From Reuters:
U.S. mortgage delinquencies up in July: Equifax
Rising unemployment continues to make more Americans miss their mortgage payments, a negative sign for the U.S. housing market that has lately enjoyed strong data on sales, prices and mortgage applications.
Among U.S. homeowners with mortgages, a record 7.32 percent were at least 30 days late on payments in July, up from about 4.5 percent a year earlier and 7.23 percent in June, according to monthly data from the Equifax credit bureau.
The rate of subprime mortgage delinquencies rose to 39.48 percent from 39.25 a month earlier, though it is still below levels reached earlier this year, according to the data obtained exclusively by Reuters.
Mortgage delinquencies are driven by three factors, two of which appear to be solved or at least improving, said Dann Adams, president of U.S. Information Systems for Equifax.
First, loose underwriting standards are largely a thing of the past, now that lenders demand higher credit scores and are more careful to verify income. Second, home prices are stabilizing, or even rising, in some U.S. markets, which puts less pressure on home owners.
But the third factor, unemployment, remains a worry.
“Even if it’s in the 200,000 to 400,000 (job losses) a month range, it will be a driver of these delinquency rates,” Adams said. “Until unemployment starts to flatten out and begin to return to hiring, these numbers will probably continue to push up.”
…
Against that backdrop, rising delinquencies suggest U.S. housing is not yet out of the woods.Early-stage delinquencies are a leading indicator of future bankruptcy filings, and Equifax’s July data suggest bankruptcies will continue rising in coming months.
Bankruptcy filings were up 35 percent in July compared with a year earlier, accelerating from both June and May.
Still, while more Americans are late on their mortgage payments, they seemed to be keeping up with credit card bills.
…
Auto delinquency rates rose for the third straight month in July and are up about 13 percent over last year, to 0.75 percent. Subprime auto delinquencies, at 3.19 percent, are also up for three months running.Meanwhile, student loan delinquencies are also up, partly reflecting graduates’ difficulty in landing jobs after college.
From CNBC:
Yoshikami: Rising Home Sales Don’t Equal Recovery
The headlines scream that housing sales are rebounding. Are house prices rising? Yes, a bit.
Granted recent price increases are helpful but after a 40 percent drop in value, a 5 percent gain is a pretty hollow victory. Yes better, but not good to be sure.
Still, some are shouting that it is a new dawn for real estate. Even noted economist Robert Shiller wonders if a new housing bubble will come to pass with low interest rates and subsidies for buyers. But if one looks below the numbers, all is not well with housing and investors would be well advised to keep this in mind.
Yes, housing sales are showing signs of stabilization but if you look closely, mostly contracts are closing at significantly discounted prices. These are distressed properties. Even with some rebound in prices, many of these properties are still significantly under water with mortgages far exceeding current market value.
In other words, someone is losing money. Additionally, there remains a massive backlog of properties (some suggest years of backlog) that still need to be moved out of inventory and placed on the marketplace. Financial institutions are hesitant to release these properties at drastic price reductions, but they will need to eventually as they seek to shore up their balance sheets. A huge supply of properties looms on the horizon.
…
So tread carefully when you read headlines of rebounding real estate sales. The economic news over the last several months suggests things are better but not good. Keep this in mind as you digest data, opinions, and projections.
And take a moment to look around you and absorb the reality on the ground; the world is simply not what it used to be.
From the WSJ:
Mortgage Fraud: A Classic Crime’s Latest Twists
Last summer, Lawrence Ford jumped into the fast-growing market for so-called reverse mortgages. The retired auto mechanic and horse trainer used the money he received to pay off his existing $70,000 mortgage and “piddled away” the remaining $24,000 on things like restaurant meals for his four girlfriends, he says.
Or so Mr. Ford thought. Last month, the owner of the Orlando, Fla., title company that handled his loan admitted to stealing more than $1 million from several reverse-mortgage holders, including Mr. Ford. Bank of America Home Loans, a unit of Bank of America Corp., says the title agent never sent it the money required to pay off Mr. Ford’s mortgage. As a result, Mr. Ford says, the bank recently threatened to foreclose on his seven-acre ranch in Archer, Fla.
“That will put me on the streets with my cars and horses and tools,” says the 68-year-old Mr. Ford. Bank of America, which says there is no immediate danger of foreclosure, adds that it is working with Mr. Ford “to find a home-retention solution.”
In the wake of the mortgage meltdown, regulators and law-enforcement officials are sounding alarms about the potential for yet another type of mortgage fraud—this time, in the small but fast-growing reverse-mortgage market.
From MarketWatch:
Builder Toll Brothers reports $472.3 million loss
Luxury home builder Toll Brothers said it lost $472.3 million, or $2.93 a share in the fiscal third quarter to July 31, compared to a $29.3 million, or 18 cents a share, loss in the prior year’s third quarter.
…
Excluding write-downs, the company’s pre-tax earnings were $3.7 million. Revenue fell to $461 million from $796.7 million. Analysts polled by FactSet had expected a loss of $1.41 a share. “While our FY 2009 third-quarter results reflect continuing challenging housing market conditions, we do see signs for optimism,” said Robert I. Toll, chairman and chief executive officer.
From Bloomberg:
Obama Channeling Reagan Needs 5 Quarters of 7% GDP Growth Surge
President Barack Obama, like Ronald Reagan, has decided to keep a Federal Reserve chairman after what at the time was the longest recession since the 1930s. Unlike Reagan, Obama probably won’t get a strong recovery, or the political boost that it brings.
Under Fed Chairman Paul Volcker, the economy grew at a more than 7 percent annual rate for five straight quarters following the 1981-1982 recession. Reagan, after reappointing Volcker in 1983 and declaring “it’s morning again in America,” won 49 of 50 states in the following year’s election.
Obama is putting his trust in Ben S. Bernanke ahead of time, nominating him to a second four-year term even though the recession isn’t officially over. Growth is forecast to average just 2.2 percent over the next year, according to a Bloomberg News survey of economists this month.
“It’s going to be much, much tougher to jump-start the economy now,” said Stephen Roach, chairman of Morgan Stanley Asia in Hong Kong, who in 1983 was in the first year of his career as a Wall Street economist. “It’s a totally different dynamic playing out today in our post-bubble, overly leveraged world.”
Is the NAR trying to tell us we’re not at the bottom yet?
From HousingWire:
NAR Offers Realtors Certification for Short Sales, Foreclosures
Nearly one-third of all existing homes sold in the last three months were either short sales or foreclosures, according to monthly data compiled by the National Association of Realtors (NAR).
A survey of NAR members indicated distressed sales — including short sales and foreclosures — accounted for 31% of total sales in July and June, down only slightly from 33% in May. In July, 20% of all sales were foreclosures and 11% were short sales, a NAR spokesperson told HousingWire.
In light of the consistently distressed portion of home sales and the role of short sales in the market, NAR unveiled a new Short Sales and Foreclosure Certification Program for realtors. The certification involves a one-day education program completed in person or online, as well as three one-hour Webinars.
Are house prices actually increasing as it says in the CNBC article? Or is it mean price that’s up 5 percent? Is a home that would have gone for 400k now going for 420k? Maybe across the country, but I really don’t think that’s the case in the Philly suburbs.
Any one have a closing date for mls 20925950? thanks!
#6
No prices are not rising, they are falling. You need to look closely at the data to see this. Don’t buy into the media hype, we have another 10% decline in prices to go before this is over.
ChiFi previous thread
Nice bf but I wouldn’t have done that or expected that. My grandmother used to live on Union Tpke at Springfield Blvd. This brought back a lot of memories.
Didn’t Belmar John say this would never happen?
Hammered by bank failures, FDIC may need to draw cash from banks or government
http://www.latimes.com/business/nationworld/wire/sns-ap-us-fdic-shrinking-fund,0,1644675.story
“You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity. What one person receives without working for, another person must work for without receiving. The government cannot give to anybody anything that the government does not first take from somebody else. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is the beginning of the end of any nation.. You cannot multiply wealth by dividing it.”*
Adrian Rogers, 1931
Kass: Market Has Likely Topped
http://www.thestreet.com/print/story/10590765.html
Reggie Middleton:
Thoughts on the June 2009 Case Shiller report: Are prices really improving?
“Well, the Case Shiller index has finally produced a positive print. Again, I will probably sound like a permabear, but this may not be all that it is cracked up to be. I have warned readers two years ago that the Case Shiller index, although an econometric marvel, is far from perfect in terms of determing the state of residential housing in the real world.”
http://boombustblog.com/Reggie-Middleton/1120-Thoughts-on-the-June-2009-Case-Shiller-report-Are-prices-really-improving.html
Afe-MLS#20925950-6 Madison Ct.
Under Contract- 7/24/09
Proposed closing- 12/31/09
Forest Hills, architectural tour of neighborhood:
http://www.slate.com/id/2225748/
Urban planning ahead of its time really.
Real US unemployment rate at 16 pct: Fed official
http://www.breitbart.com/article.php?id=CNG.4452bed82adf3124e5884678e236d7fb.361&show_article=1
Jobless claims at 570k, prior week revised upwards to 580k from 576k.
Q2 GDP at -1%, unrevised.
15 Silera
Thanks for that. I had no idea the Russell Sage Foundation had a hand in that. I used to work there. Uggh.
Veto 16
I am shocked! Really, they wouldnt mislead us about unemployment…… would they?
“Q2 GDP at -1%, unrevised.”
Given the huge revision downward to Q1 why do they even bother reportin the inrevised figures?
Aug. 27 (Bloomberg) — The Federal Reserve may not need to buy the full $1.25 trillion in mortgage-backed securities the central bank has authorized by year-end, Federal Reserve Bank of Richmond President Jeffrey Lacker said.
“With the economy leveling out and beginning to grow again later this year, and with bank reserve demand ebbing as financial conditions improve, I will be evaluating carefully whether we need or want the additional stimulus that purchasing the full amount authorized under our agency mortgage-backed securities purchase program would provide.” Lacker said today in the text of a speech in Danville, Virginia.
I thought the proper price to income ratio was 3 to 1?
————————————
The answer to the problem with housing is simple folks. The price to income ratio must drop to where buyers can actually afford to buy them which is historically three times income. For example, if you make $70k then you can comfortably afford something in the $210k range.
This means one of two things has to happen:
1) Incomes have to rise substantially, or
2) Housing prices must drop to fall in line with incomes.
Since we are in the midst of an economic collapse with soaring unemployment, I think we all know that the second option is the only choice that realistically works.
The only way we got to this point was because Wall Street created Ponzi lending products that enabled us to buy homes that we had no business buying. In the bubbly areas, the price/income soared to 10-1 as buyers used no doc and subprime loans to buy up everything in sight.
http://seekingalpha.com/article/158610-new-home-sales-strong-at-the-right-price
Thanks NJcoast!
Hopium from Bloomberg:
http://www.bloomberg.com/apps/news?pid=20601087&sid=afS8pwr.gnNk
What will they say when there is 575,000 jobs a week lost 1 year from now?
[2]
The story of a horse trainer and four girlfriends….
Archer, Fl is a lovely city (NOT) in the sticks. I would imagine reverse mortgage scams would be rampant in Florida.
Davidowitz says American consumer is gone forever and retailers are in a “death spiral”.
can’t put this genie back in the bottle!
http://finance.yahoo.com/tech-ticker/article/312114/%E2%80%9CIn-the-Tank-Forever%E2%80%9D-U.S.-Consumers-Retailers-in-a-%22Death-Spiral%22-Davidowitz-Says;_ylt=Au3wst7iAUBPil2V9i08i.G7YWsA;_ylu=X3oDMTE2OHF2NHRpBHBvcwMxMQRzZWMDdG9wU3RvcmllcwRzbGsDaW50aGV0YW5rZm9y?tickers=dltr,fdo,ndn,kss,xrt,WMT,CVS&sec=topStories&pos=9&asset=&ccode=
Hoboken market on fire this week. 13 UC this week. Inventory down big time.
http://hudson.fnismls.com/publink/default.aspx?GUID=8ba18407-3d35-468d-ba4a-267a5b2242e0&Report=Yes
Davidowitz is a character, love his interviews on Bloomberg.
From Peter Schiff, slightly older one.
Buy a house or Rent one
I have been a renter for a while. People used to laugh at me for renting my house because I was throwing money away on renting. I had to remind people that I wasn`t throwing money away because I had a great place to live and I did not throw money away on food, on clothing, so I wasn`t throwing money away renting a place to live. I needed to live some place.
rE #15
Tax news of the day:
“U.S. Top Corporate Rate Exceeded
OECD Average for Six Years, TPC Finds
The top corporate income tax rate in the United States exceeded the average top corporate rate of Organization for Economic Cooperation and Development countries from 2000 through 2005, according to Tax Policy Center tables released Aug. 26.
The U.S. top personal income tax rate, meanwhile, remained higher than the OECD average in all years but 2000 and 2003. In 2004, the highest U.S. personal income tax rate clocked in at only 0.1 percent higher than the OECD average, according to the tables, which listed the rates of individual OECD countries as well as the OECD and European Union averages.
In 2005, the top rates in the U.S. were 41.3 percent for personal income tax and 39.3 percent for corporate income tax. The OECD averages were 40.4 percent for personal income tax and 28.6 percent for corporate income tax.”
So much for the liberal argument that Bush dropped taxes on the wealthy. He did, but not in relation to other industrialized nations.
So much for the conservative argument that Obama will emulate European tax policies. We’re already there, and have been for some time.
Davidowitz is best when ripping on “The Gap”.
Buyer 2010
actually, the 1st choice is more likey in the median term. Massive inflation ismore palatble to the TPTB then long term deflation
26 – The last time I had to visit Archer was in 1994, when I was a Guardian ad Litem for a child who lived there. There was one traffic light in the whole town – right across from the Suwanee Swiftee. I don’t think they even had an ABC Liquors.
Schiff Renting vs Buying a House Where is the Real Deal ?
Lost- it’s amazing how forward thinking NYC was in terms of urban planning. So many neighborhoods are perfectly designed and interesting to look at. The Grand Concourse (aesthetically) is just amazing as well.
I feel selfish because even though I grew up in the city, I couldn’t imagine returning to live there with my family. It may be a combination of wanting the “picket fence” I saw as a kid on tv, and that I simply can’t afford it. For what I pay for a house in Jersey I might get 3 bedroom in a duplex in the Bronx with no parking.
There are many articles about people returning to urban living and the death of suburbia. As far as sustainability, I agree but so many are pushed out of the city- as far out as the poconos, because no one was building or developing for buyers that existed.
At this point, I don’t see myself looking to buy an attached home on a 25 x 100 lot in an outer borough for the same price I can get a single family in a commutable North Jersey town. I’m looking forward to buying at 3 times income in about 5 yrs. If I’m wrong, so be it. In the interim, I’m pretty comfortable and I get to park in a driveway when I get home as opposed to circling for 40 min for a spot.
[35] NJ Gator
It’s been a while since I’ve been through Archer but I doubt it has changed. We used to call ABC the All Boy’s Club, bought back memories.
Fellow Gator btw
More Tax News of the Day:
“PARIS—French President Nicolas Sarkozy said Aug. 25 he will propose at the September Group-of-20 summit in Pittsburgh that G-20 governments impose a tax on bonuses to be levied in all G-20 countries, as well as an overall limit on bonuses to a percentage of a bank’s revenues.
Sarkozy said the tax, which would be the same percentage in every country, could be used to finance deposit guarantee funds. The president also suggested a tougher line is necessary to deal with banks’ “excessive behavior” on the subject of bonuses, on the model of what has been accomplished recently with tax havens. . . .
For the G-20, Sarkozy said France would propose a three-pronged approach. “First we want the G-20 to adopt the rules on transparence, governance and responsibility that are now in force in the Paris market place” . . .
Tougher Penalties
Second, he said France will push for the G-20 to implement tougher penalties for banks that do not “play the game.” I will propose that states give no business to banks that do not respect international rules, as we will do in France starting today,“ Sarkozy said.
Third, he said he wants the summit to consider monetary limits on bonuses. “That, everyone knows, can only be done internationally because if we decide all by ourselves to limit them in France, everyone will leave,” he said. . . .”
So, is Sarkosy now in favor of invading Switzerland?
(and I can hear the Swiss response “you and what army?”)
[34] Kettle 1
You actually think incomes will raise in this economy? How so? Without effort from anyone, home prices are falling and will more than likey continue to slowly go down or sideways IMHO.
Are Americans too lazy?
U.S. workers can’t compete globally unless they work harder, writes Fortune’s Geoff Colvin.
[10] dissident
It has happened before, to FDIC, and other bank insurance funds have basically gone out of business (FSLIC and virtually every state fund). So it will have to be recapitalized by you and me and every productive american.
37 Silera
I think there were some very forward thinking developers way back. (I have family that lived on the Grand Concourse in the Bronx. Jeez I haven’t been there since I was a little kid.) What irks me to no end is with all the modern technology we have, developers do an incredibly poor job.
Since DH and I don’t have and will not have kids, the white picket fence is really not a necessity for us. The snobby NYer in me is having some trouble with the concept of living in Jersey. But we have to get the hell out of Staten Island. And since SI is not really NY anyway, I should just get over it. But more then anything, the property taxes in Jersey scare the hell out of me. When I look at homes in certain areas we’d love to move to, I can’t imagine how we’d afford the taxes. I can’t fathom taking a second job just for the purpose of paying property tax.
All I know is if the market crashes the way I suspect it will, I don’t care what DH says, we’re moving to Manhattan.
Buyer 2010
in a matter of years I expect to see inflation run rampant. To infalte the economy like the politicians want requires a substantial amount of inflation be pumped into wages.
Your effective (real) income will be dropping but your nominal income will be increasing.
Although we won’t see that until we finish the deflationary phase first
buyer 2010
dow 20,000 (nominal)
dow 5,000 (real)
Kettle1 what deflation?
Look at this Fed Chart. Notice on the far right? CPI is heading UP already during the recession, any “deflation” has already occurred.
http://research.stlouisfed.org/fred2/series/CPIAUCNS
What we are witnessing is “disinflation” which is likely to LOOK like deflation, don’t be fooled just look at the price of oil or a long term CPI chart.
We are so F-ed………
What Deflation?
Brace yourself: Beer prices are going up
Brewers say rising commodity costs and lower volumes are forcing them to raise its price tags.
Beer drinkers beware: The cost of a cold one is going up.
Brewers across the globe are hiking prices to compensate for lower sales volumes and higher commodity costs.
Anheuser-Busch InBev, the world’s largest brewer and maker of Budweiser, announced plans to raise prices Tuesday.
“We plan on taking price increases on a majority of volume and in a majority of markets this fall,” Anheuser-Busch InBev said in a statement. “The increase helps cover some input costs.”
The U.S.-Belgian brewer said prices will go up “across different price tiers,” including its high and low-end brands.
MillerCoors – the maker of popular beers Miller Lite, Coors Lite and Blue Moon — is also raising prices in some markets. But these hikes are part of the company’s regular fall increases and are “more in line with catching up with costs and commodity prices rather than the economic environment,” said Julian Green, director of media relations for MillerCoors.
The price increases by the biggest brewers is not unexpected, according to Benj Steinman, the editor of industry trade group “Beer Marketer’s Insights.” “What is going to be a little bit out of the ordinary is that they are going to be able to go up less than in a normal year because economic conditions are tighter,” said Steinman.
Heineken, best known for its Heineken and Amstel brands, said Tuesday that its global price increases have helped it turn profits despite sagging volumes.
Going forward, however, Steinman said that Heineken will be hard pressed to continue raising prices. The major competition for the imported brand is Corona, and Corona has said it will not be increasing prices in the tough economy.
Heineken and Corona are struggling more than Anheuser-Busch and MillerCoors — which have 80% of the U.S. market by volume — because beer drinkers are picking out the cheapest drink from the cooler.
“For the first time in a while, it is the lower price brands that are gaining share, and that is definitely because of the economy,” said Steinman.
Anheuser-Busch InBev (ABI) was formed in November 2008 when InBev, which brews Beck’s and Stella Artois, bought St. Louis-based Anheuser-Busch for $52 billion.
The looming price hike comes as sales volumes in the brewing industry have declined. Anheuser-Busch InBev said earlier this month that total beer volumes were down 1.5% in the second quarter versus the same period last year.
Heineken, based in Amsterdam, said Tuesday that price increases helped the company offset the pull back in consumption. Heineken makes and brews 170 international beers and ciders, but is best known for its brands Heineken and Amstel.
“The economic and trading conditions remain difficult, and there will be continued pressure on volumes in the second half of 2009,” CEO Jean-François van Boxmeer said in a statement.
http://money.cnn.com/2009/08/25/news/companies/anheuser_busch/index.htm
If I have to pay in excess of ten dollars for a six pack of delicious Number 9 elixir I am going to be cranky.
Unrelated: You too can learn to be a serf!
http://2.bp.blogspot.com/_H2DePAZe2gA/SpX2GVtBL5I/AAAAAAAAJpo/8ZUMvIK48tM/s1600-h/learn-to-be-a-serf.png
I hope prices on Abita don’t go up. Will prices on imported beer go up? I don’t want to pay more for Franziskaner.
[41]
Not to worry. I have pointed out that Chairman O and the rest of the Pelosi Politburo’s policies cannot succeed without protectionism.
Economic laws work within a system. Globalization expanded the size of the system. Without barriers, water seeks its own level, and this is true in economies. Globalization eliminated the barriers at the borders, so water has long been seeking its own level.
This protectionism will have the beneficial side effect of preserving the pedestal that the american worker occupies, and which globalization threatens to bring down.
Sean,
CPI is only 1 facet. When we are seeing the evaporation of trillions of dollars of “wealth” from housing and trillions of dollars from the finance industry, that is not “disinflation”
If you base your definitnion off of CPI then i would agree with you. But i define inflation/deflation on the total money supply which includes all the various ABC debt instruments that are now worth pennies on the dollar.
It is estimated that between housing and finance we have seen 10 – 20 trillion in wealth cease to exist as values are written down and loans default.
Abita and Magic Hat #9. Nice!
Couldn’t get enough of the Abita when I was down in New Orleans with Gator last year.
I’m still a sucker for the English/Scottish/Irish stuff still. McEwans, Guiness, Boddingtons and Smithwicks are my standbys. When I’m cheap and drinking to get drunk, Molson Canadians!
Sean,
deflation doesn’t require prices across the board to drop. Deflation doesn’t suddenly trump the supply demand dynamic that occurs in markets.
prices can and will continue to fluctuate whether there is a deflationary or inflationary market environment.
In my lay opinion the dynamic that is confusing s that cheap credit kept prices low. now that the credit is expensive and in limited supply prices will go even as deflation occurs. You can already see wages going down across the board.
In the end deflation and inflation end up at the same place. deflation is just an uglier ride
52 Stu
Every once in a while I find a beer distributor around here that has Abita so I stock up. I’m partial to the Purple Haze but DH likes Amber or Turbodog. And then there’s the seasonal strawberry ale. Yum!
…prices will go up even as deflation occurs
Kettle1 – “Debt Deflation” is not deflation.
You blinked and you missed it, we have had massive unemployment massive demand destruction yet prices are going up, and up!
Fed Chairman Ben Bernanke has succeeded in his bid to prevent deflation from developing into a macro economic price deflation spiral.
Prices are going up Commodities,Oil, Food and packaging and portions are getting smaller and smaller that is inflation my friend.
Nom,
Is Wachtell Lipton’s Ed Herlihy On The Hook For The Merrill Bonus Fiasco?
http://www.zerohedge.com/article/wachtell-liptons-ed-herlihy-hook-merrill-bonus-fiasco
Stu
Do a search on Abita’s site. You can find places close to you that carry it. I’m going to have to go to the local Key Food and see if its’ actually there.
A week is never complete until Frank provides the update on the fires raging in Hoboken … [28]
wish this stock market would take a dive already. its spirtaling so high that its actually scaring the consumer. Even joe plumber is scratching his head.
#43 – lost – The snobby NYer in me is having some trouble with the concept of living in Jersey. But we have to get the hell out of Staten Island.
If you’re looking to get away from SI as a state of mind you may be out of luck. Honestly, most of central Jersey is just as bad, if not worse. You get the guido and the nascar crowd at the same time. It is an un-ending festival of ignorance.
Right now I am semi-seriously entertaining a move to St George. More logically a move to Brooklyn in about 3 years.
Toys ‘R’ Us launches Cash for Clunkers, baby-style
Get with the program folks, Sue Adler says we are now in “The Buying Zone” as determined by “The Housing V.”
Tosh,
St. George is not eactly a nice hood. Try the South Shore side of Staten Island, or Grasmere. Grasmere is a 20 minute bus commute to downtown.
Retail maven Howard Davidowitz paid another visit to Tech Ticker this week. And despite signs of improvement in consumer confidence and retail stocks rising, Davidowitz is steadfast in his belief the consumer is dead.
Rather than summarize, let me just highlight some of his best one-liners:
On retail:
“The retail business is terrible… It’s almost all negative.”
“We’re going to close hundreds of thousands of stores.”
On the consumer:
“They’re still over leveraged, they’re losing jobs, their credit has been cut back.”
On America:
“We are in the tank forever. As a country we are out of control, we’re in a death spiral.”
On the stock market:
“We’re in terrible shape. That’s what the fundamentals tell me. I can’t explain the stock market.”
Sad, but close to the truth!
HE (21)-
All gubmint economic announcements are made for the sole purpose of gunning the stock market.
That ends today’s version of Simple Answers…:)
“Given the huge revision downward to Q1 why do they even bother reportin the inrevised figures?”
61 Tosh
Understood. But because DH works in Jersey moving to Brooklyn is not an option. If he didn’t work in Jersey, we would have moved to Brooklyn years ago.
St. George is still iffy unless its Bay St. Landing. And people in there still think its 2005 with their pricing. Well a lot of people still think its 2005 in SI.
Cool. Builders making plea online via YouTube.
Home Builders Plea to Congress to Save the Housing Market
64 Make
The only people moving to the South Shore of SI are the Brooklyn versions of The Sopranos. I wouldn’t move back there Tony Soprano himself threatened me.
Lest people think Adler is an anomaly in her deception and deceit, to the contrary, she is celebrated by her employer:
http://www.linkedin.com/in/sueadler
Sue Adler (www.SueAdler.com)’s Honors:
#1 Keller Williams Agent in New Jersey 2005,2006,2007,2008
#5 Keller Williams “Individual” Agent Internationally 2007
New Jersey Circle of Excellence Gold Award 2005,2006
New Jersey Circle of Excellence Platinum Award 2007,2008
Formerly the #2 Re/Max agent in Pennsylvania before moving to NJ in 2002.
Participate in Keller Williams International’s “invitation only” Internet Marketing Mastermind Groups & Summits on Lead Capture, Cultivation & Conversion.
Have spoken on several panels at Keller Williams National Real Estate Conventions on “Driving Traffic to your website”, and “Internet Lead cultivation & conversion.”
come on now SI,, beauty,,,
#64 – make – I’ll just second lost’s comments in #69.
I don’t mind the ‘sketchiness’ of St. George. If I did go back to SI it would have to be somewhere within walking distance to the ferry. Honestly, the express busses in to Manhattan are generally awful.
lost (49)-
Prices for Everclear haven’t risen for almost 20 years.
It’s a quick, effective and surprisingly tasty drink.
Sean
we are using different definitions. Per your definition I agree with you. BUT, I ultimatly disagree with your definition as or leads to nonsensical situations (I.e. Cookie infaltion).
The total money supply which must include leveraged debt instruments since they are counted as income/ assets, is still falling through the floor.
Individual price action by itself is not an indicator of inflation or deflation. At the scale of insisivual prices global market dynamics are the dominant driver not money supply.
You can see deflation as people shift there increasingly limited income away from discretionary expenses such as shopping and eating our and towards core essesntials.
You are
missing that inflation as you define it is meaningless to the average Joe as their wages are not going up through increased pay or through access to substantial amounts of increasingly cheap credit.
The credit well has run dry.
I think we will see substantial inflation in most market segments at some point but not until the rate of deleveraging and debt destruction slows
73 Clot
That’s good news because when I make Hand Grenades at home, the mix requires Everclear! Woohoo!
vodka (51)-
I’m with Mish on this one. No talk of deflation can exclude discussion of the contraction of credit extension.
The destruction of debt and contraction of credit explains how Bergabe can print 24/7, yet not even a whiff of inflation is out there.
That’s also your confirmation that we’re already in a deflationary depression.
Prices for Everclear haven’t risen for almost 20 years. It’s a quick, effective and surprisingly tasty drink.
Yes, and in a pinch you can use it to de-grease cam shafts.
Lost (69),
sorry. I had a feeling it had changed.
Give me a Leinenkugel any night of the week. One of America’s greatest breweries.
43 – The snobby NYer in me
Unless you own a minimum of 2 acres in Greenwich CT, and your house cannot be seen from the road, you are a loser in the NY Metro area.
kettle1 says:
August 27, 2009 at 10:12 am
your IQ
135(nominal)
97(real)
#69 – lost – But because DH works in Jersey moving to Brooklyn is not an option.
Would western Jersey be an option? Obviously the commute would be the limiting factor here, but, there are a lot of very pretty areas of Hunterdon, Warren and Sussex. I’ve seen fairly inexpensive rents for some houses if you didn’t want to buy without test driving the area first.
Albani (81),
Care to comment on my IQ too.
lost (75)-
Do you mind e-mailing me your grenade recipe?
Here’s an apellate court decision on a dispute between Realtors, interesting not so much because of the legal stuff, but because of the behavior of the parties:
http://www.judiciary.state.nj.us/opinions/a1264-08.pdf
It tends to confirm what people think of most Realtors.
Speak of the devil…looks like Mish has the latest Hoisington and some more comments on the deflationary spiral today:
http://globaleconomicanalysis.blogspot.com/2009/08/creative-destruction.html
WSJ
AUGUST 27, 2009
New Jersey Corruption Bust Had Deep Roots
Arrests Following a Series of Investigations Make Official Malfeasance a Central Issue in This Year’s Gubernatorial Campaign
By SUZANNE SATALINE
OCEAN TOWNSHIP, N.J. — A statewide corruption investigation that has entangled dozens of New Jersey politicians had its origins a decade ago inside a dingy trailer office in Monmouth County, where federal agents overheard talk about bribes to local officials, some involving real-estate deals.
The wiretaps of phones in the trailer eventually led to the arrests and convictions of a half-dozen public officials and sparked two other probes that have since ensnared nearly 80 politicians, most of them Democrats, and fixers, businessmen and others. The key figure in last month’s dramatic arrests of 44 people, real-estate developer Solomon Dwek, first came to investigators’ attention through his connections with officials ultimately convicted in Monmouth County, according to a person in law enforcement familiar with the case.
The three-round investigation — referred to by prosecutors as Bid Rig I, II and III — has catapulted corruption into a central issue in this year’s gubernatorial race. Presiding over most of the investigations was Chris Christie, a Republican who served as U.S. attorney for New Jersey from 2002 until December, when he resigned to run this fall against Democratic Gov. Jon Corzine.
For many, Bid Rig has reinforced New Jersey’s reputation as a cesspool of corruption, where multiple layers of government officials wield vast power and their friends and family get jobs and contracts. This behavior isn’t limited to New Jersey, of course, but the large number of high-level officials arrested in the state in recent years has underscored the perception that it is entrenched here.
A man identified as Daniel Van Pelt, a New Jersey assemblyman, shields his face as he leaves a Newark, N.J., courthouse in July after being one of more than 40 people arrested in a corruption probe. Mr. Van Pelt later resigned but said he hoped to prove himself worthy of the public trust.
new jersey corruption politcis
new jersey corruption politcis
“The further you get away from New Jersey, they can’t conceive that there’s a state where they allow this kind of stuff to go on,” said Bob Ingle, a former reporter and chronicler of New Jersey corruption through a Web site and a book he co-wrote, “The Soprano State.”
The first Bid Rig began in 1999, when Robert Steffer, a former contractor and a longtime Federal Bureau of Investigation informant, wore a wire and visited the Neptune trailer of Philip Konvitz, a Monmouth County power broker, said Mark McCarren, an assistant U.S. attorney who has prosecuted individuals in every stage of Bid Rig.
Mr. Steffer told people he was looking for contracting work and was willing to pay local officials to refer him any jobs. In truth, he was listening for evidence that public officials were taking bribes, according to Mr. McCarren.
“We had multiple sources indicating Konvitz was a guy who dealt in corrupt ways with local officials…and he did so out of this little business — a converted trailer,” Mr. McCarren said. Mr. Konvitz, he said, was “worth hundreds of millions.” Mr. Steffer couldn’t be reached for comment.
[new jersey corruption and politics]
Mr. Konvitz, who died in 2005 at age 95, had a reputation in Monmouth County as a fixer with powerful friends. “He was just like the Godfather; when you wanted to get something done, he was the guy who could tell you how to get it done,” said Elmer Kendrick, an Asbury Park used-car dealer who said he had owned a piece of property with Mr. Konvitz.
Listening to wiretaps, agents heard Mr. Konvitz persuading Terrance Weldon, the former mayor of Ocean Township, to change zoning on a tract of land, increasing its value, according to federal court documents.
Mr. Weldon pleaded guilty in 2002 to extorting bribes, including one for $50,000 from that land’s developer, accepted weeks after Mr. Weldon voted for the zoning change. The former mayor became a cooperating witness for the government but received a prison sentence of more than four years.
Mr. Konvitz was indicted in 2002 on charges of extortion, bribery and mail fraud, including the transaction with Mr. Weldon. A judge dismissed the charges after Mr. Konvitz was declared unfit to stand trial.
Around 2000, agents investigating the Weldon case also learned that Mr. Dwek, a local Jewish day-school educator and real-estate magnate, had close ties to Ocean Township officials, especially Mr. Weldon, the person familiar with the investigation said. Mr. Dwek paid bribes to several politicians in Monmouth County, including more than $10,000 to Mr. Weldon, as he sought approvals for some of his property, the person said, although Mr. Dwek was never charged for these alleged incidents. Mr. Dwek’s lawyer hasn’t returned numerous calls seeking comment.
A tip to federal agents in 2002 led to the second stage of Bid Rig. Police in the Monmouth County borough of Keyport learned that a local trash hauler, under investigation for double billing, was being shaken down for business favors by a councilman, according to Tom Mitchell, now Keyport’s police chief, who was involved in the investigation. Mr. Mitchell said he shared the information with the FBI, which again dispatched Mr. Steffer.
Mr. Steffer began in 2003 offering bribes to local officials while posing as a wealthy contractor and loan shark with mob ties. Fifteen current and former officials in Monmouth County were arrested in 2005, including John Merla, the Keyport councilman who had become mayor in 2003. Mr. Merla in 2007 pleaded guilty to federal charges of extorting bribes in exchange for awarding no-bid contracts.
Bid Rig’s latest chapter kicked off in 2007, with the help of Mr. Dwek. A year earlier, Mr. Dwek had been charged with bank fraud, after he cashed a $25 million bad check at a drive-through teller. Agents recognized his name from the earlier investigations. In debt, and facing prison, Mr. Dwek was persuaded to become a confidential informant, people familiar with the matter say.
Posing as a developer, Mr. Dwek began offering money and campaign donations to North New Jersey politicians and operatives, in exchange for special consideration for his supposed real-estate projects, according to people familiar with the case. The undercover work led to the arrest of 44 people in July, including mayors, rabbis accused of money laundering and a New York City man accused of trafficking human organs. Trial dates haven’t been set.
make money says:
August 27, 2009 at 11:37 am
Albani (81),
Care to comment on my IQ too.
?
Racketeering 101: Bailed Out Banks Threaten Systemic Collapse If Fed Discloses Information
http://www.zerohedge.com/article/racketeering-101-bailed-out-banks-threaten-systemic-collapse-if-fed-discloses-information
Make nope no change.
80 ruggles
Speak for yourself.
re #89 – Arguments in court Yesterday were we aren’t sure if we even have the information that Bloomberg requested, to we need a stay in-order to have more time to consider if we are going to appeal.
The Fed will appeal by Monday or Tuesday, nothing and hope they can keep stalling for the next administration to clean up the mess.
re #74 – Kettle1 so the text book definitions of inflation and deflation don’t fit your stream of thoughts, so you change their meanings?
Give it up man, the Deflation scenario is dead for now, Bernake saved us from it.
Reich: Deficit Too Small, Government Should Spend More
The U.S. government is expected to report a budget deficit of $1.6 trillion for the fiscal year ending Sept. 30, a figure that is actually quite small, according to former Labor Secretary Robert Reich.
In fact, even more government spending is needed to get the U.S. economy going again, says the Clinton-era figure.
“It strikes me as alarmingly small,” Reich said on his blog.
“I’d prefer the government run a larger deficit. With unemployment and underemployment still rising, consumers still pulling away from the malls, business investment still in the basement, and exports still dead, the federal government has to spend more — and the deficit has to be larger — in order to get people back to work.”
New figures show hefty government spending could push the overall national debt, now more than $11 trillion, to close to $20 trillion in 10 years. The debt is the total sum the government owes, while the deficit is the yearly gap between revenues and spending.
According to Reich, public spending as a percentage of the overall size of the U.S. economy has been large in the past and the economy always found a way to rebound.
http://moneynews.newsmax.com/financenews/reich_spend_deficit/2009/08/26/252664.html
I found most parts of SI to be sketchy at best. However, I have some friends who reside on Lighthouse Hill (next to LaTourette golf/park) and its a very nice area!
CLot,
76
that is exactly my point. we are saying the same thing.
Chi 81
you only hurt those you love, right ?
its good to know you care :)
Sean,
the definition i am using for deflation/ inflation is not my own, its the same one that clot’s favorite blogger (mish)and may other “professionals” uses as well. I am not making up my own definitions.
Multiple meanings of inflation/deflation are used interchangably on a regular basis, hence the confusion.
We can certainly agree to disagree. nothing wrong with that.
But a question…..
Do you think that 10’s of trillions of value being lost throughout the market is outweighed by bergabe printing 1 trillion or so and playing accounting games?
the 1 trillion is a start, but the accounting games only kick the can down the road and do not actually solve anything. Unless all of those formerly AAA MBS and the like rise from the dead and back to AAA then the accounting games are ultimately ineffective.
#8 Grim,
You’re predicting only a 10% decline? Wasn’t Deutsche Bank predicting a 40% decline in the New York Metro Area? (Specifically, I thought they were betting on 40% decline from Q1 prices from this year.) That’s a big disparity, right?
re: kettle – chico relation. i recall chico mentioned on this blog that he was attempted by an old greek man. now he think it’s his turn to the younger kettle.
I find the last sentence in the article troubling. I’ve noticed lots of article recently mentioning graduating college students coming out of college without a good job and tons of debt.
I even read one story recently about a student who couldn’t get a job and decided to sue the school for the amount of money he paid in tuition.
82 tosh
No Western NJ is too far. I know it’s a cheaper option but it doesn’t really work for us.
FYI AIG….WTF?
89: But the banks all received a clean bill of health from Timmay. I’m sure it’s all copacetic.
84 clot
You have to order the mix from Tropical Isle. The recipe is on the package.
kettle1 says:
August 27, 2009 at 12:30 pm
Sean, We can certainly agree to disagree. nothing wrong with that.
ket: again on the topic of passive-aggressive and hypocrisy…..another one of your empty comments with no meaning, since you don’t really believe this when you post it….
91 – just suggesting that snotty new yorkers get looked down on just the same as us jersey losers.
EW,
Post #8 by Gman not Grim.
BTW, I hate blogging from my iPhone.
#108
Oops! Thanks. I didn’t get much sleep last night! Sorry for the mistake.
yo’me (94),
reich has to be long shiny.
Another short, sweet piece of brilliance from that Mish article:
Money Multiplier Theory
“Conventional wisdom regarding money supply suggests there is massive pent up inflation in the works as a result of the buildup of those reserves. The rationale is that 10 times those excess reserves (via fractional reserve lending) will soon be working its way into the economy causing huge price spikes, a collapse in the US dollar, and possibly even hyperinflation.
However, conventional wisdom regarding the money multiplier is wrong. Australian economist Steve Keen notes that in a debt based society, expansion of credit comes first and reserves come later.
Indeed, this is easy to conceptualize: Banks lent more than they should have, and those loans are going bad at a phenomenal rate. In response, the Fed has engaged in a huge swap-o-rama party with various banks (swapping treasuries for collateral of dubious value) in addition to turning on the printing presses.
This was done so that banks would remain “well capitalized”. The reality is those excess reserves are a mirage. Banks need those reserves for credit losses coming down the pike, as unemployment rises, foreclosures mount, and credit card defaults soar.
Banks are not well capitalized, they are insolvent, unwilling and unable to lend.”
lost (105)-
I’m not looking for recipes for the drink call Hand Grenade. I’m looking for your recipe for the kind where you pull the pin, throw it, and it goes boom.
Government’s Money-Manipulating Wizardry
There’s great debate about inflation versus deflation. Most who are buying stocks aren’t doing so because they see good fundamentals, but are doing so because they’re worried about inflation. Clearly the Federal Reserve is doing “unconventional” things (perhaps I should use better words such as crazy and irresponsible) which have a lot of people worried about a crashing dollar.
http://www.minyanville.com/articles/minyanville-moneydebt-Fed-inflation/index/a/24267
Re: 47, 48, 49
I’ve already seen beer prices increasing over the past 6-12 months in the microbrewery catagory.
Sorry Lost, Franziskaner is owned (ultimately) by InBev.
Chi,
Sliding in at #17 :))
http://men.style.com/gq/features/slideshow/v/0909COLLEGE
[107] ruggles,
Very true. In fact, I look down on everyone in the tri-state area and mid-atlantic.
[115] WWFB
That is one reason I have been stockpiling bottles. Soon I hope to dust off (and clean really well) the homebrewing supplies. With two carboys, I can keep batches going. The only thing limiting me is a supply of bottles. Currently, I have less than 4 cases worth, and I don’t drink enough fast enough to accumulate them.
May be unseemly in Brigadoon, but maybe I should pick over my neighbor’s recycling on trash nights. Not too proud to scrounge for the free stuff.
Hmmm. A homebrewing GTG may be in order. I wonder if Captain Cheapo would be up for that?
Absolutely Nom, but I want you to ensure that my bottles are cleaned.
Republicans Complain Obama Will “Bury” Our Children With Reagan Era Debt Burdens
That could have been the headline of an article on the new economic and budget projections. After all, the article included a quote from John Boehner, the leader of of the House Republicans: “the Democrats’ out-of-control spending binge is burying our children and grandchildren under a mountain of unsustainable debt.”
If we look at the latest projections from the Congressional Budget Office (CBO), they show that the interest burden of the debt in 2019, the last year for their projections, will be $722 billion. That comes to 3.4 percent of projected GDP.
If our children will be buried under this burden, then their parents must have been comparable strangled by the debt burden created in the Reagan-Bush presidencies. The interest burden from the debt run up in these years peaked at 3.3 percent of GDP in 1991.
It would be helpful for readers to put these budget and deficit projections into some context. Unlike reporters, most readers do have other jobs. Therefore they may not have the time to look up the data that shows Mr. Boehner’s complaint is just empty rhetoric.
–Dean Baker
[113] clot,
As your phony baloney counselor, Atty. Lepitome, I suggest you ixnay the enadegray talk, lest you get Grim into trouble. The First Amendment isn’t nearly as comprehensive as many think.
crashing dollar = increase inflation no?
So now Clot can’t make anarchy jokes while Frank gets to yell ‘fire’ in Hoboken?
Market is rallying! Somebody forgot to plug in the HAL 3000 this morning.
[123] stu,
A. Frank is not professing to start actual fires. At least I don’t think he is.
B. No one here takes Frank seriously. Why should the government?
C. espousing anarchy generally is fine; preparation isn’t.
Option ARMs Are Bad News for Mortgage Holders, but Will Have Little Impact on the Market
The NYT had an article talking about the round of option adjustable rate mortgages (option ARMs) that will be resetting over the next few years. The headline of the article is: “adjustable mortgages loom as threat to housing recovery.” This is not supported by the evidence presented in the article.
The article cites estimates produced by FirstAmerican Core Logic, that 600,000 option ARMs will reset over the next four years. This is a rate of 150,000 a year. Even if all these mortgages defaulted and went into foreclosure, it would increase the rate of foreclosures by about 6 percent. Realistically, it is unlikely that more than half of these mortgages will end up in foreclosure. While this is not trivial, it is not large enough to qualitatively change outcomes in the housing market.
–Dean Baker
yo’me
what Dean Baker fails to recognize is that the situation dating back to 1980 has never gotten better. It’s only metastasized into a bigger problem and it’s scale of growth has increased rapidly in the past 10 years. The number one way to reverse coarse would be to shrink government and stop wasting a trillion dollars a year on maintaining overseas military bases. We have a democratic majority in the house/senate and a President who was supposedly opposed to war in the middle east. What did they do? Scale up the military budget. If we can’t even get the far left to scale down the military budget, the problems faced will easily drive us off a cliff into currency collapse. This is what always happens when a government grows too big. With decades of fiscal and trade deficits and an administration that is 100% Keynesian, this is simply the touch of death to the currency.
re #98 -Kettle1 – Don’t be carried out on your shield on this one.
Do you think “lower prices” are coming?
If you are going to use Mish’s musings then you will be carried out on your shield especially if you trade that way.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/08/27/BABD19E5J6.DTL
Here goes UC Berkeley with financial woes. they waste tax payers money and student money on courses like “Earthquake in your backyard”.
Are you frikking kidding me. We deserve all we are going to get.
August 27, 2009
Unemployment Insurance Claims: Let’s Get Some Perspective
The NYT article on weekly unemployment insurance (UI) claims carried the surprising headline: “first-time U.S. jobless claims fall again.” The reason the headline is surprising is that claims rose the prior week, from 561,000 to 576,000, a number that was revised up to 580,000 in the new report. So, claims did not fall again.
This article makes the point that new UI claims, which have averaged 566,000 over the last four weeks, are down sharply from the peaks hit in April. However, it is worth noting that these are still extraordinarily high levels of claims. In a healthy economy, we should expect to see weekly claims in the low 300s. Also, the current rate of claims can be consistent with a very rapid pace of job loss.
In November of 2008, when the economy lost 597,000 jobs, weekly UI claims averaged 520,000. In December, when the economy lost 681,000 jobs, UI claims averaged just over 550,000. It is obviously better to see UI claims averaging 566,000 than the 650,000 weekly average that we saw earlier this year, but in other times, weekly claims at this level would be really really bad news.
–Dean Baker
Posted at 01:12 PM | Comments (0)
Investment Firms Make Money the Old-Fashioned Way: They Bribe People
USA Today had a nice piece this morning reviewing an interesting habit of investment management firms, of contributing large amounts of money to elected state officials who have control over the investment of pension fund money. For those trivia fans out there, yes, well-known billionaire and Social Security foe Peter Peterson is on the list of big givers.
–Dean baker
Posted at 05:54 AM | Comments (6)
August 26, 2009
Option ARMs Are Bad News for Mortgage Holders, but Will Have Little Impact on the Market
The NYT had an article talking about the round of option adjustable rate mortgages (option ARMs) that will be resetting over the next few years. The headline of the article is: “adjustable mortgages loom as threat to housing recovery.” This is not supported by the evidence presented in the article.
The article cites estimates produced by FirstAmerican Core Logic, that 600,000 option ARMs will reset over the next four years. This is a rate of 150,000 a year. Even if all these mortgages defaulted and went into foreclosure, it would increase the rate of foreclosures by about 6 percent. Realistically, it is unlikely that more than half of these mortgages will end up in foreclosure. While this is not trivial, it is not large enough to qualitatively change outcomes in the housing market.
–Dean Baker
Posted at 10:32 PM | Comments (12)
Fox on 15th (a.k.a. “The Washington Post”) Editorializes Against Obama on Front Page
Departing from normal journalistic practices, the Washington Post devoted its lead article to an editorial criticizing the Obama administration’s budget policies. The headline of the piece, ostensibly an article on new projections from the Congressional Budget Office, is “Deficit Projected to Soar With New Programs.”
In fact, the main cause of the increase in the deficit in the latest projections is not “new programs,” the main cause of the increase is worse than expected unemployment and growth numbers. A more neutral account of the projections would have highlighted the fact that the Congressional Budget Office now expects the unemployment rate to average 10.2 percent in 2010. It previously had projected that unemployment would average just 9.0 percent, even without the benefit of a stimulus package. The article does not discuss this sharp deterioration in economic projections until deep into the jump page.
The article also wrongly includes the assertion that: “deficits of that magnitude [the projected deficits for the end of the projection period] would require dramatically more government borrowing from China and other creditors,…” It is the trade deficit that requires borrowing from China (more precisely, lending from China causes the trade deficit by raising the value of the dollar), not the budget deficit. The Post should stop making such xenophobic assertions.
The Post also notes that China has expressed concern that it may lose money on its dollar investments. Presumably it knows that it in fact will lose money on its dollar investments. The dollar is virtually certain to fall in the years ahead since is trade deficit is unsustainable. This means that the Chinese will be paid back in dollars that are worth considerably less than the dollars they lent. China may be willing to accept this loss to sustain their export market in the United States. The public expressions of “concern” are most likely for public relations purposes. (Governments don’t generally express their real concerns in public forums.)
–Dean Baker
Posted at 08:08 AM | Comments (32)
WSJ Warns That China May Stop Manipulating Its Currency
In an article on the new economic and budget projections released yesterday, the WSJ warned that China and other international investors “are growing bolder about questioning whether they will keep buying U.S. government debt at today’s voracious levels.” The Chinese government keeps down the value of its currency against the dollar (an action often described as “manipulation” by politicians and in news stories) by buying U.S. government debt. If it stopped buying U.S. debt, then its currency would rise against the dollar, reducing the U.S. trade deficit with China. This is exactly what both the Bush and Obama administration publicly claim to support, so it is difficult to understand why the public should be worried about getting what we claim to want.
The article also confuses the trade deficit and the budget deficit. Foreign capital is needed to finance the trade deficit. In the absence of an inflow of foreign capital, the dollar would fall, as noted above. This would make imports more expensive (just as a tariff would), and make our exports cheaper to foreigners. As a result, the trade deficit would fall.
Foreign capital is not needed to finance the budget deficit. In a context where the economy is below full employment, as is projected to be the case for the next five years, the Federal Reserve Board can finance the budget deficit by directly buying debt, as it has been doing. It would have been helpful if the article pointed out this fact, since there have been huge efforts by Obama administration critics to spread misinformation on this topic.
–Dean Baker
OOpps I did it again! Sorry Grim
The Debt to GDP Ratio is Not About to Reach a Post War High
The NYT attributed an inaccurate assertion to the Treasury that: “debt as a percentage of G.D.P. is rising and nearing a postwar high.”
Even counting the debt held by trust funds, the debt to GDP ratio is only around 70 percent of GDP. It was near 120 percent of GDP ($18 trillion in the current economy) immediately after World War II.
–Dean Baker
Interesting comments from Dean Baker
http://www.prospect.org/csnc/blogs/beat_the_press
So all these people in Fort Lee who listed at 2005 prices will now raise their prices by 5%. It seems that they are not at all bothered that their houses have been sitting for over a year on the market.
Great NYer article this week on inability of NYC to fire blatantly incompetant teachers. NYC is spending $100MM per year on teachers whom they will not allow to set foot in a classroom. These people (there are about 1700 of them) sit in empty conference rooms around the city all day (except during summer and holidays, which they have “off”) and get full salary and benefits, and the time spent in these rooms (often many years) fully counts toward pension.
Just something to think about when politicians tell you they need to raise taxes.
#132
“Even counting the debt held by trust funds, the debt to GDP ratio is only around 70 percent of GDP. It was near 120 percent of GDP ($18 trillion in the current economy) immediately after World War II.”
does this count the obligations of the GSEs?
“Even counting the debt held by trust funds, the debt to GDP ratio is only around 70 percent of GDP. It was near 120 percent of GDP ($18 trillion in the current economy) immediately after World War II.”
Give it another year. A second round of stimulus, 500 additional bank failures, an escalating war in Afghanistan, larger suicide bombings in Iraq and of course bailouts for the writedowns on alt-a and commercial RE. We’ll get to that 120% number soon enough. As unemployment claims run out and businesses continue the act of laying people off to supposedly increase earnings, we’ll get to that number.
[135] skep,
Sounds like a great gig:
1. Get your teaching cert,
2. get assigned to a class,
3. tell an urban student that mouthed off to you to STFU;
4. get assigned to Romper Room
5. Bring your laptop and cellphone; and
6. Continue to day trade; practice law; prepare taxes or financial statements, work on your novel; proofread term papers; etc.
7. Get paid.
Essentially, it is paying you to relocate your office to the local teacher Romper Room for an extended period. For certain professions, this could prove very lucrative. Wonder how much unreported income got made in the NYC romper rooms?
I would have mentioned health care reform, but that ain’t gonna happen. It’s merely a circus to entertain you as the scum at GS picks your pockets.
Chifi,
again on the topic of passive-aggressive and hypocrisy…..another one of your empty comments with no meaning, since you don’t really believe this when you post it….
you are clearly a smart guy, but this is getting old already.
I enjoy debating with others and often learn from the experience. In the end whether or not i agree with the other person is irrelevant. The challenge of defending a position and the opportunity to learn something new, whether a weakness in your position or entirely new material is the entire point of the exercise.
I have no ill will towards sean and the debate is not a personal matter for me, but an intellectual one. i do not have personal emotions tied into the argument as you seem to chifi.
you seem to be internalizing the debates on this blog way to much my friend.
At the end of the day i would be just as happy to have a beer with you regardless of who is wrong and who’s right
Dean Baker overload
“Even counting the debt held by trust funds, the debt to GDP ratio is only around 70 percent of GDP. It was near 120 percent of GDP ($18 trillion in the current economy) immediately after World War II.”
Stu,
Another major difference is that we owe majority of this debt in short term T-bills to our enemies overseas.
in 1948 we owed in in 10 and 30 year bonds to our own citizens.
Big difference in my books.
Sean 128
the only stake i currently have in the market is purely gambling and something i am willing to lose. otherwise i am not trying to play the market. I fully expect the government to change the rules of the game time and again and am not willing to play that game.
while agree with some of Mish’s points, i dont agree with all. I do think we will see lower prices in some segments but not across the board. I think a pull back from globalization due to tight credit will keep some prices high as it becomes harder to leverage off slave labor to produce consumable goods.
just my 2 cents, as a high school janitor
Kettle1 we will have to a have a beer one day, lets hope before a bud cost $10 a can.
make 142
we were also a rapidly expanding nation with access to substantial and cheap energy reserves.
“Banks Still in the Crapper”: Expect Loan Losses to Mount, Davidowitz Says
http://finance.yahoo.com/tech-ticker/article/312703/%22Banks-Still-in-the-Crapper%22-Expect-Loan-Losses-to-Mount-Davidowitz-Says?tickers=XLF,C,VNO,SPG,IYR,RWR,FAS&sec=topStories&pos=8&asset=&ccode=
Ground Zeroes
A group of experts have weighed in on the root causes of the meltdown that led to the national economic crisis now spreading throughout the globe. And although some point to different regulations on all different levels of government, these experts agree that regulation — that is, over-regulation — was the root cause.
Coy sums it up: “Places where new home construction is a long and expensive process … tend to experience big price movements, both up and down.” Florida has become infamous for its voluminous growth management laws — legislation that the secretary for the Department of Community Affairs describes as “huge” and “bloated.”
Add to the growth management laws unwieldy state, regional and local permitting processes, plus some of the highest impact fees in the nation, and Florida and Gulf Coast communities fit the bill for boom and bust based on overregulation. With the lot and home price volatility of Sarasota and Lee counties, evidence abounds that over-regulation played a big part in the economic demise of the region and beyond.
“Another major difference is that we owe majority of this debt in short term T-bills to our enemies overseas.
in 1948 we owed in in 10 and 30 year bonds to our own citizens.”
So true and a point eloquently covered in IOUSA.
We could create crisis bonds (like our war bonds) but who has the money to buy them? Much smarter to give money to Wall Street then to expect them to give you money. I truly think we are turning into Argentinians with slanty eyes.
sean (128)-
Higher prices for a variety of goods and services are not incompatible with deflation.
Goldman Subpoenaed on Huddles
http://finance.yahoo.com/banking-budgeting/article/107614/goldman-subpoenaed-on-huddles.html?sec=topStories&pos=2&asset=&ccode=
“Mr. Galvin on Wednesday said he is concerned that now the trading arms on Wall Street are putting undue influence on research analysts to win business. “Even the term ‘huddles’ sounds suspicious,” he said. He said his investigation may expand to look at practices at other firms.”
Stu (137)-
We’ll blow right through that number. This will all end in default, repudiation and, possibly, a giant war.
Sean
Kettle1 we will have to a have a beer one day, lets hope before a bud cost $10 a can.
No worries. we will both be making 500K/yr at that point.
Perhaps as our savings rate grows these monies will be invested in US treasuries….in fact as yield inflation occurs, this seems to be a possibility.
make (142)-
As my daughter does, I prefer not to call them enemies. Why don’t we call them “frienemies”?
[sarcasm switch broken again]
“Another major difference is that we owe majority of this debt in short term T-bills to our enemies overseas.”
1987
to date a large portion of the increase in “savings” as measure by various government reports is actual write downs and defaults on debt. you cant by treasuries with that.
Winston Churchill: “We contend that for a nation to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
vodka (155)-
That’s why if you’re a banker, you have to dump all your crummy debt instruments on the Fed in exchange for nice, crisp new Treasuries.
for the FX nuts here:
US Dollar Remains Correlated to S&P 500, Ignores Interest Rates
The US Dollar has increasingly moved away from interest rate developments, and indeed its correlation to US Treasury Yields trades near the neutral zero mark. A correlation of zero implies that there is no evident numerical link between two series, and recent price action backs up that assertion. The USD has proven far more sensitive to developments in equity markets. Though Treasury Yields and the S&P are historically correlated, recent price action suggests that said markets are increasingly disconnected.”
http://www.dailyfx.com/story/dailyfx_reports/cross_markets_data_reaction/US_Dollar_Remains_Correlated_to_1250690860167.html
I saw the post on Dwek, I think we should start a pool on where they’ll find his body and who ultimately is responsible for killing him. A lot of people want his head on a pike. Somehow I don’t think dishonest people giving bribes, cheating on taxes, selling black market organs, excepting bribes, etc would have a moral issue offing this guy.
Another major difference is that we owe majority of this debt in short term T-bills to our enemies overseas.
A very good reason for a declared war. It’s settled law that the property of enemy aliens is forfeit. Poof goes the national debt.
Punch,
war with china is no small matter. thats a serious game of chicken.
re: #159 – Dwek’s house in Deal is up for Sherrif’s sale next month. I would be surprised if he wasn’t in the Witness Protection program already. Perhaps one day you will see him working at a Home Depot out in Montana.
who wants to buy over 100 year old scottish widows?
http://www.bloomberg.com/apps/news?pid=20601102&sid=ar9f8_NMUOk0
big movers: aig,,c, fne,,fnm,,cit
now market favorites
how the world has changed
“big movers: aig,,c, fne,,fnm,,cit”
It’s sort of John’s theory that everyone has jumped on board. Buy whatever the US government is backstopping. If you think about it, it makes perfect sense as this charade continues. Certainly Uncle Sam would never let a company that it owns fails. Much easier to let private sector companies fail. The press won’t make the gubmint look nearly as bad this way. Uneffin-believable. China, why are you still buying our trash? Have you been duped as well?
Comrade Nom #138
Reminds me of the South Park episode
“Death Camp of Tolerance” when the teacher Mr Garrison figures out that he can win a million dollar lawsuit if he can trick his school into firing him for gayness.
http://www.southparkstudios.com/episodes/103981
the trend is you friend. sad,, aig,c etc.
volumes unbelievable ,have turned into
day trader specials,,, and of course the
frequency boys are in on it as well.
where’s the SEC ?
Here’s my question.
If you think the dollar is going in the toilet, why wouldn’t you want to eagerly go short the dollar by borrowing as much as you can via a fixed rate mortgage with rates held low by Treasury and Fed manipulation? In 15 years, a $4,000/month mortgage payment may seem like peanuts, post devaluation and inflation.
Of course, by then, local property tax may have grown to $8000/month, because they will certainly inflation adjust.
“where’s the SEC ?”
In the stands cheering.
My fave South Park episode is when Mr. Garrison has a sex change and ends up being lesbian. When he first comes ‘out’ to his class, it’s pretty hilarious.
Mrs. Garrison: Kids, I need to tell you something that you might find shocking. I’m gay.
Stan: Again?
“big movers: aig,,c, fne,,fnm,,cit”
The Five Horseman of the Apocalypse.
Grim (169) is in mod. Who would have thought South Park quotes would trigger moderation.
A.West,(168)
There are better ways to plau it. Shiny anyone?
[142] make
Huge difference. Huge.
Could it be that AIG had some good derivative bets and they’re paying of in this rally. TARP cleaned out the junk and this artificial rally is pumping them with cash?
Is AIG business model flawed? Are all their companies loosers?
is this just a good old pump and dump?
Another major difference is that we owe majority of this debt in short term T-bills to our enemies overseas.
in 1948 we owed in in 10 and 30 year bonds to our own citizens
We still do.Treasuries that are not bought in the open market,the feds buy this treasuries(monetization).We never put a gun to china to buy our debt.Foreign countries are so heavily invested in the US,they have no choice but keep on buying our debt.We have the upper hand.
Foreign capital is not needed to finance the budget deficit. In a context where the economy is below full employment, as is projected to be the case for the next five years, the Federal Reserve Board can finance the budget deficit by directly buying debt, as it has been doing. It would have been helpful if the article pointed out this fact, since there have been huge efforts by Obama administration critics to spread misinformation on this topic
Just boarded my V*rgin America flight to San Francisco. There’s mood lighting…and shaken c*cktails after takeoff. Have a great weekend, y’all.
Clot,
Well, I am being roped into my daughter’s Brigadoon D1 soccer team. Wife is coaching and knows nothing about soccer. I will have no portfolio or title, but I will be teaching the young’uns about shoving and hacking and pushing off in regular and informal practices. No yellow cards at this level so that should be good for toughening them up.
After all, can’t have you complaining anymore about whining, diving Westfielders. I expect that, after my special training, Daughter 1 will be able to run over the opposition and do it with a smile.
that’s the exact reason for him to be awarded nobel economics and peace prizes this year. he discovered a magic formula to solve world ecomonic problems. this formula is 1 million times more useful than black scholes.
> the Federal Reserve Board can finance the budget deficit by directly buying debt, as it has been doing.
Green Shooottz!
http://realestateconsumernews.com/wp-content/uploads/2009/08/Negative-Equity-by-State-June-2009.jpg
#179 The nation still has LTV of 78% that is not bad considering 22% is an equity.
New jersey has LTV of 70%.NJ has 30% in equity.
http://www.nypost.com/seven/08272009/news/regionalnews/tax_chief_charlie_a_tax_cheat__too_186678.htm
These guys need to be de-capitated and then hung on times square.
kettle = stu sans wisdom, credibility, or any sense of proportion about the financial markets…..
bi – are you part of the Feds new Austerity program? Are they now trying to put a simley face on their public image? Are they perhaps celebrating a little too soon? Perhaps they should hold off on the Noble nominations and champage until we get through the end of the year.
Yes, the Fed and Bernanke “rescued” us from a deflation spiral bu tthe process is turning the U.S.A into a third world country. Look around you, food stamp participation is up to an all time high of 11% of the population.
I for one am waiting for the “liquidity withdraw” to occur before I stand up and applaud the man for his efforts. And by the way that “liquidity withdraw” needs to occur without crashing the markets or all of the Feds double entry bookkeeping was all for nothing.
I love you too chifi
try a barium colonic sometime. It might wash that bug out of your a$$
Budget Deficits and the Theater of the Absurd at the Washington Post
The White House’s 10-year economic projections show that the economy will be in considerably worse shape than the previous set. As a result, the cumulative deficit over this period will be $2 trillion larger. One might think that the prospect of millions more workers being unemployed would be news in the Washington Post. Nope, they just just talked about the budget deficit.
The article also related the budget deficit to U.S. indebtedness to China and other Asian countries. The level of U.S. indebtedness to other countries is determined by the trade deficit, not the budget deficit. The trade deficit is primarily the result of an over-valued dollar. Neither the trade deficit, nor the value of the dollar, was mentioned in the article.
— Dean Baker
Our foreign borrowing in 2009 is not $1.8 trillion, much of lending did come from domestic sources, including the Fed. But the more fundamental point is that the key determinant of foreign borrowing is the trade deficit, not the budget deficit. Hence, we were borrowing an amount from foreigners that was close to 4.0 percent of GDP in 2000 ($600 billion in today’s economy) when the government had a huge budget surplus. Anyone concerned about borrowing from foreigners should be talking about the trade deficit, not the budget deficit, which gets us back to the ominous warning from the editorial that: “it’s alarmist to underestimate foreigners’ willingness to keep holding dollars; it’s foolish to count on it forever.”
Okay, class what happens when China, Japan, and other foreign central banks stop buying U.S. dollars? That’s right, those of you who have heard about supply and demand (advanced economic concepts) know that the dollar will fall in value. This is exactly what both the Bush and Obama administration supposedly want, at least in reference to China’s currency. We have made official complaints that China has been “manipulating” its currency, which means raising the value of the dollar against its currency by buying up huge amounts of dollars. So, the Post is warning us that China may do exactly what we have been asking them to do, and stop buying up dollars and letting the dollar fall relative to the yuan.
This would have the effect of making Chinese and other country’s imports more expensive for consumers in the United States. Therefore we would buy more domestically produced goods. There would be more jobs in U.S. manufacturing. The lower valued dollar would also make U.S. exports cheaper for people living in other countries. Therefore we would sell more exports. This would also increase the number of manufacturing jobs in the U.S..
Oh yes, there would be somewhat more inflation. We can get a rough estimate of the amount of additional inflation through applying another concept unknown at the Post: arithmetic. Imports account for about 16 percent of GDP. Suppose that the dollar falls by an average of 25 percent against the currencies of our trading partners. Presumably it will fall by much more against China’s currency and considerably less against the euro and the currencies of some other major trading partners.
If the decline in currency values is translated one to one into higher prices (almost certainly a gross over-estimate of the impact), this would result in an increase in the inflation rate of 4.0 percentage points. If the decline in the dollar and rise in import prices took place over 3 years, then it would imply a boost to inflation of 1.3 percentage points a year. This is a serious impact but hardly unmanageable. More importantly, it is also unavoidable for precisely the reason mentioned in the Post’s editorial: we cannot count on foreigners to buy up dollars forever.
In a policy move strongly endorsed by the Post’s irresponsible and short-sighted editorial board, the Clinton administration actively promoted a high dollar. This led to the large and unsustainable trade deficit the country has experienced over the last decade. The only way to get the deficit down is to bring the dollar down. The high dollar was a policy that brought some short-term benefits in the form of cheap imports and lower inflation, but comes with an inevitable long-term price
Okay, this is real estate related, and Dean Baker doesn’t figure in it at all.
From the Boston Globe:
“The number’s may be up, but Obama’s not with real estate brokers
Posted by Scott Van Voorhis August 26, 2009 09:00 AM
Am I not getting something here?
The real estate market is finally showing some solid signs of hope. Yes, foreclosures are still worrisome, but sales are rising, both on a month-to-month and year over year basis.
Prices, meanwhile, also seem headed in the right direction.
Check out the coverage of the July numbers released yesterday by the Warren Group and the Massachusetts Association of Realtors. Both groups are reporting a double-digit bounce in sales.
The numbers, nationally, are also up.
But among Realtors, President Obama’s numbers are down, real down.
The president’s approval rating slipped from 57 percent in the second quarter to 42 percent in the third quarter, according to the recent HomeGain survey of Realtors.
A whopping 40 percent “strongly disapprove” of his job performance so far.
Wow, just imagine what will happen if we start seeing runaway home prices again.
OK, so I am not arguing that Obama single-handedly turned around the real estate market.
The attempts to put a dent in the foreclosure crisis have failed so far, though not quite as miserably as those of his predecessor.
But he certainly wasn’t the one to drive the market into the ditch, either.
Anyway, I got a kick out of some of the broker comments posted by HomeGain.
Some certainly were supportive, or critical in a pointed way, such as concerns about sluggish job creation and the fact that banks still seem allergic to lending.
I guess I am just a liberal Massachusetts elitist, but I guess I just don’t get some of this stuff.
Here’s a sampling.
•“Barack Obama is ruining this country along with his co-horts in Congress.” – Alisha Wade, Realty ONE Group Inc., Las Vegas, Nevada
•“Obama does NOT support working for a living, earning a decent living, and being successful. The government does not support home ownership and regulate the mortgage business in the past. All of this together will increase TAXES for the successful.” – Dennis Johnson, Breckenridge, Colorado
•“Obama will buy the United States! The public will soon find that the potential excessive taxes (everywhere) will bury them in debt and create a re-visit to the 1930’s. THEY WANTED CHANGE, THEY GOT IT!!!” – Ken Fisher, Ken R. Fisher & Associates Inc., Fishers, Indiana
•“Obama is not out on the street daily like I am. He claims market is getting better. Not true!” – Joe Malecki, Realty Executives New Image, Tinley Park, Illinois”
I like Ken Fisher’s quote “They wanted change, they got it!”
Finally found a house and submitted offer today.
It was sold in 2006 for 300k and the owners put new kitchen, refinished basement, siding, driveway, hardwoods and windows.
Then they turned around and relisted at 440K in an attempt to flip but no buyers so they took it off market last winter. Recently relisted the place for 365K to get rid of it. We submitted a strong offer immediately today close to asking price.
Hope to land this one.
After we buy bottom will fall out from market the following week.
Chi,
Just kiss Ket already and get it over with.
Veto: I hope you get the house.300G is not bad around the princeton area with all upgrades you just mentioned.
I mean mid 300G
This augurs well for agricultural land prices and the future for a Nompound.
“The U.S. Agriculture Department said Thursday it expects net farm income, a widely followed measure of farmer profitability, to fall 38% this year to $54 billion.
The bursting of the farm commodity price bubble late last year means that U.S. farmers will see their collective earnings sink by $33.2 billion from last year’s estimated net farm income of $87.2 billion, which was nearly a record high.
The appearance of the global recession last year has softened foreign demand for U.S. agricultural goods. At the same time, the outlook for bumper harvests this fall is weighing on commodity prices. . . .
Adding to the pain for farmers is that the size of the federal aid they will receive this year will be a relatively low $12.6 billion, according to the USDA forecast. Although commodity prices have sunk sharply from last year’s high levels, prices of many farm goods are still above the levels that earlier this decade triggered far bigger direct government payments to farmers.
In 2005, for example, government payments to farmers reached $24.4 billion.”
Thanks yome, i agree.
we cant even find a town home for mid 300s around here.
From CalculatedRisk; Car sales forecast to slump %11 below June levels in Sept.
107 Ruggles
I’m well aware. But that’s ok. In that case, I’m happy to be looked down upon.
113 Clot
Then ignore the email I just sent you. I don’t have an explosive recipe.
135 Skeptic
Those teachers are sitting in those rooms for years at a time because of the City’s inability to conduct an investigation in a timely fashion.
138 Nom
Exactly. While these people are being investigated they cannot be in direct contact with students. It would make sense to have them doing maybe some clerical work, grading tests, anything related to their profession rather then just sitting there. If they don’t bring their own “work” to do, they really have nothing to do.
Veto
Good luck on getting the house.
Tosh:
“Car sales forecast to slump %11 below June levels in Sept.”
That’s what I said yesterday when the Durable Goods report was released. The only reason the economy is revealing green shoots is because the government is printing money and then fertilizing the soil with it. If anyone here knows anything about fertilizer, once you stop applying it, the shoots end up in worse shape then if you had never fertilized them at all. At some point, Bernanke’s gonna have to stop growing our GDP through government spending. That is a trick I’m waiting for the student of the great depression to execute. I am fairly certain that it was WWII that saved our economy and letting the bad bank fail that eventually saved our financial system by strengthening the stronger ones.
ap:
Investors trading 3 stocks that may be doomed
Investors still trading Fannie, Freddie, AIG shares, even though prices are likely to hit zero
http://finance.yahoo.com/news/Investors-trading-3-stocks-apf-3151182490.html?x=0&sec=topStories&pos=3&asset=&ccode=
Can someone with access to the GSMLS tell me if listing # 2703549 is currently (and / or if it was ever previously) marked as being in attorney review status ? Much appreciated……..
#198 – Exactly. While these people are being investigated they cannot be in direct contact with students.
I believe there was an episode of This American Life on this very subject.
In fact you can find the episode for free right here.
thanks for all your advice. We lost that house. I am sure that I would have more headaches during attorney review. I wonder how they removed the undergrown oil tank–house has well water and septic, so I am concerned.
#118:
Nom, a rich lawyer like you should forgo bottling of the homebrew but should keg it instead.
Got to tap the honey peach wheat tonite–9.0% ABV.
yo (175)-
The US has become its own biggest debtor.
plume (177)-
Your goal here should be to transform Daughter 1 into Thing 1.
“After all, can’t have you complaining anymore about whining, diving Westfielders. I expect that, after my special training, Daughter 1 will be able to run over the opposition and do it with a smile.”
make (181)-
They should bring back bear-baiting and make Rangel the bait in the first tournament.
NJGator
Have a great flight! Virgin rocks!
Feh. Wake me up when Branson will shoot me into outer space and serve me a fruity drink up there.
BTW, I also want to take my dog with me into a sub-orbital parabola.
New Construction reduced $425,1000 in Skillman NJ
http://www.trulia.com/property/1066690869-40-Grandview-Rd-Skillman-NJ-08558
Renter,
Did you mean $749,900 ?
http://www.breitbart.com/article.php?id=CNG.4452bed82adf3124e5884678e236d7fb.361&show_article=1
A job seeker looks over the employment bulletin board the New York State La…
Flashback — ‘Everyone Guessed Wrong’: Biden Explains Why Unemployment Soared After Stimulus
Dobbs Questions: Where Are the Jobs?
‘Bloodhounds’: GOP Brings in Ellie Mae to Help Find Stimulus Jobs
‘Dirty Jobs’ Host Mike Rowe Describes Effort to Elevate Views of Manual Labor
The real US unemployment rate is 16 percent if persons who have dropped out of the labor pool and those working less than they would like are counted, a Federal Reserve official said Wednesday.
“If one considers the people who would like a job but have stopped looking — so-called discouraged workers — and those who are working fewer hours than they want, the unemployment rate would move from the official 9.4 percent to 16 percent, said Atlanta Fed chief Dennis Lockhart.
He underscored that he was expressing his own views, which did “do not necessarily reflect those of my colleagues on the Federal Open Market Committee,” the policy-setting body of the central bank.
Lockhart pointed out in a speech to a chamber of commerce in Chattanooga, Tennessee that those two categories of people are not taken into account in the Labor Department’s monthly report on the unemployment rate. The official July jobless rate was 9.4 percent.
Lockhart, who heads the Atlanta, Georgia, division of the Fed, is the first central bank official to acknowledge the depth of unemployment amid the worst US recession since the Great Depression.
“try a barium colonic sometime. It might wash that bug out of your a$$”
nah.. just do what i do.
warm milk & cognac.
works like a charm.
SAS
Tried find something for a colonic, but all I managed was some polyp removal…enjoy
http://www.youtube.com/watch?v=HVhmcPPTllg&feature=related
ug oh, not good.
“Vote could open 250 L.A. schools to outside operators”
http://www.latimes.com/news/local/la-me-lausd-schools26-2009aug26,0,4203620.story
SAS
Here we go…
http://www.youtube.com/watch?v=-g5lqrr2Xgw
Don’t ask….
http://www.youtube.com/watch?v=8fqncj3G6tg
My take on Virgin America – more comfortable than Continental, but not as nice as Virgin Atlantic. Guess I need to go back to London soon.
It’s a beautiful evening here in the Bay Area. Can’t wait to drive up to Wine Country tomorrow.
I listened to Michael Steele this morning on NPR discussing Healthcare. It was a bit sickening, unless you can come up with something better, STFU.
His whole premise was that “gvmt can’t compete with the private sector, it is too wasteful and inneffiecent. Look at USPS it is so mismanaged”. Does he fail to realise that without USPS, sending a letter to anyone would be far more than 42c.
This reminds me of the NY bridges and tunnels. Although they are all revenue generateing entities, every New Yorker has to have a toll free path between their house and City Hall. The funny thing is that they get a free pass to City Hall, but have to pay to get home.
#177 Nom
If you are going to coach, please learn the correct interpretation of the offside rule.
“If you are level when the ball is kicked, you are off”
Does he fail to realise that without USPS, sending a letter to anyone would be far more than 42c.
It could cost 42 dollars for all I care. Not counting Christmas cards, I probably send two or three stamped items a year, if that. And if Christmas cards were 42 dollars a pop, I wouldn’t send them either.
I’ve recently gotten into the habit of leafing through my daily pile of junk mail and then walking it right to the recycle bin. Keeps the clutter down. I swear I haven’t brought a piece of US mail into my house in months.
The post office is going to lose 6.5 billion this year. That stamp costs a heck of a lot more than 42 cents.
Good luck if you have any open case with cisco! :(
Hi Alex,
Thank you for your time and patience; as per as our telephonic conversation ,I will go ahead and close this service request, but, if at any point you need further assistance on this or other matters, please do not hesitate in contacting me.
In summary,
We were getting throttles on the fast ethernet interface. I explained you the reason why we get throttles.
You informed me that we get this issue of throttles once in four to six weeks.I suggested you to increase the size of hold queue.
I also suggested you to move to the latest IOS in order to narrow down the issue.
We decided to temporary close the case as the issue only happen once in four to six weeks.
I am sending you the following documents that should be useful in future :
And yes, it was a call from India
bloomberg.com front page news is almost all positive this morning. This is a an effective way to manufacture a recovery. Act as if all is well and then hope that reality will follow suit..
Thanks for the information