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Many Sellers Ended Up Accepting Offers Below Prices Dreamed Up During The Height Of The Frenzy

A weekend topic starting with two reports from the Wall Street Journal. “Builders are expected to complete some 371,000 new apartments in 2020, compared to 247,000 in 2019 and 119,000 in 2010, according to RealPage. The problem is that many of the new apartments will be too expensive for lower- and middle-class families. Bernie Sanders blames this on ‘corrupt real estate developers’ who are ‘gentrifying neighborhoods’ and replacing affordable homes with ‘fancy condominiums and hotels that only the very rich can afford.’ Elizabeth Warren says ‘developers can usually turn bigger profits by building fancier new units targeted at higher-income families rather than units targeted at lower-income families.'”

“Their solution is more government control of the rental market. But what if that is already the main problem?”

“A new state rule preventing real-estate firms from charging broker fees on apartment rentals is causing chaos and sudden panic in the industry. The Real Estate Board of New York and the New York State Association of Realtors, two large industry groups for brokers in the state, said Friday that they would sue the New York Department of State for ‘usurp[ing] its role by engaging in improper rulemaking…resulting in losses for brokers and landlords alike,’ the groups said in a joint statement.”

“‘There’s lots of little firms, and I don’t know how they’re going to do the business,’ said Donna Olshan, founder of Olshan Properties. ‘A lot of these brokers don’t make much more than teachers.'”

From Market Watch on New York. “Community banks that financed swaths of New York City’s rent-regulated apartment buildings in recent years now face questions about potential fallout to their loan portfolios seven months after state legislators overhauled tenant-protection regulations. Christopher Maher, OceanFirst’s president, pointed to a ‘giant’ jump in capitalization rates across New York’s rent-regulated apartments to as high as 6%, on the bank’s earnings call. Cap rates are a popular gauge for returns in real estate, after considering a property’s value and expected rents. They plunged to the sub-4% range on Manhattan buildings as property prices hit new records, but tend to climb when risks rise.”

“‘This is not a situation where there should be panic over the asset class,’ Maher said in a follow up call with MarketWatch. ‘You will see some defaults,’ he said. ‘But I think you’re going to see it more in non-regulated lenders, the shadow-banking market. I don’t expect you’re going to see a significant problem in bank balance sheets.'”

“Last year, the value of apartment transactions in Manhattan dropped by 41% to $5 billion from a year earlier, according to Real Capital Analytic data, while the city’s other boroughs saw a 47% plunge to $3.4 billion over the same period. While those figures don’t separate for individual sales of rent-regulated buildings, brokers told MarketWatch that investment activity in the sector has cooled significantly in recent months and that prices likely are 25% to 30% lower.”

“‘The apartment sector fundamentals have been stellar for most of this cycle,’ said Yardi’s Paul Fiorilla, in an interview with MarketWatch. But in New York the concern is that property expenses, including upkeep and repairs at rent-regulated buildings, could outpace rent growth under the new rules, and drag down the appeal and prices of real estate in the process. ‘If you have to sell for less than a property was worth a short time ago, that’s not something a lot of people are eager to do,’ he said.”

The San Francisco Chronicle in California. “New development in Oakland is stabilizing rents and may start driving rental costs down, Oakland Mayor Libby Schaaf said in a State of the City address Friday evening that packed the Oakland Museum. As protesters held signs that read ‘Stop all evictions’ and ‘Housing is a human right’ outside the museum, Schaaf spoke of the homeless crisis, renter protections, anti-eviction efforts and safety on city streets. The mayor said the city exceeded its housing goal of adding 17,000 units by 2024. The city has added 22,000 new units.”

“The new housing units are starting to stabilize rents in Oakland, she added. ‘Rents have stopped going up and many predict next year, they will start going down,’ Schaaf said. ‘Rents are at an expensive place in Oakland, where the average worker cannot afford them. We have much work to do.'”

From Socket Site in California. “As we outlined back in the fourth quarter of 2017: ‘the contentious plans for a five-story building with 28 condos over 6,300 square feet of new retail space and a 19-car garage to rise upon the Oil Changer site at 198 Valencia Street have been approved and newly rendered below. But rather than preparing to break ground, the 198 Valencia Street site and plans are now on the market with a $9.25 million price tag.’ Permits for the development were subsequently approved and issued, but the project has yet to break ground. And with that in mind, the entitled parcel is now back on the market with a reduced $6.95 million list price.”

From The Real Deal on Florida. “Five years after completing 321 Ocean, developer Aria Development Group and its contractors are being accused of widespread faulty construction at the South Beach luxury boutique condominium. The 321 Ocean Condominium Association sued Aria’s development entity 321 Ocean Drive LLC, project architect Revuelta Architecture International, general contractor Coastal Construction and 16 companies involved in building the 24-unit beachfront complex in Miami Beach’s South-of-Fifth neighborhood.”

“Filed last month, it’s the latest lawsuit involving allegations of massive construction defects at a condo building completed during Miami’s most recent development boom, as such suits have become increasingly common.”

“After taking control of the building, 321 Ocean condo association discovered construction defects in the common areas, individual units, the roofs of the complex’s two buildings, the garage and the structural elements, the complaint alleges. Attached to the lawsuit is an 11-page itemized list of all the defects, which run the gamut. For instance, there are cracks in the floor slabs of the service areas of the east tower, as well as cracks to the concrete slab in some stairwells. Stucco was improperly applied on the balconies of all the units. There are also cracks in the stucco of the garage entrance and the roof of the east tower, according to the list. And in more than a dozen units, sliding glass doors are not aligned with the jambs, the suit alleges.”

From Curbed Boston in Massachusetts. “Once upon a time, bidding wars were common in the Boston-area housing market. Prospective buyers vied to one up each other at crowded open houses, leading to closing prices well over the originals that buyers and their brokers had put out there. Tips for winning bidding wars abounded. (Come with cash seemed to top most lists.) That’s all in the past. Or at least it certainly looks like it.”

“‘The housing market took a breather in 2019, after years of red-hot sellers’ markets,’ Zillow economist Jeff Tucker said. ‘Many sellers were caught off-guard by the changing conditions, and ended up accepting offers at or below list prices that were dreamed up during the height of the frenzy.'”

The Post and Courier on South Carolina. “More than 3,000 additional student beds in private dormitories are coming to Columbia, where numerous new student complexes already have changed the flavor of the city. But, for some, enough is enough. ‘I think we are past the saturation point,’ Columbia City Councilman Howard Duvall said. ‘I think we have overbuilt for student housing.'”

“Duvall worries that, as newer private dorms acquire residents from other complexes, the city will struggle to find new uses for the structures that fall out of favor, because of the designs, which frequently have four bedrooms sharing one common area. ‘These buildings will be hard to repurpose to other things because of their design,’ Duvall said.”

This Post Has 145 Comments
  1. ‘pointed to a ‘giant’ jump in capitalization rates across New York’s rent-regulated apartments to as high as 6%. They plunged to the sub-4% range on Manhattan buildings as property prices hit new records, but tend to climb when risks rise’

    Oh dear…

    ‘This is not a situation where there should be panic over the asset class’

    Chris, I appreciate your concern, but I’m fine, really.

    1. ‘brokers told MarketWatch that investment activity in the sector has cooled significantly in recent months and that prices likely are 25% to 30% lower’

      Is that a lot?

      ‘The apartment sector fundamentals have been stellar for most of this cycle….If you have to sell for less than a property was worth a short time ago, that’s not something a lot of people are eager to do’

      1. “A lot of these brokers don’t make much more than teachers “ . OMG does that sum up so much of what’s wrong with our world right now.

  2. “The median sale price of a metro Denver home was $420,000 last month, up less than 1 percent over the previous month and about 5.8 percent over January of 2019, according to the latest monthly market trends report from the Denver Metro Association of Realtors.

    Over the last decade, while median prices have kept rising, the pace has slowed. The real estate group recorded a 9.4 percent increase in the median single-family home price from January of 2016 to January of 2017 and a 10.1 percent increase from 2017 to 2018. From 2018 to last year increase was just 3 percent.”

    https://denverite.com/2020/02/05/metro-median-home-sale-prices-have-kept-rising-but-the-pace-has-slowed/

    It’s a good thing the median household income in Denver is $140,000 to sustain these purchase prices, right?

    Oh wait, it isn’t. It’s less than $70,000.

    Hope nobody who only put 3% down overpaid in this market, which REALTOR assures us is unpossible.

  3. “‘There’s lots of little firms, and I don’t know how they’re going to do the business,’ said Donna Olshan, founder of Olshan Properties. ‘A lot of these brokers don’t make much more than teachers.’”

    The median work earnings for college graduates residing in NYC is around $60,000. New York City teachers start at that, with summers off. And those retiring are doing so at age 55 after working 25 years.

    NYC police officers retire after 20 years of work.

    Etc.

    1. If you think teachers-police pensions etc. (that they pay a significant portion of their income towards 8-11% and do not qualify for Social Security) etc. are a significant portion of the economic inequality issues are the problem you really need to examine corporate welfare a bit more closely. Bring back defined pensions for private sector workers in addition to 401ks/IRAs instead of turning wage earners against each other and society would be much better financially and health-wise in many respects. Hard working people who spend an entire career in all private/public sector jobs deserve some guaranteed retirement security.

      1. “Hard working people who spend an entire career in all private/public sector jobs deserve some guaranteed retirement security.”

        Agreed! A law should be passed that mandates all these cons that choose a “career” as a realtor, broker, or loan jockey get reverse pensions that help pay to the ones that actually deserve them.

      2. The guaranteed retirement security for Feds civilians will be somewhere between $25K and $30K, depending on how long you’re there and what your salary was (very little overtime). Then there’s SS or TSP (equiv of a 401K) and comes out of your paycheck. I don’t think anyone would object to state and local employees getting something similar. But when cops overtime-stuff and walk away with $150K+/year, I can see where the ruckus is.

        1. But when cops overtime-stuff and walk away with $150K+/year, I can see where the ruckus is.”

          CA the ruckus state. local city wants a new bond passed to pay for schools, this is a third bond for schools two already passed a few years ago. If passed will add about 200 to yearly property tax for a total of about 600 a year for the median priced home.
          So wheres the old tax revenue stream ? it doesn’t go bad or go away. pensions probably ? Who knows?

          1. Tustin? Lol. Nextdoor HATES the bond. Posters all saying time for the district to live within its mesns.

      3. “If you think teachers-police pensions etc. (that they pay a significant portion of their income towards 8-11% and do not qualify for Social Security) etc.”

        In NYC they qualify for Social Security. They were supposed to pay 3 percent into their pensions, but this was ended after they worked ten years. In some cases, the money they had paid in was refunded with interest.

        Imagine a continuum. On the far end of one side, anti-tax corporate welfare types are cheating public employees. On the other side, public employees and contractors are cheating the general public. That’s where NYC is. Off by itself, with nowhere else even close.

  4. Denver has a serious homeless problem:

    “When city officials closed off stretches along and near Sand Creek in northeast Denver this week to clean up debris, food, and human and animal waste, a top concern was the health and safety of people who have made the area home with tents and other forms of shelter.

    But the temporary and indefinite shutdown left people experiencing homelessness searching for new places to live, stressing their mental and physical health in a week of snow and freezing temperatures.”

    https://denverite.com/2020/02/06/denver-health-officials-send-people-experiencing-homelessness-scrambling-after-clearing-sand-creek/

    This is not a nice part of the country to be homeless in during winter. May I suggest California, they’re the national leader of creating more homeless, you’ll feel right at home there.

    1. California leads in homeless and illegals. Just when you think the Democrats cannot get any more insane on the issue of illegals, comes a bill which not only does away with automatically deported illegals with serious criminal convictions, comes a bill which does away with that and spends tax dollars to find and bring back to America previously deported felons:
      https://www.foxnews.com/opinion/tucker-carlson-criminals-would-be-protected-from-deportation-under-bill-aoc-and-other-house-democrats-back

      1. It’s time we start arresting the politicians who enact these insane bills/laws, they are clearly trying to bring in just voters at any cost to the legal tax payers, who for to dumb to see whats happening. I’m surprised we havent seen a politician gunned down, just a matter of time.

          1. “This weekend, I’m not watching the news, I’m turning it off. I’m going to get a massage and I’m going to drink,”

            Now does she have a regular masseuse or does she call a place where they play rock-paper-scissors to see who has to go give Joy a massage?

          1. Yep, Scalise is tough as nails and not so stupid as to blame an inanimate object for the actions of a lunatic, unlike the vegetable’s cuck-hubby.

          2. And don’t forget that Congressman who was killed by the Jim Jones koolaid krew. And of course several Presidents.

    1. People should really use this cite as a resource and it does discuss the various ways to calculate the mortality rate during an ongoing epidemic including the way some on this board want to calculate it, but I will point out with their way, the mortality rate in China was more than 50% when they started and now would be around 23% while the other methodology was just over 2% and time has already shown that to be more accurate and far less alarming. Finally a key quote from the very informative website:
      “Importantly, in emerging viral infection outbreaks the case-fatality ratio is often overestimated in the early stages because case detection is highly biased towards the more severe cases.
      As further data on the spectrum of mild or asymptomatic infection becomes available, one case of which was documented by Chan and colleagues, the case-fatality ratio is likely to decrease.
      Nevertheless, the 1918 influenza pandemic is estimated to have had a case-fatality ratio of less than 5% but had an enormous impact due to widespread transmission, so there is no room for complacency.”

      1. From the site you linked:

        “An alternative method, which is also discussed in the American Journal of Epidemiology study cited previously, would be to use the formula:

        CFR = deaths / (deaths + recovered)

        which, using the latest data available, would be equal to:

        724 / (724 + 2,410) = 23% CFR

        Finally, we shall remember that while the 2003 SARS epidemic was still ongoing, the World Health Organization (WHO) reported a fatality rate of 4% (or as low as 3%), whereas the final case fatality rate ended up being 9.6%.”

      2. “…the other methodology was just over 2% and time has already shown that to be more accurate and far less alarming.”

        Is this the Chinese Communist Party calculation?

        1. Novel Coronavirus Mortality Rate, as discussed by the National Health Commission (NHC) of China

          Asked at a press conference on February 4 what the current mortality rate (or case fatality rate, CFR) is, an official with China NHS said that [7]:

          The formula they are using is: cumulative current total deaths / current confirmed cases. So, as of 24:00 on Feb. 3, the formula used was 425/20,438.
          Based on this figure, the national mortality rate is 2.1% of confirmed cases.

        1. Here’s one reason why your estimates are downward biased:

          “CFR = deaths at day.x / cases at day.x-P”

          With a median age from disease onset until death of P = 14 days, it’s way too early to estimate the CFR for areas where the novel coronavirus recently arrived.

          The other problem is that you are making the same calculation error as the CCP.

          1. Swiss Medical Weekly: 2019-Novel Coronavirus (2019-nCoV): estimating the case fatality rate – a word of caution

            “At present, it is tempting to estimate the case fatality rate by dividing the number of known deaths by the number of confirmed cases. The resulting number, however, does not represent the true case fatality rate and might be off by orders of magnitude. Diagnosis of viral infection will precede recovery or death by days to weeks and the number of deaths should therefore be compared to the past case counts – accounting for this delay increasing the estimate of the case fatality rate. On the other hand, cases in official statistics are likely a severe underestimate of the total – accounting for this underestimate will decrease the case fatality rate. The time between diagnosis and death/recovery and the degree of underreporting will vary over time as well as between cities and countries. A precise estimate of the case fatality rate is therefore impossible at present. Figure 1 illustrates how these uncertainties manifest themselves using currently available data.” (emphasis added)

      1. Maybe it needs to entered under the globalists got to globe. H1N1 originated in Mexico. It was a classic example why our border with Mexico needed to be regulated. This undercounting occurred under Obama when there was a strong push to legalize illegals. Was the CDC under political pressure to undercount the danger? We will never know because the MSM does not report anything that is against the narrative that globalism is great.

        https://virologyj.biomedcentral.com/articles/10.1186/1743-422X-6-207

    2. Which of the recommended approaches on the site you linked are you using?

      “The correct formula, therefore, would appear to be:

      CFR = deaths at day.x / cases at day.x-P
      (where P = average period from case confirmation to death)

      This would constitute a fair attempt to use values for cases and deaths belonging to the same group of patients.

      One issue can be that of determining whether there is enough data to estimate P with any precision, but it is certainly not P = 0 (what is implicitly used when applying the formula current deaths / current cases to determine CFR during an ongoing outbreak).

      An alternative method, which is also discussed in the American Journal of Epidemiology study cited previously, would be to use the formula:

      CFR = deaths / (deaths + recovered)”

      1. Using current data off the John Hopkins University coronavirus map site:

        Estimated CFR =
        deaths / (deaths + recovered) =
        725/(725+2,394) =23.2%.

        This CFR estimate is dropping as the disease outbreak progresses, but it doesn’t seem likely to settle out at 2% until after a cure is developed, at soonest.

        Have you considered that perhaps the 2% number is used to mollify the sheeple?

        1. Have you considered that the numbers you slave over with maths are fictitious?

          As an old Bastard of Industry once said to me ahead of a BOD meeting: “I’ll make up the numbers, you do the math to support them.”

          1. “I’ll make up the numbers, you do the math to support them.”

            Wow that’s a great line and likely used by every realtor to the appraiser as they slip them an envelope.

          2. That was the story in climate research beginning around 2000 – got out a few years later thankfully.

            Now tofu munchers with degrees in basket weaving call people like me a “denier”, lol.

        2. “Have you considered that perhaps the 2% number is used to mollify the sheeple?”

          Have you considered that most of the deaths in China are because many of the people are receiving treatment no better than they would have received in 1918? The virus may be hard to treat but many seem to have died of secondary infections which should have been easily treated. Thus, the reason that the death rate outside of China is at .6%.

          1. Oh you are very wrong about that. This is not about secondary infections, this is about a massive shutdown of the lungs as virus attacks it.

      2. None of us on this board has enough information to use the ideal methodology. However, it is and always was clear that using deaths vs. recovered was incorrect and would be widely off. The methodology of using death vs. cases had problems but was more likely to be closer to the correct number since history has shown us that the most serious cases get reported first and they result in much higher death rates. Unless you have blatant fraud as you do in China virtually all deaths will be counted once the existence of a virus is known.
        You have many people ill with this virus that have symptoms more minor than a common cold. It is very easy for them to fly under the radar particularly at the beginning of the epidemic. Thus, there was no reason for us to seriously question the initial range used, which was 2 to 4% death rate with the understanding that range would probably prove high based on the experience the CDC had with other viruses. The projection of 40 to 50% death rates was just alarmist nonsense.

        1. As I explained in a post a couple of weeks ago, both the 2% and the 50% estimates are implausible extremes, with one assuming complete recovery of confirmed cases and the other assuming deaths of unresolved cases in equal proportion to the resolved cases (this was 50% a couple of weeks ago). The eventual rate is clearly eother going to settle out in between, or could stay at 2% if all the currently unresolved cases survived.

    3. I’m not as invested in the death rate as others here. What I want to know is: How contagious is this on surfaces? Is it true that ethnic Chinese are more susceptible? Why are Chinese dropping like flies, yet non-Chinese are recovering fast and not really spreading it? Are ethnic Chinese really more susceptible? If the death rate is so low, then why are there stories coming out of China of massive quarantines and people being dragged away?

      Death rate is a function of promptness of medical care, underlying conditions, and number of test kits.

      It wouldn’t surprise me if that young doctor died from the virus only because he was tortured first.

      And I have even more reason to explain why cruises are a bad idea.

      1. “Why are Chinese dropping like flies, yet non-Chinese are recovering fast and not really spreading it?”

        The death rate in places where the disease recently arrived are not comparable to other places where the disease arrived months ago.

        1. It is no longer recently arrived in the West and most of those people who are ill became ill within a few days of arriving so they may have been incubating the virus for close to two weeks. Despite this only two dead and five seriously ill. The five are all going to have to die, just to get the mortality rate up to 2%. Give it up you were wrong and move on.

          1. You are clearly a true believer in Inference by the Law of Small Numbers.

            WHO KNOWS
            It’s too early to say how deadly the China coronavirus is
            February 7, 2020
            By Mary Hui
            Reporter

            People everywhere are pronouncing with confidence that China’s coronavirus outbreak is either: much less severe than SARS; less deadly than the flu (or at least no worse than it), or is comparable to the cold. Many news outlets, meanwhile, have reported that the novel coronavirus has a fatality rate of about 2%—apparently much lower than SARS or MERs.

            They may be right. But they may also be completely wrong. The truth is, it’s far too early to say with any certainty how deadly the China coronavirus is. And if history is any guide, we would do well to remember that during the 2003 SARS epidemic, news outlets and even the World Health Organization (WHO) initially reported fatality rates that were far lower (“only about 3%,” for example) than the ultimate overall rate of 9.6%.

            The reality is that it will take careful studies over the coming months, with good case ascertainment or lab testing, to say whether 2% is about right, too low, or too high,” said Arthur Reingold, division head of epidemiology and biostatistics at the University of California, Berkeley.

      2. Are ethnic Chinese really more susceptible?

        I want to know that too. I have heard a conspiracy theory that actually makes sense why the Chinese would develop a virus to just target Han Chinese, the reason why they would not want it to be too deadly is obvious. But I really want to wait until there is a least some evidence that this virus seems to be designed to make Han Chinese ill.

        1. Chinese ill.

          They’ve got one thing we don’t: No medicine, no heat, no hot water, no toilet. OK, That’s more than one thing.

          1. PB a few weeks ago you were talking about the 30 to 40 percent range are you at least willing to man up and say that was way too pessimistic.

          2. You should man up and admit that (1) we don’t really know what the CFR is at this point, given limited data, and (2) whatever it is, 2% will prove to be a low estimate.

        2. “Are ethnic Chinese really more susceptible?”

          You’re supposed to love your dog, go for walks, throw the frizby, etc., not eat it.

          1. You are also not supposed to take home the lab animals and eat them.

            How many times were we told by Adan that the Chinese were the absolute smartest people on earth?

        3. It has to do with how the virus attack host cells, there is reason to posit increased susceptibility in Asians especially males

  5. Archive dot is link to Bloomberg article (unreadable with adblock) published yesterday titled Team Clinton Hits Sanders Ahead of New Hampshire Primary:

    http://archive.is/oxyq7

    Long read from Current Affairs magazine published 3/29/2019 confirms Mayor Pete is a total phony who stands for nothing and believes nothing beyond his own millennial sense of entitlement:

    https://www.currentaffairs.org/2019/03/all-about-pete/

    I donated more money to Bernie yesterday, because in case you forgot, I have so much money left after “throwing money away on rent” every month that I don’t know where to throw it.

      1. God forbid someone should really try to figure out what people want and then run a political party based on those wants and needs

        If you oppose globalism and multiculturalism, or having your country flooded with refugees from neocon “regime change” fiascos, or letting unaccountable faceless elites decide what’s best for you, you are, ipso facto, “far right” or a white nationalist according to our MSM border collies.

  6. “Archive dot is link to Bloomberg article (unreadable with adblock) published yesterday titled Team Clinton Hits Sanders Ahead of New Hampshire Primary:”

    The left is not surprised by that attack. However, the Bernie bros and gals are going to be devastated when Obama opens up on Bernie. It will not happen if Bernie fades badly. but if he continues to do very well, “Barry” will attack him and do the globalists’ bidding, it is not inexpensive to keep up his properties.

    1. Globalists gonna globe.

      Their failed ideology needs to be taken out behind the barn and shot, like a horse with a broken leg.

      I voted for Trump in 2016, and, as I love telling millennials I know, have no regrets, and no apologies for it. But three years in, his presidency has been a disappointment in many regards. If we’re going to have trillion dollar annual deficits to infinity (per recent CBO projections) it would be nice to have something like affordable health care (for U.S. citizens only) instead of flushing it all down the black hole of the Pentagon.

      1. The Dems Platform overall is la la Land. I’m just hearing a lot of pandering to certain groups in terms of free stuff. This isn’t equity to pick winners and losers.

        The Communist Bernie Sanders would turn this Nation into a living hell. Big Government is never the solution . I’m not saying that the Globalist and 1% don’t need to be put back in their place, but Communist solutions don’t work. It’s really a con job for Government to take over everything. It would be hell ,but Bernie Supporters think it sounds so equitible.

        It’s just shocking that as a Nation that the real problems and viable solutions aren’t even discussed. Really dangerous times right now.

        1. 401 and I are not rooting for a Bernie Sanders to win in the general election. I am hoping for a situation where the globalists will have to chose between Bernie and Trump. Honestly, I think Trump is doing more damage to their agenda than Bernie would. However, I do not think the globalists will allow Bernie to win because then if the economy collapses under him, the public will then want an anti-globalist Republican even more since Trump has succeeded. They wanted to discredit Trump and then get him out of office. With Bernie running they may stop trying. They wanted to collapse the economy by raising interest rates but then stopped when they were causing more damage to the world economy than the US economy, This was causing more pushback against globalism in other countries. Then, they seem to want to push him into a war with North Korea, Iran or Turkey but he did not pull the trigger causing people like Bolton to go ballistic. Neither of the two things that the globalists said would happen has happened, no new war and no collapse of the economy. The country has peace and prosperity and the promise of even better times in the future. Even the trade war with China is going well and we are making treaties such as NAFTA better. In short, the enemy of my enemy is my friend. Bernie by messing up the handpicked candidates of the globalists is helping to get Trump re-elected.

          1. As a former Republican turned independent, but generally libertarian-conservative in my political views, it was incredibly satisfying to watch Trump beat out 16 hollow man Establishment GOP candidates – each and every one a globalist stooge and Wall Street errand boy – to win the GOP nomination and go on to be elected. That was a huge middle finger to the Republicrat duopoly and its corporate pimps. Now the corrupt crony-capitalist Democrat Establishment is facing a similar upstart challenge from the Left. I despise the Left, but the root of all evil in this country is globalism and the corporate state. So if I can cross the line and help monkey wrench the globalists’ attempts to anoint hand-picked stooges, I will happily hold my nose and chip in to support Bernie Sanders’ insurgent campaign.

          2. A fratricidal civil war between the progressive and corporate wings of the Democratic Party would be a win-win for America. This is like the Iran-Iraq War. Let ’em both lose.

          3. It’s transparently obvious that Trump supporters want Bernie Sanders. Not just because he is a socialist disrupter, but also because Trump can easily beat him.

          4. are not rooting for a Bernie Sanders ??
            Yes you are…
            How about using a little more of the quote. Then people would know that I said 401 and I are not rooting for Bernie Sanders to win the general election. We are rooting for him to win the nomination of the Democrats. Your boy Bloomberg needs to step it up, he is not moving up while Biden collapses as he thought, Mayor Pete is filling that hole.

          5. DNC to self destruct ??

            You meant RNC right…Because that’s exactly what you are getting…See 2018 elections….Check how many republicans are retiring since then….

          6. Ok, so are you saying the Globalist want a Biden or a Bloomberg.

            It’s just really weird that the Dems party has all these radicals. I just think the Commie Party is making a big power play right now, but they have been taking over the Dems party for a long time now.

          7. I kind of agree with Boo Randy but not for exactly the same reasons. I think both Republicans and Democrats are Globalists. This means that same wages for same work worldwide. Good goal but when wages in India and China are 25 cents per hour, there will be a growing homeless population in the US as Republican leaning corporations and investors gobble up housing and have to charge more for rents than is affordable to wage earners making too little. Automation is also driving down wages.

            A couple of observations:

            1) Obama ran on “Hope and Change” while private pensions and interest rates for savers were demolished. Other than healthcare, Obama failed to help the lower income population. If you had a 401K, you are doing well at the moment but less than half of the US population has a 401K or any stock investments. Many were wiped out in 2008.

            2) Trump ran on “Drain The Swamp” but refilled the swamp with his own worse swamp-like creatures. Many are now in jail, and even the ones he picked are quitting the swamp in droves. Trump’s tax cuts benefited the top 10% but all of my middle class co-workers did not see any benefit and most now pay more in taxes. The tax cut likely benefited the poor but the exemptions were removed so they are likely breaking even also. Trump vowed to destroy ObamaCare and replace it. Like most liars, he destroyed Obamacare but now we hear crickets about replacing it. While Trump claims this is the best economy ever, he is driving up the deficit at a rate higher than any Democrat in history. I don’t see how any sane Republican conservative can defend this. These Trumpers just ignore their own values and really should see a psychologist for their mental illness.

            The lower 50+% were betrayed first by Obama and then more by Trump.

            The majority of voters are looking for drastic change. They tried Obama and then Trump. Both did not help. Bernie is a radical like FDR was in the 1930’s.

            I think Bernie or Warren have a good chance of winning since the majority of voters want change. They tried Obama and it didn’t help. Then they tried Trump and homelessness and the deficit keep growing.

            Bernie or Warren will win if these 50+% of the losers show up to vote.

      2. I voted for him, too. And if it were he vs. Clinton again, I’d do it again. Because, fawk Crooked Hillary. Having said that, I will not vote for him this coming election. He’s been, in my opinion, a bitter disappointment. He called the stock market a “big, fat, ugly bubble” and criticized Yellen, then turned around and celebrated it as some grand achievement once he became president. Even worse, he bullied the FED into rate cuts which is, in my opinion, threatening to destroy this country and its currency, not to mention the financial whooping that it’s putting on the average household budget.

        Just recently, in a speech, he was publicly telling Jamie Dimon he should thank him for all of the good fortune bestowed upon the banks. Further, in his SOTU speech, he celebrated the stock market’s rocketing values as if that’s the real economy. It’s not. Over half of Americans don’t even have any exposure to the stock market, and that’s the half of America which is in real trouble.

        Because I will not vote for him does not mean I will vote for Bernie or some socialist. No. I might just sit out the first election in my life.

        1. PS – also not happy with his escalations in the middle east. He was against frivolous spending and all of the folly that has been our middle east policies. Yet, he’s hanging around over there, poking the hornet’s nest just like Obama. It seems that the war machine has captured him.

        2. The U.S. economy is being gamed-up to pay for Medicaid, Medicare, Social Security and the Middle-East wars in the manner that Bernie Madoff ran his investment firm. Viewed through the lens of an accountant, printing money and turning it into over-priced college degrees, houses or diesel pick-up trucks is foolish, but these items appear as an eventual benefit on the other side of the ledger; someone is attempting to pay for them. However, paying social security disability for the chronic unemployed or funding endless religious wars is just an expense, i.e., the money is gone. And the beneficiaries are not helping to ameliorate that expense.

  7. Crain’s Business Detroit, February 6, 2020

    • Joe Barbat buys troubled downtown Birmingham development, plans apartments
    • Developer paid $6.75 million for The Forefront on South Old Woodward Avenue
    • Construction on 30 new apartments expected to be complete next year

    The eight unfinished units of The Forefront development at 400 S. Old Woodward Ave. will be converted into 30 apartments. A failed condominium development in downtown Birmingham is now slated to be turned into one-bedroom apartments on South Old Woodward Avenue.

    Developer Joe Barbat paid $6.75 million for the eight unfinished units of The Forefront development at 400 S. Old Woodward Ave. late last month, according to CoStar Group Inc., a Washington, D.C.-based real estate information service. Barbat said on Thursday afternoon that he plans to convert that unfinished space into 30 apartments by the time it opens next year. He declined to reveal the development cost. His company, West Bloomfield Township–based Barbat Holdings LLC, would make its new headquarters in the commercial space in the building, which is also occupied by M.A. Engineering, Barbat said.

    Thomas Roberts Architects, based in Wyandotte, is working on the redevelopment.

    Barbat is the owner of Houze Living LLC, which has residential redevelopment and development projects in Detroit and Ann Arbor.

    The Forefront was developed by Joey Jonna of Jonna Luxury Homes. Jonna did not return a text message seeking comment. He reportedly owed $2.4 million on a $7.3 million construction loan that he defaulted on, plus another $80,000 in property taxes, the Detroit Free Press reported in May. The project had been in search of a buyer for nearly a year.

    According to marketing materials from Farmington Hills-based M. Shapiro Real Estate Group, the court-appointed receiver, there were eight partially built condos up for sale in the building. The units are on the second floor (five units) and third floor (three units) with a total square footage of 27,363 square feet (3,420 square feet on average).

    M. Shapiro Real Estate and Bailey Schmidt & Associates worked on the sale, according to CoStar. Two of the 10 condominiums in the development sold, and the commercial space is occupied.

    When it was announced in June 2014, the project was expected to cost $20 million and top downtown Birmingham’s residential market with sale prices of $1,000 per square foot or more.

    https://s3-prod.crainsdetroit.com/s3fs-public/ForefrontSold_i.jpg

    1. i can get apartments with views of the freedom tower the UN and empire state building for less then $1000 a sq ft.

  8. A mysterious radio source located in a galaxy 500 million light years from Earth is pulsing on a 16-day cycle, like clockwork, according to a new study. This marks the first time that scientists have ever detected periodicity in these signals, which are known as fast radio bursts (FRBs), and is a major step toward unmasking their sources.

    While the sources remain a mystery, scientists believe the signals are warning earthlings that realtors are liars.

    https://www.vice.com/en_us/article/wxexwz/something-in-deep-space-is-sending-signals-to-earth-in-steady-16-day-cycles

    1. Whoever is sending those fast radio bursts (FRBs) might need some free health care services and University student grants?

      1. SCDaveIf Bloomberg steals the nomination from Bernie. Democrats will lucky to retain the House. They will lose the presidency in an electoral landslide. Just paid $1.96 for gasoline so I going to put this present prediction with your $5 a gallon prediction. Trump engineered TDS in a lab and is using the virus to kill the party of the Democrats.

        1. Bloomberg has next to no shot, IMO. I just don’t think people are that stupid. Think about it – he’s an oligarch. He IS the fake news media. He’s the one controlling the narrative, pushing the globalist agenda. He’s the embodiment of everything that is destroying this country and its people.

          1. Do not forget that he is makes Jeb Bush look dynamic. All the money backing him could not get him a nomination.

          2. I think at his age he realizes he can’t take all that money with him, so he decided to go all-in on a run for president. Even if it was all for not, he still has more money than he could ever spend.

          3. agreed but Bloomberg was just we needed after 9/11 quiet somber but he really did modernize city hall, public hospitals, updated computer systems made it easy to file and see if you were qualified for benefits.

          4. Thank you for the link Ben. Important things for us all to keep in mind. I don’t think I watched this nearly 40 years ago, those were busy days.

  9. “Builders are expected to complete some 371,000 new apartments in 2020, compared to 247,000 in 2019 and 119,000 in 2010, according to RealPage. The problem is that many of the new apartments will be too expensive for lower- and middle-class families. Bernie Sanders blames this on ‘corrupt real estate developers’ who are ‘gentrifying neighborhoods’ and replacing affordable homes with ‘fancy condominiums and hotels that only the very rich can afford.’ Elizabeth Warren says ‘developers can usually turn bigger profits by building fancier new units targeted at higher-income families rather than units targeted at lower-income families.’”

    No candidate since Ron Paul in 2008 has ever pointed out the central cause of unaffordable housing: the speculative excesses and wealth inequality unleashed by the Fed’s “No Billionaire Left Behind” monetary policies.

    1. “No candidate since Ron Paul in 2008”

      Do you remember the Ron Paul “money bomb” on 12/16/2007?

      I do. It was the largest single day fundraising event in U.S. politics to date. I gave his primary campaign $100 that day. I also voted for him in the Ohio primary in 2008 and in the Colorado caucus in 2012 (Santorum finished second to Romney in my precinct in that one, LOLZ).

      Funny how people’s political ideologies can change throughout their lifetimes, and can adapt to support candidates on other “sides” of an allegedly linear political spectrum…

  10. The REIC porcine beauticians must have missed the memo that the housing bubble has popped. The current narrative is that while the market slowed in 2019, it is set to come roaring back in 2020, coronavirus worries notwithstanding:

    “‘The housing market took a breather in 2019, after years of red-hot sellers’ markets,’ Zillow economist Jeff Tucker said. ‘Many sellers were caught off-guard by the changing conditions, and ended up accepting offers at or below list prices that were dreamed up during the height of the frenzy.’”

    1. Real Estate News
      Fewer San Diego homes sold for above-asking price in 2019
      Newly completed single family homes getting finishing touches in the Seville project in Chula Vista on Friday, January 31, 2020.
      (John Gibbins/The San Diego Union-Tribune)
      About 69 percent of San Diego homes sold for under asking price in 2019, said Zillow
      By Phillip Molnar
      Feb. 7, 2020
      2:52 PM

      If you sold a home in San Diego County last year, there’s a high statistical probability it sold for under asking price.

      In 2019, 22.6 percent of homes sold for more than sellers were asking — a smaller amount than the hot post-recession San Diego market is used to.

      In 2018, 25.1 percent sold above asking; 29.8 percent in 2017; 26.8 percent in 2016.

      Zillow economist Jeff Tucker said the numbers are a reflection of a sluggish housing market in the start of 2019. He said there were still comparably higher mortgage interest rates at the start of the year and buyers were less likely to make a sale happen.

      “In San Diego, it was the effects of the previous winter (2018),” he said, “when interest rates were up and there were concerns about a recession on the horizon or tariffs, a government shutdown. There were a lot of concerns.”

      However, don’t expect 2020 to be similar. Tucker said low mortgage interest rates and very low inventory will push up prices above asking price.

      “There’s strong demand running up against limited supply,” he said. “I think that suggests we are going back to a pretty hot housing market for San Diego and more homes will sell above list.”

      CLICK!

  11. Penguins speak like humans, scientists discover

    5 February 2020

    The study was done by scientists at the University of Turin, in Italy.

    One of them said: “It can be mathematically shown that you can convey more information by dividing into shorter pieces rather than uttering a single loud vocalisation.”

    https://www.bbc.co.uk/newsround/51383096

    I have done the Penguin to human translation on this video.

    Let me in the damn boat this Killer Whale is trying to eat me!

    https://www.youtube.com/watch?v=cZQGAAsT3fY

    1. A second penguin recording was recently analyzed and deciphered by researchers at a prominent university.

      The decoded message reads:

      “REALTORS ARE LIARS.”

  12. “Filed last month, it’s the latest lawsuit involving allegations of massive construction defects at a condo building completed during Miami’s most recent development boom, as such suits have become increasingly common.”

    Same thing happened at the peak of the last bubble. Contractors were busy around the clock and finding skilled trades people was near impossible. They start cutting corners to get things on the market ASAP. Then come the lawsuits.

  13. Bernie Sanders blames this on ‘corrupt real estate developers’ who are ‘gentrifying neighborhoods’ and replacing affordable homes with ‘fancy condominiums and hotels that only the very rich can afford.’ Elizabeth Warren says ‘developers can usually turn bigger profits by building fancier new units targeted at higher-income families rather than units targeted at lower-income families.’”

    The 800 pound gorilla in the room that both of these abject liars are avoiding is which political party all the folks that end up moving into those gentrified neighborhoods regularly vote for. If you happen to live near one of these places, go look at the lawn signs in any given election year.

    1. Oops. I mixed up metaphors — that should have been “elephant”, not “800 pound gorilla”. Sorry.

  14. What constitutes “a case” of novel Wuhan coronavirus? For instance, is mere exposure to the virus sufficient? Or do you have to develop symptoms? If the symptoms are mild, or even as severe as the flu, do you count? Do you need to develop full-blown pneumonia? Does symptoms have to warrant a hospital stay?

    Lower thresholds for what qualifies as a case will increase the overall number of cases and decrease the CFR, but without a clear definition of “case”, these numbers are meaningless, regardless of whether the data are real or made up.

    Study of 99 patients finds 11% death rate

    The paper in The Lancet reported on the CFR in patients at one Wuhan hospital. Though the sample is small—99 patients—this is one of the first CFR calculations based on a systematically collected group of cases (all hospitalized at one hospital.)

    Eleven of the 99 patients admitted to Wuhan Jinyintan Hospital from Jan 1 to Jan 20 died, resulting in a CFR of 11%. Half of the patients (49) had a history of exposure to the Hunan seafood market, and among those, 47 had a history of long-term exposure (including salesmen and market managers).

    Of the 99 patients, 67 (68%) were male, and only 10% were under the age of 40.

    All 99 patients had lab-confirmed nCoV, and 74 of the 99 showed bilateral pneumonia on imaging, while 14 showed multiple mottling and ground-glass opacity in their lungs.

    “17 (17%) patients developed acute respiratory distress syndrome and, among them, 11 (11%) patients worsened in a short period of time and died of multiple organ failure,” the authors said.

    “In general, the characteristics of patients who died were in line with the early warning model for predicting mortality in viral pneumonia,” the authors concluded. Those factors include a history of smoking, bacterial coinfection, high blood pressure, and older age, among others.

      1. “The five people were staying in the same accommodation as a British man who was in Singapore from Jan. 20 to Jan. 23. That man became infected with the coronavirus.”

        It seems very contagious, even outside of China.

        1. CNN
          New study an eye-opener on how coronavirus is spreading and how little we know
          By Dr. Tom Frieden
          Updated 6:48 PM ET, Sat February 8, 2020
          What do you need to know about coronavirus?

          A screenshot of an American couple trapped onboard the quarantined Princess Diamond cruise ship.
          US couple quarantined on ship in Japan: ‘Trump, save us’

      1. Even FunYun is warning on coronavirus. And I hate to point this out, but the outbreak has only barely begun to expand. There are only 36K or so confirmed cases, compared to something like 19 million flu cases in the United States.

        There are many months left in the cold and flu season, and some are conjecturing the outbreak will continue into the warm months.

        The REIC can stick a fork in their 2020 housing bounce.

        1. Trends
          U.S. Real Estate Market Shows Symptoms of Coronavirus Effect: What You Need to Know
          By Clare Trapasso | Feb 6, 2020

          The deadly outbreak of the coronavirus from China, which has sickened thousands around the world and terrified millions more, is taking a toll on global financial markets as well—and the effects are likely to extend to the U.S. luxury real estate market.

          While there are only 11 confirmed cases of the virus on American soil, the U.S. housing market is already feeling the effects of what could soon be declared a pandemic. Mortgage interest rates have dipped, and the already sluggish luxury real estate market has depended in recent years on an injection of Chinese buyers.

          “China has been the most important source of foreign demand for real estate,” says Lawrence Yun, chief economist at the National Association of Realtors®. Wealthy Chinese buyers often purchase luxury properties, such as high-rise condos, in California and New York. “The upper-end market can expect to be softer as a result.”

          1. “The upper-end market can expect to be softer as a result.”

            It’s very convenient for the used home sales people to have an evil virus to blame for the crater in luxury real estate. Never mind that the bubble in lux popped years before the coronavirus outbreak began.

          2. ” …but the outbreak has only barely begun to expand. ”

            Just back from the river wilderness, here let me help you out dear Professor:
            (sooooooo much aqdan proselytizing, you’d think he’s one of those jerk highschool eddie.haskells , you know, The smart.kid who knows everything ’bout EVERYTHING!!!)

            SHANGHAI, Feb. 8 (Xinhua) — The routes of the novel coronavirus infection include transmission via aerosol according to health and epidemic prevention experts, said Zeng Qun, deputy head of Shanghai Civil Affairs Bureau at a press conference in Shanghai on Saturday.

            The other major routes of virus infection are contact transmission and direct transmission including transmission via respiratory droplets according to the experts, Zeng added.

            Targeting these transmission routes, Zeng called on residents to take a series of measures including canceling all social activities and gatherings, opening windows regularly to maintain the circulation of indoor air and focusing on household disinfection.

            http://www.xinhuanet.com/english/2020-02/08/c_138766344.htm

  15. Corona virus is a master at math…if you believe fake PRC data that claims a mortality rate over time of precisely 2.1% – no more, no less. Riiiight….

    1/30: 170/7821 = 2,1%,
    1/31: 213/9800 = 2,1%,
    2/01: 259/11880 = 2,1%,
    2/02: 304/14401 = 2,1%,
    2/03: 361/17238 = 2,1%,
    2/04: 429/20471 = 2,1%,
    2/05: 493/24441 = 2,1%
    2/06: 564/28605 = 2,1%

    Right now: 724/34677 AGAIN = 2,1%…

      1. I don’t know what you’re beef with ABQDan is about but he, BlueSkye and I have pointed out repeatedly that the numbers coming out of China are fictitious and likewise the CFR calculation. ABQDan has been looking at numbers outside of China, which are too small at this point to be meaningful.

        1. “I don’t know what you’re beef with ABQDan is about…”

          Saying the numbers are unreliable, then persistently pimping the CCP’s 2% estimate, which is based on spurious math, not to mention the data, gets annoying.

  16. Low interest rates and housing shortage due to low inventory of homes in Sacramento are not causing prices to drop much if at all. I see homes go pending less than a week now.

    1. Look at how low the FED has driven interest rates, and all of the liar loans they’re offering now. It’s a no-brainer that there are going to be suckers jumping in. The problem is that rates don’t have much further to go until zero. Then what? The FED is done. They’re out of bullets and the shit show hasn’t even begun.

    2. Fall 2022 might bee a good evidence.of.fact$ target for $acramento. (ImhTo)

      Got $helter.$hack.price$ patience?

      1. Not sure what you mean. Sacramento is having tons of people moving here from the bay area driving up prices and we already have a housing shortage crisis. Rents are going higher too as well. I grew up here and remember how cheap it was only 10 years ago.

  17. In Fed we trust.

    Why ‘buy-the-dip’ is the stock market’s default setting — and what it would take for that to change
    By William Watts
    Published: Feb 8, 2020 8:17 p.m. ET
    A supply-chain hit could undercut central-bank backstop
    Getty Images
    Still working.

    Investors made crystal clear this past week that they aren’t ready to abandon the “buy-the-dip” response to stock market pullbacks, despite warnings that the tried-and-true approach may soon meet its match.

    Indeed, one high-profile warning came from Mohamed El-Erian, the chief economic adviser at Allianz and former chief executive at Pimco. He made waves early this week when he warned that China’s coronavirus outbreak could be the catalyst that finally snaps investors out of the buy-the-dip mentality. El-Erian laid out a compelling argument in a Financial Times guest column, warning that the potential for cascading global economic fallout from a prolonged outbreak would challenge the ability of global central banks, many of which have already used up their monetary policy ammo, to provide a backstop.

    That may prove true. But for now, investor faith in the central bank backstop looks pretty solid.

    As worries about the impact of the coronavirus on the global economy rose, triggering a sharp selloff in equities, expectations for a Federal Reserve rate cut later this year rose, according to the fed futures market. Efforts by the People’s Bank of China to provide stimulus and liquidity also served to soothe nerves, triggering a sharp rebound in equities that saw all three major U.S. benchmarks move back into record territory by Thursday.

    “I think investors have learned over a very long time that central banks and the Fed, in particular, will be there to save the day,” said Michael Arone, chief investment strategist at State Street Global Advisors, which has $2.8 trillion in assets under management, in an interview.

    That’s a mentality that goes back before the financial crisis to at least the 1987 crash, when the notion of a metaphorical “Fed put” began to take hold.

    1. Supply chain disruption is already starting to hit automakers in South Korea and Europe. The bifurcation between “the markets” where true price discovery has become impassive due to 11 years of massive central bank intervention and suppression of former price discovery mechanism like the bond market, and the real physical economy, i.e. manufacturing, mining, services, etc. is going to become increasingly acute if supply chain disruption starts causing cascading plant and business closures. At some point the Fed’s Ponzi markets are going to be so ridiculously fake and artificially pumped up by Powell Bux and monetized debt that even the dullest retail investor muppets are going to recognize the con game being played by the central banks, and start pulling their money out of the pump & dump. That’s when things are going to start going pear-shaped.

      1. “…suppression of former price discovery mechanism like the bond market, and the real physical economy, i.e. manufacturing, mining, services, etc. is going to become increasingly acute if supply chain disruption starts causing cascading plant and business closures…”

        Has there ever been a comparable point in economic history when central banks short circuited natural market adjustment mechanisms to the current degree, for such an extended period of time? I’m thinking this was doubtless the case inside the U.S.S.R. before its 1989 collapse, but I am doubtful that it has ever occurred to this extent on a global scale.

      2. Supply chain disruption

        They probably planned on the New Year work stoppage, which turned into two weeks. Monday it’s back to work, or not. Should be interesting.

        1. Monday it’s back to work, or not.

          Probably depends on where. I’m kind of doubting that factories in Wuhan will reopen tomorrow.

          1. Saw a story that said Apple wanted to fire up the machines at FoxCon this week and the Chinese government said no.

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