Bits Bucket for September 14, 2012
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Continuing yesterday’s conversation, can someone please explain to me why the Fed apparently thinks that house prices will rise as interest rates continue to drop?
Mortgage interest rates have lowered steadily over the last five years, as have house prices. The Bernank now tells us that interest rates will stay this low until at least 2015, (when presumably legions of enraged retirees and savers take to his successor with pitchforks). Given the oversupply of housing and general lack of demand, why would lowering interest rates even further make the slightest bit of difference? Thanks.
Because Ben says it is so and he’s the Messiah.
http://www.youtube.com/watch?v=OOuWWzP7wl0
Given the oversupply of housing and general lack of demand, why would lowering interest rates even further make the slightest bit of difference?
Not to mention the things underlying the lack of demand: Sluggish job growth and declining American incomes. Neither thing leads to increased household formation, and, thus, an increase in demand for housing.
Mind you, I’m not a highly paid Federal Reserve economist. I’m just Arizona Slim paying attention to the news and the trends behind the news.
You’re presuming that that is their intention. I’m more inclined to believe that they are simply trying to hold off another downturn in order to keep people spending money they don’t have. Their goal isn’t to create a recovery, just prolong a disaster until they’ve left and can’t be blamed anymore.
Some may also being hoping for a Hail Mary in the form of another economic boom totally unrelated to real estate, but yet one that lifts all boats. I put the odds of that happening at about the same as the odds of the Browns winning the Super Bowl.
Oil prices are shooting through the roof. J6P, who has cashed out or at least not added to his IRA and/or 401K so will not gain by the stock market increase now has to go to the pump and between the last two days pay another 10 cents a gallon. I don’t see how this helps Obama’s re-electon chances despite what MSNBC might “think”. Of course, maybe that is because no one on MSNBC can think.
Personally, I’m looking for a great many more Oil For Food scenarios as populations and countries become increasingly desperate.
J6P won’t know who’s causing it…the 1% are all repubs, right?
Oil prices are shooting through the roof. J6P, who has cashed out or at least not added to his IRA and/or 401K so will not gain by the stock market increase now has to go to the pump and between the last two days pay another 10 cents a gallon.
Sort of makes those who purchased hybrids and electric cars look smart. No better hedge against inflation then decreasing your need for gas by 30-100%. My Tesla should arrive next year. My civic hybrid will have over 180k by that time and averaging 50mpg.
I didn’t know that the typical J6P could afford a new $30-$50K hybrid.
Silly me. I must be unaware of all those programs designed to allow $12/hr. wage earners to blow tens of thousands on a new gas sipper.
Depends on how much you drive per year but hybrids do make sense for some people. However, cars like the volt would need ten dollar a gallon gas to make sense due to the high cost to purchase and limited range. I think if you look at the sales, you will see I was right when I said they would not take off, if the immediate future. NGVs will be mass produced long before them under the Romney administration it increasing looks like. Obama started the week a head by 5% before you allocated the undecided and now:
The Rasmussen Reports daily Presidential Tracking Poll for Friday shows Mitt Romney attracting support from 48% of voters nationwide, while President Obama earns 45% of the vote. Two percent (2%) prefer some other candidate, and five percent (5%) are undecided. See daily tracking history.
Albuquerquedan, all these ‘alternatives’ express the true costs of high-speed, high-mass transportation in a post-petroleum world.
That automatically means much of our cheap-oil economy must collapse.
No more spending trillions at the federal level. There just won’t be enough production to tax, even at a 100% rate, in order to support that. The US economy will eventually decline to 10% of today’s GDP. Naturally, the government will try to continue to spend like in the peak of the Petroleum Age (2007), and that will cause a social revolution. Since people and remaining companies cannot pay 100% of their incomes, there must be some sort of revolt, a Tax Revolt. And it will be bloody.
Much as I love my 2004 RX330, its gas-guzzling ways have me considering joining the Prius crowd. I already sip lattes and am socially liberal, so I guess I fit the demographic.
Problem is, you can buy a lot of gas for the price of a hybrid.
What Tesla are you getting?
Yep.
Let’s say gasoline goes to $10/gallon. Let’s say you burn 10 gallons a week. That’s $150 a week to fill your tank. $600/month. $7200 annually.
Let’s say you bought your used guzzler for $10K.
Let’s say your new hybrid costs $40K.
Differential of $30K.
7200 into 30000 k is a bit more than 4 years. 4.2 or whatever.
And that’s at 10 dollars a gallon. At $5 a gallon, it’s 8.4 years.
Not included is the difference in insurance costs, the cost of electricity, or inevitable repairs. I haven’t included those because I have no idea what they are. The cost of relative safety also should be taken into account.
Also not included is the opportunity cost of that $30K in spent money. Nor is the cost of depreciation included. Tax write-offs.
What am I missing?
I guess there’s some value that can be placed on appearing or considering oneself “smart” as compared to Jonesers or Republicans.
But there’s also potential loss in appearing to be a 1%er, which you are if you can afford several hybrids.
I didn’t know that the typical J6P could afford a new $30-$50K hybrid.
Ford CMAX hybrid 25k used hybrid less taking the bus riding a bike cheap as can be.
“However, cars like the volt would need ten dollar a gallon gas to make sense due to the high cost to purchase and limited range”
1 Currently you can get a VOLT for 31k after the incentive. I think the brake even is far less than 10 bucks a gallon.
2. All the arguements used against the VOLT were used against the prius when it came out in 2000 only it’s amplified due to politics. I blieve Totoyota sold 136,000 last year which is more than the ford focus and they are profitable.
3. If you are worried about hyperinflation or war in the middle east you are dumb not to consider a VOLT or other plug in hybrid (ford CMAX energi looks good too). It’s insurance against inflation and shortages.
Plug in hybrids are great for what ails this country. They require more labor to make so decrease unemployment and they keep us from sending money to Saudi Arabia, Iran, Lybia etc. I can’t see why so many people on the right hate these cars.
Model S
Middle Coaster - You should consider Tesla Model X coming out next year.
Do NOT buy a Prius.
Mine gets 32mpg and Toyota has assured me that “mileage is not guaranteed.”
It stopped getting 42 mpg when the battery died (regular battery, not hybrid) when it was unregistered and undriven for a month, but Toyota claims there’s nothing wrong with it.
We also had a minor hail storm shortly after I moved to KS and my Explorer had no damage, every other car on the street had no damage, but the Prius has dings all over it.
It is poorly made, the company does not stand behind it, and I regret my purchase every day.
I did a 10-year analysis and this should have been cheaper over the period than the car I really wanted which got about 30 mpg. But instead I threw away about $10,000 on crap.
6.5 more years until I buy another (used) Ford. Will never buy Toyota again.
I would expect people to go scooter/motorcycle before hybrid.
I’m still waiting for my dad to sell me his 7 year old Civic to replace my 15 year old Taurus.
Model S
We’re starting to see the first ones on the road here. There’s a dealership in Boulder. Beautiful car.
“I would expect people to go scooter/motorcycle before hybrid”
Put in motorcycle lanes and I’ll consider it. Until then, with the SUV drivers too busy texting and screaming at kids to pay attention to a mere bike on the road, no thanks!
1. You are not driving your prius right if you are getting 32 or you have a bad traction battery or eninge problem. My wife has 100k on her prius if you drive it right you can still get 45-50mpg around town. In the Winter 30-35. Her toyota corolla got 22 in town. If you gun it off the line drive 90mpg and jam on the brakes or drive straight up a mountain don’t get a hybrid it won’t help you look at a diesel. If you accellerate slowly, and do a lot of stop and go or slow and go, and use regenerative braking and with the prius pulse driving the hybrid is a great choice. I used to get 60mpg in 3 hours of chicago traffic with my 2001.
CMAX hybrid is Ford and looks like a great around town car for 25k.
you said
It stopped getting 42 mpg when the battery died (regular battery, not hybrid) when it was unregistered and undriven for a month. Why was it unregistered and undriven for a month? Did you buy it used?
The regular batteries health should have zero effect on your gas mileage. When the traction/hybrid battery goes your mpg will suffer)
Problem is, you can buy a lot of gas for the price of a hybrid.
The beauty of a paid for car.
Will never buy Toyota again.
I too was unimpressed with the Toyota I once owned. The way they act at the dealership, you’d think that they’re made of gold or something.
Back in our minivan days we stopped by the Honda dealer to look at the Odyssey. I asked the sales droid if Honda had resolved the problem with the tranny (note: years later, Honda still hasn’t fixed that dog). Anyway, the guy acted all offended. Needless to say, we left empty handed.
I miss my motorcycle. Sold it last because with kids and dogs it was sitting more than it was being ridden.
But you can’t beat a motorcycle when it comes to gas mileage, unless you are riding a bicycle.
The way they act at the dealership, you’d think that they’re made of gold or something.
I have had the same experience in auto dealerships in general. Are they following the Madoff school of auto sales strategy? Pretend disinterested and the buyers will want even more? Didn’t work on me.
Good information, measton - thanks.
While it’d be great if electric car economics worked for more people, I think that is a few decades away, if then.
I’d love to go with a natural gas car, but alas, there’s the same problem there. Plus no infrastructure to make it practical for J6P. This is a shame, as natural gas is plentiful in the USA.
If the our oil reserves in the Dakotas, Colorado/Wyoming/Utah and Ohio/Pennsylvania could be tapped more effectively and quickly, we could buy/tax our way into a viable, consumer level natural gas industry.
Sad that politics won’t let that happen, either.
Sad that short-term vision of the American population as a whole won’t let it happen, either. No one will tolerate pain now if others can be made to tolerate significantly greater pain later. ME Generation indeed.
I’d love to go with a natural gas car,
All the taxis in Rio are Nat Gas. The air is cleaner but there is no taxi trunk space now.
Then they’d be admonished by NYC cabbies. They like to steal your luggage there.
On two different occasions, on different trips, the trunk of the NYC cab I was riding in “just happened” to pop open at a stoplight, halfway through the ride. By accident, of course.
“Also not included is the opportunity cost of that $30K in spent money. Nor is the cost of depreciation included. Tax write-offs. What am I missing?”
Not sure how this has panned out with the Prius, but with a pure electric vehicle, no oil is used. The Volt can be used this way, if your commute is 40 miles or less round trip per day like most people, you won’t need to run the gas engine. Not a huge deal, but those oil and filter changes do add up over time.
Figuring out the cost of running a GM Volt car isn’t that difficult. From published reports, the battery pack hold 16 KWh of electrical energy, but won’t allow you to totally drain the pack during use. So a recharge only pumps in about 10.5 KWh. You can go 35-38 miles per charge, depending on which published claim you believe. That’s average; poor driving drops that down to maybe 25mi, but very conscientious driving can raise that to 70mi. Call it 38mi. Everyone is told their cost per KWh on their electric bills. In my area, it’s 9c. The national avg is 12c. Around CA it’s 16-25c. But using the averages, we end up with 12 c/KWh x 10.5 KWh = $1.26 per 38 miles, or the equivalent of 114 mpg at today’s gasoline price of $3.80.
Sounds great, right? Not really, since the purchase price of the Volt is so high. MSRP $39000. And it can be compared to the 48-53 mpg Toyota Prius model that has an MSRP of $25000. The kicker is that both models of car qualify for the same tax breaks; both are “hybrids”. So even saving $2.60 per gallon (equivalent) in gasoline takes a long, long time to cover the huge purchase-price difference. Most people don’t go over 38 miles in a day of driving, so that $2.60 into $14000 results in 5380 driving days. That takes 17 years (6 days driving per week; 312 days per driving year) at current prices to recover.
You might say, “increasing gas prices makes that a better deal over time”, which is true, but then you have to realize the Volt needs its battery pack to be drivable, and that craps out in 10 years or so… well within the payoff time. Even 10 years from now, from published estimates, that pack will cost $5000 to replace. And you MUST replace it, since the car won’t run without it. That expense creates an additional 1920 driving days (6 years) of required payoff time.
My theory from all these numbers is that the GM Volt will NEVER pay off for you. So just buy a Toyota Prius, or some other low-cost, moderate-mpg car. And run your own numbers. If you have trouble with those, ask us here on the HBB.
simply trying to hold off another downturn
+1. But as usual, what was originally intended to be a temporary windfall will eventually become a new normal that we depend on just to stay afloat.
Oxide,
This heralds in a future weekend topic (perhaps for next weekend):
What will your new, personal normal be in response to ongoing QE policy that the country now depends upon just to stay afloat?
I want to know what individuals here plan to do in response. None of us might be able to avoid the oncoming tidal wave, but perhaps there are underwater caves in which to take refuge.
I want to know what individuals here plan to do in response.
1. Purchased a small house on a large plot. Paid cash.
2. By next year will have 2 electric cars and won’t need gas.
3. Looking at installing solar panels and won’t need electricity.
4. Planting big gardens and looking into fruit trees.
5. Storing cash with some investment in energy heavy nat gas and recently solar.
6. Clothing supply that will last 10+years.
7. Putting in rain barrels
8. Riding my bike
9. Exercising my 2nd amendment rights.
#2 and #3 make NO economic sense. Plenty of other alternatives that do…
Exercising my 2nd amendment rights.
+ 1000
But you forgot to add some precious in there for diversity’s sake…
Vote Republican so we call all act like the animals that we are.
Vote Republican so we call all act like the animals that we are.
When it all goes to hell in a hand basket, [see the entire MENA currently], you’ll be wishing you had one of those “evil black rifles” and some steel-core 5.56 to keep evil-doers at bay.
Keep thinking the US is too “civilized” to suffer the riots and chaos currently enveloping the world. Keep thinking the lawlessness of Katrina was an isolated incident…
Northeasterner,
What makes you think I am not a gun owner and card carrying member of the NRA?
Maybe you missed the stuff about me being a lifelong Republican, before pulling my head out and seeing the massive debt being used to paper over out massive trade imbalances.
Maybe you somehow missed the stuff about my dad’s hunting cabin in the woods.
Maybe you missed all my comments about how gun crime rate dropped in CO after they started issuing concealed weapons permits.
I’m sure you noticed my repeated mentions of being a vet.
Of course, my guns are for hunting non-human animals.
I think people that are prepared for the total break down of all law and order and being forced into “The Postman” style militias…. good luck with that.
” Keep thinking the lawlessness of Katrina was an isolated incident…”
You mean the media hyped, concoction of pure fiction that was largely isolated to people looting stores, not each other or the never happened, random gunfire in every street?
Keep thinking the lawlessness of Katrina was an isolated incident…
The lawlessness of the event was dominated by government intervention. In the well-armed South, lots of people could have defended themselves if the government had kept out of the matter. And by the “matter”, I mean by NOT trying to confiscate guns from the populace, and by NOT getting into firefights with armed citizens (and then lying about it).
the lawlessness of Katrina
Which prompted the squad’s first firearm purchase and acquisition of concealed carry permit.
The “just in time” delivery system of America’s food supply and retail only needs about a week’s time to collapse.
Then out come the zombie hordes
None of us might be able to avoid the oncoming tidal wave, but perhaps there are underwater caves in which to take refuge.
You guys are going a bit bonkers. Like you all know “it’s the end of the world”? And you’re all going to be there? Heck, you might be so preoccupied with your protection plan that you don’t see the bus that hits you.
Try to stop freaking out and go enjoy some life. I am tonight. (I hope)
“Try to stop freaking out and go enjoy some life. I am tonight. (I hope)”
Exactly.
“Try to stop freaking out and go enjoy some life. I am tonight. (I hope)”
Exactly.
Thanks for the reminder. Kind of a downer Friday morning here. I could use some fun times this weekend.
You guys are going a bit bonkers. Like you all know “it’s the end of the world”
Not the end of the world, but certainly a change. Wide spread poverty is coming to the US and there will be less for local law enforcement and prisons. 15 years ago when I moved to town there were hardly any murders or assaults or home invasions. They are common now.
“Try to stop freaking out and go enjoy some life.”
That’s what the riding my bike comment was for. I enjoy the gardening and riding my bike. I enjoy my electric car conversion. I’m not stocking up for the end of the world I’m stocking up to hedge financial risk and make sure my family is taken care of.
I enjoy the gardening and riding my bike.
I too enjoy riding my bike, (probably the only Ritchey in Rio) I miss my gardening a lot, and not owning a car saves bank.
stocking up to hedge financial risk
It’s expensive now but I’d own some gold too. Maybe silver is better now but who knows.
“Every society is three meals away from revolution.”
“Every society is three meals away from revolution.”
Tell that to the Koch brothers when they badmouth food stamps.
“I could use some fun times this weekend.”
Come to visit DC!
half price ticket to The Government Inspector by Gogol
African Skies exhibit at African Art Museum with free planetarium show (I expect to be introduced to a new set of constellations)
Meat eating plants at Botanic Gardens
Too much to list at Freer/Sackler
Women in aviation and space at Air & Space (though mostly aimed at kids)
Hispanic celebration at American History
Special program on rescuing the Chilean miners at Natural History
Movie about Alaskan artists at NMAI
Video game art exhibit at American Art Museum
free tickets to Best Little Wh-rehouse in Texas
There is more, but it would take too long to list it. Everything except the half-price ticket is free.
Come to visit DC!
I would love to. Let’s see how I’m doing next spring and let’s revisit this idea.
“Try to stop freaking out and go enjoy some life.
It helps to understand that folks have been preparing for TEOTWAWKI forever. Reading this gives a little perspective:
http://en.wikipedia.org/wiki/Survivalism
15 years ago when I moved to town there were hardly any murders or assaults or home invasions. They are common now.
Hmmm… coincidence? Remind me not to invite measton to the next HBB meetup.
“I want to know what individuals here plan to do in response.”
If you’re talking about the cost of necessities going up, we’ve almost run out of things to cut. Wife and I started this personal austerity thing five years ago not to survive, but as part of a plan to save for a large down payment on a house and to be able to afford the 19-month old baby we now have. We have kept most of the lifestyle changes below:
1. Cut off the cable TV (reaped benefits other than economic). $100/month savings
2. Dropped our land line phone, $45/month savings
3. Drove 60mph in the 70mph zone instead of 80 to save gas. Savings not much and I gave up on that one.
4. No A/C in summer, no heater in winter, period. (We live near Sacramento). House gets up to 90 max during a major heat wave, down to 52 in a major cold snap. Solutions: wet yer head in the summer heat, and wear some damn winter clothes in the winter! $50/month savings on average, much higher during heat/cold waves.
5. Costco. If you and your family can all eat the same stuff, it’s well worth the investment. At least $50 savings per month.
6. Only eat out once a month, if that, as opposed to once a week. Savings ~$90/month. Probably better for our health too.
That’s over $300 right there. Hope I don’t end up having to bike my 12 miles to work, I’m almost 50. I’m sure AZSlim could do it, but I think she’s an outlier.
So can the next president blame obama for the next 4 years for the mess he handed him?
Can obama blame obama?
simply trying to hold off another downturn
So can the next president blame obama for the next 4 years for the mess he handed him?
The President can blame a hollowed out American economy on 32 years of Republican and Republican-lite type economic policies. He can blame rapidly increasing wealth and income inequality and he can blame the current destructive form of American crony-capitalism that puts making money for a few over nationalism and a Constitutional mission to “Promote the GENERAL welfare”.
Oh, they’re promoting “welfare” alright. And then they complain about it.
I put the odds of that happening at about the same as the odds of the Browns winning the Super Bowl.
What do you mean? This is the year! Ask anybody from Cleveland…
They cannot drive up real prices but they certainly can drive up nominal prices. We are following the policies of Zimbabwe as I have said for four years and we will have the same results.
“… the Fed apparantly thinks …”
The Bernank apparantly doesn’t see that he has much choice to think differently. Much of the nation’s wealth (choke) is tied up in real estate, and this real estate is what backs a lot of debt held by banks, an the Fed is the banker of last resort.
Keep RE prices elevated and you keep banks whole (choke).
If only the banks could offload all of their bad real estate assets onto a group who the Fed cares about relatively less, they could end their policy of real estate price supports.
And these groups could be financed by, what? - healthy doses of OPM, maybe?
If I were the Bernank I would be paying a lot of lip service to getting stashes of money off the sidelines and into the economy, RE in particular.
Off the sidelines? Try: off the shorelines.
08/07/2012
Big investment companies pile into single family foreclosed homes
http://www.property4peanuts.com/property-in-usa-news-240.html
All of a sudden, it seems, everyone on Wall Street wants a foreclosed home.
Your house might be a better investment than you think. At least Wall Street seems to think so.
For a while now the conventional wisdom on real estate has been that while home prices might not fall much more, they aren’t likely to go up anytime soon either. The best personal finance advice, then, when it came to buying a house, was to buy as little as possible.
Apparently, though, on Wall Street that common wisdom about home prices is not held by all, or even many. In the past six months or so, a number of investment firms, hedge funds, private equity partnerships and real estate investors have turned into voracious buyers of single-family homes. And not just any homes, but foreclosures.
Investment banks, who also want in on the action, are lining up financing options to keep the purchases going.
Interesting that they say “single family homes.” I guess they aren’t interested in condoze?
Sadly, it appears that higher prices serve to deter foreign-investor demand.
Real Estate
Foreign buyers are staying home
Rising prices, disappearing bargains and economic troubles at home are quickly thinning the ranks of foreign property buyers. Who, just a few months ago, were being hailed as a major force in Florida markets and other resort destinations.
Published: Sept. 13, 2012 at 5:33 PM
By Real Estate Economy Watch
Foreign nationals spent about $82.5 billion in the 12-month period ending in March 2012-up about 24 percent from the $66 billion they spent the year before-but only 9 percent of all residential real estate sales come from international buyers, according to a report from the National Association of Realtors released six months ago.
However, every month since then with the exception of May, NAR reported foreign nationals have purchased only 2 percent of all homes sold, the same level as in most of 2010 when the foreign buyer boomlet began.
In July, the real estate site Trulia reported a decline in the international share of overall online house hunters in the second quarter. From April 1 to June 30 the share of foreign searches on Trulia fell nearly 10 percent year over year in the second quarter, with the fastest appreciating markets seeing the biggest declines in foreign interest.
“Foreigners attracted to real estate bargains get turned off when prices increase,” said Jed Kolko, Trulia’s chief economist.
“Investors want to buy when prices are at their bottom, but they’ll start to lose interest when prices rise 15 percent, as they have in Miami and Phoenix. Demand by people looking to scoop up bargains can dry up quickly when prices rise.”
…
Investors Are Looking to Buy Homes by the Thousands
http://www.nytimes.com/2012/04/03/business/investors-are-looking-to-buy-homes-by-the-thousands.html?pagewanted=all
…Waypoint’s appetite: the company, which has bought about 1,200 homes since 2008 — and is now buying five to seven a day — is an early entrant in a business that some deep-pocketed investors are betting is poised to explode.
With home prices down more than a third from their peak and the market swamped with foreclosures, large investors are salivating at the opportunity to buy perhaps thousands of homes at deep discounts and fill them with tenants. Nobody has ever tried this on such a large scale, and critics worry these new investors could face big challenges managing large portfolios of dispersed rental houses. Typically, landlords tend to be individuals or small firms that own just a handful of homes.
Keeping up with thousands of rental units that are actually in thousands of buildings (unlike apartment buildings) will be challenging, but GPS tracking and cell phones go a long way toward eliminating the problem of employees telling you they went to a house when they really went to Starbucks.
Keeping up with thousands of rental units that are actually in thousands of buildings (unlike apartment buildings) will be challenging
HUD does it. But no way would I want HUD as my landlord.
Slumlords make money, and by definition they make terrible landlords. But people rent from lousy LL’s because they need a place to live. Or they pay more to rent from a decent LL who maintains their rentals.
Besides, what the Bernank thinks and what he wants you to think may be two different things.
It’s three different things, counting what he wants you to think he thinks.
The Atlanta Journal-Constitution Sept. 10, 2012
http://www.ajc.com/news/business/companies-go-home-shopping-around-metro-area/nR6yF/
Companies go home-shopping around Metro area
Metro Atlanta’s depressed home prices are drawing the interest of a new type of buyer - companies that buy houses in volume.
Such companies have snapped up foreclosures and short sales in the last few months from Gwinnett to Clayton counties, as well homes listed conventionally by realtors. And they say they plan to spend hundreds of millions on homes in the next two years….
…America is moving toward a “rentership society,….We want to put $1 billion to work buying and renovating homes across the country,” said Chang, a former head of Morgan Stanley’s U.S. housing strategy….Waypoint Homes, of California, has an Atlanta office and similar strategy. Its managers plan to buy $1 billion worth of U.S. homes for long-term rental.
….The competition is helping boost prices, which have been rebounding with a more stable market since late winter. The average foreclosure sale price in metro Atlanta rose between January and June by more than 9 percent from a median of $91,657 to $100,220
…America is moving toward a “rentership society,….We want to put $1 billion to work buying and renovating homes across the country,” said Chang, a former head of Morgan Stanley’s U.S. housing strategy….Waypoint Homes, of California, has an Atlanta office and similar strategy. Its managers plan to buy $1 billion worth of U.S. homes for long-term rental.
Pottersville how sad Maybe they can run the price of gas high enough that these renters won’t be able to afford cars and then they can put vending machines in the rentals that accept snap cards.
can someone please explain to me why the Fed apparently thinks that house prices will rise as interest rates continue to drop?
I can only assume that the FED is betting deep pocketed investors will put a floor under housing prices with cheap leveraged money to buy up inventory.
Not sure it’s even focused on leveraged purchases, but trying to force people into investing in risk assets (leveraged or not). Consider the promise to keep the punchbowl spiked even after people are drunk. From “The Bernank” yesterday:
“we’re trying to convey here is that we’re not going to (be) premature in removing policy accommodation, even after the economy starts to recover more quickly, even after the unemployment rate begins to move down more decisively we’re not going to rush to begin to tighten policy. We’re going to give it some time to make sure the recovery is well established.”
That will make people who were considering buying risk assets slightly less worried that higher rates are going to be coming in any environment other than a stronger job market (which will help the value of risk assets in its own).
I can only assume that the FED is betting deep pocketed investors will put a floor under housing prices with cheap leveraged money to buy up inventory.
I think so too. I posted some articles on this today. Big companies investing up to a billion each.
I can only assume that the FED is betting deep pocketed investors will put a floor under housing prices with cheap leveraged money to buy up inventory
If people can’t afford to buy high priced houses then they also can’t afford to pay sky high rents. There are many folks out there paying 50% of their incomes on housing (owning OR renting). How high can it go?
“How high can it go?”
Welcome to Pottersville.
I’ll try an honest answer.
When comparing the rent vs. buy decision, people compare the monthly costs. A huge chunk of the monthly expense of buying is the cost of renting the money.
Let’s say I live in an overpriced market like San Fran and am thinking of buying for $300K or renting for $1800 a month. Well, at 4%, the PI on $300K is $1500 a month. Add on tax and insurance and the rent is cheaper.
Drop interest rates to 2%, and the PI drops to $1100. Suddenly Buying is cheaper then renting.
Investors and buyers “might” rush out and buy, to “lock in” the lower monthly payments.
Now, speculators, buying with the intention of selling for higher price could get killed by rising rates and falling values. However, if you are buying to live in the rest of your life, or with intention of renting out, then lower monthly payments work in your favor.
People keep talking about inflation, but 1) that requires rising wages to stick. Otherwise increasing prices just causes increased supply and falling demand, and wipes out the inflation. 2) One way we could get inflation is falling value of the dollar on international exchange markets, increasing the price of imports and decreasing the costs of our exports in other countries, bringing jobs back to the USA. 3) Is the falling value of the dollar even a likely problem with Europe and Asia both cranking up the presses also?
Of course, this is all just papering over the trade imbalances by ensuring new money can be borrowed into existence faster than it leaks from circulation. We can’t stop the ever increasing debt without either 1) attacking and reversing the trade imbalances or 2) allowing the economy to crash as the money drains out of circulation.
“I’ll try an honest answer.”
You didn’t try. Once again you misrepresented the truth to the HBB.
Give it a rest. Nothing he just posted is wrong. You’re just starting to look like a stalker.
Yo… hey you.
Darryl The Liar is attempting to define the entire buy side of a market.
Wake up.
No, he is explaining the thought process on the buy side of the market that involves people who are looking to live in a place that they either own or rent in a particular location. Investors think about “the entire buy side of a market.”
Now, people who are not sure they want to stay in that location for a good long time should think about the rest of the market dynamics or they could find themselves underwater, but most are just looking at the monthly nut.
Why do you guys even bother engaging him?
Why do you guys even bother engaging him?”
because homes are massively overpriced
Buy flunkies buy!
People keep talking about inflation, but 1) that requires rising wages to stick. Otherwise increasing prices just causes increased supply and falling demand, and wipes out the inflation.
I need to qualify this. Increasing prices will not cause falling demand on “needs,” like oil, food, health insurance, college loans. So, inflation is NOT wiped out. Instead, what is wiped out is standard of living, as people give up more and more to pay for necessities. Generally it means shacking up more incomes per house. I see it in my own neighborhood, as the streets fill up with old cars.
Wages will increase just liked they did in Zimbabwe and the Weimer republic they just will not keep with inflation. Don’t worry Oxide your mortage will get reduced in real terms by alot.
I just bought a small house in fly over country so wiping out my mortage will not make a difference in my wealth but it will help you a lot. So far with the tax credit I received I am just treading water over the almost three years but I could not have rented the place for any where near my total payment including taxes and all other expenses cost me. Also, the tax writeoffs have been very beneficial.
As prices go up, we’ll see that “needs” do not have quite the flat demand curve that some expect. Carpool, or move back in with your parents? Smaller portions and eat the left overs instead of going out again, or have the kids move in with you? Do you really need to go to the doc for that runny nose, or just wait for it to go away on its own?
Standard of living in decline means reduced demand for oil, food, gold, health care, etc, and that falling demand will hit at the same time we get increased supply, if prices go up.
It is amazing how much free entertainment there is in DC. I almost feel guilty when I actually pay for a ticket, even if it is from one of the half price places.
People are still eating out lots, spending more on the service than the actual food.
The two days a week I go into the office, I’m in the carpool lane and still zooming past the other 4 lanes, that are stop and go, with one person per car. There were a lot more people car pooling in 2007, then today. Difference is, there are fewer Hummers and other giant SUVs, and more small cars and hybrids in those non-carpool lanes.
“…It is amazing how much free entertainment there is in DC….”
There’s a whole lot of free entertainment to be had here in East Jesu, too! You can drive over the mountain to the Vons market and watch the tattooed persons buy six packs and ammo. You can flood the varmit holes with hose water and swat flies out on the porch. You can tour the stately trailer parks of Lake Isabella….
Not a whole lot of Coriolanus, though.
So, inflation is NOT wiped out. Instead, what is wiped out is standard of living,
I agree in in part but I think it’s a tug of war. It seems that overnight a can of mass-market beer in Rio went from R$1.29 to R$1.59 in the supermarket. Is beer a necessity? In Rio, it is a little bit. Will beer go lower in price if people buy less? How could it if grain and transportation costs go higher or if supermarkets and brewers start making less money?
I think I better drink beer now before I’m priced out forever.
When you’re so wealthy that owning ANY real estate is nothing but a tax write-off, you can afford to mistake the map for the terrain.
It’s often called the “McNamara Effect’.
It will increase HELOC’s
I have a friend in debt up to his eyeballs who has refinanced 3 x in the last 6 years. Used the money to by an SUV.
If I had never been told by the PTB that the Fed “controls” interest rates, I might think that they are fighting a desperate battle against deflation. I might think that they are steadily losing ground. I might think that their money printing is aimed at keeping banks solvent as their debt pyramid deflates. I might think that their suppository injections into asset prices will constipate the whole system to the point that failing debtors, unable to service their debts will become unable to service their basic needs because these needs are bloated assets belonging to the banks. I might think that asset prices will become meaningless as few except the banks themselves will have any surplus means to trade in them. I wouldn’t want to be a helpless debt hampster at that point.
This is all ridiculous of course, because the Fed is in charge of everything, and they are here to help us.
Nice post, Blue.
Haven’t been able to read all the news/HBB the past week but isn’t part of it MBS bond buying by the Fed? So, I read it as not rates being key so much as loose lending coming back into vogue. More people (who think they’re still buying “low”) qualify and buy, echo mania ensues, even more demand created, prices go up.
Never thought it would come to this…and I hope it crashes miserably.
But the Fed isn’t doing the underwriting. They are simply buying debt. They will be crowding out other investors…primarily effecting rates.
Because the Fed isn’t pledging to buy ALL MBS, the actual underwriters need to be able to sell them to the same people they are selling them to today.
The Fed is buying “Agency” debt… Freddie, Fannie conforming. That means FULL documentation including a couple years tax returns, W2s, income and employment verification debt/income ratios, etc. etc.
Thank you Sleepless.
My initial query was in response to jbunni’s post yesterday referencing an historic inverse relationship between interest rates and house prices. As that is certainly not the case these days, why the claim that if interest rates go to 1% housing prices will skyrocket?
Ah. I see. I do think it works early in the cycle. When rates started dropping in Portland in earnest around 2002-ish, prices stayed level for about 6-12 months as people got the same priced house for less monthly outlay. Shortly after, prices did indeed go up, as more people entered the market. (of course, loose lending also played into it at the time). But I agree, not so much at the end of the cycle as a means to continue the good times.
I think the opposite would most certainly happen in reverse. If rates went up to 5% tomorrow, housing prices would stay level for a bit as people paid more per month on the same priced house and there would be a rush to “get in” on the belief that, since housing “ALWAYS goes up in the long term,” housing was about to get more expensive with higher rates. Longer term they’d continue to drop as rates continued upward…
“It was like riding a tiger, not knowing how to get off without being eaten.” — Ramalinga Raju
The Fed is riding the tiger.
and looking for another tiger to ride.
” the Fed apparently thinks that house prices will rise as interest rates continue to drop…”
I don’t think they think what you think they think.
An interesting question would be what they hope to accomplish and why.
Sometimes architecture is just so awesomely bad it deserves honorable mention on HBB. CRE with clodhoppers:
http://www.telegraph.co.uk/news/worldnews/asia/china/9520245/British-designed-skyscraper-resembles-big-pants-say-angry-Chinese.html
I’m not Chinese. And that building’s design offends me too.
Look more like low rise jeans than the underpants mentioned in the article, but either way, it is terrible.
If they added an arch-shape of upper floors, that might solve it, assuming the legs would hold the weight. Instead of pants it would just be a thick arch.
They just need to build a high-speed elevator shaft in the center and it will be perfect!
Hey, who wears the pants in this world?
+1
*shrug* Basic gateway arch design. Nothing ground breaking or offensive.
Just boring.
Not offensive without the genitals.
Is it me or does the base look like a pair of shoes?
Not just you.
“Clodhoppers”
We called them sh-t kickers….
When it’s done they should but a belt on it, preferably one with a big honking belt buckle.
GERMAN PRESIDENT Joachim Gauck has signed the European Stability Mechanism (ESM) bill, a day after the country’s highest court dismissed several constitutional challenges to the bailout fund.
The €700 billion instrument, a cornerstone of the euro zone crisis-fighting strategy, will not become law until the government addresses constitutional court concerns on German liability and Bundestag information rights from the ESM.
While Wednesday’s court ruling was greeted with relief in the Bundestag and around Europe, it attracted a uniformly negative verdict in the German media yesterday. The influential newspaper Bild dubbed the verdict “Merkel’s expensive victory”.
“What’s clear is that, with the ESM billions . . . every euro debtor state can let itself be saved, whether it has earned this or not,” it told its eight million readers.
“That,” it added, “is what makes it so maddening.”
http://www.irishtimes.com/newspaper/world/2012/0914/1224324009568.html?via=rel?via=rel
Suppose the global central banking cartel pulled off an internationally-orchestrated quantitative easing shock-and-awe campaign, and nobody even noticed?
Unpossible!
Jim Rogers noticed… he’s been saying for some time that commodities was the place to be because if the economy takes off, then demand will increase and if the economy tanks, the central banks will print and money will flow “into the real”.
Also, Bill Gross noticed. His most recent tweet on Twitter, per Zerohedge:
Gross: #Fed to buy mortgages ‘til the cows come home. Think 7% unemployment, 2.5% inflation targets. Buy real assets…gold…a house!
Now both are probably talking their book, but in this case they’re right. Gold and Housing are where you want to be as the central bankers inflate. Cash is to be avoided. This is the 70’s under Carter all over again. This will all end badly…
So when an MLS listing headlines “Short Sale”, can you reaaaaaally believe it? How do you know? How can you confirm it’s a shortsale?
If it comes from the real estate industry, don’t trust it further than you can swing a bull by the tail. And do your own verification.
That is my thought too Arizona Slim. The listing states “Bank Approved Short Sale”. It’s been on the market for 14 months and the seller chased the price down 10% in small increments. This time they whacked the price 15% in one fell swoop with the new headline. It’s still overpriced considerably and I’m not going to waste time if the used house racketeers are lying about it being a “bank approved shortsale”.
Look up the sale price history in public records.
Frank
As much as they are lying pos, a short sale is a short sale. The only ones we entertained (in general) during our search was pre-approved ones. Otherwise, there is a 50/50 chance the price will be agreed upon in the MBS market, and the transaction will close. Beware of really low teaser prices. When the real market (MSRP)price comes back from the bank, your eyeballs will pop out.
For FREE, you can go to zillow and type in the street name, city, state, and see if the sq ft and lot size matches a foreclosure hit on that street. If it already has an NOD on it, and is in process of foreclosure, Zillow will capture it.
Frank
Zillow:If you can find a home using Redfin in the same area, type it into the search at Zillow and all the current actives, pendings, and foreclosure activity homes will how up on the bottom of the page. Scroll pages until you see the stats that match your home of interest.
Otherwise, you can suscribe to a foreclosure service like Foreclosure Radar, but it costs money.FR was our favorite.
Foreclosure Truth (Sean O’Toole’s Blog-CEO FR) is another great source for info and thruthiness.
Here in AZ, you could look up the owner’s name in the county assessor’s website, then look up that person/entity in the county recorded to find the dead of trust to see how much the mortgage against the property is/was. You could probably then extrapolate, based on sale price, how upside down the property is.
The bigger question is, why would anyone lie about it being a short sale. As buyer, you should stay away from short-sales, if possible. You have to wait 3-4 months for bank approval, and then the bank can come back and torpedo the deal or demand a higher sale price.
it is like giving the bank a free call option. They lock in today’s price in the contract with you, then can demand a higher price 3-4 months of now.
Here in AZ, you could look up the owner’s name in the county assessor’s website, then look up that person/entity in the county recorded to find the dead of trust to see how much the mortgage against the property is/was.
Here in Brazil, you can’t do squat.
Posted: 6:16 a.m. Friday, Sept. 14, 2012
HK worries Fed move will overheat property
The Associated Press
HONG KONG —
The Fed’s latest plan to spend billions on securities is being hailed by investors desperate for economic salvation. But in Hong Kong it’s causing headaches for policymakers worried about a frothy property market.
Officials in the southern Chinese financial center said on Friday they were concerned about the local housing market overheating following the Federal Reserve’s latest move to revive the U.S. economy.
Because Hong Kong’s currency is pegged to the U.S. dollar, officials can’t raise interest rates to cool the property market. Instead, they instead must follow U.S. monetary policy.
Officials announced tighter requirements on mortgage borrowers aimed at cooling the property market and protecting the banking sector.
Hong Kong house prices have surged because of low interest rates, easy credit and an influx of money from mainland China.
Copyright The Associated Press
Hey China, Hong Kong… Unpeg your currency from the dollar. Yours in highest regard, Helicopter Ben
It’s going to get painfull for China long before it get’s painfull here. Many earn only enough for food and shelter. If food prices double the chinese equivalent of Joe 6 pack is going to be mighty mad.
ISTR seeing a cell phone video of laid off Chinese factory workers going on a rampage. They really trashed their former place of employment.
Plus, Hong Kong has been threatened by mainland China as of late.
Not a good situation.
I’ve been so involved with a seller that can’t commit to a COE date, that I haven’t been keeping up with the economic shenanigans. Thank God for the HBB.
We got the seller down in price, put all the contingencies behind us, and are now dealing with closing this deal. They have moved the COE three times already. We want to wire transfer the funds, and are stuck in limbo.
I almost had to move the closing based on deposit lock durations, but was able to work it out. Closing scheduled for today, 29 days after our offer was accepted.
Darrell,
Congrats on the new place. I am very happy for you guys, and wish you all happy memories in your new home. A new chapter of your lives, and soon to be your first holiday season as well. Hip Hip Hooray!
It is so hard to be an able and ready buyer, and have a seller who can’t keep a firm date. We’ll get there as well.
Closing happened an hour ago. Transfer of title recorded. Still waiting to get the keys.
It isn’t a new place for me. It is a new place to house my kids.
You are a Dad for the ages. May they bless you, Darrell, and may your purchase be more lark than albatross for all involved.
Congrats Darrell. 40 days of escrow seems as long as 9 months of pregnancy, to me. No keys yet. We hope to put in new floors and move before the end of this month.
Y’all will know when I have the keys cuz I’ll have to change my moniker.
sfrenter
Congrats. I am so happy for you guys.
Isn’t flooring expensive!
We are set to close Monday, Sept 24th.
Why do you play their games?
Never forget that as the buyer, the CUSTOMER, they should be kissing your ass.
This is why this country is so screwed up. We’ve conditioned customers to thank the people screwing them and the seller to think the customer owes them a living.
Yeah… there is something being played here. And it’s you.
Aaahhhh, did I hit a nerve?
You hit your head while putting your foot in your mouth.
turkey and pimp
We signed a contract with earnest deposit money at risk. Although I agree with the principle of the customer rules, the reality is contract law rules.
turkey
No nerve hit my dear, just a dose of the real world. We po’ folk get in trouble when we don’t follow contract law.Stoked about the deal and the home. Are ya happy for us? I rejoice when someone is happy. You ought to try it.
Then walk away.
I’ve been so involved with a seller that can’t commit to a COE date
Banana
We’ve removed all our buyer contingencies, and have a home run a com’in. It took 4 years to find this place, and we hammered them down in price. We’re waiting this out.From a legal standpoint, walking could possibly trigger our earnest money as a forefiet. No thanks.
Ah. I didn’t realize you were this far along and committed.
The yes, all you can do is wait.
oops “forfeit”
Three Things Fed Did Today That It’s Never Done Before
But the Fed’s new policy is far more radical than this description might suggest. Several features of the policy mark a stark departure from past practices.
1. Open-Ended Expansion. In the past, when the Fed announced a Large Scale Asset Purchase program—LSAP, in Fed speak—it indicated its maximum size and duration. Sometimes it revisited the duration or size, expanding the programs as necessary.
2. Targeted at Labor Market. Perhaps even more importantly, the Fed’s policy is very explicitly tied to the labor market.
“If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability,” the Fed said in its official statement.
3. Not Tied To New Weakness. The Fed’s statement was actually pretty upbeat about the economy.
What the Fed did today was announce that its policy was not based on a forecast of things getting worse—but on a desire for things to improve faster. In short, it announced that the central bank intended to change the pace of recovery.
This is a bold new world for Fed policy.
http://www.cnbc.com/id/49022934
Hmmm, wonder why they’re in such a hurry at this time of the cycle. It would seem to be too late to help Obama, but then again, maybe not.
I think it’s pretty funny that they blame economic weakness on Main Street but target their brand-new money toward Wall Street. That conundrum alone is enough to disprove trickle-down economics.
Trickle down was DOA. I’m connived that this nation is/was so dumb they don’t even know what a “trickle” really is/was.
“convinced”
Oxide and Turkey Lurkey,
Actually, I disagree with your assessments on trickle down economics.
It seems to me that they’re trying to apply the Keynesian processes when they’ve already tried them in QE1 and QE2. Only this time they’re going to keep repeating the process on a monthly basis until it actually works.
Lip
Only this time they’re going to keep repeating the process on a monthly basis until it actually works.
“The beatings will continue until moral improves”. - Japanese Submarine Commander circa WWII
Keynes only works in a closed system. Spend now, it comes back later. Save now, spend later… all predicated on a closed system.
It doesn’t work when money is going to other countries, never to return. No matter what we try, the end result will be the same: dorms and suicide nets.
Most interesting is that Congress and the President believe that the Fed is assigned the responsibility of fixing the labor market.
Say what?
MacBeth
I’ve always thought that was a wth myself. Do the ptb say that with a straight face? The sad part is, people believe such nonsense.
I don’t think it’s that people believe such nonsense, it’s just that they don’t know any better.
Can’t blame them; no one can know everything.
I place blame on those who DO know, and knowingly screw those who don’t. In this case, Congress and the President.
Despite all his mistakes, Bernacke has publicly stated that the labor market is not the Federal Reserve’s responsibility.
Or the belief that giving money banks will in anyway help anyone other than senior banking management. 40 billion for nuthing indefinitely. What a plan.
The Fed has a dual mandate from Congress: stable prices and full employment.
Full employment generally means 5% for the US. Stable prices generally means under 2% inflation. The Fed is failing miserably in both cases.
If I were Romney, it would be a pretty clear message…that the economy needs so much help that the Fed is resorting to unprecedented measures.
That’s such a “teed-up” argument, that I’m not sure how much the Fed action is helping Obama.
If I were Romney I would make my campaign against the three headed monsters - Obama, Geithner and Bernanke.
Too bad for Romney, he’s the fourth head.
Okay, another morning but with a fresh dose of QE3. So what do we see from this recent injection and how it will impact our lives:
–Price of Gold - Up
–USD - Dn
–Commodities - Up
–OIL - Up Up
–Salaries - Dn
–Inflation - Up (not recorded)
–Hyperinflation - Not recorded
Any others????
Which results in even fewer buyers.
It’s the price. It’s always the price.
Employment - Dn
Also
Home sales - Dn (after possible temporary spike)
Home prices - Up
It’s a Fed-funded, jobless housing market non-recovery.
Wanted to ask Combo:
Is CASH still king? Would Dollar not be crushed in the long run with so much liquidity?
Is cash hard to get? Is it easy for people who need it to borrow it?
Are wages rising? Are good-paying jobs plentiful?
Cash and cash flow, both are king.
What’s ther return of the float? Are insurance annuities going to be able to keep their promises? Are pensions?
If you roll over a good-paying CD you took out several years ago what return are you now going to get?
Cash rules whenever there is a shortage of the stuff.
“If you roll over a good-paying CD you took out several years ago what return are you now going to get?”
Was in the bank yesterday moving money. 1 year CD = 0% 3 year = 0.1%. 5 year= 0.15% 10 year = 0.25% 10 year jumbo of more than $10K = 0.35%
“Cash rules whenever there is a shortage of the stuff.”
And when everything else looks grossly inflated.
I’m hedged. Lots of cash if deflation continues as I expect, but some investments just in case the PTB decide to hyperinflate.
USAA is paying 0.35% on a 91 day standard (min amount $1000) CD. 7 year is 1.55%. I don’t see a 10 year listed.
https://www.usaa.com/inet/pages/bank_cd_rates?SearchRanking=2&SearchLinkPhrase=cd rates
Darrell, you need a new bank. The rates truly suck, but not hard to find far better than you are seeing.
-Price of houses - Up
-Inventory of houses - Down
-Home sales transactions volume - Down, after temporary spike
-Housing affordability - Down
Southern California housing market posts strong August
A sign advertising a home for sale in Los Angeles. (Kevork Djansezian/Getty Images / September 13, 2012)
By Alejandro Lazo
September 13, 2012, 9:52 a.m.
Home sales in Southern California hit their highest level for an August in six years last month, and the median price for a home in the region rose to a four-year high.
Sales rose 9.0% from the previous month and were 14.2% from the same month last year to total 22,438, real estate firm DataQuick reported. The lift in sales came as fewer foreclosures and low-end homes sold and the market for move-up and high-end up homes heated up, the firm reported.
The region’s median home price — the point at which half the homes in the area sold for more and half for less — hit $309,000 last month. That was up 1.0% from the prior month and 10.8% from the same month a year earlier.
[Updated at 9:58 a.m.: August marks the last month of the busy spring and summer season and sales should cool off as the fall and winter months approach.
“August was the strongest month for home sales so far this year, and the strongest for an August in six years. That’s really saying something given the drop in low-end sales, especially foreclosure resales,” DataQuick president John Walsh said in a news release. “Strong seasonal forces should be kicking in now. Absent an unusual surge in demand this fall, sales will taper off over the next few months.”
When looked at regional median home prices year-over-year, the Inland Empire posting the most sizable pop, confirming that the region’s most affordable homes have become the most competitive.
Median home prices rose sharply in the Inland Empire — which during the housing bust was one of the hardest hit regions in the nation — even as sales fell in Riverside County and were up only modestly in San Bernardino. The price spike in the Inland Empire amid lackluster sales underscores a national trend: there is heavy desire for low-end homes and not enough inventory to satisfy that demand.
…
Sometimes strange is going on there.
The state is bankrupt. They have one of the highest unemployment rates in the nation. The highest price houses. Pensions are being cut.
Where IS the money coming from?
Then there’s the real rate of foreclosures…
Me thinks they’re doing NINJAS again.
I wonder from time to time whether the Fed or perhaps Fannie Mae and Freddie Mac are buying SoCal homes to prop up the market. So far as I can tell, economic conditions here are dismal, and given the dismal employment situation, the number of housing transactions in the $500K+ range is surprisingly large.
Without government intervention, who would be buying homes at this price level?
$38T looking for somewhere, anywhere to diversify into.
Low vacancy rates, and despite high unemployment, CA added over 300,000 jobs last year (but built ~35k housing units).
My partner and I were driving around Southern CA, and we were shocked at the rents that people were paying in some unbelievably bad neighborhoods (not asking rents, actually confirmed leases).
My partner’s comment was that in any other market in the US, where lots of homes can be built, the homes in these neighborhoods would be boarded up and abandoned…but in CA, they are rented and people live there.
And the money is coming from institutions who have been starved for yield by the Fed. So buying homes and dealing with the management for a 6-9% unleveraged return is attractive relative to other options. Given the low vacancy rates, the homes are getting rented (even those that should be boarded up and torn down).
Just saw the posts above about the large investment groups.
Insane.
CA added over 300,000 jobs last year (but built ~35k housing units).
The numbers I saw were 240K jobs added and 47K housing units built in 2011. Everything you write about CA tends to be on the sunny side. I wonder why?
I’m talking about in the last 12 months of job creation:
BLS Data:
Non-Seasonally Adjusted Data (Series ID: SMU06000000000000001):
CA non-farm employment
July 2012: 14.279 Million
July 2011: 13.9168 Million
This is ~362k jobs year on year.
From Wells Fargo/NAHB data, year on year, housing starts (single and multi combined) is approximately 52k from July 2011 to July 2012 (29k multi-family with the rest single-family).
I always try to present my data sources with my commentary. I apologize for my inaccuracy on the housing start numbers (in my head was still the 2010 start numbers, which was in the mid-30k’s).
Money is a-flowing ’round here. Too bad it’s not flowing into my pocket.
San Francisco Rents The Highest Of Any City In Country
According to a report released this week by the National Low Income Housing Coalition, San Francisco is the most expensive place in the country to rent housing.
The average rent on a two-bedroom property in the the city is $1,905 per month. The report finds that someone would need to make at least $76,000 a year (or $36.63 per hour) to be able to afford rent without spending over one-third of his or her income on rent. It would take the salaries of 4.6 full-time jobs at San Francisco’s highest-in-the-nation minimum wage to afford a two-bedroom.
While the city’s median family income of about $103,000 is well above what’s needed to afford to live in San Francisco, high rents have the effect of pricing people on the lower side of the economic spectrum out of the market almost entirely.
Rent increases have kicked into overdrive in recent years, as many of the region’s outlying bedroom communities were among the hardest hit in the nation by the foreclosure crisis with throngs of people losing their homes.
“We’ve had a lot of people displaced from home ownership that are coming back into the rental market,” Hessam Nadji of real estate investment firm Marcus and Millichap told CBS San Francisco. “And the rental market in the past four or five years has not had too much new supply added. Therefore, the vacancies have dropped and the rental rates have begun to go up much faster than anyone anticipated.”
“There is a popular misconception that the foreclosure crisis has made San Francisco a more affordable place to live, but renters are not out of the woods,” said Peggy Lee, acting director of the Non-Profit Housing Association of Northern California, in a statement accompanying the report. “A San Francisco pre-school teacher who earns a typical salary of $37,000 a year and is the sole breadwinner, would need to hold down another job to afford to rent a two-bedroom apartment or commute from far away.”
Another factor pushing up rents in San Francisco is the scarcity of available housing. The city’s high density and general aversion to new development makes the construction of new housing both relatively rare and often prohibitively costly. Additionally, the city’s rent control regulations tend to encourage people to stay put and further constricts the supply of open units—although the rules do serve to keep landlords from spiking prices on current tenants, meaning that rent is cheap for those who have lived in San Francisco for a long time but significantly more expensive for recent transplants.
San Francisco’s current social-media fueled technology boom also pushes up rents in certain areas of the city to levels last seen during the heady days of the Dot Com-era–leading some, like The New York Times’ Nick Bilton, to see the looming specter of another tech bubble at work,
The high cost of housing in San Francisco is the main reason cited by the legions of families with children who flee the city for the suburbs every year. Only 13.4 percent of San Francisco’s approximately 800,000 people are under the age of 18–the lowest proportion of kids for any major city in the United States.
“Additionally, the city’s rent control regulations tend to encourage people to stay put and further constricts the supply of open units—although the rules do serve to keep landlords from spiking prices on current tenants, meaning that rent is cheap for those who have lived in San Francisco for a long time but significantly more expensive for recent transplants.”
There is a prop 13 corollary here as well for CA as a whole…property taxes are low for people who have owned their homes for a long time, and much higher for those who have purchased more recently. This serves as a sales deterrent for some people who have owned their home for a long time.
Take a person who in another state would save a ton on taxes, and hassle of yard maintenance by moving into a condo at retirement. In California, it might be quite a bit cheaper to simply hire a gardener and keep your property taxes locked-in.
San Francisco Rents The Highest Of Any City In Country
Having been to 49 states, and lived in 7, (on both coasts,) and lived in CA for 20 plus years, I don’t understand why it would not be.
Food and gas prices go way up. J6P gets hammered again.
Housing prices starting to go up.
Thank you obama for you leadership.
Thank you for your largest and costliest legacy - RE-INFLATING the housing market.
Thank you Obama and Helicopter Ben for trying to keep us on the path that Reagan put us on.
Any others????
Yes, I’m thrilled to point out the surprise to Bennie and the Frauds - 10 year US Treasury prices down, interest rate yield up to 1.89% this morning up from 1.76% yesterday’s close! Hopefully QE3 will backfire on the Fraudulent Reserve sooner rather than later and interest rates have begun their race up to the sky as bond investors are finally realizing the Fraud won’t stop until it achieves rising prices in consumer needs! I’m thinking the end game will be the Fraud owning every US Treasury and MBS (debits) and about $15-$20+ Trillion of currency in circulation (credits) as it tries to keep the lid on interest rates. Then the Fraud will finally get that inflation in prices of consumer needs they’re been wishing for. Too bad for them it’ll be much much more than they wanted, and there won’t be anything those fools can do about it. If they raise interest rates it finally craters asset prices to where they should be in a rational market. Can’t have low interest rates and low prices. One or the other…idiots.
Treasuries up ever so slightly, because QE is being more heavily targeted at mortgage debt and less at treasuries than expected.
I would not expect the move to build into “race up to the sky”.
Inflation was up 0.6% on the month…announced this morning.
Inflation - Up (and recorded)
In So Ca (Ventura County) the DOM has increased, so I don’t think QE3 will pump prices up going forward. I was seeing a trend of inflation for the last 3 months (took it as seasonal), and it caused bidding wars, which seem to have subsided. Inventory or not, empirical evidence suggests prices aren’t going anywhere in our local housing market.
And here’s Firedoglake’s David Dayen, putting a match to all that housing happy talk we’re hearing in the MSM. Article:
The Path for Housing Is Dangerous
Key point: “…if you think that an investor-heavy market of house-flippers, with little recourse for those underwater but to sit tight and hope, and a nation of absentee slumlords redlining neighborhoods is something healthy, well you’re in luck, because that’s what we’re getting.”
“…with little recourse for those underwater but to sit tight and hope,…”
At least they can refinance their underwater mortgages at the lowest interest rates on record.
If they can’t afford the closing costs of the refi, well, there they sit. Or there they walk.
Sit tight and hope and keep paying on that mortgage and keep that house maintained.
And the rock-bottom refinancing rates free up cash for maintenance expenses, not to mention higher property tax bills.
I am amazed to learn that an armchair quarterback can have more fumbles over a short period of time than the guy on the field calling the plays. What does this portend if he actually wins the election?
Another episode in Romney’s foreign policy follies
By Jules Witcover
September 14, 2012
Once again, with his intemperate criticisms of the handling of the anti-American episodes in Egypt and Libya, Mitt Romney has leaped before looking into the arena of President Barack Obama’s greatest political strength.
In accusing the Obama administration of apologizing in the wake of an attack on the American embassy in Cairo and the killing of the U.S. ambassador in Benghazi, Mr. Romney has laid himself open to the charge of politicizing a foreign policy crisis. Worse, he has at least temporarily shifted the focus of the presidential campaign away from his strongest debating point, the stalled economy at home.
…
I don’t see how all the sidelines propaganda in the world is going to undo the political damage from this incident.
Romney tends to ‘shoot first, aim later,’ Obama retorts after Romney’s Mideast criticism
Manuel Balce Ceneta/Associated Press - President Barack Obama speaks in the Rose Garden of the White House in Washington, Wednesday, Sept. 12, 2012.
By Associated Press, Published: September 12
WASHINGTON — Republican challenger Mitt Romney accused President Barack Obama’s administration on Wednesday of showing weakness in the face of tumultuous events that left four U.S. diplomats dead in the Middle East and jolted the race for the White House. Obama retorted that his rival “seems to have a tendency to shoot first and aim later.”
Even some Republicans questioned Romney’s handling of the issue, calling it hasty. Top GOP leaders in Congress pointedly declined to endorse his criticism of the president.
…
I don’t see how all the sidelines propaganda in the world is going to undo the political damage from this incident.
While Romney may have gaffed on this one, Obama and Clinton are looking weak and apologetic, given the last time an American diplomat was killed was in 1979. I keep saying it, because it seems to be true: we’re reliving Carter’s 70’s. The only thing missing is disco…
The only politician I see speaking the truth and asking hard questions is Rand Paul. He wants all US aid cut to Egypt and Libya, among others. Keep in mind, there is a bill before Congress currently regarding debt forgiveness for Egypt to the US over 1 Billion. Nice to know our tax dollars are being given to supporters of extremists by the likes of Obama, Hillary, Pelosi, Kerry, and even McCain.
Would Rand Paul cut aids to Israel? If not he is part of the problem.
This was discussed on CNN yesterday. My understanding is that Rand Paul does support pulling aid from Israel, but not because he doesn’t see them as allies. More that he doesn’t think monetary aid to Israel is affordable given our deficit.
Bernanke just announced 40 Billion a month to rich banksters and we can’t afford a billion or 2?
In the context of a $16 Trillion dollar deficit and the looming specter of sequestration and the fiscal cliff coming, yes… $2 Billion is too much.
Especially when it was an Israeli who produced the film that sparked this latest bit of unrest in MENA, India, and Indonesia. And no one is mentioning the fact that the film was funded by wealthy Jewish donors… and yet it is US embassies under attack.
The problems with the neocons in general. Penny wise and pound foolish.
“…Bernanke just announced 40 Billion a month to rich banksters and we can’t afford a billion or 2…?”
Start naming “rich banksters” and see if you can find a common denominator.
Would Rand Paul cut aids to Israel? If not he is part of the problem.
I would think he might under the same circumstances, were they to kill the ambassador.
“Especially when it was an Israeli who produced the film that sparked this latest bit of unrest in MENA, India, and Indonesia. And no one is mentioning the fact that the film was funded by wealthy Jewish donors… and yet it is US embassies under attack.”
Maybe they aren’t mentioning it because none of it is true. The AP has been doing a great job on this story.
http://www.usatoday.com/news/world/story/2012/09/13/us-identifies-anti-muslim-filmmaker/57777522/1
Teases:
WASHINGTON (AP) — Federal authorities have identified a Coptic Christian in southern California who is on probation after his conviction for financial crimes as the key figure behind the anti-Muslim film that ignited mob violence against U.S. embassies across the Mideast, a U.S. law enforcement official told The Associated Press on Thursday.
[and this]
Nakoula told the AP in an interview outside Los Angeles on Wednesday that he managed logistics for the company that produced the film. Nakoula denied he was Bacile and said he did not direct the film, though he said he knew Bacile.
Federal court papers filed against Nakoula in a 2010 criminal prosecution noted that he had used numerous aliases, including Nicola Bacily, Robert Bacily, Erwin Salameh and others.
During a conversation outside his home, Nakoula offered his driver’s license to show his identity but kept his thumb over his middle name, Basseley. Records checks by the AP subsequently found that middle name as well as other connections to the Bacile persona.
The AP located the man calling himself Bacile after obtaining his cellphone number from Morris Sadek, a conservative Coptic Christian in the U.S. who has promoted the anti-Muslim film in recent days on his website. Egypt’s Christian Coptic populace has long decried what they describe as a history of discrimination and occasional violence from the country’s Muslim majority.
Pastor Terry Jones of Gainesville, Fla., who sparked outrage in the Arab world when he burned Qurans on the ninth anniversary of 9/11, said he spoke with the movie’s director on the phone Wednesday and prayed for him. Jones said he has not met the filmmaker in person but added that the man contacted him a few weeks ago about promoting the movie. Jones and others who have dealt with the filmmaker said Wednesday that Bacile was hiding his real identity.
“I have not met him. Sam Bacile, that is not his real name,” Jones said. “He is definitely in hiding and does not reveal his identity.”
The YouTube account under the username “Sam Bacile” was used to publish excerpts of the provocative movie in July and was used to post comments online as recently as Tuesday, including this defense of the film written in Arabic: “It is a 100 percent American movie, you cows.”
Nakoula, who talked guardedly with AP about his role, pleaded no contest in 2010 to federal bank fraud charges in California and was ordered to pay more than $790,000 in restitution. He was also sentenced to 21 months in federal prison and was ordered not to use computers or the Internet for five years without approval from his probation officer.
[and]
“The entire cast and crew are extremely upset and feel taken advantage of by the producer,” said the statement, obtained by the Los Angeles Times. “We are 100 percent not behind this film and were grossly misled about its intent and purpose. We are shocked by the drastic rewrites of the script and lies that were told to all involved. We are deeply saddened by the tragedies that have occurred.”
One of the actresses, Cindy Lee Garcia, told KERO-TV in Bakersfield that the film was originally titled “Desert Warriors” and the script did not contain offensive references to Islam.
“When I found out this movie had caused all this havoc, I called Sam and asked him why, what happened, why did he do this? I said, ‘Why did you do this to us, to me and to us?’ And he said, ‘Tell the world that it wasn’t you that did it, it was me, the one who wrote the script, because I’m tired of the radical Muslims running around killing everyone,’” she said.
Garcia said the director, who called himself Sam Bacile, told her then that he was Egyptian.
The man identifying himself as Bacile told the AP he was an Israeli-born, 56-year-old Jewish writer and director. But a Christian activist involved in the film project, Steve Klein, told the AP on Wednesday that Bacile was a pseudonym and that the man was Christian. Klein had told the AP on Tuesday that the filmmaker was an Israeli Jew who was concerned for family members who live in Egypt.
Maybe they aren’t mentioning it because none of it is true.
What’s not true? That the man is Israeli born? That he’s Jewish? Regarding the following from your post, which is it? Is he Christian? Is he Egyptian? Is he Israeli?
The man identifying himself as Bacile told the AP he was an Israeli-born, 56-year-old Jewish writer and director. But a Christian activist involved in the film project, Steve Klein, told the AP on Wednesday that Bacile was a pseudonym and that the man was Christian. Klein had told the AP on Tuesday that the filmmaker was an Israeli Jew who was concerned for family members who live in Egypt.
He is a coptic Christian. Probably Egyptian (or family from Egypt). Lives in the US. Criminal. There has been some conversation that there isn’t even an actual movie. The trailer may be all they have. As originally filmed, it had nothing to do with Mohammed as the name the actors used was “Master George” and substitutions were dubbed in.
Just go read something in whatever news source you trust. The corrections are all over the place. I tried to give you one of the longer and more complete ones that explained the process of the investigation, not just the conclusions, but evidently that was a mistake.
Obama and Clinton are looking weak and apologetic
Nice try channeling Karl Rove spin but you’re spouting drivel.
Romney foreign policy attack was disgraceful
http://edition.cnn.com/2012/09/13/opinion/avlon-romney-libya-attack/index.html
“a wide array of Republican foreign policy experts rose to condemn Romney’s comments”
“Partisanship ought to end at the water’s edge” is a longstanding adage of American politics.
But in the hours after the death of the first U.S. ambassador killed in decades, Mitt Romney — panicked as his poll numbers have slipped — punched hard against the president, unleashing an unwise, inaccurate and unpresidential attack on the Obama administration….
….At a moment when sovereign U.S. soil was under attack by Islamist radicals, the Romney campaign tried to tie the president to those extremists attacking us, saying that he had “sympathy” with their cause.
And then, in the clear light of morning, Mitt Romney doubled down on the claim, repeating it — perhaps for fear of appearing weak — and his campaign released talking points to hammer home the point. He picked precisely the wrong time, and over the wrong issue, to go “bold.”
This is not just politics as usual but something far lower. By point of comparison, when Ronald Reagan was confronted with the downed-helicopter rescue mission ordered by President Jimmy Carter to save the American hostages in the U.S. Embassy in Iran, he did not see it as opportunity to score political points. Instead, Reagan said, “This is the time for us as a nation and a people to stand united.” Likewise, George H.W. Bush, then also running for president, said “I unequivocally support the president of the United States — no ifs, ands or buts — and it certainly is not a time to try to go one-up politically. He made a difficult, courageous decision.”
Partisan politics aside, why isn’t anyone talking about the foreign policy that is fomenting this kind of activity?
Romney not showing unity in times of crisis or Obama referring to Egypt something other than an ally are more important? Take your heads out of the sand.
heads out of Obama’s cr0tch
This is not an X-rated blog. You should leave your probably repressed desires out of it.
I don’t disagree with you that Romney shouldn’t have politicized the death of an ambassador like that. However, I heard Hilary’s comments to the press regarding the attack and it was weak. Along the lines of “the content of the film was reprehensible, but in the US, we have freedom of speech”. Where was the full threat and power of the US warning our enemies that attacking our interests would not be tolerated? So she blames the content and not the perpetrators?
And just as left blamed Bush for Katrina, as the failure was on his watch, Obama will be blamed for his administration allowing a diplomat to be killed. Not since Carter has something like that happened. It also brings into question the Obama Administration’s support for the new Libya government and the aid given in ousting Gaddaffi… how long have we had a consulate in Libya under Gaddaffi? For how long was the US Embassy safe in Libya under Gaddaffi?
why isn’t anyone talking about the foreign policy that is fomenting this kind of activity?
In some circles, the thought is the unrest is not an issue of US foreign policy. The unrest is because of the massive inflation being unleashed on the global economy, and yes, the Federal Reserve has the lion’s share of blame.
Remember, the “Arab Spring” started in Tunisia with a fruit vendor who couldn’t feed his family because he didn’t have a “permit” to sell fruit. Much of MENA has protested because they can’t afford food…
This is not an X-rated blog.
Truth hurts, doesn’t it?
Truth hurts, doesn’t it?
Not as much as ignoring it. You sound repressed. If you want to do what you talk about, just do it. Maybe then you’d be less hostile and crude.
With a poor harvest and QE3 this round won’t be a spring, it will be a series of Geysers.
Here you go…
http://www.youtube.com/watch?v=97RjuC9YeXg
OK tacky 70’s
http://www.youtube.com/watch?v=6QXyqk9flwk
“The only thing missing is disco…”
Dear God, aren’t we suffering enough?
Is this one more of your “non-partisan, responding only to trolls, independent thinking, non-Obama suppporting” postings?
It would seem, in the media’s eyes at least, that neither Obama nor Romney are doing a bang-up job on diplomacy lately.
http://firstread.nbcnews.com/_news/2012/09/12/13836414-obama-egypt-not-an-ally-of-us-but-not-an-enemy?lite
Also this: http://www.jpost.com/Headlines/Article.aspx?id=284684
Taken in conjunction with reports of Marines being banned from carrying live ammo, doesn’t show a very good understanding of your surroundings.
“reports of Marines being banned from carrying live ammo”
I don’t buy it. As SSDF we used to carry weaps and ammo even in homeport. Just didn’t l&l until it was necessary.
http://www.kforcegov.com/Services/IS/NightWatch/NightWatch_12000175.aspx
People will believe what they want to believe short of a memo directly from Patterson herself.
All that page says is “according to USMC blogs”. They don’t provide any links to these blogs. Everybody talks about these blogs, but no one has any links?
http://www.beaufortobserver.net/Articles-NEWS-and-COMMENTARY-c-2012-09-13-262662.112112-Reports-U-S-Marines-guarding-Egyptian-Embassy-denied-live-ammo-to-use-in-the-weapons-if-needed.html
“Pentagon Lt. Col. Chris Hughes told the outlet [Washington Free Beacon]: ‘The ambassador and RSO (Regional Security Officer) have been completely and appropriately engaged with the security situation. No restrictions on weapons or weapons status have been imposed. This information comes from the Det Commander at AMEMB (American Embassy) Cairo.’ “
Dang it samk, why did you have to go and ruin a perfectly good fantasy?
I tell ya, some people got no respect for other peoples’ hate these days.
Whoa, whoa, whoa Turbo!
It said: “No restrictions on weapons or weapons status have been imposed.”
That doesn’t say they were locked and loaded, that say that there were no restrictions on weapon status. You realize there is more than one weapons status, right? If I recall correctly from my past experience on an embassy compound in the ME there were green, yellow and red.
Green: Unloaded
Yellow: Mag in the well, no round chambered, safe
Red: Hot
I don’t see anything in that article that tells me that Marines were cleared hot.
Further, if they had a weeks notice, don’t you think there would be some very clearly defined ROE in place? No mention of those either.
No reason to be hot until you are taking incoming fire. See the weapons in the hands of the protesters.
We had similar status when doing training when I was in the SeaBees. As an E6 in charge of a squad, I was not authorized to order magazines in weapons until we saw weapons. We were not authorized rounds in the chamber until taking in-coming fire.
Rocks and bottles only counted if close and large enough, and we lacked cover, so that serious injury was likely to result.
Our military works pretty hard to avoid a “Boston Massacre” type situation, except given the circumstances of that event weapons hot would be authorized.
6 individuals breached the perimeter of the Embassy in Egypt and were detained by the Marine Security Group without loss of life.
Whether or not their weapons were locked and loaded the Marines did their jobs quickly and professionally.
“Is this one more of your “non-partisan, responding only to trolls, independent thinking, non-Obama suppporting” postings?”
posting for dollar$$$
Agree. Those other guys were amatuer trolls just venting. This guy has a professional gloss. He not here to vent; he’s here to proseletyze and recruit.
And I bet he makes more than the $9/hour offered for that small business accounting job.
he’s here to proseletyze and recruit.
Who?
“Ryan.”
I’m not picking up the anger that is usually seen from the partisan posters (including me), or the parroted talking point. Ryan is armed with semi-obscure sources to back up the talking points. He’s trying to convince.
Which semi-obscure sources are you referring too? Is it possible that perhaps I come from different walk of life and have a different point of view? Or, out of hand, I’m just a bought and paid for pundit because we disagree and when asked I back my assertions when asked?
I must say, the paranoia surrounding paid for posting pundits here is rather hilarious. Just out of curiousity, do people actually make a living arguing politics on blogs like this? If so, where do I sign up?
I must say, the paranoia surrounding paid for posting pundits here is rather hilarious.
Come to think of it, you, Ryan, do seem to have an agenda more than most. Fine.
You MSM/liberal/progressives are hillarious. You make a big deal out of nothing and then accept things that ought to be questioned.
Why was the embassy so unprotected on 9/11?
Why was the security service understaffed?
How often does Obama attend his intelligence meetings?
http://www.theblaze.com/stories/obama-skipping-staggering-amount-of-daily-intelligence-meetings/
When is the last time he was present at his intelligence meetings?
Could it be possible that President Obama thinks his charm can prevent these attacks from occurring?
The time has come where he can no longer blame Bush for these problems. These problems are a part of the big, old dangerous world. He needs to start acting like a President instead of the neighborhood organizer that he is. The USA is a target where ever we go and I wish that we would just bring them all home.
Any what do some of you think? Anytime someone has an opinion different than yours, you say, “they’re a troll or they’re on the payroll for Romney.” Do you realize that once you sink to that level you have lost the argument?
You are a hillarious bunch, that’s for sure. So Romney, when will I get my check???
You make a big deal out of nothing and then accept things that ought to be questioned.
Are you an idiot?
I got to give it to the Bernanke…
Talking about QE, you never know how big or when. When the announcement is made and the size and duration are known, the bullet is fired and then everyone knows the gun is empty.
QE-infinity let’s him eat his cake and have it to.
I’m buying from now until….
“I got to give it to the Bernanke…”
What the Lou Groza Award?
The Lou Groza Award is presented annually to the top college football placekicker in the United States by the Palm Beach County Sports Commission. The award is named after former Ohio State Buckeyes and Cleveland Browns player Lou Groza.
1992 Joe Allison Memphis
1993 Judd Davis Florida
1994 Steve McLaughlin Arizona
1995 Michael Reeder TCU
1996 Marc Primanti North Carolina State
1997 Martín Gramática Kansas State
1998 Sebastian Janikowski FSU
1999 Sebastian Janikowski FSU
2000 Jonathan Ruffin Cincinnati
2001 Seth Marler Tulane
2002 Nate Kaeding Iowa
2003 Jonathan Nichols Ole Miss
2004 Mike Nugent Ohio State
2005 Alexis Serna Oregon State
2006 Art Carmody Louisville
2007 Thomas Weber Arizona State
2008 Graham Gano FSU
2009 Kai Forbath UCLA
2010 Dan Bailey Oklahoma State
2011 Randy Bullock Texas A&M
2012 Ben Bernanke Princeton
2013 Ben Bernanke Princeton
2014 Ben Bernanke Princeton
2015 Ben Bernanke Princeton
2016 Ben Bernanke Princeton
2017 Ben Bernanke Princeton
To infinity
This is the kind of thing that could trigger hyperinflation. It’s only that tiny number of $40bn that’s holding things back.
Hyper-inflation requires a feedback loop between rising prices and rising wages.
I do not see how we get wage increases when everything is imported, unemployment is so tight, and everyone is still focused on increasing corporate profits to support the new stock bubble.
To get inflation, we need to get money into the hands of spenders faster than it leaks out…. It is leaking out at $1.3T a year. Any increase of money going to the spenders immediately explodes the rate of leakage.
“” I do not see how we get wage increases when everything is imported, “”
There is some increase in free income by lowering monthly payments and people who buy and pay less per month than when renting. This is offset by higher food and fuel prices and lower earnings on savings. The effects of the former are limited to the small percentage that refi while the bottom 99% suffer from the higher food and lower returns on savings. Of course if we buy less from China this may decrease demand for natural resources and keep food prices in check. ?
“Hyper-inflation requires a feedback loop between rising prices and rising wages.”
Would you go to work if your pay of $10/hour would only buy you a litre of gas? In a hyper-inflationary environment employers will raise pay because absolutely no one will work for the old wage.
While I’m concerned that hyper-inflation could occur, I still consider it a low probability event. A high rate of inflation is another concern, and I believe your comment is relevant in a closed economy. In an open economy, a relative increase in real wages in other parts of the world can raise prices for local buyers without increasing wages.
The point: if you’re looking to buy grain, buy now or be priced out forever.
This is the kind of thing that could trigger hyperinflation.
Of course it can, except that the rest of the world is inflating as well. ECB and BoC are both easing. So, the question becomes, what to do when cash everywhere is losing value? Hard assets people, and yes, that means real estate, cash-flowing real estate…
So, the question becomes, what to do when cash everywhere is losing value? Hard assets people, and yes, that means real estate, cash-flowing real estate…
That’s what I saw when I lived in high inflation Mexico. No one wanted to hang onto cash. If you had a windfall, you immediately converted it into some sort of highly liquid asset. In some cases you would just buy whatever you could. I recall once that a friend blew a wad on several tons of rebar, which he was later able to sell at a handsome profit.
My dad had an injection molding business in Mexico City. One year the biz qualified for a heavily subsidized government loan. He used the money to buy a few semis full of imported granular polystyrene and polyethylene (I had never seen so many bags of raw plastic), which he slowly sold off at a handsome profit (and used some of it too for his business).
A friend of mine in college was from Bulgaria and her father was in Bulgaria at the time. Inflation there was massive while we were in school.
She recounted to me how angry her dad was one Friday because he didn’t get to the bank in time to convert his paycheck (which was in the local Bulgarian currency) to a more stable currency before the weekend. By Monday, he lost significant value by simply holding cash. This was 1996/1997–brutal inflation…
In the race to the bottom (in the currency markets), my REIT holdings are doing quite well. I’m focused on trade-related and warehousing industrial as well as neighborhood/grocery and discount retail, that should do OK even in a sluggish economy. If people are tight on money, they’ll buy their baby clothes at WalMart, not the mall. Even with online retailing, those goods need to be housed somewhere for a time.
Most of the REITs have already reduced debt levels to more sustainable levels, and now are in the process of fixing their interest rates and extending duration of debt, so even when rates do rise (and they eventually will). The most recent financing announced by one of the REITs I hold was for 10-years, just a shade over 4%, fixed. The pain of rising rates will be spread over a long period of time, and not all of a sudden, as it would have been with their balance sheets as they were in 2007.
AMES, Iowa (AP) — A Republican appointed to the Electoral College, Melinda Wadsley was expected to cast her vote for Mitt ***
Wadsley decided Thursday she couldn’t in good conscience vote for Romney — she had backed Ron Paul during the GOP primary — and resigned to allow the Iowa GOP to choose someone else for that duty.
“I have always been a straight-ticket Republican, and for the first time in my life I am an undecided voter, ***
Wadsley was one of three electors featured in an AP story published early Thursday that noted some GOP electors were unsure they would vote for Romney
They had expressed frustration at how Republican leaders have worked to suppress Paul’s conservative movement and his legion of loyal supporters.
“They’ve never given Ron Paul a fair shot, and I’m disgusted with that,” Wadsley told the AP for the story that preceded her resignation. “I’d like to show them how disgusted I am.”
They had expressed frustration at how Republican leaders have worked to suppress Paul’s conservative movement and his legion of loyal supporters.
You can thank that Karl “Pig” Rove for this.
Ha-ha, I’m gonna love watching his “strategery” backfire.
You can thank that Karl “Pig” Rove for this.
Screw Rove. The Fundies and the Neocons have poisoned the well for Republicans and can go pound sand. I can live with Romney over Obama, but it’s Republicans like Scott Brown and Rand Paul that get my support.
Again Roves plan is Bush III in 2016 and perpetuating the current rule of the elites that send him 10’s of millions of dollars.
i would vote for hillary over bush III…for spite.
I’m not sure the world is ready for another Bush…
Of course, I’m not sure the world is ready for another Clinton either, unless it was Slick Willy at the helm…
Jeb’s chances were forever blown with the election of GW. He was
“supposed” to be the GOP’s nominee in 2000, but four out of five members of his immediate family have arrest records for everything from customs perfidy to public fornication.
Not so great for the “values voters” bloc.
he should switch parties and change his name to kennedy.
Teddy was unelectable to the Presidency.
Took a day off today.
Why are there so many radio shows on TV these days?
Because that’s where the money is. You can charge much higher rates for TV ads than you can for radio.
…and you can’t beat the cross-marketing saturation.
Becuz us rednecks cain’t read?
Signing the mortgage paperwork yesterday, the escrow agent mentions the rate of debt right off being astounding. Her office, 8 escrow agents, closing a couple transactions a day each, were seeing more than $1 million a day, 5 days a week, being wiped out via short sale. How can the banks afford it.
My response was, $1T in credit card debt outstanding, averaging 10%, that is $100B a year. That equates to $385 MILLION per working day.
That is just the outstanding balance. They skim about 2% off the $2T in annual credit card and debt card transactions = $40B.
Now add in another 5% on $1T in student loan debt.
2% on $1T in government debt….
And, since they are borrowing at virtually 0%… their profit margin on those loans is HUGE.
Not to mention… most of the debt is not eaten by the banks. Most is passed on the Fannie, Freddie, PME or MBS holders.
“How can the banks afford it.”
They have suckers like you repaying $2 for every dollar borrowed.
Actually, assuming I do not repay early, it is more like paying back $1.25 for every $1 borrowed.
Or, more specifically, $40K for $30K borrowed, and that does not calculate potential declining value of the money that I will be repaying with.
Before calling me a liar, you may want to get your data straight.
http://www.bankrate.com/calculators/mortgages/mortgage-calculator.aspx
$30K, 4.125%, 15 years, PI = $223.79 a month
$223.79×180 = $40,282.20
Darn that math.
Debt junkies finance for life.
Darn that reality.
lol… right off…. Clearly I meant write off.
“Not to mention… most of the debt is not eaten by the banks. Most is passed on the Fannie, Freddie, PME or MBS holders.”
That’s what I don’t understand, I’m signing a new 30-year jumbo on Monday, fixed at sub-4%…I don’t understand why a bank does this when they know they can’t pass it on to Fannie/Freddie.
I don’t understand why a bank does this
Year end bonus?
I think they’re trying to get more of my business (sell me other “product”).
This should bring back the retail investors….
http://www.azcentral.com/business/articles/20120914PNI0914-biz-nyse-sec-fine.html
“he Securities and Exchange Commission on Friday charged the New York Stock Exchange for giving some customers a jump start on key market data.
The NYSE agreed to a $5 million fine.
The stock exchange allegedly sent important market data and stock quotes to some customers before sharing it with the public in the ‘consolidated feeds.’”
I am loving this Drone Attack blowbacks in the ME. Burn baby, burn…..
We kill their innocents and they will keep silent, right?
I don’t see the connection between drone attacks and the rioting… I do see a connection between Muslim extremists and a POS film funded and produced by Jewish interests insulting Mohammed. I also see Muslim extremists using this as an excuse to get unemployed and disenfranchised youth protesting the West and rioting…
‘I don’t see the connection between drone attacks and the rioting’
‘During George “Dubya” Bush’s “war on terra”, the Forces of Good in Afghanistan captured - and duly tortured - one evil terrorist, Abu Yahya al-Libi. Abu Yahya al-Libi was, of course, Libyan. He slaved three years in the bowels of Bagram prison near Kabul, but somehow managed to escape that supposedly impregnable fortress in July 2005. At the time, the Forces of Good were merrily in bed with Colonel Muammar Gaddafi in Libya.’
‘But, then, in 2011, the Forces of Good, under new administration, decided it was time to bury the oh so passe “war on terra” and dance to a new, more popular groove; humanitarian intervention, also characterized as “kinetic military action”. So al-Libi was back from the dead - now fighting side by side with the Forces of Good to topple (and eventually snuff out) “evil” Col Gaddafi. Al-Libi had become a “freedom fighter”
‘The honeymoon didn’t last long. In September 2012, for the first time in three months, al-Qaeda leader Ayman al-Zawahiri, aka The Surgeon, released a 42-minute video special to “celebrate” the 11th anniversary of 9/11, finally admitting the snuffing out of his number two.’
‘His number two was none other than Abu Yahya al-Libi - targeted by one of US President Barack Obama’s cherished drones in Waziristan on June 4.’
‘An immediate effect of al-Zawahiri’s video was that an angry armed mob, led by Islamist outfit Ansar al Sharia, set fire to the US consulate in Benghazi.’
http://www.atimes.com/atimes/Global_Economy/NI14Dj01.html
So Al Qaeda is using propaganda of the death of a highly placed leader by drone strike to spur continued violence that the US mainstream media touts as “outrage over a US-made video slamming Islam”, while conducting attacks against our embassies.
Sounds like Al Qaeda is up to its usual tricks…
‘the US mainstream media touts as…’
Why isn’t the US media talking about this video? Does it bring up inconvenient subjects like blow back from assassinations? Or that the US is, once again, actually working with Al Qaeda?
‘Al Qaeda is up to its usual tricks’
Again, Al Qaeda works with the US govt. Have for decades. Are side by side in a Syrian civil war as we type.
“…Jewish interests insulting Mohammed….”
Coptic Xtian, actually. And the State Department has intimated the protests were used as cover for (on 9-11, get it?) attacks by Al Queda.
I posted a link to and parts of the USA Today story above. Don’t expect Northeastener to care much about the facts, though.
Right intent, wrong filters. But I keep hoping, P.
Derangement syndrome. He actually has a mild case. Someone in Kansas tried to file a complaint with the Sec of State there to get the president’s name off the ballot as not being a natural born citizen. Those are the people with bad cases. They trace it to some random words in an old Supreme Court case that they claim means that “natural born citizen” means your father has to be a citizen or you are some other kind of citizen but not natural born. It was withdrawn because he didn’t like the people who called him a nut for filing the petition.
“We kill their innocents and they will keep silent, right?”
Bombing people into freedom seems like the logical thing to do.
Using currency is the fastest and easiest way to get what you need. I’d say most people place a high value on having routine, necessary tasks be as fast and as easy as possible. Leaving them with more time to pursue their own interests. Thus they very naturally gravitate to that which is faster and easier. Hence the durability of the logical construct that is currency. People naturally gravitate towards it.
If the individual has a general agreement with the value of currency, he’ll use it. The shared societal logical construct will remain viable.
However, if it becomes too difficult to obtain sufficient currency for your living needs, or if the currency is rapidly depreciating, that’s when the currency logical construct breaks down.
What all this comes down to is price stability. If the Fed engages in all its unprecedented hijinks and shenanigans, and it doesn’t affect the price stability faced by the individual, he’ll hardly notice.
IF on the other hand, price stability is damaged, i.e. there is inflation in his necessities, he will sit up and take notice.
Which brings me to my second point - the Fed’s gauge of inflation. Food, shelter, clothing, energy, medical care, education - all have gone up dramatically. I’d call the prices of this basket of goods “De Facto Inflation.” The Fed monitors inflation to measure the health of the currency. Their indicators are not showing inflation in the currency, yet are not accurately capturing the DE FACTO price increases faced by consumers. Food and clothing may be influenced by the increased amount of money injected into the economy.
I’m thinking that the surge into the market of developing country labor, plus their use in manufacturing, has suppressed the prices of manufactured goods. Hence the cheap iPads. Market distortions have hiked shelter, energy, medical care and education. So, currency inflation indicators remain muted.
HOWEVER - it all comes down to what the individual member of society is feeling. The net result is that the necessities are all going up, regularly. The Fed presses ahead with its advertised 2% inflation target year in year out. Which doesn’t accurately capture the actual price increases faced by the end user.
De facto inflation versus official inflation. It’s the de facto inflation / price increases to which the consumer responds. They don’t care about the official number. They care about what’s going on in their daily lives.
I suspect that if the actual current price increases faced by the individual were caused by currency inflation only, it would have the undivided attention of politicians and the Fed.
Here’s our own blog debt junkies…. lmao
http://imageshack.us/a/img688/2484/40973600.jpg
Ha ha. Good one. Where’s the one with the infestors like Rental pimp and Jingleball?
Thanks. I’m feeling better now. Attitude on the upturn!
Presidents live in a bubble. They get their information from advisors. Plus they have their own personal experience to rely on. Here’s a glimpse into Romney’s outlook.
Romney: ‘Middle-income’ is $200K to $250K and less
By STEVE PEOPLES, Associated Press – 2 hours ago
“Is $100,000 middle income?” Stephanopoulos asked.
“No, middle income is $200,000 to $250,000 and less,” Romney responded.
His campaign later clarified that Romney was referencing household income, not individual income.
The Census Bureau reported this week that the median household income — the midpoint for the nation — is just over $50,000.
http://www.google.com/hostednews/ap/article/ALeqM5hT1nGNyd4JyixXboBO_c3Pvfj7yQ?docId=b1d66e74fd9947c59bb49883826cfe9d
Should be an interesting November. It’s not clear to me that the politicians really have a clear picture of what’s going on in the nation as a whole. One of the reasons CEOs and top managers get paid so much is their ability to look at a vast sea of information and pull out the important ones and figure out how to change them. Is this Romney’s ability to look at a sea of information and pull out salient details?
So, is Romney saying household incomes with 250k and above rich? That’s the same policy as Obama IIRC.
It’s better than McCain’s metric, who thought that “middle class” ended at $1 million/year.
But I don’t see how it matter where Romney draws his line, since he’s is not using it to delineate where to cut/raise taxes.
It is just another reference point on the “does this guy understand me” scale. Anyone who thinks you need $200K a year to be middle class is living in a different world than most of the country.
Oh, well if it’s “household” income that’s a different story….
Mr. Romney might do well to have a good long convo with his relief driver some day.
“Comment by Rental Watch
2012-09-14 09:16:07
Inflation was up 0.6% on the month…announced this morning.
Inflation - Up (and recorded)”
This was August numbers, and far more likely the result of a hurricane shutting down gulf oil production than QE-Infinity being announced a month after the fact.
Yes, but QE1 and 2 have been ongoing…
I’m always amused at the inflation numbers sans “volatile food and energy”. Like I care about how much a new car stickers for or how much a new iPhone costs.
I do care how much I pay for petrol, NG, electric, milk, cheese, chicken, turkey, bread, etc. I buy food and energy every day, not so much with clothes, cars, and electronics.
I know. If the PTB wanted to take out the volatility related to food and energy prices, it would be easy.
Simply use a ___ year moving average for those prices.
3 year should be more than enough to take out the effect of a hurricane in one year. It may even be too long…2 year moving average?
The other thing rarely mentioned [I wonder why] is the producer price index. That was up well over 1.7% in August. Sometimes it’s not about what we pay [sans certain necessities]. Sometimes it’s about what companies pay for raw materials and will eventually be passed onto consumers…
The whole housing market really is a government-driven beast.
DeMarco also discussed the FHFA’s Aug. 31 announcement that it directed Fannie and Freddie to raise the guarantee fees they charge on single-family mortgages by an average of 10 basis points. He reiterated that the move was to bring pricing closer to the level one might expect to see if mortgage credit risk was borne solely by private capital.
He pointed out that nine out of 10 mortgages are backed by the federal government, which means taxpayers are accountable for 90 percent of U.S. mortgages.
http://www.nafcu.org/News/2012_News/September/FHFA_developing_new_securitization_platform/
Posted: 4:02 p.m. Friday, Sept. 14, 2012
1.8M Ohio public pensioners to see changes
By JULIE CARR SMYTH
The Associated Press
COLUMBUS, Ohio —
Big changes are ahead for nearly 1.8 million workers, retirees and family members covered by Ohio’s five public pension funds.
State lawmakers cleared a package of bills this week aimed at shoring up the systems’ finances and keeping them solvent. The result is adjustments to benefits, premiums and eligibility requirements, including in some cases the age and service levels at which participants will be eligible to retire.
Allowances for cost-of-living increases and the way the salary average for determining benefits is calculated are among other areas where legislation makes adjustments.
Here’s a look at some of the basic changes to the rules and what those will mean for participants.
OHIO POLICE AND FIRE PENSION FUND
Q: Will my contribution rate go up?
A: Yes. The current rate of 10 percent will rise in July in each of the next three years, to 10.75 percent, 11.5 percent, then 12.25 percent.
Q: Will my age of retirement change?
A: Requirements for normal retirement remain the same for current active members, which is at age 48 with 25 years of service. The new law would affect members hired after July 1, 2013. At that point, the requirement is age 52 with 25 years of service. Reduced benefits would still be available at age 48 with 25 years of service.
Q: How will benefit payments change?
A: The cost of living adjustments on pension benefits will change. The amount of the adjustment will change when active members with less than 15 years of service as of July 1, 2013, retire. Instead of 3 percent of their base pension amount, it will be the lesser of 3 percent or the Consumer Price Index. For current retirees and active members with 15 years or more of service, the adjustment remains 3 percent. Also, cost-of-living adjustments for all members will be delayed until age 55, except for survivors and those who receive permanent and total disability benefits.
Q: Will there be changes to how my benefits are calculated?
A: Yes. For those with less than 15 years of service on July 2, 2013, the average annual salary on which benefits are based will come from the average of the highest five years rather than the average of the highest three.
SCHOOL EMPLOYEES RETIREMENT SYSTEM
Q: Will my contribution rate go up?
A: No.
Q: Will my age of retirement change?
A: Eligibility requirements don’t change for those who have 25 years of service on or before Aug. 1, 2017. For everyone else who retires after Aug. 1, 2017, eligibility for full benefits changes to age 67 with 10 years or age 57 with 30 years. Eligibility for early retirement changes to age 62 with 10 years or age 60 with 25 years.
Q: How will benefit payments change?
A: Early retirement benefits will be reduced based on age and service. For those with 25 or more years of service, minimum guarantees are in place.
Q: Will there be changes to the way my benefit level is determined?
A: No.
STATE TEACHERS RETIREMENT SYSTEM
Q: Will my contribution rate go up?
A: Yes. The current rate of 10 percent will rise to 11 percent on July 1; to 12 percent on July 1, 2014; to 13 percent on July 1, 2015; and to 14 percent on July 1, 2015.
Q: Will my age of retirement change?
A: Eligibility remains the same for those who are 65 or older with five years of service. The years of service required to retire earlier than that will rise from the current 30 years beginning Aug. 1, 2015, to 31 years until Aug. 1, 2017; to 32 years until Aug. 1, 2019; to 33 years until Aug. 1, 2021; to 34 years until Aug. 1, 2023; to 35 years until Aug. 1, 2026. From then on, 30 years of service and age 60 will be required to receive full benefits. A similar phase-in will take place for reduced benefits.
Q: How will benefit payments change?
A: There will be no change for those who retire before Aug. 1, 2015, or meet current eligibility requirements before July 1, 2015. All others will receive 2.2 percent of their final average salary for each year of service, including years above 30 that yield more under the current system.
Q: Are there changes to the way my benefit level will be determined?
A: Yes. After Aug. 1, 2015, the salary average used to calculate benefits will be based on your five highest years of compensation rather than your highest three.
Update from the “terrorist threat” in Kansas City…….
Seems that a person of Middle Eastern descent goes in the Federal Building, asks “Why am I on the Terrorist Watch List??”
All the Feds hear is “terrorist”. Go bat-$hit crazy, close down the building, evacuate three block radius, bomb sniffing dogs “indicate” explosives inside the vehicle, robots tear apart the car, helicopters, probably a drone or two.
Seems that the guy is in the Witness Protection Program, for testifying in the first WTC bombing trial.
Found out he was on the terror watch list, when the KC Chiefs wouldn’t renew his season tickets, because he was a “threat”.
At least that’s the story so far.
I wonder how many terrorists are on the “do not watch list?”
Obama’s interview with ‘Pimp with the Limp’
“You’re big time. You’ve got Pitbull and Flo Rida and all these guys just beating a path to your door,” Obama said, buttering up Laz. “And so I’m hoping that I can get a little of that magic from you in this interview.”
http://capitalistpreservation.blogspot.com/2012/09/obamas-interview-with-pimp-with-limp.html - 116k -
Updated: 6:05 p.m. Friday, Sept. 14, 2012 | Posted: 6:05 p.m. Friday, Sept. 14, 2012
Fed seeking to create wealth, not just cut rates
By MARTIN CRUTSINGER
The Associated Press
WASHINGTON —
The Federal Reserve wasn’t just trying to drive down interest rates when it announced a third round of bond purchases Thursday.
It also wants to make people feel wealthier — and more willing to spend.
The idea is for the Fed’s $40 billion-a-month in bond purchases to lower interest rates and cause stock and home prices to rise, creating a “wealth effect” that would boost the economy.
And “if people feel that their financial situation is better because their 401(k) looks better or for whatever reason — their house is worth more — they’re more willing to go out and spend,” Chairman Ben Bernanke told reporters. “That’s going to provide the demand that firms need in order to be willing to hire and to invest.”
Sure enough, stocks have surged since the Fed announced plans to buy mortgage bonds as long as it feels necessary — a policy known as “quantitative easing,” or QE. And since Bernanke gave a speech Aug. 31 more or less confirming that QE3 was on the way, the Dow Jones industrial average has jumped more than 500 points, about 4 percent.
In addition to the bond purchases, the Fed said it expects to keep short-term rates super-low at least through mid-2015, six months longer than it previously planned. And it said it would probably hold rates low even after the economic recovery has strengthened — a sign that it will intervene until the economy starts growing fast enough to reduce unemployment sharply.
As a result of the Fed’s latest moves, Mark Zandi, chief economist at Moody’s Analytics, expects the average rate on a 30-year fixed mortgage to fall in the next several months to near 3 percent from 3.55 percent now. Lower rates could trigger another wave of refinancing, which would give people more money to spend.
If lower mortgage rates boost home sales and prices, they could contribute to the wealth effect: Americans whose homes rise in value would be more willing to spend.
The combination of more refinancings and increased household wealth will help the economy quickly but only modestly, Zandi predicts. The Fed’s moves should lower unemployment (8.1 percent in August) by up to 0.3 percentage point by the end of 2013, he says.
Many economists worry that the Fed is reaching a point of diminishing returns after nearly four years of aggressive efforts to help the economy. Bernanke himself urged everyone to keep expectations in check.
“I personally don’t think that it’s going to solve the problem,” he said Thursday. “But I do think it has enough force to help nudge the economy in the right direction.”
Every $1 increase in stock prices raises consumer spending by 3 cents to 5 cents, according to calculations by Joseph Gagnon, a former Fed official who’s a senior fellow at the Peterson Institute for International Economics. So if the market value of the Standard & Poor’s 500 stock index, which was $13.9 trillion Friday, rose 10 percent, consumer spending would rise $40 billion to $70 billion.
And “if people feel that their financial situation is better because their 401(k) looks better or for whatever reason — their house is worth more — they’re more willing to go out and spend,” Chairman Ben Bernanke told reporters.
Doesn’t hair color do the same thing, make a borrower feel younger, able to take on some debt because they’ll live longer?
Posted: 6:57 p.m. Friday, Sept. 14, 2012
Police: Man called 911 more than 15 times because clerk wouldn’t sell him beer
By Julius Whigham II
Palm Beach Post Staff Writer
GREENACRES —
A suburban Lake Worth man who really wanted beer was arrested Monday for misuse of the 911 system, city police said.
When a convenience store clerk refused service to Johnny Ramos when he tried to purchase beer Monday, he threatened to call police. Instead, Ramos, 41, ended up spending part of his day in jail.
He is facing charges of misuse of 911 and disorderly intoxication after he called 911 more than 15 times, according to a police arrest report.
He was booked into the Palm Beach County Jail Monday and later released on his own recognizance.
According to the report, Ramos went to the Cumberland Farms in the 6700 block of Lake Worth Road at about 10:30 a.m. Monday to buy beer.
The clerk told officers that she refused the sale because Ramos was heavily intoxicated. Ramos yelled at the clerk and told her that he was calling the police, the report said.
Offiers later found him outside of the store. Before the officers arrived, they were informed by dispatchers that Ramos had called 911 more than 15 times that day, and more than 20 times the day before.
The dispatchers reported that Ramos yelled and spoke incoherently when asked to describe his emergency. At one point, a dispatcher called him back to verify whether there was an emergency. Ramos then stated that he would continue to call and did not care if he was arrested, the report said.
Eh, we’ve all been there.
For anyone on the fence about who to vote for this may Sinch it.
“As for Mitt Romney, he followed in the footsteps of his former rival John McCain and admitted he likes Nicole “Snooki” Polizzi on MTV’s “Jersey Shore.”
McCaine and Romney watching Snooki on TV. Wow I have to go wash my brain.