News: Real Estate, Risk, Economics. Dec. 28, 2016

Linking ≠ endorsement.

Table of Contents
(Click to sections below.)

1) Here are the 25 cities with the biggest rent hikes | 2016-12-09 | HousingWire

2) How a wind tunnel that recreates hurricanes makes homes safer – Curbed

3) Trump's housing secretary Ben Carson only has one opinion about housing: policies to desegregate are wrong — Quartz

4) What China's Capital Controls Mean For Global Real Estate

5) Investor snaps up 2 Far North Dallas apartment communities | Real Estate | Dallas News

6) Trump effect: That house you want got $16,000 more expensive since he won

7) Greece must reform or leave eurozone, says German minister | World news | The Guardian

8) Vancouver Tax Pushes Chinese to $1 Million Seattle Homes – Bloomberg

9) 4 All-Too-Common Real Estate Scams Making Headlines

10) Residents Return to Tennessee City Demolished by Fire

11) Pair indicted on 2 counts of arson, insurance fraud – The Blade

12) Sea ice hits record lows | Arctic Sea Ice News and Analysis

13) Officials Investigate Massachusetts Fire That Damaged 15 Structures

14) Fordham Real Estate institute | NYU Schack

15) A Primer on Equilibrium | Uneasy Money

16) Apartment Vacancy Rate Stays Low, Surprising Researchers

17) Study Predicts Warming Will Trigger 3 Times as Many Extreme Downpours in US

18) Officials: Landlord May Face Citations after Ohio Fire Kills 4

19) Why Trade Deficits Matter – The Atlantic

20) The American Dream, Quantified at Last – The New York Times

21) Manhattan Apartment Landlords Prop Up Market With Incentives – Bloomberg

22) Tales from the Seattle housing market: Modest home almost gets $1 million – Curbed Seattle

23) City is stepping up to address homelessness in West Seattle; but many residents remain distrustful | West Seattle Herald / White Center News

24) Kent City Council considers law to protect low-income tenants | Kent Reporter

25) Ruling expected on attempt to block Seattle's expansion of mother-in-law units | The Seattle Times

26) Consumer sentiment soars as election dust settles, University of Michigan says – MarketWatch

27) Why China Can't Stop Capital Outflows – Bloomberg View

28) Audit: Vacant properties should pay fire assessment – News – Daily Commercial – Leesburg, FL

29) Communal Living: Should Real Estate Developers Be Interested?

30) Oops! Pittsburgh cites self over derelict properties | TribLIVE

31) How to find and finance bank-owned properties

32) UW professor: Seattle construction noise goes on too late

33) City goes hi-tech with aerial lasers to track abandoned properties

34) City Council approves limits on renters' move-in costs, taking aim at housing crisis | The Seattle Times

35) Pinpointing the Bubble in China's Real-Estate Market – Bloomberg View

36) Feds charge Ridgefield Park man in real estate fraud scheme

37) Dollar Climbs to Strongest Since 2003 on Fed Path; Bonds Drop – Bloomberg

38) Beware The UBTI Rule When Investing In Real Estate With Retirement Funds

39) Will surging mortgage rates weaken US home sales? | OregonLive com

40) Mick Mulvaney: Trump's big cabinet surprise – Dec. 19, 2016

41) Nobody, including the Fed, knows the lowest unemployment rate that's consistent with stable inflation – The Washington Post

42) Increasing rent, but still no fix for sprawling mold at QT Properties in Lyndale | City Pages

43) Construction Input Prices Plummet in November

44) Make Finance Servant, not Master — Prime Economics

45) United States Capacity Utilization | 1967-2016 | Data | Chart | Calendar

46) United States Nahb Housing Market Index | 1985-2016 | Data | Chart

47) United States Households Debt To Gdp | 1952-2016 | Data | Chart | Calendar

48) How to Prevent (& Deal With) Mold in Your Rental Properties

49) mainly macro: Reactionary Keynesianism

50) Trump creates new position for China hawk in White House | Washington Examiner

51) Fewer properties go unwanted at St. Louis tax auctions | Political Fix | stltoday com

52) Seattle shocker: Market forces can work | The Seattle Times

53) mainly macro: When is an economic recovery not a recovery?

54) The Italian Banking Crisis: No Free Lunch — Or Is There? | WEB OF DEBT BLOG

55) #TheMostSeriousSmog of the year when China boosts economy with coal

56) The American School of Economics

57) The American System of Economics | American Jobs Alliance

58) Seattle Is Creating a Ton of Low-Income Housing. How Do We Decide Who Gets It? | Seattle Weekly

59) Greece is rock bottom in EU's social justice rankings | Business | ekathimerini com

60) Indian Banks' Poisoned Chalice – Bloomberg Gadfly

61) London House Prices Are Having Their Worst December in Years – Bloomberg

62) Greece faces permanent crisis as IMF warns bail-out plan 'simply not credible'

63) Final EPA Study Confirms Fracking Contaminates Drinking Water

64) Someone Has to Tell John Williams Inflation Is Not Accelerating | The Center for Economic and Policy Research

65) US sues Barclays for alleged mortgage securities fraud

66) Greek PM in Open Confrontation with German FinMin | GreekReporter com

67) Shanghai water supply hit by 100-tonne wave of garbage | World news | The Guardian

68) Corporate Welfare Won't Create Jobs – The New York Times

69) Milton Friedman is dead, and really misunderstood • The Berkeley Blog

70) Fed Turns Hawkish – Tim Duy's Fed Watch

71) When It Comes to Trumponomics, Economists Are on High Alert | The Fiscal Times

72) Jeb Hensarling and the Allure of Economism | The Baseline Scenario

73) Larry Kudlow and Economics in the Trump Administration | The Baseline Scenario

74) The Crisis of Market Fundamentalism

75) Ayn Rand and Corporate Tax Cuts Won't Mend the Economy – The New Yorker

76) Democracy Against Domination: Overcoming Economic Power and Regulatory Failure in the New Gilded Age –

77) Sinkhole opens up in suburban Detroit, damages home

78) Economists versus the Economy

79) The Bairoch conjecture on tariffs & growth | pseudoerasmus

80) Obama's legacy is a devastated Democratic Party | New York Post

81) The Long-Term Jobs Killer Is Not China. It's Automation. – The New York Times

82) 9 Ways To Maximize Profit On Your Rental Property | SmartMove

83) John Mauldin — Brace Yourself For Italy's Bankruptcy

84) The Bank of Canada just laid out how the economy could tank – Macleans ca

85) Millions of Americans are stuck in part-time jobs – Equitable Growth

86) Karl Polanyi for President | Dissent Magazine

87) Philadelphia Fed Research Measures Impact of Gentrification on Low-Cost Housing Stock

88) Time To Turn The Page Of Platform Capitalism?

89) 10 Things To Consider Before Buying Income Property | Bankrate com

90) The 5 biggest lies of global capitalism | World Economic Forum

91) New LA law will help tenants when their landlords offer buyouts – Curbed LA

92) Germany has thousands of banks. The UK has just five, and it's strangling our economy. | The Co-operative Party

93) A new orientation away from neoliberalism | Real-World Economics Review Blog

94) Hawkish Fed Exacerbates Dollar Fears for Emerging Markets – Bloomberg

95) Insurance Boards: Time to Act on Climate Change – Carrier Management

96) Rutgers to offer graduate certification in real estate

97) Yields rise to session highs after US home prices data | Reuters

98) China Housing Market | Nanjing Real Estate | Knight Frank

99) Top 15 Tax Deductions for Landlords

100) OH SNAP! The Real Estate Professional's Guide to Landscape Photography – REtipster com

101) The New Cold Currency War | PIMCO Blog

102) Ex-nanny for Pen gets 5-year term | News, Sports, Jobs – Morning Journal

103) Richmond Hill defendant Monserrate Shirley gets 50 years

104) Anchorage Husband and Wife Convicted of Wire Fraud for Faking Burglary | USAO-AK | Department of Justice

105) Caldwell Man Sentenced for Insurance Fraud

106) Man gets prison for arson fire

107) New High-Tech Ways to Catch Burglars [and more]

108) Texas Hail Losses Set Record in 2016

109) Oklahoma Creates Fracking Guidelines with Goal of Reducing Quake Risk

110) California Attorney General Sues Feds in Offshore Fracking Challenge

111) Pending US Existing-Home Sales Fall on Higher Mortgage Rates – Bloomberg

112) As home prices rise, house-flippers stage comeback – MarketWatch

113) The Wrong Kind of UBI

114) Jeffrey P. Snider Blog | Economists Canada Problem | Talkmarkets

115) China to rein in outward investment as domestic growth stalls | Business | The Guardian

116) Illinois Supreme Court Clarifies Sidewalk Snow Removal Law

117) China Hits a Fork in the Road

  1.    Here are the 25 cities with the biggest rent hikes | 2016-12-09 | HousingWire

    Add your comment. Including the article/link number will help.


  2.    How a wind tunnel that recreates hurricanes makes homes safer – Curbed

    The suggested changes in building codes are rather affordable versus the costs of doing nothing new.

    Add your comment. Including the article/link number will help.


  3.    Trump's housing secretary Ben Carson only has one opinion about housing: policies to desegregate are wrong — Quartz

    "Every city and town in a metropolitan area should be required to ensure that the new housing built reflects the income distribution of the metropolitan area as a whole," rather than concentrating low-income housing in low-income areas.

    What do you think?

    Add your comment. Including the article/link number will help.


  4.    What China's Capital Controls Mean For Global Real Estate

    Rumor has it that China is going to clamp down on outbound investment. What does it mean for the billions of dollars flowing into American real estate by Chinese nationals?

    Add your comment. Including the article/link number will help.


  5.    Investor snaps up 2 Far North Dallas apartment communities | Real Estate | Dallas News

    Presidium has completed more than $250 million in real estate acquisitions in 2016.

    The investor, with offices in Austin and Dallas, operates more than $1 billion in real estate in the southern U.S.

    Add your comment. Including the article/link number will help.


  6.    Trump effect: That house you want got $16,000 more expensive since he won

    If I were at the Fed and actually agreed with the monetarist approach, I still wouldn't touch a rate hike this year and probably not for the 1st half of 2017 if then. I would not even think about it before seeing real heating. So far, it's all been talk and no real basis for heating. Trump's plans are so up in the air and so subject to others fighting it (others in positions of power) that it just makes no sense to raise rates right now at all.

    Add your comment. Including the article/link number will help.


  7.    Greece must reform or leave eurozone, says German minister | World news | The Guardian

    So long as Wolfgang Schäuble remains in office and unchanged (and he's not going to change), Greece has no humane choice but to leave/exit.

    Alexis Tsipras was completely wrong not to implement Yanis Varoufakis's plan.

    Add your comment. Including the article/link number will help.


  8.    Vancouver Tax Pushes Chinese to $1 Million Seattle Homes – Bloomberg

    They are skewing the median.

    Add your comment. Including the article/link number will help.


  9.    4 All-Too-Common Real Estate Scams Making Headlines

    Add your comment. Including the article/link number will help.


  10.    Residents Return to Tennessee City Demolished by Fire

    … Sevier County Mayor Larry Waters raised the death toll to 13 and said the number of damaged buildings now approached 1,000.

    Add your comment. Including the article/link number will help.


  11.    Pair indicted on 2 counts of arson, insurance fraud – The Blade

    Fire investigators found multiple points of origin for the fire ….

    Add your comment. Including the article/link number will help.


  12.    Sea ice hits record lows | Arctic Sea Ice News and Analysis

    Average Arctic sea ice extent for November set a record low, reflecting unusually high air temperatures, winds from the south, and a warm ocean. Since October, Arctic ice extent has been more than two standard deviations lower than the long-term average. Antarctic sea ice extent quickly declined in November, also setting a record low for the month and tracking more than two standard deviations below average during the entire month. For the globe as a whole, sea ice cover was exceptionally low.

    Add your comment. Including the article/link number will help.


  13.    Officials Investigate Massachusetts Fire That Damaged 15 Structures

    Add your comment. Including the article/link number will help.


  14.    Fordham Real Estate institute | NYU Schack

    Add your comment. Including the article/link number will help.


  15.    A Primer on Equilibrium | Uneasy Money

    This is good.

    I believe there is no such equilibrium, as my readers know.

    Add your comment. Including the article/link number will help.


  16.    Apartment Vacancy Rate Stays Low, Surprising Researchers

    The end to new construction is also in sight. Developers are now planning fewer new apartments for 2018. "The number of units delivered in 2018 could drop some—those units are in the pre-development and planning stage right now," says Sebree. "New construction is pulling back, but that's not being determined by the builders, it's being determined by the lenders."

    These lenders are asking developers to contribute more equity to their projects and are also applying more conservative underwriting standards.

    Add your comment. Including the article/link number will help.


  17.    Study Predicts Warming Will Trigger 3 Times as Many Extreme Downpours in U.S.

    … you might have a much higher potential for flash floods. This can have really big impacts."

    Add your comment. Including the article/link number will help.


  18.    Officials: Landlord May Face Citations after Ohio Fire Kills 4

    … they're considering whether the rental property's owner should be cited.

    Add your comment. Including the article/link number will help.


  19.    Why Trade Deficits Matter – The Atlantic

    Large tariffs like the ones Trump has proposed won't work….

    They need to say why not.

    Add your comment. Including the article/link number will help.


  20.    The American Dream, Quantified at Last – The New York Times

    The bad news is that lifting G.D.P. growth is terribly difficult. Trump has promised to do so, but offered few specifics. If anything, he favors some of the same policies (deregulation and tax cuts) that have failed in recent decades.

    The better news — potentially — is that lifting growth is the less important half of the equation, notes Nathaniel Hendren of Harvard, another of the researchers: The rise of inequality has damaged the American dream more than the growth slowdown.

    One way to think about inequality's role is to remember that the American economy is far larger and more productive than in 1980, even if it isn't growing as rapidly. Per-capita G.D.P. is almost twice as high now. By itself, that increase should allow most children to live better than their parents.

    They don't, however, because the fruits of growth have gone disproportionately to the affluent.

    The painful irony of 2016 is that nostalgia and anger over the fading American dream helped elect a president who may put the dream even further out of reach for many people — taking away their health insurance, supporting ineffective school vouchers and showering government largess on the rich. Every one of those issues will be worth a fight.

    Add your comment. Including the article/link number will help.


  21.    Manhattan Apartment Landlords Prop Up Market With Incentives – Bloomberg

    Add your comment. Including the article/link number will help.


  22.    Tales from the Seattle housing market: Modest home almost gets $1 million – Curbed Seattle

    … "the fact that a modest home on a busy street could sell for almost a million dollars is pretty insane."

    Add your comment. Including the article/link number will help.


  23.    City is stepping up to address homelessness in West Seattle; but many residents remain distrustful | West Seattle Herald / White Center News

    It amazes me how poorly society handles this issue. It's as if helping people encourages them to be what they're being helped out of. Of course, the federal government, with its power to create money out of thin air, could fix the problem (for all practical purposes). What kind of minds don't want it fixed? I can imagine but don't even like to feel the feelings those minds must have.

    Add your comment. Including the article/link number will help.


  24.    Kent City Council considers law to protect low-income tenants | Kent Reporter

    The national funding is only enough to cover about one out of five eligible households.

    With the high demand for apartments in a strong economy, landlords haven't had any trouble filling up units so some have looked to go away from people who receive government assistance, in part because they no longer would be subject to apartment inspections as part of the Section 8 program, Norman said.

    "There is a level of stigma against Section 8 voucher holders," Norman said. "There is a prejudice out there that associates Section 8 with poverty and crime. But when you dig down into it we're not seeing anything to back that. …."

    Under the new Renton law, landlords are subject to fines if they discriminate against a renter or potential renter who receives Section 8 housing.

    Add your comment. Including the article/link number will help.


  25.    Ruling expected on attempt to block Seattle's expansion of mother-in-law units | The Seattle Times

    The legislation would allow the units to be built on smaller lots, remove a requirement that each accessory unit have its own off-street parking space, allow a mother-in-law and a cottage to be built on the same lot, increase the maximum height of cottages and allow property owners to live off-property after six months.

    If people are opposed to this, they should work hard for adequate affordable housing in general.

    Add your comment. Including the article/link number will help.


  26.    Consumer sentiment soars as election dust settles, University of Michigan says – MarketWatch

    Well, demand-side is certainly important; however, I want credit stats with this info. We don't need people over extending themselves in the hope of an economic miracle that could be long in the making.

    What's Trump's plan so far?

    He wants to repatriate US dollars by lowering the US corporate-tax rate. He wants that repatriated money to flow into public-private partnerships, which is a euphemism for privatization. Plus he wants to reduce tax loopholes to supposedly match the lowering of income taxes on the wealthy. Of course, the wealthy will benefit from the corporate tax cuts in the first place. He also wants to impose high tariffs on imports from US companies that flee and fled overseas. Finally, he wants to allow the US carbon-fuel industries to increase global warming all they want.

    All of that is subject to change, as that's Trump's style (not a bad thing if he heads in the right direction — a huge if).

    Add your comment. Including the article/link number will help.


  27.    Why China Can't Stop Capital Outflows – Bloomberg View

    … the government is concerned about the implications of further liberalizing. China's rickety banks, with delinquency rates of 30 percent, are receiving regular liquidity injections from the People's Bank of China. Money market rates have been rising, from under 2 percent this summer to above 2.3 percent in Shanghai today. Allowing international capital mobility could easily trigger larger withdrawals — and hence liquidity crunches for banks already feeling the pinch of bad loans.

    In other words, China is caught between trying to prop up a currency facing long-term decline and letting capital leave at will, risking a bank crisis.

    This is an unenviable position. But the government needs to accept that the days when it could micromanage its currency to run massive trade surpluses while accumulating large foreign-exchange reserves are history.

    That's not the real reason. The real reason is dictatorial power of the Chinese Communist Party. To join global mixed-capitalism for real would mean Xi and his CCP losing all power.

    Add your comment. Including the article/link number will help.


  28.    Audit: Vacant properties should pay fire assessment – News – Daily Commercial – Leesburg, FL

    Think your local fire department/service doesn't matter much?

    Add your comment. Including the article/link number will help.


  29.    Communal Living: Should Real Estate Developers Be Interested?

    Tenants have an opportunity to choose from three distinct layouts, with rental rates beginning at $850 per month with a one-year lease. That's well below the national median rate of $1,100 for a one-bedroom apartment. Each unit comes fully furnished and has its own private bathroom and kitchenette, and tenants have access to a common dining and cooking area.

    It must somewhat like college-dorm life (only quieter I hope).

    Add your comment. Including the article/link number will help.


  30.    Oops! Pittsburgh cites self over derelict properties | TribLIVE

    It's a matter of money, but still….

    Add your comment. Including the article/link number will help.


  31.    How to find and finance bank-owned properties

    We don't hear as much about this as we did when all-cash institutional buyers were swooping up tens of thousands of houses on auction. With many of them gone on to other pastures, have you taken a look at this segment lately? If so, what have you found?

    Add your comment. Including the article/link number will help.


  32.    UW professor: Seattle construction noise goes on too late

    Noise is a bigger health problem than the vast majority of people seem to realize.

    Add your comment. Including the article/link number will help.


  33.    City goes hi-tech with aerial lasers to track abandoned properties

    Good:

    The city also has new light detection and ranging (LIDAR) technology, which allows inspectors and L&I staff to look at aerial shots of homes and determine which might have collapsing roofs. The system, using laser imaging, shows a color range to signal height disparities across a property's roof.

    Properties normally show green or yellow, but orange blurbs indicate holes, Newell said.

    "With some, the trees cover the entire roof, and you wouldn't normally be able to see with normal imagery," Newell said. "This goes through that and you are able to identify holes."

    Add your comment. Including the article/link number will help.


  34.    City Council approves limits on renters' move-in costs, taking aim at housing crisis | The Seattle Times

    This will be interesting to watch unfold.

    Some said the legislation would prompt them to raise rents, while others warned that the legislation would push them to sell their properties.

    It will be a cost of doing business built into the rent rate. The idea why it would force anyone to sell escapes me.

    Add your comment. Including the article/link number will help.


  35.    Pinpointing the Bubble in China's Real-Estate Market – Bloomberg View

    Aboutt 90% of the time, I find Noah Smith too off. Not here:

    Homebuyers may not be borrowing like crazy, but real-estate developers and many other companies have. If slowing economic growth causes households to pull back on their housing purchases, it could be companies, and the banks that lend to them, that are on the hook. Even if Chen and Wen are wrong, and the housing market isn't a true bubble, a downturn could still wreak a lot of damage on the Chinese economy — and on all the economies around the world that are dependent on China.

    Add your comment. Including the article/link number will help.


  36.    Feds charge Ridgefield Park man in real estate fraud scheme

    Reportedly:

    He applied for three loans of $200,000 each with three different banks, according to court documents.

    But at the time the property's value was only $400,000, with a mortgage of at least $115,000 remaining on the property.

    Not knowing that applications for multiple loans were outstanding, the three banks gave Popoteur loans, with a total amount near $500,000.

    Add your comment. Including the article/link number will help.


  37.    Dollar Climbs to Strongest Since 2003 on Fed Path; Bonds Drop – Bloomberg

    The Fed pulled off forward guidance via a rate hike. The economy isn't doing better enough to merit it on the merits. What's going to happen when Trump's tax-cut-and-spend plan doesn't work as advertised? Has the Fed set us up for a recession it just doesn't believe is out there waiting for more of the same: Fed hikes? We have not solved the jobs/wages problem, not even close. Donald Trumps plan won't do it either.

    Add your comment. Including the article/link number will help.


  38.    Beware The UBTI Rule When Investing In Real Estate With Retirement Funds

    … for real estate investors looking to buy and sell multiple real estate properties in a year or use leverage, one must be conscious of the application of the UBTI tax rules.

    Add your comment. Including the article/link number will help.


  39.    Will surging mortgage rates weaken US home sales? | OregonLive.com

    The rise in mortgage rates was spurred by a sustained decline in U.S. government bond prices in the days after Trump's victory. Bond investors looked toward tax cuts and beefed-up spending to upgrade roads, bridges and airports under a Trump administration, which could fuel inflation. That would depress prices of long-term Treasury bonds because inflation would erode their value over time. The selling wave lifted bond yields, which move opposite to prices and influence long-term mortgage rates.

    Yep, that's how it works.

    Add your comment. Including the article/link number will help.


  40.    Mick Mulvaney: Trump's big cabinet surprise – Dec. 19, 2016

    Mulvaney doesn't like 'magical thinking': The Trump team argues that it is fiscally conservative because Trump will be able to grow the economy enough to pay for many of his tax cuts and other plans.

    Most economists call this "magical thinking."

    I agree with him but for different reasons than his.

    Add your comment. Including the article/link number will help.


  41.    Nobody, including the Fed, knows the lowest unemployment rate that's consistent with stable inflation – The Washington Post

    Totally agree:

    The CEA found that our ability to accurately identify u* (called NAIRU in their figure, shown below) has crashed and burned in recent years. The statistical confidence interval — a measure of certainty of the estimate and the shared area in the graph — around u* ranges from 0 to 6 percent.

    So, here's what I conclude from all this:
    • Low- and middle-income workers have little to show from this expansion. It is essential that they have a chance to reap the benefits of running a truly tight labor market.
    • Itty-bitty, fully expected rate hikes are not a huge deal, but it's still the case that such preemptive actions by the Fed, as they are intended to slow the pace of tightening the job market, could reduce the likelihood that these wage and income gains will occur.
    • Thus, if their rationale is that u is less than u*, then they have way too much faith in their knowledge of u*, and their unwarranted certainty could be costly to working families. We'd all be better off if they used inflation itself (actual and expected), not u*, as their guidepost.

    Add your comment. Including the article/link number will help.


  42.    Increasing rent, but still no fix for sprawling mold at QT Properties in Lyndale | City Pages

    This is a very risky thing to leave insufficiently addressed.

    It's important the tenants be taught about adequate ventilation of humidity from cooking and showering and the like. Even drying wet towels and clothing needs to be done properly. Of course, that's all assuming that such are the causes, which they may not be in this situation.

    In addition to a lack of enough ventilation, mold loves dirty surfaces upon which to grow. Even ceilings may need to be washed even annually or more depending upon the severity of growth.

    A landlord should consider installing electric exhaust fans in bathrooms and kitchens (not just grease trapping fans in the kitchen but a system that vents to the exterior of the building).

    The rental or lease agreement needs to cover the various issues and responsibilities too.

    Add your comment. Including the article/link number will help.


  43.    Construction Input Prices Plummet in November

    Construction cost increases are likely to prove more profound than what has been experienced in recent years….

    Add your comment. Including the article/link number will help.


  44.    Make Finance Servant, not Master — Prime Economics

    I mostly agree with this article (it's not radical enough):

    Ann Pettifor:

    Financial globalisation is the system whereby 'citizens of nowhere' — active in global capital markets — determine the life chances and living standards of citizens around the world. In other words, the system which permits financiers to use capital mobility to enjoy absolute advantages over all other sectors of a domestic economy, and which thereby elevates financiers to the position of masters not only of economies like Britain's but also of the global economy. Capital enjoys this power because unlike trade or labour, flows of capital face very few barriers to movement, and can therefore quickly migrate to where returns or capital gains are highest. By contrast, flows of trade and labour face geographic, political, regulatory, physical and even emotional barriers to movement. It is this that makes capital dominant over trade and labour in the global economy, and increasingly so in a domestic economy like Britain's.

    And it is this dominance of finance over the real economy that has persuaded many industrial capitalists that if 'you can't fight 'em, join em'. The result is that the economy has become increasingly financialised; Capitalists have tried to find ways of mimicking the finance sector's ability to make gains effortlessly from debt and speculation. They make large amounts of their profits by accumulating unearned income from 'rent' on pre-existing assets, including land, houses, commercial buildings, vehicles, databases, brands, works of art, yachts etc. Those that do not own pre-existing assets that can be rented out are obliged to earnincome — invariably from their labour.

    Financial globalisation has weakened and unbalanced the British economy, and that in my view, explains more fully the Brexit vote. For it is my contention that financial globalisation has led to the decline of British industry, the decline in investment, the rise in unemployment or insecure employment, and to the fall in labour's share of the economy. Above all, it is financial globalisation that has caused regular, overlapping and increasingly catastrophic crises.

    The result of the new unmanaged 'growth' strategy of the 1970s was disastrous: a decade of uncontrolled inflation followed, as management of the exchange rate was abandoned, and as too much 'easy' money chased too few goods and services. 1970s inflation is always wrongly blamed on Maynard Keynes and the unions, but in truth these policies were anti-Keynesian. It was the 1971 decision to remove controls over bank lending that caused a massive expansion of credit (often for speculation) and that fueled inflation. The almost simultaneous decision by Britain's public authorities to abandon responsibility for managing the exchange rate, and instead to switch to 'flexible exchange rates' meant that sterling fell 16% between 1971 and 1974. Import prices rose by 79%; consumer prices by 35%. The unions tried to ensure wages kept up, but they were to be defeated. Loss of control over bank lending was a key factor in 70s inflation, but so was the now out-of-control exchange rate.
    [also the oil and wheat crises]

    For as Keynes once famously argued:
    "Ideas, knowledge, science, hospitality, travel—these are the things which should of their nature be international. But let goods be homespun whenever it is reasonably and conveniently possible, and, above all, let finance be primarily national."

    Add your comment. Including the article/link number will help.


  45.    United States Capacity Utilization | 1967-2016 | Data | Chart | Calendar

    Capacity Utilization in the United States decreased to 75 percent in November from 75.40 percent in October of 2016. It was the lowest rate since March. Capacity Utilization in the United States averaged 80.35 percent from 1967 until 2016, reaching an all time high of 89.40 percent in January of 1967 and a record low of 66.89 percent in June of 2009.

    Add your comment. Including the article/link number will help.


  46.    United States Nahb Housing Market Index | 1985-2016 | Data | Chart

    The NAHB Housing Market Index in the United States rose to 70 in December from 63 in November of 2016 and above market expectations of 63. It was the highest reading since July 2005….

    Add your comment. Including the article/link number will help.


  47.    United States Households Debt To Gdp | 1952-2016 | Data | Chart | Calendar

    Households Debt in the United States increased to 78.80 percent of GDP in the second quarter of 2016 from 78.40 percent of GDP in the first quarter of 2016. Households Debt To Gdp in the United States averaged 56.21 percent of GDP from 1952 until 2016, reaching an all time high of 95.50 percent of GDP in the fourth quarter of 2007 and a record low of 23.40 percent of GDP in the first quarter of 1952.

    Add your comment. Including the article/link number will help.


  48.    How to Prevent (& Deal With) Mold in Your Rental Properties

    Well, since I posted a mold article above, this one from Brandon Turner is very timely (plus, it's funny).

    Add your comment. Including the article/link number will help.


  49.    mainly macro: Reactionary Keynesianism

    Simon Wren-Lewis:

    If tax cuts for the rich just raise the deficit with almost no short run demand boost, then that is a transfer to the rich today from the non-rich tomorrow. If tax cuts for the rich were paid for by tax increases on everyone else today many politicians would be up in arms. Delaying the tax increase on everyone else by borrowing is a trick that should be seen straight through.

    Yet I fear this is still not the case, and talking about tax cuts for the rich as part of a stimulus just helps confuse politicians. Those on the right understand this: tax cuts for the rich are nearly always part of a general stimulus: when Nigel Lawson did this it helped bust the UK economy. We should just repeat again and again: tax cuts for the rich paid for by borrowing are really tax increases for everyone else.

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  50.    Trump creates new position for China hawk in White House | Washington Examiner

    Navarro, who holds an economics doctorate from Harvard University, provided the intellectual justification for Trump's assertions that he could boost U.S. employment and wages while reducing the deficit by renegotiating the terms of American trade with China.

    That is certainly not a completely unfounded position. In fact, I believe it's correct if done properly. However, it's the rest of Trumps economic ideas that give me more than pause. I'm speaking specifically about his tax-cut plans coupled with massive privatization of the economy. To me, it's a terrible idea designed to benefit the rich at the further expense of the lower classes (who, unfortunately, still might be placated).

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  51.    Fewer properties go unwanted at St. Louis tax auctions | Political Fix | stltoday.com

    … his business model, which requires a high volume of properties to account for the smaller profit on individual homes in a distressed market, as well as the risks inherent when buying properties at tax auctions — namely that it's often impossible to determine the interior condition of a property before buying it. Buildings also may be broken into and damaged before a tax sale investor finds a tenant or buyer.

    An intact exterior can mask extensive, costly damage inside, and a handful of Vroman's properties have required so much rehab work that the project isn't economically feasible, so he just lets them sit. In some instances, for homes that are in better condition, he's started renting them on Airbnb while he looks for a buyer.

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  52.    Seattle shocker: Market forces can work | The Seattle Times

    If there's to be any capitalism at all, it sure should be this kind.

    This is the market working at its most elegant and effective: demand and supply, price discovery and response. Want more affordable housing? Build more housing stock. Don't treat developers and landlords as class enemies.

    In many parts of America, market worship with the nihilistic Ayn Rand ideology ("economic freedom!) will be at work in the new administration, with disastrous results. An influential part of Seattle is very good at protest theater, shouting down opposing views and declaring everything a "crisis," perpetuating and incentivizing many of them. We might be better served by finding ways to channel market forces for the widest possible good.

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  53.    mainly macro: When is an economic recovery not a recovery?

    … many important questions, which those who read economics blogs will be very familiar with: has the financial crisis had a permanent negative effect on productive potential, was the pre-crisis period really a disguised boom, are we suffering from secular stagnation, what role did austerity play?

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  54.    The Italian Banking Crisis: No Free Lunch — Or Is There? | WEB OF DEBT BLOG

    ECB and EC officials claim that "there is no free lunch" and "no alternative," says Werner. But there is an alternative, one that is cost-free to the people and the government. The European banks could be rescued by the central bank, just as US banks were rescued by the Federal Reserve.

    To avoid the moral hazard of bank malfeasance in the future, the banks could then be regulated so that they were harnessed to serve the public interest, or they could be nationalized. This could be done without cost to the government, since the NPLs would have been erased from the books.

    For a long-term solution, the money that is now created by banks in pursuit of their own profit either needs to be issued by governments (as has been done quite successfully in the past, going back to the American colonies) or it needs to be created by banks that are required to serve the public interest. And for that to happen, the banks need to be made public utilities.

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  55.    #TheMostSeriousSmog of the year when China boosts economy with coal

    It's nothing short of insane.

    One of those stations in Shijiazhuang city also measured more than 1,000 micrograms per cubic meter of PM2.5 — toxic airborne particulates — on Monday. According to the World Health Organization, maximum daily exposure to PM2.5 should not exceed 25 micrograms per cubic meter, but even on a good day, many Chinese cities exceed that.

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  56.    The American School of Economics

    Trump's read: If he weeds out the libertarian nonsense in his plan, … the American School of Economics (needs proofreading/editing)

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  57.    The American System of Economics | American Jobs Alliance

    All the men on Mt. Rushmore, and many other very notable US leaders, were for it: The American System of Economics | American Jobs Alliance:

    … the United States government, under both Democratic and Republican administrations, abandoned the American System, the economic policy that made us the greatest industrial power on earth. We began demolishing many trade barriers under the flag of "free trade." This coincided with the collapse of domestic industries, the stagnation of working peoples' wages, and an explosion of the trade deficit as the US imported more and more goods that had been produced domestically. The losses of revenues from domestic industries, now bankrupt, and from payroll taxes on the wages of workers now unemployed, created yawning budget deficits at the municipal, state and federal levels.

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  58.    Seattle Is Creating a Ton of Low-Income Housing. How Do We Decide Who Gets It? | Seattle Weekly

    … if you're a household of one and you make $50,000 per year, you're considered low-income ….

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  59.    Greece is rock bottom in EU's social justice rankings | Business | ekathimerini.com

    Alexis Tsipras was dead wrong. Yanis Varoufakis was right.

    As far as I'm concerned, Yanis should challenge Tsipras for leadership of Greece.

    Yanis should spell out exactly what steps Greece should take to get out from under Germany's yoke of ordoliberalism choking Europe. If that means reneging on all the onerous debts taken on by earlier corrupt Greek governments, then so be it.

    His people are needlessly suffering. He knows it and knows how to end it.

    Fix it! Convince your people.

    … 35.7 percent of the population faces the risk of poverty, with the figure for children even higher, at 37.8 percent, from 36.7 percent in 2014. The percentage of children living in conditions of serious material deprivation has grown to 25.7 percent from 23.8 percent in 2014 and 10.4 percent in 2008.

    Save them.

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  60.    Indian Banks' Poisoned Chalice – Bloomberg Gadfly

    The initial premise of demonetization was that a big chunk of cash would be too tainted to dare return to the banking system, and canceling those liabilities would generate a bumper profit for the government. With most old currency deposited into accounts or exchanged into new money, however, that hypothesis has been shredded. …

    It's hard to believe Prime Minister Narendra Modi didn't think through these unintended consequences. What's even scarier is the possibility that he did, and topped up the banking industry's chalice regardless.

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  61.    London House Prices Are Having Their Worst December in Years – Bloomberg

    Letting some air out of the bubble:

    In a sign of the disparity within the city, average prices in inner London are down 2.6 percent over the past year, whereas outer areas are up 2.7 percent. That left average prices across the capital little changed. The split partly reflects the luxury end of the market, where an April tax increase on property investors and worries about Brexit are sapping demand.

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  62.    Greece faces permanent crisis as IMF warns bail-out plan 'simply not credible'

    The IMF said only by broadening the tax base in a country in which more than half of households are not required to pay any income tax, and spending less on pensions could it sustain a recovery.

    "In an effort to boost revenues, Greece has followed a policy of repeatedly hiking already high tax rates, instead of broadening the tax base. It has not worked," Mr Thomsen wrote in a separate post.

    "Simply put, Greece cannot modernise its economy by boosting funding for infrastructure and well-targeted social programs while exempting more than half of households from income taxes and paying public pensions at the level of the richest European countries," the officials wrote.

    That position is utter hogwash, and Yanis Varoufakis knows it.

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  63.    Final EPA Study Confirms Fracking Contaminates Drinking Water

    In the new report, the EPA has identified cases of impacts on drinking water at each stage in the hydraulic fracturing water cycle:

    • Water withdrawals for hydraulic fracturing in times or areas of low water availability, particularly in areas with limited or declining groundwater resources;
    • Spills during the management of hydraulic fracturing fluids and chemicals or produced water that result in large volumes or high concentrations of chemicals reaching groundwater resources;
    • Injection of hydraulic fracturing fluids into wells with inadequate mechanical integrity, allowing gases or liquids to move to groundwater resources;
    • Injection of hydraulic fracturing fluids directly into groundwater resources;
    • Discharge of inadequately treated hydraulic fracturing wastewater to surface water resources; and
    • Disposal or storage of hydraulic fracturing wastewater in unlined pits, resulting in contamination of groundwater resources.

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  64.    Someone Has to Tell John Williams Inflation Is Not Accelerating | The Center for Economic and Policy Research

    I agree:

    We have numerous pieces raising serious questions about whether the labor market is really at full employment, noting for example the sharp drop in employment rates (for all groups) from pre-recession levels and the high rate of involuntary part-time employment. But the story of accelerating inflation is also not right.

    It is reasonable to pull shelter out of the CPI because rents do not follow the same dynamic as most goods and services. In fact, higher interest rates, by reducing construction, are likely to increase the pace of increase in rents rather than reduce them.

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  65.    US sues Barclays for alleged mortgage securities fraud

    Loans had been made to borrowers with no ability to repay and were based on inflated home appraisals, the complaint said.

    That was the standard operating procedure for the mortgage industry in general.

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  66.    Greek PM in Open Confrontation with German FinMin | GreekReporter.com

    … the German minister explained further: "Solidarity can only be justified when the aid is limited and leads to change something in a positive direction. In Ireland, Portugal, Spain and Cyprus that was evident. After implementing the program, their economies are growing, rapidly for some.

    What has happened in Ireland, Portugal, Spain, and Cyprus is not what should have happened vis-a-vis the rest of Europe and especially Germany. Ordoliberalism did not fix anything in any of those countries. It didn't even mask over the wounds. Schaeuble is a master at avoiding discussing economics on a wider scale. He has mastered it so the German economy can do what he thinks is prosper. It is prospering in his view but doing so only at the needless expense of other nations. It could prosper much more by dropping ordoliberalism (which is really neoliberalism inflicted on others. He lacks vision.

    The system in Europe was designed to benefit Germany.

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  67.    Shanghai water supply hit by 100-tonne wave of garbage | World news | The Guardian

    Although parents complained for months, local officials ignored their claims and disputed any connection despite levels of chlorobenzene, a highly toxic solvent that causes damage to the liver, kidney and nervous system, nearly 100,000 times above the safe limit.

    The lack of democracy in China is not a good thing. The People do not have the authority they need to replace the poor leadership that has allowed this sort of thing to continue happening.

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  68.    Corporate Welfare Won't Create Jobs – The New York Times

    Under "normal" circumstances, I'd completely agree with this article. I've even written myself that Donald Trump's plan will not work as he advertises it will. That said, I've been basing my own statements on the same void this NYT article, by Frank Clemente, does.

    The fact is that none of us can be sure of exactly what will happen. We don't know what Donald Trump has fully in mind or how he will react to events as those unfold.

    What is clear is that he's constantly set up, or setting up, for negotiations. We also have seen that he's deliberately very fluid.

    Frankly, it's difficult to discern his core beliefs. Obviously, some of his positions are less fluid or flexible than are others; however, that doesn't tell us as much in his case as it typically has with others. Barack Obama was vastly easier to predict. Frankly, in my lifetime, I can't think of another politician in a high place more difficult to predict (except in rather general terms) than Donald Trump, so far.

    Concerning doing the favors for corporations he's planning, what strings will he seek to attach? What sticks will he pull out and use if those corporations don't react in ways that will aid Donald Trump in pulling off his promises? We really don't know. We also don't know how quickly or radically he might change in the face of corporate obstinacies.

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  69.    Milton Friedman is dead, and really misunderstood • The Berkeley Blog

    Maximilian Auffhammer:

    … Milton Friedman. Friedman, who was one of the most brilliant thinkers of this past century ….

    … I hope that the GOP and Trump administration will relearn what free market economics is all about. It's not about the absences of regulation. It's about sensible regulation.

    I'm not going to apologize for always having believed that Milton Friedman was not very bright. Leaving that aside, "free-market economics" is definitely not about sensible regulation. It's about anarchy.

    Now that I'm done "attacking" Maximilian Auffhammer, he's basically correct. Where I disagree on a more subtle note concerns his concept of Econ 101 and cost-benefit analysis.

    Pollution, in the sense he means, is never good, per se. This is important because we, as humanity, can achieve all the benefits we both need and want without the negatives. There need be zero tradeoffs.

    It's a deep subject beyond the scope of this news aggregation/commentary, but feel free thoughtfully to raise the issue in the comment section.

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  70.    Fed Turns Hawkish – Tim Duy's Fed Watch

    It is almost as if the Fed is drawing a line in the sand with an increased confidence that they have the correct natural rate estimate. Their tolerance for further declines below that line is wearing thin.

    I don't think "It is almost as if" but that, that is exactly the Fed view while the Fed remains open to changing its mind based upon what actually happens. I think they're wrong and suspect Tim does too.

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  71.    When It Comes to Trumponomics, Economists Are on High Alert | The Fiscal Times

    Mark Thoma:

    Republicans claim that tax cuts for the wealthy will spur economic growth, and that benefit of higher growth will be far larger than the programs that must be sacrificed to pay for the reduction in taxes. But we don't need fancy theoretical macroeconomic models to evaluate this claim about tax cuts and economic growth, the empirical evidence is quite clear. The idea that tax cuts will spur economic growth finds very little support when tax cuts in the past are evaluated.

    … But if the evidence on the costs and benefits is evaluated honestly, I don't believe that most of the policies that Trump has suggested — infrastructure spending done correctly is perhaps an exception — can be supported.

    If Trump has nothing else planned to force those receiving the tax cuts to invest in investments that will truly multiply the economy for the general welfare of all, then Mark is absolutely correct.

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  72.    Jeb Hensarling and the Allure of Economism | The Baseline Scenario

    … the people who are most captivated by the first theorem of welfare economics (the one that says that competitive markets produce optimal outcomes) are often the least good at remembering the assumptions that don't apply and the caveats that do apply in the real world.

    Exactly!

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  73.    Larry Kudlow and Economics in the Trump Administration | The Baseline Scenario

    James Kwak:

    Most of Kudlow's thinking about economic issues appears to boil down to three ideas. The first is that tax cuts increase economic growth—a mantra that conservatives have repeated for decades, yet is not supported by reviews of existing research. The second is that expanding the money supply will necessarily generate high inflation, on which basis Kudlow predicted a "major inflationary plunge" just as the Great Recession was beginning. The third is that an expensive currency—what politicians call a "strong dollar," but Kudlow calls "King Dollar" (with the capitals)—is good for the economy.

    The first two ideas are things you would expect to hear from a first-semester college freshman (like Jeb Hensarling in his Texas A&M days). They make sense on a two-dimensional diagram, but they are at best distant approximations of how the world works. The third—King Dollar—is just weird. The value of a currency is the outcome of various factors, such as interest rates, and it doesn't make sense to think of that outcome in isolation from the things you would need to do to produce that outcome.

    I had previously referred to Larry Kudlow elsewhere as Donald Trumps worst appointment. I still believe that to be true.

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  74.    The Crisis of Market Fundamentalism

    I don't know that I've ever read an article by Anatole Kaletsky that didn't set me to thinking and didn't impress me concerning scope.

    … the fatal contradiction between social benefits and individual losses can no longer be ignored. If trade, competition, and technological progress are to power the next phase of capitalism, they will have to be paired with government interventions to redistribute the gains from growth in ways that Thatcher and Reagan declared taboo.

    Big if. Frankly, I don't think so. I think democracy must replace "capitalism." We argue over the concept of "democratic capitalism," but I will emphasize the purest form of democracy we can manage and believe that it would mean public ownership. The question would be how large the public unit. Ultimately, global ownership is what I see. How long will it take to get there? I don't know.

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  75.    Ayn Rand and Corporate Tax Cuts Won't Mend the Economy – The New Yorker

    … the Randian theory now being trumpeted was put to the test, not very long ago, and it failed. In 2004, the Bush Administration introduced a "tax holiday" for corporations that repatriated profits they were holding abroad, arguing, much as Kudlow, Cohn, and others are now, that it would spur capital investment and job growth. What actually happened, according to a Senate subcommittee that surveyed twenty leading multinational companies, was that "the 2004 repatriation tax provision was followed by an increase in dollars spent on stock repurchases and executive compensation."

    You see there the consistent and correct theme in opposition to Trump's analysis and plan. How is Trump going to stimulate the right investments?

    We've heard privatization and public-private enterprises bandied about, but nothing specific. Plus, a great deal of privatization turns out to be nothing more than schemes to further line the deep pockets of those not interested in providing the best public services but rather in simply getting richer and then hoarding it.

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  76.    Democracy Against Domination: Overcoming Economic Power and Regulatory Failure in the New Gilded Age –

    K. Sabeel Rahman is headed in the right direction.

    … we might institutionalize more participatory mechanisms into the design of regulations themselves. Consider the example of the Community Reinvestment Act. For the brief time while the Act was enforced effectively, it included a provision that allowed civil society groups to trigger inspections of banks that the communities felt were neglecting local credit needs. This small provision, in cities where communities were well-organized, proved enough of a lever to force both lax regulators and skeptical banks to respond more directly to the needs of local residents. There is a rapidly growing literature on participatory governance mechanisms and designs through which a wider range of constituencies can be empowered to play a more direct role in the monitoring, enforcement, and revision of regulations.

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  77.    Sinkhole opens up in suburban Detroit, damages home

    Some 55 feet underground is an 11-foot-wide sewer line, "the biggest one they have," he said.

    "You get a break in that line, it's just washing away dirt down there. It creates a void," Pettyes said. "When it creates a void, it moves the dirt out. The ground gives way."

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  78.    Economists versus the Economy

    Fabulous questioning by Robert Skidelsky:

    Let's be honest: …

    With virtually no usable macroeconomic tools, the default position is "structural reform." But no one agrees on what it entails. Meanwhile, crackpot leaders are stirring discontented voters. Economies, it seems, have escaped from the grasp of those supposed to manage them, with politics in hot pursuit.

    … The giants of earlier generations knew a lot of things besides economics. Keynes graduated in mathematics, but was steeped in the classics (and studied economics for less than a year before starting to teach it). Schumpeter got his PhD in law; Hayek's were in law and political science, and he also studied philosophy, psychology, and brain anatomy.

    Today's professional economists, by contrast, have studied almost nothing but economics. They don't even read the classics of their own discipline. Economic history comes, if at all, from data sets. Philosophy, which could teach them about the limits of the economic method, is a closed book. Mathematics, demanding and seductive, has monopolized their mental horizons. The economists are the idiots savants of our time.

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  79.    The Bairoch conjecture on tariffs & growth | pseudoerasmus

    There is a vast cross-country literature which finds a positive correlation between economic growth and various measures of openness to international trade in the post-1945 period. Despite intense methodological bickering amongst researchers, nonetheless maybe 50 studies (maybe more?), using a variety of methods and approaches, come to the same conclusion: trade openness was associated with growth after 1945. (This amazing critical survey lists most of those studies.)

    This huge body of research does have some quite compelling critics, the most prominent being Rodríguez & Rodrik (2000). This widely cited paper argues — amongst many other things — that there is no necessary relationship between trade and growth, either way. It depends on the global context as well as domestic economic conditions. I think that view is correct.

    So do I.

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  80.    Obama's legacy is a devastated Democratic Party | New York Post

    I am going to zero in on the following:

    … Americans grew disgusted by such outrages as a non-stimulating $831 billion "stimulus," eight consecutive years of economic growth below 3 percent, an 88 percent increase in the national debt, the revocation of America's triple-A bond rating ….

    Most thinking, knowledgeable, non-propagandistic Americans know full well that the stimulus was only mistaken for being much too small. That's why growth was anemic. It's also why the national debt wasn't reduced over the timespan. As for the bond rating, we shouldn't be issuing such bonds in the first place.

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  81.    The Long-Term Jobs Killer Is Not China. It's Automation. – The New York Times

    This is another in a long line of understated articles on the automation revolution.

    Contrary to the claims of this article, there is not one paying job that will not be able to be replaced by automation. The only block will be the human choice to preserve jobs for humans.

    Personally, I'm positive the real issue is income. We must face the fact that a solid income will need to be provided to everyone, not a "basic" income at the poverty line but rather an income that will allow the recipient to have a full economic life.

    Eventually, money will be completely archaic. Until then, we need a universal income and the sooner the better.

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  82.    9 Ways To Maximize Profit On Your Rental Property | SmartMove

    An overview for the novice

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  83.    John Mauldin — Brace Yourself For Italy's Bankruptcy

    Yes, but it's German ordoliberalism that's the real problem and always has been.

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  84.    The Bank of Canada just laid out how the economy could tank – Macleans.ca

    There is good news, Slive says. Stress tests show Canada's big banks will be just fine even with a large drop in house prices. It's also important to note that the Bank, in its financial system review, said there is a "low probability" of a sharp correction in house prices. …

    If there's one quibble to be made, it's with the initial domino that the Bank sees setting everything in motion—a severe recession leading to job losses. Since the U.S. housing bubble popped and that country went into its long, dark funk, a chicken-versus-egg debate has raged over whether the housing collapse triggered the U.S. recession, or whether something else, like soaring oil prices, brought on the recession and turned the housing slowdown into a total collapse.

    There is no such debate. There is only lying about the cause. The cause was toxic loans caused by wrong deregulation: financialization.

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  85.    Millions of Americans are stuck in part-time jobs – Equitable Growth

    … millions of working Americans cannot find a full-time job, and are forced to patch together an income through taking on one or more part-time jobs.

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  86.    Karl Polanyi for President | Dissent Magazine

    The election is over, but this is more than interesting.

    Whether or not Sanders has read Polanyi—similar language about economic and social rights was also present in FDR's New Deal, which Sanders argues is the basis of his brand of socialism—Polanyi's particular definition of socialism sounds like one Sanders would share:

    Socialism is, essentially, the tendency inherent in an industrial civilization to transcend the self-regulating market by consciously subordinating it to a democratic society. It is the solution natural to industrial workers who see no reason why production should not be regulated directly and why markets should be more than a useful but subordinate trait in a free society. From the point of view of the community as a whole, socialism is merely the continuation of that endeavor to make society a distinctively human relationship of persons.

    Sanders's particular notion of a political revolution—in which people use democracy to change the rules governing our national political economy—is very Polanyian. Polanyi's socialism has a certain modern appeal when the more traditionally Marxist idea of having the state seize the means of production has been abandoned even by most who identify as socialists. Instead, Polanyi's relevance for today lies in his arguments that markets need to be subjected to democratic control, that human beings resist being transformed fully into commodities, and a fully realized market society is both impossible, undesirable, and at odds with genuine liberty and freedom.

    Sanders's campaign has shown that a political platform favoring decommodification and a retreat from the extremes of society's subordination to markets has deep appeal.

    Polanyi was absolutely right that there is no such thing as a free market. All markets are determined by the state at this point. He was also right that human labor and land ought not be viewed as commodities, p er se.

    I came to those very conclusions independent of Polanyi, as I hadn't read him or ever heard of his positions before I arrived at them.

    To be fair, Polanyi didn't come up in a vacuum either.

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  87.    Philadelphia Fed Research Measures Impact of Gentrification on Low-Cost Housing Stock

    It's great to fix places up but not at the expense of compassion and assistance for the poor.

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  88.    Time To Turn The Page Of Platform Capitalism?

    Speaking of Polanyi:

    The gig economy may sound cool, but many of the jobs offer a fast track back to the problems faced by day labourers in the 1850s. …

    Is the whole platform economy only about fake democracy and biased conceptions of sharing? That was the impression of the London court which assessed in its landmark judgment that Uber drivers are not self-employed: 'Any organisation … resorting in its documentation to fictions, twisted language and even brand new terminology, merits, we think, a degree of scepticism.' The court called it a fiction that Uber operates with 30,000 independent contractors.

    Online platforms generate major spill-over effects: The corporate advantage of using crowdworkers can lower labour costs substantially since the platform is not providing a safety net — no social protection, unemployment insurance, sick leave or paid holidays as we've seen. An online labour platform such as 'Upwork' has just a few hundred employees overseeing 10m "freelancers" from all over the world, undercutting each other's wages. Where is the societal progress in producing ever more cheaply by cutting wages and safety nets?

    … This business model runs counter to de-commodification — or in the wording of the fundamental ILO principles: 'labour is not a commodity' (1944). The question is how to stop the erosion and corrosion of the employment relationship and the casualisation of labour. Karl Polanyi underlined that you must "be constantly on the watch to ensure the free working of the system" (The Great Transformation 1944).

    Can platform co-operativism generate better policy solutions? Co-ops have not played a transformational role in past decades. However, a new trend is emerging: often grassroots initiatives of young non-profit activists inventing new platform co-ops. Trade unions are starting to support such co-ops. Is it realistic to envisage that one day soon a broad network of co-ops could challenge the pla tform monopolies and create a different future? During a recent co-op conference in New York, encouraging signs emerged from many initiatives which have the advantage of shared aspirations and common values such as solidarity, cooperation and sustainability. While male-dominated techno giants tend towards a gender imbalance, co-ops could well enhance gender equality. While the giants extract value from people and nature, externalise costs and disempower labour, co-ops could invest in a circular economy and sustainability. While techno giants increase inequality (and profits), co-ops usually cap excessively high incomes — and lay the base for a rebirth of democracy and active participation.

    The tech giants must be aware that platform capitalism contributes to the sense of desperation that has crept into the workforce in industrialised countries, paving the way to anti-globalisation and anti-Silicon Valley rhetoric. If this new corporate model is left unregulated, it will further undermine democracy. Do we have to wait for a dysfunctional and techno-addicted European Commission to agree the necessary new deal?

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  89.    10 Things To Consider Before Buying Income Property | Bankrate.com

    Another article for the novice

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  90.    The 5 biggest lies of global capitalism | World Economic Forum

    Guy Standing:

    In the interests of competitiveness in a globalizing world economy, governments of all complexions introduced labour-market reforms that promoted flexibility, but accentuated the precariat's insecurities. They weakened regulations for banks and financial companies, enabling financiers to gain more income while pushing the precariat into greater debt. They strengthened property rights of all kinds — physical, financial and intellectual — that gave an increasing share of income and wealth to asset holders at the expense of everyone else. And they granted tax cuts for the rich and generous subsidies for corporations, while demanding reductions in public spending to balance budgets, cutting benefits for the precariat and lowering relative and absolute incomes.

    In each case, the argument was that the measures would boost economic growth, expanding the pie for all to share. Instead, almost all the gains have gone to a small global elite — who have, not surprisingly, pushed for ever more of the same. There has been no quid pro quo. …

    Modern capitalism is based on five falsehoods:

    1. The first lie is the claim that global capitalism is based on free markets. …

    2. The second lie is that strong intellectual property rights are required to encourage and reward the risks of investment in research and development. …
    3. The third lie is that strengthening property rights is good for growth. …
    4. The fourth is that rising profits reflect managerial efficiency and a return to risk-taking. …
    5. "Work is the best route out of poverty." …

    … First, it used to be the case that when productivity grew, wages grew in parallel; now, in the US and elsewhere, wages do not budge. Second, it used to be that when profits rose, wages rose; now, wages do not budge. Third, it used to be that when employment rose, average wages did so too; now, average wages can even fall, because the new jobs pay less.

    However hard those in the precariat work, they face slim prospects of escaping from a life of economic insecurity. And the longer that remains the inconvenient truth, the greater the danger that they will listen to post-truth authoritarian populists offering to turn back history. The only way to escape this "politics of inferno" is to build a new income distribution system suited to the 21st century.

    … is what I've been saying for years.

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  91.    New LA law will help tenants when their landlords offer buyouts – Curbed LA

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  92.    Germany has thousands of banks. The UK has just five, and it's strangling our economy. | The Co-operative Party

    There's clear evidence that Germany's banking system makes their economy more productive. Britain's big commercial banks focus on using our money to turn huge profits via trading activities — lending to each other and trading within the financial system itself. Not-for-profit banks such as the Sparkassen, on the other hand, exist solely to support activity in the 'real' economy — lending to small businesses, providing mortgages, and so on.

    The German model is better than the British but is still far from the best. The German model is Germanocentric and insufficiently democratic.

    Who needs an interest system? There's no good point in it at all.

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  93.    A new orientation away from neoliberalism | Real-World Economics Review Blog

    Human growth could be the idea that reunites the European nations behind the EU project, and replaces the neoliberal — in fact, anti-democratic — paradigm.

    There really is no other choice. It's either this or fail.

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  94.    Hawkish Fed Exacerbates Dollar Fears for Emerging Markets – Bloomberg

    The jump in the outstanding stock of dollar credit offshore means "dollar strength is a far greater restrictive influence than it has ever been during the era of floating exchange rates," as the premium for debt-servicing increases in local-currency terms, Gaurav Saroliya, economist at Lombard Street Research wrote in a note ….

    Citing the prospect of a slowdown in trade financing and cross-border bank lending, Saroliya concludes: "Before long, the Fed may have to seriously consider becoming a key provider of global dollar liquidity. Or runaway dollar strength will stop further [Fed] policy normalization right in its tracks."

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  95.    Insurance Boards: Time to Act on Climate Change – Carrier Management

    The largest insurers—those writing more than five billion in direct premiums—had the most proactive governance practices for climate change, including board oversight of climate and sustainability risks.

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  96.    Rutgers to offer graduate certification in real estate

    … design, land use, redevelopment and planning an exposure to developers' perspectives. Students with real estate experience will receive an immersive experience in urban planning."

    Currently the certification is only open to any Rutgers Master of City & Regional Planning or Master of Business Administration students. The program is designed so that students can complete a number of the 18 credits required for the certificate as a part of their coursework for their master's degrees. The initial course offerings for the Spring 2017 semester at the undergraduate level will be Real Estate Capital Markets and Real Estate Finance. At the graduate level the course offerings are Real Estate Finance, Real Estate Appraisal and Real Estate Law.

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  97.    Yields rise to session highs after U.S. home prices data | Reuters

    Longer-dated U.S. Treasury yields rose to session highs on Tuesday after the release of data on the U.S housing market that were slightly stronger than expected.

    And what does that mean? It means bond buyers are expecting generalized price inflation to outstrip bond yields at higher bond prices. Therefore, there is less demand for such longer-dated bonds (at the time of this article).

    Add your comment. Including the article/link number will help.


  98.    China Housing Market | Nanjing Real Estate | Knight Frank

    This is what happens when money hasn't many other places to go.

    Prices in the Chinese city of Nanjing, the hottest property market globally, were on average 42.9% higher in the third quarter of the year than they were a year earlier.

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  99.    Top 15 Tax Deductions for Landlords

    Good overview. Do your research though, as some tax strategies may be more aggressive than you'd feel comfortable with after such research.

    The article does mention potentially getting audited. Be prepared with proper documentation, including of your reasons (with citations of IRS publications) for taking whatever deductions you did.

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  100.    OH SNAP! The Real Estate Professional's Guide to Landscape Photography – REtipster.com

    This seems to be from last year (2015) but still serviceable.

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  101.    The New Cold Currency War | PIMCO Blog

    … benign neglect seems unlikely to survive Trump's first 100 days in office. A stronger dollar hurts the U.S. manufacturing sector and thus many of Trump's voters. Continued dollar appreciation may make it (even) more likely that Trump will make good on his campaign promise and start targeting foreign currency "manipulators" soon after taking office. If that happens, it could rattle risk assets, which are so far romancing the right-tail risk and downplaying the left tail ("more bark than bite") following the U.S. election. This, in turn, would likely lead to a reassessment of the Fed's rate path, which could be an escape valve for dollar pressure.

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  102.    Ex-nanny for Pen gets 5-year term | News, Sports, Jobs – Morning Journal

    The former nanny of Pittsburgh Penguins player Chris Kunitz was sentenced Tuesday to five years in federal prison for setting fire to her rental residence and then filing fraudulent insurance claims for the contents.

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  103.    Richmond Hill defendant Monserrate Shirley gets 50 years

    A central figure in the Richmond Hill explosion — which the judge called one of the "biggest cases of conspiracy" in Marion County history — received the maximum sentence under the plea deal for her role in the blast that killed a young couple and leveled dozens of homes in an Indianapolis neighborhood.

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  104.    Anchorage Husband and Wife Convicted of Wire Fraud for Faking Burglary | USAO-AK | Department of Justice

    The evidence established that on the night of January 17, 2016, the Flowers moved several items from their home into a storage unit located at Best Storage on Tudor Road in Anchorage. These items included several big screen television sets, jewelry, clothing, shoes, designer handbags and sunglasses, video games, computers, and other electronics. On January 18-19, the Flowers staged a burglary at their home on Larkspur Circle and claimed in their report to the Anchorage Police that the items they previously put in storage had been stolen in a burglary of their home.

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  105.    Caldwell Man Sentenced for Insurance Fraud

    … Harkins reported damage from irrigation water seeping into his home's basement in June of 2014. His insurance policy, however, did not cover flood damage and the claim was denied.

    About one month later, Harkins filed a new claim for water damage to his basement. He said a washing machine hose had ruptured and caused the damage. An investigative engineer examined the hose and concluded the hose did not rupture, but was intentionally cut. As a result, DOI investigators concluded that Harkins had knowingly provided false information to his insurance company.

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  106.    Man gets prison for arson fire

    A state fire marshal and an investigator for the insurance company determined that the fire was set intentionally. Cox was the last person in the home before the fire was reported.

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  107.    New High-Tech Ways to Catch Burglars [and more]

    You need to read this one.

    Add your comment. Including the article/link number will help.


  108.    Texas Hail Losses Set Record in 2016

    Only Hurricane Ike in 2008, the costliest storm in Texas history, inflicted more damage to homes than this year's hailstorms ….

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  109.    Oklahoma Creates Fracking Guidelines with Goal of Reducing Quake Risk

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  110.    California Attorney General Sues Feds in Offshore Fracking Challenge

    Coastal Commission Acting Executive Director Jack Ainsworth said that ecological damage to the coast poses economic risks that could be worse than bringing an end to fracking.

    That's a fact.

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  111.    Pending U.S. Existing-Home Sales Fall on Higher Mortgage Rates – Bloomberg

    No surprise here at all:

    The drop in contract signings was the first in three months and shows the impact of a surge in borrowing costs that began after the U.S. presidential election. While home-buying activity has been spurred by further labor-market improvement and promising gains in wages, the industry also has been challenged by limited inventory, particularly for lower-priced homes that could attract entry-level buyers. A further increase in mortgage costs risks reducing affordability as gains in property values have been outpacing income growth.

    Landlords may conclude that it will be great for rental rates, as those should rise as fewer people will be able to afford the higher mortgage rates. However, the overall economy will suffer, which will harm tenants' ability to pay those higher rents. Put that together with Trump's bad ideas (so far) for stimulating the economy, and we're looking at recession. What will the Fed do? Will they wake up and stop raising rates but rather apply pressure for fiscal stimulus? Even if the Fed does that, will the Trump administration listen? Even if both the Fed and administration agree, will the legislative branch go along?

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  112.    As home prices rise, house-flippers stage comeback – MarketWatch

    The following is exactly what I was thinking the whole time I was reading this article up to the point of this paragraph:

    Another question mark is the future of long-term interest rates. Since Donald Trump's surprise election victory, mortgage rates have been surging. If the trend continues, it is likely to chill housing markets, making it harder for investors to quickly flip homes for a profit.

    If I were doing flips, I'd have already started planning for holds.

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  113.    The Wrong Kind of UBI

    This article echoes much of what I've been writing for years now.

    The Swiss proposal advocates for a considerably higher and livable 2,500 francs per month — and its proposed text for the constitutional amendment states a basic income should "enable a dignified existence" for the entire population ….

    Thats the proper perspective.

    What the article doesn't mention is automation, which will force the issue, capitalism or not.

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  114.    Jeffrey P. Snider Blog | Economists Canada Problem | Talkmarkets

    This is a worthwhile read if you've been thinking Canada is immune.

    Canada's banking and mortgage system was sufficiently different and better than those in the US that Canada avoided the real estate meltdown of 2007-8. However, Canada's energy sector is not atypical at all (other than that it is even more costly to produce on average in pure dollar terms, as well as ecologically).

    Canada has clamped down a bit on the Chinese-investor-led housing bubble. Also, the OPEC-Russia moves concerning output should rev up Alberta a bit.

    Global Warming and the move to electric vehicles and alternative energy will still force Canada to change (for the better environmentally speaking).

    Add your comment. Including the article/link number will help.


  115.    China to rein in outward investment as domestic growth stalls | Business | The Guardian

    While foreign investment has soared, the amount of money flowing into the country is set to remain broadly flat at £92bn. This means the difference between investments abroad and those coming into China has reached an unprecedented £39bn.

    Xi can't continue allowing that. Rather than democratize, he'll clamp down further and further and further until the People throw off both the CCP and him.

    Add your comment. Including the article/link number will help.


  116.    Illinois Supreme Court Clarifies Sidewalk Snow Removal Law

    When you ask your insurance broker if something is covered, keep in mind that it's often a moving target.

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  117.    China Hits a Fork in the Road

    … I don't see how Xi and his crew will get themselves through this minefield without getting burned. I'm looking for an escape route, but there seem to be none available.

    Well, perhaps Xi takes up the trade war against Trump's plan. How hard a bargain will Trump drive? Xi could spread the propaganda within China that whatever happens is Trump's fault. Would the Chinese People buy it?

    Add your comment. Including the article/link number will help.


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