News Alerts. Sept. 18, 2013. Morning Edition. #RealEstate

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  1. Tiny aPodments causing big controversy in Seattle | Local & Regional | Seattle News, Weather, Sports, Breaking News | KOMO News News Alerts. Sept. 18, 2013. Morning Edition. #RealEstate

    They’re still arguing over this aPodment issue.

    SEATTLE — If the walls on the home at 1715 NW 58th Street could talk, they might tell tales of a different Seattle: one where William Howard Taft was president; where milk cost .32 cents a gallon; and one where houses didn’t have electric light.

    The home was born in that bygone era – in 1909 – but on Monday, met its demise. A bulldozer clawed at its wooden doors and tore away its graffitied facade, splintering the walls – and public opinion.

    “I believe in urban density but this is too much for our small neighborhood,” said Linda Melvin, who lives across the street from the lot. “I draw the line.”

    A developer plans to replace the single-family home with a four-story apartment building, holding 43 micro-units – often referred to as “aPodments,” according to plans filed with the city. The units are smaller (starting around 140 square feet) and less expensive (in the $500 – $1000 range) than a traditional apartment because they share amenities, such as a kitchen.

    Read the source article …–224002631.html

  2. EconoMonitor : Emerging Markets: What Has Changed News Alerts. Sept. 18, 2013. Morning Edition. #RealEstate

    China needs to rein this in.

    Chinese lending data suggest signs of greater activity in the shadow banking sector. Aggregate financing jumped RMB1.57 trln in August and snaps the downtrend that had been in place since the start of Q2. However, new yuan loans rose RMB711 bln (from RMB700 bln in July). The gap between the new yuan loans and the aggregate financing is often taken as a proxy measure of the shadow banking activity. At RMB858 bln, this spread is back to levels not seen since April, but still well below the highs of RMB2.550 trln in March. This is a very volatile series, but the upturn bears watching in the months ahead. Though the economy appears to be stabilizing, we think policymakers will keep USD/CNY broadly sideways in the 6.10-6.15 range.

    Read the source article …

  3. EconoMonitor : Ed Dolan’s Econ Blog : What Does the U-6 “Broad Unemployment Rate” Really Tell Us? News Alerts. Sept. 18, 2013. Morning Edition. #RealEstate

    All together, the Vedder study claims that as many as 48 percent of all college graduates are employed in occupations that require less than a college degree.

    Vedder et al. point out that we can view these data in two ways. On the one hand, they can be seen as a a cyclical phenomenon, in the sense that a weak job market pushes college graduates into occupations that do not make use of their skills. On the other hand, the data can be seen as a symptom of secular overinvestment in education. They suggest that a “college for all” mentality may be running up against diminishing returns, so that the number of graduates (at least in some fields) is growing faster than demand regardless of the state of the business cycle.

    We think Ed Dolan is underestimating the value of a U-7. It would certainly be difficult to drain a U-7, but having the number would encourage more effort to reduce it rather than relying upon systemic unemployment to hold down inflation (on the backs of the poor and now also college grads).

    We think we could have our cake and eat it too. That is, we think we could have very low unemployment and very low or no inflation (and no deflation for that matter).

    Read the source article …

  4. Woodford’s Theories Rooted in Japan Slump Embraced by Bernanke – Bloomberg News Alerts. Sept. 18, 2013. Morning Edition. #RealEstate

    We agree with this:

    … the Fed should adopt a broader goal: returning total economic output — nominal gross domestic product, in economist parlance — back to the trend it would have been on if the recession hadn’t occurred.

    Who is he? He’s Michael Woodford. “‘He is probably one of the best-known, most influential economists that noneconomists are not aware of,’ says Eggertsson, who’s an associate professor at Brown University.”

    Doing what Woodford suggests, however, would not be easy because technically, it would require policy changes beyond the Fed’s purview/mandate. Those changes should be made though.

    We also advocate that the Congress and White House embark upon highly targeted fiscal spending, not what they did earlier during Obama’s administration, which was not sustained enough, not open-ended enough, not focused enough on infrastructure and permanent, full-time, high-skills employment (and training where needed).

    Read the source article …

  5. Sheila Bair: U.S. Banking System Still Fragile – Real Time Economics – WSJ News Alerts. Sept. 18, 2013. Morning Edition. #RealEstate

    Wessel: I’m David Wessel from the Wall Street Journal, I’m joined today by Sheila Bair who’s now a senior advisor to the Pew Charitable Trust where we’re sitting but we’re here because you were the Chairman of the Federal Deposit Insurance Corporation during one of the worst moments in our economic history. I think as we look back on anniversaries one question people have is have we done enough to make us safe, have we done enough to reduce our vulnerability so we don’t have to go through something like this again?

    Bair: No I don’t think we’ve done enough. We have done some things that have been helpful on the margin but I think our system is still somewhat fragile, a lot more needs to be done.

    Wessel: What things do you think we have done and what would be on your to do list?

    Bair: Well, we have got more capital into the banks, not enough, they’re still too highly leveraged but we did get more capital into the banks through the stress-testing process that started during the crisis. We’ve implemented rules for new resolution authorities, the Dodd/Frank gave the government now the tools to have an orderly bankruptcy process for very large financial institutions. There’s more work that needs to be done there but the rules are in place, the powers are there and they’re available for use. Derivatives, I think Gary Gensler the outgoing chairman of the CFTC deserves a lot of credit, he’s really driven through most of the rules to get most of off-exchange derivatives trading, at least the standardized products, onto central clearing eventually central trading. I think that’s a very positive thing. And then the consumer bureau has implemented mortgage-lending standards, which we didn’t have, even just basic mortgage-lending standards So those are all very positive things. But then I can give you the list of things we haven’t done, w hich is probably a lot longer.

    Wessel: Give me a couple. What’s on the top of your list?

    Bair: We need more capital. I mean the capital rules are still too complicated, the banks are still too…if you take out this risk-weighting nonsense, which really basically says, the bank says their assets are not very risky, they can report higher capital requirements, they’re still highly leveraged, about 4 or 5 percent capital to their total risk-weighted assets. The group that I had said it should be at least 8 percent higher, the regulators have gone up to 6, that’s a big improvement, would bring about 90 billion dollars more capital in but it needs to be more. I think securitization reform we really haven’t done anything and I think securitization was a big driver of the bad lending that we saw and then the bad servicing that we saw after that.

    Do you agree with Sheila Bair?

    Read the source article …