patrick.net

HARM,

If you fly commercial, you will be strip-searched nowadays. So at least from the point of view of the government, you really are a "nobody".

@DennisN,

I'm not arguing that most Americans don't think that way, or that our Dear Leaders don't think that way. But, *I* don't think that way.

That’s a mighty elitist statement there

Worse yet, it is made by a non-elite... but anyway...

Do you think that having lots of money, regardless of how you acquired it or use it, automatically makes you “somebody”?

No, I can still find reasons to make him nobody. :)

Remember, I am a misanthropist. Assigning "worth" to people is not my specialty.

It would be elitist to say that renters cling to blogs because they are bitter. :)

Looks like H4 improved this week, Fed still has 548B (only minus 12B from last week) on hand. We are doing great, until the next Bear Stearns blowup that is.

Here is a good Paul O'Neil interview. I find most ex-Secretaries of Treasury to be quite candid, as long as they are no longer in the post.

http://www.bloomberg.com/avp/avp.htm?clipSRC=mms://media2.bloomberg.com/cache/vwyrSX9M2QsQ.asf

Looks like H4 improved this week, Fed still has 548B (only minus 12B from last week) on hand. We are doing great, until the next Bear Stearns blowup that is.

Here is a good Paul O’Neil interview. I find most ex-Secretaries of Treasury to be quite candid, as long as they are no longer in the post.
http://tinyurl.com/5vrmxb

We are doing great, until the next Bear Stearns blowup that is.

But how many black swans are still lurking?

People who bitch about the falling housing price are really people who are not financially sound enough to be an owner-occupier to begin with.

House that you live in is a consumption. Although I don't like Kiyosaki in general, I agree with him that whatever asset you live in that is NOT generating any cash flow is a consumption, not an asset. By the same token, the house in which I conduct my daily human activities is just my biggest item of consumption. Even if my house appreciates, to maintain the same standard of living in the same area, I cannot cash out my "gains" and buy another one, because another one will just cost the same!

So, buying a house for owner occupation is NOT an investment. It is a forced saving mechanism, an inflation hedge against rent, and a way to avoid moving every 2 or 3 years.

People who are upset about falling housing price are just those who were not financially established to own their home to begin with. If you are locked in a fixed-rate loan (which you can always refinance if the rate gets lower), and you need to live somewhere, who cares what the housing price is if it moves up or down? You are paying the same monthly expense anyway.

A house becomes an asset when you sell it in the future. People are basically moaning about the fall in value of that forward contract.

There's a post on Ticker which talks about how grain price hikes have forced American pig/beef ranchers to liquidate their inventory, which means much more inventory rushing to supermarket shelf in the short term causing lower beef price, but leading to potentially much higher meat price down the road.

I find it very intriguing because this was exactly what already happened in China. About 3 years ago, the increased feed price forced many pig ranchers (much smaller scale over there, 3-100 per ranch) to liquidate their inventory which further dipped the pork price. Pork to the Chinese is like beef to us. Then, a year ago, the whole country started to run out of pork (and there was a pig epidemic going around in certain inland parts), so pork price went up 80% in a matter of months. Now, you'd assume that all the ranchers went back to pig business, right? No, because pig breeders raised their price drastically just to keep in line with the price hike of pork, plus all the pig feed and medicine cost kept rising, so the pig ranchers cut back even further. We all know what pork price will be in China in the next 6 months.

The same situation will happen here. It is really interesting how economics principles are put in practice, many things turn out to be quite counter-intuitive.

It is really interesting how economics principles are put in practice, many things turn out to be quite counter-intuitive.

As I have stated many times, one can only analysis economics from a psychological/behavioral perspective.

History is the product of the actions and reactions of human emotion.

Rent is still going up in the BA and the interest rate for short to intermediate term saving is going down. Very bad for renters.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/04/17/BUHM107C0Q.DTL

How about the Dept. of Commerce?

http://www.commerce.gov/

or the Bureau of Industry-

http://www.bis.doc.gov/

or the Bureau of the Census-

http://www.census.gov/econ/census02/guide/INDSUMM.HTM

peng-

Not a problem if your savings is in gold or foreign currencies.

Industry census:

http://www.census.gov/prod/ec02/ec0253i07.pdf

Very bad for renters.

Not really. It's only kinda bad for renters and that's assuming they're idiots like me keeping everything in $. What's causing the low rates of course is actually so fuc*ing devastating for low equity "owners" it's hilarious to watch. Can't be easy for them, watching at least $5K a month in "equity" evaporate *and* be paying property taxes for the privilege.

OO,

So should we buy pork bellies futures ? ;-)

But seriously, there are SO few ways to invest in the food trend. That's why all those components of MOO are soaring. I am tired of investing in QQQQ stocks. But I am also scared of all these POT and MON.

I am seriously looking at RJA and DBA.

Looks like H4 improved this week, Fed still has 548B (only minus 12B from last week) on hand.
Sorry, have to be a counterbalance. Yeah, only minus $12B, we can sustain that for a whole year! But then again, Ben IS holding the line. :-)

I was searching for some historic data on the Fed site and came across this gem. Get his, when the country started running surpluses near the end of Pres. Clinton the First's reign, the Fed got antsy as Treasuries were declining as a means to manipulate (excuse me) maintain the Fed funds rate. The FOMC's historical reliance on purchases and sales of Treasury securities to implement monetary policy would be difficult to maintain if large budget surpluses and the associated steep reductions in Treasury debt were to continue. No worries, though, as the report explores other options. A related issue is that, if the Federal Reserve was a large holder of GSE obligations, some market participants might believe that the government would be even more inclined to support the GSEs in the event of financial problems. Such concerns might suggest that any role for GSE assets in System transactions should be limited and established only as part of a System program of diversification.
I also found this pretty interesting: since 1976, the size of the portfolio typically changed no more than about 1.5 percent each day, although the size changed as much as 15 percent on very rare occasions. Bear in mind that the Federal Reserve's portfolio has grown secularly with currency demand, although there is no guarantee that this growth will continue in a predictable way.

leading to potentially much higher meat price down the road

I just watched "King Corn" on PBS a couple of days ago. Basically of visual presentation of Michael Pollan's 'great corn conspiracy'. Does lead one to conclude that maybe higher meat prices down the road wouldn't be such a bad thing.

Hey Stuck, LXU is heat pumps crossed with POT -- what a combo?!

RJA has 5.73% live cattle adn 1.43% rice, both I believe will be big winners. But the problem is, he also has 20 something other agricultural products which may be in different cycle of the boom and bust.

If there is one thing you can count on the Wall Street, you can count on their "innovation" to come up with another Meat ETF for the retail customers.

The Original Bankster Says:
April 17th, 2008 at 2:46 pm
hey everyone,
"What is the best way to get accurate stats on revenue, etc. in the Real Estate Services sector?"

At your local library you can look up industry numbers. I've had to do that a few times for various school marketing projects. There is a system of classification that used to be called SIC and now has a new acronym but you can get some very good information on sales totals, market sizes etc for different industries.

EBGuy,

I don't know if you are referring to corn syrup (have not seen King Corn yet), but I have long suspected its detrimental health effect. I have tried very hard to stay away from processed food with corn syrup and it is HARD. Everything in this country has corn syrup in it, unless you eat fruit and vegetables directly, and cook your food from scratch.

I can almost hear the boredom. The DQ report releases today, EBGuy gave you all a link and what do we have ? Complete silence !

I miss the days when we would shred the DQ guys for their pathetic spins. Oh and long long ago, we were trying to point out how stupid their "median up" drama is. Now even price per sqft is also down.

Only thing going up is number of NODs and foreclosures.

It could have never happened HERE ! But it is and it will.

What we are seeing is that the press does not just report the facts -- they put their opinion or passion into it. The press was loving it when real estate was going through the roof. They contributed to the notion that real estate ALWAYS appreciates. We shouldn't have believed them on that, and we shouldn't believe them when it comes to a lot of other things. As this post so eloquently points out, people do not use critical thinking skills. They use "me" thinking skills.

I think the schadenfreude has pretty much run its course. The realtors, appraisers and brokers have been dispatched in disgrace; the MBS and CDO vintages are fermenting into bitter wine.

The most relevant current topic is bailouts. There is still plenty of outrage left for halfway-cripped banks and the "stupidity bonus" for our fellow taxpayers.

StuckinBA:

One way you can invest in the Food Bubble is to grow your own food. Some stuff like melons would do better if the weather wasn't so mild around here, but overall the climate here is backyard garden friendly. And you'd be surprised how you can wring out some yields without wasting lots of water. In San Jose, and probably other municipalities, you can keep an adequate number of producing hens without a permit.

There you are. Vegetables, fruit and protein. Invest the money that you saved on food into building up a position in an energy services stock.

As I have stated many times, one can only analysis economics from a psychological/behavioral perspective.

Oh Peter. What are we gonna do with you? lol

It's not zero sum, even if everyone really *thinks* it is.

Curious about some thoughts on zero sum. Assuming it is a zero sum game, is the only growth the amount of gold we pull out of the ground? I don't think cavemen cared too much, but it does seem to have been the measure of wealth in civilized history. Or if it is not gold is it the utilization of the environment? If this is the case does the zero sum total out in the future, meaning we consume resources making us poor in the future with the illusion of growth in the present?

I think I agree with Randy, if you think innovation and organization is what drives increases in standards of living. I think one can look at the history of production methods going from specialized trades/craftsmen to the totally unskilled but carefully designed modern day factory.

"As I have stated many times, one can only analysis economics from a psychological/behavioral perspective."

I don't tend to like hindsighted theory. You can pick any idea and go back to find perfect examples. I think for the most part economics is logical. The psychological/behavioral cases are the exceptions which is why they can be so volatile and, from an investment perspective, potentially lucrative to people who recognize them.

The news media is seriously degraded and corporate-owned. You can forget television as a source of any information worth knowing, for example.
Newspapers are in trouble, as advertising revenues decline. But other than select bloggers, where is the analytical piece on a story going to get done?
It takes resources and time, and we are the poorer and in danger because of it.

I am a believer in the Solow theory, which holds that long-run growth is defined solely by productivity increases. And productivity reduces to technological innovation, in the broad sense of the term. ie., the discovery of fire created real growth. The advent of agriculture created real growth. The cotton gin. The automobile. The computer. etc. All these things accreted in a fundamental manner so as to increase the total size of the economic system. Over time, the system gets bigger.

Someday, when we mine asteroids for metals, that will increase growth. And then, finally, no one will be able to argue for the inane "gold standard" anymore because gold will be infinitely available, and terribly inflationary.

Wow. Does this qualify as a day of reckoning? I remember finding this site back in mid 2004 during the Dark Times (TM) wondering if I was the only one who thought something was rotten (and not just in Denmark). How the worm turns...albeit very slowly and painfully for all to enjoy!

Sorry this blog was down for a bit. Someone was mucking with the configuration. Probably a realtor...

It’s not zero sum, even if everyone really *thinks* it is.

It depends upon your definition of growth. (And what your definition of the world 'is' is.)

If you measure by the amount of stuff we have (like iPods), the system is NOT zero-sum.

If you measure by our achievement, we need to ask what that means. To me, humanity is but a constant game of people exploiting people. The form of the game may evolve, the background music may change, but the objective stays the same.

Are you guys following the mother of all short squeezes in the market today? Since it is a win-win game for the banks, they'd always go up like bay area homes. Also, FRE is now the new dumping ground for 'conforming jumbo' loans as of yesterday's news.

Yes. My puts are hurtin.

Are you guys following the mother of all short squeezes in the market today?

The Gold sell-off appears to have started at 5am EDT.

http://quotes.ino.com/chart/?s=CBOT_ZG.M08.E&v=s

Yes. My puts are hurtin.

You are speculating with Puts? I am shocked!