News: Real Estate, Risk, Economics. Mar. 29, 2016

Linking ≠ endorsement.

Table of Contents
(Click to sections below.)

1) Another record low for Arctic sea ice maximum winter extent | Arctic Sea Ice News and Analysis

2) The New Budget Proposal And You | MyGovCost | Government Cost Calculator

3) Trimmed Mean PCE Inflation Rate – Dallas Fed

4) Oil, Inflation Expectations, and Credibility – Tim Duy's Fed Watch

5) Quantitative Ease by Carola Binder: Congressional Attention to Monetary Policy over Time

6) United States Money Supply M0 | 1959-2016 | Data | Chart | Calendar

7) FEMA to Louisiana Flood Victims: Don't Wait to Begin Repairs

8) Oklahoma Insurance Commissioner: Man Scammed Moore Tornado Victims

9) What I've Learned About Real Estate Investing in 10 Sentences

10) Renting vs. Buying a Home: Which Is Smarter? – US News

11) Hedge Funds Pumped Up Silicon Valley. Now They're Pulling Out – Bloomberg Business

12) Huge fire engulfs 2 towers of residential skyscraper in UAE (VIDEO) — RT News

13) 7 million Americans at risk of man-made earthquakes, USGS says – The Washington Post

14) Title companies key to real estate transactions in Erie County – Buffalo – Buffalo Business First

15) This real estate market is about to crash-—commentary

16) Real estate broker pleads guilty to theft, forgery | News | heraldbulletin com

  1.    Another record low for Arctic sea ice maximum winter extent | Arctic Sea Ice News and Analysis

    There is little correlation between the maximum winter extent and the minimum summer extent—this low maximum does not ensure that this summer will see record low ice conditions. A key factor is the timing of widespread surface melting in the high Arctic. An earlier melt onset is important to the amount of energy absorbed by the ice cover during the summer. If surface melting starts earlier than average, the snow darkens and exposes the ice below earlier, which in turn increases the solar heat input, allowing more ice to melt. With the likelihood that much of the Arctic cover is somewhat thinner due to the warm winter, early surface melting would favor reduced summer ice cover.

    I'm not sure why they didn't mention El Nino's influence. Anyway, I expect we'll break the record this summer too.

    It will be really interesting to watch how this El Nino ends and how long it will be before the next. I was quite surprised that it took so long to show up; but when it did, wow!

    Add your comment.


  2.    The New Budget Proposal And You | MyGovCost | Government Cost Calculator

    Libertarian calculators like this are nearly useless because they don't account for savings due to
    1) not paying privately for services obtain publicly (though Obamacare is a mix of private and public) and
    2) society in general from
    a) lower costs of taking care of people who once had no insurance and
    b) keeping more people out of poverty.

    Poverty is very costly to society, and laissez-faire does not cure poverty, quite the contrary. It creates serfs to the capitalist aristocracy. It leaves people in "systemic unemployment." It is indifferent to their plight. Only intervention from non-capitalist philosophy alters that. Even Adam Smith knew it and was not for unbridled, unregulated, laissez-faire capitalism.

    Add your comment.


  3.    Trimmed Mean PCE Inflation Rate – Dallas Fed

    Do you see the signs of a heating economy? I don't. I'd rather wait until it's at least warm before starting to concern myself with the Phillips Curve.

    Where's the proof that there isn't still plenty of labor slack?

    Where's the proof that those who pay the wages will pass along a share in the gains rather than offshoring labor or bringing in labor willing to work for the minimum, which is low by historical standards and not subject to a COLA but should be?

    One-month PCE inflation, annual rate

    Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16
    PCE -0.7 0.9 1.5 -1.0 1.4 -1.3
    PCE excluding food & energy 2.1 0.7 1.8 0.8 3.3 1.8
    Trimmed Mean PCE 2.0 1.4 2.0 0.9 2.3 1.8

    Add your comment.


  4.    Oil, Inflation Expectations, and Credibility – Tim Duy's Fed Watch

    Tim Duy has out done himself here.

    Bottom Line: Be wary of claims that oil prices are influencing inflation expectations; the recent correlation is likely spurious. Inflation expectations look to be following a mean reverting process, indicating that the Federal Reserve's has credibly committed to their inflation target. We should expect policymakers will maintain such credibility if they continue to react to inflation shocks with offsetting policy.

    Here's my "Bottom Line" on this. Tim Duy's problem is that he forgets or doesn't know that he's often smarter than the people he's discussing at the Fed, not that Yellen is a slouch, She's far from that. It's easy to be guilty of giving others too much credit when things seem so clear to one.

    Anyway, I obviously think Tim nailed the oil issue and inflation expectations.

    In lay terms, it seems most people think the oil industry is a hard read, especially with the geopolitics involved. It's also obvious that carbon fuel-efficiency takes a back seat to power, speed, and ego for many even if the thrill might be temporary and they may be stuck with a gas guzzler if the Saudis cave in and the frackers get their hands tied due to earthquakes, water pollution, and global warming, which they should.

    Add your comment.


  5.    Quantitative Ease by Carola Binder: Congressional Attention to Monetary Policy over Time

    … by neither metric of bills nor hearings is the Fed facing an unprecedented era of Congressional meddling.

    Meddling?

    U.S. Constitution
    Article I
    Section 8.
    The Congress shall have power …
    To coin money, regulate the value thereof ….

    Meddling? How about taking back? How about undoing abrogation? How about cutting out the middle people who are taking a cut by creating money in the form of credit and doing so based upon a 10% reserve ratio and where the US government insures depositors up to $250 thousand? How about replacing the Fed with a computer program and computer network. How about the US government not borrow money anymore but just create it debt-free? How about the US government getting out of the usury business?

    Add your comment.


  6.    United States Money Supply M0 | 1959-2016 | Data | Chart | Calendar

    Money Supply M0 in the United States increased to 3872547 USD Million in February….

    That's $3,872,547,000,000. We'll round it to $3.8 Trillion.

    So, where's the inflation? It's not here because the money isn't moving.

    Helicopter money would increase the supply and place it into the hands of those with a high propensity to spend it, first to meet basic necessities or to pay down debt.

    Paying down debt extinguishes credit or money. The "helicopter drops" would have to be large enough or frequent enough that people would feel comfortable with not continuing simply to increase savings after paying off debt. Would it overheat the economy? Doubtful they'd issue enough for that; but were they to, so what? It would level out after the drops were to stop, and the Fed could then raise rates anyway and to its heart's content (data-driven, of course).

    Add your comment.


  7.    FEMA to Louisiana Flood Victims: Don't Wait to Begin Repairs

    The Federal Emergency Management Agency is urging Louisiana residents whose homes were damaged during recent floods not to wait for a FEMA inspector before beginning to clean up and conduct repairs.

    Absolutely. The only time to wait is when the damage is too extensive or dangerous for non-professionals to handle, in which case, caution signs should be put up advising people of risks of bodily injury and/or illness.

    Be sure to read up on proper flood clean-up methods and protective clothing, etc.

    Add your comment.


  8.    Oklahoma Insurance Commissioner: Man Scammed Moore Tornado Victims

    … Antario Brown, 36, led the victims to believe he was a public adjuster and that his services were required to process their insurance claim.

    Add your comment.


  9.    What I've Learned About Real Estate Investing in 10 Sentences

    Out of character: short and sweet:

    Everything I've Learned About Real Estate Investing in 10 Powerful Sentences

    Add your comment.


  10.    Renting vs. Buying a Home: Which Is Smarter? – US News

    This one is more interesting than the typical rent-v-buy article.

    Add your comment.


  11.    Hedge Funds Pumped Up Silicon Valley. Now They're Pulling Out – Bloomberg Business

    Naturally, this will slow real estate in that sector.

    Add your comment.


  12.    Huge fire engulfs 2 towers of residential skyscraper in UAE (VIDEO) — RT News

    Again? Yep!

    It's painfully obvious that they've built lots of buildings over there that are not up to international fire-safety codes.


    https://twitter.com/i/videos/tweet/71454 3307972546560

    Add your comment.


  13.    7 million Americans at risk of man-made earthquakes, USGS says – The Washington Post

    "My first thought was actually holy crap, Oklahoma is redder than California," USGS geologist Susan Hough said in an email to The Post after she saw her agency's map Monday for the first time.

    Add your comment.


  14.    Title companies key to real estate transactions in Erie County – Buffalo – Buffalo Business First

    "They're generally very helpful and knowledgeable, in terms of order, easements and all types of questions that come up," she said. "So we work with them very regularly."

    Add your comment.


  15.    This real estate market is about to crash-—commentary

    Wow, this makes it sound much worse than I'd seen before. Of course, some of the impacts are a bit new yet. The Treasury Department's requirement isn't going to last long. People could be holding back just waiting for it to end.

    Still, sanctions against Russia hit New York real estate and despite all the people who were claiming it would actually increase Russian investments by those wanting to get their money out of Russia before Russia's collapse.

    Well, Russia hasn't collapsed, though times are certainly harder (but leveling out and improving in many ways that will take time to show through).

    The Chinese are still a wild card. I think Xi will clamp down harder and harder though (if the people keep him around rather than pulling off a democratic revolution that country sorely needs).

    Add your comment.


  16.    Real estate broker pleads guilty to theft, forgery | News | heraldbulletin.com

    Madison County real estate broker Roger Shoot could face a maximum of four years in prison after pleading guilty on Monday to four felony criminal charges.

    If he thought he'd get away with it, I'd be amazed at the level of stupidity.

    Add your comment.


If you are an investor in 1-4 unit properties in Arizona, California, Nevada, Oregon, Utah, or Washington, please do the financially responsible thing and make sure you have proper Landlord Insurance with PropertyPak™. We love focusing on real estate and the economy in general, but we are also here to serve your insurance needs.

Hill & Usher (PropertyPak™ is a division) has many insurance offerings. See our menu above for more info and links.

Did this post help you? Let us know by leaving your comment below.

Note: This blog does not provide legal, financial, or accounting advice. Seek professional counsel.

Furthermore, we, as insurance producers, are prohibited by law from disparaging the insurance industry, carriers, other producers, etc. With that in mind, we provide links without staking out positions that violate the law. We provide them solely from a public-policy standpoint wherein we encourage our industry to be sure our profits, etc., are fair and balanced.

We do not necessarily fact checked the contents of every linked article or page, etc.

If we were to conclude any part or parts of our industry are in violation of fundamental fairness and the legal standards of a state or states, we'd address the issue through proper, legal channels. We trust you understand.

The laws that tie our tongues, so to speak, are designed to keep the public from losing confidence in the industry and the regulatory system overseeing it. Insurance commissioners around the country work very hard to analyze rates and to not allow the industry to be damaged by bad rate-settings and changes in coverages. The proper way for people in the industry to deal with such matters is by adhering to the laws, rules, and regulations of the applicable states and within industry associations where such matters may be discussed in private without giving the industry unnecessary black eyes. Ethics is very high on the list in the insurance industry, and we don't want to lose the people's trust. That said, the industry is not perfect; but what industry is?

For our part, we believe in strong regulations and strong regulators.

We welcome your comments and ask you to keep in mind that we cannot and will not reply in any way or ways where any insurance commissioner could rightly say we've violated the law of the given state.

We are allowed to share rating-bureau data/reports and industry-consultant opinions but make clear here that those opinions are theirs and do not necessarily reflect our position.

Subscribe