EP search results,commercial mortgages.
I went looking for the commercial real estate only option arm adjust graph and couldn't find one that was just commercial.
It's just ridiculous to me how U.S. manufacturers are just ignored. And this isn't the MNCs wanting to offshore outsource production to China and labor arbitrage around the globe (hey GM, howz that workin' out fer ya!) but the U.S. only based manufacturing.
Yesterday I wrote an Instapopulist on the 2008 tax rebate. It cost $158 billion dollars and gave a little "jump" (or not depending on which analysis you think is correct) for about a month or so, then back towards the slide.
I imagined what that money could have done if investing in U.S. manufacturing, bothering to tackle just any one of many trade reforms needed and tell all of those nations who don't like "buy American" to stick it, and btw, list every single one of those other nation's subsidies (including national health care!) while they are at it.
I mean it's like the spin machine wants to make the public believe manufacturing doesn't matter and as your EI analysis points out, manufacturing is critical to the true health of the U.S. economy.
So, it was not only residential mortgages with interest only mortgages. It was commercial mortgages too:
Investors in bonds that packaged $62 billion of debt for U.S. offices, hotels and shopping malls are bracing for more loan defaults through 2010 as Bank of America Merrill Lynch says landlords’ monthly payments may jump 20 percent or more.
Principal is coming due on the so-called partial interest- only loans as an 18-month-old recession saps demand for commercial real estate. About $179 billion of such loans were written between 2005 and 2007 and bundled into bonds, according to data from Bank of America Merrill Lynch.
Amazing what happens when an economy has too much liquidity.
In Oregon we've had land use laws attempting to prevent this since 1972- and in the Portland and Eugene Metro areas, I've got to say it's largely failed, despite the robust farmer's markets.
Near as I can tell, we've been heading down this line since 1948 and the assumption the countries can replace war with trade (they can, but it just becomes a trade war with less pain spread out over more time, instead of big pain in a short time).
-------------------------------------
Maximum jobs, not maximum profits.
It's the new "good".
The fact that the rate of descent has moderated may sound good, but it isn't because we've already mortgages the nation to make it happen. That's a very poor ROI.
For years I've witnessed the CBO use adjectives such as estimates and projections. They play fast and loose with such adjectives.
The folks with the degrees and using operational research analysis to come up with the numbers to suit their needs. Sorry but they make me nervous and distrust comes to mind. Remember the roaring 1990's and the little trick called the Dot Com bubble. During the tech boom, the venture capitalist money was flowing like water. I knew people that worked at Apple and heard about the great parties. You had unknown business owners that after their IPO, became overnight millionaires. Then it all quickly vanashed, as if it were a dream.
Follow back a little bit further and you will can start to see when this wage stagnation - low imported product cost ratio started. The world and major economies are paying the price of the stagnating wages - low cost imported products ratio. Not sure if any of the western civilization will recoup their losses.
When it comes to financial magic, the government of the United States takes the prize. Sleights of hand and clever distractions by purveyors of line-of-credit mortgages, living-benefit variable annuities and equity-indexed life insurance are clumsy parlour tricks compared with the Big Magic of American politicians. Consider the proud trumpeting that came from Washington at the close of fiscal 2007. The deficit for the unified budget was, politicians crowed, down to a mere $162.8 billion. In fact, the U.S. government is overspending at a far greater rate. The total federal debt actually increased by $497.1 billion over the same period.
But politicians of both parties use happy numbers to distract American voters. Democrats routinely criticize the Republican administration for crippling deficits, but they politely use the least-damaging figure, the $162.8 billion. Why? Because references to more-realistic accounting would reveal vastly greater numbers and implicate both parties.
You can understand how this is done by taking a close look at a single statement on U.S. federal finance from the president's Council of Economic Advisers. The September statement shows that the "on-budget" numbers produced a deficit of $344.3 billion in fiscal 2007. The "off-budget" numbers had a surplus of $181.5 billion. (The off-budget figures are dominated by Social Security, Medicare and other programs with trust funds.)
Some numbers don't add up But if you examine another figure, the gross U.S. federal debt, you'll see something strange. First, the U.S. debt has increased in each of the past eight years, even in the two years when surpluses were reported. Second, the gross federal debt, which includes the obligations held by the Social Security and Medicare trust funds, has increased much faster than the deficits -- about $3.3 trillion over the same eight years.
That's $2 trillion more than the reported $1.3 trillion in deficits over the period. Can you spell "Enron"?
You can even go back to articles in 1998 that mention declining standards, "under the last two presidents our standards have dropped"
Newt Gingrich and company -- for all their faults -- have received virtually no credit for balancing the budget. Yet today's surplus is, in part, a byproduct of the GOP's single-minded crusade to end 30 years of red ink. Arguably, Gingrich's finest hour as Speaker came in March 1995 when he rallied the entire Republican House caucus behind the idea of eliminating the deficit within seven years.
Now for the bad news for GOP partisans. The federal budget has not been balanced by any Republican spending reductions. Uncle Sam now spends $150 billion more than in 1995. Over the past 10 years, the defense budget, adjusted for inflation, has been cut $100 billion, but domestic spending has risen by $300 billion.
We have a balanced budget today that is mostly a result of 1) an exceptionally strong economy that is creating gobs of new tax revenues and 2) a shrinking military budget. Social spending is still soaring and now costs more than $1 trillion. Is this the kind of balanced budget that fiscal conservatives want? A budget with no deficit, but that funds the biggest government ever?
The budget surpluses over the next five years could easily exceed $500 billion. Leaving all of that extra money lying around within the grasp of vote-buying politicians is an invitation to financial mischief. If Congress and the president use the surpluses to fund a new spending spree, we may find that surpluses are more a curse than a blessing.
So with all the financial wizardry going on out there you can find one site saying yes and another site saying the answer is no.
us, do you want to be hanged at sun up or sun down. A balanced budget, a long term view of life, is something Americans no longer understand.
Yesterday I was reading a post from a woman complaining about how here three meds (BP and pain) were do for refill. She only had twenty dollars and that would only buy two prescriptions. Ok, staring me in the face is a woman saying she couldn't pay for her pain meds. Aside from the hard asset of the computer, how much does internet access cost each month? I would bet it would pay for her meds.
I've played in the very poor sandbox, didn't like it. I went without a lot, like a mattress to sleep on etc. There was a period that I didn't even have a roof over my head. I went without so many things. My experience was 37 years ago and I think American's today confuse want and need more than people did 37 years ago.
It would be refreshing if the governing body would show that they know the difference between want and need, if they would set the tone and balance their accounts. From the Feds to the States they are all in debt. Debts need to eventually be paid. Debt and people that didn't understand how to manage debt helped to start us on this failing economy?
Of the $ trillions the Feds are spreading into the system, how much is waste? How much really goes to fuel a growing economy. Funds that go out and can't be tracked is a foolish program. We give $billions to some car manufacturers and those said manufacturers are now in bankruptcy.
I would think to take our medicine now is better than to put off the problem, to hide our heads, to live in denial of a problem. It finally might be clear that it is better to heal the problem now, than at a later date have our legs amputated.
If anyone has a chance, please take a gander at this article from the Atlantic magazine. It's basically how deBeers sold America diamonds. But what's interesting is the part about when the Soviets got into the act and how deBeers had reacted. Here you had the emergence of a rival source of diamonds, smaller than the ones coming out of Africa, but in much larger quantities. The famed diamond monopoly rushed to make a deal with the Kremlin, thinking they could get things under control. Problem was, deBeers underestimated the supply that could come out of Siberia.
Its a really interesting piece. You see how they had to essentially put into conflict everything they said about regular sized diamonds to push the smaller gems. This campaign would also have some unintended consequences. Your talk about price drops and supply reminded me of that article.
I'll give you that, but from almost a philosophical viewpoint, a sociological viewpoint, it really made my brain whirl. But yes, it's not a real documentary but it is some serious food for the brain, especially if one has read R.D. Laing, knows some of game theory, familiar with Hayek, etc.
At least for me, the "me first, fuck you" society has become dominant and it used to not be that way overall.
"...people today live so far from the means of production that they are unable, in a time of decreased trade and decreased credit, to access the basic necessities of life."
You seem surprised--this squeeze has been apparent since at least 1990. But you are correct...we are screwed. No vaseline in sight!;-)
The annual mandated expenditures voted in by all the various legacy initiatives, plus the Prop. 13 tax caps, plus the CalPers unfunded state employees pension liabilities, plus the state prison guard unions, plus...
Fact: everyone wants to take, but no one wants to pay in.
Golden State=BK.
This series, 'the Trap' was one of the most bizarre concoctions ever to be green lighted by the BBC. I understand that despite the drastic global increase in government spending over the last 100 years, 'the Trap' wants to make the 'market' out to be the bad guy. Ok fine, have at it, provoke away with the narrow, single viewpoint diatribe. The problem is not that the assertions in The Trap weren't right, it's that they weren't even wrong. Words like 'freedom' and 'economics' and 'the market' have to be completely redefined for the series to even be coherent. Never mind the sensationalist MTV style wreck of a production.
Love the Sierra, love the coastline north of Santa Barbara, love the desert, love San Francisco, though I don't much care for LA or San Diego. But Prop 13 and the 2/3d's rule has made it completely ungovernable.
I have no idea what's going to happen, only that it will in all probability seriously suck (though I'll be happy to be wrong).
We may not be Japan, but we're not Argentina or Thailand either, which means there is nobody out there big enough to bail us out if we collapse. If we collapse on a truly epic scale we'll be a lot smaller of course -- but so too will be everyone else. This is not a linear system, especially since we hold the de facto reserve currency. The collapse of the peso and baht were traumatic enough to the global economy, imagine the collapse of the dollar. Some may survive better than others but no one is going unscathed or close to it.
I'm leaning towards NDD here, but your positions are not entirely orthogonal. Clearly some choices will be forced on us, some for the better, like the fact that we can't spend 600B/yr to be the world's policeman anymore. Top marginal tax rates have to go up, and we'll have to treat income as income, not wages vs capital gains. We might well see de facto devaluation. I think we need to invest in education, science and technology, and modern infrastructure for as long as we can: doing so won't bleed us to death unless we're already terminal, and not doing so would guarantee an even longer rockier recovery. Things are still going to be grim, but I don't think they need be quite so grim for quite so long if we start acting like grownups now.
It's interesting that Edward E. Whitacre, Jr. has been named Chairman of General Motors now. As a member of the board of directors of the Peterson Institute for International Economics, he brings along that 'tute's long-term agenda for offshoring American jobs and privatizing social security, no doubt!
I agree with you. Beyond some of the beauty, which one really couldn't enjoy due to the massive traffic jams and hordes of people around...California is one hell hole to me.
But it's fascinating to watch a state with so much resources basically f**k itself into the ground. I mean what a situation that didn't need to happen.
EP search results,commercial mortgages.
I went looking for the commercial real estate only option arm adjust graph and couldn't find one that was just commercial.
That would be useful.
After backing out Nonprofit organizations. Household Real Estate according to fair market value is about 30% of total assets.
I would consider the home evaluations with their bubble prices to be fictional wealth...
it hid the Bush years economic Armageddon on the U.S. middle class.
At least household debt contracted.
It's just ridiculous to me how U.S. manufacturers are just ignored. And this isn't the MNCs wanting to offshore outsource production to China and labor arbitrage around the globe (hey GM, howz that workin' out fer ya!) but the U.S. only based manufacturing.
Yesterday I wrote an Instapopulist on the 2008 tax rebate. It cost $158 billion dollars and gave a little "jump" (or not depending on which analysis you think is correct) for about a month or so, then back towards the slide.
I imagined what that money could have done if investing in U.S. manufacturing, bothering to tackle just any one of many trade reforms needed and tell all of those nations who don't like "buy American" to stick it, and btw, list every single one of those other nation's subsidies (including national health care!) while they are at it.
I mean it's like the spin machine wants to make the public believe manufacturing doesn't matter and as your EI analysis points out, manufacturing is critical to the true health of the U.S. economy.
Bondholders Face Losses From Commercial Mortgages
So, it was not only residential mortgages with interest only mortgages. It was commercial mortgages too:
Amazing what happens when an economy has too much liquidity.
In Oregon we've had land use laws attempting to prevent this since 1972- and in the Portland and Eugene Metro areas, I've got to say it's largely failed, despite the robust farmer's markets.
Near as I can tell, we've been heading down this line since 1948 and the assumption the countries can replace war with trade (they can, but it just becomes a trade war with less pain spread out over more time, instead of big pain in a short time).
-------------------------------------
Maximum jobs, not maximum profits.
Was giveaways to corporations, not entitlements for individual citizens.
So in that view, they're right.
-------------------------------------
Maximum jobs, not maximum profits.
It's the new "good".
The fact that the rate of descent has moderated may sound good, but it isn't because we've already mortgages the nation to make it happen. That's a very poor ROI.
For years I've witnessed the CBO use adjectives such as estimates and projections. They play fast and loose with such adjectives.
The folks with the degrees and using operational research analysis to come up with the numbers to suit their needs. Sorry but they make me nervous and distrust comes to mind. Remember the roaring 1990's and the little trick called the Dot Com bubble. During the tech boom, the venture capitalist money was flowing like water. I knew people that worked at Apple and heard about the great parties. You had unknown business owners that after their IPO, became overnight millionaires. Then it all quickly vanashed, as if it were a dream.
Follow back a little bit further and you will can start to see when this wage stagnation - low imported product cost ratio started. The world and major economies are paying the price of the stagnating wages - low cost imported products ratio. Not sure if any of the western civilization will recoup their losses.
You can even go back to articles in 1998 that mention declining standards, "under the last two presidents our standards have dropped"
No, Bill Clinton Didn't Balance the Budget
So with all the financial wizardry going on out there you can find one site saying yes and another site saying the answer is no.
Why do I feel like a pawn?
The dynamics have changed. We manufacture very little.
us, do you want to be hanged at sun up or sun down. A balanced budget, a long term view of life, is something Americans no longer understand.
Yesterday I was reading a post from a woman complaining about how here three meds (BP and pain) were do for refill. She only had twenty dollars and that would only buy two prescriptions. Ok, staring me in the face is a woman saying she couldn't pay for her pain meds. Aside from the hard asset of the computer, how much does internet access cost each month? I would bet it would pay for her meds.
I've played in the very poor sandbox, didn't like it. I went without a lot, like a mattress to sleep on etc. There was a period that I didn't even have a roof over my head. I went without so many things. My experience was 37 years ago and I think American's today confuse want and need more than people did 37 years ago.
It would be refreshing if the governing body would show that they know the difference between want and need, if they would set the tone and balance their accounts. From the Feds to the States they are all in debt. Debts need to eventually be paid. Debt and people that didn't understand how to manage debt helped to start us on this failing economy?
Of the $ trillions the Feds are spreading into the system, how much is waste? How much really goes to fuel a growing economy. Funds that go out and can't be tracked is a foolish program. We give $billions to some car manufacturers and those said manufacturers are now in bankruptcy.
I would think to take our medicine now is better than to put off the problem, to hide our heads, to live in denial of a problem. It finally might be clear that it is better to heal the problem now, than at a later date have our legs amputated.
If anyone has a chance, please take a gander at this article from the Atlantic magazine. It's basically how deBeers sold America diamonds. But what's interesting is the part about when the Soviets got into the act and how deBeers had reacted. Here you had the emergence of a rival source of diamonds, smaller than the ones coming out of Africa, but in much larger quantities. The famed diamond monopoly rushed to make a deal with the Kremlin, thinking they could get things under control. Problem was, deBeers underestimated the supply that could come out of Siberia.
Its a really interesting piece. You see how they had to essentially put into conflict everything they said about regular sized diamonds to push the smaller gems. This campaign would also have some unintended consequences. Your talk about price drops and supply reminded me of that article.
--------------------------------------------
www.venomopolis.com
I'll give you that, but from almost a philosophical viewpoint, a sociological viewpoint, it really made my brain whirl. But yes, it's not a real documentary but it is some serious food for the brain, especially if one has read R.D. Laing, knows some of game theory, familiar with Hayek, etc.
At least for me, the "me first, fuck you" society has become dominant and it used to not be that way overall.
"...people today live so far from the means of production that they are unable, in a time of decreased trade and decreased credit, to access the basic necessities of life."
You seem surprised--this squeeze has been apparent since at least 1990. But you are correct...we are screwed. No vaseline in sight!;-)
The annual mandated expenditures voted in by all the various legacy initiatives, plus the Prop. 13 tax caps, plus the CalPers unfunded state employees pension liabilities, plus the state prison guard unions, plus...
Fact: everyone wants to take, but no one wants to pay in.
Golden State=BK.
This series, 'the Trap' was one of the most bizarre concoctions ever to be green lighted by the BBC. I understand that despite the drastic global increase in government spending over the last 100 years, 'the Trap' wants to make the 'market' out to be the bad guy. Ok fine, have at it, provoke away with the narrow, single viewpoint diatribe. The problem is not that the assertions in The Trap weren't right, it's that they weren't even wrong. Words like 'freedom' and 'economics' and 'the market' have to be completely redefined for the series to even be coherent. Never mind the sensationalist MTV style wreck of a production.
Love the Sierra, love the coastline north of Santa Barbara, love the desert, love San Francisco, though I don't much care for LA or San Diego. But Prop 13 and the 2/3d's rule has made it completely ungovernable.
I have no idea what's going to happen, only that it will in all probability seriously suck (though I'll be happy to be wrong).
We may not be Japan, but we're not Argentina or Thailand either, which means there is nobody out there big enough to bail us out if we collapse. If we collapse on a truly epic scale we'll be a lot smaller of course -- but so too will be everyone else. This is not a linear system, especially since we hold the de facto reserve currency. The collapse of the peso and baht were traumatic enough to the global economy, imagine the collapse of the dollar. Some may survive better than others but no one is going unscathed or close to it.
I'm leaning towards NDD here, but your positions are not entirely orthogonal. Clearly some choices will be forced on us, some for the better, like the fact that we can't spend 600B/yr to be the world's policeman anymore. Top marginal tax rates have to go up, and we'll have to treat income as income, not wages vs capital gains. We might well see de facto devaluation. I think we need to invest in education, science and technology, and modern infrastructure for as long as we can: doing so won't bleed us to death unless we're already terminal, and not doing so would guarantee an even longer rockier recovery. Things are still going to be grim, but I don't think they need be quite so grim for quite so long if we start acting like grownups now.
It's interesting that Edward E. Whitacre, Jr. has been named Chairman of General Motors now. As a member of the board of directors of the Peterson Institute for International Economics, he brings along that 'tute's long-term agenda for offshoring American jobs and privatizing social security, no doubt!
I agree with you. Beyond some of the beauty, which one really couldn't enjoy due to the massive traffic jams and hordes of people around...California is one hell hole to me.
But it's fascinating to watch a state with so much resources basically f**k itself into the ground. I mean what a situation that didn't need to happen.
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