patrick.net

“…the sciences of human action differ radically from the natural sciences. All authors eager to construct an epistemological system of the sciences of human action according to the pattern of the natural sciences err lamentably.

indigenous says

CaptainShuddup says

"What in the fuck is he doing to fix it?"

That is the problem, it's like FDR all over again.

Sometime the problem with what someone did, was what they didn't do.

When I say "what is he going to do" I don't mean give small businesses incentives or any unfair advantage.

All I expect is our government to make sure that large corporations
A)aren't given an unfair advantage over small busieness or any business for that matter.
B)make sure that large corporations aren't using their money, might and power to give them an ufair advantage that is detrimental to small business growth.

NOw please don't play stupid, it's only the very same fucking considerartion that OBama's hand picked Greenie bastard's got, when our Government stepped in and interviened when China tried to give us Cheap solar panels.

Well guess what?

We fucking GOT Chinese solar panels, OH YES WE DID.
Our Obama funded Solar panel companies CEO's raided their Tax funded company and drove them into bankrupcy, then formed new corporations that took full advantage of those cheap Chinese solar panels. Who now buys them, for pennies on the dollar over what they made them for. Then mark them up to the point. That now you can buy Solar panels for less than half of what they cost in 2008-2012. When we were making them. But still double over what the Chinese were offering them to the American public.

Large corporations who are in the FIX, got the savings, and passed the fucking on to the consumer.

That's what I mean when I say our government should "Do something".

Quit being obtuse.

CaptainShuddup says

When I say "what is he doing to" I don't mean give small busienss incintives or any unfair advantage.

That is small potatoes, I'm talking about the ACA, Frank Dodd, and TBTF

All this shit is a gargantuan yoke to the economy, directly and indirectly.

Fuck the small shit, I'm talking about nation ending shit.

indigenous says

Fuck the small shit, I'm talking about nation ending shit.

ACA is the first step of the transition from our truly disastrously rapacious national health system to one more like the rest of the world, with cost controls and more -- at least more effective, since prior to ACA gov't -per-capita expenditure on health was already more than many other nation's total expenditure -- government intervention.

ACA is far from "nation ending". Stop watching Fox, get out in the world, grow a fucking brain, and learn how to use it.

http://research.stlouisfed.org/fred2/graph/?g=Ak2

Gov't expense on health care / GDP.

http://research.stlouisfed.org/fred2/graph/?g=Ak4

private expense / GDP, showing it go from 9% in the 1990s to 11% when the economy tanked and the denominator melted away.

UK and Germany have 40% tax-to-GDP, many other eurosocialist states are pushing 50%. The US is down at 27%.

http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP

the bottom line is simply we've given ourselves too many tax cuts and allowed the 1% and 0.1% to accumulate too much economic and political power now, power that conservatives are apparently honor-bound to defend to their dying breath.

We've also made colossal malinvestments in empire-building, conservative enterprises the GOP are trying to slow-walk from today, or at least not pay for via the higher taxes necessary to retire these trillion dollar debts run up since 2001.

We can argue bullshit all day and all week, but the bottom line is health care, education, real estate, legal services, finance, transportation -- all higher-order functionality of our economy -- has become rather completely fucked over by rent-seeking "professional" class and legislative partisan gridlock.

Compounding matters is our colossal trade deficit that is making our national fisc increasing unstable, as we are not even able to fully support ourselves, unlike the more successful export-oriented eurosocialist states.

Hell, even Greece is running a trade surplus now.

http://online.wsj.com/news/articles/SB10001424052702303775504579392520969915920

I will decide whether I'm pro or against this when I learn the details of the implementation. ;)

Bellingham Bill says

t least more effective, since prior to ACA gov't -per-capita expenditure on health was already more than many other nation's total expenditure -- government intervention.

What makes you think that gov't intervention did not cause the high per capita health care costs in the first place?

Bellingham Bill says

-- has become rather completely fucked over by rent-seeking.

The rent seeking is as much by public unions as by cronies.

Bellingham Bill says

Compounding matters is our colossal trade deficit that is making our national fisc increasing unstable, as we are not even able to fully support ourselves, unlike the more successful export-oriented eurosocialist states.

The trade deficit is not of too much consequence albeit when it runs too long in one direction, as with China as industries are lost, mercantilism is too much of a benefit to the government as with Germany and China at the expense of their people.

I might add that one of the problems with the trade deficit is that Milton Friedman created a floating exchange rate that automatically adds to the money supply. The target amount is 3%, imagine what that looks like compounded over 40 years. This means that there is plenty of inflated money to buy Chinese goods.

If you drive a car, I'll tax the street
If you try to sit, I'll tax your seat
If you get too cold I'll tax the heat
If you take a walk, I'll tax your feet...

Tax Oxygen, Sunlight, Time, Space, and every element on the periodic table.

Trust me when I say that Tax and Spend and Outsourcing is going to work if we just give it enough time. Another couple of years, decades, centuries and Millenia will prove this soon enough.

justme says

Senator Mark DeSaulnier is a fool. What a royally stupid idea. The correct solution is HIGHER GASOLINE TAX.

The point is road financing, not punishing or promoting particular behaviors.

Everyone wants a free lunch, nobody wants to pay for it.

Vicente says

If you cut that stream drastically by driving hybrids or electrics

If the electrics use hydrogen in a fuel cell, then standard fuel taxes would apply.

If they use batteries, then aren't utilities already charging taxes?

Hybrids still use both gasoline and (taxed?) electricity (if they are plugins).

In all cases, it would seem that the idea of a per mile tax already exists by virtual of fuel consumption. Unless someone is running his car in neutral all day.

Vancouver sees the country’s biggest drop in new home prices

The price of new homes dipped in the twelve months to March, according to the New Housing Price index released by Statistics Canada May 8.

Year-over-year, prices were 1.1% lower than a year ago. This represents the biggest drop in the country compared with all other major cities. Ottawa-Gatineau came in second place with a decrease of 1.0%.

Victoria (down 0.9%), Edmonton (down 0.1%) and Charlottetown (down 0.4%) were the only other cities where prices dropped over the year.

http://www.biv.com/article/20140508/BIV0111/140509925/vancouver-sees-the-country-8217-s-biggest-drop-in-new-home-prices

Vancouver is the canary on the tar sands.

Heraclitusstudent says

Is this the decline of standards of living, or is this deliberately organized scarcity?

The best land is always claimed first.

Land value comes from more than the natural amenity of location or just its natural productivity (ag or mineral), it is largely driven by what commercial, governmental, and cultural amenities are accessible in the local community.

Canada, on the top half of the continent but with less population than California, has 60 acres per capita, but most of these acres have minimal community amenities.

shows ~6 major metro areas. That's where the land value is.

A very similar story applies for Australia, alas.

Tons of land, but you've always got to outbid somebody else for the good locations that are accessible to and thus provide a modern, 21st century standard of living.

This is the basic thesis of Henry George's Progress and Poverty. Discovering it last decade was a real a ha! moment, LOL.

John Bailo says

If they use batteries, then aren't utilities already charging taxes?

That isn't earmarked for ROADS. You want to tinker with the structure fine, but to data it's been fairly simple, tax the fuel to pay for the roads. Now it's getting complicated.

edvard2 says

There's a big difference between having 5.5 million 'worth' in assets versus being actually worth 5.5 million bucks. Nevertheless, different people have different things they invest in because they feel they are either safer, better, or more likely to generate income. ALL are risks. Real Estate is perhaps a bigger risk since its value is heavily tied to the overall job market and in particular the success of the middle class. Seeing as how the middle class has been stagnate for years with little evidence in any meaningful change, that is a consideration.

Yes, all are risks. I know you're biased toward stock while I'm biased toward real estate. Our debate will likely go no where so we will have to agree to disagree.

Have a wonderful Mother's Day weekend.

Share of Stimulus going to banks and lawyers, FOO = 100%.

Share of stimulus going to firms that can have ROI=0%.

Any questions?

Gotta love my partner. He rents that 4-bedroom house in Brazil for $1,150/month, and he's charging the visitors an average $100/night/room. He's almost fully booked. The "Beautiful and Spacious Suite" is his own bedroom. LOL! He's truly a business man.

https://www.airbnb.com/s?host_id=10133644

edvard2 says

Real Estate is perhaps a bigger risk since its value is heavily tied to the overall job market and in particular the success of the middle clas

Demographics is going to drive a lot. Unlike smartphones, we can't import land, and we're not building near enough new housing at any rate.

is the basic lay of the land, demographically from now to 2060. Blue is age 22-79, red is age 22-39, showing the induction of Gen Y (the echo boom) along with the original boomers, who are still going to occupy if not consume housing for the next few decades.

Our economy is a battle between rent-seekers, and landlords still have a very strong whip hand, even compared to doctors hospitals and corporate america overall.

If Coke raises prices, you can skip a week of Coke consumption or go store brand. You can't skip a week of paying the man for housing. Try it sometime at least.

Bellingham Bill says

Tons of land, but you've always got to outbid somebody else for the good locations

Now add in more warmth and rainfall from global warming plus off grid technologies like solar, hydrogen and greywater recycling.

You can go "off grid" all you want but if the nearest Trader Joes is more than an hour away, count me out.

Then again my big biz idea (the one thing I'd do if I had $10M of capital available) is a global Costco / Whole Foods / Trader Joes delivery service, since I do see reliance on weekly shopping to be the big pitfall of OTG life.

http://en.wikipedia.org/wiki/Pirate_Joes

http://www.theflyingpig.com/tfp/shop.asp

I here by am officially changing my position on a future of George Jetson flying cars. At first I thought man was too stupid and needed protecting from such carnage. Interstate off ramps would like the aftermath of a Hornets nest meets soap suds.
But Fuck 'em, put rocket launchers and pules phaser lasers to vaporize bad drivers veering off in your direction.

But of course that would still wouldn't make us neither immune nor impervious to wonton lust of the Liberals who want to tax every one for shit, because it gives them a hardon.

WOW! The UNtrustworthy are certainly in control of what information is apparent to the people!

Say hey! This was in the Wall Street Journal on March 30, 1999. Note "... how much it will buy."

Holy cow/interesting/compelling ...!

And where is it up to date??? Right here ... see the first chart shown in this thread.
Recent Dow day is Friday, May 9, 2014 __ Level is 104.8

WOW! It is hideous that this is hidden! Is there any such "Homes, Inflation Adjusted"? Yes! This was in the New York Times on August 27, 2006:

And up to date (by me) is here:
http://patrick.net/?p=1219038&c=999083#comment-999083

WOW! The UNtrustworthy are certainly in control of what information is apparent to the people!

And "ThePublic Be Suckered"
http://patrick.net/?p=1230886

What I find so so amusing about the bulls patting themselves on the back about how well they "understand the market" is their ignorance of the acts of the Fed and the Treasury. Yes Ignorance...ignore...ance! How in denial can you be? How can you even CALL it a market at all when the Fed has been spending up to one billion dollars a day on failed mortgage-backed securities for not just a week or two, but continuously, day in and day out, for up to SIX years, now.

One of the reasons the crash is so apparently coming is that even the dovish Fed hold-outs are are now warning of the dangers of stopping the tapering of QE. 9 figure per day sums have been propping up your favorite. "markets" for years and years.

Explain to us one more time which fundamentals are going to replace the 85 Billion dollar per month goose, as it is slowly reduced to nothing but a fowl dinner for two.

When I hear an RE bull bragging about his winnings on the back of mind-bogglingly massive money printing is not a thought of "rats...I wish I'd been more optimistic about that market too", but rather. "yeah well you're not really welcome, but I'll say it to be the bigger man. You're welcome. But our children's future pain on your behalf is hardly my pleasure."

And I'll take a cup of the java...as long as it's "ice" coffee.

Jeez, I'm sure glad the upper classes have so many arguments.

deepcgi says

ignorance of the acts of the Fed and the Treasury. Yes Ignorance...ignore...ance!

The steam is running out of em big time. Market forces will work its way out from here on cuz federal debt is simply unsustainable.

http://www.concordcoalition.org/issues/indicators/projected-debt?gclid=CMq4iNOCo74CFYJqfgodPXQA6g

In California we pay 78 cents per gallon tax, that's enough.

So not only do you pay taxes on every gallon you buy, you pay extra taxes on every mile you drive. As usual the bums and welfare cases will be exempted. The same fools will then claim they want progressive taxation and would want the rich folks to pay their "fair share" and increase the per mile tax for people with money to a gazillion percent. Then the bums will demand a new car with the extra money-while living in Malibu in sec 8 housing- all the while screaming about income inequality and how evil the 1% are.

No country for hard working folks. This country is only for people who know how to work the system-weather you are a bum or a billionaire.

clambo says

that's enough.

It's never ENOUGH.

deepcgi says

spending up to one billion dollars a day on failed mortgage-backed securities

while there is a strong correlation between Fed MBS buys and home prices:

http://research.stlouisfed.org/fred2/graph/?g=Amg

(MBS YOY growth is blue, Case Shiller is red)

"failure" has no meaning to the Fed, since it is the only entity in the dollar bloc that can print.

Plus you have to demonstrate how the Fed's MBS purchase have "failed" already; with prices well off the 2010 lows, no new borrower should be underwater now, even with a low-down FHA offering.

No doubt I have family a little outside Toronto. It's expensive up there. I don't know how they afford real estate. It's like Orange County Ca or San Francisco prices for everyone. Plus wages have stagnated like USA. I mean a movie costs you about $13 and that's couple years ago. It's plain expensive in Canada.

The Professor says

Buy now or be priced out FOREVER!

http://research.stlouisfed.org/fred2/graph/?g=AmB

blue is money supply

red is case shiller

showing money supply has doubled since 2005, while prices are just about back to 2005 levels.

I can't see the future, but I do know everything is predicated on higher home valuations, the system is totally biased towards enforcing that trend.

Bellingham Bill says

Canada, on the top half of the continent but with less population than California, has 60 acres per capita, but most of these acres have minimal community amenities.

Absurd. Most communities in Canada have space to build. The one in Yellow on your map have lots of space.

It is not a lack of space.
It is not that the price doesn't make it feasible to build. Prices are very high.

So why aren't they building?

Because of an evil scheme authorities are using to boost growth: make housing increasingly more expensive - by deliberately suppressing supply.

Not only it is evil, it totally fails to boost growth in the long term.

Vicente says

Yeah everyone wants to drive on the roads, nobody wants to pay for them.

We already pay for roads with the hundreds of other taxes we pay. When is enough enough? These politicians frivolously spend our money and when they run out of money, they simply invent new taxes instead of curbing their wild spending habits.

The average American is forced to work harder and cut their budgets just to get by because of higher and higher costs. Yet these politicians feel they its a good idea to put additional pressure on peoples budgets. BRAVO!!! When are we going to vote this idiot out of office?

epitaph says

If you drive a car, I'll tax the street

If you try to sit, I'll tax your seat

If you get too cold I'll tax the heat

If you take a walk, I'll tax your feet...

sounds like california..

Vicente says

That isn't earmarked for ROADS. You want to tinker with the structure fine, but to data it's been fairly simple, tax the fuel to pay for the roads.

So the fact that we have the highest gas tax in the country is not good enough?

http://www.bankrate.com/finance/taxes/states-with-highest-gasoline-excise-taxes-2.aspx

Why dont you focus your attention to the real problem, which is spending. If we actually spent the money earmarked for roads on the roads, then we wouldnt have this problem.

Bellingham Bill says

shows ~6 major metro areas. That's where the land value is.

A very similar story applies for Australia, alas

.Heraclitusstudent says

So why aren't they building?

Because of an evil scheme authorities are using to boost growth: make housing increasingly more expensive - by deliberately suppressing supply.

Not only it is evil, it totally fails to boost growth in the long term.

The land value is because Australia and Canada and others have chosen to not embrace American style endless suburban sprawl. There are urban boundries in both countries that constrain building outside the cities. Even smaller towns embrace carefully controlled building area's. I've rented in Oz and built a house in NZ so I'm real familiar with the urban boundary issues good and bad.

There's nothing evil, it's a societal choice that they are willing to pay for. The extra cost in housing is heavily offset by not having to extend expensive services, (water, sewer, electric, trash, roads, police, etc., etc.) endlessly. People overseas I've talked to about it think American suburban sprawl is horrifying and can't believe we allow it.

Bastille Day wasn't a holiday before it happened. The houses, which they do make more and more of all the time, are simply too expensive vs the average salary. The enormous growth in all cash purchases is an excellent sign of a market driven by speculation - but not speculation based on the fundamentals which SHOULD matter like new household creation or rising employment numbers in the under 35's demographic, but based on carry trades, derivatives, phantom banking in China and secret manipulations by the Fed. The baby boom wants to retire and the youth are unemployed, shacking up with family at 33 years old, and wholly not ready or willing to fund their own grandma's retirement, let alone someone else's. In fact, grandma is the one they hope to score zero interest loans from to payoff the student loans.

Ross Perot was right back then. He would have opposed Greenspan's fueling of the Tech Bubble and subsequent RE bubble, and I expect the pain that will visit our kids would be less debilitating than it certainly will be.

Just remember, I'm square in the middle of the target market of potential buyers with enough cash for big down payment on a sweet home, and I'm absolutely not going to buy. All bogus, manipulated, speculation-driven, fiat disaster.

I personally don't see hyper inflation at this point as the immediate danger. I see an event of economic punctuated equilibrium. Some ass world leader needs no one's permission to start the ball rolling away from central bank cooperation.

all bubbles crash eventually, Canada is in a MASSIVE real estate bubble and the longer it goes on the harder it will crash. Bubbles can go on for years without crashing so your data is virtually pointless. When the bubble will crash is something that is impossible to predict...it could be next week, it could be 4 years from now. As I said the longer it goes on the worse the outcome when it eventually crashes.

deepcgi says:
"All bogus, manipulated, speculation-driven, fiat disaster."
Let's keep this between you & me.

It is nice that Canadians can continuously overpay for housing.

I just renewed my lease here in Austin. Paying 1550 per month for 2600 nice (but slightly strange) square feet. :-).

RR is one of the best public school districts in the country. Elementary school is across the street. The crossing guard for the kids stands at the end of my driveway - although the girls have to walk across the playground to get to the entrance. Oh well.

The interesting thing though is that a nearly identical home only one lot away went up for rent for 2200 several weeks ago. There's been a big jump for a lot of people. It's why the current family is moving out.

Why did MY landlord not hit me with a huge jump in rent? Why are they allowing a bail-out of lease clause in the event of employment troubles? Because the real world isn't always as the numbers would lead you to believe. Imagine renting out a home for 4 years and the carpets are still spotless to the point where they wouldn't need a cleaning if you needed to rent it tomorrow. Imagine tenants who spot maintenance problems like pros, do all of the homework on repairs, pay rent early and keep the yard looking better than the neighbors who own.

Rare to impossible? Nope. You're just charging too much. Give a good deal to the most qualified.

Now if my current LL had played hardball and raised my rent 700 f-ing dollars a month, I would have been happy to let him know that i've always had enough cash to buy a home in this neighborhood outright, and would be happy to pass the place along to the Manson family who just answered his Craigslisting.

Reminds me that I've always liked the song Helter Skelter. Paul McCartney inventing Heavy Metal. How cool is that? Might be a good anthem for the new Bastille Day.