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When There Is A Queue Investors Often Feel They Have To Get In Line So They Aren’t The Last Ones Left To Turn Off The Lights

A report from the Wall Street Journal. “UBS Group AG is stepping up efforts to stem the bleeding at its $20 billion flagship real-estate fund amid concerns over its retail holdings. As late as June 2015, Trumbull had a $1.2 billion backlog of funds looking to invest, and no backlog of investors looking to get out, according to RVK for the Ohio Bureau of Workers’ Compensation. Core funds ‘just had incredible market tailwinds,’ said Christy Fields, a managing principal at consulting firm Meketa Investment Group, Inc.”

“But analysts say once a fund faces a rise in redemption requests, capital outflows can be hard to stop. If a fund manager doesn’t have enough cash to meet the requests, it has to sell properties. That often takes time, causing a backlog and increasing pressure on the fund to sell. ‘When there is a redemption queue investors often feel they have to get in line so they aren’t the last ones left to turn off the lights,’ said Nori Lietz, a faculty member at Harvard Business School.”

The Edmonton Journal in Canada. “Based on interviews with builders, developers, realtors and other industry insiders, David Yee, Edmonton tax leader for PWC Canada notes buyers are facing an abundance of choice in both the new and resale markets, as well as the rental side. And they’re looking for trouble-free, move-in ready products. ‘The homebuilders that we’ve talked with still concede it’s a buyers’ market so people have a lot of choice,’ says Yee.”

The Manchester Evening News in the UK. “Home owners living in a ‘luxury’ new build development say their lives have become a ‘nightmare’ after finding dozens of faults in their properties. Some residents living in the Barnes Village development said they were promised ‘luxurious’ and ‘elegant’ family homes when they purchased off-plan two years ago. But, months after moving in, they say the development is wracked with issues. Michael Morris, 62, who purchased a three bed apartment with his wife inside the renovated hospital building – costing £330,000, said: ‘It has been a nightmare, in our particular circumstances it has been life-threatening.'”

“He added: ‘(Henley) are a nightmare to deal with. They are an outfit from London, they think they can come down here and think we are just cobbled streets and flat caps.'”

The Times of India. “Investors who bought luxury apartments, hoping property prices would appreciate and they would earn fabulous rents, now face a harsh reality. Not only have prices stagnated or dropped, but rental incomes from such flats are low. ‘It’s true. Home owners who have leased big apartments are left with little in hand,’ said Pranay Vakil, chairman of Praron Consultancy.”

“While owners rue investing in what has turned out to be a bad rental market for them, the situation couldn’t possibly better for tenants. In this zero-sum game, the rentier’s loss is the renter’s gain.”

The South China Morning Post. “Hong Kong’s largest property agencies with almost 900 sales offices in the city are asking for discounts on new leases as they brace for further slide in sales after the industry’s worst year since 2016. ‘We have leases coming up for renewal nearly every day and in current market conditions, it will not have much impact to lose some branches,’ said Louis Chan, vice-chairman for Asia-Pacific at Centaline. ‘We are in a situation where no one dares to come out at all’ to view properties, he added.”

The Korea Times. “As the housing bubble is showing no signs of abating, the government is on track to introduce much tighter and broader regulations to normalize the market, in a move to divert the capital flow into more constructive sectors, such as the stock market. But real estate experts here and abroad shared the same view that the current ‘regulations-cure-all’ approach will not be able to calm the overheated market. Experts argued that a shift in the real estate tax system here is crucial to change the ‘real estate-first’ mindset of Korean investors.”

“‘The U.S. government levies a considerable amount of property taxes, with those who purchase a house worth about 500 million won paying almost 5 million won, or 1 percent of the housing price annually, as a property tax,’ Sung Choi, a real estate agent based in Oregon, the U.S., said in an email interview. But under the same standard of comparison, the Korean government imposes only about 1.1 million won for the homeowner’s annual property tax.”

“Kwon Dae-jung, a professor of real estate studies at Myongji University, said controlling housing prices with regulations is a very risky idea, as this goes against the market logic of supply and demand. Also, few other countries intervene in the real estate market by introducing such multiple and specific regulatory packages, according to the expert.”

“‘The U.S. government minimizes its intervention into the real estate market, and adopts flexible regulation by simply controlling loans from time to time,’ he said. ‘The U.S. authority never introduces unnecessary and unreasonable regulations simply because there is a surge in housing prices in some specific areas.'”

From Domain News in Australia. “Domain’s Property Price Forecasts – 2020, released Wednesday, predicts houses in Sydney will rise by 10 per cent over 2020 to a new median of around $1.25 million, while apartments will rise by 8 per cent to a new median of $790,000 – just above the peak reached in June 2017. And if FOMO, or Fear Of Missing Out, sets in as it has in the past, those increases could reach even more record-smashing heights, said forecast author and Domain economist Trent Wiltshire.”

“The major risk lurking in the wings, however, is the coronavirus, which could impact China’s economy massively, with a follow-on slug to Australia, Mr Wiltshire says. ‘The economy overall is sluggish and businesses aren’t keen on investing, but that means interest rates will stay low to try to bolster the economy, which directly feeds into property prices. The big risk, however, is the coronavirus which could have a significant short-term impact on our tourism and education sectors and cause the economy to soften more. It’s possible the outbreak will be much more severe and cause a significant economic slowdown in China, which would have a massive impact on Australia’s economy.'”

This Post Has 142 Comments
  1. ‘And if FOMO, or Fear Of Missing Out, sets in as it has in the past, those increases could reach even more record-smashing heights’

    I was reading some California posters whining last night. Oh, prices are going up! Whatever. I’ve watched prices in Austin crash twice since I first thought of a housing bubble when living there in 1998. I’ve worked in the foreclosure business for 8 years straight, often 7 days a week, week after week. Oh but you’ve seen something last for a few months!

    Get over yourselves drama queens. If it’s a bubble it will pop. That’s all you need to figure out: is it a bubble or not.

    What outfits like Domain News exist for is to lure and trick as many suckers into their doomed bubble as possible, for as long as possible. You shouldn’t have economists talking about FOMO. That’s not economics.

    1. Along these lines:

      ‘As late as June 2015, Trumbull had a $1.2 billion backlog of funds looking to invest, and no backlog of investors looking to get out…Core funds ‘just had incredible market tailwinds’

      Tailwinds! Oh happy days!

      ‘But analysts say once a fund faces a rise in redemption requests, capital outflows can be hard to stop. If a fund manager doesn’t have enough cash to meet the requests, it has to sell properties. That often takes time, causing a backlog and increasing pressure on the fund to sell. ‘When there is a redemption queue investors often feel they have to get in line so they aren’t the last ones left to turn off the lights’

      You see the pattern here? Boom, then bust. Been happening for thousands of years.

    2. https://www.marketwatch.com/story/coronavirus-update-1018-deaths-a-new-case-in-san-diego-who-to-set-research-agenda-2020-02-11

      Hello, San Diego, It’s here!

      Not whining just observing. After about 24 months straight of piling up inventory, inventory in San Diego has plummeted in the last year, down 36% at year end I’m no drama queen, but that’s a pretty dramatic drop in inventory. My neighborhood has been cleaned out. There’s almost nothing on the market and houses are selling in a heartbeat. Where the money is coming from I don’t know. Certainly not something I would have predicted.

      https://www.piggington.com/

      1. I live in Silicon Valley and the number of places for rent has skyrocket. There has been many layoffs or announced layoffs lately too. Xilinx to layoff 300 or Ebay to layoff 100. Don’t forget Lyft to layoff 90 …

        Also talking about Unicorn, Juul to layoff 650 and Uber, Quora, Mozilla, etc. While Facebook and Google are doing fine, many other companies are not. I guess the IPO bubble burst. Look at Casper IPO!

        https://sanfrancisco.cbslocal.com/tag/layoffs/

        The low interest rate has caused a booming construction bubble. New luxury apartments and condos are built everywhere! I think the bubble will go on longer then any rationale person can think it can go on. However, like any bubble, it will POP. And the higher it goes UP, the BIGGER the crash when it falls down.

        1. OH THE HORROR!!! Just like with bubble gum, when it pops you blow another one and even BIGGER! By the time you chase and catch up to the pop your DEAD so buy now or be dead!

      2. It’s the low rates. That’s what it produces. The thing is, they can’t go much lower. If they go to zero, then house prices will be at there absolute pinnacle peak. I don’t believe in negative rates. They don’t work and they’d cause more destruction than help anything. So, we’re close to the end.

        1. I don’t believe in negative rates. They don’t work and they’d cause more destruction than help anything.

          I don’t believe in them either. But when has logic dictated anything in the last 15 years? Bottom line…will it delay the reckoning for any appreciable amount of time?

      3. Reports out of Peru.

        “A 72-year-old Peruvian woman died of the coronavirus in the city of Los Angeles, in the United States, and her body was repatriated to our country”

        “The document issued by the California Department of Public Health indicates that the Peruvian citizen died at the Torrance Memorial Medical Center on January 17.”

        https://radiotitanka.pe/noticias/6605/peruana-murio-por-coronavirus-en-estados-unidos-y-su-cuerpo-fue-repatriado?fbclid=IwAR0B78G_bVTqTwfEp3hpUHhG7Cr_7vEyGuYHmBVa1_-Prg4ms7pC1rb-_cg

        https://m.en24.news/A/2020/02/coronavirus-peruvian-died-of-this-disease-in-the-united-states-and-his-body-was-repatriated-video-peru.html

        Nothing in US media I can find to confirm.

        1. If Zee Germans got 16 cases from one Chinese visitor, how many do you think Thailand ACTUALLY has?

          I cannot believe no one in the US seems even the slightest bit worried about the whole thing. These are, of course, the very same sheeple that will be running around hair-on-fire as soon as we see a small outbreak (say 20 people) in an urban metro.

      4. A quick check @ realtor.com shows ~10% price reduced for SD, CA:
        352/3381=10.4%.

        How’s that possible if no inventory and strong demand? Like most MSAs, still way overpriced. 2019 bounce due to rate cuts and “subprime” v 2018. Waiting for Spring ‘20 for clearer market picture.

        Bottom line is prices are too high for shelter-buyer. Something’s gotta give. There’s no ‘permanent plateau’ in markets.

      5. Its exactly whats being discussed here. FOMO hype from none other than your local commission hungry realtors and lenders. The amount if ads i see regarding loans and real estate is astronomical. I saw a dip in new listings and a ton of wish priced listings disappear and now seeing them flood back in as new. Socal perhaps is currently higher demand and more greater fools getting some of that “sound lending”. These will be the first FBs to walk away. I would give this a couple mabye few more months to weed these idiots out and then inventory will really start to pile up. Patience!

    3. “I was reading some California posters whining last night. Oh, prices are going up!”

      All the leaves are brown
      And the sky is gray
      I’ve been for a walk
      On a winter’s day
      I’d be safe and warm
      If I could buy in L.A
      California whining
      (California whining) on such a winter’s day

      Logged into a blog I passed along the way
      Well I got down on my knees
      Prices went up today
      You know the Realtor just sold
      Two the other day
      California whining
      (California whining ) on such a winter’s day

      https://www.youtube.com/watch?v=dN3GbF9Bx6E

    4. If it’s a bubble it will pop.

      Apparently, enough buyers in San Diego didn’t get those memos.

  2. ‘Investors who bought luxury apartments, hoping property prices would appreciate and they would earn fabulous rents, now face a harsh reality. Not only have prices stagnated or dropped, but rental incomes from such flats are low. ‘It’s true. Home owners who have leased big apartments are left with little in hand’

    This is Mumbai. Once the most expensive residential real estate market on the planet. More than anywhere in California. More than New York City, London, Hong Kong, anywhere.

    Was there a bubble there? Youbetcha! Now look at these broke a$$ losers.

  3. I agree with much of the post until it starts talking about the US intervention in real estate. I agree the US does little to stop a bubble but the US is pretty tenacious about protecting one.

    1. It’s also not the “US Government” that collects property taxes, but state and local. But that’s a distinction Koreans probably don’t know about.

      But the Feds DO meddle in real estate, bigly. Fannie, Freddie, FHA, Freddie Mac, HUD, even USDA are in on the game, during good times and bad. Not to mention actual regulations from the Office of the Comptroller (“qualified mortgages” from Dodd-Frank) and CFPB (predatory lending).

      1. “If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.” – Milton Friedman

  4. Amy, you go girl! Split that globalist vote even more. Bernie, the enemy of my enemy is my friend. Enjoy your victory

      1. Re-post from 4/26/2019 — Joe Biden: An Imperial Corporatist Wrapped in the Bloody Flag of Charlottesville:

        “Biden is so corporatist and pro-Wall Street that he can’t join the other corporate (neo) liberals in the 2020 presidential horse race in playing what a still-Left Christopher Hitchens once called (in a sharp volume on the neoliberal Clintons) “the essence of American politics”: “the manipulation of populism by elitism.” Biden won’t deign to pay lip-service to populism. Indeed, he has billed himself the “anti-populist” – the antidote to both the right-wing reactionary populism of Trump and the leftish progressive populism of Bernie Sanders.

        Biden absurdly criticizes those who advocate a universal basic income of “selling American workers short” and undermining the “dignity” of work. He opposes calls for free college tuition and Single Payer health insurance. He defends Big Business from popular criticism, writing in 2017 that “Some want to single out big corporations for all the blame. … But consumers, workers, and leaders have the power to hold every corporation to a higher standard, not simply cast business as the enemy.”

        That’s called blaming the working-class victim. It’s also called propagating a fantasy – the existence of a political system in which the working-class majority has the power to hold concentrated wealth and power accountable.

        “I don’t think five hundred billionaires are the reason we’re in trouble. The folks at the top aren’t bad guys,” he told the Brookings Institution last year – this as he claimed to worry about how the “gap is yawning” between the super-rich and the rest.

        https://www.counterpunch.org/2019/04/26/joe-biden-an-imperial-corporatist-wrapped-in-the-bloody-flag-of-charlottesville/

  5. The Korea Times. “As the housing bubble is showing no signs of abating, the government is on track to introduce much tighter and broader regulations to normalize the market, in a move to divert the capital flow into more constructive sectors, such as the stock market.”

    and

    “The U.S. government minimizes its intervention into the real estate market, and adopts flexible regulation by simply controlling loans from time to time,’ he said. ‘The U.S. authority never introduces unnecessary and unreasonable regulations simply because there is a surge in housing prices in some specific areas.’”

    – Governments never interfere in free market activities. There are no market distortions currently.

  6. Now this is exactly the type of newly minted immigrant$ that Thee Engli$h royal$ truly love coming to Thee UnUnited.Kingdom!

    Middle Ea$t = $audi’$+ & Co.

    MARKET REPORT$:

    Middle Ea$tern Buyer$ Inve$ting in the U.K.’s Prime Country House$ Tripled in 2019,

    Good school options and transport links are a big draw

    BY LIZ LUCKING | ORIGINALLY PUBLISHED ON FEBRUARY 10, 2020 | MANSION GLOBAL

    The number of Middle Eastern buyers snapping up high-end homes in the U.K. countryside more than tripled in 2019, according to a report Monday from Knight Frank.I

    Middle Eastern buyers accounted for 13.8% of all sales of country houses priced at £5 million (US$6.45 million) and up last year, an increase from the 3.8% recorded in 2018, the estate agency and property consultant found.

    Though some of the most affluent areas in London are generally associated with wealthy international buyers, the draw of the countryside, its education options and, in some areas, its proximity to London, can prove hard to resist.

    “While heightened economic and political uncertainty in the Middle East can be attributed, in part, to [Middle Eastern buyers’] increased appetite in the country market, the attraction of private education options is also particularly significant,” Rupert Sweeting, head of national country sales at Knight Frank, said in the report.

    “Areas in close proximity to London, such as North Surrey, have been extremely popular with Middle Eastern buyers. The many respectable international schools, combined with easy access into London, makes the Surrey area particularly attractive to buyers from the Middle East looking to settle in the U.K.,” Mr. Sweeting added.it

  7. Ethanol fuel$ = No … High protein critter food, Ye$

    AGRICULTURE | FEBRUARY 11, 2020 / UPDATED 7 HOURS AGO

    U.S. ethanol woes spur new animal food focus for Green Plains -CEO

    Reuters |By Mark Weinraub

    CHICAGO, Feb 11 (Reuters) – Green Plains Inc, one of the biggest U.S. ethanol producers, is planning to flip its business model upside down to survive a crash in prices for the corn-based fuel.

    The company will invest some $400 million in the next two to three years at its 13 plants to make high-protein, corn-based animal feeds its new flagship product, relegating ethanol to a low-margin byproduct.

    The plan upends the company’s years-long strategy of pumping out the fuel and selling off the remnants as a low-quality feed known as distillers dried grains (DDGS) for cows and pigs.

    “We will start to transform, with ethanol as a co- or byproduct,” Green Plains Chief Executive Todd Becker said in a recent interview. “We think that is the only way to thrive long term in an industry like this.”

    The strategy reflects a devastating ethanol market outlook as U.S. demand for motor fuels is projected to fall and the Trump administration waives biofuel blending requirements for more and more oil refiners.

    “We believe this will be our main commodity, main revenue stream and main profit stream,” Becker said. “The ethanol today is an industry that is oversupplied and undisciplined.”

    Green Plains’ ethanol revenue fell 19.8% to $1.701 billion in 2019, its annual report released on Monday showed, the lowest since 2010. It will hold a call to discuss the report on Tuesday.

    Green Plains will start production of its new feed in February at a plant in Shenandoah, Iowa, following a $35 million investment.

    The feed produced there will contain 50% protein, allowing it to charge a premium to the ethanol industry’s typical DDGS with around 30% protein. The new feed, targeted at aquaculture producers and pet food companies, contains even more protein than soymeal.

    Soymeal sells for about double the price of DDGs, according to the U.S. Grains Council.

    Green Plains, which partnered with Novozymes A/S to boost the protein content of the feed through enzymes and microbial technologies, has already formed a joint venture with Optimal Fish Food to produce their aquaculture feed.

    The feed, which could run as high as 60% protein content in the coming years, is insulated from the political headwinds that have devastated the ethanol market, Becker said.
    (Reporting by Mark Weinraub; Editing by Richard Chang)

    1. “The ethanol today is an industry that is oversupplied and undisciplined.”

      Ending that stupid experiment will make food and gasoline less expensive.

      1. As far as I know the main subsidy has ended at the pump. There may still be subsidies at the farms. All I know is I’m still enjoying getting ethanol race gas (E85) at the pump just down the highway :-). 105 octane gasoline without the ethanol is over 8 bucks a gallon.

    1. The Chinese government is happy to report that Chen’s heart is still beating, his liver is doing well, and his kidneys are living apart but handling it splendidly.

  8. A study by Chinese researchers found that the incubation period for the new coronavirus can be up to 24 days, contrary to the previously believed 14 days.

    Analysis of data from 1,099 patients diagnosed with the new 2019-nCoV at 552 hospitals showed that only 1.18% had direct contact with wildlife.

    Meanwhile, 31.3% had been to and 71.8% had contact with people from Wuhan, the epicentre of the ongoing coronavirus outbreak. The median age of patients was 47 years, and 2.09% were healthcare workers.

    https://www.pharmaceutical-technology.com/news/coronavirus-study-incubation-period/

    1. The lies and spin from China are so thick at this point there’s no way to know what’s going on. Looking at a graph of the increase in “confirmed” cases, it shows a disease waning. Meanwhile, in reality, it’s exploding.

        1. One thing I have been trying to follow is the # of deaths from the virus OUTSIDE of China. For all the hoo-ha, 2 or 3 of these have been reported so far. One of the doubtful deaths has been mentioned elsewhere on this blog. All other deaths have been WITHIN China. Rather a strange discrepancy.

          1. Rather a strange discrepancy.

            I’m guessing that top health care really helps. People don’t usually die of pneumonia if they have the best of everything, right? Problem is, there isn’t enough top health care to treat everyone at the same time in any country/area. Maybe if everyone is going to get it, you want to be one of the very first ones or one of the very last ones.

          2. Very last would be best if a cure is found by then. First might be better if the illness evolved to become more deadly as it propagated.

          3. “discrepancy” 2 factors in China are noteworthy: high levels of cigarette consumption and air pollution.

          1. I’m guessing that top health care really helps. People don’t usually die of pneumonia if they have the best of everything, right?
            No. When I was in med school 50 years ago, we were taught that pneumonia is very often the last thing a patient has just before they die, even if the original problem was injuries from car wreck, etc. It was extremely common to find that in post mortem lungs (back in ye olden times when autopsies were done much more often).
            Antibiotics, antivirals and ventilation support can save many suffering from pneumonia. Ventilation is resource-intensive, and in limited supply. An epidemic of viral pneumonia could easily overwhelm even a modern healthcare system.

  9. Wor$er & wor$er …

    Household debt jumps the most in 12 years, Federal Reserve report says

    PUBLISHED TUE, FEB 11 20201 | By Jesse Pound | CNBC

    Mortgage originations were $752 billion in the fourth quarter, the highest quarterly rise since 2005, but this was mostly due to an increase in refinancing activity

    “The data also show that transitions into delinquency among credit card borrowers have steadily risen since 2016, notably among younger borrowers

    Total household debt balances rose by $601 billion last year, according to the Federal Reserve.

    Total household debt balances surpassed $14 trillion for the first time.

    Household debt surged by more than $600 billion in 2019, marking the biggest annual increase since just before the financial crisis, according to the New York Federal Reserve.

    Total household debt balances rose by $601 billion last year, topping $14 trillion for the first time, according to a new report by the Fed branch. The last time the growth was that large was 2007, when household debt rose by just over $1 trillion.

    Fed economists said on the Liberty Street Economics blog that the growth was driven mainly by a large increase in mortgage debt balances, which rose $433 billion and was also the largest gain since 2007.

    Housing debt now accounts for $9.95 billion of the total balance. Balances for auto loans and credit cards both increased by $57 billion for the year, according to the Fed.

        1. I’m STILL waiting for somebody to pre-pay 30 years of rent in one check. Meanwhile, I’m in indentured servitude for the next 14 years. But if I live to 90, I actually will have pre-paid the next 25+ years of “rent” (yeah yeah I know about prop taxes).

          1. But if I live to 90, I actually will have pre-paid the next 25+ years of “rent” (yeah yeah I know about prop taxes).

            What about maintenance and repair? A new roof in these parts can equate to almost 10 years worth of rent. A new HVAC system nearly 2 years, etc.

          2. 10 years worth of rent

            Here the $5,000 wouldn’t cover more than a year’s worth of rent. I’m confidant that my new steel roof won’t need to be replaced in my lifetime. It’s Blue, in case you wondered.

          3. I’m grateful to our landlord for spending his own time, effort, and money on the care and maintenance of our place. It’s an incentive-compatible arrangement, as our previous landlord discovered when she had to accept a lowball offer to cover deferred maintenance costs.

          4. A new roof in these parts can equate to almost 10 years worth of rent. A new HVAC system nearly 2 years, etc.

            I am sorry, this should read 2 years for the roof and 1 year for the HVAC system. I’m not sure what kind of math I was doing in my head. The point being, a new roof can run up to $20,000 for a decent size house, even more if it’s a real large one. And, a new HVAC system is running around $10k here. It’s still quite a bit of rent.

          5. The point being, a new roof can run up to $20,000 for a decent size house

            Say what? I replaced mine for $7000 last year.

        2. The point being, a new roof can run up to $20,000 for a decent size house
          Say what? I replaced mine for $7000 last year.

          The cost will be whatever the roofing contractor can “con” the homeowner into agreeing to pay. I paid ~$7000 for a steel roof 7 years ago, but got an estimate from someone else for $15,000 for the same job. I even got an estimate for $14,000 for a asphalt shingle job on my house, ridiculously high.

          1. Markets fluctuate wildly. I paid $10,000 for an asphalt shingle roof 15 years ago, and it was small but with lots of hips and valleys.

          2. My $5,000 roof has exposed fasteners, so I guess it’s only as good as the gaskets on the screws? Price included stripping off the elephant ear asphalt shingles and the cedar shakes under them, plus some carpentry where the old chimney used to be. Extra was $500 for the roll-off dumpster. 2nd story roof over a floor with something less than 1000 ft2. Gutters included.

      1. Slavery has become so typical that many people consider it normal, even “responsible”.

        The “typical” US household owes 2 x their gross yearly income. It was 1 x not that long ago. Those folks who have to balance the average against those of us who don’t owe anything might just be in serious trouble.

        1. Those folks who have to balance the average against those of us who don’t owe anything might just be in serious trouble.

          Oh I’m sure they’ll have ideas for how to make things more fair.

        2. “Slavery has become so typical that many people consider it normal, even ‘responsible’.”

          This is what victory looks like.

          Like it, love it, want more of it.

          😁

    1. This is what you get when you have a rapacious group of oligarchs who can never get enough, spoon fed by central bankers. It’s a clap back, and now we march towards Socialism. Wonderful.

    2. ““This is my place,” said rent striker Francisco Perez. “I spent 20 years, a good part of my life.” Perez takes pride in the apartment he’s shared with his wife for the past two decades but said he can no longer keep up with the rising rent. The retired roofer said it’s more than doubled in the past five years.”

      This sounds like a cultural issue, this idea that if you live somewhere long enough eventually they have to give it to you. Well, that’s a “mortgage,” not rent. Perez signed 20 contracts saying that if he didn’t pay rent, he gets thrown out.

      Oh, and if he’s a retired roofer, then why does he have to live in the Bay Area? I’m sure he can afford rent in Kokomo, Indiana.

      1. “Oh, and if he’s a retired roofer, then why does he have to live in the Bay Area? I’m sure he can afford rent in Kokomo, Indiana.”

        Didn’t the Mamas & Papas explain it in, “California Dreaming?”

      2. Oh, and if he’s a retired roofer, then why does he have to live in the Bay Area? I’m sure he can afford rent in Kokomo, Indiana.

        How does that work exactly? Does the Bay Area only house rich people? If so, where do all the janitors, fast food, retail and tradespeople live? How do you have a city which can’t house its workers? Further, how does that work out for the people of Kokomo whose rents are no longer affordable because of Bay Aryans moving there en masse?

        1. I recall reading a story about how low wage people are riding buses during the wee hours of the morning to their menial jobs in the bay area, which pay a lot more than the same jobs do out in the boonies where they live.

          1. The boonies aren’t even that far away. It’s just a horrible commute due to the ridiculous traffic.

        2. How do you have a city which can’t house its workers? I suggest you interview a few thousand homeless people in LA, SF, Seattle, etc. etc.

  10. https://www.bloomberg.com/opinion/articles/2020-02-06/the-federal-reserve-faces-a-housing-conundrum
    Economics | The Fed Faces a Housing Conundrum
    Artificially repressed interest rates have perverted what was once a market driven by supply and demand.
    By Danielle DiMartino-Booth
    February 6, 2020, 6:00 AM MST | Updated on February 6, 2020, 11:46 AM MST

    “Slower home-price appreciation can be had in one of two ways: either via rising mortgage rates or a slowing economy. The downside is that neither is beneficial to the broader housing market. This defines the dilemma that’s emerged for the largest generation of potential homebuyers since the baby boomers came of age. Artificially repressed rates have perverted what was once a market driven by supply and demand.

    “On the heels of December’s existing home sales report, Bleakley Advisory Group chief investment officer Peter Boockvar noted that investors made up 17% of purchases, up from November’s 16% share and 13% a year ago. “Investors continue to lift the pace of their buying as they search for yield,” Boockvar said. “Thank you Fed for pricing out natural buyers and especially young, first-time buyers.” “

    “As vexing as the deterioration in affordability may be for Powell, he may have something even worse on his hands. For the best real-time and cleanest take on the state of the nation’s job market, always look first to non-seasonally adjusted continuing jobless claims. This figure is a pure reflection of the number of Americans covered by unemployment insurance who have applied for unemployment insurance and been approved and are collecting said insurance. In 2019’s last three months, continuing claims on this basis rose 1.9% from a year earlier, and were up 1.5% in the first four weeks of January. These are the first increases seen since 2009.”

    1. Additional info. on employment, which is a lagging indicator to the business cycle. The last shoe to drop, so to speak. The business cycle can be extended (via large quantities of Yellen bucks and other central bank machinations and repressions), but can’t be prevented.

      https://twitter.com/TaviCosta/status/1227292310020321280
      Otavio (Tavi) Costa | @TaviCosta
      Beleaguered.
      Companies are significantly shrinking hiring plans as profits fall.
      Last resort to boost earnings?
      Deteriorating fundamentals continue to signal a downturn in the business cycle.
      Key note:
      This is all pre coronavirus epidemic.
      11:04 AM · Feb 11, 2020

      https://twitter.com/Not_Jim_Cramer/status/1227297684895207427
      Not Jim Cramer | @Not_Jim_Cramer
      In addition to printing the largest two month decline in Job Openings on record, today’s JOLTS release prints the largest negative surprise on record. [See chart]
      11:25 AM · Feb 11, 2020

    1. I’m somewhere between awed and incensed at how they were able to shut Tulsi out. It’s almost like they don’t want to win, they just can’t get Bernie to stop trying.

    2. “Creepy Joe” is second to last. Not just Hunter’s exploits are hurting him. Joe is his own worst enemy, and that’s “no malarkey”. 🙂

      1. Biden is emblematic of the crony capitalist status quo. Only slack-jawed boomers who have watched their shacks and 401(ks) go up thanks to the Fed’s tsunami of money printing are voting for him. Young people who have a dim perception of how badly they’ve been screwed over by globalism, but lack the intelligence to put the blame where it belongs, are going for Bernie en masse.

      1. Warren under 10%

        Same at 73% in. Biden also.

        It seems weird to me that the party which has been telling us for three years that the biggest threat to our country is the Commies, has an avowed and unashamed Commie as their front running candidate.

        Something’s going to break.

        1. Doesn’t “seem weird” to me at all. The party is in a shambles. Meanwhile, Main St. USA is, too, and they’re looking to latch on to anybody who they think can offer them a way out of this “no oligarch left behind” sham of an eCONomy we have now. Bernie seems to check most of the boxes.

          1. There’s a difference.

            Both idealistic names which have never played out to be benevolent. Never. No distinction.

        2. PS- Bernie’s a socialist, not a communist. There’s a difference.

          A lot of people are going to be thrilled when he confiscates a big chunk of their savings, IRAs and 401Ks.

          1. That’s paranoia. I’d actually vote for him if he didn’t change his stance on open borders and if he weren’t for student loan forgiveness. We need a single payer healthcare system.

          2. We need a single payer healthcare system.

            I took two health economics courses in business school. No, we don’t. The biggest reason against a single-payer system is that healthcare decisions are made at the population rather than individual level. See, e.g., Baby Charley.

          3. We need a single payer healthcare system.

            All of my European relatives have private insurance, as in in their own words the socialized medicine in their countries is a disaster. The private insurance means they can have treatment/surgery/etc. right away instead of long waits, especially for surgery.

  11. Core funds ‘just had incredible market tailwinds,’ said Christy Fields, a managing principal at consulting firm Meketa Investment Group, Inc.”

    Those “tailwinds” are due solely to the Fed’s deranged money printing.

  12. “He added: ‘(Henley) are a nightmare to deal with. They are an outfit from London, they think they can come down here and think we are just cobbled streets and flat caps.’”

    Well, they suckered you into massively overpaying for their shoddily-constructed “off plan” shacks, didn’t they?

  13. “Investors who bought luxury apartments, hoping property prices would appreciate and they would earn fabulous rents, now face a harsh reality. Not only have prices stagnated or dropped, but rental incomes from such flats are low.

    It would take a heart of stone to read about these greedy fools “investing” in overpriced shacks, only to end up subsidizing their renters, and not laugh.

    1. Biden’s lifeline is minority voters or more accurately the fact that neither Mayor Pete nor Bloomberg can attract them. I want him to keep running. You have to keep the crony capitalist/globalist vote divided for Bernie to win the nomination. So far so good.

      1. Will any of the globalists pledge their delegates to Sanders at the convention, or will the Davos crowd pick a candidate and the others will pledge their votes to the puppet?

        1. If Bernie goes into the convention with a plurality of the delegates, the Democrats have two losing choices. They can deny him the nomination with backroom deals and lose a lot of Bernie Bros and gals in the general election. Most will not vote for Trump but they will not vote which is almost as good. Their second choice is to nominate him and lose many moderate voters. Now, if the Democrats could tomorrow get behind one globalist they might avoid the plurality for Bernie. However I do not see them doing it and the delicious irony is that it is probably Bloomberg which prevents it. He is going to divide the globalist vote just when it needs to be consolidated. He may buy 20 percent of the vote on super Tuesday but that is not enough but it is enough to keep Mayor Pete from winning the day. Meanwhile other moderates are getting delegates and he is not prior to super Tuesday. After super Tuesday it may be impossible to stop Bernie particularly if Warren continues to fade.

      2. Minority voters are Biden’s lifeline? Really? Even though his favorite story is when the bad, black gang member “Corn Pop” pulled a blade on him at the pool, and Biden scared angry black man “Corn Pop” with his badass attitude?

        1. His Obama connection has served him well, his support is eroding but where do they go. Many blacks belong to very conservative churches, do you think they are going to vote for Pete? Going to vote for stop and frisk Bloomberg? Other blacks are Muslims and yes anti-Semitic. Lining up to vote for Bloomberg and Sanders?

  14. Tom Steyer is out. He was one of the more sane Democrats. Sending donations to Bernie Sanders and Tulsi Gabbard in the morning. F**k you, globalists, and the horse you rode in on.

  15. Don’t worry about the fake news article about to post. Our resident expert has offered his personal assurance that all is well.

    1. Health & Medicine
      Coronavirus likely now ‘gathering steam’
      Patients in a makeshift hospital in China.

      In China, the number of confirmed cases of the coronavirus reached 42,700 on Feb. 11, according to the World Health Organization. To accommodate the growing number, an exhibition center was turned into a temporary hospital in Wuhan.

      Feature
      China via AP Images
      Leaky international cordon may mean equivalent of worst flu season in modern times

      Alvin Powell
      Harvard Staff Writer
      February 11, 2020

      The number of confirmed cases of the Wuhan coronavirus have continued to surge inside China, sickening tens of thousands, with a death toll of more than 1,000. But outside the Asian giant the numbers remain a fraction of that, a trend Harvard’s Marc Lipsitch views with suspicion. Lipsitch thinks it is just a matter of time before the virus spreads widely internationally, which means nations so far only lightly hit should prepare for its eventual arrival in force and what may seem like the worst flu season in modern times. Lipsitch, professor of epidemiology at the Harvard T.H. Chan School of Public Health and head of the School’s Center for Communicable Disease Dynamics, talked to the Gazette about recent developments in the outbreak and provided a look ahead.

    2. Rooting for the virus twisting my words all so you do not have to man up about the mortality rate. I have never said all is well and have always said that this is a very dangerous virus much worse than common flu. Our disagreement is about the mortality rare, you were throwing out numbers such as north of 30 percent, I started out with 2 to 4 percent and now believe it will be under 2 percent. I have taken no position on the ability to go global and kill millions. I do think the probability of that is dropping due to seasonal factors and progress in treatments and vaccines. However I think the most dangerous time may be next fall since this does seem to follow a flu pattern.

      1. “…you were throwing out numbers such as north of 30 percent,…”

        Those were calculations, based on a formula from a site you posted.

        You’re the one who constantly throws out numbers and then defends them aggressively.

        1. Here are more numbers from outside of China while there are more than 500 cases, there have been two deaths, more than 50 recovered patients, and only 12 people in serious condition. Peak flu season usually occurs better December and the end of February. So far this virus has acted very flu like. We know that it dies in sunlight in a matter of minutes, thus longer days diminish it’s transmission. Trump has done a good job of buying this country time to develop treatment and a vaccine with strict measures and to avoid transmission in the most favorable season. In the end, the world will probably have to live with the virus. It may mutate and join the two coranaviruses which cause the common cold, three cold viruses is bad enough or it could mutate and become more deadly. I have posted about mutation. But for right now we have a virus which had an original mortality of 2 to 4 percent by the estimates to one which probably will be under 2 percent. That is the normal progression since the most severe cases are identified first.

        2. aqdanny.boy, preached that Boeing’$ 737max would bee $ailin’.in.thee.$kies on loverly tailwind$ bye Dec 2019.

          Next up: his “prognostication$”.onthee.virtue$ of mining profit$ from inve$ting in coal.

          1. The jury is still out whether Boeing and coal will be tail winds by election day. Headwinds now but we are still seven months away from significant early voting.

  16. Not to worry…all is well!

    “WHO is sticking to 2 to 14 days since it appears that person had a second exposure.”

    1. On 11 February 2020 WHO finally got around to giving the new viral disease an official name: COVID-19. The virus and its species will have different names. The “19” was adapted from 2019 when the disease was first observed. Took them long enough to get this far.

  17. ‘So how did the messiah of the ed-tech sector slide down a slippery slope? Industry insiders said that the early success of Prakash business was purely because of his entrepreneurial spirit and aggression. This same aggression could also have been the result of his downfall.’

    “Shantanu would manage to bring 50 schools on board even as we were struggling with one. We often noticed that these schools were not fully serious about the payments or contract continuity,” said the Vice- President of a rival firm.’

    https://www.moneycontrol.com/news/business/companies/a-look-at-the-rise-and-downfall-of-ed-tech-messiah-shantanu-prakash-4936861.html

    1. ‘Some shopping mall landlords in Hong Kong, including Sun Hung Kai Properties 0016.HK, the city’s largest property developer by value, are offering relief measures such as rental concession to their tenants during the coronavirus outbreak. Sun Hung Kai Properties said it would reduce February rent by 30-50% for most of its tenants, in an effort to stabilize economy and protect employment.’

      ‘Hong Kong’s retail sector, already battered by months of often violent anti-government protests, is likely to get worse in coming months as a new coronavirus outbreak in mainland China has emptied shopping centres and closed down tourist attractions. Separately, Sun Hung Kai Properties said home sales and hotel occupancy rates have been affected by the epidemic.’

      https://www.nasdaq.com/articles/hks-sun-hung-kai-properties-cuts-feb-rent-by-up-to-50-for-most-retail-tenants-2020-02-12

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