municipal government and the Yunnan provincial governments would not help us, surely Beijing would. I spent part of what remained of my money on train tickets, hotels, and banners.’
‘But I am not stupid; I knew the risk of attempting a mass demonstration. I wasn’t afraid of arrest itself (and indeed, more than 2,000 participants were detained on their way to the protest). What I really feared was, with this country’s record on human rights, what would happen to my parents and other family members if the state got hold of them?’
‘But on Oct. 26, the day of our planned protest, the government cut off our petitioning. I was taken to a detention center in the outskirts of Beijing. There, Fanya investors from Shanxi province, also in town for the protest, told me that the police had come to their hotel late at night, knocking on doors and dragging away weary petitioners. Some were elderly, and some were even mothers with children in their arms. To this day, the government still will not hear our case. My keyboard is wet with tears right now even thinking of this.’
‘The government found out the names and hotels where many protestors were staying, but not where our money had gone. That’s what hurt the most.’
‘Now, according to public announcements in late March and early April, authorities say Fanya engaged in illegal fundraising. But it seems that no one is going to hold the state-owned banks accountable for the role they played. And when we protest and try to fight for our own rights, the government would rather spend money — our taxpayer money — hunting us down than on finding out why we can’t get our money back. I am furious, and also disappointed with my own country.’
‘Now I am targeted by the shui jun or “water army” – a horde of anonymous Internet trolls that can overwhelm email inboxes or social media accounts with an influx of messages. The messages at first sought to reassure investors that Fanya was only facing a small problem. Then they became more sinister, urging us to give up hope, and to shirk what I feel is my responsibility. I believe these messages come from government-backed web users.’
http://foreignpolicy.com/2016/06/10/i-lost-my-savings-in-a-massive-chinese-investment-scam-china-protest-fanya-ponzi/
This is an updated Vancouver chart. It’s not often you get to see a pure exponential rise. Reminds me of the Coleco cabbage patch doll stock chart of 1982.
Lemme see. Now $1.8 million , then 1.4 then 1.2 for support. A possible $600K as well for an ultimate reversion to the mean.
A slaughterhouse.
http://www.mikestewart.ca/january-2015-rebgv-vancouver-real-estate-statistics-package-with-charts
Jeebus, that graphic of detached house prices is parabolic.
Yes, parabolic it is. A logarithmic chart would not have been as severe.
It’s a mirror image of Coral Gables Florida homes purchased on the Gables waterway, so Vancouver has not cornered the market for this ominous display.
Here’s my question: The folks on the waterway are NOT speculators. Why should Vancouver and the C.G.Waterway have identical rises ? What’s the message ?
You know the answer. Fraud is omnipresent.
I don’t know details of the area. Why are the waterway people not speculators?
They’re not speculators because the properties have not been bought and then six months later placed back on the market. The few that have sold around me, after being lived in for a decade or more, came on the market because of a death or the need for assisted living.
And what did they sell for, price/sq ft?
Wow. Those charts are terrifying.
You should see the chart of fiat vacating the USD and Chinese Yen into Bitcoin.
It’s happening man.
http://fiatleak.com
You’d have to be having ColecoVisions to involve yourself in that over the top fraud.
‘Why doesn’t the government help me get my money back?’
Thank you for playing… Suck Ah.
As reported by real journalists at the New York Times:
In Silicon Valley Suburbs, Calls to Limit the Soaring Rents
http://www.nytimes.com/2016/06/12/technology/in-silicon-valley-suburbs-calls-to-limit-the-soaring-rents.html
Bitcoin burst through $600 in the last three hours. Now at $623 as of this post.
The Bitcoin train I moving.
Chew, Chew! (Chinese name, since they are doing lots of buying)
It seems like prices are on the boil in many different asset markets, both traditional and nontraditional.
Did the central banking cartel members realize they were creating market turmoil, rather than dampening it?
You’d think. I posted an interesting link below that shows live the flow of money going into BTC. Mostly people leaving the USD and the Chinese Yen.
Get with the train, it’s moving.
Yen/Yuan
I’m about to take off for a week long camp out with my sons’ Scout troop, which is led by the president of a local company that does real estate investment in China. I can’t wait to get a first-hand update regarding the situation on the ground…
Is Paul Ryan going?
If any politicians were on the camp out, I wouldn’t go.
Kihei, Hawaii Affordability Improves As Housing Prices Tumble 5% YoY
http://www.zillow.com/kihei-hi/home-values/
“It’s Happening Again: David Dayden On The Epidemic Mortgage Fraud And The Rigged Economy”
http://www.salon.com/2016/05/19/it_is_happening_again_david_dayen_on_the_epidemic_of_mortgage_fraud_and_the_rigged_economy_that_sets_it_in_motion/
We’re witnessing final assembly of the debt bomb that will wipe out “first” world economies for generations to come. Nobody will escape the fallout. The longer it continues, the more ruinous and complete the destruction will be. Only a few realize it for what it is, and fewer still dare to speak out about it. Most are blissfully ignorant, some are true believers, and the rest are willing enablers. The howls will be deafening. 2008 will seem like child’s play.
Should a got into Bitcoin and gold last year
“There’s A Crater Under Every Bubble”
http://thehousingbubbleblog.com/?p=9646
Live chart shows the flow of money coming ou of fiat and going into Bitcoin.
CNY is the Yuan.
http://fiatleak.com
This smells like an Obama regime false flag operation:
http://www.orlandosentinel.com/news/breaking-news/os-orlando-shooting-pulse-nightclub-story.html
No, it smells like a deranged individual justifying his murderous nihilism in the name of religion. C’mon, Goon. Not everything is Obama’s fault.
The initial story did not report that the shooter was an adherent of the Religion of Piece.
Another mass shooting in a gun-free zone. Can these murderous lunatics not read the signs?
http://www.ammoland.com/2016/06/florida-pulse-gay-bar-mass-shooting-was-in-a-gun-free-zone/#axzz4BNE1V8EN
“Another mass shooting in a gun-free zone.”
There goes the Standford rape case.
Meanwhile….
http://www.breitbart.com/texas/2016/06/11/obama-administration-surge-agenda-threatening-u-s-100-syrian-refugees-per-day/
With the referendum on BREXIT coming up on June 23rd, the Anglo-American elites are going to be terrified of anything that calls attention to the downside of globalism, multiculturalism, and “fundamental transformation” via unrestricted immigration.
No! It’s obviously the lizard people.
You’ve been smoking too much dope, Goon.
Get a grip.
The globalist Washington Post has wasted no time scripting this into a grabber narrative. Grabbers gonna grab, and it always happens in this order: registration, confiscation, extermination.
My mistake… it was the Crab People!
Sigh. How many times do I have to tell you, we just call them reptilians. Just plain old reptilians. No need to insult crabs or lizards.
That’s what they WANT us to think! There is a CLEAR delineation between crustaceans and reptiles, and 95% of the electorate is COMPLETELY ignorant of their agenda! WAKE UP SHEEPLE! Vaccines caus your children to grow external skeletons!
Grabbers gonna grab, and it always happens in this order: registration, confiscation, extermination.
Hey, it’s 2016. You got think about all the new things that they could be working on. May be they’ll put something in the ammo that causes infertility, so the gun people will just die off over time.
We gotta have some way to defend ourselves from your Elysian shock troops.
People who are demonstrably a potential danger to themselves or others should not be allowed to purchase or possess firearms.
Ben has recently served up a steady stream of evidence that the housing market is starting to turn again. Can the stock market be far behind?
We’ll see if the S&P 500 can break out of it’s old highs. If it can’t I read support is way down. Here something:
‘Why Valley engineers are no longer being poached for $1 million in pay’
‘Blue Jeans Network CEO Krish Ramakrishnan, who was also on the panel, agreed. “For companies with strong fundamentals, this is the best thing we could ask for,” he said. “Employees aren’t moving to unicorns offering things like free massages.”
‘He said that some engineers were being offered “CEO-like” salaries to join startups. But the crazy double- or triple-salary poaching offers have abated, he said.’
‘It just takes more convincing to get VCs to bite. Managed by Q is a 2-year old startup for office-management services in New York like janitorial services, catering, snack stocking, and office supplies.’
‘Teran has raised over $42 million, including a $25 million series B round that closed in April. One of its investors is Google Ventures who had backed a company called Homejoy, a similar marketplace for hiring cleaning and maintenance people. Homejoy closed its doors last fall.’
“Google Venture had just had Homejoy eat the dust. It had raised a ton of money and really crashed and burned. The partners in the room grilled me,” Teran recalls.’
And they wonder why there aren’t many IPOs.
“And they wonder why there aren’t many IPOs.”
It’s not about a nifty business idea, it’s about the availability of money.
Money. The driving force behind these IPOs is money.
In normal times (if there is such a thing) a good business idea will attract money.
In crazy times money will attract business ideas - whether these business ideas are good or not.
‘it’s about the availability of money’
Yeah, look at the apartment guy I posted at the bottom. “There’s a ton of money being invested.” And he mentions Fannie and Freddie are backing most of it, “more than ever before.” So if there’s all this pension fund and life insurance money, chasing yield (heck of a job Janet), why does it need a government guarantee?
Google has a great idea for putting sodas in a fridge and emptying trash cans!
They’re partying Like It’s 1999. I remember 1999 very well. Along with 2000 and 2001.
There’s a horrific reckoning on the horizon.
‘After almost 30 years in the multifamily industry, and 13 of those as an executive with global real estate investment company Kennedy Wilson, Bob Hart went on to found his own firm, TruAmerica, in 2013. Focused on renovating and repositioning mostly Class B apartments in the Western U.S., the multifamily investor and operator has a unique strategy that adds value for its investors, with more than 27,000 units under management valued at nearly $6 billion.’
‘Hart: The real estate cycle that emerged after the recession was going to have a lot of life to it, particularly for multifamily, because it wasn’t a cycle based on negativity from being overbuilt, it was under-supplied. The fundamentals were still very strong despite the downturn in the economy. I also think that’s born out now because as we’ve been moving through the cycle over six or seven years, in the apartment industry we’re seeing tremendous growth, demand and a shift in how Americans are living.’
‘Our core strategy has been renovation and repositioning of Class B. We’ve delved a little bit into Class A. We have a number of pension fund advisors who like to place capital into some higher quality product. So hopefully we’re getting in at a little better cap rate, creating value for the lease-up, and giving our investors an opportunity to diversify slightly into more of a Class A building.’
‘MHN: Why did you decide pursue a value-add strategy?’
‘Hart: That’s been my core capability for a long time. I’ve also done it for many years through my own account. I feel like the opportunities are more plentiful because you have a lot of older housing stock that needs an upgrade. By creating value-add and being vertically integrated, it gives us a competitive advantage of capability. We find buildings that are either under managed or under renovated, and lift values by repositioning them and getting higher rents as a result.’
‘I’m cautiously optimistic. I don’t know if I’d be starting brand new development right now in downtown Seattle or San Francisco, trying to target $6 to $8 dollar per foot rents, depending on the markets you’re in, or even New York. But I’m optimistic that there’s going to be continued steady growth base demand for multifamily housing in the U.S. Although the birth rate is declining a bit, you still have 3 million new people moving into the country each year, which creates a tremendous amount of household demand. Plus you have housing stock that comes offline and the expansion of households becoming smaller. Overall, the shift is happening long term in multifamily. I think it’s not a cycle of innings nor a cycle of gains, but a cycle of seasons.’
‘There may be dips in the real estate cycle based on cap rate or investment enthusiasm, but I don’t think that’ll affect long term the demand for multifamily product. Probably not since the end of WWII have we seen this much demand for housing, particularly multifamily, and I think it’s going to continue.’
‘In terms of investment, I think there’s more foreign capital coming in. You’re seeing in real estate and in the financial markets, people are seeking yields in the low-interest-rate environment.’
‘MHN: Are there any trends or challenges you’re noticing in the industry?’
‘Hart: We have two agencies that provide most of the financing, Fannie and Freddie, more than they’ve ever been. There’s a ton of banks out there lending. There’s tremendous amount of equity and liquidity in the market, and great rental demand. I think there’s a little element of cautiousness. Can this keep lasting? Can people continue to afford rising rents? You see that published more and more because a lot of the middle class is disgruntled that have been left behind in the recovery. The biggest challenge in growing the overall economy, let alone the rental economy, is affordability. That’s probably the number one threat: maintaining peoples incomes at a level that can sustain rental growth.’
‘I think it’s not a cycle of innings nor a cycle of gains, but a cycle of seasons’
Watch out for that tree, Mr New Paradigm.
He doesn’t seem to understand that a key fundamental element of “growing the economy” is falling prices to dramatically lower and more affordable levels.
Guys like him end up crashing and burning and causing massive losses for a lot of people in the process.
‘The biggest challenge in growing the overall economy, let alone the rental economy, is affordability’
Says the guy whose business model is taking lower priced apartment and turning it into more expensive apartments. “Can this keep lasting?”
His words are proof and it’s right there in front of everyone yet most people miss it.
‘Multifamily Spring Report 2016: An influx of Millennials and strong job growth have propelled apartment rent increases in Denver to among the highest in the nation.’
‘But that growth may be hitting a wall as a result of the heavy development pipeline. The heavy new supply, mostly concentrated at the higher end of the spectrum, is outstripping demand and dragging the market down far below last year’s 13% growth rate. This increase in supply is unlikely to persist for several years, as more than 21,000 units are currently under construction and another 25,000 in the planning stages.’
Just imagine how many construction jobs will be going away.
Eventually supply will outstrip demand, particularly when SFHs with more privacy and amenities are cheaper to rent than apartment units. It will happen.
Look who is playing the Godwin’s Law card at this late stage in the Presidential race:
Prominent Republicans are playing it.
It seems that Trump’s campaign is imploding, thanks to his stubborn refusal to pivot away from being Donald Trump. Got popcorn?
Meg Whitman Likens Donald Trump to Fascists, Shaking G.O.P.’s Brief Truce
Meg Whitman, the chief executive of Hewlett Packard Enterprise, at an event for Gov. Chris Christie of New Jersey in February. On Friday, Ms. Whitman compared Donald J. Trump to Hitler and Mussolini during a Republican retreat in Utah.
Cheryl Senter for The New York Times
By ASHLEY PARKER and MAGGIE HABERMAN
June 11, 2016
A tenuous peace in the upper echelons of the Republican Party showed signs of unraveling this weekend as a major donor compared Donald J. Trump to Hitler and Mussolini, Mr. Trump and Mitt Romney reignited their feud, and one of Mr. Trump’s aides took a shot at an important campaign ally.
Meg Whitman, the chief executive of Hewlett Packard Enterprise and a major contributor to Republican candidates, railed against Mr. Trump on Friday at a closed-door meeting of Republicans in Park City, Utah, comparing him to the Axis leaders, according to several people in attendance who declined to be identified because the discussion was private.
The comments, first reported by The Washington Post, came at Mr. Romney’s annual retreat of Republican donors, leaders and business executives. Mr. Trump’s candidacy, and the divisions it is causing among leading Republicans, was an undercurrent of the gathering. Mr. Romney has been outspoken in his refusal to support Mr. Trump, the party’s presumptive presidential nominee, even as other party figures have grudgingly fallen into line.
No one has personified the party’s divisions like Paul D. Ryan, the House speaker, and the pressure on him intensified this weekend. At the Utah retreat on Friday, Campbell Brown, a former CNN anchor, pressed Mr. Ryan on his decision to support Mr. Trump, according to an attendee, saying she did not know how to explain it to her children.
…
‘Prominent Republicans are playing it’
They were the ones that said that initially. They’ve got nowhere to go. I heard yesterday that Trump won 66 of 67 counties in Florida in the primary. This morning, with ISIS celebrating another mass shooting, how many of those voters are thinking about Whitman, versus thinking about slowing down unvetted immigration from Syria?
Fair enough.
I just found it amusing that Republican leaders would liken their candidate to Mussolini and Hitler.
It wasn’t that long ago they were telling us they pick the nominee, not the voters.
LOL, Republican “leaders”. A buncha sorry sad sacks sucking their thumbs and whining because the war machine is slipping through their fingers.
Here’s a thought: they’re not Republican leaders any more, if they ever were in the first place. It’s Trump’s party now. He’s accomplished a hostile takeover. Let ‘em go somewhere else, they belong with the coalition of the fringes.
Here is the news: Their war machine is not slipping through their fingers. How many Trump supporters have been protesting war? Have you seen anti war signs at Trump,rallies?
I’ve seen the neocons go over to Clinton.
‘they’re not Republican leaders any more’
This is closer to reality. Why is the media listening to Romney, who lost to that loser McCain? These guys and gals can pow-wow with their billionaire buddies at posh resorts over and over, “plotting” all they want. They are out, “looking through the glass like under sea” as Kerouac said.
‘Here we go again. Earlier this year, some were surprised to see Project For The New American Century (PNAC) co-founder and longtime DC fixture Robert Kagan endorse former Secretary of State Hillary Clinton for president.’
‘They shouldn’t have been. As is now clear from a policy paper [PDF] published last month, the neoconservatives are going all-in on Hillary Clinton being the best vessel for American power in the years ahead.’
‘The paper, titled “Expanding American Power,” was published by the Center for a New American Security, a Democratic Party-friendly think tank co-founded and led by former Undersecretary of Defense Michèle Flournoy. Flournoy served in the Obama Administration under Defense Secretary Leon Panetta and is widely considered to be the frontrunner for the next secretary of defense, should Hillary Clinton become president.’
‘The introduction to Expanding American Power is written by the aforementioned Robert Kagan and former Clinton Administration State Department official James Rubin. The paper itself was prepared in consultation with various defense and national security intellectuals over the course of six dinners. Among the officials includes those who signed on to PNAC letters calling for the overthrow of Saddam Hussein, such as Elliot Abrams, Robert Zoellick, Craig Kennedy, Martin Indyk, Dennis Ross, and Flournoy herself, who signed on to a PNAC letter in 2005 calling for more ground troops in Iraq.’
‘The substance of the document is about what one would expect from an iteration of PNAC. The paper cites a highly revisionist history of post-World War II American policymaking, complete with a celebration of America’s selfless motives for every action. Left out is any mention of overthrowing democratically elected and popular governments for US business, or the subsequent blowback for such actions in Latin America, the Middle East, and elsewhere.’
‘The paper primarily focuses on the economy and defense budget, and American security interests in Europe, Asia, and the Middle East. Supporting the Trans-pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP) are considered the highest priority, as they will bind the main drivers of the US-led “liberal world order”—the US and Europe—closer together.’
‘But the overriding concern of the entire paper, with all its declarations about bipartisanship and universal altruism, is a concern with the American people being increasingly apprehensive towards the empire, and that concern leading to further defense budget cuts and unwillingness to support adventurism abroad.’
‘That this is what a think tank closely associated with Hillary Clinton is openly claiming should be concerning to all. While such analysis and declarations no doubt please the Center for a New American Security’s defense contractor donors, the American people are less-than-enthused with perpetual war for perpetual peace.’
‘Former Secretary Clinton already affirmed her belief in regime change during the campaign, but now it looks like those waiting in the wings to staff her government are anxious to wet their bayonets.’
“Their war machine is not slipping through their fingers. How many Trump supporters have been protesting war?”
Trump supporters have a way of ignoring what Trump does and says he is going to do as they go wild with ad hominem attacks on anyone who happens to be of the wrong race or religion or doesn’t kowtow to Trump’s menacing vitriol.
I know Trump supporters. I have them in my family. They post the silly memes chanting “thank you for defending my freedom” They think ISIS has nothing to do with Israel, McCain, Saudi Arabia.
Gee, that’s not what we saw in San Jose. We saw all the “right” people attacking and bloodying Trump supporters like feral pack animals bringing down their prey.
https://www.youtube.com/watch?v=YSdnTtA-R4I
You must’ve been so proud.
‘We saw all the “right” people attacking and bloodying Trump supporters like feral pack animals bringing down their prey.’
Off topic and irrelevant… typical Trumpthink.
What does that San Jose video have to do with Selfish Hoarder’s comment above?
I was responding to PB. It’s very relevant, it just doesn’t fit your narrative. That’s what’s in store for many of us if we don’t do something about it.
PB, you are frothing at the mouth, throwing spittle, and going off the rails again.
The definition of Fascism is government controlled by corporations. That is what we have with the Clintons. Mitt is, IMHO, demonstrating narcissistic rage.
Go easy on da bear. Because there’s a very real possibility that the ME student spigot is going to get shut off very abruptly. Which would be a disaster for the academic tenure ponzi.
Buh-bye San Diego, St. Louis I’m comin’ home!
Maybe I can get a new job at Trump University.
Oh wait… I lack experience in scamming greater fools into overpaying for overpriced real estate. Never mind…
“PB, you are frothing at the mouth, throwing spittle, and going off the rails again.”
You are doubtless the most qualified HBB reader to judge these behaviors, as they are embodied in every post you make.
I can’t understand why people like Whitman and Romney are so ferociously defending a Republican establishment that has done nothing for them. Meg was a good candidate for CA governor. She still lost, big-time. Romney wasn’t a bad candidate either (at least he was better than some of the others), and he lost. So why are they defending an establishment that caused them to lose elections by huge margins and millions of their own dollars in the process? It makes no sense.
You have it backwards. The establishment helped them to run for office by giving them the endorsement of the party. It was rejection by ordinary people that resulted in their losses.
Well, Mike, you and I don’t often agree, but I have to hand it to you, you just nailed it.
Sigh, the simplest answer is that you just can’t fathom insanity, so don’t even try. Logic breaks down when you do so, just like these people are having breakdowns. I think they, like many, believe that money conquers all, and they’ve just been faced with the stark recognition that it’s not always true and they can’t handle the truth. In fact, if I may be permitted a small play on words, ideas trump money, ideas can defeat armies.
Trump actually nailed it at his Tampa rally. He spoke about how he has to fight his own party and said even the Democrats aren’t this bad.
After the 2012 election, there was talk on some of the political forums how the Republican consultants deliberately scuttled Romney’s election chances. The question was, was Romney on board and in agreement with this, or was he oblivious to it, allowing himself to be massaged into thinking that all was well and he was going to win? We concluded that, based on his rather dumbfounded reaction when he lost, that he was unaware of what had been done. Don’t forget, win or lose, the consultants make money, and lots of it.
The next question that came up was, was Romney in fact being used as a placeholder for Jeb!, and in the aftermath of the election loss, had he realized it? Hard to say, he was awfully quiet over time. Then it seemed that perhaps he had an inkling, when JEB! declared his candidacy. It seemed to blindside Romney, who clearly didn’t expect it. And then he started to make his own attempt at a comeback, talking to donors and such, many of whom basically said, “Gee, sorry, Mitt, but we’re with JEB!” This was followed by the famous closed door meeting Romney had with JEB!, after which he went quiet. We figured by that time he knew what the score was.
I’ve come to the conclusion that for all his supposed wealth and “successful” business dealings, Romney is not the sharpest tool in the shed. And again, he did a better job of instituting Democrat policies in Massachusetts, on gun control and insurance, than any Democrat governor would have done. He’s not a Republican, he’s basically a neoliberal and really not very bright. The cream of the crop. Thick and rich.
So here’s a interesting tidbit back from my hometown in the Hampton Rds VA region. In a twist of irony, the local major developer/project company, Armada Hoffler, the owner is listing his mansion for $13.99 million, after it was originally listed/suggested for $42 million, in the height of the market!!
This guy has greased the local government of Virginia Beach, and has his hands in almost every project (venues, “downtown/Town Center”, hotels). The current mayor, investigated by the Feds for possible conflict of interest, served as president of Town Bank finance, who happens to be the principal financer for alot of the Hoffler properties/projects…
$13.9 million mansion
“He put the property back on the market in October for $13.99 million and said he won’t sell it for any less.”
Geez. All those bids for $13.98 million that were rejected !
$13.98 million in an area thats built off active duty military and DoD contractors…aka not much money, everything is pretty level income wise, aside from the occasional wealthy developer, dentist, doctor, etc.
The housing market is in a pickle. But I’d rather ride on my motor-sickle….
http://www.businessinsider.com/the-housing-market-is-trapped-2016-6
‘Here’s Fleming’s breakdown: “Why sell your home and buy a home when one, there’s not a lot of choices in a home to buy - a little bit of a chicken and an egg problem there - but right now there’s so little inventory to choose from. Secondly, a majority of existing homeowners have a mortgage rate of 4.5% or less. There’s very little financial incentive because all I have is a big lump of transaction costs to move.”
“Whereas in times past, the move up process was incentivized by the long-run trend in falling interest rates. Every three to four years, interest rates were lower than they were a few years ago and so yeah sure, I’ll move, because I can buy my proverbial ‘own home’ back at less monthly cost because rates are lower. There’s no incentive for that, rates have hobbled at 4% or less than 4% for almost 2 years now, 80% roughly have a mortgage rate at 4.5% or so. I don’t see the financial benefit to moving if it’s going to cost my 6% commission and moving fees.”
In keeping w the” smarter than” theme
I wonder how the Palin’s made on their flips
If u r smarter than trumpf u must be way smarter than Palin
trump just won the election because of the incredible mass shooting at a gay club by a radical muslim…..unless oh biden hillrie change 180 degrees and admit this, but then it would tick off the leftist liberals…oh yeah we need tougher gun control too.
Milo Yiannopoulos will be all over this.
A few other British and Canadian right wing bigots are already working on new YouTube videos.
Bigot, bigot, piggit in a spigot. Bigotty spiggoty poo, on you, if you can’t dance too.
“A few other British and Canadian right wing bigots are already working on new YouTube videos.”
Oops, before I forget: “This message brought to you by The Southern Poverty Lie Center”.
“A few other British and Canadian right wing bigots are already working on new YouTube videos.”
Is this information coming from your office?
The talking points are taped to their computer monitors when they clock in for their AM shifts.
Is this information coming from your office?
What the heck are you going on about? Bill DaWahl said that that one British right wing clown is sure to make dopey comments about this hate crime. I chimed into say that there will be others.
Yup:
http://www.breitbart.com/milo/2016/06/12/left-chose-islam-gays-now-100-people-killed-maimed-orlando/
So are you suggesting the false flag event in Orlando was set up to make Trump win this November?
not sure but the timing is interesting if it was some KKK member it would be justification for more anti hate and gun legislation from the left….but Islam…that’s trumps card!
https://m.youtube.com/watch?feature=youtu.be&v=QynchCojTzM
Problem, reaction, solution.
ABSCAM. https://en.wikipedia.org/wiki/Abscam
Heh, it occurs to me that the head that will roll for this will be the director of the FBI, James Comey. Already the media has mentioned that the FBI investigated the shooter three times already, with no further action.
Just as the FBI is closing in on Clinton, and the leaks are starting to trickle out. Boom! Comey’s gone. How convenient.
There’s your false flag.
ohbewanna fails to mention islam…….http://www.chicksontheright.com/obama-addresses-nation-on-orlando-terrorist-shooting-doesnt-mention-islam/
Killer was a registered Demoncrat going back to mid-2000s, before Trump as a pol was even a thought.
Demoncrat killer also employed to transport illegal OTMs (Other than Mexicans) around the country. Think he hooked them up with guns/bombs/etc? FBI investigates multiple times, nothing to see here says officer barbrady.
Smells like another Fast and Furious type operation (San Bernadino being another example) has come home to roost once again in our country. Thx Dems!
Obama and other members of his regime, including Hillary, have committed treason, pure and simple.
Had to laugh at Obama’s statement - We have to look at our attitudes towards LGBTQASFSDF. Thats funny, I thought it was a muslim nut job that did all the killing, but lets ignore that fact and blame Our attitudes towards the victims. Say what? Stupid regressives all echoing similar crap right now. Can you imagine if this was a Christian church that got shot up? They would blame the victims for inciting the violence, like they did those who have been attacked at Trump rallies. Truly sick people.
I doubt it. It will be forgotten in less than a week and Trump will open his mouth and be the center of unwanted attention for weeks to come. That guy just can’t help it. He’s his own worst enemy.
What, you’re all butthurt about the judge comments? Hey, guess what, he was right, the guy IS a Mexican and an anchor baby at that.
http://gotnews.com/ay-carumba-death-certificate-papa-judgecuriel-proves-new-york-times-lying-u-s-citizenship/
Surprise, surprise! Papi’s death certificate, right there for all to see!
“In fact Salvador Curiel never received U.S. citizenship and Francisca became a citizen in 1969–five years after her husband died and 18 years after her last son — the future judge Gonzalo Curiel — was born.
So the New York Times got it wrong. They didn’t do their fact checking. Oops.
Could the fact that Mexican telecom billionaire Carlos Slim’s ownership of The New York Times have played a role?”
Looks like one of those dual citizenship things. Lest we forget, the New York Slimes helped lie us into the Iraq War. How’d that turn out?
Curiel is in gross violation of rules governing the judiciary. Where’s the MSM on this? Crickets.
“Ay Carumba!”
Bitcoin up 15% in 24 hours. And the worth of your house increased by what in 24 hours?
Another bitcoin question, por favor. What say you about the transaction time? How do you see that being resolved going forward?
Also, have you looked at blockchain as a way to reduce fraud in electronic voting? I think the potential is there - but of course certain pols would never allow such risky, unproven technology to put democracy at risk, lol!
TIA
Washington Park(Denver), CO Affordability Skyrockets As Housing Prices
Cave 22% YoY
http://www.zillow.com/washington-park-denver-co/home-values/
Well, well, well, what have we here?
“In a surprising discovery, the Palm Beach Post first reported that according to state records, Orlando shooter Omar Mateen - who as we reported earlier was licensed as a security guard and also holds a firearms license - was employed by the US subsidiary of G4S plc, a British multinational security services company, whose US-headquarters are located in Jupiter, Fla, and which also happens to be the world’s largest security company by revenue.”
“But where it gets more disturbing is that as Judicial Watch reported several days ago, in a post titled, “DHS Quietly Moving, Releasing Vanloads Of Illegal Aliens Away From Border”, border patrol sources said that the Department of Homeland Security (DHS) was quietly transporting illegal immigrants from the Mexican border to Phoenix and releasing them without proper processing or issuing court appearance documents. As a reminder, the government classifies them as Other Than Mexican (OTM) and this week around 35 were transferred 116 miles north from Tucson to a Phoenix bus station where they went their separate way. Judicial Watch was present when one of the white vans carrying a group of OTMs arrived at the Phoenix Greyhound station on Buckeye Road.
And this is where the Mateen-G4S link emerges: as JW reported previously, a security company contracted by the U.S. government is driving the OTMs from the Border Patrol’s Tucson Sector where they were in custody to Phoenix, sources said. The firm is the abovementioned G4S, the world’s leading security solutions group with operations in more than 100 countries and 610,000 employees. G4S has more than 50,000 employees in the U.S. and its domestic headquarters is in Jupiter, Florida.
Judicial Watch noted that it had filed a number of public records requests to get more information involving the arrangement between G4S and the government, specifically the transport of illegal immigrants from the Mexican border to other parts of the country.”
http://www.zerohedge.com/news/2016-06-12/orlando-shooter-worked-security-company-which-tranports-illegal-immigrants-deep-insi
Step down, Obama, step down NOW. And take your f’king boy Jeh and your girl Hillary with you. Friggin’ leave the country and go into permanent exile.
A bitcoin bubble is unpossible!
Since a lot of this recent bitcoin price appreciation is due to Chinese speculator purchases, another crash is only a question of when, not whether.
Bitcoin Price, Market Cap Reach 2 Year High
Market Cap
Written by: Tyson O’Ham
2016/06/12 7:55 AM
Bitcoin’s price has surged up nearly 11%, past the 600$ mark since last night’s round of trading, coming to rest near the $640 level at the time of writing. The market cap has reached 10 Billion US Dollars coming into the morning. This puts Both price and Market Cap at the highest it’s been in a little over two years. While mo st of the top Cryptos have enjoyed growth over the past few weeks, Bitcoin has taken a more-than-proportional share of new Cryptocurrency buy-ins.
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crushing.housing.losses.