August 21, 2016

Irrational Exuberance At Its Worst

A report from Bloomberg. “Chinese authorities said 450 suspects have been arrested this year in a crackdown on using offshore companies and ‘underground banks’ to transfer money illegally, underscoring the scale of the task for officials trying to control capital flows. The cases involved almost 200 billion yuan ($30 billion) of transactions, the Ministry of Public Security said in a statement on its website. A net $55 billion exited in July, compared with $49 billion in June, Goldman Sachs Group Inc. analysts wrote in a note. Outflows surged during the second half of last year, rising to as high as $171 billion in December, according to a Bloomberg estimate.”

NewsHub on New Zealand. “A Chinese-New Zealand real estate agent says some foreigners are buying Auckland property purely for profit. Adam, who did not want his surname revealed, has worked in real estate in Auckland for almost four years. ‘A good proportion of foreign buyers come here as speculators. They think the New Zealand housing market is very hot and the price may be in their opinion still under-valued. So they come here to buy and they have an intention to sell,’ he says.”

“He says he felt so strongly about the issue he emailed NZ First leader Winston Peters, who today put out a press release quoting Adam. ‘The agent said many foreigners did not pay tax, bought and sold through their own circles and would sell in bulk and abandon New Zealand if there was a downturn in property values,’ says Mr Peters.”

“He admits his comments around the Auckland housing market are not based on fact, but rather his dealings with foreigners in Auckland. ‘A good proportion of Chinese, they come here with bags and bags of cash. I am dealing with a lot of foreign buyers and many of them come here to buy property, to live in New Zealand with an intention for education or business, but some of them come here for investment purposes.’”

The New Zealand Herald. “It’s tempting to join the chorus of sinophiles who slapped ‘Adam’ for suggesting Chinese speculators were building the Auckland property bubble. But the spectre of large-scale money-laundering through cash buys in the Auckland market - which the anonymous real estate agent also raised - must be investigated. It must not be simply swept under the carpet while the Government meanders slowly towards cracking down on the estimated $1.3 billion of ‘dirty money’ washed through New Zealand each year.”

“The Chinese agent - who wrote an article in Monday’s Herald and spoke with radio host Duncan Garner - painted a disturbing picture. ‘Adam’s’ claims were evocative: ‘I remember seeing young couples with their hands clenched and eyes glued to the auction screen, only to find their first dream house outbid by someone screaming in Mandarin. And I shudder to imagine their feeling when they see the very house they missed out on back on the market within a couple of months with 200k added on top … meanwhile, a champagne is uncorked at another New Zealand property expo in China.’”

“This is because while the property market has been reflecting an exhilarating population growth, it is also fuelled by the widespread assumption that ‘the Chinese pay the most’. It is irrational exuberance at its worst.”

The Daily Mail on Australia. “Chinese buyers are increasingly dominating home auctions as they race to get on the property ladder soon after arriving in Australia. Such is their enthusiasm that in some suburbs it is rare to find house hunters of other nationalities bidding on family homes, even in crowds of 50 or more. All but one of seven auctions Daily Mail Australia visited in Sydney’s northern suburbs this weekend was won by a Chinese bidder, with one home only contested by Chinese buyers.”

“Kitchen supplies wholesaler Andrew Shen was one of dozens of bidders for a four bedroom house in Epping that sold for $1.8 million on Saturday. The 26-year-old, who moved from Jaixing, near Shanghai, in 2010 and is now an Australian citizen, was looking to move his new family out of their cramped flat. He said he had been house hunting in the area for more than two months and had his heart set on the brick home next door to West Epping Park, but was priced out by another Chinese buyer.”

“‘I think this price was a bit too high for the market. It was incredible, crazy. I hope I can find another one,’ he said. ‘I’ve worked so hard to get money and buy a home for my family.’”

“Mr Shen first came to Australia to study at university, following his older sister who moved years before, and was soon joined by his parents. He is now married with a five-month-old daughter and his parents and sister now own property in Sydney, and came to the auction to support him. Like many young Chinese homebuyers, he got help from his parents to buy his first property – a flat nearby he acquired in 2014 – but said he had to finance the new house himself.”

“‘I have to work very hard to hopefully get a big house, that’s my dream. I hope it comes true,’ he said, adding that he also planned to keep the flat as an investment.”

Domain News in Australia. “The Hunters Hill trophy home of Cate Blanchett and her husband Andrew Upton is set to return to the market after the buyer was forced to default given problems getting their funds out of China. The historic residence, Bulwarra, made headlines when it sold for $19.8 million last August, not only because of its high-profile ownership, but because the sale came less than three weeks after it hit the market. Property transactions at this level usually involve a 10 per cent deposit, which represents a $1.98 million loss for the Chinese buyer.”

“The Hollywood A-listers exchanged on the sale of their historic home a year ago and have since moved to the United Kingdom. Earlier this year China started forcing its state-owned banks to delay or block large sums of money going overseas. By law, individuals in China are restricted to moving the equivalent of $US50,000 out of the country each year.”

“Foreign buyers relying on finance from Australian banks hit a roadblock in May this year when the big four started clamping down on loans obtained based on overseas income. Property developers have reported concerns with smaller-priced investments to foreign buyers defaulting as a result of the crackdown on foreign capital outflows from China.”

“Until now the trophy home market was said to be immune to the moves because buyers at that level usually already have their money in offshore accounts.”

The Australian. “As buyers returned to the Sydney dwelling market over the weekend, taking auction clearances to a one-year high, on the other side of the Pacific in Vancouver, prices are down 20 to 30 per cent. Vancouver, Sydney and Melbourne are, in a strange way, ’sister’ cities because all three have been subjected to unprecedented Asian buying of domestic real estate, which has sent prices so high that young locals are being priced out of the market.”

“So, what has happened in Vancouver in the last three months is of vital interest to the Sydney and Melbourne real estate markets. Two blows have hit Chinese buyers of Vancouver real estate — the increasing difficulty of moving money from China and the implementation last month of a 15 per cent property tax by the provincial government of British Columbia.”

“Both Victoria and NSW have imposed property taxes on foreign purchases but nothing on the scale of what was imposed in Vancouver (in Sydney it is being levied at 4 per cent of the purchase price). Before the tax came into effect, Vancouver experienced the same developments that we saw in Sydney and Melbourne — such as deals falling through as foreign buyers forfeited deposits on binding deals.”

“Then the Vancouver market received an extra blow — local buyers began withdrawing offers in expectation that the market would soften. Volume slumped dramatically. While August is typically one of the slowest months for real estate transactions in Vancouver, the number of homes sold during the first two weeks of August in Greater Vancouver dropped by 85 per cent on average.”

“Solo, a Canadian real estate brokerage house, reports that the City of Vancouver currently has an average apartment price of $1.1 million, down 20.7 per cent over the last 28 days and down 24.5 per cent over the last three months. Real estate experts say that the foreign buyer tax has certainly stopped speculative buyers. This has caused many other buyers to take a wait-and-see approach, which has essentially frozen the market. Australia is not experiencing such a development but if the Vancouver slide continues, it should raise property alarm bells around the world.”

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Comment by Ben Jones
2016-08-21 18:07:41

‘Property transactions at this level usually involve a 10 per cent deposit, which represents a $1.98 million loss for the Chinese buyer’


Comment by ahansen
2016-08-21 23:43:00

Enjoy them while you can, they’re disappearing fast (and unextended).

Comment by oxide
2016-08-22 05:42:39

Welcome back! :grin:… how are uu doing?

Comment by The Selfish Hoarder
2016-08-22 08:06:04

ahansen, you’d love this place now, HBBers became authoritarian worshippers over the last 12 months.

Comment by Ben Jones
2016-08-22 08:19:42

I allow posters to say stuff like “put a wall around the human trash”. This serves to show the character of these individuals. Like when you are anonymously passing judgement on others for choices they may or may not make. We used to agree on a few things here; one was generalizing is almost always an error. I for one am thankful for all the people who visit this blog and contribute their time and thoughts. I also don’t believe any human is trash. Including you, not matter how ungrateful you are for the use of my bandwidth.

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Comment by The Crushin' Russian
2016-08-22 08:27:42

And the ironic truth is Wallyworld is all they can afford. Not much of a choice.

Comment by redmondjp
2016-08-22 10:09:40

No, it’s even worse than that, HA: they can’t even afford to shop WM any longer - it’s the dollar stores now, where you can buy all the past-the-best-by canned food that you want.

Comment by The Crushin' Russian
2016-08-22 10:48:00

Resulting in collapsing demand, just like housing.

Remember…… Nothing accelerates the economy and creates jobs like falling prices to dramatically lower and more affordable levels. Nothing.

Comment by The Crushin' Russian
2016-08-21 18:22:49

So much for the ‘cash buyer’ narrative.

Comment by azdude
2016-08-22 05:06:40

smart, leveraged money! LMFAO

Comment by The Crushin' Russian
2016-08-22 05:51:19


Comment by Senior Housing Analyst
2016-08-21 18:36:04

Stratford, CT Housing Prices Crater 10% YoY As New England Enters Housing Correction

Comment by Ben Jones
2016-08-21 18:53:44

‘Despite the best efforts of the banks and regulators, the flood of Chinese money into Australian residential property doesn’t seem to be showing signs of slowing — yet. Two charts released this week in a research note from ANZ tell the story. The first shows data from the Foreign Investment Review Board, breaking down foreign investment approvals by country — not surprisingly, Chinese nationals accounted for the vast bulk last year.’

‘According to FIRB’s latest annual report, the value of approvals for foreign investment in Australian real estate increased 75 per cent last financial year to $61 billion, with Chinese accounting for around two-thirds of applications.’

‘In June, UBS economists noted that the “willingness to lend against foreign income reportedly tightened this year”. “This is leaving lingering worries over the prospect of ‘settlement risk’, particularly as high-rise apartments will have record completions in coming years,” UBS wrote. “However, this is likely to be an issue if prices fall substantially between when the deposit was paid and when settlement is due.”

‘A bigger risk to Chinese demand for Australian property than tighter lending could be a crackdown on money transfers out of China. In the same report, UBS warned the “fat tail of a bad outcome remains” if China sharply tightens capital flows.’

‘Under current regulations, mainland Chinese individuals can change up to $65,400 ($US50,000) in foreign currencies per year, fuelling demand for ways to skirt the limits as investors, fearing a falling yuan, seek to stash capital in overseas markets.’

“Underground money shops are a scaled business now in China, and there are hundreds, if not thousands, of shell companies with the sole purpose of getting money out of China,” Renmin University finance professor Zhao Xijun told the paper.’

‘The shops operate in effectively the same way as legal peer-to-peer foreign exchange marketplaces such as CurrencyFair or TransferWise. According to China’s Ministry of Public Security, suspects would transfer money out of China by asking the client to put the funds in a domestic account, with an agent overseas instructed to inject an equivalent amount into an overseas account specified by the client, depending on the exchange rate.’

‘Chinese official Luo Yonglong, deputy director of supervision with the State Administration of Foreign Exchange, told the South China Morning Postthe use of underground banks had created a monetary “black hole” that undermined government economic policy. “The damage is obvious,” Luo said.’

‘The volume of homes being taken to market is lower. There were 1,444 properties listed for auction last week, down by a whopping 32 per cent from 2,118 on the corresponding week of last year. Even taking the higher clearance rate into account, that still means a sharp drop of about 29 per cent in the number of homes sold.’

‘And the seasonal glut of homes has yet to hit the market: last year, between mid-August and early December, the number of homes going under the hammer rose by 76 per cent. The test of the market’s resilience is not how it copes with the relatively small number of auctions held in late winter, but whether it stands up to the seasonal flood of supply — set to peak a little over three months from now.’

Comment by Ben Jones
2016-08-21 18:57:14

‘Chinese police have this year uncovered $30 billion worth of illegal banking activity, involving 158 cases of underground banks and money laundering, the official Xinhua news agency reported the ministry of public security (MPS) as saying late on Tuesday. A special task force, jointly launched by the MPS, central bank, and foreign exchange regulator, uncovered illegal banking services in 192 locations, the report said.’

‘The crackdown included the investigation on the country’s biggest underground banking case that handled $64 billion worth of illegal transactions. Although the crackdown has curbed underground banking to some extent, illegal activities using those “grey capital” networks are still spreading and becoming more elusive, the report said.’

‘Underground banks are channels for transferring money obtained through illegal activity, including public funds embezzled by corrupt officials, it added. “Criminal activities by underground banks are still rampant. There is increasing collusion among underground banks in different regions,” Xinhua reported.’

Comment by snake charmer
2016-08-22 08:33:53

Sometimes I wonder about the people caught up in these alleged crackdowns by Chinese authorities. Could it be that the transgressing individuals simply lack solid political connections, and/or have been deemed expendable in order to present a façade of legitimacy to the world? I’m reminded of the Latin American drug smuggling tactic where a few mules are double-crossed so as to generate positive press and statistics, while the trade and its associated corruption continue as before.

The Chinese Politburo consists largely of billionaires. In a communist country, LOL. Somehow I don’t think they’ll be affected by the crackdowns.

Comment by In Colorado
2016-08-22 09:52:54

There is no doubt that some are more equal than others, and that those who are less equal get busted.

Comment by snake charmer
2016-08-22 10:48:19

I’ve recently seen several articles suggesting that the Chinese model is not only successful, but one the U.S. should emulate. Perhaps this is part of the “democracy isn’t working any more” trial balloon increasingly being floated by our dissolute elite, now that the masses no longer trust their leadership.

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Comment by MightyMike
2016-08-22 11:00:03

The elites have been pushing that for a long time. When you hear the idea that the founding fathers established a republic, not a democracy, what’s being promoted is the idea that the rich and big business should run the country with little interference from the 99%.

Comment by Prime_Is_Contained
2016-08-22 20:27:35

I’ve recently seen several articles suggesting that the Chinese model is not only successful, but one the U.S. should emulate.

This message brought to you by your Politburo.

Comment by drumminj
2016-08-23 10:31:26

Hey Prime…you still at the same gig? Cool if I ping you? Thinking of trying something different…

Comment by Prime_Is_Contained
2016-08-23 20:36:46

Yep, feel free to ping me, drummin!

Comment by TheCentralScrutinizer
2016-08-21 20:35:41

I just saw a political ad for an American candidate, with narration in Chinese and subtitles in English. Might have been a Canadian candidate… it was the leader ad into a Tragically Hip song on youtube.

It kind of freaked me out.

Hold me. I’m scared.

Comment by Ben Jones
2016-08-21 20:50:57

‘Hold me. I’m scared’

A real winner with the ladies. You can always suck your thumb.

Comment by TheCentralScrutinizer
2016-08-21 21:16:56

The ladies love a sensitive man. The reason mankind had a leap of intellect about 10000 years ago is because the nerd cavemen that were crap hunters stayed home from the hunt and fathered all the children.

It’s all true… study it out!

Comment by Ben Jones
2016-08-21 21:21:55

Well don’t shiver in the night with fear because you saw an ad, scary-d cat. Good luck with the crap hunt.

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Comment by In Colorado
2016-08-22 11:42:12

The ladies love a sensitive man.

Don’t be a beta bux!

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Comment by oxide
2016-08-22 05:53:54

The ladies love an emotionally sensitive man. But sensitive in the logistics of living? Not so much. e.g.:

“Hold me I’m scared of losing you” works.
“Hold me I’m scared our child is sick” works.
“Hold me I’m scared of being lonely” works.

“Hold me I’m scared of dying in a war” probably works.
“Hold me I’m scared of losing my job” works — if the job loss is beyond his control.

“Hold me I’m scared of losing my job because I suck at my job” does *not* work.
“Hold me I’m afraid I gambled away our life savings” does *not* work.

Comment by The Crushin' Russian
2016-08-22 06:12:17

Hey Donk.

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Comment by TheCentralScrutinizer
2016-08-22 08:23:55

That was more of a “Hold me, my continent is being invaded by Chinese, and my fellow continent dwellers are selling out as fast as they can.”

Not sure where that falls on your spectrum… but I’m spoken for anyway.

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Comment by oxide
2016-08-22 09:07:21

Probably on the Hold me I’m scared I’ll lose my job and it’s beyond my control.

I’m not going to speculate on what works in the privacy of your home.

Comment by cactus
2016-08-22 09:30:41

That was more of a “Hold me, my continent is being invaded by Chinese, and my fellow continent dwellers are selling out as fast as they can.”

yea its obvious on the coast plus working in High Tech. Chinese need at least 4 homes ( heard this in Santa Clara last week kind of a joke )

They like buying them and then renting them out to section 8

All you flyover who think you’re immune think again they are not buying 4 homes in Silicon Valley.

Will this trend last ? I think so yes after all the US is kinda broke and needs money so ..

I think it will cause big price run ups and spectacular crashes over and over again.

Comment by The Crushin' Russian
2016-08-22 09:56:45

That’s the end result of dumb.borrowed. money. Spectacular crashes.

Comment by Professor Bear
2016-08-22 01:36:24

More good news on improving oil price affordability!

Oil prices hammered by increase in U.S. rig count
By Jenny Hsu
Published: Aug 22, 2016 3:28 a.m. ET
Brent slides back below $50 a barrel
Higher oil prices are feared to lure back U.S. shale producers to the market

Crude oil prices slumped on Monday as investors chose to cash in their gains on growing fear the rise in oil prices will prompt more U.S. shale oil players to return to the oil patches.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in September (CLU6, -1.40%) slid 88 cents, or 1.8%, to $47.64 a barrel. October Brent crude on London’s ICE Futures exchange (LCOV6, -1.49%) fell 93 cents, or 1.8%, to $49.95 a barrel.

Comment by azdude
2016-08-22 04:42:24

The smart money gets out before the herd does.

Comment by The Selfish Hoarder
2016-08-22 08:07:14

Sell your stuck-o-box.

Comment by Apartment 401
2016-08-22 04:51:52

As Homeless Find Refuge in Forests, ‘Anger Is Palpable’ in Nearby Towns:

“To millions of adventurers and campers, America’s national forests are a boundless backyard for hiking trips, rafting, hunting and mountain biking. But for thousands of homeless people and hard-up wanderers, they have become a retreat of last resort.

Forest law enforcement officers say they are seeing more dislocated people living off the land, often driven there by drug and alcohol addiction, mental health problems, lost jobs or scarce housing in costly mountain towns. And as officers deal with more emergency calls, drug overdoses, illegal fires and trash piles deep in the woods, tensions are boiling in places like Nederland that lie on the fringes of the United States’ forests and loosely patrolled public lands.

“The anger is palpable,” said Hansen Wendlandt, the pastor at the Nederland Community Presbyterian Church.

Some residents have begun taking photographs of hitchhikers or videotaping confrontations with homeless people camping in the woods and posting them online, including on a private Facebook page created recently called Peak to Peak Forest Watch. Some say the campers have cursed at them for driving past without picking them up, or yelled at them while they were cycling or hiking. They say they no longer feel comfortable in some parts of the woods.”

Comment by 2banana
2016-08-22 05:39:06

Yeah. I am going to pick up some homeless meth head deep in the woods with my family in the car…

Comment by Apartment 401
2016-08-22 06:29:22

I pick up hitchhikers in the mountains based on the quality of their gear. If they look like gutter punks living on the 16th Street Mall, no ride for you. The last hitchhikers I picked up (at the intersection of US 24 and CO 82) were thru hikers on the Colorado Trail, headed to the hostel in Leadville for a rest day after hiking for several consecutive days.

Those goobers from Alabama who started the fire near Nederland are nothing more than poor white trash.

Comment by oxide
2016-08-22 07:07:36

The ones that tried to put out the fire with rocks. Yeah.

Please be careful about the hitchhikers. What if the hitcher is really a gutter punk who just stole the high-qual gear from a previous driver?

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Comment by Apartment 401
2016-08-22 07:15:47

Gutter punks can’t survive at high altitude. And when they do travel, they stay close to the Interstates.

Comment by TheCentralScrutinizer
2016-08-22 10:04:16

Altitude is the enemy of most parasites.

Comment by MightyMike
2016-08-22 10:42:20

Yeah. all of those rich and powerful masters of the universe who attend forums in Aspen are the best people on the planet. They all grew up poor and gained wealth and power through hard work.

Comment by taxpayers
2016-08-22 05:01:18

Zillow claims a 6 month break even in my hood
The in out is 7% w realwhore commissions and transfer taxes

That’s insane

Comment by Apartment 401
2016-08-22 05:06:15

FoxNewsHate rallies the base:

“Due for completion next year, the naval outpost is expected to feature weapons stores, ship and helicopter maintenance facilities and possibly a small contingent of Chinese marines or special forces, according to foreign officers and experts monitoring its development. Its cluster of low-rise concrete buildings and shipping containers, some with Chinese flags, offers the most tangible sign yet of China’s strategy to extend its military reach across the Indian Ocean and beyond.

In doing so, China is accelerating its transformation from an isolationist, continental nation to a global maritime power, a move that could challenge Western security partnerships that have underpinned the world order since 1945.”

Right now, only a handful of nations have bases beyond their borders. The U.S. has the most, in 42 foreign countries. Britain, France and Russia each have them in about a dozen countries and overseas territories.

No “smaller government” or “less regulation” or “lower taxes” happening here.

Comment by Apartment 401
2016-08-22 06:42:46

Huffington Post provides the following narrative:

“It’s not every day that Republicans publish an open letter announcing that their presidential candidate is unfit for office. But lately this sort of thing has been happening more and more frequently. The most recent example: we just heard from 50 representatives of the national security apparatus, men — and a few women — who served under Republican presidents from Ronald Reagan to George W. Bush. All of them are very worried about Donald Trump.

They think we should be alerted to the fact that the Republican standard-bearer “lacks the character, values, and experience to be president.”

That’s true of course, but it’s also pretty rich, coming from this bunch. The letter’s signers include, among others, the man who was Condoleezza Rice’s legal advisor when she ran the National Security Council (John Bellinger III); one of George W. Bush’s CIA directors who also ran the National Security Agency (Michael Hayden); a Bush administration ambassador to the United Nations and Iraq (John Negroponte); an architect of the neoconservative policy in the Middle East adopted by the Bush administration that led to the invasion of Iraq, who has since served as president of the World Bank (Robert Zoellick). In short, given the history of the “global war on terror,” this is your basic list of potential American war criminals.

Their letter continues, “He weakens U.S. moral authority as the leader of the free world.”

Securing the Realm. Yes, Realm.

Comment by snake charmer
2016-08-22 08:43:31

It’s interesting, all these career bureaucrats coming out in favor of the neoconservative status quo that legitimates them and their failed judgment. Earlier this year we had the 50+ people at the State Department demanding direct U.S. military action to force Assad from Syria, as if removing secular autocrats from Muslim countries had served America’s national interest in any conceivable way.

Comment by Palm Beach County
2016-08-22 05:24:15

Since the Start of the Last Bear Market
Paul J. Lim @pauljlim Aug. 19, 2016
Getty Images—iStockphoto
If history is any guide, there’s a 66% chance that a bear market is lurking just around the corner.

The 4 Moves That Separate Simone Biles From Other Elite Gymnasts
The 4 Moves That Separate Simone Biles From Other Elite Gymnasts
Evidence of Corruption Cause Sanctions to Stand Against Lawyer in Ecuador/Chevron Lawsuit Promoted
Evidence of Corruption Cause Sanctions to Stand Against Lawyer…
Recommended by
A key gauge of frothiness in the market has officially hit its highest reading since the start of the last bear market in October 2007.

While there are several ways to measure how expensive stocks are, one of the most reliable gauges compares stock prices against the past 10 years of averaged, or “normalized” corporate earnings. This particular price/earnings ratio — commonly referred to as the “Shiller P/E” after Yale economist Robert Shiller, who popularized its use — climbed to 27.3 this month.

The last time the Shiller P/E was above 27 was in October 2007, the start of the last bear market, which erased more than half of the value of U.S. equities from October 2007 to March 2009.

Comment by 2banana
2016-08-22 05:41:32

Things are different now.

Everyone wants to be in stocks.

They got nowhere else to go with ZIRP.

Comment by Professor Bear
2016-08-22 06:37:11

See comments below about coastal living.

Comment by taxpayers
2016-08-22 07:08:15

schiller’s 10 yr average is not working
17 is high ,but not too insane

Comment by 2banana
2016-08-22 05:36:20

Update on the zerohedge article. It is amazing how quickly bubbles burst. No time to get to the exits.


As The Vancouver Housing Market Implodes, The “Smart Money” Is Rushing To Get Out Now

Three weeks after we suggested that the Vancouver housing bubble had popped in the aftermath of the implementation of the July 25 15% property tax in British Columbia targeting the Chinese free for all in Vancouver real estate, we got confirmation of that last week when we reported that only one word could describe what has happened to Vancouver housing in the past month: implosion.

Zolo, a Canadian real estate brokerage, which keeps track of MLS home sales in real-time and reports prices as an average rather than the “benchmark price”, showed as of last week a major correction underway in most Metro Vancouver markets. According to the website, the City of Vancouver currently has an average home price of $1.1 million, down 20.7% over the last 28 days and down 24.5% over the last three months. The average detached home is $2.6 million, down 7% compared to three months ago.

The number of transactions has likewise slammed shut: while August is typically one of the slowest months for real estate transactions, MLS sales data from the first two weeks of the month shows what many have been hoping for during the last few years of escalating prices. According to MLS listing data, there were only three home sales in West Vancouver between Aug. 1 and 14 this year, compared to 52 during the same period last year. That’s a decrease of 94%.

Comment by Professor Bear
2016-08-22 06:14:09

It’s analogous to people living in coastal cities noticing that the water has disappeared from the beach. You can run for the hills, but there’s a good chance you’ll find yourself stuck in a traffic jam when the tsunami overtakes you.

Comment by redmondjp
2016-08-22 10:25:42

What people do instead is to run out onto the beach and marvel at all of the exposed sea creatures.

Comment by phony scandals
2016-08-22 05:42:10


Do your job!

That won’t happen, probably an assault case for flyer grabbing.

Hillary Clinton campaign workers committing voter fraud in Las Vegas - 233k - Cached - Similar pages
1 day ago ..

Comment by oxide
2016-08-22 05:47:14

More from bloomibergi. Donald Trump started a mortgage company… in spring 2006. :roll:

Comment by Professor Bear
2016-08-22 06:16:17

‘It’s “a great time to start a mortgage company,” he said’

Bad luck of timing…and judgment.

Comment by 2banana
2016-08-22 06:42:14

He should have stuck to being a community organizer.

Comment by phony scandals
2016-08-22 07:05:24

He wasn’t a Friend of Angelo.

Comment by taxpayers
2016-08-22 07:06:17

best to be 0 or Clinton and never have tried being in biz, just a parasite

Comment by Jesus Navas is my Lord Savior
2016-08-22 08:00:13

They are just smart I guess. They have found even better ways to gain power and earn millions without risking anything.

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Comment by TheCentralScrutinizer
2016-08-22 10:06:49

They take a risk every time they go outside… plenty of second amendment solution nutballs on the loose.

Comment by 2banana
2016-08-22 10:50:39

Not in Chicago.

The entire city is pretty much a gun free zone.

Comment by Jesus Navas is my Lord Savior
2016-08-22 11:20:23

second amendment solution nutballs on the loose.

Who they want to kill more, Trump or Hillarious?

Comment by Professor Bear
2016-08-22 05:52:06

Credit Markets: Stimulus Efforts Get Weirder — WSJ
By Christopher Whittall
As central banks run out of bonds to buy, they flood corporations with cheap money

The European Central Bank’s corporate-bond-buying program has stirred so much action in credit markets that some investment banks and companies are creating new debt especially for the central bank to buy.

In two instances, the ECB has bought bonds directly from European companies through so-called private placements, in which debt is sold to a tight circle of buyers without the formality of a wider auction.

It is a startling example of how banks and companies are quickly adapting to the extremes of monetary policy in what is an already unconventional age. In the past decade, wide-scale purchases of government bonds — a bid to lower the cost of borrowing in the economy and persuade investors to take more risk — have become commonplace. Central banks more recently have moved to negative interest rates, flipping on their head the ancient customs of money lending. Now, they are all but inviting private actors to concoct specific things for them to buy so they can continue pumping money into the financial system.

The ECB doesn’t directly instruct companies to create specific bonds. But it makes plain that it is an eager purchaser, and it lays out the specifics of its wish list. And the ECB isn’t alone: The Bank of Japan said late last year it would buy exchange-traded funds comprising shares of companies that spend a growing amount on “physical and human capital, ” essentially steering fund managers to make such ETFs available to buy.

The furious central-bank buying has been a relief to companies and governments that can now borrow at rock-bottom interest rates. But it has also spurred criticism that the extreme policies are killing the returns available to other investors, such as pension funds, and loading up the economy and financial system with potentially overpriced debt.

Comment by Professor Bear
2016-08-22 05:54:11

Has the globalist central banking cartel killed the market system by drowning it in cheap money?

Comment by aNYCdj
2016-08-22 05:57:01

dont allow anyone to think outside the box or have fun…

School Humiliates Teen For Wearing This Lace Dress To A High School Dance

Comment by Professor Bear
2016-08-22 06:02:46

Worse Than The 2008 U.S. Crash

Hexun, China’s largest finance portal, recently published an article pointing to Canada’s debt-fuelled economy. They noted that Canadians have the largest debt-to-income ratio of any G7 country, with the average spending 165 per cent of their salary. To contrast, at the height of the U.S. housing crisis in 2008, Americans carried what was then considered an outlandish 147 per cent debt-to-income ratio — 17 points lower than where we currently sit.

Canada’s total household debt reached $1.892 trillion, with $1.234 trillion of that as mortgage debt — roughly 65 per cent more than we make per year. To put that $1.82 trillion into perspective, we could have run the U.S. government for eight months with that amount of money.

CN Gold, another one of China’s large financial sites, ran an article quoting Toronto-based economist Paul Ashworth who told them “This is a very big bubble. And it’s going to end in tears.” They then went on to say that once this bubble bursts, real estate will likely be a major “blow to the Canadian economy.”

Comment by Jesus Navas is my Lord Savior
2016-08-22 08:12:09

Carney at work. He’s now at BOE and the same fate awaits the limeys.

Comment by TheCentralScrutinizer
2016-08-22 10:07:52

Tears? No. Blood AND tears? Yup.

Comment by Apartment 401
2016-08-22 06:37:58

Walmart’s Out-of-Control Crime Problem Is Driving Police Crazy:

“Before he can finish the paperwork, Walmart security employees catch another shoplifter. They bring in a middle-aged woman with big sunken eyes and pale cheeks, her hair tied in a messy bun. Employees caught her using phony gift cards. She rattles off excuses: The cards were given to her by a friend, she’s just gotten out of the hospital, she’s dehydrated. At one point she pretends to vomit into a trash can. Picking up the odor of pot, Ross takes a look in her handbag and finds marijuana roaches, along with a small scale and a pill bottle full of baggies. A computer check reveals five outstanding warrants for her arrest.

Police reports from dozens of stores suggest the number of petty crimes committed on Walmart properties nationwide this year will be in the hundreds of thousands. But people dashing out the door with merchandise is the least troubling part of Walmart’s crime problem. More than 200 violent crimes, including attempted kidnappings and multiple stabbings, shootings, and murders, have occurred at the nation’s 4,500 Walmarts this year, or about one a day, according to an analysis of media reports. Sometimes they’re spectacular enough to get national attention. In June, a SWAT team killed a hostage taker at a Walmart in Amarillo, Texas. In July, three Walmart employees in Florida were charged with manslaughter after a shoplifter they chased and pinned down died of asphyxia. Other crimes are just bizarre. On Aug. 8, police discovered a meth lab inside a 6-foot-high drainage pipe under a Walmart parking lot in Amherst, N.Y.

Police chiefs and their officers on the ground say that’s just not so. Ross likes to joke that the concentration of crime at Walmart makes his job easier. “I’ve got all my bad guys in one place,” he says, flashing a bright smile. His squad’s sergeant, Robert Rohloff, a 34-year police veteran who has to worry about staffing, budgets, and patrolling the busiest commercial district in Tulsa, says there’s nothing funny about Walmart’s impact on public safety. He can’t believe, he says, that a multibillion-dollar corporation isn’t doing more to stop crime. Instead, he says, it offloads the job to the police at taxpayers’ expense. “It’s ridiculous—we are talking about the biggest retailer in the world,” says Rohloff. “I may have half my squad there for hours.”

Comment by TheCentralScrutinizer
2016-08-22 06:43:59

Walmart is where human trash gathers… might as well just put up a fence around it.

Comment by Apartment 401
2016-08-22 07:00:01

I shop at WalMart between the hours of 6-7am before the FSA can get out of bed. Nobody beats their prices on 7.62×39.

South Denver doesn’t have alot of black people but there are alot of white fats and brown fats, with tattoos all over their fat bodies. If my local WalMart had a mascot it would be a fat, tattooed, Spanish speaking, brown mom of 4 with a cart full of high fructose death syrup to feed her fat brood.

Comment by taxpayers
2016-08-22 07:09:36

TAX FAT people !
under socialized med u have to

hooking them to carts is also an option

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Comment by aNYCdj
2016-08-22 07:30:35

of course there is always a solution cut $25 a month off each person, even kids, food stamps then the add $50 a month for fresh fruits veggies, yogurt and a few other healthy foods…. if you eat right you actually get more money.

and its a use it or lose it deal, it resets back to $50 each month no carryovers.

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Comment by TheCentralScrutinizer
2016-08-22 07:47:22

” If my local WalMart had a mascot it would be a fat, tattooed, Spanish speaking, brown mom of 4 with a cart full of high fructose death syrup to feed her fat brood.”

Sounds very similar to Walmart fauna in California, except there is always 5 foot tall papasita who is very lean from busting ass in the fields to feed them all.

Anchorage walmart is truly the pinnacle. Majestic white fats of all varieties, a parking lot with 40 handicapped parking spots to accommodate them, and no fewer than 10 electric fat carts to haul them about. Somebody should do a documentary.

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Comment by redmondjp
2016-08-22 10:28:11

We’ll get Ken Burns right on that!

Comment by oxide
2016-08-22 12:19:42

Burns did do a documentary on cancer. But seriously, someone has got to figure this out. I simply do not buy the usual meme of lazy people and cars and computers. People had the cars and the TV’s since the 1960’s and we didn’t see this level of obesity until… mid 80’s, I think.

My bets are on the high fructose death syrup and, more importantly, soybean/corn/canola/sunflower/safflower oil. It’s not just the raw calories — there’s got to be something with the metabolism.

Comment by In Colorado
2016-08-22 09:02:01

I shop at WalMart between the hours of 6-7am before the FSA can get out of bed.

I was under the impression that they all sleep in until noon. Going during the afternoon is an interesting experience, especially when you see all of the morbidly obese Hispanic kids.

I saw a lot of tats in Central Europe. It appears to be a global scourge.

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Comment by Jesus Navas is my Lord Savior
2016-08-22 09:26:32

Nothing screams prole more than tats.

Comment by snake charmer
2016-08-22 12:09:45

With the exception of photos of MS-13 gang members, I never used to see tattoos in Latin America, and they’ve made inroads there too, especially among professional athletes. The Chilean soccer team resembles Motley Crue. And Messi has a sleeve, which looks awful.

Comment by 2banana
2016-08-22 06:46:49

I stay far away from Walmart. This is one of the reasons.

As for the crime there. Once Walmart comes in and destroys all the small businesses in a town…there is really no where else for the shoplifters to go.

Stop shopping there. Shop at local businesses.

Walmart cares when they lose money.

Comment by Jesus Navas is my Lord Savior
2016-08-22 07:15:58

Stop shopping there. Shop at local businesses.

Nonsense, commie talk.

Comment by Apartment 401
2016-08-22 06:52:34

More Big Government for all the Big Government authoritarians:

“Boca Raton-based prison operator The Geo Group said Friday it doesn’t expect to lose federal prison business despite a U.S. Justice Department decision to end prison-management contracts with private companies.

“There’s been an overreaction to the news about the [Bureau of Prisons] contracts,” Geo chairman and CEO George Zoley said in a conference call Friday. “We think, in time, this will correct itself.”

Deputy Attorney General Sally Yates on Thursday announced a decision to either decline renewing contracts for private prison operators when they expire or “substantially reduce” the contracts’ scope, according to a memo. Yates wrote that the goal is “reducing — and ultimately ending — our use of privately operated prisons.” She added that they don’t provide the same level of “safety and security” and don’t save on costs, citing a report by the department’s Office of Inspector General.

The Inspector General’s Office analyzed data from fiscal years 2011-2014 for 14 private-contract prisons and 14 prisons managed by the Bureau of Prisons. The three private contractors were The Geo Group, Corrections Corp. of America, and Management and Training Corp., which it said manage 12 percent of the nation’s prison population at a cost of $639 million in fiscal 2014. The report said that, in recent years, disturbances in several federal contract prisons resulted in “extensive property damage, bodily injury, and the death of a correctional officer.”

Comment by taxpayers
2016-08-22 07:11:48

Hilary will let so many out they won’t need the private prisones

Comment by 2banana
2016-08-22 07:29:15

That is one long article with little in the way of stats.

Cost per inmate per year?

Legacy costs? Pensions costs?

What is amazing is the amounted we spend on illegals in jail.

Can’t deport them when they get here and then when they commit more crimes have to pay to keep them in prison.

And Hillary doesn’t even think we should deport these illegal gang bangers once they get out of prison

Comment by taxpayers
2016-08-22 10:16:22

Gov numbers always ignore pension cost
They assume defined benefit = defined contribution
Gold vs. Lead

Comment by The Selfish Hoarder
2016-08-22 08:09:17

Big government authoritarians = Trump and Hillary worshippers.

Comment by TheCentralScrutinizer
2016-08-22 08:16:56

Now that’s just hurtful. There are no Clinton supporters here, but Trumplings have FEELINGS. Everybody is always making fun of them for no good reason! It’s a conspiracy!

Comment by Jesus Navas is my Lord Savior
2016-08-22 11:27:00

There are no Clinton supporters here

LOL…no they don’t support her, but they just vote for her.

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Comment by The Selfish Hoarder
2016-08-22 08:04:24

“Chinese authorities said 450 suspects have been arrested this year in a crackdown on using offshore companies and ‘underground banks’ to transfer money illegally, underscoring the scale of the task for officials trying to control capital flows”

Bitcoin, ETH, Litecoin, Dash.

Comment by Yaan
Comment by The Crushin' Russian
2016-08-22 08:19:17

They mean it’s much to early to buy a house. They’re right.

Get what you can get for your house today because it’s going to be far less tomorrow for years to come.

Comment by Rental Watch
2016-08-22 09:52:06

I tend to agree…certainly on the public side.

The funny thing is that I heard people say that the opportunity was gone in Public REITs starting 3-4 years ago.

Is Goldman right currently? Maybe, but construction levels are still generally low. The supply glut that usually foretells a problem in RE hasn’t emerged….yet.

Comment by The Crushin' Russian
2016-08-22 09:54:55

17 million excess, empty and defaulted housing units and millions more in the pipeline isn’t a supply glut?

Comment by spmk
2016-08-22 08:37:41

Strange that in recent weeks, a bunch of the big investment banks and famous investors have come out with public warnings about everything — stocks, bonds, real estate.

I don’t recall them issuing similar warnings in the dot-com bubble, or the previous housing bubble.

Maybe this time, it’s a CYA sorta thing. Like when the next round of bubbles deflate, they can go back and point at these things and say, “See? You can’t be mad as us this time — we told ya!”.

Usually I’d be wary to believe anything a bank or public investor guy says about forecasting markets. I tend to think if they are saying sell, that means they want to buy, and vice-versa. But who knows anymore.

It is strange to see.

Comment by snake charmer
2016-08-22 08:48:04

That’s been the Fed’s strategy — there’s always one governor (the “job” rotates over time) who dissents from the Fed’s decisions. That way, the institution can be credited with seeing the next crash coming.

Comment by Rental Watch
2016-08-22 09:54:12

My own opinion is that it is a time to be a sharp shooter, not buying an entire market (or broad strategy).

“risk on, risk off” in other words is a tough strategy today. Choosing to buy one particular stock or asset isn’t as bad a strategy if you know what to look for, do your homework, and are patient.

Comment by Ben Jones
2016-08-22 08:40:15

‘the spectre of large-scale money-laundering through cash buys in the Auckland market - which the anonymous real estate agent also raised - must be investigated. It must not be simply swept under the carpet while the Government meanders slowly towards cracking down on the estimated $1.3 billion of ‘dirty money’ washed through New Zealand each year’

That much was going into Vancouver in a month earlier this year.

Comment by Ben Jones
2016-08-22 08:42:30

‘Kitchen supplies wholesaler Andrew Shen was one of dozens of bidders for a four bedroom house in Epping that sold for $1.8 million on Saturday. The 26-year-old, who moved from Jaixing, near Shanghai, in 2010 and is now an Australian citizen, was looking to move his new family out of their cramped flat. He said he had been house hunting in the area for more than two months and had his heart set on the brick home next door to West Epping Park, but was priced out by another Chinese buyer.’

‘I think this price was a bit too high for the market. It was incredible, crazy. I hope I can find another one,’ he said.’

There will be another one Andy. BTW, take a look at this 1.8 M house. Not exactly a mansion.

Comment by AbsoluteBeginner
2016-08-22 08:56:37

He comes from the land down under. Wonder if economics is different there.

Comment by spmk
2016-08-22 10:29:22

No, it’s the same. It’s just the money flushes down the toilet the opposite way. :-) (kidding, sorry for bandwidth waste).

Comment by snake charmer
2016-08-22 10:53:01

My first trip to Australia, the very first thing I did upon checking into the hotel was fill up the sink and watch the water drain.

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Comment by In Colorado
2016-08-22 09:04:55

Did anyone here already mention that the winner of the women’s 800m dash in the Olympics was a dude?

Comment by Jesus Navas is my Lord Savior
2016-08-22 09:30:54

Sadly there’s not a lot money in women’s sports. Otherwise, every women’s sports would be dominated by former dudes.

Comment by In Colorado
2016-08-22 09:51:23

There is Title IX scholarship money in the NCAA. I could see some guys who couldn’t make the cut on the men’s squads claim to be trannies to get on the womens’ teams to get some of that scholarship money, they could play on the ladies softball team for a free ride. Whether or not they will go on to the Olympics to compete as women might be a different story.

Comment by taxpayers
2016-08-22 10:21:32

U can’t say that
I’m turning u in to a soon to formed Hilloxa brigade.
Taxpayer funded of course.

Comment by 2banana
2016-08-22 10:57:33

If men and women are equal in all ways…

Why do we even have woman’s sports?

With lower standards (go Google height differences in the hurdle height or shot put weights etc.).

It should be one team. Equal pay for equal Work?


Comment by Professor Bear
2016-08-22 13:02:36

That’s genderist.

Comment by The Crushin' Russian
2016-08-22 10:05:08

Georgetown(Wash DC) Housing Prices Crater 11% YoY

Comment by taxpayers
2016-08-22 10:22:56

Dc area going up about 3% as Hitler is on her way to spend up a storm

Comment by MightyMike
2016-08-22 10:21:13

Trump’s real endgame: A white nationalist media empire?

By Greg Sargent

August 22 at 9:23 AM


Has Donald Trump given up on winning the White House and “pivoted” (this might be his real pivot) to a full-blown effort to build a national following that will outlast the election, perhaps allowing him to establish a media empire with him at the helm — one that caters, at least to some degree, to a white nationalist or “alt-right” audience? Was that his plan all along?

The last few days have brought fresh reporting and evidence that suggest this is where Trump is really headed, a scenario that a number of observers (your humble blogger included) have been speculating about for months. I thought it would be useful to round up this evidence:

* Vanity Fair media writer Sarah Ellison reports in a radio interview that Trump has had private discussions with his inner circle about “how to monetize” the new audience he’s built up. As Ellison puts it, this potential goal should no longer be seen as “speculation.”

* The New York Times reports today that in July, Trump’s campaign “spent more on renting arenas for his speeches” than he did on setting up a national field operation, leaving him with no operation to speak of. That is consistent with the idea that Trump (as I’ve speculated) is very consciously sinking most of his resources into a format (rallies) that allows him to continue staging his unique form of raucous WWE-style political entertainment, and building an audience that thrills to it, rather than winning a general election.

* Sarah Posner of Mother Jones has some excellent reporting this morning on new Trump campaign chief Stephen Bannon, which shows Bannon has skill and experience in building a media outlet (Breitbart) explicitly aimed at the ethno-nationalist audience. As Bannon himself put it last spring: “We’re the platform for the alt-right.” Bannon, naturally, denies that his nationalism is racially driven. But Posner shows that Bannon has regularly “stoked racial themes,” and one former Breitbart insider has explicitly said that Bannon’s Breitbart has become “a gathering place for white nationalists.”

Either Trump actually sees Bannon as just the guy to expand his appeal — i.e., he actually thinks that doubling down on the same approach and themes that won the GOP primaries will somehow expand his appeal — or he has something else in mind.

* Trump’s first TV ad of the general election, with its fearmongering about refugee-terrorists and dark hordes flooding over the southern border, did not appear to be aimed at the constituencies Trump needs to improve among — college educated whites, suburban women, nonwhites. And Politico’s Alex Isenstadt reports that the Trump campaign’s plan was initially to air an ad about the economy — which would make more sense as a way to reach those voter groups — but abruptly shifted at the last minute to the hard-core immigration spot, surprising even some Trump campaign insiders. At critical moments, Trump continues to revert to form — which is to say, he keeps speaking to that hard Trumpist core, as if maintaining their interest is the paramount goal.

Comment by Apartment 401
2016-08-22 14:00:26

Andrew Breitbart was murdered under direct orders from Obama.

Comment by Professor Bear
2016-08-22 22:50:21


Comment by In Colorado
2016-08-22 11:50:09

Mexico’s economy shrinks:

Get ready for a ramp up in the Mexodus.

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