News: Real Estate, Risk, Economics. Dec. 4, 2014

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Table of Contents
(Click to sections below.)

1) In Canada, More Jobs in Green Energy than Tar Sands | Common Dreams | Breaking News & Views for the Progressive Community

2) CO2 warming effects felt just a decade after being emitted

3) Fastest-Melting Region of Antarctica Triples Rate in a Decade | TIME

4) Encroaching Tides: What's at Stake for the US – YouTube

5) Autumn Statement — One eye on election – YouTube

6) Memphis' Traditional Apartment Storyline Isn't Playing Out – YouTube

7) MULTI – the world's first rope-free elevator system – YouTube

8) Tom Mundy, Head of Research at JLL Russia & CIS, on the Russian real estate market at the BBC World – YouTube

9) How being a real estate agent saves me money as an investor – YouTube

10) Ice and winds cause havoc in east and central Europe – YouTube

11) Antonio Fatas on the Global Economy: The logic behind the German Euro gamble.

12) The Rising Costs of US Income Inequality by Laura Tyson – Project Syndicate

13) China's interest rate cut is mixed blessing for the world economy

14) Common Mistakes When A Home Is Damaged In A Storm | Fox Business

15) New G20 Rules: Cyprus-style Bail-ins to Hit Depositors AND Pensioners | WEB OF DEBT BLOG

16) Antarctica watch

17) A Ripple, Not a Wave- Predicting the Impact from Future HELOC Loan Resets

18) Zillow Predicts Breakthrough Year for First-Time Buyers in 2015 – Zillow Blog – Real Estate Market Stats, Celebrity Real Estate, and Zillow News

19) Drought in US and Brazil Linked to Hottest Year Ever – Bloomberg

20) UPDATED: Fatal fire victims identified | State News – WGAL Home

21) Fire officials seeing uptick in fatal blazes – WSMV Channel 4

22) Knife River water gone, but problems remain

23) The Ponzi Scheme Blog: November 2014 Ponzi Scheme Roundup

24) Construction spending rises more than expected in Oct

25) Home equity is back and homeowners are loving it

26) Autumn Statement: George Osborne promises tax cuts and spending cuts – but can he deliver? – UK Politics – UK – The Independent

27) Fed's Fisher: Texas likely to benefit from lower oil prices | Reuters

28) mainly macro: The OBR confirm the dangers of Osborne's gamble

29) Brooklyn is the least affordable housing market in the US | New York Post

  1.    In Canada, More Jobs in Green Energy than Tar Sands | Common Dreams | Breaking News & Views for the Progressive Community

    In our last News post, we said that putting the environment first doesn't mean a bad economy. We then ran into this article at least partially substantiating our view.

    Canada's clean energy sector is booming, with the number of people who work for green energy organizations outnumbering those whose work relates to tar sands, finds the first annual status report on the country's shift to renewable power.

    As far as we're concerned, the sooner we stop using tar sands, the better.

    Add your comment.


  2.    CO2 warming effects felt just a decade after being emitted

    …the median time between a single CO2 emission and maximum warming was 10.1 years, and reaffirmed that most of the warming persists for more than a century.

    Add your comment.


  3.    Fastest-Melting Region of Antarctica Triples Rate in a Decade | TIME

    …losing the water weight of Mt. Everest every two years.

    By the way, we think that ice thinning is the most important thing to look for and watch.

    Add your comment.


  4.    Encroaching Tides: What's at Stake for the US – YouTube

    Risk management:

    The eastern coast of the United States– from the Gulf of Mexico to New England — has one of the highest rates of sea level rise in the world. As a result of climate change, 5 to 11 inches of sea level rise is expected by 2045 leaving communities like Norfolk, Virginia, Miami Beach and Fort Lauderdale, Florida and Annapolis, Maryland essentially inundated. Dr. Brenda Ekwurzel of the Union of Concerned Scientists speaks to Earth Focus about what's at stake for major U.S. coastal cities and local communities and the choices they need to make to adapt to this imminent threat.

    Add your comment.


  5.    Autumn Statement — One eye on election – YouTube

    George Osborne has announced a radical reform of stamp duty alongside a tax crackdown on banks and multinational companies in his Autumn Statement. Janan Ganesh and Chris Giles analyse this pre-election statement with UK news editor Michael Stott.

    The conversation is worth listening to, because so much is riding on whether the Brits continue with austerity or not.

    We think the most salient comment was by Janan Ganesh pointing out that the competition hasn't been offering much.

    As far as we're concerned, "New Labour," which is clearly still there, has been a major disaster.

    The UK needs radical banking and monetary reforms if it is to really succeed for its people.

    Add your comment.


  6.    Memphis' Traditional Apartment Storyline Isn't Playing Out – YouTube

    The Memphis apartment sector has traditionally been a subpar performer on the whole, while offering a couple attractive, outperforming spots. But one of the key historically strong submarkets is in the midst of a surprisingly drawn-out slump.The Memphis apartment sector has traditionally been a subpar performer on the whole, while offering a couple attractive, outperforming spots. But one of the key historically strong submarkets is in the midst of a surprisingly drawn-out slump.

    Add your comment.


  7.    MULTI — the world's first rope-free elevator system – YouTube

    ThyssenKrupp develops the world's first rope-free elevator system to enable the building industry face the challenges of global urbanization. MULTI is ThyssenKrupp's latest offering in its extensive repertoire of elevator technologies, representing a landmark revolution in the elevator industry and a new and efficient transport solution for mid and high-rise buildings.

    Well, okay, it's an ad; but we thought you'd still be interested.

    Add your comment.


  8.    Tom Mundy, Head of Research at JLL Russia & CIS, on the Russian real estate market at the BBC World – YouTube

    A quite-good analysis:

    Sanctions, falling oil and increasing risk perception have put Russian economic growth under continued pressure. How have the Russian property segment changed this year? Tom Mundy, Head of Research at JLL Russia & CIS, at the BBC World News.

    Add your comment.


  9.    How being a real estate agent saves me money as an investor – YouTube

    This is a very clear and straightforward presentation by Mark Ferguson, no hype, no hemming and hawing.

    I saved over $70,000 on my investment properties by being a real estate agent in 2013. There are some donwfalls to being an agent and investor, but overall if you want to be a serious investor I suggest you become a real esate agent as well.

    You may find Mark at investfourmore.com.

    Add your comment.


  10.    Ice and winds cause havoc in east and central Europe – YouTube

    Cold weather has been causing havoc in east and central Europe. In Serbia emergency workers "risked their lives", according to the electrical grid company EM…

    Add your comment.


  11.    Antonio Fatas on the Global Economy: The logic behind the German Euro gamble.

    Antonio Fatas:

    5. Competitiveness and low wages are the key to growth. Wrong. Prices need to reflect the balance of supply and demand and while it is possible that in some cases some prices or wages are above their optimal levels the idea that reduction in nominal wages leads to growth is wrong. It just leads to deflation. And the idea that reduction in real wages is always good makes no sense. If this was true, let's all work for free to be more competitive. In addition, reduction in wages look a lot like competitive devaluations that we know are not possible everywhere.

    9. Demand does not matter, the only thing that matters is supply and structural reforms. Wrong. Recessions are a reality and some of them are driven by a deficiency in demand. While it will still be true that reforms are needed (see point #1), in the short-term policy should be focused on demand. And what matters for the short run (spending) might be different than what matters for the long run (saving and investment).

    Add your comment.


  12.    The Rising Costs of US Income Inequality by Laura Tyson – Project Syndicate

    This article is a steady hammer. It's just one nail after another in the US economy. Then comes the end if we don't radically change the current trajectory.

    Laura Tyson:

    Although the economic costs of income inequality are substantial, the political costs may prove to be the most damaging and dangerous. The rich have both the incentives and the ability to promote policies that maintain or enhance their position.

    Given the US Supreme Court's evisceration of campaign-finance restrictions, it has become easier than ever for concentrated economic power to exercise concentrated political power. Though campaign contributions do not guarantee victory, they give the economic elite greater access to legislators, regulators, and other public officials, enabling them to shape the political debate in favor of their interests.

    As a result, the US political system is increasingly dominated by money. This is a clear sign that income inequality in the US has risen to levels that threaten not only the economy's growth, but also the health of its democracy.

    Add your comment.


  13.    China's interest rate cut is mixed blessing for the world economy

    Hans H. Tung:

    In light of what happened during the crisis, is the recent rate cut going to do much good? This mostly depends on whether local politicians are allowed to distort how the additional bank credit gets allocated, as was the case in 2008 and 2009. From this perspective, China's banking system remains pretty much the same as it was then. The cut will not only give the deeply indebted state-owned enterprises and investment companies a new lease on life, but it will also leave the overcapacity issue unresolved, or even worse than before.

    Add your comment.


  14.    Common Mistakes When A Home Is Damaged In A Storm | Fox Business

    According to insurance experts one of the biggest mistakes homeowners make, particularly those with low deductible home insurance plans, is filing small claims multiple times. According to Bill Wilson of the Independent Insurance Agents and Brokers, there's nothing wrong with contacting your agent or carrier to see if something is covered but what you don't want to do is file a claim for something you can afford to take care of on your own. "Some people feel compelled to report every little claim because they have a low deductible," says Wilson. "Sooner or later the insurance company will probably elect to not renew your policy if you have a claim-frequency problem."

    Add your comment.


  15.    New G20 Rules: Cyprus-style Bail-ins to Hit Depositors AND Pensioners | WEB OF DEBT BLOG

    With the exception of the treatment of the FDIC, we fully agree with the spirit and letter of Ellen Brown's article here.

    Here's what we think about the FDIC. When push comes to shove in another major banking crisis (self-caused, as with the last one that's still really on-going in the form of the Great-Recession-cum-Lesser-Depression), the FDIC will always be backstopped by the full faith and credit of the US. The US will create all the new money necessary to honor FDIC insurance obligations because to do otherwise would result in the violent overthrow of the US government if necessary for the people to get their money back.

    Under no circumstances does our statement suggest for a moment that the Financial Stability Board's "Adequacy of Loss-Absorbing Capacity of Global Systemically Important Banks in Resolution" plan is a good one. Frankly, it's very poor for the reasons cited by Ellen and those she quoted in her piece.

    Individual FDIC-insurance accounts will be protected, but households and firms that don't split up their large accounts into multiple accounts of no more than $250,000 will stand to lose.

    Splitting all current accounts to meet that low deposit amount would be a nightmare in many cases. It would be extremely unwieldy.

    Banks that fail should not be bailed out or bailed in. They should be taken over, nationalized, reorganized, recapitalized, and executive compensation clawed back.

    Add your comment.


  16.    Antarctica watch

    Antarctic sea ice has continued to decline at a faster-than-average pace (approximately 122,000 square kilometers, or 47,100 square miles per day through the month of October, compared to the average rate of 112,000 square kilometers or 43,200 square miles per day), and is now about 650,000 square kilometers (251,000 square miles) below the level for the date recorded in 2013. Currently ice extent remains about 700,000 square kilometers (270,000 square miles) higher than the 1981 to 2010 average for this time of year. Large reductions in the Bellingshausen Sea and the southern Indian Ocean were the main causes of the Antarctic-wide decrease, driven in large part by persistent northerly winds. Air temperatures over the Southern Ocean for the month were near average in nearly all areas. On the icy continent itself, cool conditions prevailed over the Antarctic Peninsula and West Antarctica (1 to 2 degrees Celsius, or 1.8 to 3.6 degrees Fahrenheit below average) while warm conditions were the rule in the Eastern Hemisphere section (2 to 4 degrees Celsius, or 3.6 to 7.2 degrees Fahrenheit above average).

    Add your comment.


  17.    A Ripple, Not a Wave- Predicting the Impact from Future HELOC Loan Resets

    Sam Khater:

    What will the impact of the payment shock be on the broader market? It is expected that the impact will be minor for a few reasons. First, the size of the $190 billion reset is very small relative to the $9.9 trillion mortgage market1. Second, 25 percent of HELOCs are in the first-lien position, meaning there is no other associated debt. Third, the major dual triggers of default, negative equity and unemployment are improving. The negative equity share for first liens with a home equity loan is 22 percent, well below the 36 percent rate four years ago, and it is rapidly improving. The unemployment rate in 2010 was more than 9 percent, but it has since declined to under 6 percent. Adjusting for the first-lien position and negative equity means that the HELOC exposure shrinks from $190 billion to $31 billion. While the spike in defaults at the 10-year mark certainly is an issue for those borrowers experiencing the reset, from a macro perspective the impact will not be a wave, but small ripples.

    Add your comment.


  18.    Zillow Predicts Breakthrough Year for First-Time Buyers in 2015 — Zillow Blog – Real Estate Market Stats, Celebrity Real Estate, and Zillow News

    Zillow's 2015 predictions are based on housing data that shows rents continuing to skyrocket while the for-sale market levels off.

    If true, it will show that those who build for residential landlords underdeveloped and that in the aggregate and as a consequence, landlords failed to retain market share.

    Add your comment.


  19.    Drought in U.S. and Brazil Linked to Hottest Year Ever – Bloomberg

    Drought in California and Brazil, the U.K.'s wettest winter and floods in the Balkans are among the extreme weather patterns that marked what's on track to be the hottest year ever recorded.

    …Every year since 2000 ranks among the 15 hottest on record.

    Are we ready to tackle this globally rather than falsely claiming that it's only the Sun that's doing it or that Anthropogenic Global Warming doesn't matter or is a good thing, etc.?

    It"s well beyond the time we stop using carbon-based fuels.

    Add your comment.


  20.    UPDATED: Fatal fire victims identified | State News – WGAL Home

    Our suggestion is that you do not allow your tenants to hoard. Work with them compassionately though, as such hoarding is a sign of mental problems that can range from minor to very serious, depending.

    Sometimes bringing in outside authorities who can help with mental-health issues is the wisest course of action; but don't delay to take action one way or the other, as fires can breakout and can obviously be deadly.

    If your tenant(s) won't cooperate, you might seek emergency actions via court order. Simply waiting for the clock to run out on standard state and local statutes about evictions and so forth may not be wise.

    WARWICK TOWNSHIP, Pa. —Two people died in a house fire in Warwick Township, Chester County early Saturday [November 29, 2014] morning.

    According to Deputy Fire Chief Jason Brooks, extreme hoarding conditions inside the home and heavy fire created challenges, prolonging firefighting efforts.

    Brooks says throughout removal of debris a large amount of weapons and ammunition were discovered, including explosives.

    Add your comment.


  21.    Fire officials seeing uptick in fatal blazes – WSMV Channel 4

    Be extra careful.

    KNOXVILLE, Tenn. (AP) — Fire officials in eastern Tennessee are seeing an increase in the number of fires and an uptick in the number of fatalities stemming from those blazes.

    …the increase is in part due to cooking around the holidays and electrical reasons.

    We wonder if increased drinking might have something to do it with too. There are probably many variables at work.

    Add your comment.


  22.    Knife River water gone, but problems remain

    RURAL MARSHALL, N.D. — The unusual August flood of the Knife River near tiny, unincorporated Marshall quickly receded, but the dirty water of the disaster keeps circling the drain.

    For the Stein family — the couple and their two daughters — the disaster that started late that night in August was like a stone dropped in the river: The ripples are still reaching the bank.

    Two neighbors, Clara and Ingvald Paulson, are still displaced, living in a rental unit in Taylor. They took refuge on the roof of their house when the water started coming into the farm house.

    They didn't have insurance and said any assistance they get will go toward fixing fences or toward expenses to live in town.

    "They didn't have insurance…."

    Add your comment.


  23.    The Ponzi Scheme Blog: November 2014 Ponzi Scheme Roundup

    Kathy Bazoian Phelps always puts great effort into bringing the public this information. We've included the "real-estate" entries.

    Below is a summary of the activity reported for November 2014. The reported stories reflect: 9 guilty pleas or convictions in pending cases; over 80 years of newly imposed sentences for people involved in Ponzi schemes; at least 5 newly discovered schemes involving more $100 million in the aggregate; and an average age of approximately 56 for the alleged Ponzi schemers. …

    C. Tate George, 44, was denied a new trial on his conviction relating to a $2 million Ponzi involving real estate investments. George sought a new trial based on his contention that he had ineffective counsel and there was prosecutorial misconduct that led to his convictions.

    Shervin Neman aka Shervin Davatgarzadeh, 33, had his sentencing hearing delayed. Neman was convicted in connection with a $3 million Ponzi scheme that defrauded Iranian Jews living in Southern California. Neman had represented that investor funds would be used to purchase foreclosed real estate and stocks, but instead use the money to repay other victims and on personal expenses. Neman ran the scheme through his company, Neman Financial Inc. A month after the SEC had sued Neman, he solicited $2 million from another victim falsely representing that he could obtain pre-IPO shares in Facebook. He used the new funds to repay victims and that had the victims send in letters that they had been repaid.

    John Packard, 64, pleaded guilty to a charge relating to a $110 million real estate Ponzi scheme. Packard, along with Michael J. Stewart, 67, ran the scheme through Pacific Property Assets. They purchased, refurbished and resold apartment complexes using investor funds but continued to raise money from investors when the real estate market crashed. Pacific Property had decl ared bankruptcy, listing $90 million owed to 647 investors and $100 million owed to banks. Stewart has pleaded not guilty and is scheduled to go to trial in April 2015.

    Laurie Schneider, 39, was sentenced to 3 years in prison for running a $7 million Ponzi scheme. Schneider used two shell corporations to run the scheme — Janitorial Close-Out City Corporation and Eager Beaver Realty LLC. Janitorial Close-Out supposedly purchased and resold janitorial equipment and machinery at a profit margin of 15% to 60% in a short term so that she could promise investors up to 60% returns annually. Eager Beaver supposedly bought and sold real estate, and investors were promised returns of up to 20%.

    Louis Spina, 57, pleaded guilty to charges in connection with a $20 million Ponzi scheme. Spina ran his scheme through LJS Trading LLC and promised dozens of investors returns ranging from 9% to 14% from trading stocks and equities. Instead of investing, however, Spina lost all of the $9.5 million that he invested and spent the rest to purchase expensive cars, real estate and to make a $400,000 donation.

    Robert Van Zandt, 70, pleaded guilty to running Ponzi scheme. It is believed that the scheme involved over 250 investors and $35 million. Van Zandt promised investors returns from investments in real estate, U.S. government backed securities and other investments, but instead he used the money for personal and business expenses.

    Visit the link for more info: Great Source.

    If you've been hit by a Ponzi scheme or only think you may have been, you might want to contact her.

    Disclosure: We don't know her personally and are only going by the info on the linked page.

    Add your comment.


  24.    Construction spending rises more than expected in Oct

    U.S. construction spending rose more than expected in October as both private and public outlays increased, which could ease concerns of a sharp slowdown in fourth-quarter economic growth.

    Lower fuel-costs won't hurt going forward either.

    Lower fuel-costs and increased construction have traditionally been the leading indicators of real recoveries. When coupled with low interest rates, things can often heat up. Of course, there are always other factors that can be headwinds.

    By the way, we can't recommend having that forklift parked that way right there. It might constitute an attractive nuisance. There appear to be other unnecessary risk being taken as well by parking it there and in that way.

    Add your comment.


  25.    Home equity is back and homeowners are loving it

    "It certainly seems like people are doing it a lot more responsibly now," said Rick Huard, senior vice president of consumer lending product management at TD Bank. "People seem to be much more educated customers and much more responsible."

    They have to be, because on the flip side, lenders aren't just handing out the loans to anyone with a pulse. During the last housing boom, borrowers extracted trillions of dollars worth of home equity, spending it on luxury goods and vacations, as lenders turned a blind eye to basic safeguards, like the ability to repay the loan or the borrower's other debt load.

    Today, lenders are following more stringent guidelines enforced by federal regulators….

    … By taking out a new HELOC to pay off a current one, homeowners can start that 10-year credit period over again.

    Hmmm?

    Add your comment.


  26.    Autumn Statement: George Osborne promises tax cuts and spending cuts – but can he deliver? – UK Politics – UK – The Independent

    Nida Broughton, the SMF's chief economist, said: "Their plans appear to go far beyond even what fiscal conservatives would view as strictly necessary. The Government has given the public no rationale for these extra cuts. As a proportion of GDP, Government spending is being taken back to the level last since in 1938. If there was room for doubt before, there appears to be little now. A dramatically smaller state, not fiscal credibility, is the real goal here."

    The main goal is to further enrich the already rich at the expense of everyone else. Nothing has changed.

    Add your comment.


  27.    Fed's Fisher: Texas likely to benefit from lower oil prices | Reuters

    The state of Texas, a big producer of U.S. oil, is diversified enough that overall it will be a "beneficiary" of cheaper crude prices, Dallas Fed President Richard Fisher said on Wednesday.

    Is it? We shall see one way or the other if the low prices continue long enough. We suspect he's wrong, quite wrong.

    Add your comment.


  28.    mainly macro: The OBR confirm the dangers of Osborne's gamble

    A point I have repeatedly made about George Osborne's plans for a new wave of austerity, confirmed in his Autumn Statement today, is that they risk making the same mistake as 2010. Short term interest rates will be only just above their lower bound in 2015, at best. Large cuts in government spending from 2015 on will reduce aggregate demand. So if something goes wrong (and the list of possibilities is long), monetary policy will not be able to come to the rescue.

    Add your comment.


  29.    Brooklyn is the least affordable housing market in the US | New York Post

    Brooklyn was even less affordable than its ritzier neighbor to the north, Manhattan — which ranked third least affordable on the list. San Francisco ranked the second least affordable.

    Add your comment.


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