Linking ≠ endorsement.
⇧ SYRIZA’s Thessaloniki Programme vs. Euro-Troika Austerity – YouTube
This is an excellent interview on the subject.
What I’m left wondering is the degree to which polling results in Greece are accurate. Polling before the greferendum suggested a “tight” election, which turned out to be very wrong, as the No vote won with 61%. So, when the media is claiming that Alexis Tsipras is even more popular as of July 22, 2015, it makes me wonder whether those poll results could be off by 10% or more and whether Tsipras is not only not still popular but actually fairly unpopular.
Leading member of the Left Platform of SYRIZA, Dr. Stathis Kouvelakis defends the original mandate for national reconstruction given to SYRIZA by the people by challenging the SYRIZA leadership, hours before the second austerity bill expected to pass in Parliament on Wednesday (July 22, 2015).
Embedding disabled by request. https://www.youtube.com/watch?v=F1Ba0bPtvWM
⇧ Spending millions of tax dollars to clean up private properties: – ABC 33/40 – Birmingham News, Weather, Sports
“If the properties are more than five years tax delinquent, or at least five years tax delinquent, we can take those properties and they will become property of the city and we can take them through the land banking authority and either give them to the adjacent property owner or put large chunks of them together for redevelopment,” ….
⇧ Nothing Wrong With ‘Beautifying Vacant Properties,’ Alleged Squatter Says – Beverly – DNAinfo.com Chicago
This is a good example of why a proper title search and title insurance covering the buyer are so important.
⇧ Don’t Be So Sure About a Rate Rise-Dividend.com
“…economic theory and history do not suggest the secular low in inflation, or that its alter ego, Treasury bond yields, is at hand,” Dr. Hunt [Lacy Hunt, Exec. VP, Hoisington Investment Management, economist] concludes. “The excessive debt burden, slow money growth, declining money velocity, the Wicksell effect and the high real rate of interest indicate that the fundamental elements are exerting downward, rather than upward, pressure on inflation.”
I agree, which won’t surprise our consistent readers.
⇧ Oil and gas crunch pushes Russia closer to fiscal crisis – Telegraph
Russia bet its future on oil, gas and the commodity boom, letting its manufacturing base atrophy in the glory days of the strong rouble.
It has now been left high and dry by the commodity slump, a textbook case of the Resource Curse.
So, how much has Russia been doing to boost its manufacturing and domestically developed technology?
Do they understand that the next time gold prices rise, they should dump their holdings?
They also need to do everything they can to trade internationally in Rubles. They should create Rubles and use them to become debt free regardless of inflation.
Russia needs full monetary and banking reforms. They made a big mistake modeling so much of their economy on Anglo-Saxon so-called “classical” economics.
⇧ Zillow’s Housing Roadmap: How Detroit’s Urban Revitalization is Re-Igniting a Region – YouTube
… Zillow hosted a panel discussion in Detroit as a part of Zillow’s Housing Roadmap to 2016, a series of local events and conversations around today’s most important housing issues.
Panel One: How Detroit’s Urban Revitalization is Re-Igniting a Region
– Moderator: Stan Humphries, Chief Economist, Zillow
– Erica Ward Gerson, Chair, Detroit Land Bank Authority
– James Arthur Jemison, Director of Housing & Revitalization for the City of Detroit
– Tosha Tabron, Vice President, Relationship Manager – Global Philanthropy, JPMorgan Chase
⇧ Officials Say Washington Wildfire Was Human-Caused
Officials say a wildfire that has burned one home and torched nearly 6 square miles in southeastern Washington was likely human-caused.
⇧ Oklahoma Town OKs Rules Restricting Oil, Gas Drilling in City
“…our No. 1 priority at City Hall is to protect our citizens,” Dorman said earlier this month.
⇧ Homeowner charged with second-degree murder, arson, insurance fraud – News – The Times-Tribune
Second-degree murder, arson and fraud charges were pending Wednesday night for the owner of a home that burned Saturday, a fire that investigators say killed his brother.
David Cay Johnston:
…beware of the new rise in housing prices. It augurs not so much a general economic recovery as more evidence of how government policy helps the few at the expense of the many.
Yes; and in the long run, it’s also not good for landlords in general, who need a strong and balanced economy to really prosper in large numbers.
⇧ 4 Unusual Ways Millennials Are Different From Boomers
This is actually a pretty interesting read.
I think their attitudes will change as they mature, but still.
There is a glimmer of hope that the ‘counter-narrative’ of the eurozone crisis so brutally dismissed and ridiculed by the zone’s policymaking elite is beginning to find resonance among many anti-austerity citizens of Europe. First, Greek indebtedness and that in other eurozone peripheral countries had similar underlying causes: a malfunctioning monetary union. Second, the ‘rescue’ of Greece in 2010 resulted in the rescue of European banks and prevented ‘contagion’ in the eurozone. Third, it was the implementation of savage austerity rather than the non-implementation of the ‘troika’ adjustment programme that produced the collapse of the Greek economy. Fourth, the Greek debt was unsustainable in 2010 and 2012 and it is even more unsustainable in 2015.
Whether the crushing of Syriza in Greece for daring to challenge the dominant narrative of the crisis would help or hinder the emergence of a movement for the long awaited political reform of Europe remains to be seen. The only ‘contradiction’ that remains in the eurozone is the utopian expectation that a monetary union will work under German hegemony without political union. ‘Muddling-through’ is no substitute for rational policymaking in the second largest economy in the world.
⇧ EconoSpeak: Is China’s Problems Responsible For Recent Market Slides?
Reading this, I can’t understand how Barkley Rosser can remain so unsure that China is imploding quite a bit.
⇧ Grand Central: Economists No Longer So Negative on Negative Rates – Real Time Economics – WSJ
…some European central banks started to set policy rates marginally below zero, and there was no widespread flight to cash or massive disruption of the financial system, probably because it’s quite costly and risky to hold cash in large amounts.
I advocated negative rates before they were proven. It’s easier to be right about such clear cases of mechanics. It’s knowing in advance the consistency of politicians that’s harder.
⇧ Can I Make an Offer Sight Unseen? [#AskBP 070] – YouTube
In today’s hot market, it can be difficult to view a property before it goes under contract. On this episode of the #AskBP Podcast, Mindy Jensen discusses waiting to view a property, and what an inspection contingency is really for.
Well, I respectfully disagree. It will depend upon the market. If it is a seller’s market and very difficult to even get an offer in, in time after visiting the property, then making a contingent offer is not a bad idea and not necessarily bad for the seller because you, as potential buyer, will likely have to agree to forfeit your earnest-money deposit if the property doesn’t pass your inspection. Of course, your offer can have provisions concerning which inspection failures will and won’t trigger such a forfeiture. Something typical might be where your inspection reveals material defects (over a certain dollar amount to repair) the seller did not disclose before you made the offer.
Remember, however, that in a seller’s market, sellers will most often not want to see much in the way of non-standard offers and won’t want the hassle of lots of traffic through the property just for the price of a typical earnest-money deposit.
Make that deposit big enough, and you might get around that though.
Regardless, I don’t think such an arrangement is unethical, especially considering that the seller will likely have a real estate agent recommending to go or not go with your contingent offer.
⇧ The Housing Market Still Isn’t Rational – The New York Times
Robert J. Shiller, Professor of Economics, Yale:
There is a way for smart money to profit from an understanding of high prices. It is to build new houses and sell them before prices fall. This is a time-consuming process but it is what we are starting to see now, as housing starts and permits data show.
In San Francisco, for example, we found that while the median expectation for annual home price increases over the next 10 years was only 5 percent, a quarter of the respondents said they thought prices would increase each year by 10 percent or more. That would mean a net 150 percent increase in a decade. These people are apparently not thinking about the supply response that so big a price increase would generate. People like this could bid prices in some places so high that eventually the local market will collapse. Yet the smart money can’t find a profitable way to correct such errors today.
⇧ This MBA chart shows the real rise of home prices | HousingWire
The national index of house prices is now only 1.8% below the peak level of May 2007.
⇧ Emerging market currencies crash on Fed fears and China slump – Telegraph
The Caixin/Markit manufacturing survey for China fell to a 15-month low of 48.2 in July, with a sharp drop in new export orders. Danske Bank said the slide “pours cold water” on hopes of a quick recovery from the slump seen earlier this year.
…it is brutal for those countries that have been feeding on the Chinese construction boom.
Growth in emerging markets — excluding China — has fallen to 0.1pc. These countries are on the brink of recession. They are now being hit on two fronts at once since the Fed shows no signs so far of backing away from a rate rise in September, probably the first of many.
Well, I agree with that excerpt about China but not the US.
⇧ How I Raised $5M to Buy an Apartment — While on the Beach
This fellow, Brian Burke, is selling hard work and no shortcuts [unless you’re born networked]. So, what’s to complain about? He’s lived it. That’s the best form of advice.
⇧ Carbon Monoxide Poisoning an Odorless Killer
A quadruple tragedy that claimed the lives of four area young people elicited shock and sympathy from local officials, as well as calls for increased vigilance to prevent deadly carbon monoxide poisonings.
Read the article to learn more about steps to take to avoid this from happening.
Don’t forget not to run a carbon-fueled vehicle in a closed garage either. Open the garage door first.
⇧ Residential Fires Killed 2500 People Between 2011-2013
Wow, read that headline again.
Fire pattern, egress and escape issues were the top three factors contributing to house fire fatalities.
The three main causes of residential fires were unintentional acts, playing with a heat source and smoking.
⇧ The M.I.T. Gang – The New York Times
…M.I.T.-style economics, with its pragmatic openness to evidence, has been very right indeed.
The Chinese equity market has declined sharply over the past month, with the Shanghai Composite Index off 34.9% from its June 12 high to a July 9 low.1 This decline is on par with the 1987 US stock market crash, but has yet to reach the depths of the 2007 sell-off in China or the US financial crisis of 2007 and 2008. The steep drop has touched off fears that the Chinese economy will suffer an adverse wealth effect and a material slowdown in growth — and we’re already seeing signs of such a slowdown….
⇧ The Eurozone’s German Problem by Philippe Legrain – Project Syndicate
Wow! This is the toughest talking post I’ve seen in a long time.
Germany’s external surplus clearly falls afoul of eurozone rules on dangerous imbalances. But, by leaning on the European Commission, Merkel’s government has obtained a free pass. This makes a mockery of its claim to champion the eurozone as a rules-based club. In fact, Germany breaks rules with impunity, changes them to suit its needs, or even invents them at will.
Definitely read the whole thing.
⇧ City of Savannah-owned residential properties a hard sell, hurting redevelopment | savannahnow.com
The 37 “remnant” properties are victims of a change to eminent domain laws in 2006 that severely limited the city’s ability to acquire blighted, vacant properties and combine them with similar adjoining lots and develop housing as a way to improve neighborhoods, said Housing Department Director Martin Fretty.
“That was really a backbreaker when they did that,” Fretty said.
⇧ Greece crisis: ‘Grexit’ tests Germany’s power duo Merkel and Schaeuble – Independent.ie
This is inside-politics.
This is the age of the Mega Fire. With more people living on Earth than ever before, we are seeing catastrophic blazes, harrowing droughts, and devastating deforestation. Are these the products of man or are they all part of the Earth’s natural rhythm?
There is one distressing indication of where we are headed. Dust and soot reduces the reflectivity of ice sheets causing them to absorb more heat and melt faster.
⇧ Commodities supercycle’s end is nigh – YouTube
Commodity prices are at multiyear lows as China slows and the dollar climbs. The FT’s Michael Mackenzie and Neil Hume discuss the factors that have rung the death knell for the so-called commodities supercycle.
Lower gas prices will be bad for fracking but good for construction and aspects of the environment concerning fracking versus less environmentally damaging production. China will slow burning though, right?
The points made in this article are the typical things a decent insurance agent or broker will tell the insured about when to file a claim.
We pay many insurance premiums throughout our lives for a multitude of different risks. But should you always file an insurance claim?
Understand that the decision to report a claim to the insurer (carrier) is the insured’s and not the agent’s or broker’s. It is improper for an insured to think he or she may place the decision-making responsibility on the agent or broker. The agent or broker may properly explain the thought processes insureds typically use, which are outlined in the linked article, but stop short of making the decision.
⇧ How Much Do Oil Prices Affect Inflation?
Neely noted that the correlation between the daily changes in breakeven inflation and West Texas Intermediate spot oil prices was positive and substantial over the period 2004-15. A 50 percent reduction in oil prices would reduce expected inflation by 0.27 percentage points per year over 10 years.
However, inflation is difficult to predict, and Neely noted that studies have shown that oil prices seem to pass very little through to inflation. He wrote, “For example, Chen’s (2009) estimates with quarterly data predict that a 50 percent decrease in oil prices would reduce the overall price level by less than 0.19 percent, which is far less than the change implied by financial markets.”
⇧ Blackstone Buys $2.7 Billion of Nordic Properties From Funds – Bloomberg Business
Blackstone uses an all-cash deal to cash in on the weak krone.
⇧ Varoufakis reveals cloak and dagger ‘Plan B’ for Greece, awaits treason charges – Telegraph
Well, I’m certainly glad to hear that Yanis Varoufakis had actually done what so many others and I had suggested: get all set to push the button from the euro to a new currency (in this case, returning to the drachma).
Tsipras should have pushed the button after the greferendum and once the Germans and others had made clear that the terms would be harsher rather than reasonable (substantial loan-principal reductions).
⇧ Woman Injured When Vehicle Crashes Into Her Apartment – CBS Baltimore
HOWARD COUNTY, Md. (WJZ)—Police in Howard County were called to the scene after a vehicle crashes into an apartment building, injuring one woman inside.
⇧ Southampton Village blaze that destroyed $9 million mansion under investigation, officials say | Newsday
Fire officials said Sunday they are investigating a Southampton Village fire that destroyed the $9 million home of a real estate mogul whose clients include Polo Ralph Lauren, Donna Karan and Dolce & Gabbana.
Lawrence Friedland owns Manhattan-based Friedland Properties, which boasts on its website that it’s the largest landlord on the pricey “Gold Coast of Madison Avenue” shopping area.
⇧ Buying real estate at auction can be tricky, but profitable
Want to retire as a real estate mogul?
You might start at Philadelphia’s sheriff sales, where you can buy discounted properties at auction. Don’t bring cash, and watch out for the real estate developers who try to intimidate the competition.
In an effort to clean up a Wild West atmosphere at the sales, Sheriff Jewell Williams has built an online property database of parcels coming to auction and installed a strong police presence the day of bidding.
⇧ Rural real estate killed by Congress
Imagine you bought a wonderful river front property. You’ve loved the place, but priorities have changed and now you either want or need to sell. You accept an offer for $220,000, but the appraisal comes in at $193,000. How could this happen: the house right next to you, almost identical to yours, sold two years ago for $257,000 and the market has improved? The answer is Congress.
⇧ Greece, the Sacrificial Lamb – The New York Times
Joseph E. Stiglitz:
…the I.M.F. cannot participate in a program in which debt levels are unsustainable, and Greece’s debts are unsustainable.
For now, the Greek government has capitulated. Perhaps, as the lost half decade becomes the lost decade, as the politics get uglier, as the evidence mounts that these policies have failed, the troika will come to its senses. Greece needs debt restructuring, better structural reforms and more reasonable primary budget surplus targets. More likely than not, though, the troika will do what it has done for the last five years: Blame the victim.
⇧ This Dutch city is giving basic income a try – Business Insider
“In our scientific experiment,” she says, “we will approach people with less or no rules, to see whether they still make an effort.”
Researchers from the city council and University of Utrecht will separate at least 250 welfare recipients into five groups: a control group operating under the current laws, three groups with fewer rules, and an unconditional income group that receives money no matter what.
Some will start businesses. Some of those will thrive and hire people.
Sooner or later, technology will force the issue. The sooner, the better.
⇧ Hyperinflation in Zimbabwe – Wikipedia, the free encyclopedia
A solution effectively adopted by Zimbabwe is to adopt some foreign currency as official. To facilitate commerce, it is less important which currency is adopted than that the government standardise on a single currency. The US dollar, the euro, and the South African rand were candidates; the US dollar had the most credibility and was the most widely traded within Zimbabwe. Zimbabwe could have joined the nearby nations of Lesotho, Namibia, South Africa, and Swaziland, which constitute the Common Monetary Area, or “Rand Zone” by formally deciding to use the rand to promote trade and stability.
In 2009, the government abandoned printing Zimbabwean dollars at all. This implicitly solved the chronic problem of lack of confidence in the Zimbabwean dollar, and compelled people to use the foreign currency of their choice. From then through 2014, Zimbabwe still used a combination of foreign currencies, mostly US dollars.
In 2014, the Reserve Bank of Zimbabwe unveiled “centavo” coins in denominations of US$0.01 through US$0.50. The Bank said that 80% of Zimbabweans use the U.S. dollar, and said the local lack of coins induces retailers to round prices up to the next higher dollar. The coins extend the use of the dollar as a de facto currency, and indeed the Bank repeated assurances that it does not intend to bring back a national currency.
Walter Kurtz hits all the important points.
The ability to bring capacity back online quickly is the reason we saw US rig count unexpectedly increase last week. This creates a natural near-term cap on crude prices, above which production can rise quickly.
⇧ The Failure of Politics: Merkel’s Euro Debacle? – The Globalist
With more political courage on her part, she could have opted for a real solution in 2010. Such a solution required fixing the eurozone through a broad debt restructuring and mechanisms for more economic integration, which implies permanent transfers.
Of course, both of these components are highly unpopular among the German public — they were so then and are so today. Thus, she chose the “extend and pretend” option….
Now it is time for Merkel to face the unpleasant truth. Her aiming for a pain-free solution has failed. …
Whenever you make your choice, make sure that your choice is realistic. It is nice to dream about excellent food and good service. But if you cannot afford it, make the compromise upfront to avoid ending up where you don’t want to be.
⇧ China losing control as stocks crash despite emergency measures – Telegraph
The long-standing assumption that the Chinese authorities know what they are doing has been shattered.
… The combined effects of a bursting property bubble, an equity crash and a wave of debt restructuring at the same time have reached critical mass. “Negative forces on growth are strong and self-reinforcing,” he [“Ray Dalio, a long-time China bull at Bridgewater”] said.
I’ve been saying for a long time now that the Chinese leadership doesn’t know what it’s doing.
Mao didn’t know what he was doing. He was a disaster, and things did need to be reformed. However, Deng Xiaoping created a huge mess rather than undertaking intelligent reforms.
Intelligent reforms would have entailed grassroots, full democratization rather than a very poorly executed hybridization of socialism and capitalism.
What a shame.
⇧ Damage to Homes May Lead to Required Soil Tests in South Dakota
Rapid City, S.D., officials are considering requiring homebuilders to test soil conditions at building sites after homeowners complained of severe damage caused by expansive soils.
⇧ Fiat Chrysler Recall Highlights Cyber Risks of Connected Cars, Telematics
The risks of increasing connectivity to physical devices extend far beyond cars and into hospitals and chemical plants and factories, they said.
“It’s a huge problem, and it’s an architectural problem with this Internet-of-Things concept,” said Nicholas Weaver, a security researcher at the nonprofit International Computer Science Institute in Berkeley….
Be aware that landlords and management firms, etc., open themselves up to claims and suits by adopting insecure wireless and wired computer systems. Be careful.
⇧ Cameron vows to expose ‘foreign black money’ in UK property market | Business Standard News
Alarmed by the number of houses being bought by foreigners in the United Kingdom with ‘plundered or laundered cash,’ Britain’s Prime Minister David Cameron has vowed to expose the use of ‘anonymous shell companies’ to buy properties.
This issue has been known about for many years, decades in fact.
⇧ Detroit area housing market among nation’s hottest
…while sales are up, the number of new homes being listed is barely budging, creating a big jump in prices. Real estate agents says it’s common now to see multiple offers on properties, often going over the asking price.
⇧ Wary Chinese investors are ditching stocks for real estate – Quartz
Out of the frying pan, into the fire:
The Chinese government’s determined efforts to recreate a bull market in stocks—perhaps we should call it a mechanical bull?—are getting pretty bumpy, as the Shanghai Composite’s 8.5% drop today attests. If Beijing is hoping for ordinary investors to pile back in to the market, the cause might already be lost. Signs are emerging suggest that investors are turning their attention back to another asset class: real estate.
With the new policy, which will go into effect in late August, the city will contact nuisance home owners about the problem. Then, the property owner can either clean up the property or schedule a hearing with the city to discuss the problem. If the city does not hear from the home owner after three weeks, it will clean up the land and charge the owner for any expenses, like trash removal or lawn mowing.
⇧ Shawnee County to go after 164 properties with delinquent taxes totaling $2.28 million | CJOnline.com
Once a foreclosure action is filed against a property, the owner must pay the debt in full, Barrett said. Usually six or seven months passes between the filing of the foreclosure lawsuit and the sale of the property, Barrett said. Owners have up until the time of the sale to pay their taxes, she said.
NEWPORT NEWS, Va. (WVEC) — An initiative that began in the fall to clean up or clear out rundown properties continues.
⇧ Sacramento Hikes Fines for Failing to Mow Properties | FOX40
The City of Sacramento is doubling fines for property owners who fail to maintain their lots during fire season.
⇧ Greece’s Ex-Finance Minister Tells All – The New Yorker
This is a very long article, which is typical for The New Yorker. Be warned. It contains blue language.
‘How dare you put such complex issues in front of an electorate??’
That sums up everything wrong with elitism. The Greek people chose correctly, even though the referendum was very poorly worded to be ambiguous.
The FOMC will release its next policy statement on Wednesday. Since its last meeting in June, reported inflation data have barely changed, but there has been a drop of about 19 per cent in the price of oil, and a rise of about 2 per cent in the dollar exchange rate. These two variables were specifically identified when the Fed decided to delay interest rate rises earlier in the year, and the fixed income markets are beginning to think that the same might happen again in the run up to the September meeting.
Well, they better be factoring in the China bust and Iranian oil coming back online shortly. One will boost the dollar and the other will further drop and help to hold down oil prices.
⇧ Poor Little Rich Kids? The Determinants of the Intergenerational Transmission of Wealth
Our findings suggest that wealth transmission is not primarily because children from wealthier families are inherently more talented or more able but that, even in relatively egalitarian Sweden, wealth begets wealth.
⇧ Content Aggregation by Platforms: The Case of the News Media
We study a contract dispute that led a major aggregator to remove information from a major content provider. We find that after the removal, users were less likely to investigate additional, related content in depth, particularly sources that were horizontally or vertically differentiated.
I could have told them that. That’s not because it takes a genius but because it’s obvious. I suspect they substantiated their hypothesis too. If you buy the paper, let me know if that’s right. Thanks.
⇧ Minimum Wage or Living Income? by Robert Skidelsky – Project Syndicate
As robots increasingly replace human labor, humans will need incomes to replace wages from work. …
Both free-market and socialist thinkers have long advocated implementing a basic-income scheme. But the idea has always fallen foul of two objections: societies are too poor to afford it, and it would be a disincentive to work.
The first objection is surely no longer true of the advanced economies, while the second is irrelevant, given that the goal is not to strengthen the incentive to work, but to enable people to live without work. An unconditional basic income would make part-time work a possibility for many who now have to work full-time at non-living wages. And all workers would begin to gain the freedom to make the same choices regarding how much to work, and under what conditions, that owners of substantial capital now have.
⇧ Wealth doesn’t trickle down — it just floods offshore, research reveals | Business | The Guardian
The world’s super-rich have taken advantage of lax tax rules to siphon off at least $21 trillion, and possibly as much as $32tn, from their home countries and hide it abroad — a sum larger than the entire American economy.
James Henry, a former chief economist at consultancy McKinsey and an expert on tax havens, has conducted groundbreaking new research for the Tax Justice Network campaign group — sifting through data from the Bank for International Settlements (BIS), the International Monetary Fund (IMF) and private sector analysts to construct an alarming picture that shows capital flooding out of countries across the world and disappearing into the cracks in the financial system.
“These estimates reveal a staggering failure,” says John Christensen of the Tax Justice Network. “Inequality is much, much worse than official statistics show, but politicians are still relying on trickle-down to transfer wealth to poorer people.
“This new data shows the exact opposite has happened: for three decades extraordinary wealth has been cascading into the offshore accounts of a tiny number of super-rich.”
The surveys that are used to compile the Gini coefficient “simply don’t touch the super-rich,” he says. “You don’t pick up the multimillionaires and billionaires, and even if you do, you can’t pick it up properly.”
⇧ Six Tips for Finding Good Tenants – YouTube
For landlords looking to rent vacant units, finding responsible tenants is a top priority. So check out this video for my six tips on how to find good tenants.
These six strategies may require some investment of time, and potentially some additional financial sacrifice, on the part of landlords interested in going the extra mile to find good tenants. But the investment can pay big dividends for any landlord able to find responsible tenants who pay the rent on time, take good care of the rental property and remain in the unit on a long-term basis.
⇧ We Don’t Need Your Dirty Business: Santa Cruz Washes Its Hands of Felon Banks | Occupy.com
In California, Santa Cruz County Supervisor Ryan Coonerty has written books on capitalism and is a founder of Next Space Coworking, a company specializing in shared workspace. He’s no revolutionary, nor an enemy of the free market. He doesn’t throw bricks. But when the U.S. Department of Justice announced on May 20 that most of the wrongdoer banks were pleading guilty to felonies, Coonerty prioritized local over global, and working people over corporate profits.
If this goes anywhere, how long will it take the megabanks to lobby at the state and federal levels to move politicians there to ban counties and municipalities from refusing to do business with certain banks?
It has happened concerning other industries. On this blog, I’ve reported about it concerning local bans on fracking particularly in Texas. Texas has outlawed cities from banning fracking within city limits.
⇧ New Construction vs. Older Homes: Which is the Better Investment?
You’re ready to buy your first (or next) investment property, but you’re not sure if you should opt for a newly built property (anything constructed in the last 10 years) or an older home. Each has its own pros and cons, and you need to weigh them carefully to figure out which choice is best for you.
You’ll typically receive an insurance-premium credit for new construction and a surcharge for older buildings (even renovated ones).
The number of years will vary by carrier too. For instance, 10 years is not an industry-wide fixed time-frame in insurance for deeming a property “new.”
Of course, there are profits to be made by buying low and doing a cost-effective rehab that will offset any insurance-premium surcharge(s).
⇧ New Madrid Study Shows Need for Quake Coverage: Missouri Insurance Director
You can’t always get what you want (or need).
Missouri’s top insurance regulator says a new report on exposures within the reach of the New Madrid seismic zone reinforces the need for residents in affected areas to purchase earthquake insurance.
Missouri Insurance Director John Huff says, however, there is a distinct lack of affordable earthquake coverage in his state….
⇧ The Politics of Economics and ‘Very Serious People’ | The Fiscal Times
First, there is growing evidence that once inequality passes a critical threshold, it becomes a drag on economic growth. So there is an efficiency argument for redistributing income.
Second, it isn’t possible to equalize opportunity without some a priori redistribution. The wealthy have inherent social and economic advantages that perpetuate inequality across generations, and I see no way to solve that without some degree of redistribution through high inheritance taxes or other means.
Third, technological change may doom some households to a meager existence. No matter how hard they try, no matter how much education or retraining they receive, they won’t be able to find jobs that have been taken over by machines and digital technology. That is not their fault, it is an outcome of the economic system itself, and some type of social insurance that augments their income is appropriate in such a case.
That’s at the very least.
The IMF is, on its own, highly constrained. Its loans are limited to a multiple of a country’s contributions to its capital, and by this measure its loans to Greece are higher than any in its history. Eurozone governments, however, face no such constraints, and were thus free to put in place a program that would have been sustainable.
That’s what I thought, though the mainstream media made it sound as if any such program would have been illegal.
Germany could take a haircut if it were willing. Is that right? Would that be legal in the EU and eurozone?
⇧ Commodity prices hit by China woes | FT Markets – YouTube
The FT’s Jonathan Wheatley talks to James Kynge, emerging markets editor, about how a drop in fixed asset investment in China is helping to drive a decline in global commodities prices.
How long do you think it will take before the mainstream starts talking about a hard landing?
The U.S. rental vacancy rate, which is the percentage of rental homes that are vacant, decreased in the second quarter to 6.8% from 7.1%.
“I know well the framework of the deal we signed at the eurozone summit on July 12,” he told Sto Kokkino radio. “We will implement these commitments, irrespective of whether we agree with it or not. Nothing beyond that.”
When he was running, he said he’d end austerity but didn’t. Are we now to believe he has resolve and will default rather than cave in more?
⇧ Pending Sales of U.S. Existing Homes Unexpectedly Declines – Bloomberg Business
So called tight lending-standards are really just proper lending-standards. If we had, had them in place between 2000 and 2008, there wouldn’t have been a massive securitization bubble of toxic mortgages to bust, sending much of the world into a severe recession and some into a major depression, such as Greece. The entire deregulation mania allowed the crash that would not have occurred otherwise.
⇧ FRB: Press Release–Federal Reserve issues FOMC statement–July 29, 2015
The statement offers no new information at all.
⇧ Texas Property Insurers Consider Changes to Hail Policies | Zelle Hofmann Voelbel & Mason LLP – JDSupra
Texas is in the midst of a hail lawsuit crisis. Tens of thousands of lawsuits have been filed across the state, with dozens more being filed every day. Many of the lawsuits involve meritless claims solicited by case-runners acting on behalf of lawyers and brought for the sole purpose of extracting an early-litigation nuisance settlement payment. Abuse and outright fraud are common.
Despite a strong push by the insurance industry and others, the 2015 Texas Legislature failed to pass any significant reform measures to address the abuses giving rise to these lawsuits. With no legislative solution, the insurance industry undoubtedly will react with its own solution — policy form changes.
These changes will include increased hail damage deductibles, limitations on coverage in certain situations such as late notice or older roofs, exclusions for various types of damage and in some situations outright exclusions of coverage for any hail-related damage.
⇧ Where Rents Are Eating Up a Bigger Share of Income – Real Time Economics – WSJ
“While long a condition of low-income households, cost burdens are spreading rapidly among moderate-income households,” a recent report by Harvard University’s Joint Center for Housing Studies said. “Much to their detriment, cost-burdened households are forced to cut back on food, healthcare, and other critical expenses.”
“Strong rental demand, coupled with limited new rental supply and still-underwhelming wage growth, has only exacerbated the problem in recent years,” Ms. Gudell said. “Meaningful growth in wages and a healthy dose of new rental units coming on line will help ease the crunch, but neither will happen overnight.”
The Census Bureau’s U.S. rental vacancy rate, which tracks the share of properties that are unoccupied, fell to 6.8 percent in the second quarter. That’s the lowest level using comparable data since 1985.
…rents are “set to accelerate,” wrote Ed Stansfield and Andrew Hunter, economists at Capital Economics Ltd., in a note to clients. “Our forecasts that rents will grow at an annual rate of 5 percent both this year and next would represent the fastest rate of rental growth since the 1980s.”