Posts Tagged ‘property’

Mr. Obama’s Most Recent “2%” Sellout is his Worst Yet

Mr. Obama’s Most Recent “2%” Sellout is his Worst Yet

obamaobamaCourtesy of Michael Hudson

Now that President Obama is almost celebrating his willingness to renew the tax cuts enacted under George Bush for the super-rich ten years ago, it is time for Democrats to ask themselves how strongly they are willing to oppose an administration that looks increasingly like Bush-Cheney III. Is this what they expected by his promise of an end to partisan politics?

It is a reflection of how one-sided today’s class war has become that Warren Buffet has quipped that “his” side is winning without a real fight being waged. No gauntlet has been thrown down over the trial balloon that the president and his advisor David Axelrod have sent up over the past two weeks to extend the Bush tax cuts for the wealthiest 2% for “just” two more years. For all practical purposes the euphemism “two years” means forever – at least, long enough to let the super-rich siphon off enough more money to bankroll enough more Republicans to be elected to make the tax cuts permanent.

Mr. Obama seems to be campaigning for his own defeat! Thanks largely to the $13 trillion Wall Street bailout – while keeping the debt overhead in place for America’s “bottom 98%” – this happy 2% of the population now receives an estimated three quarters (~75%) of the returns to wealth (interest, dividends, rent and capital gains). this is nearly double what it received a generation ago – while the rest of the population has been squeezed, and foreclosure time has now arrived.

economy, obamaOne would not realize that the financial End Time is here from today’s non-confrontational White House happy-talk. Charles Baudelaire quipped that the devil wins at the point where he manages convince the world that he doesn’t exist. We might paraphrase this today by saying that the financial elites win the class war at the point where voters believe it doesn’t exist – and believe that Mr. Obama is trying to help the middle class, not reduce it to debt peonage and a generation of victimhood as the economy settles into debt deflation.

The first pretense is that “two years” will get us through the current debt-induced depression. The Republican plan is to make more Congressional and Senate gains in 2012 as Mr. Obama’s former supporters “vote with their backsides” and…
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Inflation in China Escalates – Miracle Expansion or Bubble to Burst?

Inflation in China Escalates – Miracle Expansion or Bubble to Burst?

A view of the centre of Shanghai August 23, 2010. With one arm, China is pouring cold water on property speculators. With the other, it is tossing a life buoy to the real estate sector via increased spending on affordable housing. REUTERS/Aly Song (CHINA - Tags: BUSINESS)

Courtesy of Mish 

The New York Times reports Inflation in China Is Rising at a Fast Pace

From street markets to corporate offices, consumers and executives alike in China are trying to cope with rising prices. The National Bureau of Statistics announced on Saturday that consumer prices in China were 3.5 percent higher compared with a year earlier, the largest increase in nearly two years.

To make matters worse, inflation over the short term also seems to be accelerating. A seasonally adjusted comparison of August prices to July prices showed that inflation was running at an annualized pace closer to 4.8 percent.

Prices are rising in China for reasons that many Americans or Europeans might envy. The economy is growing, stores are full and banks are lending lots of money, according to other statistics released by the government on Saturday.

Compared with August of last year, industrial production rose 13.9 percent last month, retail sales increased 18.4 percent, bank lending climbed 18.6 percent and fixed-asset investment surged 24 percent.

All four categories rose slightly more than economists had expected, in the latest sign of the Chinese economy’s strength even as recoveries seem to be flagging elsewhere.

But salaries for recent college graduates, at $300 to $500 a month in coastal areas, have actually declined in the last few years, even before adjusting for inflation. A rapid expansion of universities over the last decade has resulted in more young men and women with undergraduate degrees than companies are ready to hire, except at lower pay.

And as in many countries, retirees are among the most vulnerable to inflation. Ms. Lam said her own mother lived on a pension of just $150 a month.

Rising wages are putting pressure on companies to increase their prices. Mr. Dong, the sales manager at the Ningbo Deye Domestic Electrical Appliance Technology Company, said the company had to raise wages by 10 percent a year, while raw material costs were also climbing.

“It is impossible to transfer our cost increases entirely to our customers, because if we do so, they will all run away,” he said. “We are currently doing a study of our assembly line work processes to see where we can achieve greater efficiency.”

But as the powerful growth in fixed-asset investment last month showed, Chinese


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Get Small

Get Small

reformed broker, ant manCourtesy of Joshua M Brown, The Reformed Broker 

I had an interesting conversation with a pal the other day about the potential for continued and exacerbated deflation.

For some background, my friend is the opposite of me in his spending proclivities – his consumer footprint is probably twice the size of mine.  He’s got two parking garage spots in Manhattan, one by his apartment and the other by his office, both of which cost him $300-something a month.  You can extrapolate from there to get a sense of what kind of bills this kid is seeing each month.

Anyway, he’s in the commercial real estate brokerage biz which is basically Ground Zero for the deflationary spiral right now.  In the absence of businesses expanding and forming, prices per square foot are plummeting pretty much up and down NYC and around the clock.  No one’s bringing in new employees so taking more space is literally the furthest thing from their minds.  In a city that recently had eleventy-five hedge funds starting up each weekday that were willing pay whatever you quoted them for space, even the most sought-after buildings now sit at fractions of full capacity.  What’s worse, there is no burgeoning industry waiting in the wings to take up all the recently vacated hedgie offices – there are only so many law firms and bankruptcy specialists after all!

My friend the broker may be profligate, but he is also realistic and sees that, because of capacity slack, this could continue for quite some time.  His question is, short of moving to Tahiti with an easel and paint brushes, what can we do to counter the deleterious effects of this deflationary miasma?

My answer?  Not having lived through any periods of sustained deflation in my own lifetime (born in ’77), I gave him the only answer I could, one based on common sense.  I told him to Get Small.

Reducing the expenditure footprint allows you to preserve both cash and cash flow, two of the most valuable commodities of all when prices and returns on investment are falling all around us.  Many will be forced to puke up properties, investments, businesses and crown jewel assets in a deflationary environment – but kings are made on the other side.  The kings would be the counter-cyclically prepared, the guy showing up to the estate sale with an unencumbered bankroll.

We’re not…
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Money Illusion

Money Illusion

Courtesy of Tim at The Psy-Fi Blog 

Sleep Soundly

Top hat with money and wand

Money illusion is just about the most venerable of all of the behavioural biases that afflict people’s financial good sense. It was recognised back in the early part of the twentieth century, was an integral part of financial theories from thereon and spawned a range of measures that are more or usually less useful to us in everyday life.

Then economists decided that money illusion was … illusory. Which led to various predictable, albeit unpleasant, consequences such as believing “you can’t go wrong with property” or that storing cash in your mattress equates to sensible financial planning. Being poor is one thing, but not being able to get a good night’s sleep is entirely another …

Vanishing Trick

Money illusion is the trait that causes people to focus on the amount of money they possess rather than it’s worth to them. A hundred dollars a hundred years ago is obviously worth much more than a hundred dollars now: prices have inflated and the value of the hundred dollars is far less than it used to be. Measuring this exactly isn’t possible: what price would a businessman have paid for instant communication across the world a century ago compared to the peanuts we pay for the internet today?

In deciding to ignore the idea of money illusion economics was, for once, joining the mainstream, where most people happily ignore the fact that the value of the dollar in their pocket isn’t what it once was. This leads neatly to a world where there are more unemployed people than there should be, where central banks run around like puppy dogs chasing their tails trying to avoid the dreaded d-word and lots of people end up much, much poorer than they ought to be. As ever in monetary matters the world is stranger than we can possibly want to imagine.

Fisher’s Indexes

Despite the practical impossibility of real comparisons we know perfectly well that the value of a dollar or a pound, shekel, rouble or euro isn’t what it used to be. In fact, in the case of the euro it almost certainly isn’t what it was when you started reading this. This fact, however, doesn’t stop us from almost exclusively focussing on how much money we have today rather than what it can purchase for us:…
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Property Rights and Wrongs

Property Rights and Wrongs

magna cartaCourtesy of Tim at The Psy-Fi Blog

It Begins: The Magna Carta

In 1215, at Runneymede in England, King John set his seal upon the document known as Magna Carta and thus kicked off nearly a thousand years of property madness. The charter was the result of the King’s ruthless trampling over the rights of existing nobles and, extracted from him at the point of a sword, gave all freemen of England certain, inalienable rights.

One of these was the right not to be unlawfully deprived of their property and, such is the way of these things, this was to lead to the Anglo-Saxon obsession with housing which has been at the heart of so many recent financial debacles. It may be that “an Englishman’s home is his castle” but mistaking a heavily mortgaged property for a safe financial haven isn’t the cleverest bet you’ll ever make. Although it may still be better than investing in the stockmarket for most people.

Property Rights

At the heart of the Magna Carta were a number of provisions that echo down the ages:

"No free man shall be seized or imprisoned, or stripped of his rights or possessions, or outlawed or exiled, or deprived of his standing in any other way, nor will we proceed with force against him, or send others to do so, except by the lawful judgement of his equals or by the law of the land."

The document is, to be fair, rather a rambling read and at points gets oddly excited about making the King give back all the stuff he’d stolen from Wales including "the son of Llywelyn." Quite why King John had such a liking for the Welsh isn’t recorded, but they clearly weren’t happy with the attention. According to the charter he’d also acquired the sisters of the King of Scotland on his travels, so he seems to have been an inveterate Celtic kleptomaniac.

Although the charter enshrined a lot of rights, many of which are traceable into important future constitutional documents like the American Declaration of Independence, the English more or less observed it in the breech for a few hundred years. Kings may have nominally been as one with everyone else before God but in practice they had the biggest armies, the


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Zero Hedge

Walmart Transforming 160 Parking Lots Into Drive-In Movie Theaters

Courtesy of ZeroHedge View original post here.

In May, readers may recall we said social distancing would revive drive-in movie theaters in a post-corona world. And boy, were we right.  

A press release via Walmart on Wednesday (July 1) said, "Walmart is transforming 160 of its store parking lots into contact-f...



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ValueWalk

The "Next Netflix" Has Finally Revealed Itself

By Mauldin Economics. Originally published at ValueWalk.

A sleeping giant tech stock has awoken. It’s already handing out monster gains. And as I’ll show you today, it’s just getting warmed up.

Q2 2020 hedge fund letters, conferences and more

In fact, it won’t be long before this stock is mentioned in the same breath as hall-of-famers like Netflix (NFLX), Facebook (FB), and Google (GOOG). That’s right. The next great tech stock is growing up before our eyes.

I don’t say that lightly. Within a few years, this compan...



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Phil's Favorites

Coronavirus deaths and swelling public sector debt share a data-quality problem

 

Coronavirus deaths and swelling public sector debt share a data-quality problem

Different countries report coronavirus data differently. Shutterstock.com

Courtesy of Marion Boisseau-Sierra, Cambridge Judge Business School

Watching scientists, politicians and journalists struggle to compare national death rates from the coronavirus pandemic, I had an acute case of déjà vu. Though the virus may be novel, the confusion generated by inconsistent data standards is anything but. It’s something I&...



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Biotech/COVID-19

Coronavirus deaths and swelling public sector debt share a data-quality problem

 

Coronavirus deaths and swelling public sector debt share a data-quality problem

Different countries report coronavirus data differently. Shutterstock.com

Courtesy of Marion Boisseau-Sierra, Cambridge Judge Business School

Watching scientists, politicians and journalists struggle to compare national death rates from the coronavirus pandemic, I had an acute case of déjà vu. Though the virus may be novel, the confusion generated by inconsistent data standards is anything but. It’s something I&...



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Chart School

Golds quick price move increases the odds of a correction

Courtesy of Read the Ticker

Every market corrects, maybe profit taking, maybe of allowing those who missed out, to get in!


The current open interest on the gold contract looks to high after a very fast price move, it looks like 2008 may be repeating. A quick flushing out of the weak hands open interest may take place before a real advance in price takes place. The correction may be on the back of a wider sell off of risk assets (either before of after US elections) as all assets suffer contagion selling (just like 2008).

This blog view is a gold price correction of 10% to 20% range is a buying opportunity. Of course we may see  a very minor price correction but a long time correction, a price or time is correction is expected, we shall watch and...

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The Technical Traders

Wild Volatility Continues As US Markets Attempt To Establish New Trend

Courtesy of Technical Traders

We’ve continued to attempt to warn investors of the risks ahead for the US and global markets by generating these research posts and by providing very clear data supporting our conclusions.  Throughout the entire months of May and June, we’ve seen various economic data points report very mixed results – and in some cases, surprise numbers as a result of the deep economic collapse related to the COVID-19 virus event.  This research post should help to clear things up going forward for most traders/investors.

As technical traders, we attempt to digest these economic data factors into technical and price analysis while determining where and what ...



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Kimble Charting Solutions

Nasdaq 100 Relative Strength Testing 2000 Highs

Courtesy of Chris Kimble

The tech bubble didn’t end well. BUT it did tell us that the world was shifting into the technology age…

Since the Nasdaq 100 bottomed in 2002, the broader markets have turned over leadership to the technology sector.

This can be seen in today’s chart, highlighting the ratio of Nasdaq 100 to S&P 500 performance (on a “monthly” basis).

As you can see, the bars are in a rising bullish channel and have turned sharply higher since the 2018 stock market lows. This highlights the strength of the Nasdaq 100 and large-cap tech stocks.

...

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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

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Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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