News: Real Estate, Risk, Economics. Oct. 18, 2017

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Table of Contents
(Click to sections below.)

1) Kevin Warsh, Very Serious Person – Tim Duy's Fed Watch

2) Suppression of the wealth tax: an historical error | Le blog de Thomas Piketty

3) California wildfires put thousand of homes at risk

4) Why do even small flats have a $500,000 down payment in Hong Kong?

5) The rise and fall of Emmanuel Macron — RT Op-Edge

6) How Labour could lead the global economy out of the 20th century | George Monbiot | Opinion | The Guardian

7) Northern California Wildfires Destroy Hundreds of Homes (PHOTOS)

8) How an Independent Agent Solves a Problem Like Harvey, Irma

9) UK unemployment in danger of exposing lie used to create the numbers – Business Insider

10) Temporary price-level targeting: An alternative framework for monetary policy

11) Senator Bernie Sanders Delivers the Weekly Democratic Address – YouTube

12) BREAKING: Russia Issuing 'CryptoRuble'

13) Russian Regulators Think They Found a Way to Identify, Tax, and License Crypto Miners – Bitcoin News

14) Xi's thoughts included as Party agrees to amend its constitution | Shanghai Daily

15) Developers Built Homes Inside Houston's Reservoirs. But No One Warned Buyers.

16) After Hurricanes, Focus Turns to Assessing the Effectiveness of Building Code Adoption

17) Prevalent, Discredited Building Technique Raised Mexico's Quake Deaths: Engineers

18) All charges bound to court for 2015 Ridgway fire | News | bradfordera[.}com

19) Electricity required for single bitcoin trade could power a house for a month – Business Insider

20) [Progressives Beware] The IMF Gives A Cautious Welcome To Universal Basic Income

21) Northern California wildfires: A region reduced to ashes

22) Common Reasons for FEMA Denial of Funds After Disasters

23) California Wildfires Threaten Significant Losses for P/C Insurers, Moody's Says

24) Investors Head to Houston to Buy From Panicked Homeowners – Bloomberg

25) California Fires Leave Many Homeless Where Housing Was Already Scarce – The New York Times

26) Washington house fire kills toddler, infant and 2 adults – seattlepi[.}com

27) NASA satellite spots cause of unprecedented spike in atmospheric CO2

28) Scientists Capture Carbon Dioxide and Inject It Into Rocks for Permanent Storage

29) WPA2 security flaw puts almost every Wi-Fi device at risk of hijack, eavesdropping | ZDNet

30) NAFTA Negotiations: Trump Must Preserve This Good Deal | National Review

31) Trump: I'm looking 'very strongly' at reforming welfare system – POLITICO

32) Climate Change Has Doubled Area Hit By Forest Fires in US (Part 2/2) – YouTube

33) Internal investment, not trade deals, is the key to weathering Brexit | Prospect Magazine

34) California wildfires roundup: Latest details, map | The Sacramento Bee

35) Forget BRRRR: Introducing the BARRRR Strategy for Investors

36) Airbnb is teaming up to build a home-sharing complex in Florida

37) Supply & Demand in Sync for Multifamily

38) Residents Begin Filing Claims for West Virginia Chemical Spill

39) Homeowner and her boyfriend indicted for arson, insurance fraud | Crime | timesdaily[.}com

  1.    Kevin Warsh, Very Serious Person – Tim Duy's Fed Watch

    This is really good stuff from Tim Duy. For those not familiar, each time he writes "Serious," he's being sarcastic.

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  2.    Suppression of the wealth tax: an historical error | Le blog de Thomas Piketty

    Thomas Piketty does his usual solid job of taking down neoliberal dogma and ends with this:

    The political strategy which consists in transforming the wealth tax into a property tax (impôt sur la fortune immobilière), to avoid a complete suppression of the wealth tax, quite frankly leaves me speechless. There is no logical reason to levy a higher tax on a person who invests their fortune in a house or a property rather than in a financial portfolio, a yacht or any other type of good. We can only hope that elected members remember that they were not elected to be part of this kind of farce.

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  3.    California wildfires put thousand of homes at risk

    Solid reporting by Diana Olick:

    California wildfires put thousand of homes at risk from CNBC.

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  4.    Why do even small flats have a $500,000 down payment in Hong Kong?

    Hong Kong's sky-high housing prices are a result of government policy with supply having dropped up to 65 percent from the long-term average, says Peter Churchouse of the Churchouse Letter.

    Why do even small flats have a $500,000 down payment in Hong Kong? from CNBC.

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  5.    The rise and fall of Emmanuel Macron — RT Op-Edge

    It's such a crying shame that something so simple isn't allowed to be taught to the regular voters until they get it and put a complete end to neoliberal economics.

    Steve Keen has been as a voice crying in the wilderness, but hopefully that will end.

    Cutting wages will therefore also reduce GDP by almost as much, and possibly even more (as firms respond to a fall in household demand by investing less). That, in turn, will reduce the demand for labor—and not increase it as microeconomic theory argues. As a result, French workers could be put through the same pain that UK workers have experienced under Margaret Thatcher and Tony Blair, only to find that they face just as much unemployment as before.

    The desire to reduce state debt by lowering government spending falls into a similar trap, which is that an attempt by anyone to save money through less spending works for them only by shrinking the incomes of others.

    The logic is simple.

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  6.    How Labour could lead the global economy out of the 20th century | George Monbiot | Opinion | The Guardian

    The following is exactly what I've been writing for many years:

    In the Brazilian city of Porto Alegre, the infrastructure budget is allocated by the people: around 50,000 citizens typically participate. The results — better water, sanitation, health, schools and nurseries — have been so spectacular that large numbers of people now lobby the city council to raise their taxes. When you control the budget, you can see the point of public investment.

    In countries such as the UK, we could not only adopt this model, but extend it beyond the local infrastructure budget to other forms of local and even national spending. The principle of subsidiarity — devolving powers to the smallest political unit that can reasonably discharge them — makes such wider democratic control more feasible.

    I've been taking the whole thing much further than does George Monbiot, but I'm glad he's heading in the right general direction relative to neoliberalism.

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  7.    Northern California Wildfires Destroy Hundreds of Homes (PHOTOS)

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  8.    How an Independent Agent Solves a Problem Like Harvey, Irma

    Ever considered what it's like from our side? This is a pretty good overview. Every broker, agency, carrier, and claims adjuster is different. The rules and regulations vary according to the state. Policies even with the same carrier vary widely. Case law is constantly changing, as are policy forms. Nobody in insurance knows it all. No lawyer specializing in insurance knows it all. We have to have high expectations while remaining realistic. That's probably the hardest part: remaining realistic, reasonable.

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  9.    UK unemployment in danger of exposing lie used to create the numbers – Business Insider

    This is not the whole story, but it's certainly a large chunck of it. The very nature of work is changing, and workers have had low-inflation expectations relative to the past. Employers know it and use it and other things to "justify" low wage increases.

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  10.    Temporary price-level targeting: An alternative framework for monetary policy

    Nothing even remotely radical here. Frankly, price-level changes are price inflation/deflation by another name. The idea of ramping up (allowing more inflation after a crash) and then down is exactly Keynesian. I think Ben made a short story long.

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  11.    Senator Bernie Sanders Delivers the Weekly Democratic Address – YouTube

    Okay, so I've included this because I'm for landlords who are just starting out and often still need what the Trump plan cuts. I'm for property managers and maintenance staff and tenants who need the support that will be cut if the cuts go through.

    I know the argument that Laffer puts forth, but I also know it's a bad argument. His curve doesn't work. His Laffer curve crushed the economy of Kansas so much that even extreme deficit-hawks help to roll back the Laffer changes.

    Does the entire US need to go through the same thing? That would be really, really bad.

    "President Trump and his Republican colleagues are now pushing the most destructive and unfair budget and tax proposal in the modern history of our country. A budget that would do incalculable harm to tens of millions of working families, to our children, to the sick, to the elderly, and to the poor," said U.S. Senate Budget Committee Ranking Member Bernie Sanders (I-VT). "At a time when the middle-class is shrinking, and over 40 million Americans are living in poverty, we need a budget that reflects the needs of working families of the middle-class, and not just the wealthiest people in our country, nor the largest campaign contributors. Our job now is to stand up, fight back, and to defeat this horrendous budget." -Senator Bernie Sanders (I-VT).

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  12.    BREAKING: Russia Issuing 'CryptoRuble'

    This raises many more questions than it answers. Therefore, I will withhold commentary until details come out about taxes.

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  13.    Russian Regulators Think They Found a Way to Identify, Tax, and License Crypto Miners – Bitcoin News

    What is the point for Russia to allow such alternatives to the Ruble? As for this article, miners can certainly afford solar panels. Then what? If everything is regulated and taxed, then the whole point of cryptocurrencies on the level of Bitcoin is completely defeated. I do not see the point. Bitcoin was of, by, and for anarchists and primarily criminal ones at that. What's going to change; and if it does, then why have, or allow, Bitcoin or any private thing like it? It makes no sense. I'm not talking about distributed ledgers or block-chain technology, per se, but private cryptocurrencies.

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  14.    Xi's thoughts included as Party agrees to amend its constitution | Shanghai Daily

    …Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, the important thought of Three Represents and the Scientific Outlook on Development, and … the essence of President Xi Jinping's series of important remarks and new governance concepts, thoughts and strategies….

    I fully recognize the complete sovereign independence of democratic Taiwan and denounce the One-China Policy of all US administrations that adopted or accepted it.

    Mainland China is governed by a one-party dictatorship with one person, Xi, as dictator over that party. The "opening" of mainland China to world trade was sold as the springboard to a democratic mainland. Xi has zero intention of serving subject to the consent of a fully informed, universal-suffrage, Chinese electorate.

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  15.    Developers Built Homes Inside Houston's Reservoirs. But No One Warned Buyers.

    Wow:

    Hebert, the county judge, said he's not even sure those small notices on the plats are legal. Anything that could cause property values to drop — and a disclosure that a house is inside a reservoir would fit that category — is a possible governmental "taking" of private property without compensating landowners.

    That's a huge deal if correct.

    After reading the article, I'm having difficulty wrapping my head around that people didn't realize what the huge dams were for. Nevertheless, I think the lack of non-obscure disclosures is shocking and appalling.

    Maybe the Army Corps should have more power. It sounds like too many people could too easily ignore them when the Corps would say absolutely correct things that if heeded would have spared all those owners and everyone associated.

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  16.    After Hurricanes, Focus Turns to Assessing the Effectiveness of Building Code Adoption

    Florida puts Texas to shame on Building Code Effectiveness Grading Schedule (BCEGS).

    I hope it is one of those moments that crystallizes for consumers the need to be more involved and to ask for, to agitate for, to advocate for strong, well-enforced building codes. It's a really important topic for community continuity," Rochman said.

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  17.    Prevalent, Discredited Building Technique Raised Mexico's Quake Deaths: Engineers

    …construction method called flat slab — in which floors are supported only by concrete columns….

    Even though that's a terrible idea where the earthquake occurred, there are still those who don't want it banned and don't want mandatory retrofitting.

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  18.    All charges bound to court for 2015 Ridgway fire | News | bradfordera.com

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  19.    Electricity required for single bitcoin trade could power a house for a month – Business Insider

    Bitcoin is an obscene energy hog right when we are in need of reducing CO2 in the atmosphere. I consider it highly immoral.

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  20.    [Progressives Beware] The IMF Gives A Cautious Welcome To Universal Basic Income

    The B in UBI is a libertarian-capitalist device, not progressive. UBI stands for Universal Basic Income. Progressives should not fall for it. From the beginning, progressives have been for ULI. ULI stands for Universal Living Income. The difference between Basic and Living is that Basic is survival while Living is, well, living. Living there has connotations of a truly good quality of life from an economic standpoint. Basic is designed to leave the elite capitalists in place at the top as the world's plutocrats. Living is designed to free the people from that. If you're not beholden to those elitists, then democracy can thrive instead of the dictatorship of the plutocracy.

    Basic replaces welfare and other similar benefits with cash. It does not increase anything. It doesn't increase healthcare or payments for tuitions or subsidies for rent or utilities, etc. Living pays for all those things while leaving truly discretionary funds to pay for vacations, entertainment, dining out, and the like. It really doesn't take that much to allow a person to have some reasonable discretionary money. Living does not eliminate single-payer healthcare (if we get there, which I think we will). It is in addition to it. It could pay for healthcare insurance before we get there. Are you seeing the huge difference between Basic and Living?

    You've heard of basic wages and minimum wages versus living wages. It's the same principle here with a guaranteed income.

    By the way, a guaranteed universal living income doesn't prevent anyone from pursuing more in the mixed economy. In fact, it's been shown that having money frees one up to do what's necessary to obtain more of it. It's often true that a second generation, the generation after the first one that made the "family" well off, doesn't strive for more to the same degree the first did, but so what? It's certainly not always the case. Plus, automation is changing everything very rapidly. There simply won't be any option.

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  21.    Northern California wildfires: A region reduced to ashes

    Speechless

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  22.    Common Reasons for FEMA Denial of Funds After Disasters

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  23.    California Wildfires Threaten Significant Losses for P/C Insurers, Moody's Says

    … additional living expenses due to the massive ongoing evacuations, and some commercial property insurers are likely to pay business interruption claims.

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  24.    Investors Head to Houston to Buy From Panicked Homeowners – Bloomberg

    Okay, but investors better do the math. This article mentions many of the risks. As far as I'm concerned, investors better plan on self-insuring. They better have deep pockets, liquid pockets (pun intended).

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  25.    California Fires Leave Many Homeless Where Housing Was Already Scarce – The New York Times

    There are people who not only lost their houses but also their businesses. Hopefully, they had adequate coverage for both. Even with coverage, it's still tragic.

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  26.    Washington house fire kills toddler, infant and 2 adults – seattlepi.com

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  27.    NASA satellite spots cause of unprecedented spike in atmospheric CO2

    It's a vicious cycle. We reap what we sow and then some. Some people term such things poetic justice. Unfortunately, those against continuing the carbon-fuel burning reap what those who don't care sow. Fortunately, the green-energy revolution is also very real.

    The race is on. Which side will win out? Will it be green energy? If so, will it be in time? I'm optimistic but do not want to rest on the issue.

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  28.    Scientists Capture Carbon Dioxide and Inject It Into Rocks for Permanent Storage

    Last year, scientists at the plant discovered that carbon dioxide emissions could be put into the ground and turn into rocks quickly, according to Phys.org. Now they're capturing emissions from the sky to follow this process. The pilot plant is the start of what project organizers hope to be a solution that can someday be used worldwide.

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  29.    WPA2 security flaw puts almost every Wi-Fi device at risk of hijack, eavesdropping | ZDNet

    We're interested in cyber security along with other risk-management issues.

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  30.    NAFTA Negotiations: Trump Must Preserve This Good Deal | National Review

    I think we know President Trump's style by now. He says he wants to renegotiate. The other party or parties object. Trump and/or his team whips out a chainsaw. The other party or parties suggest a scalpel.

    As far as NAFTA goes, this article doesn't mention environmentalism or labor rights or worker safety, etc. That's no surprise, as the National Review doesn't have those things high on its list of priorities. Regardless, the Trump administration isn't going to work for them either. Nevertheless, they bear raising here. I care.

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  31.    Trump: I'm looking 'very strongly' at reforming welfare system – POLITICO

    Trump's proposed fiscal 2018 budget called for a massive reduction in funding for social safety nets, such as food stamps, Social Security disability insurance benefits, and the Temporary Assistance for Needy Families program.

    President Trump has a tax-cut plan that he wrongly says will light the economy on fire and create tons of jobs, etc. If we were to cut benefits to the poorest of the poor, which is what he's suggesting, and then do his tax cuts, which would work but will only increase the national debt in the aggregate, what good have we done the overall economy? We will further enriched the rich at the expense of those who can least afford it.

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  32.    Climate Change Has Doubled Area Hit By Forest Fires in US (Part 2/2) – YouTube

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  33.    Internal investment, not trade deals, is the key to weathering Brexit | Prospect Magazine

    Ann Pettifor:

    The "negative multiplier" (the contractionary effect of reductions in government expenditure) which already serves—as the IMF has shown—to reduce the likely level of GDP, will be made worse when Brexit chaos is factored in.

    Brexit for democratic reasons is one thing, but UKIP was never about leaving for greater democracy or greater UK or English sovereignty. It was always about increasing capitalist anarchy, and capitalist anarchy is always and everywhere a total disaster for any national or supranational economy as a whole. It only benefits the superrich and then, only in an illusory manner (at the expense of the environment and social harmony and so many other things even the superrich can't really do without in the longer run). They're dooming their offspring if it even takes that long to catch up with them.

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  34.    California wildfires roundup: Latest details, map | The Sacramento Bee

    Cal Fire reports Tuesday morning that in the past week, more than 245,000 acres have burned across California. More than 11,000 firefighters continue making progress on 12 large wildfires burning in the state, said Lynne Tolmachoff, Cal Fire spokeswoman, in a release.

    The Northern California wildfires have killed at least 41 people and destroyed 6,700 homes and businesses and wiped out entire neighborhoods in and around Santa Rosa. State fire Deputy Directory Daniel Berlant said collectively this is the deadliest series of simultaneous fires in the state in recorded history.

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  35.    Forget BRRRR: Introducing the BARRRR Strategy for Investors

    Okay, so I'm not a CPA, but if this isn't being overly creative (meaning if the IRS won't slap you down with a penalty to boot), then it's a great article. Would I just do it because Brandon Hall said to go for it? I might. Why? He's a CPA with experience in this exact issue. Might I get a second opinion just to be more careful and have something to show the IRS and possibly tax court as to why I did what I did? Yep. Would I go read the actual IRS documentation about it? Now THAT sounds just like me.

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  36.    Airbnb is teaming up to build a home-sharing complex in Florida

    I'd need more info to truly understand how many layers of subleases are involved for a given complex. Are there sub-sub tenants? Does the article say it and I didn't get it?

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  37.    Supply & Demand in Sync for Multifamily

    I don't rah-rah rent-rate increases unless within a balanced context. That's because I'm every bit as concerned with the health of the entire economy as I am just for the commercial-multifamily-rental market and individual landlords or firms.

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  38.    Residents Begin Filing Claims for West Virginia Chemical Spill

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  39.    Homeowner and her boyfriend indicted for arson, insurance fraud | Crime | timesdaily.com

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