Linking ≠ endorsement.
↑ Angry Bear – Protesting Madame Lagarde (what is the IMF doing now?)
The protests at Smith College that led to the withdrawal of Christine Lagarde, Managing Director of the International Monetary Fund, as this year's commencement speaker have been widely denounced as a manifestation of intolerance. They also demonstrate a lack of understanding of the IMF and the many changes that have taken place at that institution in the last decade, as well as Ms. Lagarde's own record. The IMF adjusted its policies in response to the criticisms it received after the crises of the 1990s, but apparently its critics are mired in the past.
It's either that or they are much further left than Joseph realizes.
Given Christine Lagarde's speeches and actions, some of which we've covered via this blog, we were rather surprised by the protest.
↑ The Share of Borrowers with High Student Loan Balances Is Rising | St. Louis Fed On the Economy
Alexander Monge-Naranjo, research officer and economist with the Federal Reserve Bank of St. Louis, examined the recent growth in student loan debt in the U.S. over the period 2005-2012. As of March 2012, student loan debt stood at $870 billion and had surpassed total credit card debt ($693 billion) and total auto loan debt ($730 billion).
In addition, Monge-Naranjo found that the distribution of student loans by debt levels had shifted, with the share of borrowers with loan balances in excess of $10,000 increasing.
As we've said before, we think saddling the young with student loans is one of the dumbest things this country has done. College should be free for all who can do the work.
↑ Ricardo Hausmann examines a source of capital accumulation that experts on inequality have overlooked. – Project Syndicate
Interesting: Ricardo Hausmann:
… America's net borrowing of $13 trillion dramatically understates the extent of gross borrowing, which was more like $25 trillion in gross terms. The US used $13 trillion to cover its deficit and the rest to invest abroad.
This money is mixed with knowhow as foreign direct investment, and the return to both is more like 9%, compared to the 4% or less paid to lenders.
However, we don't think that necessarily negates Thomas Piketty's thesis, unless one takes it that Thomas Piketty rejects that there are higher-than-average returns on some investments. It might show that Thomas has used an average that is too low, but we'd have to see more data on it to know.
We can show where some rich American's have lost money. That doesn't prove Piketty wrong either.
↑ Zillow: Sellers still in the driver's seat | Fox Business Video
Zillow chief economist Stan Humphries weighs in on the U.S. real-estate market.
↑ Lower rates fail to boost mortgage activity
Month to month, April housing starts rose 13 percent, but CNBC's Diana Olick reports investors need to look at the jump in multi-family data.
↑ [Highly recommended] Parsing Piketty: Is Wealth Inequality Rising in the U.S.? : The New Yorker
An innovative new study by Saez and Gabriel Zucman, also of Berkeley, says that the wealth share of the top 0.1 per cent of households—the very, very rich—has risen sharply and consistently since the mid-seventies. The chart below, which shows the rising trend, is from a presentation by Saez and Zucman. At the very top of the distribution, the two authors conclude, the United States is "back to early 20th century wealth concentration levels."
… as far as the United States goes, the concerns that Giles [Chris Giles, Economics Editor, Financial Times.] raises don't knock down the Piketty thesis.
↑ Confounded Interest | Detroit's Plan To Destroy 25% Of Its Homes At Taxpayer Expense (Of Course)
According to the Christian Science Monitor, the Detroit population has declined so dramatically that the city has been left with a vast number of blighted properties. A new $850 million plan would destroy about 85,000 of them. Addressing the larger-scale commercial sites across the city could add an additional $500 million to $1 billion because of their much larger size and their potential for greater environmental issues.
Here is Detroit's Blight Removal Task Force Plan.
Here is a map of where the high priority teardowns will occur.
↑ Commercial real estate improves, but economic recovery disappoints | Realuoso
Dr. Lawrence Yun, NAR chief economist, said the sluggish growth experienced in the first quarter is not indicative of the actual health of the economy. "Gross Domestic Product should expand closer to 3 percent for the remainder of the year. The improved lending for commercial loans and continuing job gains we've seen this spring bode well for modest progress in commercial real estate leases and purchases of properties."
Dr. Yun cautions that with rising long-term interest rates on the horizon, consistent economic growth is imperative to solid commercial real estate investment in the years ahead.
We think he's still too optimistic.
The NAR wants its economic forecasting to be as forward guidance from the Fed.
They just can't psych people out of debt though or psych them into conjuring up a down payment and good-paying job.
↑  Mish Shedlock on Fed Reserve & Rate Hikes & Marshall Auerback on Euro Recovery – YouTube
Particularly recommended segment at 14:31:
Erin brings you her interview with Marshall Auerback who discusses Europe's so-called competitiveness problem, the European Central Bank, and the need for credit writedowns in Europe.
↑ The growing wealth divide in the U.S. housing market | Daily Ticker – Yahoo Finance
Lisa Sturtevant, vice president for research at that National Housing Conference, a nonprofit focused on affordable housing for all Americans, explains what's been happening: "A tighter mortgage market is making it increasingly difficult for middle class folks to get home loans, which is pushing a whole group of folks into the renter side, which increases demand on that side and pushes up rents."
The video on the post is a pretty standard overview of what's happening.
↑ Boyle Heights real estate flier stokes gentrification fears | Multi-American | 89.3 KPCC
A real estate flier touting the relative affordability of Boyle Heights sparked online outrage among Angelenos concerned about gentrification.
"Why rent downtown when you could own in Boyle Heights?"
↑ Are Americans Shut Out of the New Housing Market?: Video – Bloomberg
Jonathan Miller, president and Chief Executive Officer at Miller Samuel, and John Melloy, Chief Executive Officer at StockTwits, examine the changing housing market in the United States. They speak on Bloomberg Television's "Bloomberg Surveillance."
↑ Help to Buy: New figures released | Global Briefing
Gráinne Gilmore, Head of UK residential research at Knight Frank, said: "The take-up rate for the Help to Buy mortgage guarantee suggests that fears that it is stoking house prices have so far been misplaced. House prices have been underpinned by rising demand amid limited supply, and the Help to Buy mortgage guarantee is at this stage only a side-show to this fundamental problem.
↑ Redfin hires Bloomberg vet Nela Richardson as first chief economist | Inman News
Redfin has hired Bloomberg LP vet Nela Richardson as its first chief economist, helping the Seattle-based brokerage and referral site take another step toward the national spotlight.
↑ [The hottest debate in economics right now] Follow up on problems in 'Capital in the 21st Century' | Money Supply
A reasonable and reasoned reply by Chris Giles concerning Thomas Piketty's book?:
There is no doubt that the data the FT has questioned relate to just six charts in Prof Piketty's book, not his theory, nor his numbers on income distribution. Many others have commented on those.
My point is that if someone is claiming to have found a fundamental contradiction of capitalism, predicts the result is a rising share of wealth inequality, and uses apparent recent rises in recent wealth inequality as evidence that his theory is correct, those data lie at the core of the book's argument.
Without the rising wealth inequality data across all advanced economies, I would submit that Prof Piketty has a theory without all the necessary evidence.
We are leaning in Chris's direction concerning the possible overuse of averaging over long periods based upon very few data points.
We are glad to see that Chris Giles included a link to John Cassidy's post, which we had read earlier and to which we too have linked above.
It will be highly interesting to see Thomas Piketty's full response and to learn what's in the addendum update to his book.
We nevertheless remain fully confident that his general theory is correct.
↑ The Great Recession's "biggest policy mistake" – CBS News
The government's response was to institute programs such as TARP that helped to restore the balance sheets of financial institutions, and these programs were very successful. Banks had a tough time to be sure, but the bailout worked, and today the banking sector has largely recovered from its ills.
Unfortunately, households didn't get the same amount of help in large part due to the opposition of Geithner's Treasury. That's why I concur with Mian and Sufi that this is "the biggest policy mistake of the Great Recession." A policy that would have provided households with mortgage debt relief could have made a big difference to those trying to rebuild their balance sheets and eliminate debt.
But households didn't get the kind of attention that big banks got. Instead, Americans were forced to mostly rebuild on their own, and this is a primary cause of the ongoing, slow recovery.
We think Wall Street should have been nationalized the way AIG was.
We also think many homebuyers deliberately lied to get loans they couldn't afford but were depending upon continuing price appreciation and refinancing to get through, which could never work. They should not be rewarded but should not be left on the streets either.
The proper response to the Great Recession would have been massive public spending on jobs (public and private) for infrastructure, etc., and the federal government doing much more to shore up state and local governmental services (paid for via debt-free currency, not bonds)!
↑ Central Ohio home prices surged 16 percent in April | The Columbus Dispatch
Home prices in the Columbus area shot up 16 percent in April over the previous April, well above the national average of 11 percent, according to a monthly report from the real-estate information service RealtyTrac.
↑ Pending U.S. home sales rise in April, but pace slows – Newsday
Housing demand has cooled as higher prices and borrowing costs put ownership out of reach for some prospective buyers. While mortgage rates have been falling in recent weeks, an improving employment outlook and easier access to credit would provide an additional push for the industry.
Homebuilding subtracted 0.16 percentage point from gross domestic product in the first quarter after a 0.26 percentage- point hit in the final three months of 2013, figures from the Commerce Department showed today. The economy shrank 1 percent last quarter, the first contraction in three years.
Federal Reserve Chair Janet Yellen has flagged housing as a risk to the economy ….
↑ [Very highly recommended] Thomas Piketty Responds to Criticism of His Data – NYTimes.com
Thomas Piketty responds:
The short version: He doesn't give an inch.
"My problem with the FT criticisms is twofold," he wrote, in a 4,400-word response on his website. "The FT suggests that I made mistakes and errors in my computations, which is simply wrong, as I show below. The corrections proposed by The FT to my series (and with which I disagree) are for the most part relatively minor, and do not affect the long run evolutions and my overall analysis, contrarily to what The FT suggests."
And those arguments by the newspaper that are not so minor and do undermine his findings, he writes, "are based upon methodological choices that are quite debatable (to say the least)."
He has reasonable answers for why the supposed "discrepancies" with Chris Giles' findings and why the perhaps sweeping generalizations with some of the data.
↑ Cox offers details on 1 Gbps rollout–will start out in Phoenix, Las Vegas, Omaha – FierceCable
After revealing plans last month to kick off super-fast 1 Gbps Internet services, Cox Communications on Thursday revealed its roadmap for getting them launched.
The Atlanta-based pay-TV and ISP provider announced that it will immediately begin building these services into select areas of Phoenix, Las Vegas and Omaha, Neb., with nationwide rollout scheduled to be completed by 2016.
↑ Resident requests service, but technician can't find the problem | Property Management Minutes
Partnering with a maintenance technician, with service request in hand, demonstrating the difference between a well written service request is a learning experience that won't be forgotten.
In the process of preparing the service request, we confirm, permission to enter if the resident isn't home, the presence of pets in the household and how they will be secured or contained; a description of the problem and possibly getting a daytime number in case there are any questions might reduce the number of Couldn't Find A Problem service requests.
↑ BackerReport – Community Association Law Newsletter
A condominium association wanted to force bug extermination in a unit. The court found:
Given that the owner lived in the unit for several years without pest service provided by the association, and there was no evidence of a pest problem in 2009, there was a genuine issue of material fact as to the necessity of the association's actions.
That sounds logical.
↑ Should Every Apartment Community Be Active In Social Media? – Multifamily Blogs
Well said: Brent Williams:
… should a community that still has trouble with excellent maintenance or even responding to emails (which is still a common problem) be actively engaging on Facebook? Of course not. I think this idea that "every community should be active in social media" sends the message that social media is more important than a lot of the basic elements that many apartment communities still struggle with. And considering that social media is labor intensive, it can compound those problems by taking away focus from more critical elements of property management.
↑ Large real estate investor purchases steeply decline in California – OC Housing News
In the past, whenever affordability became a problem, lenders would come up with some innovative toxic loan product, allowing people to buy homes they really couldn't afford; thus the cycle of Ponzi lending and borrowing would begin. During the bubble from the late 80s, toxic products such as adjustable-rate interest-only loans became common, and prices were pushed up to the limit of fake affordability these products created. During the most recent housing bubble, we hit what should have been a peak in late 2003, but lenders "innovated" again and began originating and securitizing option ARMs that pushed prices up to ridiculous levels.
To prevent the deflation of that housing bubble, the federal reserve engineered low mortgage rates by first lowering the federal funds rate to zero then printing money to buy mortgage-backed securities to push mortgage rates down from 6.5% to 3.5%. In the process they made stupid bubble-era prices affordable – which is where we stand today.
↑ Local woman arrested for insurance fraud – NBC-2.com WBBH News for Fort Myers, Cape Coral & Naples, Florida
A Port Charlotte woman has been arrested after intentionally flooding her home and setting her kitchen on fire to collect insurance on it all, according to the Florida Department of Financial Services.
↑ Arson arrest made, insurance money collection scam | WTHITV.com
Officials say a family member of Justin Roacho asked him to set their Tabortown Road home on fire. The person allegedly told him they wanted to collect the $15,000 insurance money.
↑ Blast victim's family to receive $323,000 | Wichita Eagle
A Shawnee County judge on Tuesday approved settlements and dismissed three lawsuits linked to the blast that killed 81-year-old Lucinia Tolliver in January 2012. The blast destroyed Tolliver's home and injured a neighbor.
↑ 2 W.Va. men sentenced in Logan arson scheme – Washington Times
Two West Virginia men have been sentenced to prison terms for having a building torched in Logan and collecting a $1 million insurance settlement.
↑ Woman Accused Of Starting Fire That Killed Her Brother – CBS Houston
San Antonio police say a woman has been accused of starting her family's house on fire in an alleged insurance scam that left her brother dead and their father hurt.
↑ More Taiwanese factories report damage from Vietnam riots: MOEA | Economics | FOCUS TAIWAN – CNA ENGLISH NEWS
Taipei, May 27 (CNA) The number of Taiwanese factories reporting damage during recent anti-Chinese riots in Vietnam has increased to 358, with 21 having been set on fire, a Ministry of Economic Affairs (MOEA) official said Tuesday.
Did they know they were Taiwanese (Taiwan formerly known as Nationalist China) businesses and not mainland-Chinese businesses?
↑ At least 21 killed in hospital fire in southern S.Korea – Xinhua | English.news.cn
At least 21 people were killed and eight others injured in a fire that occurred at a sanatorium in Jangseong, some 300 kms south of the South Korean capital city of Seoul, early on Wednesday, local broadcaster YTN reported.
Firefighters said some patients had their hands tied to the sickbed, contributing to the increase in casualties, but the sanatorium denied it.
We hope they didn't tie people to the beds.
↑ Woman gets six years in Nelson County arson schemes – News – Local Lynchburg, Virginia Area – The News & Advance
James Shelton Jr. said he is relieved Nelson County will not have to worry about any fires erupting from the schemes of Linda Campbell Blackwell for the next six years while she is behind bars.
When she is released from prison, though, Shelton said he fears another fire could be sparked by her hands.
"She's done it before and she will do it again," Shelton said.
James Shelton Sr., his late father, died in August 2009 from injuries sustained in a house fire that Blackwell, 59, was accused of starting to collect insurance money.
The article makes it sound like the alleged evidence was extremely weak at best. What are we missing? Did the article leave evidence out?
↑ Weather service team to rate North Dakota tornado
The oil boom has brought tens of thousands of people into the area looking for work. Many live in hastily assembled trailer parks, known as man camps, housing pre-fabricated structures that resemble military barracks. Some companies rent blocks of hotel rooms for employees, and some workers sleep in their cars or in tents.
The camp hit by the tornado was relatively small. Samuelson said some in McKenzie County have hundreds of trailers and it's lucky that one of those wasn't hit because the possibility of injuries or damage would have been much higher.
↑ Firefighters attack blaze in dry, steep Central California foothills from the ground and air | Star Tribune
The Hunters Fire ignited Monday afternoon and destroyed three buildings as it spread to the dry brush in steep foothills. Crews had difficulty reaching it, and on Tuesday temperatures rose into the 90s with winds up to 20 mph, adding to the challenge of an already dry year.
In its third dry year, California has already had 1,700 wildfires in 2014, said Berlant, who compared that with the 900 by this time last year.
↑ Mirror that shattered onto woman in Portland yoga class spurs $455,000 lawsuit | OregonLive.com
On Thursday, Eltinge filed a $455,000 lawsuit in Multnomah County Circuit Court against CorePower and DT Glass, claiming that the heavy mirror was poorly glued onto the wall at 844 S.E. Morrison Street and lacked critical safety features such as screws or braces to keep it in place.
"They slapped a little glue on the wall and that was it," said Eltinge's Portland attorney, Sean DuBois. "No screws. No other restraining device."
↑ Cigarettes to Blame for 13 of 21 Recent Anchorage Fires | Local News – KTUU.com Anchorage
"They believe that a small pail in their backyard filled with some sand is fine. But as other materials get close to that, or a fire starts in that object itself, it does spread to the residents — that's what we've been seeing here recently," Temple said.
Temple says a good alternative to plastic bins or ashtrays is a metal container, like an empty coffee tin. He recommends filling it with water to help douse the cigarette butt.
↑ UPDATE 1-Panasonic to recall 43,000 PC batteries after three catch fire | Reuters
Panasonic Corp will recall 43,140 battery packs used in notebook computers after three incidents of the batteries overheating and catching fire, the company said on Wednesday.
Tesla uses a similar type of cell used by notebook computers, but a Panasonic representative said the batteries involved in the recall were different from those that it supplies to Tesla and so there was no impact on the automaker.
If you are an investor in 1-4 unit properties in Arizona, California, Nevada, Oregon, Utah, or Washington, please do the financially responsible thing and make sure you have proper Landlord Insurance with PropertyPak™. We love focusing on real estate and the economy in general, but we are also here to serve your insurance needs.
Hill & Usher (PropertyPak™ is a division) has many insurance offerings. See our menu above for more info and links.
Did this post help you? Let us know by leaving your comment below.
Note: This blog does not provide legal, financial, or accounting advice. Seek professional counsel.
Furthermore, we, as insurance producers, are prohibited by law from disparaging the insurance industry, carriers, other producers, etc. With that in mind, we provide links without staking out positions that violate the law. We provide them solely from a public-policy standpoint wherein we encourage our industry to be sure our profits, etc., are fair and balanced.
We do not necessarily fact checked the contents of every linked article or page, etc.
If we were to conclude any part or parts of our industry are in violation of fundamental fairness and the legal standards of a state or states, we'd address the issue through proper, legal channels. We trust you understand.
The laws that tie our tongues, so to speak, are designed to keep the public from losing confidence in the industry and the regulatory system overseeing it. Insurance commissioners around the country work very hard to analyze rates and to not allow the industry to be damaged by bad rate-settings and changes in coverages. The proper way for people in the industry to deal with such matters is by adhering to the laws, rules, and regulations of the applicable states and within industry associations where such matters may be discussed in private without giving the industry unnecessary black eyes. Ethics is very high on the list in the insurance industry, and we don't want to lose the people's trust. That said, the industry is not perfect; but what industry is?
For our part, we believe in strong regulations and strong regulators.
We welcome your comments and ask you to keep in mind that we cannot and will not reply in any way or ways where any insurance commissioner could rightly say we've violated the law of the given state.
We are allowed to share rating-bureau data/reports and industry-consultant opinions but make clear here that those opinions are theirs and do not necessarily reflect our position.