News: Real Estate, Risk, Economics. Oct. 20, 2015

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Table of Contents
(Click to sections below.)

1) Tackling London's housing crisis | FT World – YouTube

2) Property prices in Sydney, Melbourne: RBA sees signs of cooling

3) Condo, home prices slip as market frenzy cools (Video) – San Francisco Business Times

4) Proposal would prohibit rent hikes on dilapidated properties — Capitol Hill building eyed | CHS Capitol Hill Seattle

5) County housing market cooled in September | The Columbian

6) Dollar supported by US inflation data, ECB easing expectations | Reuters

7) No Rain Coming as Texas Wildfire Scorches Dry, Hard-Hit Area – ABC News

8) Biggest Real Estate Projects NYC, One Vanderbilt

9) California adds just 8,200 net jobs in September — much less than recent gains – LA Times

10) US Will Require Drones to Be Registered – NBC News

11) 9 questions about Denmark, Bernie Sanders's favorite socialist utopia – Vox

12) State shuts 33 wells injecting oil wastewater into aquifers – SFGate

13) Seattle landlord gives tenants a $200 discount for being vegetarian

14) Neil Kinnock: David Cameron will be forced out like Thatcher if he goes ahead with 'cruel' tax credit cuts | The Independent

15) Production at US Manufacturers Falls for a Second Month – Bloomberg Business

16) Tampa Bay area still leads nation in institutional investor real estate purchases | TBOcom and The Tampa Tribune

17) Coppola Comment: The Slough of Despond

18) Structural Reform Beyond Glass-Steagall | Next New Deal

19) Pro-Growth is Not Pro-Poor by Steven J. Klees – Project Syndicate

20) Which countries work the shortest hours — yet still prosper? – Agenda – The World Economic Forum

21) Flood victims turn to North Charleston insurance event for help – Post and Courier

22) Calculated Risk: LA area Port Traffic declined in September

23) Poll shows China's exporters downcast as orders slow, costs rise | Reuters

24) The End of German Hegemony by Daniel Gros – Project Syndicate

25) Will Technology Kill Convergence? by Kemal Dervis – Project Syndicate

26) US Bancorp sends a caution signal on commercial real estate – StarTribunecom

27) US Real Estate Statistics & Foreclosure Trends Summary | RealtyTrac

28) Sequoia Capital's Michael Moritz on 'subprime unicorns' – Business Insider

29) Tight Office Demand to Continue Through Mid-2016, New Research Reports Promise

30) Confidence Rises During the First Half of the Year

31) Producer Price Index News Release text

32) John McDonnell and the Fiscal Charter — Prime Economics

33) Federal Reserve Bank of San Francisco | Economic Research | FedViews: October 8, 2015

34) Democrats, Republicans and Wall Street Tycoons – The New York Times

35) The Financial Crisis: Lessons for the Next One | Center on Budget and Policy Priorities

36) mainly macro: The fiscal charter media fiasco

37) Two Arrested on Arson Charges Including a Town Selectman

38) 5 fires at one house lead to insurance fraud claim against couple | MLivecom

39) Conn. Warns Insurers Not to Terminate Home Policies Over Foundation Problems

40) Gains Made on Wyoming Wildfire That's Destroyed Dozen-plus Structures

41) Insurers in Massive California Fires Agree to Claim Handling Reforms

42) Climate Change Means Wildfire Seasons May Continue: Professor

43) 40 Structures Burned so Far in Central Texas Fires

44) Florida Man Arrested For Stealing Nearly $100,000 From Elderly Hurricane Sandy Victim

45) INDIAN HARBOR INSURANCE CO v. EQUIPMENT LTD | FindLaw

46) Explaining recent declines in labour's share in US income | VOX, CEPR's Policy Portal

47) Danish Doldrums – The New York Times

48) [REMOVED]

49) The Investor's 7-Point Checklist to Prepare Rentals for Winter

50) 5 Items to Replace or Upgrade in Every Rental Property You Buy

51) CapEx: How to Estimate Real Estate Capital Expenditures

52) UPDATE 1-China Sept inflation cooler than expected, producer prices extend slump | Reuters

53) I didn't think TTIP could get any scarier, but then I spoke to the EU official in charge of it | Voices | The Independent

54) #DeutscheBank full of holes – Beppe Grillo's Blog

55) Half of world's wealth now in hands of 1% of population — report | Money | The Guardian

56) The greatest American debt selloff in 15 years

57) Inequality to drive 'massive policy shift,' BofA's Michael Hartnett says

58) UK Banks May Need $5.1 Billion of Capital for Ring-fencing – Bloomberg Business

59) The last 30 years of global economic history are about to go out the window – Quartz

60) Good News Is Bad News for China – Bloomberg View

61) Guest post: What Chinese rebalancing? Cash flow edition | FT Alphaville

62) Party time is over for Norway's oil capital – and the country | Reuters

63) The truth behind China's manipulated economic numbers – Telegraph

64) China's GDP Growth Beats Forecasts as Stimulus Supports Spending – Bloomberg Business

65) How Not to Fix Fannie and Freddie – Bloomberg View

66) Worldwide real estate asset growth spectacular again – Pensions & Investments

67) Is the US Economy Close to a Bust?

68) Hard choices: How to pick a health insurance plan that works for you | Local News | lancasteronlinecom

69) The Japan Syndrome Comes to China by Jeffrey D. Sachs – Project Syndicate

70) This 20-Second Video Summarizes 35 Years of the World's Economy

71) Despite Threats, Affordable Sector is Thriving – YouTube

72) What a Justin Trudeau Win Means for Canada | TIME

73) Blackstone Leads Deal to Buy Stuy Town Complex – NASDAQcom

74) Capital Gazette – The flip side: Anne Arundel residents give real estate rehab a try

75) New heat for Southeast Michigan's housing market: Sales, prices hit 10-year highs – Crain's Detroit Business

76) Calculated Risk: Ornithology: What is a "deficit hawk"?

77) Something Not Rotten in Denmark – The New York Times

78) Britain's love affair with China comes at a price – Telegraph

79) Global Warming's Hurricane Tab in US: $14 Billion and Counting – Bloomberg Business

80) Homeowners Build Home Designed to Withstand Wildfires

81) Wapello woman facing arson charge | KCRG-TV9 | Cedar Rapids, Iowa

  1.    Tackling London's housing crisis | FT World – YouTube

    Interesting video:

    London is experiencing the biggest housing crisis since the Victorian era. The FT's Kate Allen explores how foreign investment and the city's growing population have contributed to the crisis, and how mayor Boris Johnson has tried to tackle it.

    Add your comment.


  2.    Property prices in Sydney, Melbourne: RBA sees signs of cooling

    Australia:

    Regulators have found some lending standards had actually been looser than first thought, increasing the risks of a downturn in the residential market, the RBA said.

    "As a result, some borrowers have had less of a safety margin against unexpected falls in income, increases in expenses or increases in interest rates," the bank said.

    Ya think?

    Add your comment.


  3.    Condo, home prices slip as market frenzy cools (Video) – San Francisco Business Times

    The "wealth effect" in reverse; well, flattening out a bit:

    Glenn Kelman, CEO of online real estate brokerage Redfin, said he was already seeing homes get fewer offers because many Bay Area residents "pay for houses with stock, so that willingness to bid $300,000 over asking is being limited by the stock market."

    Add your comment.


  4.    Proposal would prohibit rent hikes on dilapidated properties — Capitol Hill building eyed | CHS Capitol Hill Seattle

    Wednesday at City Hall, Seattle City Council members and frequent collaborators Nick Licata and Kshama Sawant announced legislation that would prevent landlords from raising rents by 10% or more on units that have unaddressed housing code violations. While far from a broad application, the move could represent Seattle's first step around statewide limits on rent control following a resolution to challenge the ban.

    Developer lobbyist Roger Valdez is against the proposal.

    "What the council members have proposed is a vicious circle in which the council members kick in the door and put in what essentially amounts to rent control," Valdez told CHS. "This is political micromanagement, and bad micromanagement of an industry which is generally very responsive to the needs of tenants … sometimes you have bad actors who let places [properties] fall apart. But the upside of that for tenants is that they get cheap rent."

    Valdez said that he thinks the city should create a program to subsidize landlords who want to conduct maintenance in order to keep rents low for tenants.

    All landlords who keep their properties up to code should back the measure. Their competition violates code and still raises the rent. Think about it.

    The measure could be in place even while landlords are subsidized for providing affordable housing.

    The problem right now with subsidized housing is that there isn't enough money being granted for such.

    That's where monetary reform comes into play.

    Add your comment.


  5.    County housing market cooled in September | The Columbian

    "Clark County is included in the Portland-Vancouver-Hillsboro, OR-WA Metropolitan Statistical Area." (https://en.wikipedia.org/wiki/Clark_Cou nty,_Washington)

    Clark County's real estate market cooled in September, with declines in pending and closed sales and a sharp 14.7 percent drop in new listings, according to the latest Market Action report from RMLS, the Portland-based real estate listing service.

    Still, the inventory of homes for sale remains at a level low enough to keep the strong seller's market alive in the county. The current supply of homes, including those proposed or under construction, would satisfy market demand for just 2.7 months, RMLS reported. That's well below the 4.5- to 6.5-month supply that real estate brokers say provides a healthy balance between supply and demand.

    Add your comment.


  6.    Dollar supported by U.S. inflation data, ECB easing expectations | Reuters

    Indicators out on Thursday showed a surprise 0.2 percent rise in the September U.S. core consumer price index, boosting the year-on-year gain to 1.9 percent and pushing it closer to the Federal Reserve's 2 percent goal.

    The Fed isn't using CPI, and they're watching the labor-participation rate and wage inflation, among other things.

    Add your comment.


  7.    No Rain Coming as Texas Wildfire Scorches Dry, Hard-Hit Area – ABC News

    A wildfire chewing the same Central Texas forestland scorched by a devastating blaze in 2011 slowed dramatically Thursday as improving weather kept the deadly destruction of four years ago at bay.

    No rain is in sight to extinguish the latest flare-up that has burned 6 square miles, wiped out roughly three dozen homes and threatened hundreds others.

    Add your comment.


  8.    Biggest Real Estate Projects NYC, One Vanderbilt

    This month, the big dogs barked loudest. September's largest permit applications were dominated by marquee projects from major developers, with SL Green's One Vanderbilt standing head and shoulders above the rest. The Chetrit Group and Somerset Partners' also made waves with a pair of residential buildings with a combined area exceeding a million square feet.

    Add your comment.


  9.    California adds just 8,200 net jobs in September — much less than recent gains – LA Times

    After months of robust job gains, California employers added just 8,200 net new jobs in September — a sluggish month that mirrored slower growth for the U.S. overall.

    Experts said the slow growth in California could be a byproduct of the same woes weighing on U.S. economic growth: turmoil in financial markets, along with an economic slowdown in China that has affected exports and the manufacturing sector.

    The news has raised the likelihood that the Federal Reserve will hold off on raising a key interest rate this year to avoid any further slowdown in the economy.

    Add your comment.


  10.    U.S. Will Require Drones to Be Registered – NBC News

    The federal government will announce a new plan requiring anyone buying a drone to register the device with the U.S. Department of Transportation….

    Add your comment.


  11.    9 questions about Denmark, Bernie Sanders's favorite socialist utopia – Vox

    Denmark is able to deliver superior public services because it is willing to spend more money (you can't have a paid parental leave program without someone footing the bill, for example) the causation also goes in the other direction. Danish political economy places a greater emphasis on identifying and eliminating waste, which both improves the quality of public services and fosters greater willingness to pay for them. The United States is in a different political equilibrium where the service providers themselves are often the key political constituency for services, which makes it difficult to focus on cost-effectiveness, while conservatives prefer eliminating programs to trying to improve them.

    Add your comment.


  12.    State shuts 33 wells injecting oil wastewater into aquifers – SFGate

    The division has identified 178 wells that were injecting into legally protected aquifers with relatively high water quality, defined as those with a maximum of 3,000 parts per million of total dissolved solids. More than 2,000 other wells inject into aquifers that would be harder to use for drinking water, either because they are too salty or because they also contain oil.

    Add your comment.


  13.    Seattle landlord gives tenants a $200 discount for being vegetarian

    Jinesh Varia doesn't eat meat, and he's currently landlord for a (by all appearances) lovely townhouse he's renting out in a Seattle suburb. According to a report by K5 News, Varia will be offering tenants a $200 monthly discount if they stick to a vegan or vegetarian diet.

    Add your comment.


  14.    Neil Kinnock: David Cameron will be forced out like Thatcher if he goes ahead with 'cruel' tax credit cuts | UK Politics | News | The Independent

    "The coming huge cut in working tax credits without other income safeguards will be devastating for millions of workers' families – and, because it will hit consumer demand and increase dependence on household borrowing, it is manifestly inefficient as well as profoundly unjust." Lord Kinnock? said.?

    Add your comment.


  15.    Production at U.S. Manufacturers Falls for a Second Month – Bloomberg Business

    "Manufacturing continues to be kind of soft," said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York. "It's a combination of weak foreign demand and inventories getting rebalanced. I'd expect another few months of flat-to-down manufacturing output."

    Add your comment.


  16.    Tampa Bay area still leads nation in institutional investor real estate purchases | TBO.com and The Tampa Tribune

    The Tampa metro area continues to hold the top spot in the nation for institutional investor real estate purchases, despite a dramatic drop in such sales over the past couple of years.

    Add your comment.


  17.    Coppola Comment: The Slough of Despond

    Frances Coppola appears to not comprehend some fundamentals for some reason.

    Restoring Glass-Steagall isn't about solving something in the sense she means it. It's about helping to prevent a repeat of what happened. Yes, deregulation, including breaking Glass-Steagall definitely contributed in a huge way to the Great Recession!

    "… banks can't "just lend" without any form of funding," Frances states. Which banks, Frances? Central banks certainly can, and regular commercial banks also can (provided they remain solvent under reserve-ratio requirements). They borrow to remain liquid. You know though that central banks/treasuries of nations that issue their own currency do not have to borrow anything from any entity, ever. So, why should they? Why pay interest and cause inflation when it's not required?

    Why do so many people want "full-reserve" banking only? That's easy. They want fundamental fairness and see that banking executives get to create credit by the tens and hundreds of billions of dollars/pounds upon which those execs earn interest and fees, etc. It's a class thing/struggle, Frances.

    Those bankers are bailed out, don't go to prison for massive fraud, and only further consolidate the industry. It's a moral hazard.

    Then there's the issue of negative rates. The object there is to encourage spending to stimulate the economy. It's really a last-ditch effort because governments haven't been willing to democratize the monetary system but have rather left it in the hands of the banking elite.

    It seems to me, Frances, that you have one foot in and one foot out of the progressive circle. I suggest you step in with both feet.

    Add your comment.


  18.    Structural Reform Beyond Glass-Steagall | Next New Deal

    I have no problem with the vast majority of what Mike has written. I agree that Glass-Steagall, per se, couldn't have prevented the problem. I've always argued that the problem was with reckless deregulation in general, part of which included breaking Glass-Steagall.

    Reinstating GS, as Mike refers to it, would be a statement that ending it in the first place was a bad idea (which it was).

    Here's the thing. Reinstating it wouldn't cause any harm whatsoever and it wouldn't, and shouldn't, prevent instituting other regulations and breaking up investment banks that are too large.

    Reinstating GS would allow for the cleaner, clearer recognition of entities during downturns and crises (if we have any). The deposit banks would be FDIC protected and more manageable. The investment banks would be "swim at your own risk"/no bailouts at all. That's capitalism.

    Why was Goldman Sachs allowed to quickly become a regular bank right after the crisis hit if the blending didn't bailout their investment/proprietary-trading side? Why let them stay blended if smaller?

    No, I like the firewall concept: a nice, strong firewall with no oily rags allowed just because the deposit bank/speculative entity is smaller.

    Add your comment.


  19.    Pro-Growth is Not Pro-Poor by Steven J. Klees – Project Syndicate

    A new focus on inequality — most notably by Thomas Piketty — has helped stimulate a resurgence of economic thinking like that advocated by Joseph Stiglitz, Anthony Atkinson, Paul Krugman, and Robert Solow. Many are now arguing not only that economic growth does not in itself reduce poverty and inequality, but also that pro-equity policies and conditions lead to faster and better economic growth.

    Indeed, some economists now argue for a two-pronged attack on inequality: redistributive measures alongside market interventions to bolster wages and employment. Among the recommended policies are progressive income taxes, increases in capital gains taxes, higher estate taxes, and global mechanisms to tax income, wealth, and financial transactions. Governments could also facilitate unionization to give workers more bargaining power, substantially raise minimum wages, and create employment, for example, through government jobs programs, as the United States did during the 1930s.

    All but that last one are really designed to save capitalism from itself via social democracy.

    What we really need is democracy: economic democracy.

    Frankly, there's no such thing as democratic capitalism. There's democratic socialism though. It's not Marxism-Leninism-Stalinism. It's not Trotskyism.

    The general public typically doesn't understand the distinctions and confuses ownership and possession as one and the same.

    Regardless, the degree of public versus private ownership should be democratically decided, which would preclude money "buying" anything in the debate and decision-making process. Therefore, the system would have to be extremely democratic right from the start (something we've never had).

    Add your comment.


  20.    Which countries work the shortest hours — yet still prosper? – Agenda – The World Economic Forum

    Aside from Sweden and Germany, there are two other countries that paradoxically excel in both prosperity and leisure time: the Netherlands, which comes fifth for competitiveness and yet third for the shortest working hours in the world, and Switzerland, which has been crowned the most competitive country in the world.

    Switzerland tops the Global Competitiveness Report for the seventh year running. This is in spite of putting in a mere 1,576 office hours annually per person, which places it at number eight in the OECD's list of countries with the shortest working weeks.

    Add your comment.


  21.    Flood victims turn to North Charleston insurance event for help – Post and Courier

    "A lot of the damage that we've seen is damage to homes, and if you're not in a low-lying area, chances are you may not have flood insurance," he said.

    Add your comment.


  22.    Calculated Risk: LA area Port Traffic declined in September

    Container traffic gives us an idea about the volume of goods being exported and imported – and usually some hints about the trade report since LA area ports handle about 40% of the nation's container port traffic.

    Add your comment.


  23.    Poll shows China's exporters downcast as orders slow, costs rise | Reuters

    China's dominance as an exporter has been undermined by its previously strengthening currency, soaring labor costs, and a strategic shift by the authorities away from an excessive reliance on exports to domestic consumption.

    A mild devaluation of the yuan in August was seen by some Chinese exporters as providing some respite, as their price competitiveness had been eroded during the past few years.

    Add your comment.


  24.    The End of German Hegemony by Daniel Gros – Project Syndicate

    Germany, which exports a large volume of investment goods, benefited more than other eurozone member countries from the investment boom in China and other emerging economies. But emerging-economy growth is now slowing considerably, including in China, where demand is shifting from investment toward consumption.

    Add your comment.


  25.    Will Technology Kill Convergence? by Kemal Dervis – Project Syndicate

    … a fourth mechanism at work, related to the changing — and seriously disruptive — nature of new technologies. A major driver of past catch-up, if only in terms of incremental growth, was the shift of many activities in both the services and manufacturing sectors from advanced economies to developing countries with lower wages.

    Now, however, a growing array of activities can be automated. And coding-supported products often have lower costs per unit of output than even very cheap labor can provide. So, whereas call centers, for example, used to be mostly staffed in low-wage countries, now the computer-robot that does most of the talking can be located in New York.

    Add your comment.


  26.    U.S. Bancorp sends a caution signal on commercial real estate – StarTribune.com

    When the company announced its third quarter results on Thursday, Chief Executive Richard Davis told analysts and investors that it is trying to hold a line on growth in commercial real estate.

    Add your comment.


  27.    U.S. Real Estate Statistics & Foreclosure Trends Summary | RealtyTrac

    There are currently 864,610 properties in U.S. that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 1,328,282.

    Add your comment.


  28.    Sequoia Capital's Michael Moritz on 'subprime unicorns' – Business Insider

    Chronically low interest rates have driven more and more money into venture capital investment, pushing valuations higher and higher. Fortune's Dan Primack wrote recently that "the sentiment is fear" in Silicon Valley right now.

    Moritz makes pretty clear he thinks we are in a bubble — the choice of "subprime" to describe the investments should set alarm bells ringing for the 2008 property crisis that engulfed the US.

    And, of course, so much real-estate high valuation is based on high-tech firms and their highly paid employees.

    Add your comment.


  29.    Tight Office Demand to Continue Through Mid-2016, New Research Reports Promise

    The office tenant base is growing faster than new development can keep up with, forcing the national office vacancy down in the third quarter to its lowest point since the recession and pushing up rental rates.

    Add your comment.


  30.    Confidence Rises During the First Half of the Year

    "While the decline in commodity prices has helped to slow construction in parts of the country, including in portions of Texas, Oklahoma and North Dakota, low fuel prices have induced faster investment elsewhere, including in the U.S. auto industry," said Basu. "The result appears to be that the average construction decision maker is more confident than six months ago when commodity prices were higher. A stronger U.S. dollar has served to suppress U.S. export growth, however, and business investment growth remains mediocre by historic standards. The implication is that the U.S. economy is not poised to break out anytime soon, and that stakeholders can continue to expect frustratingly unexceptional growth close to 2 to 2.5 percent."

    Add your comment.


  31.    Producer Price Index News Release text

    PRODUCER PRICE INDEXES – SEPTEMBER 2015

    The Producer Price Index for final demand declined 0.5 percent in September, seasonally
    adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices were
    unchanged in August and rose 0.2 percent in July. On an unadjusted basis, the final demand
    index fell 1.1 percent for the 12 months ended in September, the eighth straight 12-month
    decline.

    That's disinflationary. The strong dollar and low oil prices have had a great deal to do with it. Inventories have been high but will fall over the coming months. If the Fed doesn't raise rates, the dollar will weaken, commodity prices will rise, and US manufacturing will be more competitive globally.

    Add your comment.


  32.    John McDonnell and the Fiscal Charter — Prime Economics

    …most economists — including those that "lashed Corbynomics" – believe that at times of private sector weakness, governments should compensate by expanding public spending. The reason is straightforward: government spending (unlike most household spending) generates its own income (in the form of tax revenues) and pays for itself.

    Third, interest rates on government bond sales are at historically unprecedented low levels. Locking in these low rates for thirty or fifty years is sound economics. It enables government to borrow for long periods of time at rates that are effectively negative, taking inflation into account. This borrowing — if invested in e.g. high speed broadband infrastructure — would provide a tremendous boost to the private sector, and deepen the recovery.

    However, there's no reason to borrow it. Just issue it. Why borrow? Borrowing makes no sense.

    Add your comment.


  33.    Federal Reserve Bank of San Francisco | Economic Research | FedViews: October 8, 2015

    Reuven Glick, group vice president at the Federal Reserve Bank of San Francisco, stated his views on the current economy and the outlook as of October 8, 2015.

    He's seeing all the data correctly, but his outlook is too optimistic. It should be neutral to negative.

    Add your comment.


  34.    Democrats, Republicans and Wall Street Tycoons – The New York Times

    Paul Krugman:

    To understand the politics of financial reform and regulation, we have to start by acknowledging that there was a time when Wall Street and Democrats got on just fine. Robert Rubin of Goldman Sachs became Bill Clinton's most influential economic official; big banks had plenty of political access; and the industry by and large got what it wanted, including repeal of Glass-Steagall.

    Why did they want that if reversing it now wouldn't help? Would they not fight reversing it? Aren't they fighting against reversing it by, among other things, claiming reversing wouldn't matter? Well, if it wouldn't matter, let's reverse it just in case it would help (tongue in cheek).

    Add your comment.


  35.    The Financial Crisis: Lessons for the Next One | Center on Budget and Policy Priorities

    Alan S. Blinder and Mark Zandi:

    • Policymakers should not respond to every financial event, but they should respond aggressively to potential crises — and the greater the uncertainty, the more policymakers should err on the side of a bigger response.
    • …
    • To minimize moral hazard, bailouts of companies should be avoided. If they are unavoidable, shareholders should take whatever losses the market doles out and creditors should be heavily penalized. Furthermore, taxpayers should ultimately be made financially whole and better communication with the public should be considered an integral part of any bailout operation.
    • Because fiscal and monetary policy interactions are large, policymakers should use a "two-handed" approach (monetary and fiscal) to fight recessions — and, if possible, they should select specific monetary and fiscal tools that reinforce each other.
    • …
    • Discretionary fiscal policy, which has been a standard way to fight recessions since the Great Depression, remains an effective way to do so, and the size of the stimulus should be proportionate to the magnitude of the expected decline in economic activity.
    • Policymakers should not move fiscal policy from stimulus to austerity until the financial system is clearly stable and the economy is enjoying self-sustaining growth.

    Those are purely Keynesian. We can do much better.

    Add your comment.


  36.    mainly macro: The fiscal charter media fiasco

    Simon Wren-Lewis:

    I have not come across a single non-partisan academic economist who supports this charter, and certainly not one who knows about this literature. For an academic discipline that is always accused of being hopelessly divided, that is saying something. The reasons are not that difficult to get across:

    The policy restricts public investment at just the time that public investment should be high because borrowing and labour are cheap. Its a near universal view among economists that now is the time for higher public investment.

    Well, it's always borrow, borrow, borrow. Why borrow? Do Keynesians have some mental blockage when it comes to governments issuing currency without borrowing? What's in it for them (the Keynesians)?

    Simon has mentioned debt-free money before, but he always reverts to ignoring it rather than sticking with it the way he should.

    Add your comment.


  37.    Two Arrested on Arson Charges Including a Town Selectman

    According to Fire Marshal Investigator, Jeremy Damren, the investigation began following a fire that destroyed a vacant single family home belonging to Morrison on Lake Road in Perry. According to Damren the house was burned to collect insurance proceeds.

    Add your comment.


  38.    5 fires at one house lead to insurance fraud claim against couple | MLive.com

    LOWELL, MI — It took five fires to finally burn down the house at 318 Lincoln Lake Ave. SE and now the owners of that home are charged with insurance fraud and lying to police.

    Add your comment.


  39.    Conn. Warns Insurers Not to Terminate Home Policies Over Foundation Problems

    The Connecticut Insurance Department:

    The Department said it expects that any non-renewal action taken by insurers be strictly in accordance with its underwriting guidelines and rules that are filed with and recorded effective by the Department.

    Add your comment.


  40.    Gains Made on Wyoming Wildfire That's Destroyed Dozen-plus Structures

    By fall, usually Wyoming has seen freezing temperatures and possibly even a significant snowfall.

    But, warmer temperatures have been drying out the prairie since early September.

    Add your comment.


  41.    Insurers in Massive California Fires Agree to Claim Handling Reforms

    Under this agreement, policyholders may receive advance payment for up to four months of additional living expenses, 25 percent of policy limits for personal property, and expedite the process for debris removal-a first step in rebuilding.

    Add your comment.


  42.    Climate Change Means Wildfire Seasons May Continue: Professor

    Temperatures can impact evaporation of water from the air and they can affect length of a fire season and when the snowpack melts, she said.

    "I think a lot of people underestimate the importance of warming temperatures alone," she said. "We're seeing more days with extreme heat."

    Add your comment.


  43.    40 Structures Burned so Far in Central Texas Fires

    The Hidden Pines fire has burned thousands of acres in and around Bastrop's two state parks and claimed 40 structures including many homes…

    "One thing that I will say is you must have insurance. My heart goes out to so many people who don't have insurance," Williams said.

    I agree about the insurance and the heart.

    Add your comment.


  44.    Florida Man Arrested For Stealing Nearly $100,000 From Elderly Hurricane Sandy Victim

    A Naples, Fla., man was arrested earlier this month for allegedly stealing two insurance claim payments totaling more than $96,000 from an elderly New Jersey business owner.

    Read the article, and then shake your head not only about anyone who would rip off an elderly man who just needed claims assistance but also that the alleged fraudster thought he could get away with it.

    Add your comment.


  45.    INDIAN HARBOR INSURANCE CO v. EQUIPMENT LTD | FindLaw

    Case opinion for US 3rd Circuit INDIAN HARBOR INSURANCE CO v. EQUIPMENT LTD:

    Because Indian Harbor did not offer a contract that is either the same or nearly the same as the Policy, it breached its promise to offer a renewal extension of coverage.

    One must read the renewal provisions in the policy because not all policies will leave such details unaddressed (especially now after this ruling).

    Add your comment.


  46.    Explaining recent declines in labour's share in US income | VOX, CEPR's Policy Portal

    Robert Z. Lawrence:

    In combination, these estimates of low substitution elasticities and declines in the effective capital-labour allow me to account for much of the decline in labour's share in the US sectors and industries (such as manufacturing, mining, and information technology) that are responsible for most of the decline in labour's share in income.
    Important differences in policy implications

    The policy implications of this alternative explanation are profoundly different from those advocated by Piketty. Piketty advocates taxing capital. But if s is < 1, increasing taxes on capital could lead to further reductions in labour's share! Paradoxically, with s < 1, policies that increase investment and the supply of capital could achieve more equal distributions of income. Accordingly lower taxes on capital and a progressive consumption tax could be the most effective approach to boosting investment and reducing US income inequality.

    No, no, no. That's not right.

    Capital is buying automation. Labor is going to lose share no matter what. A progressive consumption tax isn't going to help unless there's redistribution of wealth and income as a direct result, which is far from certain given the current state of affairs: plutocracy.

    The whole interest (usury) and tax thing is obsolete. The entire model needs to be replaced by debt-free currency and democracy that is as direct as practicable (and it's very practical given the problem of absorbing people into the workforce; they all would have more time for democracy/decision-making were hours spread out evenly).

    Add your comment.


  47.    Danish Doldrums – The New York Times

    Excellent, pithy analysis from Paul Krugman:

    … Denmark is paying a high price for shadowing the euro — it hasn't joined, but it runs monetary policy as if it had — and also, for the past few years, for imposing a lot of fiscal austerity despite very low borrowing costs.

    None of this has much bearing on the welfare state issue: short-run macro policy is a different subject.

    Add your comment.


  48. [REMOVED]

  49.    The Investor's 7-Point Checklist to Prepare Rentals for Winter

    Nice list by Engelo Rumora:

    … before it's too late for preventive maintenance, you have some work to do. Here are a couple of things you can do to prepare your rental property for the coming winter season.

    Also, inform your tenants about how to handle deep freezes. They need to know about how to prevent water pipes from freezing and bursting (keeping the heat on above a certain temperature; allowing faucets to drip…). Send your tenants the info or hand it to them during your inspection. Document that you did it even if that means getting them to sign for it. Do your research. Read up on 1) insulating pipes, 2) automatic leak detection and water shutoff systems, and 3) insulating attic spaces to help prevent ice damming on the roof.

    Also, who's responsible for snow removal and what is the timing (how soon after a snowfall)? More areas are putting tough snow-removal laws into place. Some of them include the property owner's responsibility for clearing public sidewalks along the property.

    Then there are Christmas trees and other holiday decorations, which can present huge fire risks if handled carelessly.

    Don't forget firewood issues and space heaters (which are often precluded by insurance policies). The list goes on and on and on.

    Add your comment.


  50.    5 Items to Replace or Upgrade in Every Rental Property You Buy

    Another good list, this one by Che Chiu Wong:

    Here are the top 5 things you should seriously consider replacing or upgrading whenever you acquire a new investment property, regardless of their condition.

    All the suggestions … revolve around several major items: water, fire, electricity and safety.

    There are locks on the market that allow very easy re-keying.

    Your rental agreement should require your tenant to notify you in a timely manner of any leaking toilets, etc.

    The smoke and fire alarm suggestion is especially good! Make sure they are properly positioned inside the property. Your local fire department might even do a free property inspection for fire hazards, etc. They'd rather be doing those than responding to fully engulfed fires. You might even get a discount on alarm equipment.

    Be sure you stay within the requirements of your insurance policy too.

    Add your comment.


  51.    CapEx: How to Estimate Real Estate Capital Expenditures

    Brandon Turner:

    … CapEx is a much greater percentage of the income when dealing with lower-priced properties. On a home that rents for $2,000 per month, the CapEx of $200 per month is 10% of the income, but on a home that rents for $600 per month, the CapEx of $200 per month will be a whopping 30% of the rent.

    Of course, there are also tax implications. Capital expenditures can't be fully expensed in the tax year but need to be depreciated. Consult your tax attorney or accountant.

    Add your comment.


  52.    UPDATE 1-China Sept inflation cooler than expected, producer prices extend slump | Reuters

    Reflecting growing strains on Chinese companies from persistently weak demand and overcapacity, manufacturers continued to cut selling prices to win business.

    The producer price index(PPI) fell 5.9 percent from a year ago, in line with the expectations and the same rate of decline as in August, which was the biggest drop since the depths of the global financial crisis in 2009.

    Add your comment.


  53.    I didn't think TTIP could get any scarier, but then I spoke to the EU official in charge of it | Voices | The Independent

    This is what democracy does not look like:

    When put to her, Malmström acknowledged that a trade deal has never inspired such passionate and widespread opposition. Yet when I asked the trade commissioner how she could continue her persistent promotion of the deal in the face of such massive public opposition, her response came back icy cold: "I do not take my mandate from the European people."

    Therein lies the problem with the global-economic system.

    Add your comment.


  54.    #DeutscheBank full of holes – Beppe Grillo's Blog

    70 thousand billion in derivatives

    Details of the reasons for these losses are not yet available but it is well known that the bank has an anomalous concentration of derivatives in its portfolio: 75 thousand billion dollars [USD $75,000 billion = USD $75 trillion] (about 65 thousand billion euro!), equivalent to 20 times Germany's GDP. It seems that Deutsche Bank has really not learned much from the 2008 crisis, even though America's Securities Exchange Commission (SEC) in May of this year, penalised its structured finance dating back to the time of Lehman Brothers, with a fine of 55 million dollars.

    "55 million dollars" is chicken feed.

    Add your comment.


  55.    Half of world's wealth now in hands of 1% of population — report | Money | The Guardian

    Global inequality is growing, with half the world's wealth now in the hands of just 1% of the population, according to a new report.

    The middle classes have been squeezed at the expense of the very rich….

    That's mistaken wording. It hasn't been at the expense of the very rich. It should read: "The middle classes have been squeezed by the further enrichment of the already very rich." It hasn't cost the very rich a thing (except perhaps their souls, if they have any).

    Let's hope they do have souls and that they save them by changing away from their hyper-accumulation and rather share the wealth.

    Add your comment.


  56.    The greatest American debt selloff in 15 years

    … foreign private investors, like banks and financial institutions have stepped in.

    Still, the overall Treasury selloff shows that the air is finally coming out of the global savings glut.

    Add your comment.


  57.    Inequality to drive 'massive policy shift,' BofA's Michael Hartnett says

    Good reporting by Jeff Cox:

    "If the secular reality of deflation and inequality is intensified by recession and rising unemployment, investors should expect a massive policy shift in 2016," Hartnett said in a note to clients. "Seven years after the West went 'all-in' on QE and ZIRP, the U.S./Japan/Europe would shift toward fiscal stimulus via government spending on infrastructure or more aggressive income redistribution."

    Add your comment.


  58.    U.K. Banks May Need $5.1 Billion of Capital for Ring-fencing – Bloomberg Business

    Better than nothing but still not good enough:

    The U.K.'s largest banks may face higher capital requirements under Bank of England rules on the separation of retail operations from riskier investment banking.

    The BOE's Prudential Regulation Authority estimates that so-called ring-fencing could mean an additional capital requirement of 2.2 billion pounds ($3.4 billion) to 3.3 billion pounds by 2019, when the rules kick in.

    Add your comment.


  59.    The last 30 years of global economic history are about to go out the window – Quartz

    Exactly:

    Matt Phillips:

    This is a big problem for a whole bunch of reasons. But it's especially worrisome for investors who have, in recent years, lent a ton of hard currency—US dollars—to companies and governments in those countries by buying dollar-denominated bonds from them. As the currencies of these countries get weaker, it takes more and more reals—or ringgit or pesos or rands—to acquire the dollars needed to repay those bonds.

    Worried that they won't get paid back, people who hold those bonds have been selling them. That pushes up bond yields, which are the borrowing costs. For economies that are already struggling, higher borrowing costs are yet another blow.

    … China will be less of an aggressive buyer of US government securities. That's no small thing, as the country is the largest creditor to the US. In theory, the drop in demand for US debt could at some point make it more expensive for the US to borrow, though that isn't happening so far.

    But the broader point is that this marks a new phase for the global economy. For nearly 30 years, China has bulked up by digesting tons of commodities from the world's emerging markets and turned them into exports, and in the process has become a key creditor to the world's largest consumer economy, the United States. All of that is changing now, and nobody is quite sure how it will play out.

    Add your comment.


  60.    Good News Is Bad News for China – Bloomberg View

    Debt has risen to astronomical levels. The growth model China used during its hyper-charged decades — unleashing productivity by tossing its 1.3 billion poor workers into the global supply chain — has lost steam as costs rise and the workforce ages.

    Economist Christopher Balding has done some crack research pointing out that the service sector isn't expanding as quickly as the bulls believe.

    Add your comment.


  61.    Guest post: What Chinese rebalancing? Cash flow edition | FT Alphaville

    Very illuminating stuff:

    "Christopher Balding, Professor of Economics at Peking University, HSBC Business School, and blogger at Balding's World":

    If we begin by using the simple metric of revenue share by industrial classification, the Chinese economy is only slightly more balanced than it was five years ago.*

    At the end of the second quarter in 2010, new economy industries comprised 13.7 per cent of operating revenue for listed companies. While at the end of the second quarter in 2015, new economy industries comprised 15.4 per cent of revenue for listed companies. Even just one year earlier in 2014, new economy firms in China comprised 14.7 per cent of operating revenue. If we focus on the cash flow within the economy, the rebalancing is incredibly weak at best.

    To illustrate the difficulty of rebalancing the Chinese economy with this magnitude of economic weighting, the 3.9 per cent decline in old industry revenue was sixteen times larger in absolute terms than the 1.4 per cent increase in new industries. The old industry revenue decline will have an oversize impact on employment, tax revenue, and debt servicing ability. The legacy industries will continue to have an oversized impact on the entire economy and in any attempt to rebalance.

    Add your comment.


  62.    Party time is over for Norway's oil capital – and the country | Reuters

    In Norway's oil capital Stavanger, house prices are falling, unemployment is rising and orders of champagne and sushi sprinkled with gold are down – a taste of things to come for the rest of the country as slumping crude prices hit the economy.

    Add your comment.


  63.    The truth behind China's manipulated economic numbers – Telegraph

    Rather optimistic, considering:

    Capital Economics – a London-based research firm – has been collecting its own series of indicators, dubbed the China Activity Proxy, since 2009.

    Despite showing a sharp downturn at the start of the year – where GDP collapsed to around 4pc – it provides a more sanguine assessment of recent developments.

    …. GDP is now expected to rebound to 4.5pc this year, followed by 6.5pc in 2016, calculate Capital Economics.

    Add your comment.


  64.    China's GDP Growth Beats Forecasts as Stimulus Supports Spending – Bloomberg Business

    Here's the "official" Chinese GDP report interpreted by Bloomberg.

    Add your comment.


  65.    How Not to Fix Fannie and Freddie – Bloomberg View

    Antonio Weiss:

    The recent push to recapitalize Fannie Mae and Freddie Mac and release them from conservatorship is misguided.

    Proponents of the "recap and release" proposal claim homeowners and taxpayers would benefit if the federal government ceded control of the mortgage finance giants to private shareholders.

    Just the opposite is true. Recap and release could raise the cost of mortgages for Americans, and potentially expose taxpayers to another painful bailout.

    Add your comment.


  66.    Worldwide real estate asset growth spectacular again – Pensions & Investments

    Arleen Jacobius:

    Real estate worldwide assets of the largest real estate money managers returned to a pre-crisis growth rate, up 20% for the 12 months ended June 30, buoyed by increased capital flows from foreign investors, Pensions & Investments' annual survey shows.

    Add your comment.


  67.    Is the US Economy Close to a Bust? |

    One thing that we cannot stress often enough is that the manufacturing sector is far more important to the economy than its contribution to GDP would suggest. Since GDP fails to count all business spending on intermediate goods, it simply ignores the bulk of the economy's production structure. However, this is precisely the part of the economy where the most activity actually takes place. The reality becomes clear when looking at gross output per industry: consumer spending at most amounts to 35-40% of economic activity. Manufacturing is in fact the largest sector of the economy in terms of output.

    Interesting bit, that; but then the article goes off on an Austrian School tangent completely ignoring the deregulation that caused the Great Recession.

    The fact there is "fiat" currency had nothing to do with it at all! Also, monetary inflation is just another way of saying money supply, a great deal of which money can simply be sitting still, as cash is a place many go when yield seeking is too risky. The Fed's huge balance sheet, for instance, didn't cause real inflation (price inflation), contrary to the expectations of the Austrians/Austerians. They claim there was asset inflation because some people ran up the stock markets. However, that's hardly the same thing.

    Add your comment.


  68.    Hard choices: How to pick a health insurance plan that works for you | Local News | lancasteronline.com

    … experts recommend that sites include a total cost estimator that asks people how many times they expect to visit a doctor and what medications they take, then helps them estimate their probable total and out-of-pocket costs for various plans.

    Healthcare.gov, which starts its third open enrollment season on Nov. 1, will include that tool for the first time this year, Wong said.

    Add your comment.


  69.    The Japan Syndrome Comes to China by Jeffrey D. Sachs – Project Syndicate

    Jeffrey Sachs:

    Earlier this year, The Economist offered the conventional Western thinking. Don't let the renminbi depreciate, it wrote, for four reasons: depreciation might provoke a currency war in Asia; China's companies are awash in dollar-denominated debt; depreciation might lead to renewed US charges of currency manipulation; and depreciation might reverse China's progress in making the renminbi an international reserve currency.

    Such misguided reasoning is precisely what led to a generation of unnecessarily slow growth in Japan. It could happen again in China.

    Add your comment.


  70.    This 20-Second Video Summarizes 35 Years of the World's Economy

    A lot has happened to the global economy over the last 35 years. The forces of economic liberalization, globalization, and the rise of the multinational corporation have all left their mark. Many countries have benefited over this period, but some have suffered. Others have not really changed much in terms of their global economic position.

    Add your comment.


  71.    Despite Threats, Affordable Sector is Thriving – YouTube

    Ava Goldman, President of The Michaels Development Company, expresses her thoughts and concerns about the affordable apartment industry. Business is exceptionally good, but there are many threats that would be devastating to affordable housing developers. Constant vigilance is a must.

    Add your comment.


  72.    What a Justin Trudeau Win Means for Canada | TIME

    The Liberals have said that they would accept a series of budget deficits to fund major infrastructure spending that would in turn boost the economy. This differs greatly from the Conservative and NDP platforms, both of which promised balanced budgets. Trudeau justifies this policy by arguing that the weakened Canadian economy, currently in a recession, needs stimulus now and that additional deficits, estimated at $10 billion annually, would have a marginal impact as economic outlooks improve. …

    The Liberals also promised a tax hike for Canada's top 1% to pay for a tax cut for the country's middle class. It means that anyone who earns over $200,000 would see a tax hike of around 4%, while those earning between $44,701 and $89,401 would see a cut of around 1.5%, according to the Globe and Mail.

    Those are right moves for small reforms. I should think that the oil era being over (at least for the foreseeable future) is what mainly sunk Harper.

    Add your comment.


  73.    Blackstone Leads Deal to Buy Stuy Town Complex – NASDAQ.com

    Stuyvesant Town and Peter Cooper Village, a sprawling collection of 11,200 apartments that rode the boom and bust of the real-estate cycle, is set to be sold to Blackstone Group LP and another large investor for about $5.3 billion, people familiar with the matter said.

    It's an interesting article for the affordable-housing-issue content, among other details.

    Add your comment.


  74.    Capital Gazette – The flip side: Anne Arundel residents give real estate rehab a try

    Steve Pajowski quit his engineering job five years ago to flip houses.

    "It's so cool. There's so many different things that go into it," the Cape St. Claire resident said. "I'll be doing this until the day I die."

    He started investing in real estate about 10 years ago when he bought a rental home. Then he began rehabbing and selling about one house a year on the side, he said. He now owns about 10 rental properties and has flipped over 50 houses.

    Add your comment.


  75.    New heat for Southeast Michigan's housing market: Sales, prices hit 10-year highs – Crain's Detroit Business

    Experts say the tide is rising on several factors: pent-up demand from buyers who sat out the last recession, sellers who also waited and are no longer underwater on mortgages, and a clearing inventory of bank-owned homes.

    Add your comment.


  76.    Calculated Risk: Ornithology: What is a "deficit hawk"?

    Bill McBride:

    Note: Some people like to focus on "growth" to reduce the deficit, and they tend to focus on tax cuts to boost growth. However, all data and research shows that at the current marginal rates, tax cuts do not pay for themselves and lead to much larger deficits.

    Add your comment.


  77.    Something Not Rotten in Denmark – The New York Times

    Paul Krugman:

    … would Denmark's model be impossible to reproduce in other countries? Consider France, another country that is much bigger and more diverse than Denmark, but also maintains a highly generous welfare state paid for with high taxes. You might not know this from the extremely bad press France gets, but the French, too, roughly match U.S. productivity, and are more likely than Americans to be employed during their prime working years. Taxes and benefits just aren't the job killers right-wing legend asserts.

    Add your comment.


  78.    Britain's love affair with China comes at a price – Telegraph

    Ambrose Evans-Pritchard:

    The hangover from the country's $28 trillion investment and credit blitz will be slow and painful, a variant of the Japanese reckoning. The World Bank warns that China is heading straight into the middle-income trap unless the Communist Party relaxes its iron grip on the political system and opens the country to the free flow of ideas.

    Xi Jinping has no intention of relaxing anything. The most powerful Chinese leader since Mao Zedong is described by one party survivor as a "needle wrapped in silk".

    Add your comment.


  79.    Global Warming's Hurricane Tab in U.S.: $14 Billion and Counting – Bloomberg Business

    Past studies have concluded that the higher costs are mainly a function of building more homes and businesses along the coast, as well as the rising value of that property, and not due to storms juiced up by global warming.

    In the paper, Estrada and two European researchers say previous studies ignored the fact that more development often comes with added protection against hurricanes, from sea walls and stricter building codes to better early-warning systems. Those protections tend to reduce damages and may hide the effect of weather getting stronger, the scientists said.

    Add your comment.


  80.    Homeowners Build Home Designed to Withstand Wildfires

    "We have built our house to maximize its ability to survive a ground or crown wildfire," Bork told a group of FireWise participants during a recent tour. "All materials are noncombustible or ignition-resistant, so it's compatible with living in this urban-wildland interface."

    They've really done a major job of it. You should read the details for ideas.

    Add your comment.


  81.    Wapello woman facing arson charge | KCRG-TV9 | Cedar Rapids, Iowa News, Sports, and Weather

    A Louisa County [Iowa] woman is facing charges for what police are calling a case of arson.

    Add your comment.


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