Linking ≠ endorsement.
⇧ Still Report #355 – TPP Coming Fast – YouTube
Corporations are going to try to squeeze the Trans-Pacific Partnership "trade deal" through Congress in 30 to 60 days from now.
We don't agree that Obamacare has been the nightmare Bill seems to think it is, though we certainly have issues with it. We do agree with him about this TPP problem.
⇧ Robert Reich takes on the Trans-Pacific Partnership – YouTube
Here's the Robert Reich video to which Bill Still referred in the video above. Please note that Bill is Libertarian leaning while Robert is Populist leaning. This is important because Corporatists are both anti-liberty and anti-people.
The Trans-Pacific Partnership (TPP) is the largest–and worst–trade deal you've never heard of and Republicans in Congress want to work with the Obama administration to "fast track" its passage.
Barack Obama's doing a very foolish thing here.
You may wonder how such a situation could even exist. Well, it's do to the US Constitution giving foreign policy over to the executive branch and making all treaties (agreements such as the TTP) the law of the land just as if written into the US Constitution and amending it to supersede all of its other protections for the people (including the Bill of Rights). The Congress, unfortunately for the reason given by Bill Still (campaign money; we'll add deals and favors including for when the politicians leave office).
Barack Obama, whether wittingly or unwittingly, is leading the US into a potential civil war (no time frame) by not going after the banksters and other hyper-greedy corporate interests that put themselves before the good of all the American people and other peoples of the world who don't deserve to be mistreated as they have been and still are by certain (not all) US corporate interests.
⇧ "'Low-life scum' of the world — Unite!": Newsletter: What Would Zinn Do? | PopularResistance.Org
We don't march in lockstep with all of the views expressed in this newsletter from Popular Resistance but do agree with much of their platform.
These are very politically charged issues that often cut right across the Libertarian-Progressive divide.
If fits in nicely with the two preceding videos.
The letter is packed and written by some very skilled and organized minds.
They are no disorganized anarchists producing such newsletters. The degree to which they oppose private enterprise may be a question in your mind.
A reading of their About Us (https://www.popularresistance.org/about us/) page suggests that they are social democrats, meaning for a mixed economy leaning way over to the democratic side (small-d; not Democratic Party). They don't appear to be democratic socialists, who are opposed to all private enterprise.
If you read the Wikipedia article on social democracy (2/1/2015 version), it will give you a completely wrong definition by incorrectly conflating social democracy with democratic socialism.
'Low-life scum' of the world — Unite!
We must say that John McCain handed his anti-neocon/neoliberal opposition a great phrase there.
⇧ No more debt forgiveness for Greece, says Angela Merkel – Telegraph
Angela Merkel ruled out cancelling more of Greece's national debt on Saturday, appearing to dash the hopes of the country's new government.
If she persists and prevails, Greece may end up having no choice but to default.
Contrary to a great deal of false propaganda coming from the neoliberals, Greece is far from the root cause of its problems. The Reagan/Thatcher administration started the world down the wrong path that lead directly to the global crash of 2007-8. Little Greece made plenty of mistakes, but it should not be paying for the evils of people who have barely received a slap on the wrist.
In addition, Angela Merkel is devoid of macroeconomic understanding and knowledge of where money actually comes from and why Europe doesn't have to put Greece through the wringer anymore just to suffer through waiting for prosperity to magically appear.
The euro could become bond-free, and the Eurozone could have the exact amount of currency needed to bailout all the hurting countries without so much as a blip in inflation.
⇧ Realities of Real Estate: What's hot and what's not in home design – capitalgazette.com
Here are the top home design trends according to Zillow, CBS MoneyWatch and Realtor magazine. And, based on our experience in visiting thousands of homes over the past few decades, we'll put in our two cents regarding what changes might contribute to enhancing the value of a home and which ones could end up being nothing more than a flash in the pan.
Much of it is decorating rather than what some might consider design.
⇧ Boise: State auctions 32 properties on Payette Lake, gains $13.47 million | Local News | Idahostatesman.com
Boise — In 2010, Idaho's Land Board approved a plan to sell off most of the 500-plus cottage sites the state Department of Lands controls on Payette and Priest lakes.
⇧ China's January manufacturing PMI falls to 28-month low – Xinhua | English.news.cn
BEIJING, Feb. 1 (Xinhua) — Chinese manufacturing business activity continued to wane in January as a key index dropped to below 50 for the first time since October 2012, marking increasing downward pressures on the economy, official data showed on Sunday.
Even before the release of the GDP numbers, a number of Western media and policy pundits were predicting a China stall. Issues with the real estate sector, local government debt, SOE intransience, shadow banking, over capacity and a weak global economy were cited as the factors which would continue to push growth rates lower in the future.
We have been one of those pundits.
⇧ Greece's Yanis Varoufakis begins European talks in France | Business | The Guardian
Greece's new anti-austerity government … [kicked] off its European charm offensive in Paris on Sunday seeking to renegotiate its €240bn (£179bn) bailout despite resistance from Germany to consider any debt relief.
It will be ironic if Germany ends up isolated. The German people have chosen the counter-productive policy of neoliberalism.
⇧ mainly macro: Delusions on the UK left
Yes Greece voted for Syriza, but only when half of its young people were stuck in unemployment. Is that the future that he hopes for by abandoning tactical voting?
We used to think the way Simon indicates here. The thing about Simon's question about Monbiot there is that the question would be how long it would take for the British voters to change. Why should it take as long as it did for the Greeks now that the Greeks have won? If Spain and other nations follow the Greek lead regardless of Germany, then Britain would become ripe very quickly, as those other downtrodden nations will show the way out of neoliberalism also very quickly.
Let Labour change right now, all of it. Let Labour immediately stand back up as Labour by completely repudiating Blair's "New Labour" for what it has been, anti-labour. It's better to be down for a while and then take over than to be down forever under a false name like "New Labour."
⇧ Yanis Varoufakis Newsnight interview – YouTube
This is what you get when you have a guest who is quite high IQ and extremely knowledgeable in his field being interviewed by someone (pardon us) who is not nearly as bright but highly trained to be robot-like insisting upon, or looking for, simple yes or no answers and with the aim of not allowing the brighter person's knowledge and correctness to come out. It makes for terrible TV.
It is distraction and counter-productive, but that's the point. The interviewer is annoying, so you as viewer are supposed to translate that onto Yanis Varoufakis and agree with neoliberal economics or back it even though you may not even have the faintest idea of what it is and who benefits by it and who is kept down by it.
Greece's new finance minister Yanis Varoufakis interviewed on 30 January 2015 on BBC's Newsnight.
⇧ Podemos 'March for Change': Tens of thousands rally in Madrid against austerity – YouTube
Tens of thousands of Spaniards have taken to the streets of central Madrid in support of Podemos, a leftist political party campaigning on an anti-austerity platform. The party's popularity has soared in the wake of the Syriza victory in Greece
In the video, you'll hear the question of where is the money going to come from. It will come from the same place all money comes from if the European people will democratically create the money they need and want in the right quantities.
There's nothing difficult about it other than getting usurers out of the way. Vote people into office who won't be bought off for personal gain at the expense of the whole people but who will do what's best for the masses. That's all.
⇧ Woman sentenced for arson, insurance fraud – Toledo Blade
A Toledo woman who set fire to a duplex she owned to collect insurance proceeds was sentenced Friday to 14 months in prison.X
⇧ Calculated Risk: Demographics and GDP: 2% is the new 4%
..political hacks will continue to ignore demographics.
True, but we'd like to see the data weighted for labor participation for those who are older but would get back in if wages and salaries were right (which would take many new jobs created in higher-skilled jobs).
Where are the public jobs while the private sector deleverages?
⇧ mainly macro: Saying the obvious
Sometimes things that are actually micro, like financial regulation or labour supply responses to tax changes, seem just to get labelled macro when they become controversial or have macro consequences!
We're not sure these things on a nationwide or global level aren't inherently macro or even in a gray zone. After all, its why the term macroprudential exists.
We don't know that it matters much either way. The economy is a continuum where always looking at only the large or only the small seems a waste of time, to automatically miss the most important.
⇧ How negative can interest rates go? | Gavyn Davies
We have always said that negative rates were not only doable but could be highly beneficial if handled correctly: strings attached to education and fiscal spending.
The problem still lies in getting money moving again in the real economy.
We still need fiscal stimulus and not just any old stimulus but highly productive: new, higher-paying, full-time, permanent jobs.
As global bond yields plumb new depths, an unprecedented experiment in monetary policy is underway in two small countries in Europe. By pushing policy interest rates more deeply into negative territory than ever seen before, the Swiss and Danish central banks are testing where the effective lower bound on interest rates really lies. The results are being closely watched by bond investors, and by the major central banks, which had previously assumed that the effective lower bound was close to zero.
⇧ The Long-Run Cop-Out – NYTimes.com
Paul Krugman is missing what's actually going on with the following:
Oppose austerity and support monetary expansion and you'll be lambasted by the right; do the reverse and you'll be criticized and maybe ridiculed by the left.
The right wants to shrink government so the rich can take a cut on everything that the public sector does now without contracting it out to corporations, etc. It's as simple as that.
It doesn't matter whether the given goods or services can be supplied better via public ownership or regulation of the means. The right wants to make a cut no matter what. That's their ideology, and every argument they make is centered around accomplishing that. If they have to ignore or obfuscate, that's what they'll do.
This is not to say that there aren't people on the left who employ the same tactics. There are, unfortunately.
⇧ The family-business factor in emerging markets | McKinsey & Company
"All the world is trying to make managers think like owners. If we put in one of the owners to manage, we don't need to solve this problem." An owner—manager can move much more rapidly than an executive hired from outside. There's no need to pass decisions up a chain of command or to put them in front of an uncooperative board, and many of the principal—agent challenges that confront non-family-controlled companies are neutralized. Family-owned businesses can therefore place big bets quickly, though of course there's no guarantee that they will pay off. Still, manager—owners are largely relieved of the quarter-to-quarter, short-term benchmarks that can define—and distort—performance in Western public companies, so they're freer to make the hard choices necessary to create long-term value.
Indeed, the owners' long time horizons and sense of mission often suffuse the whole organization. A McKinsey survey of businesses owned by families and founders showed that 90 percent of board members and top managers—family members or not—said that family values were present in the organization, and fully 70 percent said that they were part of its day-to-day operations. For the past ten years, McKinsey has measured and tracked organizational health in hundreds of companies, business units, and factories around the world. Nearly two million employees have answered questions that rate the health of their organizations. We then produce a single health score, or index, reflecting the extent to which employees agree that their companies meet empirically derived litmus tests in each of nine dimensions of organizational health. When we isolate businesses owned by families and founders in emerging markets—as we did for nearly 60 leading companies in Asia, Central America, and South America, with over 100,000 survey respondents—we see health outcomes that are better than or comparable to those of other companies in the same markets (Exhibit 2). Moreover , in Asia these companies are stronger than their non-family counterparts on several specific management practices, including shared vision, strategic clarity, employee involvement, and creativity and entrepreneurship.
About the authors
Åsa Björnberg is a senior expert in McKinsey's London office, Heinz-Peter Elstrodt is a director in the São Paulo office and coleader of the Family Business Practice, and Vivek Pandit is a director in the Mumbai office.
⇧ So Whose Problem Is Greek Debt, Anyway?
Grexit would be an unmitigated disaster not just for Greece, but for the whole Eurozone. And Varoufakis knows this perfectly well. Threatening to default is a powerful strategic move to which the Troika has so far found no satisfactory response. Withdrawing ELA from Greek banks would simply precipitate disorderly unwinding of the Euro. The ECB can no more follow through on this threat than it could when it threatened to do the same to the Irish banks in 2010. But Varoufakis is not Enda Kenny. The ECB may well find its bluff called this time.
Greek debt is everyone's problem. It is in everyone's interests to work together to find a solution.
⇧ The Three Elements Of A New Deal For Greece And The Eurozone
One key principle of negotiation is that you negotiate interests, not positions. The positions in this case are mutually exclusive: Syriza insists on a debt write-down, the creditor countries insist on repayment. As the sustainability of the debt depends on the cirucmstances (see Andrew Watt here), I think there is a solution if you move beyond positions and try to reconcile interests.
The creditor countries' interest is effectively the same as their position: they don't want to be seen rolling over and giving in. The interest of the Greek government, however, is to free up funds to kick-start growth again and deal with the humanitarian crisis in the country. The negotiation position of debt write-down is a means to that end.
About Henning Meyer
Henning Meyer is Editor-in-Chief of Social Europe and a Research Associate of the Public Policy Group at the London School of Economics and Political Science. He frequently writes opinion editorials for international newspapers such as The Guardian, DIE ZEIT, The New York Times and El Pais and comments regularly on TV news channels.
⇧ APARTMENT MARKET STATISTICS: January 2015 | Multi-Housing News Online
Housing starts rose by 18 percent over the month of September 2014 to 353,000 units, according to the National Association of Home Builders (NAHB).
Okay, but that data is 4 months old. A great deal has happened since then.
⇧ Wall Street for President? by Simon Johnson – Project Syndicate
We love the title of the article. It made us laugh even though it's message is sad but true.
Simon Johnson, a former chief economist of the IMF, is a professor at MIT Sloan, a senior fellow at the Peterson Institute for International Economics, and co-founder of a leading economics blog, The Baseline Scenario.
Warren's message is simple: remove the implicit government subsidies that support the too-big-to-fail banks. That single move would go a long way toward reducing, if not eliminating, crony capitalism and strengthening market competition in the financial sector. This is a message that plays well across the political spectrum. And growing support for Warren's ideas helps the Federal Reserve and other responsible regulators in their efforts to prevent big banks from taking on dangerous levels of risk.
⇧ audioBoom / Prof. Steve Keen on what's really going on in Greece
Steve Keen on Yannis Varoufakis and much more:
Steve Keen on why the Greek finance minister is fantastic, Euro QE will not work and how conventional economists have no idea how the real world works.
⇧ France Open to Easing Greek Debt Burden: Finance Minister – Bloomberg Business
France down, Germany to go:
France is ready to offer Greece concessions on its debt to help the country's new government revive its economy, Finance Minister Michel Sapin said.
Varoufakis appointed Lazard Ltd. as adviser on issues related to public debt and fiscal management on Saturday.
"There is a range of possible solutions: extending the maturities, lowering interests rates, and the much more radical solution, the haircut," Matthieu Pigasse, the head of Lazard's Paris office who has advised Greece in the past, said in a Jan. 30 interview on BFM Business television. "If we could cut the debt by 50 percent" he said, "it would allow Greece to return to a reasonable debt to GDP ratio."
⇧ Retaking the Greek Test
Predictably, and despite concessional terms, the Greek debt levels remain unmanageable. The unending fiscal austerity caused GDP to collapse and is steadily reducing the price level, making the debt burden more onerous. The debt ratio has continued to rise faster than forecast and the current projections of a decline are not credible.
Angry German politicians want Greece to leave the euro area. But the exit would cause global financial mayhem and the costs to Germany would be much greater than from a write down of Greek debt.
No matter who now governs the country, forgiving Greek debt would give Greece a real opportunity to restart its economy. Official debts forgiven in the aftermath of World War I led to: "higher income levels and growth, lower debt servicing burdens and lower government debt."
…Greek debt will eventually be written down. Doing so in driblets will only drag the process out while the Greeks hurt and European political divisions deepen. Till then, the Greek test will need to be taken again—and again.
⇧ Croatia wipes out the debts of thousands of its poorest citizens in 'fresh start' scheme – Europe – World – The Independent
Overall, the debt of all Croats amounts to $4.11 billion — and the debt that is about to be wiped out accounts for less than 1 percent of that. However, for those who are eligible the agreement will make a significant difference by enabling them to gain access to their bank accounts.
It's a token.
⇧ Uber self-driving cars: Autonomous taxis aren't so good for contractors in the 1099 economy.
This is perhaps a bit off subject, but it's important in that it points to what we've been saying for some time now, long before we heard it anywhere else. The time is fast approaching when working for money will not be technologically necessary for any human being. We must begin planning as soon as possible for how everyone will be provided for at a high quality of life. It is doable and the right thing to do.
In May 2014, Uber CEO Travis Kalanick set off alarm bells when he suggested at a tech conference that self-driving cars, and not people, were the future of Uber's ride services. "The reason Uber could be expensive is because you're not just paying for the car—you're paying for the other dude in the car," Kalanick said. "When there's no other dude in the car, the cost of taking an Uber anywhere becomes cheaper than owning a vehicle."
Read the whole article.
The issue is that without replacement sources of compensation and as more and more jobs are taken over by robotics, who will be able to pay Uber for a ride? That's why we said what we did above the block quote. It won't just end at some point leaving humans with mandatory work. It will extend to all labor and mundane creativity. The only thing left to do will be continuing to perfect humanity but without having to earn money to do it.
⇧ Andreas Dombret: The German real estate market – cause for concern?
This is an argument by Dr. Andreas Dombret (Member, Executive Board, Deutsche Bundesbank) against European QE, but it fails to address austerity and fiscal stimulus at the EU and Eurozone levels.
As you know, the Bundesbank takes a critical view of this government bond purchase programme. In our opinion, monetary policymakers are not under any acute pressure to act, as the low inflation rate is mainly attributable to falling energy prices. For the next two years, we are expecting inflation to pick up gradually; certainly, there is no sign of deflation.
What is more, government bond purchases are not simply a monetary policy instrument like any other where the euro area is concerned. They entail risks which we believe are not outweighed by the expected effects. At least the ECB Governing Council has agreed on a number of constraints to curb balance sheet risks, so that there will only be joint liability for a small portion of the programme. This will mitigate at least some of the problems which government bond purchases entail.
However, this additional monetary policy easing could have undesired side-effects. For instance, the low interest rates could encourage many investors, in their search for yield, to turn to assets they previously avoided due to the associated risks. This makes the emergence of price bubbles more likely, which could cause problems for the stability of the financial system.
⇧ EU's Juncker wants to scrap troika's mission to Greece: Handelsblatt | Reuters
European Commission President Jean-Claude Juncker wants to scrap the troika mission from international lenders that governs Greece's 320 billion euros ($360 billion) bailout, German daily Handelsblatt reported, quoting unnamed Commission sources.
Juncker, who is due to meet Tsipras in Brussels on Wednesday, has said he was not prepared to accept any direct write-off of Greece's public debt.
⇧ The ECB Ready to Put a Choke Chain on Syriza | naked capitalism
…Sapin made clear that France did not back Greece on its most important demand, that of debt reduction, which he called "cancellation," but would back a new timeframe and other changes in terms. Conventional wisdom in finance circles is that Greece will accept an extension of maturity, say from its current 30 years to 50 years, with a cut its back-ended interest payments, but that falls well short in terms of economic relief from what Syriza has asked for. Nor does it solve Greece's real underlying problem, that of insufficient demand.
On the one hand, quite a lot of the official commentary in the news is posturing. Our understanding is that a lot of pressure is being applied behind the scenes on Germany. But so far there has been absolutely no change in Merkel's and Schauble's stance. And there are signs that other European technocrats who might be able to exercise a moderating influence on the ECB, are also worried that Greece is overplaying its hand. Even Michel Sapin, the French finance minister, reportedly stated that Greece needs to come forward with its proposals "calmly and quickly."
…Wednesday is a critically important day. If the ECB does not put a time limit on the bailout funds, or has the backstop go until June, when Greece needs a deal regardless, it means that Syriza's high stakes strategy is still alive. But the ECB may move decisively, turing the promise of a new deal for Greece and democracies finally taking the reins back from financiers into a false dawn.
We think Greece has not overplayed its hand at all. The Greek government wants the right deal where it can lift the needless yoke from the necks of Greeks in a severe depression while still paying bondholders.
Considering that Greece didn't get itself into its mess without the connivance of predatory bankers even in the US, Germany certainly should share the temporary burden that would turn into a European boon with Germany benefiting greatly, certainly far beyond it simply being a wash.
⇧ John Smithin: Forging Fresh Tools from the Past – YouTube
Perhaps the most jam-packed INET video we've posted:
Professor Smithin argues that new economic thinking is not only about new thinking but also about recovering past knowledge from past crises. He talks about the policy response from the 2008 crisis compared to the 1930s. Most crucially, however, he discusses why teaching economics before and after the crisis has not changed; but "business as usual" is not appropriate. He argues that we need to rethink the "consensus" with tools old and new, starting with the original premise of neoclassical economics that barter is not the basis of economic exchange. He also takes issue with the representative agent problem and the proposed solutions.
We think abduction here is historical context that can always only be approximated and where the application of the data to a current or future environment will be confronted by new variables and different thinking/reactions.
We like that sort of adaptive thinking.
⇧  The politicization of the ECB and US budget battles – YouTube
[4:07] …Mark Thoma — professor of economics at the University of Oregon, columnist at The Fiscal Times, and author of the blog "Economist's View." Mark tells us if he thinks a minimum wage increase could increase worker productivity and gives us his take on why wage growth is slow.
[13:22] …Tim Duy — professor of economics at the University of Oregon, senior director of the Oregon Economic Forum, and a co-blogger at "Economist's View." Tim gives us his take on the growth of the US economy and tells us if the downshift in growth is due to demographic issues. He also weighs in with a detailed analysis of Fed policy.
Re: Mark Thoma, higher wages across-the-board aren't necessarily a wash. That's because more money might well be chasing lower prices in terms of rate of increase for both. Everyone's standard of living can rise.
Re: Tim Duy, we think he's being too hawkish. The labor-participation rate(s) and the issue of slack are more important to our thinking.
⇧ Stronger dollar, weaker exports? – YouTube
The thing about this is that the Saudis, in there view, can't allow prices to rise such that US fracking doesn't have to struggle along or where Iran and Russia, etc., benefit.
John Authers reports from New York on survey data that showed the weakest new US export orders in more than two years – an effect of the strong dollar? Meanwhile oil rallied, along with the stock market.
⇧ Why Podemos Poses A Major Threat To The Spanish Political Establishment
Our document was not a budget for the future Podemos government, but rather the strategic lines to be followed. The analysis of the causes of the crisis focused on the enormous growth of inequality responsible for the financial, economic, and political crisis. It puts at the centre of the analysis the conflict of capital (under the hegemony of financial capital) against labour. This has led to an enormous decline of domestic demand caused by the decline of wages, increases in unemployment, and cuts of social public expenditures. The proposals, therefore, aimed at reversing this growth of inequality by increasing domestic demand (via salaries and employment growth) and by expanding public expenditures and investments (in particular, the social infrastructure).
It also underlined the need to expand public banking, as a way of providing credit to families and to small and medium-sized enterprises. It proposed reducing the working week to 35 hours and reducing the age of retirement from 67 to 65, reversing policies approved by the PP and the PSOE. The impact of the programme would strengthen labour at the cost of capital. Furthermore, it showed the clear need to correct gender inequalities as a way of increasing employment. It also suggested how all the proposals could be funded, asking for substantial changes in the fiscal policies of the country and the reduction of tax fraud.
⇧ Behind the Numbers: PCE Inflation Update, December 2014 – Dallas Fed
PCE (Personal Consumption Expenditures) is what the Fed uses, not the CPI (Consumer Price Index).
The headline, or all-items, PCE price index fell at a 2.8 percent annualized rate in December, following a 2 percent rate of decline in November. As was the case in November, a sharp decline in the price of gasoline was the main culprit behind December's negative rate—the PCE price index for gasoline fell 9.3 percent in December and subtracted roughly 3 annualized percentage points off December's headline inflation rate.
While gasoline made the biggest negative contribution to headline inflation, price pressures apart from gasoline were also generally modest. Prices for core goods recorded a large 3.3 percent annualized drop, following a 5.8 percent annualized decline in November. Prices for core services advanced at a 1.3 percent annualized rate, well below that category's 12-month rate of 2.1 percent. Rent (up at a 2 percent annualized rate) and owners' equivalent rent (1.9 percent) registered notable decelerations.
Since gasoline prices look to have fallen even more sharply in January—they are on pace for a nearly 20 percent decline—January's headline PCE inflation rate should also be sharply negative, pulling the 12-month headline rate even lower than its current 0.7 percent.
⇧ Greek Retreat on Writedown May Move Fight to Spending – Bloomberg Business
"They're looking to restructure EU bilateral loans and ECB loans and leave IMF and private-sector debt alone," said Sarah Hewin, head of research at Standard Chartered Plc, who was at the meeting. "At the moment, they're working at a broad case without being specific on how this restructuring will take place."
Here's what we think needs to be understood. If what the banking and bond powers that be want doesn't work in terms of putting Greeks back to work, the Greek government should go right back loaded with the new, greater, clearer ammunition: facts, data.
The Greek government's first responsibility is getting Greece out of its depression, even if that means defaulting and/or leaving he Eurozone and EU.
If Greece goes along with a new plan here and it doesn't work, Germany will be responsible and will have to change or see the EU project crack and possibly break apart (Spain, etc.: contagion): exactly what the Germans shouldn't want to see.
⇧ Climate Change and its Impact on the Insurance Industry | Risk Management
Where Anthropogenic Global Warming meets the hard money that can't afford to play word games or to deny or cast doubt on the science in order to dupe the libertarian-leaning: Solid article by John G. Nevius and Robert M. Horkovich, both with Anderson Kill:
The incidence of hurricanes, superstorms, and mega-tornados will increase as temperatures rise. Flooding incidents will become more frequent as sea levels rise as a result of climate change. In addition to hurricanes, superstorms like Sandy, and mega-tornados, scientists predict 50% more lightning strikes will occur domestically over the next century based upon increases in precipitation and temperature. Additional risks include habitat loss, famine, and an increase in diseases such as malaria because of wetter weather conditions spawning mosquitoes.
An increase in weather related claims may put financial stress on some sectors of the insurance industry. In 2010, the National Association of Insurance Commissioners (NAIC) adopted a simple eight-question disclosure survey assessing the risk of potential-insurance-company insolvency resulting from climate change and related global warming.
⇧ Urban Infrastructure Renewal Priorities and the Public | Sustainable Cities Collective
Respondents said there was interest in sustainable infrastructure projects especially if they involve energy, such as setting energy efficiency standards for businesses. But just 26% said their city should focus on reducing water consumption.
Only 25% wanted to see more investment in reducing waste and improving recycling.
This means that cities must engage and educate their citizens more and gain their support about the environmental benefits of investing in recycling, water management, public transportation and similar topics.
We agree, and landlords have a direct stake in this, as their properties typically are in cities and their rents are only as good as the area.
⇧ BBC News – Can Denmark succeed where Switzerland failed?
Linda Yueh provides a good level of detail in her article, but here's the nutshell:
…Nordea Kredit, is reportedly paying mortgage holders to borrow money by charging a negative interest rate.
That may seem counter-intuitive, but we assure you that it's not.
We have long advocated an increase in the money supply in the US by even "paying" people to take money if necessary. We need the stimulus even now, even as there is so much talk about the Fed raising rates, which we say is vastly premature.
Exports are down due to the strong US dollar, creating more slack. Oil went down, but its feeling around for the right inventory levels and price.
Wages are still stuck. Labor participation is still low. The housing market and construction aren't really booming nationally; and what there is, isn't being built upon strong fundamentals (enough full-time, permanent, high-paying jobs).
⇧ The Pros and Cons of Seller Financing – Trulia's Blog
Balloon payments can be very risky. As the buyer, you'd want the right to sell the property before the balloon comes due. If the market is bad when you need to sell, you could lose all the gain you might have made and then some.
Rather than shoot for a balloon deal, you might want to talk about a 15-year deal with the right to seek other financing after a certain amount of time. The interest rate might have to be higher, but you'll be paying that higher rate to avoid not being able to come up with the balloon (principal balance).
Cutting out the middleman typically represents progress. Can you imagine depending on a telephone operator to put your call through? (Come to think of it, going through an operator might save us from making those calls we really shouldn't make.) But back to the point: Who wants to deal with a third party when you don't have to? That's part of the philosophy behind seller financing. There's a certain appeal to cutting out banks and mortgage lenders and having the seller finance the transaction — but there are risks involved. That said, both sellers and buyers can benefit. "Where else can you receive a rate of return in the 4 to 7% range with almost no risk?" asks Jesse Gonzalez, president of North Bay Capital Inc. "Your investment is backed by a tangible asset."
⇧ Fed's Preferred Inflation Measure Dives – Tim Duy's Fed Watch
Bottom Line: Below trend inflation as the economy nears full-employment is a very uncomfortable position for the Federal Reserve.
We disagree. The important number is inflation. So long as it remains low, the Fed should let unemployment go as low as it wants.
In addition, the Fed should get out of the habit of nearly always raising the rate by 25-50 basis points but rather be ready to slap it with 2-4 percentage points.
⇧ Federal Reserve Bank San Francisco | Persistent Overoptimism about Economic Growth |
Kevin J. Lansing and Benjamin Pyle:
Since 2007, Federal Open Market Committee participants have been persistently too optimistic about future U.S. economic growth. Real GDP growth forecasts have typically started high, but then are revised down over time as the incoming data continue to disappoint. Possible explanations for this pattern include missed warning signals about the buildup of imbalances before the crisis, overestimation of the efficacy of monetary policy following a balance-sheet recession, and the natural tendency of forecasters to extrapolate from recent data.
That's a pattern they must break. They must stop planning to raise rates too soon. They tapered too soon and too quickly once they started. They should have focused on getting banks to lend to the real economy. They should have raised the roof to get Congress to stimulate more and more and more until we were humming along, which we are not yet doing.
⇧ Campaign to audit the US Federal Reserve gathers pace – FT.com
We're very progressive around here but know that the Democrats are being had by usurers. Monetarism is not a good method. Auditing the Fed is a great place to begin that discussion.
Progressives needlessly fear that the libertarians would win the ultimate debate, were it had. The facts are that the Federal Reserve System should not have been created and it is very anti-progressive.
⇧ Sharp and sustained rise in suicides in Greece linked to austerity measures | EurekAlert! Science News
While Germany fiddles, Greece burns. Greeks are dying, and Germany could easily stop it:
Suicides in Greece reached a 30 year all-time high in 2012, with a sustained upward trend starting in June 2011, the month that the government introduced further austerity measures to help pay down the country's debts, reveals a 30 year study, published in the online journal BMJ Open.
Austerity events, all of which occurred between 2008 and 2012, began with the Greek recession in 2008, through a series of financial bail-out packages, riots, strikes and protests, and the public suicide of a Greek pensioner in the main square of Athens in response to austerity conditions.
Between 1983 and 2012, 11,505 people took their own lives–9079 men and 2426 women.
The introduction of austerity measures in June 2011 marked the start of a significant, sharp, and sustained increase in suicides, to reach a peak in 2012, the figures showed.
"Despite historically having one of the lowest suicide rates in the world, Greece is thought to have been more affected by the global financial downturn than any other European country," write the researchers.
High unemployment, household debt, comprehensive welfare and benefit cuts, and increasing homelessness prompted by the unrelenting and sizeable economic downturn in Greece are likely to have piled on the stress and created a sense of hopelessness, they say.
⇧ Nonresidential Construction Spending Expands in December
"Despite the slight expansion indicated in today's report, nonresidential construction lost some of its momentum during the final two months of 2014; however, this should represent only a minor dip in the industry's momentum headed into 2015," said Associated Builders and Contractors Chief Economist Anirban Basu. "It is possible that the past two spending reports indicate the U.S. economy is not as robust as many analysts believe….
⇧ Company maintains top priority is safety, integrity of oil pipelines; US regulators critical | Star Tribune
Landlords should be aware of risks in areas around their properties.
The Wyoming company whose pipeline leaked 30,000 gallons of crude oil into the Yellowstone River in Montana and its sister company have had multiple pipeline spills and federal fines levied against them in the last decade, according to government records.
⇧ MARISSA: 'Devastating': Marissa museum burns as town's fire count climbs | Metro-east news | News Democrat
Town leaders say Marissa lost part of its heart when a fire — possibly another arson — destroyed a 124-year-old former schoolhouse that served as the local historical society's museum.X
⇧ COGCC has a plan for future earthquakes | GreeleyTribune.com
The Colorado Oil and Gas Conservation Commission now has a plan for future earthquakes after two small quakes rattled an area in Weld County that officials later determined were likely caused by a nearby injection well.
Injection wells are used to dispose of wastewater produced from drilling activity. Companies inject the wastewater into the wells, which are typically much deeper than those drilled for oil and gas. If there are faults or fissures underground, the water can fill the fissure and act as a lubricant, which can lead to shifting that causes earthquakes.
⇧ Did Switzerland Spark the Next Mortgage Crisis? – The Atlantic
Ominously, one regional government has gained a huge boost of prestige as a result of the crisis: Viktor Orban's in Hungary. After all its other debt-relief measures failed, Orban's regime in the fall of 2014 ordered all mortgage lenders in Hungary to convert their Swiss-franc loans into Hungarian forints. This high-handed measure imposed heavy losses on the banks, which Orban shrugged off. Hungary's banking sector is heavily foreign-owned, and the ultra-nationalist leader has little sympathy for foreign business, especially financial business. Orban's central bank chief sent a blunt message to the Austrian, Italian, and Belgian banks that dominate the local market: We have too many banks here anyway. Orban explicitly rejects the idea of "liberal democracy," identifying Russia, Turkey, and China as more successful models for ambitious nations. After the events of January, his example may look more creditable to Europeans in search of escape from seemingly unending financial and economic crisis.
Everywhere in Europe, traditional modes of leadership and established institutions are unraveling. Last weekend, Greece elected a government that rejects EU-imposed austerity (a neo-Nazi party finished third). Marine Le Pen of the far-right, anti-EU National Front leads the polls in French presidential matchups. If the polls are accurate, almost half of all Italian voters support parties that are skeptical of or outright opposed to the European Union.
The last thing Europe needs is one more shove toward the ideological extremes. But thanks to its mortgage bankers, and the unintended consequences of Swiss monetary policy, it may have just received another.
We disagree. Europe definitely needs to head away from austerity. Of course, we prefer the leftward direction in doing that.
You'll note that David focused on the fear of the right. He didn't mention it's the center-left that came to power in Greece or that it's the populist-left that is looking strong in Spain.
⇧ Lack Of Reform, Not Austerity, Doomed Greek Economy – Investors.com
Alvaro Vargas Llosa doesn't want anarchistic capitalism (is there any other kind) blamed for austerity, but he turns around and indirectly blames the welfare state for it.
Let's be clear. The welfare state didn't cause the crash or austerity. It was deregulation and corporate cronyism (rent seeking/regulatory capture) in the US that did.
Furthermore, Syriza is not far-left, far from it. It is center-left.
⇧ S&P paying $1.38B to settle crisis-era charges
Standard & Poor's is paying about $1.38 billion to settle government allegations that it knowingly inflated its ratings of risky mortgage investments that helped trigger the financial crisis.
The three big rating agencies – S&P, Moody's Investors Service and Fitch Ratings – have been blamed for helping fuel the 2008 crisis by giving high ratings to high-risk mortgage securities. The high ratings made it possible for banks to sell trillions of dollars' worth of those securities. Some investors, such as pension funds, can only buy securities that carry high credit ratings.
S&P disputed the government's allegations when the federal suit was filed, calling the legal action "meritless" and the claims "simply not true." The company insisted its ratings were based on a good-faith assessment of the performance of home mortgages during a time of market turmoil.
Insiders reported that S&P was rubber stamping toxic securities as AAA grade.
⇧ Dahr Jamail | Species Extinctions, Human Chronic Disease on the Rise, as Climate Disruption Mounts
If you've never read about Global Warming, this is quite an article that should get you started understanding the magnitude of the problem.
I'm graced to live adjacent to Olympic National Park and have it as my backyard sanctuary.
Recently, I hiked up to an alpine lake at 5,000 feet, where my friend John and I pitched camp and settled in to climb a nearby peak. The clear, rarified air wafting through sub-alpine fir expands the soul, not to mention the power of the incredible mountain views.
But the trip, fantastic weather and summit aside, had a bittersweet edge to it.
We are at high latitude in upper Washington State, relative to the rest of the contiguous 48 states. The trip was in late January, and on the climb we were well over one mile above sea level, but we never saw the temperature drop below freezing, even at night. Large areas of our route up the peak found us slogging up scree slopes bare of snow, when normally the basin we were in would have required the use of avalanche transceivers and other precautions for traveling in heavy snow on steep slopes.
We called it June-uary up here.
⇧ What business would boost home prices in your community? | 89.3 KPCC
Starbucks, Whole Foods, Trader Joe's, Ralphs, Target, and good schools, are those things what you want nearby where you live?
Being also interested in risk management, we think about fire stations and well-staffed emergency rooms, among many other things.
⇧ Biggest price reductions in Houston real estate – Houston Chronicle
What fracking built and is now selling off:
Take a look at the homes above, which have all seen a price reduction of over 25 percent in and around Houston.
⇧ Asbury Park cracks down on vacant properties
ASBURY PARK — A citywide crackdown on vacant properties advances this month when officials notify the owners of at least 45 homes and structures considered blighted or troubled for other reasons.
The notices will be the culmination of a four-month initiative dedicated to investigating and compiling a list of properties that qualify for city action under the Abandoned Property Rehabilitation Act, said Robert McKeon, director of code enforcement for Asbury Park.
⇧ Australia's inflated housing market just got a extra burst of hot air – Quartz
It's not just the growth in prices that's a problem. Australian household debt as a percentage of disposable income is now running at over 150%, an all-time high. The IMF ranks Australia as having the second highest house price-to-income ratio in the world, and a Deutsche Bank survey of OECD countries estimates that Australian property prices are 49% overvalued.
"Australia's housing market is a classic pyramid or Ponzi scheme like the ones we previously saw in Ireland, the USA and Spain, and the RBA lowering rates is only going to add fuel to the fire," said Philip Soos, a researcher at Australia's Deakin University.
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