Linking ≠ endorsement.
⇧ Communism better than democracy, says Vietnam party boss – seattlepi.com
A one-party dictatorship playing word games about democracy:
There is no organized movement in Vietnam calling for multi-party system.
Dissidents, who are active on social media, are quickly crushed.
⇧ Live blog of the Federal Reserve interest-rate decision – Capitol Report – MarketWatch
The Federal Reserve on Wednesday said "economic growth slowed" since its last meeting in December and that inflation is unlikely to rise rapidly toward its 2% target, a more dovish tone that suggests the bank won't be quick to raise interest rates again. "Inflation is expected to remain low in the near term," The Fed said in new, more cautious language. The central bank also alluded to stock market turmoil in the U.S. and China, saying it "is closely monitoring global economic and financial developments." Yet despite a more subdued near-term outlook, the Fed said it expects the economy to continue to grow "at a moderate pace," helped by a strengthening labor market. The vote was 10-0.
"This statement is going to be BEST REMEMBERED for the obvious and highly apparent things that the Fed just could not bring itself to say because it could not reverse its policy or deny that it was 180-degrees dead wrong.
—Robert Brusca, FAO Economics
⇧ Citizens group questions toll board members' ties to real estate | www.mystatesman.com
With an appointment to the Central Texas Regional Mobility Authority board pending, the toll agency's governing panel is once again under attack for its members' ties to real estate and development.
A group calling itself Citizens' Coalition noted at a Wednesday press conference that six of the board's seven members work in real estate or represent that industry as lobbyists and lawyers (or do both). And the group unveiled a map showing the real estate holdings of five of the board members, some of them close to the agency's network of existing or planned toll roads.
"Right now, the CTRMA board represents real estate interests and not the public interest," said coalition spokesman Fred Lewis in a press release. "The board is a special-interest rubber stamp for the toll road bureaucracy, highway contractors and land developers."
Such things can have huge impacts upon your real-estate investments.
⇧ Professor forecasts price plunge in North Texas housing market
Right now, the index strongly recommends renting over owning in North Texas, and suggests that renters would be much more likely to increase their wealth by investing in things like stocks and bonds instead of local real estate.
In fact, since last summer, every time we've checked in with Johnson, he has progressively warned that home prices in North Texas are poised to fall.
But then every time, home prices surge higher.
Prices certainly could even out (slow to a near stop) and probably should because builders ought to focus on affordability, but I don't see a huge bubble there to burst by any 25%. The Fed would really have to screw up by continuing to raise rates even while the Congress continues sitting on its fiscal-stimulus hands. Let's hope that's not what happens.
⇧ ?Where home prices are suffering: luxury sales – CBS News
If there's a place homeowners want to be these days, it's in solidly middle-class houses.
That's because the high end of the real estate market — home that sell in the top 5 percent of all property prices — have hit a dead zone with pricing, according to data from real estate data provider Redfin Corp.
Several cities have either reached or exceeded the home prices last seen during the July 2006 housing peak, including Dallas ….
⇧ Real Estate Investors Ride the Reurbanization Trend | Institutional Investor
Demographic shifts have breathed life back into the cores of U.S. cities, forcing local governments to update zoning rules and improve public transportation. In the wake of the 2008—'09 financial crisis, younger workers sought city centers with higher job growth, and empty nesters left the suburbs to rejoin the action downtown. This migration has created an opening for real estate investments that find new uses for old buildings.
I really like the idea of finding "new uses for old buildings."
⇧ Chinese Investors New York Real Estate | Jeff Blau
Chinese investors only really started piling into New York's commercial real estate market two years ago, and The Real Deal proclaimed 2015 the "year of the Chinese investor." But now, a growing number of developers argue the party may already be over.
Over the past months, stock market turmoil, exchange rate volatility and a slew of bad economic data have raised questions over the health of the Chinese economy.
Two things not mentioned that I think are quite important are Chinese capital controls and the US governments crack down on money laundering through real estate in Florida and New York. The two are associated.
⇧ Memo to Brown: Affordable housing is a life and death matter Capitol Weekly | Capitol Weekly | Capitol Weekly: The Newspaper of California State Government and Politics.
… when Toyota announced last year that it would move its headquarters out of Torrance, California, some blamed our state's taxes and regulation. But newer reports show a different culprit. "It was really about affordable housing," said insider Albert Niemi, dean of the Cox School of Business at Southern Methodist University. Toyota's departure — along with 3,000 workers and their spending power — is another wake-up call that we can no longer ignore California's housing crisis.
What should be done?
⇧ Sydney house prices have fallen by 3% – Business Insider
Rising mortgage rates, restrictions placed on investor lending, a surge of new apartments and a slowdown of Chinese buyers in the Sydney market were all behind the sluggish result, AMP Capital chief economist Shane Oliver said.
⇧ How low will Sydney property prices go? Not very | afr.com
The underlying demand for housing in Sydney is still supported by rising migration, a continued shortage of housing stock and strong state economy, says Andrew Wilson, the senior economist for Domain, part – along with The Australian Financial Review – of the Fairfax Media stable.
But three years of fast-rising prices have just exhausted people's ability to pay more.
"House prices can't rise ahead of incomes in perpetuity," says HSBC economist Paul Bloxham.
"We're starting to get to the point where it's having some effect in the first home buyers' willingness to be involved in the market. But it's not the only factor."
Regulatory moves to tighten lending to investors, along with higher rates charged by some lenders to investors – who play a larger part in the Sydney market than in other cities – are also curbing demand.
And despite a persistent under supply in Sydney, the increasing stock coming on stream is easing the pressure on prices slightly, says Bloxham, who predicts the Sydney market to "broadly level out" this calendar year.
China? No mention of China? What's that about?
⇧ Medical examiner: Boy brain dead after Wisconsin house fire – The Washington Post
I read story after story like this and think that we just must do a better job with fire suppression in housing. We have the technology. There's no price tag on kids' lives. We can create the money, which will create the jobs to get it done. Where's the political leadership to make it all happen?
⇧ Asia stocks jump, yen weakens as BOJ stuns with negative rates | Reuters
A relatively smart, bold move, though there are much better choices to rev up the Japanese economy:
… the Bank of Japan stunned markets by adopting negative interest rates in its boldest step yet to reinflate the long-languishing economy.
The yen fell across the board and sovereign bonds rallied after Japan's central bank said it would charge 0.1 percent for excess reserves parked with the institution, an aggressive policy pioneered by the European Central Bank.
It also said rates could go even more negative if needed to ensure inflation gravitated to its long-held, and often missed, target of 2 percent.
For starters, I'd go back to the post-war, pre-"reform" Japanese economic system. They were doing vastly better under it than they have done post-"reforms," reforms advocated by the laissez-faire types who created the huge Japanese bubble that popped and has never re-inflated.
⇧ California narrowly upholds key policy for solar growth | Reuters
Solar customers will have to pay a new fee of between $75 and $150 to connect a system to the grid, and will be required to move to time-based utility rates, paying more for power during peak hours. They will also be required to pay monthly fees of about $6 for certain utility programs.
I can hardly wait for battery storage to allow all solar users to disconnect. The government should fully support solar development and installation to completely replace the non-renewable, non-sustainable grid.
⇧ Industrial real estate isn't sexy, but in Seattle it sure is hot – Puget Sound Business Journal
… Amazon is driving the region's office market, it's also fueling the industrial market. Amazon's growth, along with record aircraft production at Boeing and wage hikes at Microsoft, are among the reasons for the expansion of the industrial market, according to Randy Gilliam of commercial real estate company Kidder Mathews.
⇧ The Top 10 Emerging Trends Shaping Real Estate in 2016 – Market Outlook – Curbed
A crashing Chinese economy, sinking commodity prices, and other factors have made the 2016 economic outlook seem somewhat dismal (just ask the candidates running for president). But one industry seems to be bucking those negative trends, and still growing after years of positive performance. According to the 2016 Emerging Trends in Real Estate, which was just released by the Urban Land Institute, the outlook for the next 12 months is rosy, with one analyst going so far as to call it "doggone good."
Well, maybe. A great deal depends upon Fed and fiscal policies and actions concerning them. If more premature-tightening is the plan and without radical monetary and banking reforms, we'll see a recession followed by a long period of stagnation, at best.
⇧ Related CEO Jeff Blau Says Chinese Real Estate Investment Is Drying Up – Capital Markets
Amid mounting fears that the recent downturn in China's economy could hurt investment in US real estate, the developer behind the country's largest mixed-use project ever—which has been backed in no small part by Chinese investment—said it's time to start looking elsewhere for funding.
⇧ The woman who knew too much | Made in Germany – YouTube
For UBS a traitor, for wider society a heroine: Stéphanie Gibaud. In her position as marketing specialist at the bank, she revealed how consultants from HQ in Switzerland reportedly helped French customers to evade paying taxes.
Disclosures from whistleblowers like her have seen fiscal authorities worldwide recouping billions. Behind every scandal, however, is a personal decision that transforms that individual's life.
⇧ Innovation and the State – YouTube
Dan Breznitz, is a Professor and Munk Chair of Innovation Studies, with a cross-appointment to the Department of Political Science. In addition, he is also Co-Director of the Innovation Policy Lab at the Munk School and the Director of Academic Research. Professor Breznitz is known worldwide as an expert on rapid-innovation-based industries and their globalization, as well as for his pioneering research on the distributional impact of innovation policies. Unlike many, he doesn't embrace a fully market-centric approach, acknowledging a major role for the State ….
⇧ Fire chief: Residents should see lower insurance rates with new Erie station – Boulder Daily Camera
A new fire station going up near Erie International Airport should be a boon to nearby residents' insurance rates, according to the Mountain View Fire Rescue fire chief.
⇧ Real estate market to rebound this year to pre-recession peak | Times Free Press
⇧ 10 countries hardest hit by weather disasters | World Economic Forum
In the last 20 years, weather-related disasters have claimed 606,000 lives and left 4.1 billion people injured, homeless or in need of emergency assistance.
⇧ Where the Commodity Glut is Driving Down Jobs – Real Time Economics – WSJ
North Dakota lost 18,800 jobs, or 4% of the total nonfarm payrolls, from December 2014 to December 2015 and West Virginia shed 11,800, or 1.5%, the Labor Department said Tuesday. Wyoming, another state with a significant natural resources sector, also saw big losses. The bulk of the downturn came in the mining sector, which includes activities related to oil, gas and coal extraction.
⇧ Emerging markets: Big trouble from brittle China /Euromoney magazine
If China finally rebalances its economy, aided by a weaker currency, it would generate new sources of consumer demand and investment opportunities for the world. In the meantime, developed markets will re-adjust to China's shifting external balance through monetary policy.
So far, the markets do not seem to share this optimism.
⇧ China sentences 3 rights activists to prison amid crackdown – StarTribune.com
The main charges against them were tied to their downloading, printing and distributing texts on democratic transformation and grassroots organizing, the groups said. Amnesty cited the state prosecutor's indictment as accusing them of having "promoted the ideas of civil disobedience . with the goal of overthrowing the socialist system."
Crackdowns on dissent since early last year have especially targeted lawyers and others who have attempted to use Chinese law to assert claims to property, wages, free speech and other basic civil and economic rights.
You see, that's what comes of not having a real, full democracy that would not promote the end of socialism but would democratize it, making the whole people its own leadership rather than having some Communist Party boss be the totalitarian dictator.
They already have a mixed economy in China. What's really going on is a few at the top clinging to personal power at the expense of the Chinese people in general.
The people could do a much better job of running the country if they could live under, and over, a truly transparent government, the first in human history.
⇧ Sanders' supporters ignore the lessons of Obama: Ruth Marcus | OregonLive.com
In the run-up to the 2012 election, frustrated Obama allies diagnosed his difficulties as having come from spending too much time on an "inside Washington" game. He would, they vowed, take his case directly to voters, harnessing their energy to break the cycle of congressional intransigence. How'd that one work out?
Did he really do that? Nope. Therefore, the question of how it worked out is not answerable.
Was the diagnosis wrong (that Barack Obama hadn't fought Wall Street enough)? Of course it wasn't. Anyone who was paying even the slightest attention knew full-well that Obama supporters were very upset with him that he had never taken off the gloves (figuratively speaking) and then he waited way too long and then asked for way too little. He wasn't in a position to motivate them. He lost that. He helped kill it. Bernie isn't suffering from that problem. He's no corporate captive, far from it.
What's the real motive behind all the Bernie-bashing? I'm not campaigning for him, but he's been getting a bum wrap by those who either hate his ideas or just don't understand that falling to the naysayers mantra is a self-fulfilling prophecy dooming real progressivism, Bernie's brand of which is very moderate by international standards, to say the least.
More importantly for Democrats if they are going to really care about "electability" is whether Hillary Clinton could beat the Republican nominee. Frankly, I doubt she could.
What would a contest between say a Donald Trump and Bernie Sanders look like. Well, the contrast would be the brightest in my lifetime and quite possibly the history of the US. That would be a good thing, and that's why I think so many with vested interests against Sanders fear him the most.
Not only that, but Trump would remain a wild card (with a very mixed progressive and conservative outlook) even if elected.
⇧ Boom, and a hint of gloom, at commercial real estate forecast | The Charlotte Observer
Charlotte's building boom is obvious, with cranes and workers putting up everything from new office towers to apartment buildings to shopping centers. But the big question Thursday night was how long the booming commercial real estate market will last.
What will the Fed do? If the Fed can't act, what will the Congress do? Will fiscal and tax policy be properly adjusted? Will greater austerity be implemented, which would only make things worse?
There's plenty more I could ask and say, but I'll leave it there for this one.
⇧ After historic strength in 2015, will the Bay Area's real estate boom last? Cushman & Wakefield's top S.F. execs weigh in (Video) – San Francisco Business Times
… global weakness in China and volatility in the stock market is dampening the mood, and experts are divided on whether the current growth trend is sustainable. Is the economy a tech bubble fueled by companies that don't have viable business models, in an echo of the 2000 crash? Or does the current growth period represent a new era of continued expansion?
⇧ Bay Area real estate: Coldwell Banker exec predicts upbeat 2016 market – San Jose Mercury News
Q I imagine you're concerned about world factors, including the Chinese market?
A It kind of goes day by day. A few days ago the Chinese government says, "Well, don't worry, we'll formulate some sort of bailout plan," and the stock market did well that day. A few days later, it was something else, and the market didn't fare as well.
I try not to pay too much attention to it, because the Bay Area seems to run a bit differently than the national market. But, look, if there was a stock market collapse, of course it would affect everything.
⇧ Real estate expert gives forecast for how we'll live, work | Gainesville.com
Real estate professionals heard from experts this week about industry trends — demand for open offices, bicycle parking and walkable communities — but they really wanted to know: Will the recovery end and will recent stock selloffs hurt real estate?
Andy Warren, director of real estate for PricewaterhouseCoopers, said the professionals he surveys are not seeing a disruption in their investment and development plans, although that could change if stock losses hit employment and companies pull back on hiring. International investors continue to sink money into U.S. real estate.
Everybody wants to be an optimist to keep the industry psyched up. However, the degree to which the US economy is insulated from the Chinese slowdown remains to be seen.
⇧ Kearns Wants Banks to Donate Zombie Properties
A lot of these homes they could be lived in again," community and housing activist Arthur Robinson said.
For years, Robinson has been working on cleaning up and rehabilitating these abandoned houses. He thinks Kearns' plan would be a win-win for the community and the banks.
The banks do the math and stay with the status quo. It's been the Fed's long-run policy: allow the real-estate markets to recover the banks' asset values no matter how long it takes and how much the local communities suffer.
When will the recovery be as much as it can reasonably be expected to be? After all, a rotting building/house can cost more than the land's price can recover while there's the property tax to be paid and money tied up that could be put to higher and better uses creating real growth, cleaner value, and a better return.
⇧ Michigan city is best housing market in U.S., says Forbes | MLive.com
I've been following Grand Rapids for years, and it's been a remarkable place considering all the woes that have beset Michigan, my original home state.
⇧ B.C. officials concerned homebuyers unaware of real estate risks – The Globe and Mail
Caveat emptor: Do your due diligence!
Recent deals on some key Vancouver properties at astronomical prices have politicians, planners, and the B.C. Securities Commission concerned about the level of speculation, misrepresentation or plain ignorance emerging.
City officials see signs that Vancouver's hot housing market is enticing buyers to pay inflated prices without getting complete information on how demanding the rezoning process is.
And they've also become alarmed recently at news that a new type of venture — real-estate crowdfunding — is being marketed without giving investors a picture of all the costs, hurdles and perhaps outright rejection that a development rezoning may encounter.
⇧ NASA | OLYMPEX Successfully Grabs the Rains – YouTube
NASA finishes campaign to study extreme rain, snow and winds of the Olympic National Forest. Scientists Walt Petersen of NASA Marshall and Robert Houze of the University of Washington narrate this inside look at the Olympic Mountain Experiment (OLYMPEX) field campaign. During the campaign, NASA and its partners gathered precipitation data through both ground and airborne instruments around the Olympic Peninsula in Washington State. They measured the abundance and variety of precipitation including light rain, heavy thunderstorms, and snowfall in the coastal forest. The data collected will provide crucial information to improve the Global Precipitation Measurement satellite mission's measurements of light rain and snow, as well as help researchers understand how precipitation changes across land and ocean.
⇧ Turmoil in the Oil Patch Is Hitting U.S. GDP Growth – Real Time Economics – WSJ
… turmoil could weigh on GDP more than anticipated. Capital spending per employee is much higher in the oil sector than elsewhere, said Ian Shepherdson of Pantheon Macroeconomics, and oil firms can't save themselves simply by cutting staff. (Their biggest expense is equipment.)
… the extent of the bleeding has shocked investors and caught many companies off guard. While the worst of the oil-price decline may be behind us, the same probably isn't true for capital spending.
That's no surprise to my consistent readership. Fracking changed the economic landscape much faster than economic models mostly in people's heads changed to keep up.
When we were more at the mercy of OPEC, lower prices were more of a boon.
I still haven't seen a really thorough study on the matter.
⇧ Are we heading for a crash? | Albert Edwards, Aditya Chakrabortty, Linda Yueh, Ruth Lea, Fred Harrison, Vicky Pryce, Dambisa Mayo, Yanis Varoufakis, Mariana Mazzucato | Opinion | The Guardian
The way the west got out of the 2008 crash was by relying on central bankers being generous in their provision of ultra-cheap loans. The hot money was sprayed into London property, commodities, or art auctions. And the gains ended up in the pockets of those already rich, rather than those who might use the money for consumption or to invest productively. Take away the credit and, as the IMF reminded us last week, the outlook goes dark pretty quickly.
That's exactly why we need more democracy rather than more corporatism/plutocracy. The whole system has been re-geared toward aiding the superrich, not the common people. It's the exact consequence of dismantling the New Deal rather than strengthening it via greater direct democracy.
⇧ Nouriel Roubini: The New Abnormal for a Troubled Global Economy | TIME
Ten years ago, who had heard of terms such as ZIRP (zero-interest-rate policy), QE (quantitative easing), CE (credit easing), or UFXInt (unsterilized FX intervention)? These esoteric and unconventional monetary-policy tools are now the norm in most advanced economies, and even some emerging market ones as well.
Some critics incorrectly argued that these unconventional monetary policies—and the accompanying mushrooming of the balance sheet of central banks, which they saw as an alleged form of debasement of fiat currencies—would lead to hyperinflation, a collapse in the value of the U.S. dollar, a sharp rise in long-term interest rates and the price of gold and other commodities, even the replacement of standard currencies with cryptocurrencies like Bitcoin. Yet none of that happened—inflation is still too low and falling in advanced economies, while long-term interest rates have kept on falling in the past few years. The value of the dollar has surged at historic rates even as commodity prices have fallen sharply—with gold dropping by some 25% in 2015—even as Bitcoin has been the worst-performing currency in 2014—15, if one could even call it a currency.
In spite of the ballooning balance sheets of central banks and the unconventional policies that were supposed to debase fiat currencies, inflation is too low and falling in advanced economies, and even in many emerging markets.
⇧ New Home Builders Help Revive the Affordable Starter Home
In the past few years home builders across the United States have had to deal with higher land costs, limited labor, and concerns about the demand of the entry-level market. Following the recession builders focused on developing larger more profitable homes while the housing market recovered. We saw a shift towards constructing higher priced, "move-up" homes. However, faced with surging home prices and the demand for more affordable homes, homebuilders are beginning to change their ways again. It is anticipated that In 2016, new home builders will likely shift to more affordable entry-level homes to meet the rising demand among millennials.
⇧ Monetary Policy is Not About Interest Rates
The long and short of it is that the Fed should stop worrying and learn to love waiting for real heating and then jack up the rate in a big step rather than not waiting and raising in tiny amounts (only to be embarrassed and have to reverse).
⇧ Consumption Growth Keeps GDP Positive in Fourth Quarter 2015 | GDP Bytes | Data Bytes | Publications | The Center for Economic and Policy Research
… employment growth would have been near zero if productivity growth had remained in a range of 1.5—2.0 percent over the last five years. On the other hand, if productivity growth remains stuck at the slow pace of the last five years, it will impose a serious limit on the ability to raise living standards.
A possible explanation is that the weak labor market itself is acting as a drag on productivity as workers are forced to take low-paying, low-productivity jobs. We will only know if this is true if the labor market tightens enough to give workers more bargaining power and the ability to move to higher paying jobs.
⇧ mainly macro: Sanders, Corbyn and the financial crisis
… wise heads may warn that the radical left has in many cases not grasped the nature of the problem and are simply repeating old slogans, and worse still that voting for radical leaders may deny the left the chance for power, but inevitably this can sound just like the appeasement of many on the centre left. What Corbyn's victory shows Democrats in the US is the power of the contradiction between the global financial crisis and where we are now.
Take that, Paul Krugman. Well, I don't think Paul doesn't mean well. He's just not comprehending how much the times have changed and will continue to change, radically!
If Corbyn can become Labour's Shadow PM, Bernie Sanders can become President of the US. Why? Because the US is just as progressive as the UK, and Sanders isn't even as radical as Corbyn (who may well become the Prime Minister).
Look, George McGovern's loss led to Jimmy Carter's center-left win. However, Carter's loss to Reagan led to Bill Clinton's group formulation that to win, the Democrats would have to disavow aspects of the New Deal, which Clinton ended up doing, ushering in the Great Recession.
Yes, Bill Clinton's policies (deregulation) were hugely responsible for the Great Recession. George W. Bush only made matters worse.
So, now we have Bernie Sanders saying enough is enough with this middle-class-destroying, stealthy policy that mainly benefits the plutocrats.
Here's the most important part of it. The youth hear him, in detail, and for the first time, aren't falling for the nonsense against New Deal type policies and practices. They know that deregulation was a mistake. They want smart regulations, not no regulations, and they're right in that.
⇧ China property sales growth to slump in 2016: Moody's
Sales growth of properties in China will tumble this year as a result of slowing economic expansion and developers' high debt levels, Moody's Investors Service said on Wednesday.
The ratings agency said that growth in property sales across the country would slow to 0-5 percent in 2016, after a strong performance of 16.6 percent in 2015.
What's important there is that Moody's isn't a "real estate" company. Hopefully, the higher-ups in the business don't expect real estate rah-rah as a psychological tool where Moody's might benefit in a huge way.
⇧ Is the global economy headed for another crash? – Al Jazeera English
Ann Pettifor, director of Policy Research in Macroeconomics, also known as PRIME. Ann is also author of: "Just Money: How Society can Break the Despotic Power of Finance".
Vicky Pryce, chief economic adviser at The Centre for Economic and Business Research.
Anastasia Nesvetailova, director of the City Political Economy Research Centre at City University in London.
I'm not quite as gloomy in my outlook much for the reasons Anastasia Nesvetailova mentioned: that the technocrats really do know what has gone wrong. However, it is also quite true that the politicians and the plutocrats who own them aren't necessarily going to be forced to do what's right. That's up to the "great unwashed." Will the people make them or finally displace them in power? Let's hope so.Add your comment.
⇧ Hysteria over China has become ridiculous – Telegraph
"Right now, I think it highly unlikely that Beijing would let any financial institution of any real significance collapse. They won't let any firms collapse, much less the stock market. Their entire strategy appears to be 'paper things over and deal with it later'," he said.
"The current leadership is acutely aware of its place in history and the comparisons to the USSR. They are absolutely determined to not suffer the same fate."
Yet there are limits to what the Communist Party can achieve by flicking its fingers at this late stage of China's $26 trillion debt debacle. The Achilles Heel is capital flight.
… My view has long been – and continues to be – that China has left it too late to wean the economy off debt-driven growth and over-investment in industry, and will therefore drift into the middle-income trap.
Since China's banking system is an arm of the state, bad debts will be rolled over in perpetuity. There will be a slow loss of dynamism rather than a "Minsky" moment. It will be a denouement "a la japonaise", a landscape of soporose companies.
The Communist Party may have bought another year to 18 months. If so, the reckoning has been delayed again. Optimism means nothing more than that.
Okay, but if that's a soft landing (where the system would linger on the ground for a long, long time), then I don't see the Chinese people standing for it for very long. There are too many of them who have tasted what they won't allow to be taken from them for long by the incompetence of the Communist Chinese Party, which they should overthrow and replace with real democracy. The sooner, the better.
⇧ Elizabeth Warren: One Way to Rebuild Our Institutions – The New York Times
"… only if voters demand it." It will take more than simply demanding, but she has the right idea.
… the administration's record on enforcement falls short — and federal enforcement of laws that already exist has received far too little attention on the campaign trail.
The next president can rebuild faith in our institutions by honoring the simple notion that nobody is above the law, but it will happen only if voters demand it.
When I was reading Elizabeth Warren's article, I couldn't help but be reminded of just how old these sorts of issues are.
In this classic crime film starring James Cagney and Mae Clark, Cagney is an honest [progressive] inspector who takes on retail and government corruption: "GREAT GUY" (1936):
That was made during the New Deal era.
⇧ Subprime Reasoning on Housing – The New York Times
Do these guys understand that they are giving a monetarist's critique of the Fed's inactions? Of course they do. So what's up with that, considering that they run in libertarian circles?
Well, what they're up to isn't stated; but they haven't changed their stripes. They are up to unstated libertarian-goals. They want to brainwash people into looking first and foremost and perhaps exclusively at the Fed as the one and only reason for the crash, which is utter nonsense.
They want you to falsely conclude that even with all the deregulations that went on and all the obvious lender fraud, that had the Fed only loosened sooner, all would have gone swimmingly, as if liar's loans pushed by Wall Street weren't toxic and hadn't doomed the entire securitization scheme of passing off junk as AAA.
David Beckworth is a former economist at the Treasury Department and a visiting scholar at the Mercatus Center; Ramesh Ponnuru is a columnist for Bloomberg View and a visiting fellow at the American Enterprise Institute.
Check it out: http://www.sourcewatch.org/index.php/Mer catus_Center
These guys are anarcho-capitalist. That's anarchists, so long as the system is capitalist (only capitalist). They believe in laws of, by, and for the plutocrats and letting the markets (not votes) dictate everything, which always results in monopoly power and gigantic economic and financial abuses, not to mention environmental degradation, now on a global scale.
⇧ Are Economists in Denial About What's Driving the Inequality Trainwreck? | Institute for New Economic Thinking
According to Piketty's colleagues Emmanuel Saez and Gabriel Zucman, the share of wealth of the top one percent was around 50 percent on the eve of the Great Depression. With high taxes inherited from the New Deal and WWII, along with a sluggish stock market, the share fell to 25 percent in the 1960s. Now it has crept back up to around 40 percent (other estimates come in a bit lower). Our calculations, based on a Cambridge U.K. growth model proposed by economist Luigi Pasinetti, suggest that with current saving rates and high profits the share could rise to 60 percent.
LP: So pretty soon our wealthy will be riding higher than their counterparts in the Roaring Twenties?
LT: Potentially, yes.
⇧ Sober Look: US consumer is the last defense against strong dollar drag on the economy
Strong US dollar has created a significant drag on economic activity in the US but economists are betting that the consumer tailwinds should support growth,. If however the consumer (spooked by the sharp correction in the equity markets) retrenches, US growth could stall.
⇧ Millions of US, EU youth are neither working nor learning | Pew Research Center
Teens and young adults were among the groups hit hardest by the global financial crisis. And while many young people have since regained their footing — as employees, students or both — there are still millions in the U.S. and abroad who are neither working nor in school. Though sometimes referred to as "disconnected" or "detached" youth, globally those young people often are called "NEETs" — because they are neither employed nor in education or training.
Labor economists are paying increasing attention to NEETs — especially when, as in much of Europe, NEET rates are persistently high. They fear that without assistance, economically inactive young people won't gain critical job skills and will never fully integrate into the wider economy or achieve their full earning potential. Some observers also worry that large numbers of NEETs represent a potential source of social unrest.
⇧ 3 Areas to Evaluate When Walking Through Apartment Buildings
During this video, I share three critical areas that I evaluate when I walk through a large apartment building ….
⇧ China's central bank makes massive cash infusion – MarketWatch
China's central bank is putting the largest amount of cash into the financial system in nearly three years ….
⇧ Soros Gets China Rebuttal as State Media Says Bears Are Deluded – Bloomberg Business
"At the end of the day, the exchange rate should be driven by macroeconomic fundamentals," said Sue Trinh, the Hong Kong-based head of Asia foreign-exchange strategy at RBC. "The end game is these capital controls are inconsistent with China's goal to internationalize the yuan. You've got to make a choice."
⇧ The Shipping News Says the World Economy Is Toast – Bloomberg View
In October 2008, as the repercussions of the financial crisis were starting to ripple through the global economy, I noticed a press release from Swedish truckmaker Volvo saying that its European order book had fallen by more than 99 percent between the third quarters of 2007 and 2008 — to just 155 from 41,970. That prompted me to study various other real-world activity measures ranging from shipping to air freight, and to conclude that "the news is all bad and getting worse, fast." The same exercise today, I'm afraid to say, leads me to a similar conclusion about the growth outlook.
⇧ Here's one argument why China will lose its currency war – MarketWatch
"Given the interventionist mind-set in Beijing, capital controls may also be tightened further, although this could backfire by giving investors an even greater incentive to get out while they still can," said Williams in a note.
⇧ China's 'hard landing' may have already happened | afr.com
"In our view, Wu-Maddison numbers explain the current state of commodity markets and fit into the global deflationary narrative much better than official numbers," the analysts Macquarie said in a note.
But, as the bank points out, if the "hard landing" has already occurred, there will be a range of consequences for productivity growth, overcapacity absorption and financial stress.
"If Wu estimates are right, the room for stimulus and investment is more limited and the need to drive productivity [structural reforms] much more urgent. Although by the time China retroactively adjusts its GDP, it would be treated as history.
"In the absence of stronger productivity rebound, China would be in danger of getting stuck in the 'middle-income trap' and would be unable to inject incremental demand into the global economy. Stay safe."
I definitely have not believed the Chinese official numbers for many years now. Their numbers have always come in way too close to projections, something the US has never been able to do even though the US has actually had better data collection and analysis all along.
⇧ Bank of Japan's negative rates are 'economic kamikaze': Boockvar
Peter Boockvar said:
… You're basically penalizing the Japanese consumer, and I don't know what economic theory is behind that."
Charging interest on excess reserves makes it more costly for banks not to lend. It's not theory.
What Japan needs to do is reduce the sales tax back to where it was or even lower.
⇧ Yuan Vs. Yen: How China Figures Into Japan's Negative Rates? – MoneyBeat – WSJ
Japan's move to negative interest rates is the latest step in a dangerous dance between the world's second and third largest economies.
The problem is currencies. China's moves to bring down the value of the yuan have rattled markets this year, sparking a flight from risky assets that has sent investors into safer havens like the yen.
The stronger yen in turn has threatened to tip Japan's economy back into deflation, which the central bank has struggled to vanquish. The rising yen has also put more pressure on corporate profits and helped push Japanese stocks into bear market territory last week.
⇧ China GDP Growth Could Be as Low as 4.3%, Chinese Professor Says – China Real Time Report – WSJ
Why in the world do so many Western economists buy China's official economic-numbers in the face of so much evidence that those numbers are rather inflated?
⇧ Tepid GDP Growth a Sign Construction Spending May Sputter; Decline Unlikely
"The economy did not end the year well," said ABC Chief Economist Anirban Basu. "Today's GDP data adds weight to the argument that the U.S. is in a corporate profits recession, an industrial recession, and was experiencing a softening of investments. With the exception of the residential building sector, business capital outlays have declined as corporations deal with a combination of sagging exports, competitive imports, declining energy related investments, rising wage pressures and healthcare costs.
"Recent turbulence in financial markets suggest that capital availability may continue to soften," said Basu. "While residential construction is likely to continue to recover given the combination of low interest rates and accelerating household formation, nonresidential construction spending growth may begin to sputter a bit as those who deploy capital become more defensive. This is not to suggest that nonresidential construction spending is set to decline. Many contractors continue to report significant and growing backlog. However, the current situation suggests that the growth in backlog and ultimately in spending may not be quite as rapid as it was earlier in 2015."
⇧ West report OK'd, stricter ammonium nitrate standards urged
Landlords and managers: FYI:
Texas has 80 plants that store more than 5 tons of ammonium nitrate, a chemical used in fertilizer. Nineteen plants storing fertilizer-grade ammonium nitrate operate within a half-mile of a school, hospital or nursing home, according to the report. More than 30 of them are within a quarter-mile of a home or apartment building.
Do you know what's around your properties? What policies and practices do you have in place to mitigate?
⇧ EARTHWORKS | Responding to Texas quake uptick, seismic study gets underway
"Although there are always naysayers, the vast majority of scientists in the earthquake community would agree (that the uptick in quakes) is caused by human activity, mostly from wastewater injection wells associated with fracking or oil production," one University of Texas seismologist, Cliff Frohlich, told the newspaper.
⇧ Early Hurricane a Warning of Stronger Storms to Come
"As climate changes due to human activities, more and more of the excess heat being trapped by the carbon dioxide in the atmosphere is going into the oceans," says Hayhoe. "This means the conditions conducive to hurricanes — particularly strong ones — will likely increase as climate changes."
⇧ Snyder pledges help to Flint amid mistrust of government
It remains unclear how badly the pipes were damaged after the decision in 2014 to use the Flint River as the city's drinking water source without adding a chemical to control corrosion. That caused lead to leech into the water for a year and a half and contributed to the spike in child lead exposure before state and officials fully acknowledged the problem in early October.
⇧ NYC Flood Defense Plan Advances, but Completion Years Off – ABC News
After ocean waters poured into lower Manhattan during Superstorm Sandy, experts began dreaming up a solution: a U-shaped barrier of earthen berms, walls and gates that would keep floods out and the nation's financial capital dry.
Now, more than three years later, a version of that idea has stacked up over $600 million in backing, including a $176 million shot in the arm from the federal government last week. But it is still hundreds of millions of dollars and several years away from being finished.
⇧ Top 100 most dangerous places to live in the USA – NeighborhoodScout
Our research reveals the 100 most dangerous cities in America with 25,000 or more people, based on the number of violent crimes per 1,000 residents. Violent crimes include murder, rape, armed robbery, and aggravated assault. Data used for this research are 1) the number of violent crimes reported to the FBI to have occurred in each city, and 2) the population of each city.
⇧ Niagara Falls man convicted of insurance fraud – City & Region – The Buffalo News
Evidence showed that Ashby had been reimbursed for the same items in a previous burglary claim in Ontario with another insurance company. Sloma said she and Grundy produced witnesses who said Ashby had little property in his Niagara Falls apartment and had brought almost nothing over the bridge from Canada, which had barred him from returning to that country.
⇧ Hoverboard bursts into flames at Petaluma home : State
A hoverboard burst into flames in a Petaluma home, marking the second such fire in Sonoma County in a week.
Have you banned these from the premises, including out from parked vehicles?
⇧ Funding Plan for Arkansas Fire Departments Proposed by Lawmakers
… two legislators are working on a plan that would take surplus money collected from the state as a secondary source of money for fire departments and disburse among departments with an Insurance Services Rating of 9 or 10.
I'm not surprised one of them is an independent insurance-agent.
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