News Alerts, Sept. 15, 2013, Afternoon Edition, #RealEstate +

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  1. Sober Look: FOMC members fret over deflation risks

    The next inflation expectation numbers come out the same day as the CPI – September 17th (8:30 AM). On that same day the FOMC begins its meeting. Will the "Japan fears" dominate the debate?

    They will along with the bad employment numbers/low-participation rate.

    Read the source article … s-fret-over-deflation-risks.html

  2. Persistent Scars of Long-Term Joblessness –

    Peter Morici of the University of Maryland. "Adding in part-timers who want full-time employment and discouraged adults who have abandoned searching for jobs, the unemployment rate becomes 13.7 percent. This figure has fallen because more adults appear reconciled to permanent part-time status."

    It is the problem.

    Read the source article … 9/06/persistent-scars-of-long-term-joble ssness/?_r=0

  3. Number of the Week: Lackluster Pay Growth – Real Time Economics – WSJ

    Businesses are still reluctant to hire new workers at a pace that would support faster consumer spending. And without stronger consumer spending, it is unlikely gross domestic product growth will rev up in the second half.

    Indeed, another disappointing trend in the employment numbers was lackluster pay growth.

    The average hourly wage rose a nickel in August but stands only 2.2% above its year-ago level. Household budgets barely are keeping pace with inflation.

    Read the source article … 7/number-of-the-week-lackluster-pay-grow th/

  4. Fiscal stimulus in times of high public debt: Reconsidering multipliers and twin deficits | vox

    … while fiscal stimuli exert expansionary effects on macroeconomic activity at low debt-to-GDP ratios, the overall effect on real GDP becomes less positive or even negative points at higher debt-to-GDP ratios.

    Depending on which debt scenario we examine, our results accommodate the inconclusive results of previous studies, which either document positively correlated or divergent behaviour of government activity and the trade balance or the current account.

    In sum, our findings lead us to conclude that the contradictory findings of previous studies may be the result of estimation within a static debt regime when indeed the debt regime is dynamic.

    Read the source article … ulus-times-high-public-debt-reconsiderin g-multipliers-and-twin-deficits

  5. Financial Iceberg

    This reseach [sic] assesses the implications of Chinese capital account liberalization for capital flows. Stylized facts from capital account liberalization in advanced and large emerging market economies illustrate that capital account liberalization has historically generated large gross capital in- and outflows, but the direction of net flows has depended on many factors.

    • An econometric portfolio allocation model finds that capital controls significantly dampen cross-border portfolio asset holdings.

    • The model also suggests that capital account liberalization in China may trigger net portfolio outflows as large domestic savings seek to diversify abroad.

    It seems logical if there's much capital left after any national real estate crash. Would there be a bailout by China's central bank so that China would send new hot money abroad, as the US did after the Great Recession?

    Read the source article … account_liberalization_in_china.html

  6. Emerging Markets' Euro Nemesis by Daniel Gros – Project Syndicate

    The cause of this state of affairs, in one word, is austerity. Weak demand in Europe is the real reason why emerging markets' current accounts deteriorated (and, with the exception of China, swung into deficit).

    Thus, if anything, emerging-market leaders should have complained about European austerity, not about US quantitative easing. Fed Chairman Ben Bernanke's talk of "tapering" quantitative easing might have triggered the current bout of instability; but emerging markets' underlying vulnerability was made in Europe.

    The fickleness of capital markets poses once again the paradox of thrift. As capital withdraws from emerging markets, these countries soon will be forced to adopt their own austerity measures and run current-account surpluses, much like the eurozone periphery today. But who will then be able – and willing – to run deficits?

    Two of the world's three largest economies come to mind: China, given the strength of its balance sheet, and the eurozone, given the euro's status as a reserve currency. But both appear committed to running large surpluses (indeed, the two largest in the world). This implies that, unless the US resumes its role as consumer of last resort, the latest bout of financial-market jitters will weaken the global economy again. And any global recovery promises to be unbalanced – that is, if it materializes at all.

    Daniel makes very valid points, but we think he has, nevertheless, understated the Fed's role in this. Much of Europe bought into the toxic mortgage-backed securities from the US afterall, and the Fed holding interest rates artificially low for years under Alan Greenspan's misguided watch helped the Wall Street investment banks and others fund the mortgage brokers' heyday starting in Orange County, CA. The rest, as they say, is history (still playing out).

    Read the source article … ary/how-the-euro-is-sinking-the-emerging -economies-by-daniel-gros

  7. 3 Ways to Find Good Tenants

    Many in the United States have still not recovered fully from the shocks of the recession, mainly because it has not ended. Their savings have depleted and a lion's share of their current disposable incomes is still being channeled to repay the numerous debts that may have accumulated through these tough years. So it is only natural that many would be unable to afford or unwilling to go in for a home loan.

    On the other hand, there are many people in the country who do not want to be saddled by the hassles of owning a house especially if they intend to relocate when greener pastures beckon. Renting wins over owning and you have a great chance to make your real estate investment pay back lucrative returns. That is, if you know where to look for tenants.

    Look at wanted ads placed by tenants. Rent to Section 8 tenants. Use real estate agents to list your rental properties.

    Read the source article … -tenants/

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