From the WSJ:
Why Home Prices Are Rising: The ‘Distressed Share’
Tuesday’s measure of June home prices from the S&P/Case-Shiller 20-city index is likely to turn positive when compared with one year ago for the first time in two years, according to a forecast by Zillow Inc.
Prices have risen this summer for a simple reason: more buyers have chased fewer properties. But the drop in supply and the boost in demand isn’t the only reason that Case-Shiller is now turning positive. Another related factor is that the share of non-distressed home sales is rising and the share of distressed sales—foreclosures and short sales, mostly—is falling.
The decline in the distressed share is important for the housing market, and especially for home-price indexes like Case-Shiller. Because banks are faster to cut prices to unload inventory than are mom-and-pop sellers, home values can fall further as the share of distressed sales rises. This was the case throughout 2008, as home price declines were in virtual free fall amid a cycle of rising foreclosures.
A report last week from economists at Goldman Sachs tries to quantify the share of the decline in home prices that can be attributed to the rise of distressed versus non-distressed homes. They conclude that this “mix shift” is responsible for around one third of the 34% decline in home prices since 2006.
While distressed homes normally account for around 5% of all home sales, the distressed share reached a peak of nearly 50% in early 2009, as the housing market unraveled. The share normally falls during the stronger spring and summer months, when there are more mom-and-pop home sellers, while it rises during the seasonally weaker autumn and winter—though it hasn’t gone as high as 50% since 2009.
The share of distressed sales is still high by any historical comparison. But importantly, it is falling when compared with one year ago, which is a big reason why home prices, as measured by the Case-Shiller index, are rising again. In June, the share of non-distressed sales, meanwhile, was at its highest level since August 2008, according to CoreLogic Inc.
In May 2012, around 25% of all homes were distressed sales, down from 31% one year earlier, according to Goldman. Moreover, Goldman estimates that banks are losing less money on distressed sales than they have in the past, in part because banks are pushing short sales more aggressively. The average distressed home sold at a 20% discount to comparable non-distressed homes, an improvement from discounts of 25% to 30% earlier in the crisis.
With distressed homes yielding smaller discounts and fewer distressed sales coming on the market, home prices have stopped falling. In May, for example, the Case-Shiller index showed that prices were down by 0.7% from one year ago. Without the change in the distressed share, prices would have been down by 2%, Goldman estimates.
Good Morning New Jersey
Also from the WSJ:
In Mostly Tepid Housing Recovery, ‘Jumbo’ Home Loans Set Hot Pace
By most measures, the housing market’s recovery has been slow. But private-market “jumbo” mortgages—larger, higher-cost home loans that aren’t guaranteed by the federal government—are making a much faster comeback.
Private-market jumbo loans accounted for about 15% of the total dollar amount of mortgages distributed by Bank of America Corp. during the second quarter of 2012, up from 4% a year earlier, says a spokesman for the bank. At Wells Fargo & Co., private jumbo volume more than doubled in the first half of the year from the same period last year, according to Brad Blackwell, portfolio business manager for the bank’s home-mortgage unit. Citigroup Inc. also says it has increased jumbo lending.
In all, lenders doled out $38 billion in private jumbo mortgages during the second quarter of 2012, up 65% from a year earlier, according to new data compiled by Inside Mortgage Finance, a trade publication. That is the highest quarterly dollar amount since the first quarter of 2008.
“This is a real positive for the entire marketplace, and hopefully this is the first sign that credit markets will open up,” says Jack McCabe, an independent housing analyst in Deerfield Beach, Fla.
Unlike smaller mortgages, many jumbo loans aren’t eligible to be purchased by the governmental-chartered agencies known as Fannie Mae and Freddie Mac, so they tend to be more expensive for borrowers. In most of the country, private-market financing is needed for loans exceeding $417,000; the cutoff points are higher in more expensive markets.
Demand for these loans has been driven in part by a surge in luxury home sales. Sales of $1 million-plus homes rose 19% in July from a year earlier, according to the National Association of Realtors.
Unmaintained homes coming to market.The new reality. Without equity credit homeowners will not spend money for the house,will buy an expensive car though. A car g loan dont need a home equity. Then you have homeowners that have a jj mentality. Dont fix the house if you can not fix it yourself
WASHINGTON (MarketWatch) – U.S. home prices bounced higher at 2.3% for a second month in June, according to an index released Tuesday which showed the strongest back-to-back monthly advance in the more…
From CNBC:
Home Prices Rose in All Major US Cities in June: Case-Shiller
U.S. home prices rose in June from May in every city tracked by a leading index, an encouraging sign that the housing market is improving.
The Standard & Poor’s/Case-Shiller home price index showed increases in all of the 20 cities tracked for a second consecutive month.
A measure of national prices rose 2.3 percent in June from May, the third straight increase. And home prices jumped nearly 7 percent in the April-June quarter from the previous quarter.
G0d bless the current sellers if there’s a jump in interest rates and/or inventory starts to build. There’s a small window right now in our area for those sellers that are desperate to bail. Then again, most of them are too f*cking stup1d and will ride the next torturous wave down.
All:
Cite all the statistics you want. Sam Clemens was right, “There’s lies. There’s damned lies. And then there’s statistics.”
The Case-Shiller index is a lagging indicator and has been “MANAGED” higher. Think about what’s happened and what’s to come.
Banks refuse to liquidate inventory, refuse to use TARP/TALF/etc, get ZIRP loans from Federal Reserve system.
Realtors greedy w/ excessive price points on the limited inventory.
Appraisers giving near-peak 2006 valuations (excessive).
Townships gladly accept the reflation as basis for increased cash inflow to coffers (to meet mounting pension debts).
Owners are delusional as to the value, regardless of the quality.
Value is driven by demand – there are few qualified buyers.
Look at days on market – Ridiculously long and growing.
Look at pricing history – Constantly being downwardly revised.
Look at property taxes – Near 2006 peak.
Look at energy costs, insurance, etc.
WHERE’S THE NEW HOUSING STARTS?
WHERE’S THE JOB GROWTH?
WHERE’S THE INCOME GROWTH?
WHERE’S THE TAX RELIEF?
Did any of that increased money supply (trillion$$$) go to your pocket? If so, ignore this. Else, WAKE UP! The banks seemingly want/have you in a debt trap – buy a home at inflated value (locks in your basis) and finance it w/ suppressed interest rate (not causing demand), all to get cash flow crunched by inflation (food, energy, commodities, etc).
There’s just no rational reason to justify the price reflation, or to believe that C-S index will hold, regardless of who gets elected.
PESHAW!
Dunno if its just a coincidence but I see a flurry of used BMWs and Audi’s in Mercer county. These people don’t even bother taking off the plate cover that says they bought it used.
Big deal homes are up what 3% after falling over 30%. People forget that buying or selling a home is a binary event. The purchase or sales price is meaningless without looking at the other side of the transaction. For instance I looked at a house a spinster is selling she put it on Market in late 2010 for 435K got offered 400K right away, she now says she will take 419K, which I did not want to pay. She is moving in with aging Mom so once see sells money goes on bank. Guess what late 2010 and early 2011 she could have sold for 400K bought a mix of munis, treasuries, investment grade bonds, MBS and blue chip stocks and pretty much locking in around a 30% gain. And have an income stream for life. Now even if she gets 419K she is getting it at a near term stock market peak where munis, treasuries, investment grade bonds and MBS are near record all time lows in yields.
Selling is a binary event. In her case she needed to digest two events, the sales price of her home and what she would do with proceeds of her home sale. She was short sighted. Even if she sells for 500K one day she made a big mistake. Remember in late 2010, early 2010 NYS long term munis for instance was 6%, lady could have locked in 24K a year interest income tax free for life on her 400K sale. Plus she paid to maintain home, taxes and insurance the last two years.
Plus considering that the price on benchmark 10-year notes are 1.639%, the housing recovery is not that impressive.
Relevant share:
A retired coworker rehired as a contractor is heard on phone discussing how she has no need for 4 bedroom house and all it’s up keep (yard, dusting, basic maintenance).
Wants 2 bedroom place for her husband and herself, like other retiree friend.
Just said, “As soon as the market picks up a little, I’m going to see how it does.”
Time value of money and true market value concepts – They’ll never learn!
JJ 9,
Exactly!
Opportunity cost, time value of money, tax differential incurred, upkeep, etc.
“Not that impressive”?!?!
It’s abysmal, regardless of the interest rates and especially in light of the interest rates.
Peshaw
House prices up. Consumer confidence falls to a 9 month low. Just saying.
Interest rates are low, and perhaps with QE 3, they will be even lower. Low interest rates have prevented prices from falling further.
If rates rise, what happens to prices. Scenario 1. it won’t matter as the economy will be booming. Scenario 2. High rates no growth, stagflation, and prices fall.
Which scenario is more likely over the next few years. I believe scenario number 2.
New York: Prices rose 2.1% to take the year-on-year fall to 2.1%.
Ben owning an audi I can tell you I hope they got the service plan if certified pre-owned. Maintenacne costs are a bear, and you need special tools just to do general service items.
Quality inventory low, people sick of sitting on sidelines, low interest rates not surprised if the CS shows positive.
A retired coworker rehired as a contractor is heard on phone discussing how she has no need for 4 bedroom house and all it’s up keep (yard, dusting, basic maintenance).
Wants 2 bedroom place for her husband and herself, like other retiree friend.
See the humor in her comment, but timing doesn’t mean squat in this situation. Staying in the same town and downsizing? Market timing irrelevant. The same tide is impacting both boats. Yes, there may be minor differences based on overall percentage declines or activity in certain pricing tiers, but normal “pricing noise” can make more of an impact. If she is underwater, that’s another situation entirely.
16 grim: My apologies if I was a little cranky yesterday, regarding homeoweners and basic maintenance.
even when trying to criticize his Hopiness the ny times still manages to felatiate him
http://www.nytimes.com/2012/08/28/opinion/roger-cohen-obamas-team-of-idolizers.html?_r=4
This may be a must-read.
http://www.amazon.com/The-New-Deal-Hidden-Change/dp/1451642326#_
[15] pain,
I am never getting another audi, and from what I hear about german cars in general, the maintenance issues don’t stop there. So while I can afford it, I’m not stupid enough or vain enough to sacrifice a year of future tuition costs on a hood ornament.
Once burned . . . .
This sure as hell isn’t a mandate.
http://ap-gfkpoll.com/uncategorized/our-latest-poll-findings-sunday
My VW jetta was a money sink from day one, and I bought it new.
Never again.
Tax Rumination of the Day:
We can determine (more or less) how many wealthy americans are leaving this sinking ship, but one imponderable is how many wealthy foreigners decide against coming here? They decide not to get a green card because they don’t want the IRS to slap a ball and chain on them the second they open the envelope. It’s the flip side of the expatriation coin that I hadn’t considered before. But apparently immigration lawyers have.
http://www.wtas.com/newsletter/2011/december/exit.php
(N.B., that isn’t to say we don’t get incoming wealthy, but consider the source: Many are coming from China where wealth is still considered officially taboo and where one misstep can land you in front of a firing squad)
[22] daddyo
Audi = VW. Learned that early, but not early enough.
Nom we feel the same way just have a hard time getting rid of a paid off car with only 50 K on it. F*cking rear brake job and a tune up costs 1500 bucks. All things I could do myself on most cars not this thing.
#21 First we would have to assume that employers will want to keep people past the 65 year retirement age. Second the longer older people work , the less opportunity for positions to open up for younger workers. Just saying.
Just buy a Honda dolts. Find a used 2009 S2000 if you need to make up for lack of weenie size.
My experiences with German cars are as follows (all occurred many years ago):
1) Dad had an Audi that broke more than it ran. It had that weird auto-acceleration thing going on. The horn also used to sound whenever you made a sharp left turn. Was fun when parallel parking.
2) Dad had a BMW. I took my driver’s test in it. Was beautiful to drive but a fortune to maintain, though it’s reliability was pretty good.
3) Test drove a used Jetta at a dealer. The center of the steering wheel fell off when I was driving it. When I returned the car to the lot, I gave the dealer the keys back and a large piece of the steering wheel. That’s when I bought my Civic, which I drove to work today.
Honda really makes a superior product all around. Whether it be a lawnmower, snowblower or car. They never break and last forever.
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nom[21]
There is lack of appreciation among the economists and politicians of how much in taxes most people are willing to pay for the irrevocable defined benefit program. Telling in one voice that SS will be here and that benefits will not be cut for those currently 20 or 30 yo (and it will be done by charging 2% more in FICA contributions) will do more for the consumer and business confidence than any tax system changes.
Treasury sells 2-year debt at 0.273%
Used Hondas are expensive to insure and parts are expensive when they do break. True they dont break often. I owned a Taurus once at same time wife owned a Camry. Her Carmry broke less often, but when it did it cost more to fix and insurance was a little higher due to theft. It was a wash.
If you fix the car yourself a used plain jane american car from a little old lady with low miles with no theft is cheapest. Neighbor bought a 14 year old Taurus off a little old lady with 14K orginal miles for 3k and had 100K of main free driving.
Lib we had a civic and have an element. the problem with honda isn’t their cars it is their dealer network and Honda USA they just suck.
the audi was my wife spoiling herself. I still drive my 13 yo truck when it is running. Probably buying another Nissan when it dies for good. yes we have 3 cars all of which are paid off so no snide comments.
Yes. One can not get a deal on a Honda. It’s very annoying. With another whippersnapper on the way, we are considering purchasing a used Pilot. Though, looking at the prices, we may just have to spring for a new one. Don’t worry, we’d trade in the Xterra before we got rid of the Civic.
Nom [24];
My brother opted for a Passat over the pricier A4 – same basic platform and engine choices, the Passat had a longer wheelbase and more interior room. I bought that car from him when he had his 3rd kid; I subsequently hit a raised manhole cover right down the center which led to it being totaled. In between I loved the car: it ran like on rails ~110 mph (401 bet Quebec and 1000 Islands); I hated the service network. I managed to avoid the oil sludge problem (2.0l Turbo engine) and the tie rod end recall, but had to go aftermarket to get the ABS computer re-programmed by a shop in Fla. after the local dealership no-bid to fix the ABS light.
Can’t see myself buying another VW while living in the US; Audi is just more money for the same car. I really respect the guy I saw taking his wife shopping at Nordstrom in Roosevelt Field — got out of a Toyota Avalon. Same car with a Lexus badge would have been $20k more. Guy was wearing faded jeans, too. He could afford the Lexus, but didn’t need to stroke his ego. Probably bought it with cash, too.
Anywhere else in the world a MB E-class is a taxicab. If they ever sold the A-class here it would crush their brand image, but they are all over the roads in Germany. Meanwhile Lexus, Infinity, and Acura don’t exist outside the US – same cars sell under the parent badge. Silly Americans.
#21: You think Rmoney cares about a mandate? His and Ryan’s mandate comes from billlionaires, not from you and me. The GOP has been out to get rid of SS since the day it was passed. Lift the cap and the “problem” goes away. Then when the last boomer leaves this mortal coil and the system is back in more of a balanced state, you don’t need a “trust fund”.
I’ve been able to put money away in 401(k) and accumulate because I’ve been lucky enough to work for employers who match. If you take out my company match, the amount I’ve put in over the last 20 or so years has earned just about nothing. Defined benefit pension > 401(k)…at least for the savers (if not for Wall St.). I’ve also been smart enough to not reproduce and lucky enough to have parents who are comfortably enough off that they have not needed me to support them.
The GOP platform explicitly calls for Medicare to go to a “defined contribution” model similar to the 401(k), which means it will be also set up to benefit Wall St.
They’d better start thinking in terms of ethical suicide parlors, or it’s going to be ugly for old people. (Not that the GOP cares, except that old white people are still voting for them.)
Re: Honda/Toyota: I have an 11-year-old Civic with 90K miles and a 9-year-old Corolla with 80K miles. All dealers are shysters. Every time I get stuck taking it to a dealer instead of my local guy (3b and Fast Eddie take note: Get your car work done at Wildridge Service on Washington Ave. if you move to town) they find $800 worth of crap they want to do without which my car will die on the way home. I don’t trust them not to sabotage my car to make it happen either. I got only 107K miles out of 2 earlier Civics that were exclusively dealer-serviced. Somehow I think I’m going to get a lot more out of these cars with Honest Ted working on them.
Paul Miller wanted to charge me more than 600 bucks to replace the xenon headlight bulbs in my X3 when one died. Honestly, I don’t remember if it was for 1 bulb or both, because I walked out laughing. Given they charge $180 for the bulb, and supposedly charge 3.5 hours service, I think that might be the price of one bulb.
How bout that, six big ones for a new headlight bulb. Gone are they days when a ten dollar bill at the autoparts joint and 10 more minutes in the lot got you light.
Shame on BMW for making it impossible to service, it took me about 5 1/2 hours total to change both bulbs.
Tires need to be removed, wheel well liners and under carriage plastic need to be removed, grill removed, bumper removed, headlight washers removed, coolant drained, cross bracing gone. Headlights both need to be removed from the car and disassembled on a bench to replace the bulbs.
Oh, and you need to break at least a dozen nylon pop rivets that aren’t reusable.
I think I spent $150 on new bulbs that I got online and another 15 bucks for the nylon rivets.
I guess I shouldn’t complain, in 120,000 miles it’s the only thing I needed to do (outside of normal service and the AC problem that was covered under warranty).
This one’s for Gary, er, Fast Eddie.
http://legalinsurrection.com/tag/a-f-branco/
Funny,
I taught Gator Junior (he’s 6 years old) how to replace the $2 headlight on his future Civic. It took us about 30 seconds. On the downside, our hands got dirty and we had to use a wet nap! He also knows how to change the air-filter and understands why a magnetic screwdriver is important.
35
Oh please, Jill. Are there any wall-streeters in Obama’s admin?
If you raise the cap, do you raise the cap on the payouts?
Oh and by the way, where is the authority found for a federal pension system?
http://www.usconstitution.net/const.html
I’m sorry I forgot; lawlessness is OK with you.
The democrats (and republicans) are not out to help you.
Nom [38],
Beautiful! I gotta give the guy credit though; in 4 years, he’s created more havoc and divisiveness than anyone could’ve imagined.
Amen joyce.
[42] eddie,
He is merely a symptom. Fact is, in the coming years, we will either become the United States of Europe or embroiled in a low-intensity civil war. I think that this is unavoidable.
I am celebrating 10 years of formally switching my affiliation to Independent.
we buy cars on ebay. 3 so far w/ no issues. last one purchased is a 2000 lexus gs cheap w/ 120k mi. local mechanic checked it out and all was good, preemptively replaced timing belt, water pump, all fluids, full tune up etc. car runs like a champ 10 months so far so good.
42 “…more havoc and divisiveness than anyone could’ve imagined.”
“Ask Republicans what Obama might have done to be less divisive, and the most common response is that he could have abandoned his own agenda and adopted theirs instead; had he done that, they would have been happy to work with him. Which gives us a clue to the terrible thing Obama did to them. By making Republicans hate him with such a burning fire—by having the gall to win the presidency, then brazenly pursuing his party’s longstanding goals like health care reform—he brought out the worst in them. And they really can’t be blamed for that, can they?”
http://www.salon.com/2012/08/27/since_when_is_obama_divisive/
Only rich folk change airfilters, just pop them out, jam a nail in the air pump nozzel at the gas station and blow them clean again. Now changing headlights is fairly easy for nancy boys who buy the part new. The challenge is in the parking garage in under two minutes swapping your headlight with the guys headlight next to you. Funny, I recall in the bronx seeing a guy on way to church with family taking parts off an abondoned car, funny how people say the words replace and change, that is how you people do it, we used to fix cars in the day, I recall rebuilding alternators, starter motors, adjusting points, timing light, heck even rebuild the computer on a 1975 car. Stupid mechanic I went to the other day on my old car, would not pass my car cause turn signals were not working. I tell him give me 20 minutes I will pull turn signal relay under hood, lets open her up clean her up and replace and get this thing ready. He goes I dont know how to fix parts, I just replace parts. How sad. Once used a take off switch from a 747 airplane to replace a switch in a covertible and used a 10 speed derailer cord to run from Carb to gas pedal. Mechanics today are not that smart as all the C+ students go to college now.
Libtard in Union says:
August 28, 2012 at 2:00 pm
Funny,
I taught Gator Junior (he’s 6 years old) how to replace the $2 headlight on his future Civic. It took us about 30 seconds. On the downside, our hands got dirty and we had to use a wet nap! He also knows how to change the air-filter and understands why a magnetic screwdriver is important.
Grim #37: That’s the dealership that bilked me out of $600 for an engine block mount they said was cracked when I went in to have an a/c fan fixed. I was too afraid that they would take a sledgehammer to my engine block mount if I didn’t pony up, so I let them do it, paid them, and vowed never to return.
My first car was an old Audi inherited from my parents. 3 of 4 windows, 2 of 4 doors, and the sunroof all died…and the trunk didn’t open. Engine ran great.
Skip ahead 10 years, I must have bumped my head, but I decide to buy a VW Jetta, ’99 model VR6. Great engine, awesome to drive, but it literally fell apart. Driving out of the dealer lot, the center console latch broke. I should have taken that as an omen and returned it right there.
In the rain, it would stall out. Turns out the MAF sensor wasn’t sealed properly, and no matter how many new ones you got, they would still leak. VW Forums said the only fix was to buy some JB Weld and do it yourself. Driver window clips snapped, dropped the window into the door. Replaced the exhaust system. Needed a whole new rear suspension after 7 years.
I don’t ride cars hard, I think it had 55k miles when I sold it at the 8 year mark. Never buying a German car again.
Oh, and the AC went also.
nom #23
If tax system is regressive to the wealthy,why leave?Will they find less than 15% somewhere? Not too many countries can give stability that the US can provide.Heck,we even guaranteed all monies during the downturn.What country can give that?
I still like this car though.
http://images.thecarconnection.com/lrg/2010-volvo-c70-convertible_100227655_l.jpg
German cars have the best heat. Actually I also had to replace a bulb on my BMW and it was crazy expensive as it is so enclosed. But remember, Germans think different that Americans, I recall once that a German Magazine once voted the GMC Envoy the ugliest car in the world to be sitting behind in a traffic light, it to the Germans is extremely ugly in the rear. Why well its whole spare tire, exhaust system, gas tank, axle, shocks etc are completely exposed and the dirty parts are sticking right out. A german car would cover all of that place it lower to ground make it nice and clean.
But remember, that comes with a price. The envoy any shade tree mechanic even without a jack can fix these parts as they are exposed, the German overengineering makes this an expensive repair.
Hey imposter #47,
Stop using my f*cking name, you f*cking p*ssy. Use your real handle, p*ssy.
The trick with cars is having a reliable mechanic that you can trust.I always went to
A-1 European cars in middlesex for at least 10 years.I found the guy when the dealer want to replace a part cost $800 and a friend suggested the guy.Charge me $20 to tighten something.I went to him from then on. 2 months ago I went for an oil change at Edison volvo.They saw an oil marking on the steering fluid cap and right away they want to replace the container $600.I had it checked no leaks.Watch this dealers!
I always went to Ray Catena to replace the bulbs on my Mercedes.Buy the part and one of the Boys wil replace it.$5 tip always does it.I stayed away from the xenon bulbs.
FYI Run flat tires can be fixed.Go to the dealer and they want to replace it
I have more plugs in my run flat tire than Matthew McConaughey has in his head,
yo says:
August 28, 2012 at 3:15 pm
FYI Run flat tires can be fixed.Go to the dealer and they want to replace it
Hey #55…your name is Fast Eddie
Marketwatch-The bedrock of a stable society is a large and healthy middle class. They not only do the bulk of the work and pay the lion’s share of the taxes, but their level of affluence gives them a personal stake in the survival of existing political and economic orders
The middle class will work hard, and sacrifice when called upon to protect their way of life.
History teaches us, however, that without such a large and faithful center, class warfare is more prevalent and can destabilize a regime.
So it is no surprise, then, that in U.S. electoral politics, lamenting the decline of the middle class is a common tactic. Barack Obama and Mitt Romney have been accusing each other regularly of responsibility for this decline.
Less clear is how they are defining the term “middle class” and how that definition informs what specifically needs to be done to reverse the trend.
“Middle class,” by contemporary U.S. standards, is when the breadwinner has reliable full-time work with opportunities for skill development and advancement. There is enough income to own a home, support a family of four, put two children through college, and have roughly six months’ worth of income in savings in case of an emergency. Both a health care and retirement plan are provided, as is a two-week paid vacation.
At least that was the reality in America into the 1970s.
Since then, the economy has tended to create jobs at the top and bottom of the employment ladder. Skilled technicians and professionals, especially those who can process and analyze information, continue to do well in the more technological “post-industrial era.”
The top quintile of Americans generally appear to have high skills, high wages, and job security. They now hold 90% of the nation’s wealth and account for virtually all recent income growth.
The other 80% of the working population increasingly fall into what has been called the “secondary labor market,” with lesser-skilled jobs in places such as restaurants, retail stores, and hospitals. These jobs often pay little more than minimum wage; entail few, if any, benefits; involve little to no skill development or opportunities for significant advancement; and are often only part-time.
Not too surprisingly, as Timothy Noah documents in his book, “The Great Divergence,” real wages peaked in the 1970s and there has since been a surge in middle-class bankruptcies. As Paul Krugman put it, “the end of the era in which ordinary working Americans could be part of the middle class moves much closer.”
The large baby-boom generation has reached its peak earning years. The number of multiple-income families has been growing markedly, with two incomes now required to maintain the family status that used to be manageable with one. Individuals are working longer hours and retiring later. Baby Boomers have married later and had smaller families. And, lastly, savings have declined and short-term borrowing increased in an attempt to maintain existing living standards.
To remain viable as a society, then, the United States must be conscious of just how important it is to have a stable middle class. And a reasonable first step could be to reduce further damage by requiring the federal government to assess the middle-class impact of every economic-related policy.
Politicians of both political parties should be willing to pledge that before any taxing, spending or regulatory decision, they would require “middle-class-impact statements.” This would be the equivalent of our environmental-impact statements, which are designed to warn the federal government of potential environmental damage.
Environmental-impact statements were first used in the 1960s to make governmental decisions more informed and rational. It has since evolved and been used in many countries around the world.
Environmental-impact analyses do not require adherence to a predetermined environmental outcome, but rather they require decision makers to account for environmental values in their decisions and to justify those decisions in light of detailed environmental studies and public comments on the potential environmental impacts of the proposal.
A middle-class-impact statement would be extremely useful if it contained, for example, a nonpartisan assessment of how cutting taxes for the top 1% of Americans is likely to affect the size and stability of the American middle class.
Such a statement is not a radically new idea. San Francisco Examiner columnists Barbara Taylor and Mitchell Rofsky were proposing something similar for the city of San Francisco in May of 1995. The Center for American Progress mentioned the basic concept in a recent position paper.
President Bill Clinton suggested a middle-class bill of rights, offering policies to help the middle class sustain their position as well as enjoy real prospects for upward mobility. In October 2009, President Obama created a middle-class task force designed to come up with ways to improve the standards of the American middle class.
Requiring a middle-class-impact statement would simply take such ideas to the next level and require that all federal economic policies first be reviewed to assess their impact on the short- and long-term future of the size and stability of our middle class.
Marcus D. Pohlmann is professor of political science at Rhodes College in Memphis and has written extensively on race and poverty in the United States.
Has anyone used, or know others who have used, the washer dryer combo machines? (I’m not referring to the stack-able kind)
Good/bad/other?
I’ve heard they’re not so great; clothes usually still wet after the dry cycle plus that it takes FOREVER. But that was just one person.
Anyone else?
MEMPHIS, Tenn. (MarketWatch) — The study released last week by the Pew Research Center confirms a trend that political economists have been observing for years — the middle class, the 50% of American households earning between $39,000 to $118,000, are now headed backward in income for the first time since the end of World War II.
49:
Paramus Chevrolet did a similar thing to me. My chevy would not start in Paramus Home Depot so I had it towed there. Security issue with the ignition switch, cheap repair. Oh, but then the body control module was NG also, $700 total. The probability that BOTH those things were bad is next to zero. Its like this: service manager job is high school education, kids need braces, anyone can do it, under pressure to bring in business, what’s a guy to do?
joyce very prevalent in Europe. they have to be vented to dry efficiently. if not the moisture has no where to go. this is why it takes forever for them to dry clothes. they are like a combination anythingin the end you get soemthing that does both tasks but neither of them really well.
Prestige LR, is bad too. They wanted $3000 for new tires at one point and $1700 for rear brakes and discs. I did 4 tires and all 4 brakes and rotors with an independent guy for $1500 total. They charged $60 labor to replace a bulb, I did the other one in a dark garage with no tools in 15 minutes. I broke part of a valve stem on one of my tires and they wanted $300 to replace the sensor, i bought the sensor online for $50 and sears charged me like $20 to change the sensor and remount the tire. Dealers are straight up crooks, I use them only when absolutely necessary.
Jill [35];
I see you’ve recieved today’s talking points E-mail. Good little apparatchik. The meme of the day is Romney cares about tax cuts for the wealthy, not the average Joe.
Here’s today’s ad from the same outfit that accused Romney of killing a laid off steelworker’s wife with cancer… 6 years after the layoff. (http://youtu.be/UPWn42KXG9M?t=12s) Quite the reliable source.
Joyce my parents have one on their boat, it works well but is very slow(ours is vented to the exterior). Still it takes 2.5 hrs to wash and dry a pretty small load. It’s better than nothing, but if possible stack oversize front load units work best.
tirerack.com is a good place to order tires on-line.
jcer says:
August 28, 2012 at 4:52 pm
Prestige LR, is bad too. They wanted $3000 for new tires at one point and $1700 for rear brakes and discs. I did 4 tires and all 4 brakes and rotors with an independent guy for $1500 total. They charged $60 labor to replace a bulb, I did the other one in a dark garage with no tools in 15 minutes. I broke part of a valve stem on one of my tires and they wanted $300 to replace the sensor, i bought the sensor online for $50 and sears charged me like $20 to change the sensor and remount the tire. Dealers are straight up crooks, I use them only when absolutely necessary.
[62] “Has anyone used, or know others who have used, the washer dryer combo machines? ”
Joyce – I had one of those a few years ago when I lived in the city. I think this is the model we had:
http://www.lg.com/us/washer-dryer-combos/lg-WM3987HW-steam-washer
My take: these are great little machines that beat the heck out of going to the laundry room or the laundromat, but the drying is not up to par with what most of us expect here in the U.S.
They can be installed just about anywhere because the do not need to be vented, but the performance of the dryer is very slow, and doesn’t fluff the clothes to get out wrinkles like a vented dryer.
So if you have a choice, go with a standard washer/dryer; but if the combo is the only option, it’s not bad.
The key is patching the tire.You can not plug run flat tires
JJ says:
August 28, 2012 at 4:05 pm
I have more plugs in my run flat tire than Matthew McConaughey has in his head,
Literate BOOYA Bob?
Peshaw Peshaw says:
August 28, 2012 at 9:54 am
All:
Cite all the statistics you want. Sam Clemens was right, “There’s lies. There’s damned lies. And then there’s statistics.”
The Case-Shiller index is a lagging indicator and has been “MANAGED” higher. Think about what’s happened and what’s to come.
Banks refuse to liquidate inventory, refuse to use TARP/TALF/etc, get ZIRP loans from Federal Reserve system.
Realtors greedy w/ excessive price points on the limited inventory.
Appraisers giving near-peak 2006 valuations (excessive).
Townships gladly accept the reflation as basis for increased cash inflow to coffers (to meet mounting pension debts).
Owners are delusional as to the value, regardless of the quality.
Value is driven by demand – there are few qualified buyers.
Look at days on market – Ridiculously long and growing.
Look at pricing history – Constantly being downwardly revised.
Look at property taxes – Near 2006 peak.
Look at energy costs, insurance, etc.
WHERE’S THE NEW HOUSING STARTS?
WHERE’S THE JOB GROWTH?
WHERE’S THE INCOME GROWTH?
WHERE’S THE TAX RELIEF?
Did any of that increased money supply (trillion$$$) go to your pocket? If so, ignore this. Else, WAKE UP! The banks seemingly want/have you in a debt trap – buy a home at inflated value (locks in your basis) and finance it w/ suppressed interest rate (not causing demand), all to get cash flow crunched by inflation (food, energy, commodities, etc).
There’s just no rational reason to justify the price reflation, or to believe that C-S index will hold, regardless of who gets elected.
PESHAW!
[52] yo,
You are confusing averages with individuals. Not everyone would leave, and few have or will. But it is a scale thing: As you turn up the heat on the pot, fewer get into the water and more leave (they aren’t frogs). You also assume that the rules won’t be changed, that we won’t dramatically increase estate or income taxes, or subject more income to taxation. I don’t think anyone looking at our morass is going to assume things stay static.
As for foreigners, if a French magnate can go to Switzerland, Ireland, Caymans or the U.S. to escape 75% taxation, where will he go? Depends on the character of the income and how much is exposed. Here, the U.S. might be attractive in the short term. But if he is doddering and has a large estate, here might not be so good. IMHO, the big driver for expatriation isn’t income taxes, its estate taxes, and that may affect immigration as well.
The articles on foreigners not coming here probably have to do older folks concerned with wealth taxes or entrepreneurs concerned with cap gains rates. Why subject yourself when you don’t have to?
Re: cars,
I think the reason we have leased the last few vehicles is to avoid the service departments. Once the warranty expires, get rid of it and get rid of the headaches.
I will probably go back to getting used cars again, at least for one of our vehicles (or two if I get a pickup).
Be happy….if Germans could stand to put common sense above over-engineering everything making it expensive and impossible to fix on-the-fly, then we would have lost WWII….
daddyo says:
August 28, 2012 at 12:20 pm
My VW jetta was a money sink from day one, and I bought it new.
Never again.
[67] moose,
Jill forgets that she has the power. If she doesn’t want to see greedy businesses or capitalists gain more wealth, she need only convince people like her to stop buying things.
There. Problem solved.
[75] chifi
LOL. So I guess than an Audi and a Tiger Tank have something in common.
[47] gary,
have you noticed that liberals now constantly ridicule their opponents by alleging that they are “projecting”? Seif and Schabadoo (and?) do this a lot, as does this wingnut of a disbarred attorney I know. I just noticed that the Salon article (ever the objective source) is doing it as well.
Yeah Mom, I get to use my Psych degree all the time.
Everything you need to know about the readership of the NY Times and their view of themselves in the context of society…..
Mr. Cohen: You have the great privilege of commanding the audience of the world’s greatest newspaper. Your audience is a large part of the American electorate. How can you, in good conscience, advance the campaign of the party that plans to undo and/or cripple every one of the sustaining programs that most American families utterly depend upon to survive in this time of deep recession, – which that same party created! Mr. Cohen, please re-think your support for GOP candidates. We all hear very clearly what they stand for. Yet you attack Obama, their target for four years, knowing full well you are thereby helping Romney/Ryan. Good Heavens! please confront the full enormity of the disaster that threatens us all from these economically deluded, socially bigoted extremists.
How is this outcome even possible, unless you were aggressively invested in 2000 and 2008, and let everything get crushed, and moved to cash for the bulk of the upswings? I don’t mean to sound harsh, but I can’t really focus on your other points, because this issue sounds overstated for effect, and then used as a supporting fact….
Jill says:
August 28, 2012 at 1:34 pm
I’ve been able to put money away in 401(k) and accumulate because I’ve been lucky enough to work for employers who match. If you take out my company match, the amount I’ve put in over the last 20 or so years has earned just about nothing.
[80] chifi,
I think you answered your own question.
Nom 77 chi fi is right the German Panther tank was arguably the best tank of the war, but it was plagued with problems (research the wheel system for tracks). In addition they were so complicated (German engineering) to produce they could not make in great numbers. It was a copy of the Russian T34, low end but hearty & simple to produce. The Tiger is a different story (I could go on) but I think the Panther is a prime example of an excellent vehicle over engineered by our now German friends.
#64: Service writers get paid on the amount of crap they sell. I used to work for a company that produced motor vehicle service dept. and parts software, so I know the shenanigans. I used to have a guy at Paramus Honda who knew I knew what the deal was and he would always make sure I got only the service I needed on the car (yes, on the car, JJ, so stop it) and nothing else. Then he left and the next time I went there it was $700 worth of repairs they wanted to sell me. Now I just go to my local guy, and I’ll bet I get more miles out of my cars.
Imposter # 60,
F*ck you!
3b – good call on coolidge, looks like they went arip
Thank you, I’ve recently been looking for info about this subject for ages and yours is the best I’ve discovered so far. But, what about the bottom line? Are you sure about the source?
Have been too busy to post, but thought I would share this. The RNC is getting a big WOW from me. How bad is this going to get.
http://news.yahoo.com/blogs/ticket/rnc-hall-young-republicans-wonder-where-beer-011036773.html
As Oklahoma Gov. Mary Fallin delivered her speech at the RNC Tuesday night, three men moved rapidly through the packed crowd on the concourse outside the convention floor, stopping briefly at every concession stand along the way to inspect the menu.
“Beer? Do you have beer?!” one young man asked. His tone was best described as urgent. “Why is there no beer?”
The crew stopped to question cashiers at nearly a half dozen concession stands. Approached by Yahoo News, the men, who appeared to be in their early 30s, declined to say where they were from—though their Stetson cowboy hats and shirts featuring Texas’s Lone Star flag seemed to be a dead giveaway.
“I just don’t understand why there is no beer,” one of the men said. “This is the Republican convention! There must be beer.”
And the search continued…..
Nice post.
With distressed homes yielding smaller discounts and fewer distressed sales coming on the market, home prices have stopped falling.
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Thanks for your post. I also feel that laptop computers are getting to be more and more popular nowadays, and now are often the only type of computer found in a household. It is because at the same time actually becoming more and more very affordable, their computing power keeps growing to the point where there’re as powerful as desktop out of just a few in years past.