General Market Conditions Have Deteriorated
It’s Friday desk clearing time for this blogger. “The economy officially bottomed in June of 2009, according to the National Bureau of Economic Research. Since then, our country has been slowly working its way back to less dire, more promising, conditions. The road to recovery has been somewhat slow and bumpy, but this morning’s S&P Case-Shiller housing report is further confirmation that we are heading in the right direction. Specifically, housing prices continue to strengthen, and have now risen nearly 40% from the lows of 2012.”
“Nationally, prices are now less than 1% from their previous highs. In fact, pockets in the west are reporting double digit yearly price gains, with all-time record highs in Portland, Seattle and Denver (in more ways than one). We can all thank Fed Chair, Janet Yellen, and our friends at the Fed for serving us low interest rates. Historically, low mortgage rates have been a boon for newbie home buyers and real estate in general. But what’s going to happen if interest rates rise? Ah, who cares, for now everything is ‘Rocky Mountain High.’”
“Construction on the H3 Hollywood condominium has stopped, at least temporarily — and that may be an indication that the market for new condos in Broward County is softening, analysts say. In a letter to buyers, the developer, Hollywood Station Investments, noted that ‘general market conditions have deteriorated’ and the company is trying to get construction financing. ‘This may be the first sign that [southern Broward] is catching the flu that Miami-Dade has,’ said Peter Zalewski, principal of the Condo Vultures consulting firm.”
“Ken Thomas, a South Florida economist and banking analyst, said lenders will make every attempt to work with developers, but they’ll insist on more equity in the projects and other terms to reduce risk. ‘A loan that seemed good six months ago or last year may not make sense now,’ he said. ‘[H3] is only one, but I think we’ll be seeing more of these.’”
“Residential mortgage default insurance premiums are likely to increase for homes in hot real estate markets as a result of beefed-up capital requirements for Canada’s mortgage insurers coming into force next year. And it is homebuyers who are expected to bear the added cost, rather than the financial institutions that lend the money for home purchases, according to Peter Routledge, an analyst at National Bank Financial.”
“Routledge said he expects two headwinds to hit the Canadian housing market if the OSFI mandated changes go ahead as proposed: higher mortgage rates and a higher probability that foreclosures will increase. The combined impact could contribute to a cooling of the market. The analyst said the new rules could also serve to crimp the practice of extending the amortization period of a mortgage to reduce monthly payments when a borrower is in financial distress. ‘In our view, this weakens the incentive for mortgage insurance companies to forbear, potentially increasing the likelihood of foreclosure,’ Routledge wrote.”
“A massive new hotel and resort will be developed by Emaar, Dubai’s biggest and most successful property developer on the emirate’s famed Jumeirah Beach. The Emaar move is surprising as the Dubai hotel market is fast approaching an oversupply which is already impacting on the emirate’s occupancy and room rates. Some developers have walked away from projects, even though the buildings have been almost completed.”
“The Kempinski Palace Hotel on the Palm has been under construction for some years. Investors are being told it will be completed this year, but short of a miracle that will not happen. The construction of the Seaview Hotel near the Zabeel Saray Hotel is almost complete however the site has been abandoned for well over a year. The Taj Exotica Hotel is another abandoned construction site, notwithstanding the hotel is partially built. The massive Kingdom of Sheba Hotel and Residences development at the top of the Palm is also an abandoned construction site.”
“Cluttons, a firm of international real estate consultants, has noted that there is an overall slowdown of activities in Lagos’ commercial real estate market, with rents either stagnating or declining across most segments of the sector. According to Faisal Durrani, Head of Research and Partner at Cluttons, ‘The deteriorating global economic conditions have also impacted Lagos’ commercial real estate market, with transaction levels dipping and vacancy rates rising across the board, putting rents under downward pressure and driving landlords towards offering a range of lease incentives to entice demand.’”
“Perth property sellers were feeling a whole lot of pain in the past June quarter, with one in five selling their home for less than the previous purchase price. In the Perth CBD, more than one in two properties, 52.8 per cent, sold at a loss. Nationally the average loss hit its highest level since 2004, with those who lost out taking a bath to the tune of an average of $73,009. But for those who turned a profit, the reward was an average $262,550.”
“‘The loss makes sales figures for houses in Perth at their highest level since September 1996 and for units the highest level ever with data going back to 1994,’ said CoreLogic analyst Cameron Kusher. ‘I think there is probably some more pain to come over the next few quarters at least.’”
“The Singapore property market overall has been muted in this quarter but the auction scene has thrived, according to consultancy JLL. ‘The third quarter also showed a fairly even mix of successfully auctioned property types as well as owner profiles. Preceding quarters typically saw more residential non-landed units and mortgagee sale listings being auctioned off,’ the report said.”
“JLL auction and sales head Mok Sze Sze said: ‘With the uncertain economic outlook and current buyers’ market, the auction will likely become a preferred mode of sale for owners where a definite timeline is set for decision with no cooling-off period. In addition, we anticipate that there will be an increase in mortgagee sales of between 10 and 20 per cent next year.’”
“Speculative buyers have eschewed Chinese stocks in favor of property, prompting even the chief economist at the central bank of the world’s second largest economy to declare that housing was in a ‘bubble.’ Deutsche Bank AG Chief China Economist Zhiwei Zhang thinks he’s pinpointed ‘a clear sign of a bubble’ in the market — one that will end in a major correction in two years’ time. After analyzing how much developers were willing to spend to win land auctions in 10 major Chinese cities in which values are already up 23 percent year-over-year, the economist found that the business case for these bids evaporates unless property prices continue to increase.”
“If property prices simply tread water from here, the Deutsche Bank economist reckons that buyers accounting for more than half of land sales values in these auctions would lose money. The ’soaring land auction premium revealed very high expectation of further property price inflation,’ Zhang said. ‘Indeed unit land prices in many auctions are even higher than the finished apartments nearby, a phenomenon referred to as ‘flour more expensive than bread,’ he writes.”
“Federal Reserve Chair Janet Yellen said that she believes the largest banks in the country can legally exist, days before a handful of them are due to submit reports to the Fed that could lead to their breaking-up. ‘We believe it is possible, even though it is extremely challenging for [these] organizations to comply with the law,’ she said, in testimony before the House Financial Services Committee.”
“Yellen made the remarks in response to questions about Wells Fargo that had been asked by Rep. Brad Sherman (D-Calif.). In their exchange, Yellen told Sherman that the Fed ‘will hold the largest organizations to exceptionally high standards of risk management, internal controls, [and] consumer protection.’”
“Sherman replied that the regulatory body has proven itself incapable. ‘Two million phony accounts not detected by regulators,’ he said. ‘Break ’em up.’ ‘From a Democratic side, I’ve heard too big to fail is too big to manage. From a Republican side, I’ve heard that too big to fail is too big to regulate,’ he added. ‘But whether the fault is the regulators who can’t regulate it, or the managers who can’t manage it, too big to fail is too big to exist.’”
“The line of questioning was repeated later in the hearing by Rep. Mike Capuano (D-Mass.), who pointed out that the Fed had punished Wells Fargo in 2011, for policies similar to those that fostered account falsifications. ‘We are very concerned with all of the compliance problems and violations of laws that have occurred,’ Yellen told Capuano, at the end of his round of questioning. ‘You know they’re laughing at you,’ he replied.”
Trump Tees Up a Necessary Debate on the Fed—-60% Of Stock Gains Since 2008 On Meeting Days
by Wall Street Journal • September 29, 2016
“In a looping debate rant, Mr. Trump argued that an increasingly “political” Fed is holding interest rates low to help Democrats in November, driving up a “big, fat, ugly bubble” that will pop when the central bank raises rates. This riff has some truth to it.”
http://davidstockmanscontracorner.com/trump-tees-up-a-necessary-debate-on-the-fed-60-of-stock-gains-since-2008-on-meeting-days/
Help? Ben and everyone else…what do you think about this?
“If You Don’t Buy a House Now, You’re Stupid or Broke”….
Every quarter-point change in interest rates is equivalent to approximately $6,000 for each $100,000 borrowed over the course of a 30-year fixed-rate mortgage. So, if you have decided to put down $40,000 and borrow $200,000 to help pay the typical nationwide home price, but you wait until mortgage rates rise one full point, you will end up paying an additional $48,000 over the course of your loan. Borrow $500,000, as some people on either coast do, and you are out an extra $120,000.
http://www.hwahomewarranty.com/Housing-Prices-and-Interest-Rates-Do-the-Math
In a normal market where people have to prove they can afford a house, rising interest rates = stagnation or lower housing prices. Cash will be king again soon enough.
“Ben and everyone else…what do you think about this?”
Once interest rates actually start rising home values will stall and crash.
‘A loan that seemed good six months ago or last year may not make sense now’
What’s the interest rate on this loan? There isn’t one. A lot of these guys, Chinese developers included, are running on 3 year debt. As we’ve seen in Manhattan and Dubai, when it comes time to roll it over, sometimes they can’t.
Once interest rates actually start rising home values will stall and crash.
Therefore interest rates must never rise. It would seem that we have the technology for as long as “the system” can survive.
Of course FOMC members know this, which explains why they are likely to keep talking about rate hikes without following through.
In the article you link, the author says that he put forth the low-interest argument in a prior article, and readers responded that when interest rates are low, prices go up to compensate. In the current article, the author did more research:
—————-
I searched the internet for historical home prices and found that average existing home sale prices steadily increased from 1970 through 2006 (the peak before the housing bubble burst)…
…When reviewing the numbers adjusted for inflation, housing prices still rose when interest rates made their steepest climbs and even fell when interest rates retracted. The most obvious examples were the years from 1975 through 1983.
—————-
My answer to this is that factors other than interest rates will affect prices. For example:
1976 - ~1990: “Superwomen” enter the professional workforce and add to household income. The market can support higher prices. Prices go up.
1990-1999 - More knowledge jobs, more money. The superwomen are now supermoms and need housing near good schools. The market can support higher prices. Prices go up.
2000-2006: Housing bubble due to bank shenanigans and people not paying fully amortized PITI etc. Prices go up.
1975-1983: Even through interest rates fell, they were still very high due to Volcker. Also, wages didn’t rise as much as inflation, and we saw the first signs of outsourcing first to the South and then to Mexico. So people couldn’t afford the prices even with slightly lower interest rates.
1977: Community Reinvestment Act
None of those contribute to housing demand and concomitant response to demand.
Is today the day?
From time to time over the past year I’ve been reading that the really nasty bubble is in derivatives. I don’t think anyone knows the real figure, I’ve seen $247 trillion, $555 trillion and (lol) $1.5 Quadrillion. (Why does this remind me of the Weimar Republic inflation?).
Anyway, I had also been reading that the meltdown could be expected around the time of the elections, which is why I sometimes wrote on this blog to watch for late August/September. And now here comes Deutsche, at the very last of the month. Today should be interesting.
dodd frank fixed all that
Some of the banks still haven’t submitted a “living will.” We’ll see how it turns out.
And I guess today is the day for “subprime” (whatever that means) auto loans and other securitization. Tomorrow is when Credit Risk Retention kicks in.
Well, happy day, Deutsche is FIXED! Whew, I guess that settles that, lol.
Nothing to see here, move along.
Gotta hold on to the ponzi for just a little longer…
I’m just so tired of all of this. This huge milestone in my life has been stolen from me. We’ve done everything right, but things are so infernally effed we won’t buy a house. DH came in last night and said, I know we could afford a huge mortgage on our salaries, but the property taxes would be almost $1000 a month. To my credit, I did not say, “No s—, Sherlock.” Normal houses in safe nabes are going for $750+ still. I’d be okay paying $600K, but I think that could be years away. I’m stubborn enough not to buy, but that means we’re stuck in our small rental house with the great rate. We could get another house and keep our kids in the same school, but it would double our rent. We’ll probably go for a long mountain bike ride or a hike this weekend, and that’s great, but for the goal-oriented, being kept out of the market by the Fed, speculators and people who can’t do math is increasingly hard to swallow. I repeatedly feel like I’m being robbed… because I am.
Options are to leave, but DH’s skillset is very narrow; he doesn’t think he’s employable anywhere but very high cost tech- and media-driven cities.
I’m ready to pack it up for Oil City.
But I guess I’m farked there too.
Thanks to everyone, again, for everything you do here. Especially Ben. You da real MVP.
“I’d be okay paying $600K…”
No, you’d never sleep right going forward. Revel in your knowledge… this madness won’t last.
You’re right. I wouldn’t sleep well. I just get panicky when things that should roll the system over and give it a good hiding do nothing because of government/CB intervention. If the market can stay irrational longer than I can stay solvent… well… I’m sure you can see how even though I’m here and very well-informed re: housing, lending, derivatives, interest rates, etc., even I occasionally am overtaken by FOMO.
‘We are very concerned with all of the compliance problems and violations of laws that have occurred,’ Yellen told Capuano, at the end of his round of questioning. ‘You know they’re laughing at you,’ he replied.”
Ha-ha, no, Mike. They’re laughing at YOU, and your colleagues.
‘We believe it is possible, even though it is extremely challenging for [these] organizations to comply with the law’
What an incredible statement. And frankly, it’s the job of the DOJ and the SEC, not the Federal Reserve, to enforce compliance with the law, and those agencies have no desire whatsoever to do that vis-à-vis the big banks.
The revolving door between the TBTF banks and the oversight bodies that are supposed to be regulating them could power a turbine that could light up a small city.
Defraud with impunity, then scream “systemic risk” if you get slapped with a fine (of course actual criminal prosecution is out of the question for these .1% grifters).
http://www.zerohedge.com/news/2016-09-30/rumor-causing-spike-deutsche-bank-shares
It’s the economy, stupid. Trump landslide ahead.
The widening gap in this figure suggests not.
Funny that it doesn’t go with the polls. I firmly believe Trump is under represented in the polls despite his closing the gap. If we get an October surprise economy wise, it’s advantage Trump.
Believe is the right word there. It’s like religion, a faith in something unseen.
The UN and every other unelected, unaccountable supranational body demands that ‘Muricans “Stop Trump.” The crony capitalist, globalist status quo is too lucrative of a racket to ever give up.
http://www.politico.com/story/2016/09/un-news-agency-scrubs-tweet-calling-on-foreign-citizens-to-end-trump-228934
I believe Trump’s support is underestimated. Somebody here made a point a few weeks ago that’s consistent with what I am seeing: where are all the yard signs and bumper stickers? Normally by this time they are everywhere. The election is in less than six weeks.
Putting up a Trump yard sign or bumper sticker is inviting vandalism from the riffraff. But decent people who find Crooked Hillary the most ghastly exemplar of the corrupt status quo are going to turn out in their millions to vote for Trump.
“Putting up a Trump yard sign…”
Mostly in trailer parks
“or bumper sticker” mostly next to the confederate flag sticker on pickup trucks.
And your problem with a Confederate flag?
“I believe Trump’s support is underestimated.”
You see only Trump and Hillary and maybe Gary Johnson in the media, so you naturally assume most American eligible voters will be voting for one of those three (or voting at all).
You made the fallacy of looking through the media’s fish-eye lens.
I certainly know that around here (Silicon Valley), Trump supporters need to be quiet, because if they let it known that they prefer Trump over HRC, they will be publicly berated.
I was yelled at for simply saying that I didn’t trust HRC, and wouldn’t vote for Trump either.
A colleague watched the debate with some friends who “couldn’t watch at home and be supportive of Trump.” And these are not people living in trailer parks.
I always wonder if these feelings are transferred to pollsters…does answering to a person influence what you say? If you are answering with a simple push of a button, is there a record of what you said?
“I was yelled at for simply saying that I didn’t trust HRC, and wouldn’t vote for Trump either.”
I get yelled at too, but by those who support Trump. I’m in Orange County, a very conservative area. But the density of Trump supporters is from those who did not have college education, working class whites. Hence trailer park folks.
There are a lot of leftists here too. Down the street from me when Sanders was campaigning he stopped at Verizon ampitheater for a rally.
If not for Sanders’ saying he would continue the drone assassinations and that he voted to fund the wars, I would prefer him over Hillary or Trump. Face it, if we have to have forced redistribution of wealth, it’s far better to use the redistribution for college aid, health, infrastructure rather than democide, defense companies and banks (as Obama, Trump, Hillary, GWB, GHB, and B Clinton implement / want).
Well, I’m voting for Stein. I believe her support is underestimated also, although my guess is that she’ll still receive by far the fewest votes of the four principal candidates. Maybe 3-4%. And no third-party candidate has any chance of winning a state.
As for turnout and its impact, we’ll see.
I live in CA, so my vote is pretty much irrelevant…HRC is a lock to get the electoral votes from CA.
My small contribution by voting for a third party will be that if HRC wins the presidency, my vote will hurt her chances at carrying a majority of the population–she’ll have a hard time claiming a “mandate from the people” when trying to push her horse-sh*t policies through the House/Senate..
RW - see my steemit link above.
futile.
Landslide for only the few idiots who vote.
https://steemit.com/voting/@larkenrose/democracy-tricking-the-profoundly-gullible
“Specifically, housing prices continue to strengthen, and have now risen nearly 40% from the lows of 2012.”
I’m sure the residents of California homeless camps are raising their glasses to the stunning success of the Fed’s Housing Bubble reflation program.
“We can all thank Fed Chair, Janet Yellen, and our friends at the Fed for serving us low interest rates. Historically, low mortgage rates have been a boon for newbie home buyers and real estate in general. But what’s going to happen if interest rates rise? Ah, who cares, for now everything is ‘Rocky Mountain High.’”
Doesn’t the song reference a drug-induced state of euphoria?
Denver is a f*ing dump.
Don’t move here unless you wanna spend half your life sitting in traffic.
We drove back from Fairplay to Denver last weekend and had to detour through Breckenridge because of the million Front Range gapers who all decided to drive to Kenosha Pass to look at the aspen leaves, take Instagram photos of themselves, and then get back in their cars and drive home without hiking more than 100 yards.
I’ve never been to Colorado, but I’ve seen plenty of photos of the mountains, including some of yours, and maybe it’s just me, I’m used to the lushness of the Appalachians, but that’s some pretty ugly, brown, arid landscape, dog or no dog. Just sayin’. I guess when they’re covered with snow it’s another matter, but geez, what’s the attraction.
The thing about the Appalachians is that they do not go up above the tree line.
Yes they do. In parts of northern New England the tree line can be at 4,000 feet.
OK. That probably doesn’t look “lush” either.
In the Appalacians only a few of the peaks go above the tree line. And for the peaks that do, there is only a very small area devoid of trees. So you go to the little treeless area on the one high peak and see the lush color of the lower peaks.
Still need a donkey to get up there.
In parts of northern New England the tree line can be at 4,000 feet.
Around here it’s about 11,000 feet.
All those 14er summits where Apt. 401 takes his pictures are considered arctic climate, which is why it looks so desolate. Tundra actually grows up there.
Yes, many warnings to stay on trail when hiking at that altitude, because the ecosystem is so delicate.
“…but that’s some pretty ugly, brown, arid landscape, dog or no dog.”
Now that’s fugg’n funny right there. LOLZ. The Front Range is not your Hardwoods of the Blue Ridge Mountains.
LOL. For some people, it’s all about the picture.
I heard a wall st analyst call the low interest rates “medicated money”. The term is well stated.
YellenBux looking for their final resting place. Dead assets and expiring doomed debtors.
‘But whether the fault is the regulators who can’t regulate it, or the managers who can’t manage it, too big to fail is too big to exist.’
Seems as though Megabank, Inc is still Feeling the Bern, even though he is out of the race.
Has the Fed ever before in its history been as politicized as currently?
Don’t you mean “publicized”?
Yellen is in the bag for Hillary, and both are in the bag for Goldman Sachs.
Absolutely, PB.
Read what congressman Charles A Lindbergh (the famous aviator’s father) said about the Fed:
http://www.ourrepubliconline.com/Author/112
He wrote an entire book on it called ‘The Economic Pinch’, published in 1921.
Professor Bear: Has the Fed ever before in its history been as politicized as currently?
Probably. But there’s that saying, “You only see who’s been swimming naked when the tide goes out”. The 2008 financial crisis was the tide going out. The big players were about to lose money. And the Fed is there in no small part to prevent that from happening. And thus we discovered how the system actually operates.
Now, why there were no prosecutions of anyone associated with the fraud around the 2008 crisis was a lesson in how the overt political side acts. The Fed’s actions post 2008 were a lesson in how the covert political side acts.
When this Wells Fargo silliness started, I thought they were going to draw attention to themselves by a mass layoff of organizational pawns. However, it’s been quite instructional for the masses to see, even if they weren’t interested or particularly oblivious, the head of the unit where the crime happened - the driving factor behind the pressure placed upon the pawns - to walk away with 125 large and no prosecution.
How long till gov steals private savings?
Forget the subtle fed action
See Poland,Hungary,Portugal for future results
Got spending cuts ?
Step one: Go to an all-electronic currency system…
And an economy based on Big Data:
Q&A: The data your car collects and who can use it
By Tom Krishner and Dee-Ann Durbin
September 29, 2016 1:15 pm
————————–
DETROIT (AP) — Your car knows more about you than you think.
Newer cars that connect to the internet can collect vast amounts of data about drivers, such as where you went to dinner, if you broke the speed limit or if your seat belt was buckled.
When you buy a car, you cede data control to your car company. Most automakers say they won’t sell information without an owner’s consent. But they’re not legally required to inform you if they do.
Car data is about to become big business. A new report from consulting firm McKinsey says automotive data could be worth $450 billion to $750 billion globally by 2030. Automakers, insurers, high-tech firms, city planners and advertisers are among those who could use data to refine services. Drivers could share data in exchange for navigation systems, or they could pay extra for perks like a parking spot finder.
——————–
Remove the cellular modem from car.
“Step one: Go to an all-electronic currency system…”
Step one: Outlaw private ownership of gold?
“How long till gov steals private savings?”
Why would they want to do that? If they need money, the Fed can just conjure it out of thin air for them.
What happens when more money (aka claims on stuff) gets created from thin air without a commensurate increase in the amount of stuff in existence?
Inflation.
Debt saturation.
‘without a commensurate increase in the amount of stuff in existence?’
There is already too much stuff in existence.What else happens? Demand destruction.
It certainly is reassuring to know that a Deutsche Bank bust up would be less of a mess than Lehman Brothers’ was.
Why a Deutsche Bank bust wouldn’t be as tragic as the fall of Lehman Brothers
Thar she blows!
http://www.zerohedge.com/news/2016-09-30/european-liquidity-banking-system-collapses-deutsche-stock-hits-single-digits
Oops, spoke too soon! Doosh Bank is fixt!
“We can all thank Fed Chair, Janet Yellen, and our friends at the Fed for serving us low interest rates. Historically, low mortgage rates have been a boon for newbie home buyers and real estate in general. But what’s going to happen if interest rates rise? Ah, who cares, for now everything is ‘Rocky Mountain High.”
Yellen and her ilk should be deported to Venezuela. Low mortgage rates,
poor vetting of buyers, and lack of policing banking (Wells Fargo) and Wall Street are the perfect storm. The true A’bomination of the nation.
Drudge Report links this at the top of the left column and titles the link “war drums”
http://www.cnn.com/2016/09/29/politics/aleppo-syria-civil-war-crisis/index.html
No “smaller government” or “less regulation” or “lower taxes” happening here.
Yah, been reading about the Syria situation. In between calling my Senators and Rep’s offices, yelling “Get out! Get out now!” They just say, OK, I’ll let him know. What an incredible cock-up. I don’t even know what to say anymore. I think Putin is just trying to hang on, hoping Trump gets elected and they can actually come to a reasonable accommodation on the situation. If Hillary becomes POTUS, all bets are off.
I just can’t believe what’s been done there. For what? My take is that somehow the US has become the Saudi’s b*tch as of 9/11. Probably way before that. Regime change wherever they want it, Iraq, Libya, Egypt, and now Syria, which is where they hit the wall.
The Syrian “civil war” alone has caused massive destruction and created eleven million displaced people. While Paul Krugman would delight in all those broken windows and broken people, this ruined country is going to be a breeding ground for terrorists and extremists for at least a generation. And now thanks to Merkel, thousands of jihadis seasoned in the Syrian conflict have a free hand to move into the heart of Europe. What globalism and the neocons have wrought….
https://www.youtube.com/watch?v=p8XqahCHdMg
The Syrian conflict has left 11 million Syrians homeless in a devasted country. That’s a lot of Democrat lifetime entitlement resettlement voters to build the Comrades of Proven Worth’s permanent Democrat supermajority.
http://www.breitbart.com/big-government/2016/09/29/obama-administration-brings-12500-syrian-refugee-year-last-minute-rush/
The question is, why are we so consistently supportive, even deferential, towards a nation that gave us bin Laden and supplied 15 of the 19 hijackers on September 11? Perhaps we’re not Saudi America in terms of petroleum resources after all.
As for Syria, the legitimate government invited Russia’s assistance. Russia has been an ally of Syria for decades. No one invited us and I have yet to hear an explanation from our political leadership of what our interests are there. We may not have been a friend of Syria, but a stable Syria is much better for the United States than a chaotic Syria.
But the neocons say this is all about freedom and democracy…for the children. Oh, and “securing the realm” for Greater Israel.
Here Gen. Wesley Clark (ret.) tells of his incredulousness about learning of a neocon plan for “regime change” across the Middle East and North Africa.
https://www.youtube.com/watch?v=EMJON4y_jac
The dimwits of Congress are starting to realize there could be serious repercussions for their political grandstanding against the Saudis.
http://www.zerohedge.com/news/2016-09-30/congress-gets-case-rapid-onset-buyers-remorse-one-day-after-passing-911-bill
Destroying the lives of millions just to run a gas pipeline through Syria. Russian involvement is based on blocking that “pipe dream”.
Merkel, toady of the globalists and banksters, gave the German sheeple who voted for her exactly what they voted for: neoliberal economic policies and open borders. Now infuriated, disillusioned Germans are turning to the “far right” populist-nationalist parties. Imagine how those parties are going to surge if Merkel puts German taxpayers on the hook for yet another bankster bailout, this time of DB.
https://www.yahoo.com/news/europes-populist-surge-fuelled-migrant-crisis-034805145.html
Birds of a feather: Frau Merkel and Crooked Hillary.
http://www.breitbart.com/london/2016/09/30/clinton-names-merkel-architect-europes-migrant-crisis-favourite-world-leader/
Donald Trump’s flip-flop on Angela Merkel is mind-boggling
Forty-six days ago, Donald Trump reached beyond America’s borders for a bogeywoman to compare Hillary Clinton to: German Chancellor Angela Merkel.
“In short, Hillary Clinton wants to be America’s Angela Merkel, and you know what a disaster this massive immigration has been to Germany and the people of Germany,” Trump said. “Crime has risen to levels that no one thought they would ever, ever see. It is a catastrophe.”
It wasn’t his first attack on either. Clinton may be the main target in Trump’s stump speeches, but Merkel has been an occasional guest star for months, with the Republican nominee charging that she’s caused crime in Germany to rise to unbelievable levels and created a “catastrophe” for her country.
But in an interview airing Thursday night, Trump pulled perhaps the biggest about-face of his campaign: Merkel, he said, was a world leader he admired.
Asked by New England Cable News about a world leader he wanted to “emulate”, here’s what Trump said: “Well, I think Merkel is a really great world leader, but I was very disappointed … with the whole thing on immigration. I think it’s a big problem. I was always a Merkel person. But I think she made a very tragic mistake a year and a half ago.”
It’s almost like Trump was asked about a world leader he really liked, and Merkel was the first to come to mind — and then he immediately thought better of it.
https://www.washingtonpost.com/news/the-fix/wp/2016/09/29/donald-trumps-flip-flop-on-angela-merkel-is-mind-boggling/
Rising crime and violence in Democrat-maladministered urban dystopias is surely bullish for housing, right?
https://www.theguardian.com/us-news/2016/sep/30/us-murder-rate-chicago-fbi-data-police
Why can’t Obama’s “sons” learn to behave? LOLZ
Another Drudge link. This one looks like an unjustified police shooting:
http://www.cbs8.com/story/33278742/protests-continue-in-el-cajon-after-deadly-officer-involved-shooting
Which doesn’t really matter, because every TeeVee image of protesters stopping traffic and throwing rocks at whitey means another thousand votes for the Donald.
“This sucker could go down” — George W. Bush
how many whites killed by police?
6 in one day w no media coverage
soon wymin will be the mascot group
Hilery ,untouched for 20 years=man hater
Citizen! Do not resist! We are going to protect and serve the hell out of you….
http://www.businessinsider.com/do-not-resist-militarization-of-police-documentary-2016-9
Ironically, an old friend who used to work and live in Ferguson was visiting us last night. He agreed that the El Cajon incident is quite reminiscent of the Ferguson incident a few years ago. Except that Michael Brown didn’t come off very innocent.
Remain calm. All is well.
http://wolfstreet.com/2016/09/29/deutsche-bank-counterparties-withdraw-cash-government-bailout-planned/
welcome my fellow deplorables……
http://alt-market.com/articles/3023-how-the-deplorables-can-save-america
http://alt-market.com/articles/3018-the-deplorables-who-we-are-and-what-we-want
If the financial system faced a systemic risk, surely our corporate media would alert the public….
http://wolfstreet.com/2016/09/29/loophole-for-deutsche-bank-bailout-game-almost-over/
How Les Deplorables can save America.
http://alt-market.com/articles/3023-how-the-deplorables-can-save-america
Even the MSM is starting to sound the alarm on the housing bubble.
http://www.marketwatch.com/story/housing-party-in-the-us-may-be-coming-to-an-end-2016-09-29
In an era where 95% of the sheeple mindlessly vote for the perceived “lesser of two evils,” Hunter S. Thompson’s 1972 warning has never been more prescient.
http://libertyblitzkrieg.com/2016/09/29/quote-of-the-day-hunter-s-thomsons-prescient-1972-warning/
‘Preceding quarters typically saw more residential non-landed units and mortgagee sale listings being auctioned off…we anticipate that there will be an increase in mortgagee sales of between 10 and 20 per cent next year.’
This is what they call foreclosures in Singapore, Australia and New Zealand.
‘Nationally the average loss hit its highest level since 2004, with those who lost out taking a bath to the tune of an average of $73,009. But for those who turned a profit, the reward was an average $262,550′
Sounds good, right? 262K Australian pesos for doing nothing. The problem is these pesos only come in if someone else pays (borrows) so nothing was created except debt. Heck of a “wealth effect”.
Few things to consider before that 262k gain:
1. How much money was wasted on the mortgage interest?
2. How much was put on home improvement/fixes?
3. 6 or 7% realtor fees when you sell it.
4. Taxes on the “profit”?
It will not even amount to 6 figures after all said and done.
Holy chit… Obama wearing a yarmulke?
Everyone who goes into the inner sanctum of a synagogue wears one as a sign of respect. I’ve been to a Jewish funeral and everyone, Christian, Jew, Muslim, other wears one as they sit and listen to the service. Except the women I think. I just remember wearing one - I’m not Jewish - and I was happy - honored - to do it, out of respect for my friend and his family.
Exactly. I’ve even seen the pope wear one on occasion on visits to Jewish sites.
‘After analyzing how much developers were willing to spend to win land auctions in 10 major Chinese cities in which values are already up 23 percent year-over-year, the economist found that the business case for these bids evaporates unless property prices continue to increase.’
‘If property prices simply tread water from here, the Deutsche Bank economist reckons that buyers accounting for more than half of land sales values in these auctions would lose money. The ’soaring land auction premium revealed very high expectation of further property price inflation,’ Zhang said. ‘Indeed unit land prices in many auctions are even higher than the finished apartments nearby, a phenomenon referred to as ‘flour more expensive than bread’
As I said Thursday, we’ve got our economic wagon hitched to these fools.
They are trying to shift malinvestment away from manufacturing towards the “consumer”.
Given the unprecedented malinvestment in housing andn real estate in general over the last few decades, the cleansing of said malinvestment will be spectacular.
Ok here’s my thought on 78M baby boomers in the US. I would assume most are homeowners, and most have no savings. When they can’t work anymore, and decide to move down, who will buy their McMansions? Can the youngins afford the BBers McMansions with all their student debt and stagnant wages? And when the BB homeowners die, living in their one-story cottages, will there be more supply, forcing a deflationary effect on housing prices? Will the US import more 3rd worlders and so long USA?
We’re like Japan, in the sense adult diaper sales are outperforming infant diaper sales. It’s a mess over there. I met some Japanese Investors the other day, and we chatted, comparing cliff notes.
“decide to move down” into a pine box. What then for housing?
I would assume the BBers are homeowners, and the family might rent out their deceased relative’s home, or sell it. Most will probably sell. In the next 20-30 years, a huge sector of the US population will die off. Just look at the obesity rate of adults alone.
My r e syndication meetings are full of late comers, hoping to get rich over the next 10-20 years. The hosts have been in the game decades. One guy is in off campus student housing and 48 unit apt houses out of Ca. He started his syndications in the early 90’s. Good business mind.
What then for housing? A pine box.
Most retirees don’t move until they need to. In that regard, you don’t need to solve for 78MM homes in a short period of time, you need to deal with a small fraction of that 78MM every year.
At the same time, housing stock in the US is getting older and older, more and more will need to be replaced.
And we are NOT like Japan. Japan has a shrinking AND aging population. We are not yet shrinking, and given population momentum, is projected to grow for at least the next 45 years.
“Retirees” die. 78 million of them with record low population growth in the US.
Baby Boomer don’t own those McMansions outright — has anyone actually eve paid off a McMansion? McMansions tend to be in the boondocks, good luck getting the cosmopolitan Millenials to live in one. My guess is that the McMansions will be bought for peanuts by investment companies and rented out to a crowd of illegals or poor.
HOA won’t allow it.
Fun trolling is contacting McMansion HOAs saying you’re interested in buying in their neighborhood to subdivide McMansions into a bunch of units. Then they freak.
And don’t forget falling prices my friends. Falling prices.
Novato, CA Housing Prices Crater 4% YoY
http://www.zillow.com/novato-ca/home-values/
‘Construction on the H3 Hollywood condominium has stopped, at least temporarily — and that may be an indication that the market for new condos in Broward County is softening, analysts say. In a letter to buyers, the developer, Hollywood Station Investments, noted that ‘general market conditions have deteriorated’ and the company is trying to get construction financing. ‘This may be the first sign that [southern Broward] is catching the flu that Miami-Dade has,’ said Peter Zalewski, principal of the Condo Vultures consulting firm.’
‘Ken Thomas, a South Florida economist and banking analyst, said lenders will make every attempt to work with developers, but they’ll insist on more equity in the projects and other terms to reduce risk. ‘A loan that seemed good six months ago or last year may not make sense now’
Referring to it like a virus spreading in the wind is interesting. These halted condo towers are adding up. This would have been headline news in all the major papers in 2006.
‘China’s two largest bike-sharing services both landed major investments within days of each other, one of them at an unprecedented $500 million valuation, according to people familiar with the matter.’
‘Beijing-based oFo, which only this week announced a strategic investment from China’s Didi Chuxing, raised at least $100 million from global private equity firms in a round that valued the two-year-old company at a half a billion dollars, the people said, asking not to be identified speaking about a private deal. Didi was part of that round, they said.’
‘Crosstown-rival Mobike separately raised $100 million from Asian-focused Hillhouse Capital and other investors, people familiar with the matter said. The fundraisings are unusually large for companies at their stage of development.’
I read that uber is going to deliver food with self-driving cars. Or was it flying cars? And Musk is going to start an interplanetary network or something. I’m still waiting for the paperless office.
” development at the top of the Palm”
Palm Island is built of dredging, which I guess is mostly sand. Building tall structures is going to have the same result as the tower in San Fran bay built on dredgings that we read about a few days ago.
There was some discussion about how the murder rate has increased significantly in many US cities, and the causes.
But there is one reason that nobody has ever discussed.
The local metro murder rate is up. The reason?
The dumb azzed,no common sense, idiotic, FUBAR mess that the local federal, county, and city managers and contractors have made of highway construction projects.
Thanks to poorly thought out and timed projects, EVERY major highway in town has a major construction project, turned all highways into a parking lot. Drives of 20 minutes three years ago are now hour long Death Marches to drive 15 miles
And don’t get me started about some of these idiot drivers……..
x its all about severe functional illiteracy, they can’t read past a 6th 8th grade level….its been obvious to me for years.
so we let them out of jail and they cant even fill out a job application legibly. the toughest stance i can think of, is you are incarcerated until the last day of your sentence, unless you can read the NY Times in front of a parole board and ask for a second chance.
Leave it up to the prisoner how long they want to be in jail.
Reading the New York Times out loud would, to most well-adjusted adults, be an extreme form of “cruel and unusual punishment” for both the reader and the audience. Better to throw “Green Eggs and Ham” at them as a final exam. If they can perform that reading with an engaged lyrical style then there’s hope for them in some sector of the “New Economy”.
Shovel ready jobs
“Shovel ready jobs”
THAT’S THE PROBLEM!!!
You can’t make Solar Panels with shovels.
‘Residential mortgage default insurance premiums are likely to increase for homes in hot real estate markets as a result of beefed-up capital requirements for Canada’s mortgage insurers coming into force next year. And it is homebuyers who are expected to bear the added cost, rather than the financial institutions that lend the money for home purchases, according to Peter Routledge, an analyst at National Bank Financial.’
‘Routledge said he expects two headwinds to hit the Canadian housing market if the OSFI mandated changes go ahead as proposed: higher mortgage rates and a higher probability that foreclosures will increase. The combined impact could contribute to a cooling of the market. The analyst said the new rules could also serve to crimp the practice of extending the amortization period of a mortgage to reduce monthly payments when a borrower is in financial distress. ‘In our view, this weakens the incentive for mortgage insurance companies to forbear, potentially increasing the likelihood of foreclosure’
Rising rates and credit withdrawal. Double whammy. And just when prices are falling. What’s that saying about bankers and umbrellas?
“Rising rates and credit withdrawal. Double whammy. ”
Sorry Obammy.
When is Saudi Arabia going to start dumping US debt?
http://www.aljazeera.com/news/2016/09/saudi-arabia-condemns-passage-911-law-160930042131171.html
‘The California Association of Realtors predicts 2017 is going to be a good year for the state’s inland markets as those on the coast get less and less affordable. The trade group’s 2017 Housing Market Forecast anticipates that the number of homes sold statewide will rise slightly between this year and next. But economists believe soaring prices in Los Angeles, San Diego and San Francisco could slow sales there, while the relatively affordable Inland Empire and Central Valley will see more activity.’
‘Lucio Bernal, a Palm Springs real estate agent with Berkshire Hathaway HomeServices, said when he sees coastal buyers active in the Palm Springs area, they’re usually thinking ahead to retirement. He thinks the region’s low prices continue to encourage buyers to act fast.’
“A lot of the consumers that I see are coming from L.A., San Diego, those markets, but it’s not just second homes, It’s future, near retirement homes,” Bernal said. “I think the feeling of most of our immediate markets, San Francisco, Seattle, anyone who has a direct flight to the Palm Springs area, still sees Palm Springs as affordable to where they would rather buy now, with the anticipation that by the time they retire, those values will increase.”
We’re hitched to these gambling fools too.
What’s the bet that the downpayment for this second home comes via a HELOC from their current coastal home? Ergo, they will be underwater sooner than expected if house prices crash. And just to add another nail in their coffin, the tsunami will spread inland as well.
Downsizing into a fully paid off house while they still can is the best option for soon-to-be-retirees.
How long before the dollar loses its world reserve currency status, thanks to the Fed and its deranged money printing?
http://www.marketwatch.com/story/chinas-yuan-earns-coveted-imf-distinction-heres-what-you-need-to-know-2016-09-30
The best reason of all to vote for Trump.
http://www.businessinsider.com/why-janet-yellen-could-resign-if-trump-wins-2016-9
When an authoritarian is the candidate, no reason is a good reason to vote for him.
Consumers Are Feeling Better About The Economy Than Polls Suggest
Bill Fox sells cars, including all-American Chevrolets and Ram trucks, in an upstate New York town whose congressman lost re-election in 2014 by 20 points — the kind of place where, according to the usual media narrative, voters are angry about the loss of blue-collar jobs and worried about the economy. But like other car dealers, Fox is seeing near-record sales: Somehow, he said, consumers don’t seem as worried about the economy as the pundits say they are.
“We’re not seeing [anger] at all,” said Fox, a partner in Auburn-based Fox Dealerships. “The way I account for it is, the public sees economic indicators that are OK, their job’s not threatened, and they may be afraid of the future, but the monthly [car] payment is good.”
That kind of optimism might be surprising in a year when Donald Trump, at least according to one dominant media narrative, rode a wave of economic anxiety to the Republican presidential nomination and when voters routinely cite the economy as a top concern. In a recent NBC News/Wall Street Journal poll, for example, 48 percent of voters said the country is “losing ground” on economic issues, compared with 45 percent who said it is “making progress.”1 In a recent YouGov poll, 40 percent of respondents said the economy was getting worse, versus 21 percent who said it was getting better. A weekly Gallup survey that asked the same question found that 37 percent think the economy is getting better and 58 percent think it is getting worse. (Gallup’s survey, unlike YouGov’s, didn’t offer “about the same” as an option.) Seventy-two percent of voters say the U.S. is on the wrong track, according to a separate poll from Gallup, which hasn’t found a majority satisfied with the “way things are going in the United States” since George W. Bush’s first term.
Yet even as Americans tell political pollsters that they are worried about the economy, they tell a different story in a separate set of surveys that are used by economists and investors to forecast consumer spending behavior. On Tuesday, the Conference Board’s Consumer Confidence Index, hit a nine-year high. The index is still well below its all-time high, set in 2000, but is as good as during Ronald Reagan’s “Morning in America” era of the mid-1980s. A rival survey from the University of Michigan finds consumers a bit less cheery but is still consistent with a solid economy. (On the other hand, the less well-known Bloomberg Consumer Comfort Index has fallen sharply in September, although it is still up significantly over the past few years.) Even people with only a high-school education — whose economic woes are often cited in media reports explaining Trump’s rise — are about as confident today as they were before the recession began, according to the Michigan survey.
“After a little bit of softening in the spring, [confidence] picked up,” said Lynn Franco, the Conference Board’s director of economic indicators and surveys.
http://fivethirtyeight.com/features/consumers-are-feeling-better-about-the-economy-than-polls-suggest/
I’ve heard that falling prices results in consumer confidence and optimism.
If the availability of car loans bore any relationship to the borrower’s ability to repay the money, these car dealership executives would not be seeing record sales, and they would be singing a very different tune. As would some of the disappointed buyers. Is anyone being turned down for a loan right now?
But we’ll see who’s right, because we’re about to have a referendum on all of this. I already suspect that the Democratic Party will spin a Trump victory as a triumph of white racism and bigotry, rather than as a rebuke of the party’s embrace of Wall Street and near-complete abandonment of economic issues.
I doubt that you can find much evidence in polling that a significant number of people will vote for Trump to express dissatisfaction with the easy availability of car loans.
“Consumers Are Feeling Better About The Economy Than Polls Suggest”
Isn’t that what Lester Holt said to start the debate the other night?
“The way I account for it is, the public sees economic indicators that are OK, their job’s not threatened, and they may be afraid of the future, but the monthly [car] payment is good.”
Actually it’s all about easy credit and balloon payment loans.
Here are some quotes from Charles A. Lindbergh’s 1921 book ‘The Economic Pinch’ which are relevant to our current election season:
“Nearly every political move so far, when intended for the benefit of all the people, has failed because there was no sufficiently definite business plan on which to act . . .
The voters become dissatisfied with the old ways and finally they vote in protest, instead of having a definite plan for action when they win. Anything they consider is likely to be at least as good as the old, so they take a chance . . .
These would-be saviors are beginners - they see the wrong but not the remedy, and in spite of their best intentions, the cause is lost before they start, even if they win an election . . .
The laws favor the old political and profiteer groups; they made the laws.”
Does any of this sound vaguely familiar?
“I’m going to fix this, and it’s going to be great.”
Falling prices to dramatically lower and more affordable levels is fundamental to any future for the US.
Hi Housing Analyst.
How many different names are you posting under today?
I counted at least three.
Where is your good friend housing analyst these days?
It’s a matter of which is better a tan tird or a blond tird? I guess the few people who are interested are more favorable to the blond tird.
https://www.youtube.com/watch?v=P0Ud_Ei8gL8