The Hall Of Mirrors, In Which Policymakers Read Asset Prices While Simultaneously Trying To Guide Markets

1. I re-watched Blade Runner this weekend after many years. I had forgotten it was set in the year 2019.

   1. Yes, the new one was set in 2049, I liked the movie but it was too long. Have to admit part of that was because I went to one of those theatres which serves beer and food and my bladder did not allow me to see the last five minutes. Had to catch that part at home. lol

   2. “Do Androids Dream of Electric Sheep?” —Philip K. Dick

   3. In the beginning, Androids will likely be created to work in Amazon Fulfillment Centers.

2. ‘The view while flying over Cambodia from the inland tourist mecca of Siem Reap to the coast is jarring: The national forests that once held Asian tigers, elephants, leopards, bears and other endangered species have been replaced by scarred, deforested industrial landscapes. And where was the beach paradise I was expecting when I landed? Cambodian coastal cities like Sihanoukville and Kampot may have made The New York Times’ ’52 Places to Go’ list, but for people who have actually made the trek, it’s a depressing destination strewn with garbage and overrun with construction’

   And the NYT would be the first to shout “we’re all gonna die” from rising oceans, yet produce globalist slop like this. Hardly a more dystopian situation could be imagined than what this combination of “free trade”, QE, a blind eye toward China’s environmental and human rights policies. Did you know people over there set them selves on fire in protest? They do organ harvesting on political opponents? The air, water and even the soil are toxic.

   Just how far does it have to go to realize these communists are seriously bad news? Is that a far right sentiment Krugman?

   1. The Economist report on the BRI last week mentioned this same town. Short excerpt –
      “Sihanoukville… More buildings are in a state of hasty construction than are completed – last year a high-rise collapsed, killing 28 workers. The city’s drains cannot cope. Maggie Eno, who runs the M’Top Tapang school for street children, shows how monsoon floods turned the ground floor and playground into seas of raw sewage. Brothels operate put of plyboard shanties on construction sites. Thugs murder rivals in gangland killings, dumping victim’s bodies out of cars in the middle of town. And Sihanoukville’s beaches are piled high with plastic detritus from the Chinese invasion.”
      It’s like a dystopian movie come to life, and it’s a lot worse than Krugman’s slightly dystopian Spanish vacay.

3. Georgetown, TX Housing Prices Crater 11% YOY As Austin Area Housing Market Turns Toxic On Rampant Mortgage Fraud

   https://www.zillow.com/georgetown-tx-78628/home-values/

   *Select price from dropdown menu on first chart

   A noted economist stated, “A housing ‘recovery’ is falling prices to dramatically lower and more affordable levels by definition.”

4. $ynchronized Global.$lowing is a $ocial.media myth!

   (Doe$ A countrie$ export$ ri$e when they $lide into a rece$$ion?)

   Some of the world’s biggest economie$ are on the brink of rece$$ion

   By Julia Horowitz, CNN Business, Sun February 23, 2020

   there are signs that some of the world’s top economies could slide into recession as the outbreak compounds pre-existing weaknesses.

   Take Japan: The world’s third-largest economy shrank 1.6% in the fourth quarter of 2019 as the country absorbed the effects of a sales tax hike and a powerful typhoon. It was biggest contraction compared to the previous quarter since 2014

   hen there’s Germany. The biggest economy in Europe ground to a halt right before the coronavirus outbreak set in, dragged down by the country’s struggling factories. The closely-watched ZEW Indicator of Economic Sentiment in Germany decreased sharply for February, reflecting fears that the virus could hit world trade.

   Bank of America economist Ethan Harris points to the number of smaller economies that are hurting, too. Hong Kong is in recession and Singapore could soon suffer a similar fate. Fourth quarter GDP data from Indonesia hit a three-year low, while Malaysia had its worst reading in a decade, he noted to clients on Friday.

   Meanwhile, engines of growth like China and India slowed in 2019. Fourth quarter GDP data for the latter comes out this week.

   All of this brings to the fore concerns about the global economy’s ability to withstand a shock from the coronavirus. Harris says the weak quarter was likely a result of lingering damage from the trade war between China and the United States. The coronavirus is poised to make matters worse.

   “Global equities have rebounded as the US and China have converged to a ceasefire, but companies with global supply chains remain deeply uncertain,” he said.

   On the radar: Even the United States may not be in as strong a position as previously thought. IHS Markit said Friday that US services sector contracted in February, with the reading hitting a 76-month low. It’s the first time the sector has contracted in four years.

   President Donald Trump is scheduled to arrive in India on Monday for a state visit with Indian Prime Minister Narendra Modi.

   In the background: A brewing trade fight between the United States and one of the world’s most crucial emerging economies.

   Last year, the Trump administration ended special trade treatment for India, removing a status that exempted billions of dollars of the company’s products from US tariffs. India increa$ed tariff$ on U$ export$ in respon$e.

   The United States has since been occupied with other trade conflicts — namely nailing down a truce with China. But following a “pha$e one” deal with Beijing, the spat with India may get renewed attention. That could mean an agreement to take a step back, or a breakdown in communication and more e$calation.

   Managing expectation$:

   Larry Kudlow, Trump’s top economic advi$er, told reporters on Friday not to expect a big trade component to the visit. “I think you might see his public willingness to negotiate with India,” he said. “He and Modi, they’re friends”

5. So how is Bernie paying the illegals on his campaign? Is he allowing them to use stolen social security numbers? Seems like he is committing truly impeachable offenses before he even has the nomination:

   https://news.yahoo.com/latinos-sanderss-secret-weapon-in-nevada-could-make-him-unstoppable-on-super-tuesday-015922411.html

   1. The Communists, er I mean Democrats, are having an auction. “I will give you free health care.” “Oh yeah, well I will give you free health care and cancel your student loans.” “Oh yeah, I will give you free health care, cancel your student loans, give you free tuition.” “Oh yeah, I will give you universal basic income, free health care, free college tuition, cancel your student debt, free housing, free food, free everything.”

      1. And green cards for everyone!

         1. “A member of the board of directors for the Boulder Area Realtor Association is scheduled to be sentenced in June after a jury found him guilty of raping a 20-year-old woman who was babysitting his children.

            Curtis Jay Hilty, 39, of Broomfield, was found guilty last week of sex assault on a helpless victim and sex assault, overcoming a victim’s will, both felonies. He could face life in prison for having sex with his children’s babysitter after she fell asleep.”

            https://www.dailycamera.com/2011/04/21/boulder-area-realtor-convicted-of-raping-20-year-old-babysitter/

            1. Since you appear to like to cherry pick with these posts I thought I would give it a try also;

               It was pure chance that Ada Alfonso discovered a high-risk registered sex offender among the licensed electricians that her office oversees. Benjamin B. Brause had renewed his license online in June 2016 — even though at the time he was locked up for sexually assaulting a boy he coached in youth football.

               https://www.bostonglobe.com/metro/2019/12/14/scores-registered-sex-offenders-have-state-licenses-electricians-manicurists-and-more-the-official-who-found-out-got-fired/hJAnvmdU7RqZg6MdvodunJ/story.html

            2. Surely a case where the meme “…it was cheaper than renting!” does not apply.

            3. Since you appear to like to cherry pick with these posts I thought I would give it a try also

               To be honest, I find these rap sheet posts to be puerile, along with nonsensical “lock the doors and call the cops” posts that pop up here. Of course, with the Joshua Tree extension I can filter most of them out.

               I like to come here to read useful information, not rants.

            4. I like to come here to read useful information, not rants ??

               As do I….

            5. Housing.

6. ‘Perpetrators of the liberals-did-it lie are still out there, still getting space to spread their disinformation in mainstream media’

   This left-right thing is dead. Millions of people who voted for Obama twice are about to vote for the President a second time.

   ‘Paul Krugman: An Alien Invasion Could Fix the Economy …
   business.time.com › 2011/08/16 › paul-krugman-an-alien-invasion-co…
   Aug 16, 2011 – Aliens. Paul Krugman probably feels like an alien himself these days, … “If we discovered that space aliens were planning to attack, and we …’

   1. ‘Krugman In ’02: ‘Greenspan Needs To Create A Housing Bubble’

      https://www.businessinsider.com/krugman-in-02-greenspan-needs-to-create-a-housing-bubble-2009-6

      ‘McArdle have pulled a funny and embarrassing quote from Paul Krugman, published in a 2002 NYT column: “The basic point is that the recession of 2001 wasn’t a typical postwar slump, brought on when an inflation-fighting Fed raises interest rates and easily ended by a snapback in housing and consumer spending when the Fed brings rates back down again. This was a prewar-style recession, a morning after brought on by irrational exuberance.To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.”

      https://www.businessinsider.com/krugman-in-02-greenspan-needs-to-create-a-housing-bubble-2009-6

      But still, here in 2020, we read this a$$-hat telling us what caused the bubble.

   2. “This left-right thing is dead. Millions of people who voted for Obama twice are about to vote for the President a second time.”

      It is or should be all about globalism. Globalists want to level income inequality for workers in the world by lowering US wages through outsourcing and immigration. Of course, very little effort to lower the inequality which leads to their billions. Whether you are left or right, if you vote for a globalists in this country, you are an idiot unless you belong to the .01 percent.

   3. If we discovered that space aliens were planning to attack …

      We could kiss our keisters goodbye.

      It crosses my mind that maybe the easiest way to conquer a world would be by releasing a deadly engineered virus on it. Why risk having the natives detonate nukes everywhere out of desperation and spoil the planet?

      1. The aliens outsourced it to China, it was cheaper:

         https://www.zerohedge.com/health/chinese-scientists-find-coronavirus-did-not-originate-wuhan-seafood-market

         1. BTW, the article says that the virus started circulating in November something I have been saying for well over a month.

   4. This left-right thing is dead. Millions of people who voted for Obama twice are about to vote for the President a second time.

      Millions of Trump supporters and millions of Bernie backers have this in common: hatred for the oligarchy, it’s neoliberal economic model, and its Republicrat duopoly Establishment that has been deep-dicking them for at least a generation. Millions of former sheeple are throwing off the false red/blue paradigm and seeing what the real enemy is: globalism. And they’re giving The Finger to the oligarchy’s Establishment political toadies who control both parties.

      1. What he said.

7. “But zombie ideas can’t be killed by evidence. Perpetrators of the liberals-did-it lie are still out there, still getting space to spread their disinformation in mainstream media.”

   You can’t rerun history without the overwhelming footprint of zombiefied, too-big-to-fail Government Sponsored Enterprises to see how things would have turned out differently.

   1. Realtors are liars.

      1. … and every closing a crime scene.

8. Coming $oon! … (I$ we there yet?) + (do bad.bugs only thrive on Crui$e.ship$?)

   TRAVEL HOTEL$:

   Hilton Will Open a $4.3 Billion$ Mega-Re$ort in Las Vega$ Next Year
   It’s a 3,500-room gambling mecca that’s fit for Las Vegas royalty.

   RobbReport |BY RACHEL CORMACK |FEBRUARY 21, 2020

   Seasoned Strip-goers will remember the original Las Vegas Hilton. The enormous resort sheltered the revelers of Sin City for decades, til it switched hands in 2012. Now, the hotel chain is rolling the dice with one helluva comeback plan.

   Hilton Worldwide Holdings Inc. has partnered with Resorts World Las Vegas to design a sprawling $4.3 billion mega-resort that marks the largest multi-brand deal in Hilton’s history.

   Slated to open in the summer of 2021, the development will bring together three top-tier Hilton brands into one expansive 3,500-room luxury resort that’s fit for Las Vegas royalty. There’ll be a 1,700-room hotel dubbed the Las Vegas Hilton, a 1,500-room Conrad and a smaller property designed for high-rollers.

   So, what can guests expect? In addition to oversized contemporary suites, there will be facilities like a 5,000-seat theater—perfect for hosting A-list celebrity residencies and corporate events—a 220,000-square-foot outdoor complex with seven pool experiences, a high-tech spa and fitness center, plus an extensive collection of casual and fine-dining restaurants and bars.

   In true Vegas fashion, the resort will also feature games aplenty. You can hit the tables at a next-generation 110,000-square-foot casino complete with slots, table games, high-limit gaming areas, private gaming salons, dedicated poker rooms, as well as a 14,000-square-foot “Entertainment Zone” which includes a race and sportsbook and featured live entertainment. Effectively, you have all the fun and color of the Strip in one space.

   Building for the new Resorts World Las Vegas has already kicked off—it’s now one of the largest hotel construction sites currently in the country—with approximately 2,200 construction workers chipping away on the 88-acre site each day. The hotel is due to be completed by the end of next year, which gives you plenty of time to get your Vegas crew ready.!!

9. ‘The ‘fear of missing out’ that set the Greater Toronto Area’s real estate market ablaze in early 2017 appears to have flared up again in 2020. First-time buyers are competing vigorously for one-bedroom and two-bedroom units at prices up to $1-million…‘It feels a lot like 2017’

   ‘The number of first-home buyers jumping into the market and how much they are prepared to borrow has soared in recent months, as Sydney prices continue to rebound. ‘There’s definitely a fear of missing out,’ said Tom Scarpignato of Belle Property Neutral Bay. ‘There are people who are feeling like they’ve missed the boat or are going to if they don’t purchase straight away. I don’t know where that’s come from’

   It’s government and central bank policy Tom. We don’t need to debate that anymore. Both Canada and Australia pulled the rug on speculators and some in power are trying to gin it up again. But you know I’m not so sure how real this is. Two days ago we read there were no luxury sales in Vancouver. Does that sound like a fear of missing out?

   Let me list a few of the craters I don’t have time to post anymore cuz I’m looking at pre-foreclosures all day.

   ‘as has been the long-developing trend, supply issues aren’t equal across the nation – several markets, particularly in the Prairies and parts of eastern Canada, can actually still be considered buyers’ markets.’

   ‘Said CREA President Jason Stephen, “Home price growth continues to pick up in housing markets where listings are in short supply, particularly in southern, central, and eastern Ontario. Meanwhile, ample supply across the Prairies and in Newfoundland and Labrador is resulting in ongoing competition among sellers.”

   https://torontostoreys.com/canadian-home-sales-january-crea/

   Ample supply?

   1. ‘Edmonton’s apartment market – Chaput says although there is some talk of oversupply of apartment units in downtown Edmonton, there are few projects with shovels in the ground.“There will be a good two-year window before we see the next wave of development,” he says.’

      https://renx.ca/landmark-edmonton-tower-apartments-building-for-sale/

      ‘Sluggish sales conditions have generated downward pressure on home values in recent years. The median resale value in the Northeast came in at $301,000 during the first five months was essentially unchanged in 2019 at $268,000. Broadly, the housing market remains weak. Housing sales-to-listings conditions in the northeast, proxied by the Northern Lights real estate board region, and the B.C. Northern board area point to prevalence of a buyers’ market.’

      https://www.alaskahighwaynews.ca/business/site-c-filling-gaps-in-subdued-resource-economy-1.24072351

      ‘The average value of Regina’s homes has suffered a roughly 13% drop since 2015, according to data from the Canadian Real Estate Association. From the $286,700 level seen in January 2015, Regina’s benchmark home price across all housing types declined to $249,800 as of this January. During this five-year interval, the peak was established on May 2016, with a $304,200 benchmark.’

      ‘To compare, Saskatoon home values saw a drop of around 9% over the same time frame, from the $312,800 in January 2015 to $286,500 in January 2020. Both markets continue to struggle with less-than-stellar activity levels, however. Regina’s aggregate home price weakened by 2.8% year-over-year during Q4 2019, falling to $314,937. The 1.2% increase in the median price of two-storey homes (up to $387,892) proved insufficient to make up for sluggish performances in the bungalow (down 4.6% year-over-year to $286,402) and condo (down a massive 15% to $200,261) segments.’

      “Resale two-storey homes were struggling to compete against new build homes in 2018 as builders reduced prices to encourage sales,” Royal LePage Regina Realty managing partner Mike Duggleby explained at the time.’

      https://www.mortgagebrokernews.ca/news/regina-homes-have-largely-decreased-in-value-since-2015-326402.aspx

   2. “cuz I’m looking at pre-foreclosures all day.”

      It’s like that auto loan article posted the other day. Record high delinquencies (for years!), but anyone who can walk into a dealership can still get a loan. So foreclosures can skyrocket but the lending doesn’t stop.

      Krugman et al are obsessed with this idea that panic/credit freezing up causes the bust, not the bubble itself. He’s still talking about it in 2020: “when the bubble burst, much of the financial system just froze up.” We’re living in the midst of their experiment to see what happens if a bubble bursts but credit continues to flow no matter how many defaults pile up.

      1. It’s like that auto loan article posted the other day. Record high delinquencies (for years!), but anyone who can walk into a dealership can still get a loan. So foreclosures can skyrocket but the lending doesn’t stop.

         See the following article you posted yesterday. Apparently the central banks think that the only mistake they made last time was not opening the liquidity flood gates large enough, soon enough. This everything bubble will go out with an absolutely spectacular bang. The billionaires will be fine. Not so sure about J6P.

         All-star economists urge Fed to use QE and ‘new tools’ to fight next recession — just move sooner and go bigger than crisis

         https://www.marketwatch.com/story/all-star-economists-urge-fed-to-use-qe-and-new-tools-to-fight-next-recession-just-move-sooner-and-go-bigger-than-crisis-2020-02-21

      2. It’s like that auto loan article posted the other day. Record high delinquencies (for years!), but anyone who can walk into a dealership can still get a loan.

         That last time I bought a new car (2013) I was able to get a 2% car loan from a bank (so I could take the rebates instead of the 0% factory loan). From what I read the going bank rate for a “good credit score” is in the 5% range, even though in theory interest rates are lower today. I suspect this is to cover the rising delinquencies and repos.

         I do wonder what percentage of delinquencies are at the “buy here, pay here” kind of places vs. new cars purchased at a stealership.

   3. “I’m not so sure how real this is. Two days ago we read there were no luxury sales in Vancouver. Does that sound like a fear of missing out?”

      I think the frenzy is real at the low end, but it’s also temporary and deliberately manufactured. It happens every January as new people suddenly qualify for loans and higher prices (thanks to lower standards, higher loan limits, new gov’t enticements) and compete with each other. And it only works at the low end, where the market is easier to manipulate.

      As I mentioned in an earlier post, the market I watch in LA was dead in the last half of 2019. Now, suddenly, 40% of the listings under $1mil are sale-pending. Even the worst listings are selling. Because only 20% of the inventory is under $1mil, it only took 58 new buyers to make this “frenzy” appear.

      Meanwhile, double the amount of people (114) are buying $1mil+ homes, but it doesn’t look like a frenzy at all because there is so much inventory in that category.

      Let’s say we have a central bank determined to keep the credit flowing no matter how many delinquencies occur. So what if all 58 buyers default within a year? It only takes 58 more people newly qualified to keep the churn going.

      1. I think the frenzy is real at the low end, but it’s also temporary and deliberately manufactured.

         The more expensive something is, the harder it is to sell because fewer people can afford it. Doesn’t matter if it’s a jacket, a car, a house, an rv or an outdoor grill. As a result, there’s always more competition at the entry level – that’s where the most buyers are.

10. ‘The City of St. John’s is dealing with a housing problem, but not one you might expect — too many of its affordable housing units are sitting empty. “Some of the public probably may not be aware of their existence,” said Councillor Sheilagh O’Leary as she toured through an empty three-bedroom townhouse on the west end of the city’s downtown.’

    ‘The vacancy rate is currently 19 per cent, and most of those are larger three or four-bedroom homes.’

    https://ca.news.yahoo.com/home-1-5-city-st-201156711.html

    1. Fear – of missing out!!

       ‘Winnipeg’s housing prices have fallen in line with incomes this quarter, though there might be too many houses being built in the city, according to federal data. The Canada Mortgage and Housing Corporation has downgraded Winnipeg’s risk of overvaluation from moderate to low, though it still has a concern about overbuilding.’

       “Overall, we’re seeing balanced market conditions for Winnipeg, compared to some of the other Prairie provinces,” CMHC Winnipeg analyst Heather Bowyer told the Free Press. “We’re seeing a bit of buyers’ market conditions.”

       https://www.winnipegfreepress.com/business/cmhc-sees-balanced-market-for-house-prices-but-some-overbuilding-568063422.html

       How’s this for some fear?

       ‘Crystal Creek Homes is one of four builders in Five Lakes at Rock Lake Estates participating in the Six-Figure Savings promotion. The community of Five Lakes at Rock Lake Estates in Rocky Ridge has a long name and a longer list of features and amenities not often found all in one neighbourhood.’

       That’s why Seema and Sunil Sarda thought they struck it rich when they decided to build their first home in Five Lakes, a Decker Management community in northwest Calgary.’

       ‘Along with Duri Homes, Lupi Luxury Homes and New West Custom Concepts, Crystal Creek is participating in a six-figure savings promotion with the developer. It’s a limited time price reduction of up to six figures, with the cost shared by the builder and developer. It expires on March 31 or when the current two-lot offering per builder is sold, whichever comes first. The promotion is enough of a leg up to help some new home buyers qualify for financing and get under the million dollar threshhold.’

       “This promotion brings extreme value not seen before in a northwest estate community. It would be very advantageous for a buyer to move forward before time runs out,” McGregor emphasizes.’

       https://calgaryherald.com/sponsored/homes-sponsored/location-amenities-have-couple-singing-praises-of-five-lakes-at-rock-lake-estates

    2. These central bankers couldn’t run a lemonade stand, let alone an entire economy. It’s time for fire these fawkers and send them off to prison.

       1. Christine “Leatherface” LeGarde, head of the IMF, literally would be disqualified to get a job as a 7/11 cashier due to her felony fraud conviction. Yet she’s the “banker to the central bankers.” Go figure.

          1. From what I have read, she was convicted of negligence, not felony fraud. Not saying she isn’t a crook, just that she was not convicted of felony fraud.

11. Most people do not realize it but peak Texas shale production has been reached. You cannot produce oil at a loss forever. Of course, higher prices can result in even more jobs in Texas since you will have to drill many more wells to get the same production now that the best acreage has been drilled out:
    https://www.rrc.state.tx.us/oil-gas/research-and-statistics/production-data/texas-monthly-oil-gas-production/

    1. The banks and “investors” that financed the shale boom with junk bonds must be soiling their drawers as oil prices continue to sink and shale play debts mount.

12. The Communist got in bed with the Globalist, so now we have Commie Sanders verses Globalist Bloomberg.

    Can it be any clearer what are the major forces in play today.

    It might be true that the Black Swan event that will change everything is the Coronavirus.

    1. REALTOR, I have so much money left after “throwing money away on rent” every month that I don’t know where to throw it.

       1. I’ve been renting for 6 years, both in Seattle, WA and Portland, OR. I’m not as familiar with the Seattle market, but I pay much less in rent in Portland then even if I would have bought a house in 2015 when I moved here, and that is with a 20% down payment and low interest rate. My rent has ticked up a bit, but I’m still paying below market rent.

          My neighbor, on the other hand, bought his house with a low down payment a couple of years prior to when I moved here, closer to the bottom of the market. He is going through a divorce, and asked me if he should consider renting his house. His mortgage payment—not including property taxes, maintenance, etc—is significantly more than the rental value of his house. Of course, he used his house as an ATM when the roof needed to be repaired, and can’t afford to sell the house.

          1. So much WIN happening in this post.

             As for your neighbor, low down payment, divorce, using house as an ATM, can’t rent it for more than the mortgage payment, it’s almost as if there’s a pattern here:

             A pattern of Incalculable Losses.

          2. “He is going through a divorce…”

             That’ll add to the GDP.

          3. Another cuck gets fleeced. Yawn.

             1. I am kind of surprised that any guy still gets married.

    2. The Communist got in bed with the Globalist

       They have exactly the same goal.

       1. Communists from their inception were financed by the globalists and served as their cats-paws. Do a little research on who funded Lenin’s Bolshevik revolution.

          1. Excerpt from The Creature from Jekyll Island:

             http://www.wildboar.net/multilingual/easterneuropean/russian/literature/articles/whofinanced/whofinancedleninandtrotsky.html

             1. Entire book online: https://archive.org/details/TheCreatureFromJekyllIslandByG.EdwardGriffin/mode/2up

13. I cannot figure out why coronavirus continues to spread in Chinese “hospitals”. sarcasm to the max:

    https://www.shine.cn/news/nation/2002232691/

    1. For Whom The Bell Tolls · Metallica

    2. Dead link.

       1. I guess the Chinese figured out it did not put them in a positive light.

    3. The censors shut down your link.

       Oops!
       You are looking for something that doesn’t exist on this planet.

       Go back to the Earth

14. Hows this for some FOMO Australia?

    ‘Areas such as Sydney’s Mascot and Olympic Park have not only been hit with oversupply but also affected by reputational damage from the highly-publicised structural issues found in Opal and Mascot Towers that resulted in evacuations.’

    ‘Apartment prices fell 4.6 per cent in Mascot and 9.3 per cent in Homebush West, according to Domain’s latest House Price Report, and apartment sales dropped by 75 per cent after the Opal Tower scandal. “What we are seeing is that new units in high-supply suburbs either resulted in a loss or underperformed the market, even during periods of strong price increases,” he said. “The recent downturn is not the major factor in those losses – even ignoring the recent downturn and then recovery, they are still materially underperforming the market.”

    ‘A look back: ‘A quiet haemorrhaging’: After Opal, Mascot Towers where to next for apartment owners’

    ‘At one and the same time, approvals of high-rise dwelling approvals are rising the same time as the risk of buying off-the-plan apartments. “The point is the risks are very tangible, they have been realised and we have witnessed major price reductions in a number of areas with oversupply,” Peleg said.’

    https://au.finance.yahoo.com/news/danger-zones-2020-194221752.html

    WA? ‘major price reductions in a number of areas with oversupply’

    But Australia is red-hot?

    1. ‘A 30 per cent drop in building approvals in the past 12 months has led to calls from the Queensland building sector for the state government to increase its first home owners’ grant to $20,000 in the next state budget.’

       ‘The ABS figures show the number of units built in greater Brisbane have dropped by almost half, possibly correcting a glut of units built over the past four years.’

       https://www.brisbanetimes.com.au/national/queensland/builders-urge-queensland-stimulus-package-as-approvals-slump-20200211-p53zuw.html

       Glut? I’m losing that fear of missing out Australia. Maybe it’s a bunch of REIC horse-hockey!

       1. ‘As Australia’s market continues to show strong signs of growth in 2020, commentary around it becoming unsustainable continues to rise. However, while Sydney’s housing market has shown signs of being a bubble in the past, Ms Owen suggested regulators have stopped this.’

          “I think it’s fair to say we did kind of have bubble conditions specifically in the house segment of the Sydney market. And then, a sort of drop of about 17 per cent.” “It is back up but not quite to where it was at the peak of its cycle. And a lot of that was because there was a high concentration of investment in that market, but also a high concentration of potentially risky lending, namely in the form of high levels of interest-only loans,” she explained.’

          https://www.smartpropertyinvestment.com.au/buying/20616-what-does-2020-have-in-store-for-property-investors

          ‘It is back up but not quite to where it was at the peak of its cycle’

          This is where the lie is. This 3% bump, if it is real which I doubt (the MIX!!) means nothing if peak buyers took an 14% ass-pounding. And some areas were down over 30%. Note they don’t talk about specifics like that. This is more REIC shenanigans to stampede first time buyers off the cliff, with government and central bank assistance. If it’s to the moon Alice, how come I can find articles about crater day in and day out? Even inside Sydney.

          1. Sydney even?

             ‘A steady stream of new apartments and houses has increased consumer choice and weighed on rents.Renters in Darwin and Sydney had the most to cheer about.’

             ‘The Northern Territory capital saw rents fall 1.5 per cent over the quarter and 6.6 per cent over the 12 months to December 30, 2019, while Sydney saw falls of 0.3 per cent over the quarter and 0.8 per cent year on year.’

             ‘Riskwise Property Research CEO Doron Peleg attributed Sydney’s falling rents to the flood of new apartments coming onto the market.’

             ‘Although building completions are declining and the pipeline of future projects shrinking, Sydney still has plenty of excess stock that’s yet to be absorbed, Mr Peleg said. This means renters have greater choice and investors must lower rents to lure in new tenants.’

             https://thenewdaily.com.au/finance/property/2020/01/30/oversupply-cheap-rents/

             1. Well now I’m really losing the FOMO:

                ‘When purchasing an investment property, there are many common mistakes which can be made, with some being quite difficult to reverse. To avoid making the wrong decision, West Real Estate spoke to a number of industry experts, who provided strategic ways to invest in property.’

                ‘Momentum Wealth Buyer Agency Team Leader Emma Everett said it was common to see a buyer’s emotions drive their decisions. “For first-time investors particularly, and especially in cases where a property is attracting high levels of buyer competition, it’s easy to let emotions drive the buying decision,” she said. “This can lead to overpaying for a property beyond its worth or overlooking red flags, which could hold back the property’s longer-term performance and lead to unforeseen costs further down the line.”

                ‘Ms Everett said as market conditions improved it was common to see investors get carried away with a bargain hunting mentality and overlook a property’s long-term potential.’

                “Buyers looking to take advantage of market improvements need to target areas with the right growth principles in place, paying close attention to fundamentals such as demand and supply, local amenity and upcoming infrastructure, as well as micro-factors such as which property types are in high demand in that particular area and a property’s individual potential,” she said.’

                ‘As for experienced buyers, Ms Everett said they should avoid purchasing properties in hyper-inflated markets, where rising buyer competition and demand had already pushed prices upwards, and in some cases, beyond the area’s true value.’

                ‘Momentum Wealth Finance Team Leader Caylum Merrick said from a financial perspective, there was a lot of experienced buyers overlooking the importance of loan structure to their ability to expand their portfolio.’

                “We get a lot of buyers approach us who, often unbeknownst to them, have had their loans cross-collateralised or set up unfavourably by a previous lender, and are now unable to access the equity they need to progress with a further purchase,” he said.’

                “Especially for more experienced buyers who will often have more complex financial needs, having their loans correctly structured can be critical in giving them the flexibility to move forward with their investment goals.”

                ‘RiskWise Property Research Chief Executive Officer Doron Peleg said off-the-plan units, especially in areas of over-supply, topped the list for potential investment disasters.’

                “The first and most obvious is the risk of oversupply which creates weakness in the market leading to lower valuations, rising defaults on settlements, major discounting, falling rents and ridiculous incentives to get buyers across the line,” he said.’

                “The widespread oversupply issue is universally acknowledged by banks, which have blacklists for postcodes suffering potential unit saturation. In addition, lenders are scrutinising loan applications much more vigorously and either require a much higher deposit as security or they may turn down the application entirely.”

                https://thewest.com.au/lifestyle/real-estate/learn-from-others-mistakes-c-702028

                Areas of over-supply topped the list for potential investment disasters? Gosh…

15. No home payments due, no foreclosures, wait until Warren hears about this it will be her new campaign promise:

    https://www.shine.cn/biz/economy/2002232674/

    1. When bubble 2.0 crashes, you will be hearing a lot about eminent domain for underwater mortgages.

16. Maybee AZ will have a “$uper.Bloom” this year!

    Tempe’$ 600 $quare-foot micro home$ get underway; boast$ affordability

    PAULINA PINEDA | THE REPUBLIC | AZCENTRAL.COM |Feb. 20, 2020

    Homeowner$ also will be required to pay $135 per month toward HOA and land lea$e fee$.

    The homes are part of a Community Land Trust, which ensures the homes remain affordable in perpetuity and that homeowners can’t sell them for a large profit.

    Tempe Micro Estates will be built on three vacant lots near Rita Lane and Spence Avenue, which Tempe purcha$ed with federal fund$ to $pur the development of affordable hou$ing.

    First-time homebuyers Leslie Debusk and Marina Copeland looked at condos in the Tempe area but said they were too expensive for the size and that the homes didn’t provide enough privacy.

    Long interested in living in a tiny home because of low maintenance costs and the smaller ecological footprint, Debusk and Copeland said they couldn’t justify buying a larger but cheaper home in the suburbs for just the two of them.

    So a community of 13 small homes — 600-square-foot each — planned in the Jen Tilly Terrace neighborhood in north Tempe intrigued them.

    The couple, who have been married five years and live in a rental near the Tempe-Mesa border, were among the first in line last fall to apply to purchase one of the homes in Tempe Micro Estates, as the project is called.

    Newtown Community Development Corporation, a Tempe-based nonprofit, is building the homes in a partnership with the city to provide more affordable housing options.

    Prices for the micro homes are still being finalized but will likely be between $165,000 and $215,000 depending on the homeowner’s income, according to Stephanie Brewer, the deputy director of Newtown.

    “This isn’t the solution, but it is a solution to affordable housing and workforce housing issues,” Tempe Vice Mayor Lauren Kuby said.

    The homes will be sold for below market value, said Allen Carlson, Newtown’s executive director.

    About half the homes will be available for people making less than 80% of the area’s median income, which is $46,650 for a two-person household.

    Prices are still being finalized but Newtown estimates that homes will be between $165,000 and $185,000 for the lower income homeowners, Brewer said.

    Prices will be more for those with higher incomes. Current estimates are between $200,000 and $215,000, but that could change, she said.

    The homes will feature energy efficient lighting and appliances, solar power and locally-sourced construction materials.

    Each home will face a central courtyard where residents can manage their own kitchen garden.

    Residents will have access to a 900-square-foot community building with a kitchen, laundry room, book and game library and tool shed.

    The idea is to create a sense of community, which is one aspect of the Micro Estates that attracted Debusk and Copeland.

    1. Isn’t tiny home a euphemism for trailer?

    2. This is BS.
       Condos “don’t provide enough privacy?” Well suck it up and deal with sharing walls, because that’s what you get if attached product is all you can afford. I did it for 18+ years.

       You want to live with less maintenance and a smaller ecological footprint? That’s what apartments do. Much smaller surface area to lose energy.

       “energy efficient lighting and appliances, solar power and locally-sourced construction materials.” <– Make-work pork for connected businesses.

       And correct my math, but a $165K house for a $46K income is 3.5x income. That's still a little dicey, especially at lower incomes.

       And yes, it's a trailer park. Why can't they just build a trailer park and be done with it?

17. What ever happened to the Mel Watt sexual harassment investigation? The media was too busy going after Kavanaugh that they gave Mel Watt, an Obama appointee, a pass.

    I think it’s funny how the left has a constant fear that, if the gooberment doesn’t get involved, poor people won’t be able to afford buying shacks. So they force banks to lend to people with poor credit history, no savings, no consistent job history, and no documentation to back any of it up. The irony is that, there has been so much gooberment involvement and housing subsidies that housing is no longer affordable for pretty much everyone where I live.

    1. Housing regulator settles sexual harassment suit tied to Mel Watt – POLITICO
       https://www.politico.com/news/2019/09/27/mel-watt-sexual-harassment-suit-006249

       (snip)

       The Federal Housing Finance Agency has reached a settlement with an employee who accused former Director Mel Watt of sexual harassment, ending a 16-month saga that spawned three government investigations and an eight-hour congressional hearing.

       The terms of the settlement were not made public, but FHFA special adviser Simone Grimes, who sued the agency for $1 million last year, said she was happy with the resolution of her claims against Watt.

18. Don’t like the “dry.heat” in AZ, how’$ ’bout some moist.swirling heat in Florida?

    (Buy or rent, it’$ still a $helter.$hack.$teal!)

    A New Tiny House Village Just Opened in the Florida Keys, So It’s Time to Book a Vacation!

    apartment.therapy | by Stephanie Trovato

    Have you dreamed of downsizing and becoming a sustainable tiny house owner but aren’t sure you’re ready to commit longterm? Well, there’s now a way to try this lifestyle out in the Florida Keys, giving you a real feel for what you are getting into at this tiny house village.

    Last month, Petite Retreats announced they officially opened the Sunshine Key Tiny House Village. Located about 30 minutes away from Key West on Ohio Key, this charming retreat sits on the shoreline of Sunshine Key RV Resort and Marina, which is on the south end of the Seven Mile Bridge.

    Guests can choose from five tiny homes, each with their own distinct decor and color scheme: Kai, Lucy, Isla, Pearl, and Hemingway. Each is under 350 square feet and standard amenities like a refrigerator, cookware, coffeemaker, TV, and a outdoor picnic table are included. Additionally, each tiny house offers lofts, decks, an open-air feel, and waterfront views. Rates for staying at one of these adorable abodes start at $250 per night.

    Petite Retreats offers a collection of unique vacation accommodations across the U.S, from the Arizona desert to the hills of New Hampshire;

19. Seattle, WA Housing Prices Crater 13% YOY As Demand Plummets On Skyrocketing Inventory

    https://www.zillow.com/seattle-wa-98102/home-values/

    *Select price from dropdown menu on first chart

    As a leading economist advises, “Mortgage debt is the most toxic and damaging debt of all. Avoid it at all costs.”

20. ‘So let’s start with the origins of the 2008 financial crisis, a topic that remains relevant if we want to avoid repeating past mistakes’

    This is the guy who openly called for another bubble.

    It wasn’t long after the idea of a housing bubble went from laughed off conspiracy theory to undeniable fact, the media and whoever controls it started to twist it into something that suited their interests. I was thinking of one example that shows what it is in very simple terms.

    In 2003 I was working 6 months on-off in Texas. I ended up in Sedona AZ that fall. I got to know several people and noticed most were former Californians! who talked about shack gambling mostly. The locals did too as they all seemed to have stars in their eyes about Sedona and were raking it in one way or another. The Verde Valley, not so much at the time even though it’s just down the road.

    One evening somebody mentioned Cornville. Laughs all around! Why it’s mobile homes with tires on the roofs and Arizona red-necks inside I was told. So eventually I head back to Texas, promising to return the next fall. And I did.

    I get back and Cornville is a gold mine! And the Verde Valley and any other two lane middle of nowhere gathering of shacks, mobile or otherwise. And that readers is what a mania is.

    1. https://www.businesspost.ie/ireland/the-luxury-gap-hundreds-of-high-end-apartments-lying-empty-across-dublin-ac7da06c

    2. Krugman recently fell for an obvious email phishing scam and made it public on Tweeter. He is very good at seeming smart, but in reality there may not be a whole lot going on upstairs.

       1. For what it’s worth, he wrote enough papers for top economic journals to get tenure at Princeton.

          1. Which is amazing for somebody as foolish as he is. I remember his article titled something like “why crude oil is not in a bubble” when the price was like $135. It popped in amazing fashion.

             1. You don’t actually need to know squat about how the real world economy works to get an academic publication.

21. Biden’s last hope is fading fast:
    https://www.breitbart.com/politics/2020/02/23/joe-bidens-south-carolina-firewall-is-on-fire/

    1. “A realtor from the East Side of Providence faces up to 30 years in prison after his conviction for attempting to entice a 10-year-old girl into sexual activity, law enforcement officials announced Tuesday.

       Thomas McLucky Hammond, 52, was convicted Friday of one count of attempting to persuade, entice, induce or coerce a minor to engage in illicit sexual activity, according to a news release from U.S. Attorney Aaron L. Weisman.

       Prosecutors said that in June 2017, Hammond responded to an advertisement in the “casual encounters” section of Craigslist.com, and over three days he communicated with a man he thought to be the stepfather of a 10-year-old girl in Warwick. Hammond asked the man if he was sexually abusing the girl and proposed joining in the abuse at a pool party at the family’s home.”

       https://www.providencejournal.com/news/20190813/providence-realtor-convicted-of-seeking-sex-with-10-year-old-girl

    2. https://nationalfile.com/video-msnbcs-chris-matthews-after-years-of-trump-bashing-now-fears-a-bernie-led-democrat-party/

       1. I wonder if the DNC will steal it away from Bernie again like they did the last time?

          On a personal note, I recall my amazement in 2016 when all of my sisters, who were by nature among the most inevitable Hillary Clinton supporters, all lined up behind Bernie, only to see him get torpedoed by the party he represented.

       2. It would be humorous, if not for the possibility that Sanders could become the next president, that the progs unwittingly created the monster they fear so much. What did they expect to happen after decades of indoctrinating people as early as preschool into the glory of Leftism? Were they expecting new generations of Walter Mondale Democrats?

          1. “Richard Jones, the owner and broker of Century 21 Herbertsville Real Estate, was indicted Jan. 9, according to the Monmouth County Prosecutor’s Office. According to a copy of the indictment obtained by Brick Shorebeat, grand jurors indicted Jones on a single count of attempted sexual assault of a juvenile older than 13 but younger than 16.

             Jones was arrested Sept. 26 in Asbury Park after attempting to use a local prostitute to facilitate a meeting to have sexual intercourse with a 14-year-old girl, authorities said at the time. Jones, officials said, arrived at an agreed-upon location where he was met by police, after pre-arranging to meet with the 14-year-old girl, who was actually an undercover police officer.”

             http://brick.shorebeat.com/2015/01/brick-realtor-indicted-for-attempted-sex-assault-on-teen/

             1. Is this supposed to be news, given that the subject of the story is a used home seller?

             2. You’re a renter. Better you keep saving and investing money and adding to your collection of rare instruments than give a dime to the depravity of REALTOR.

          2. What did they expect to happen after decades of indoctrinating people as early as preschool into the glory of Leftism? Were they expecting new generations of Walter Mondale Democrats?

             They don’t know what they want. They just know what they don’t want.

          3. It has more to do with billionaire oligarchs looting the economy than it does indoctrination.

             1. Agreed, but then they should have indoctrinated the kids into the joy of globalism and why it’s glorious when oligarchs take everything and leave them stuck with no jobs and non dischargeable student loans.

       3. I love watching Real Journalists have meltdowns as Bernie keeps going from strength to strength, routing the corporate stooges the Oligopoly has anointed to be our “choices.”

          1. Indeed, although I worry that our active suffrage could be revoked because the wrong candidates are winning.

    3. Biden’s last hope is fading fast:

       Biden keeps blathering about everything “me and Obama” did. Like blacks who are priced out of affordable housing by Wall Street vulture funds, are seeing their wages driven down by a horde of Democrat-on-Arrival illegals, and have seen our manufacturing base exported to China and Mexico are supposed to be grateful?

       1. When the benefactors realize that he is toast the mother’s milk will dry-up.

    4. Why is all the chatter about Biden quitting,when he’s second to Bernie? How about Fauxahontas, Klobuchar or Butt giving up?

       1. Who will get Biden’s delegates?

          1. Will the same person get both of them?

22. And as it happens, the experience of Europe, and Spain in particular, provides some of the bullets

    Spain is the poster child of the fiction economy: socialist government, no jobs, living off of EU handouts. They aren’t building ghost airports or condos there anymore because they are so broke that they are giving Greece a run for the title of Europe’s basket case.

    1. The solution is simple, and that is for Spain to leave the EU. Why would any country voluntarily allow itself to be looted by German banks?

23. Dumb question of the day:

    Has the coronavirus outbreak overwhelmed the plunge protection authorities’ ability to prop up stock markets?

    It kind of seems to be the case: Despite the Fed’s and Chinese central bank’s announcements that they stood ready to support equities, prices nonetheless fell sharply last week.

    1. February 21, 2020 – 11:10 AM EST
       Coronavirus could lead to stock correction: Goldman Sachs
       By Niv Elis
       The spread of the coronavirus could portend a stock market dip, according to a Goldman Sachs analysis.

       The stock market has continued to reach new highs despite the spread of the deadly virus, but that trend may not continue, warns Goldman Sachs analyst Peter Oppenheimer.

       In the near term “we believe the greater risk is that the impact of the coronavirus on earnings may well be underestimated in current stock prices, suggesting that the risks of a correction are high,” he wrote in the analysis released Wednesday.
       …

    2. prices nonetheless fell sharply last week

       I think the panic will really set in when retailers’ shelve become bare. Imagine going to the pharmacy to fill a prescription for Amoxicillin or Augmentin or whatever it is you need and being told they are out and nothing is scheduled for delivery.

       Though I suppose that the Chicoms might reopen the factories, the virus be damned.

       1. Not that I trust the IMF but what is going on in China shows both the strength and the weaknesses of a totalitarian regime. On one hand the regime allowed a virus to escape from a lab and for two months it allowed it to spread by not admitting the problem and dealing with it. However, now they are willing to allow thousands to die unnecessarily to get their economy going by throwing thousands into quarantine without proper safeguards to prevent transmission and inadequate healthcare.

          https://www.shine.cn/biz/economy/2002232647/

          1. Repeating a conspiracy theory over and over again does not make it come true.

             Inside the Chinese lab poised to study world’s most dangerous pathogens
             Maximum-security biolab is part of plan to build network of BSL-4 facilities across China.
             Editors’ note, January 2020: Many stories have promoted an unverified theory that the Wuhan lab discussed in this article played a role in the coronavirus outbreak that began in December 2019. Nature knows of no evidence that this is true; scientists believe the most likely source of the coronavirus to be an animal market.
             David Cyranoski
             22 February 2017
             Updated: 23 February 2017
             Wuhan, China
             …

             1. Nature knows of no evidence that this is true;

                A youtube video popped up in my feed yesterday by Canadian Prepper about coming supply shortages.

                The interesting part was the later half of it – discussing why it is in the government’s interest to keep a lid on declaring a full panic and rather ease the country in to the situation and it actually made a lot of sense – we don’t have the infrastructure or preperations to activate ‘oh s*it! Panic!’ mode overnight and the consequences of everyone panicking if we did would overwhelm the system.

                I think the same idea applies if the government knew the virus came from a weapons lab – that the population might go into a full panic far in excess of what the virus warrants.

             2. Your denial has two dates of 2017 which reduces its credibility, denying a fact over and over again does not make it untrue either. If this was an animal transmission, China would not have spent two months covering it up before it asked for global help.

             3. it is in the government’s interest to keep a lid on declaring a full panic and rather ease the country in to the situation and it actually made a lot of sense – we don’t have the infrastructure or preperations to activate ‘oh s*it! Panic!’ mode overnight and the consequences of everyone panicking if we did would overwhelm the system.

                You can thank the offshoring of our supply chains and the “just in time” (never on time) inventory model. The oligarchs screwed us way worse than most people know, and we’re about to pay bigly.

             4. “Your denial has two dates of 2017 which reduces its credibility,…”

                Not really. It’s not my denial, and I can’t fix date errors on the Nature magazine web page.

             5. You can thank the offshoring of our supply chains and the “just in time” (never on time) inventory model. The oligarchs screwed us way worse than most people know, and we’re about to pay bigly.

                That was one of things pointed out in the video, and in a pretty fair way – We’ve been too busy optimizing (for profit) and have very, very little resiliency in our support systems if something suddenly goes very wrong. To that end, he makes the argument that given what resources we do have, easing into the situation over time is better for society as a whole than going to Defcon 1 right away. Of course he’s also encouraging to prepare ahead of the masses.

             6. animal market

                Global Times: New Chinese study indicates novel coronavirus did not originate in Huanan seafood market

             7. I posted that 2017 Nature article before it had that editors’ note. Convenient they left the day off of that date.

       2. From shine link:

          International Monetary Fund Managing Director Kristalina Georgieva said on Saturday that she expects China’s economy to “return to normal in the second quarter” of 2020.
          “The Chinese authorities are working to mitigate the negative impact (of COVID-19) on the economy,” Georgieva said, adding that she “had an excellent discussion” with Chinese senior officials.
          “In our current baseline scenario, announced policies are implemented and China’s economy would return to normal in the second quarter,” Georgieva said.
          “As a result, the impact on the world economy would be relatively minor and short-lived,” she said at the G20 Finance Ministers and Central Bank Governors Meeting.

          1. How can you possibly place any confidence in such predictions, given no evidence that the outbreak has begun to be contained.

             1. “How can you possibly place any confidence in such predictions, given no evidence that the outbreak has begun to be contained.”

                That is your opinion. I see plenty of signs it is being contained but you have to really looks at the numbers and know how to interpret them. The declining death rate outside of Wuhan is the most positive.

             2. you have to really looks at the numbers and know how to interpret them

                Hard to imagine a more absurdly arrogant statement.

             3. “I see plenty of signs it is being contained…”

                I see plenty of signs you will soon enjoy an unlimited number of crow dinners, similar to when you wouldn’t back off your prediction for $80/bbl oil several years ago.

                Energy
                Oil slides nearly 1% on renewed fears over toll from coronavirus
                Published Thu, Feb 20 2020 9:16 PM EST
                Updated Fri, Feb 21 2020 2:36 PM EST

                Oil prices fell nearly 1% on Friday on renewed concerns about crude demand being pinched by the economic impact of the coronavirus outbreak, while leading producers appeared to be in no rush to curb output.

                The latest signs of infections outside the Hubei province epicentre in China spurred a selloff across financial markets, as G20 policymakers travelled to Saudi Arabia for talks on the global economy.

                Brent crude was down 1.4%, at $58.46 a barrel, while U.S. crude dropped 0.9%, at $53.38 a barrel.
                …

             4. The crude is a cratering.

                U.S. stock futures sink on growing concern of outbreak’s economic impact
                By Mike Murphy
                Published: Feb 23, 2020 8:21 p.m. ET
                Dow futures drop more than 300 points; crude prices sink 2%
                …

    3. “Has the coronavirus outbreak overwhelmed the plunge protection authorities’ ability to prop up stock markets?”

       Insert another zero or two, and then press ENTER. Easy!

    4. “Dumb question of the day:”
       “Has the coronavirus outbreak overwhelmed the plunge protection authorities’ ability to prop up stock markets?”

       – Caveat: I’m neither an economist, nor a financial “expert.” With that out of the way, here’s my opinion.

       – The Fed can (and does) goose both stock and housing markets using the policy tools available them (which BTW, many of which are totally outside of their charter), including, ZIRP and QE. This policy response is only effective when “investors” are in risk-on or “greed” mode. When they’re in risk-off or “fear” mode, Fed policies are ineffective to stimulate buying. Please reference the crashes of 2000 and 2008/9 as abject failure of Fed policy to “prevent” a collapse of stock markets after two historic financial asset bubbles. We’re now on the downside of historic financial asset bubble number three, the everything bubble; the biggest and the baddest (so far). How is it different this time, other than they’re starting from a more limited position in that rates are lower and their balance sheet is higher? This is only going to limit whatever action they may take even more that the last two crises.

       https://twitter.com/Not_Jim_Cramer/status/832718086302101504
       Not Jim Cramer | @Not_Jim_Cramer
       “The Panic of 1907 was so severe that it led to the creation of the Federal Reserve. Amen.”
       See chart:
       1907 Panic (pre-Fed): DJIA loss = -49%
       2008 Panic (post-Fed): DJIA loss = -53%

       https://www.oftwominds.com/blogfeb20/bagholders2-20.html
       When Bubbles Pop, Only the First Sellers Escape Being Bagholders
       Charles Hugh Smith
       February 21, 2020
       “Central banks have generated a mesmerizing moral-hazard propaganda field that implicitly suggests “we’ll never stocks go down again, ever!” Yet the only way central banks can causally intervene is to buy stocks directly in size, i.e. in the trillions of dollars. (Recall U.S. stocks are around $35 trillion, global stock markets about $85 trillion. Yes, buying futures contracts through proxies works in stable markets, but not so much in panic cascades of selling.)”

       “Sober up, people. All bubbles pop, and the higher the extreme, the greater the crash. Only the first sellers will escape; everyone who hesitates or “buys the dip” will be crushed at the bottom of the waterfall.”

       – The Fed balance sheet (unwind/normalization cancelled, because “everything is awesome!”), now climbing back to nearly high water mark at approx. $4T. This is approx. 1/10th of the U.S. stock market cap., and the Fed isn’t (yet) allowed to buy stocks (directly).

       – There are two primary drivers of stock markets: a) valuation and b) psychology. The Fed has driven (a) “to the moon” via manipulating (b) using Pavlovian conditioning that has “investors” BTFD and FOMO. Yes, the Fed directly manipulates “investor” psychology. “Investors” should know better.

       – The extreme valuations today are being ignored by investors for the moment as they’ve been conditioned that “the Fed has your back.” via Fed jawboning, ZIRP, QE, Repo, etc., etc., etc.

       – The global economy was already slowing in 2019 well ahead of Covid-19 pandemic. Recall the massive Fed intervention in Q4, ’18-Q1, ’19, where they completely reversed their balance sheet “normalization” activities. Now with economic reality starting to assert itself in terms lower growth and earnings, investors are (at least starting) to take notice. Once the selling gets going in earnest, there’s nothing the Fed can do to stop it. Covid-19 is only going to accelerate the downturn that was already “baked into the cake” from 10 years of massive, extreme, and unconventional Fed and other central bank policies that drove valuations and stock prices “to the moon.”

       – These general principles from value investor Benjamin Graham may become important again very soon:

       “In the short run, the [stock] market is a voting machine, but in the long run, it is a weighing machine.” – Benjamin Graham

       “An investment operation is one which, upon thorough analysis promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.” – Benjamin Graham

       Confronted with the challenge to distil the secret of sound investment into three words, we venture the motto, Margin of Safety. – Benjamin Graham

       “The individual investor should act consistently as an investor and not as a speculator.” – Benjamin Graham

       “The essence of investment management is the management of risks, not the management of returns.” – Benjamin Graham

       1. We now live in a world where bubble pop then re-inflate, training people to BTFD. Only a complete wipeout where most everybody is left penniless, thinking “boy was that stupid” will cure this disease of greed we have.

          1. We now live in a world where bubble pop then re-inflate, training people to BTFD.

             I believe that’s 100% intentional.

       2. “How is it different this time, other than they’re starting from a more limited position in that rates are lower and their balance sheet is higher?”

          On the one hand, it seems like they are getting low on ammunition, but on the other, is there really any effective limit on how low interest rates can go or how large their balance sheet can grow?

          1. “is there really any effective limit on how low interest rates can go or how large their balance sheet can grow?”

             – According to MMT, there’s no limit, however, MMT is only central banks propaganda; it’s BS. MMT policies in Weimar Germany, Zimbabwe, Venezuela, Argentina, etc. show that there are real limits. If they weren’t before, the Fed is now clearly monetizing the debt (i.e. buying U.S. Treas. with printed $). This is shown by their balance sheet never being normalized. It’s only going up from here. Add to this the U.S. national debt at $23T. The $ is toast from coast to coast. Banana republic stuff. Central bank policies are reaching the end of the road. It’s economic end-game. There will be an economic reset this time, IMHO. If we’re lucky, we’ll end central banks and return to some sort of free market system and some kind of a gold standard. If we’re not lucky, then “Viva la revolución!” Reference: John Law and the Mississippi Bubble.

             “Fiat money eventually always goes back to its intrinsic value – zero” – Voltaire

             “All the money and all the banks in Christendom cannot control credit…Gold is money and nothing else.” – JP Morgan’s 1912 Congressional testimony on “the justification of Wall Street”

             “Betting against gold is the same as betting on governments. He who bets on governments and government money bets against 6,000 years of recorded human history.” – Charles De Gaulle, Leader of the French resistance during WWII and 18th President of France

24. Does anybody know how many Americans are being monitored as possible coronavirus cases?

    1. Local News
       Hundreds in Michigan being monitored due to coronavirus
       No one monitored being quarantined
       Priya Mann, Reporter
       Natasha Dado, Web Producer
       Published: February 23, 2020, 8:01 am

       DETROIT – Hundreds of people in Michigan are being monitored because of coronavirus concerns.

       On Sunday the Michigan Department of Health and Human Services reported that it is currently monitoring 325 people.

       All of the people being monitored have been to mainland China within the past two weeks or were passengers on a cruise ship with a confirmed coronavirus case.

       No one is being quarantined. The MDHHS says that is because they were not deemed at high risk during the screening process.
       ….

       1. In the past week I saw an article somewhere about 700+ people being monitored in CA. It’s too late for containment, this thing is spreading as we type.

       2. 700, 7000, what’s a decimal place between friends?

       3. “No one is being quarantined. The MDHHS says that is because they were not deemed at high risk during the screening process.”

          WTF? It’s been pretty well-known for weeks that this virus can be transmitted by the asymptomatic. It also seems that the virus can be transmitted without close contact. Yes, most of the cases are close contact, but it doesn’t have to be. We saw that from the cruise ship and the Hong Kong apartment building with the wacked-out sewer pipes. *Everybody* is high risk. They can’t treat this like a normal flu virus.

    2. The New York Times
       ‘All Hands on Deck’: Health Workers Race to Track Thousands of Americans Amid Coronavirus

       Local health departments around the United States are scrambling to monitor thousands of people returning from travel in China and elsewhere. Among the tasks: daily calls, emails, texts.
       Local health officials check in daily by email, phone or text with the thousands of people returning to the United States from mainland China, where they may have encountered the virus.
       Credit…Tony Luong for The New York Times
       By Amy Harmon and Farah Stockman
       Feb. 22, 2020

       After a long journey at sea on the Westerdam cruise ship, which was denied entry at ports across Asia over fears of the coronavirus, Holley Rauen finally returned home to Florida on Wednesday night. Moments later, she discovered that she had joined a cast of thousands who are being meticulously tracked by local health officials across the United States.
       …

    3. America
       Washington State Monitoring 712 People for Coronavirus Symptoms
       By Zachary Stieber
       February 18, 2020
       Updated: February 18, 2020

       Hundreds of people in Washington state are under public health supervision for the novel coronavirus, state officials said on Feb. 17.

       The 712 people being monitored are at risk of having been exposed to the virus, the Washington State Department of Health said.

       “The number of people under public health supervision includes those at risk of having been exposed to Novel Coronavirus who are monitoring their health under the supervision of public health officials. This number includes close contacts of laboratory-confirmed cases, as well as people who have returned from China in the past 14 days and are included in federal quarantine guidance,” the department said in an update on its website.
       …

       1. Oops. I think this is what I saw. I said CA above. This is how rumors are started.

    4. How does revealing the number of individuals being monitored divulge confidential information? Makes no sense…

       Oregon Health Authority won’t reveal how many people are being monitored for coronavirus
       In comparison, the state of Washington posts on their public website the number of people being monitored.
       CORONAVIRUS
       Author: Pat Dooris
       Published: 9:28 PM PST February 21, 2020
       Updated: 8:04 AM PST February 22, 2020

       PORTLAND, Ore. — The Oregon Health Authority refuses to reveal how many people in the state are being monitored for the coronavirus, now called COVID-19.

       Spokesman Jonathan Modie said “there is a lot of stigma connected to the virus right now.”

       He added that withholding the total number of people monitored would “protect the privacy of the individuals we are monitoring.”
       …

       1. This guy is a real piece of work. Maybe he can get a job working for the Chinese government.

       2. It’s as Canadian Prepper said: they don’t want to cause a panic.

          1. Being kept in the dark is more reassuring than knowing there is a small number of potential cases?!

    5. This story is very not reassuring, given what is known about asymptomatic transmission.

       California tells 7,600 people to ‘self-quarantine’ because of coronavirus
       Slide 1 of 3
       FILE – In this Feb. 18, 2020, file photo a bus transporting passengers that were temporary quarantined at Marine Corps Air Station Miramar, Calif., leave the base en route to public transportation terminal locations in San Diego. California health officials said Friday, Feb. 21, 2020, that 7,600 people who have returned to the state after visiting China have been asked to quarantine themselves at home this month as health officials try to stop the spread of a new virus. (Nelvin C. Cepeda/The San Diego Union-Tribune via AP, File)
       Nextdoor
       OLGA R. RODRIGUEZ
       ASSOCIATED PRESS
       February 21, 2020, 1:27PM

       SAN FRANCISCO — California health officials said Friday that 7,600 people who returned to the state after visiting China during the outbreak of the new virus have been asked to quarantine themselves at home this month as health officials try to stop the spread of the virus.

       The people returned to the U.S. on or after Feb. 2 and are being asked to monitor their health, stay home and limit interactions with others, the California Department of Public Health said in a statement.
       …

       1. Oh yeah, that’s going to work.

       2. en route to public transportation terminal locations in San Diego

          WTH!!!

          1. Seems safe, right? LOLZ….

          2. Even if symptoms don’t arrive until 21 days, I guess the test kits work after 14 days of incubation. But there’s been a couple cases where people test negative and then test positive later. WTH is going on? How can you have enough virus to spread it but not enough to show up on a test kit? Or maybe the thing is mutating. I just don’t know.

    6. If whole town quarantines become necessary that will do a number of the stock market.

       1. Check out Italy’s rapidly evolving situation. Our resident expert’s racist prediction that only Chinese people would die from coronavirus has failed.

          The Financial Times
          Coronavirus
          Italy quarantines northern towns in coronavirus outbreak
          Number of cases tops 150 in Europe’s biggest cluster as fears grow over pace it is spreading
          Luca Zaia, governor of the Veneto region, said the last two days of the Venice carnival would be cancelled © Reuters
          Miles Johnson in Rome
          13 minutes ago

          Italy has imposed a strict quarantine across at least 10 towns as authorities in its wealthy northern regions battled to contain the largest outbreak of coronavirus outside of Asia.

          Officials said on Sunday that a third Italian had died from the virus as the infection count rose to 152, up from just three identified cases on Friday morning, raising fears that coronavirus is spreading at pace through Europe.

          The last days of the Venice Carnival and several Serie A football fixtures were cancelled. Authorities also closed schools and universities as they struggled to find the source of the outbreak. Large Italian companies, including the bank UniCredit, told employees in affected towns not to come to work.
          …

          1. 152/3 = 51 fold increase in cases over two days…

             1. PB, do you really believe that is what happened over the last two days or isn’t it far more likely after the deaths, the Italian government started to look for the mild cases? Please use some common sense.

             2. Thank heavens we have you to constantly mansplain the outbreak for us!

          2. All numbers are lagging indicators. So, the numbers are always worse than what we know.

       2. If whole town quarantines become necessary that will do a number of the stock market.

          Nah, we’re operating off a while new paradigm now.

          1. I saw an article saying that it won’t affect the US as much because so many of us can work from home. Will the work done from home have any real value if the other work can’t be performed? If I go to the grocery store and the shelves are bare, what good will it do if we can ship a code update?

             1. If I go to the grocery store and the shelves are bare, what good will it do if we can ship a code update?

                I don’t know…keep shipping code and we’ll see what happens. Be sure to keep a positive attitude. A full bank account trumps an empty stomach, right? Customers are waiting for that update, even if they are hungry too! Just save the money and eat like a king later. Someday.

                In fairness, China has managed to keep everyone fed so far. There are occasional rumors and rumblings, though.

             2. Most people cannot work from home. Most of the jobs which can be done remotely are the least necessary when times get tough.

             3. “Most people cannot work from home. Most of the jobs which can be done remotely are the least necessary when times get tough.”

                Checks billing rates for “Emergency” service call … would you like that electricity in your building back on today? Or will next Thursday work for you? LOLZ

25. $ad, … $o $ad …

    eCONomy | Market Outlook

    The Glub, Glub, Glub Of Rece$$ion Circling The Drain$

    Seeking Alpha | By David Haggith | Feb. 22, 2020

    $ummary:

    Who says there is no recession anywhere in sight.
    In short, manufacturing remains in recession; corporate profits remain in recession; freight remains deep in recession; Carmageddon remains in recession; and the Retail Apocalypse remains a recession for brick-and-mortar stores, while employment – the last holdout – is now also turning downward.

    Most financial experts have been reluctant to see recession coming, and that is not surprising since almost none of them saw the greatest recession in nearly a hundred years coming until well after it was already here.

    The manufacturing recession that everyone acknowledges as having begun last summer continues

    However, something worse just happened. The services sector of the US economy – the long hold out from recession – just fell off a cliff into recessionary

    Partially as a result of the manufacturing recession, corporate profits have been flatlining since the Trump Tax Cuts

    Calculated AFTER taxes, corporate profits got one initial bump from their tax savings when those savings kicked in, and have been flat ever since.

    Take out the adjustments that are included in the above graph, and they are negative. Fact is, there is all kinds of room for juggling in those adjustments to make things look as good as possible. As good as possible, then, is zero growth for two years.

    2019 was, in fact, the fifth consecutive year with no operating profit growth (meaning growth from actual business that excludes any bottom-line rise in “earnings” that comes purely as a result of paying out less in taxes).

    “… corporate tax cuts certainly did not increase corporate revenues enough to keep government revenue from falling”

    And, while everyone talks about Europe sliding into a recession, you can see that the US actually has a far higher percentage of its companies operating year-after-year at a loss than either Europe or Japan

    Wor$er & Wor$er:

    It’s not surprising, then, that the Cass Freight Index (truck, rail, barge, and air) that I’ve been tracking in overviews similar to this one got decidedly worse since the last time I posted a graph (worse from an already bad position)

    here we are – again having to go all the way back to the Great Recession to find numbers as dismal.

    Carmageddon is still leaving the auto industry as the worst-hit segment of manufacturing (and one of the largest segments). While profitless Tesla stocks climb like Icarus toward the sun, the rest of the automobile industry has been writhing in a recession called “Carmageddon” for more than a year.

    It’s rece$$ion everywhere … or is it depre$$ion:

    The head of the International Monetary Fund has warned that the global economy risks a return of the Great Depression, driven by inequality and financial sector instability…. “In some ways, this troubling trend is reminiscent of the early part of the 20th century – when the twin forces of technology and integration led to the first gilded age, the roaring 20s, and, ultimately, financial disaster….”

    Eric LeCompte, the head of debt charity Jubilee USA, said: “The IMF delivered a $tark me$$age about the potential for another ma$$ive financial disa$ter that we last experienced during the Great Depre$$ion.

    1. Nice post Hwy….

    2. corporate profits remain in recession

       Gee, that’s weird, the stock market is at all-time highs.

       1. $tayin’ a “True.Believer’$!” … to.thee.end = Con$tancy!

26. A reminder what Trump did for this country and what the naysayers said at the time:

    https://www.cnbc.com/2020/01/31/for-trump-administration-coronavirus-quarantine-presents-fine-balancing-act.html

    1. As long as very few people are tested, the case count will stay very low.

       1. Where are the deaths in the US PB if there are lots of untested people with the virus?

          1. “Flu” deaths? As you said, if it isn’t tested, it’s not a case.

             1. National News
                US flu outbreak eases, deaths hit 16K
                105 children have died from flu this season
                Sickness nightmare: New flu and coronavirus numbers
                By Ed Payne | February 21, 2020 at 6:48 AM HST – Updated February 21 at 10:45 AM

                ATLANTA (Gray News) – America’s flu season is still going strong but has eased a bit, the Centers for Disease Control and Prevention said Friday.

                The CDC estimates that so far this season there have been at least 29 million flu illnesses, 280,000 hospitalizations and 16,000 deaths from flu.

                This flu season has been especially bad so far for children and young adults. Their rates remain higher than in recent years.
                …

       2. The Diamond Princess cruise ship experience bodes poorly for outbreak containment.

          11 cruise ship passengers test positive for coronavirus, Nebraska hospital says
          By Nicole Chavez and Hollie Silverman, CNN
          Updated 4:30 PM ET, Fri February 21, 2020

          (CNN)
          Most of the Americans who were being monitored at the University of Nebraska Medical Center for coronavirus after evacuating a cruise ship in Japan tested positive for the virus, the hospital says.

          UNMC said in a statement Thursday that the US Centers for Disease Control and Prevention verified the Nebraska Public Health Lab results showing that 11 of the 13 patients have the novel coronavirus. The other two evacuees who were taken to the Omaha hospital tested negative, the statement said.
          …

          1. So much for “Anglos” being immune to the virus.

             1. I don’t know. Seems like manners dictate that racial background of Americans is never reported in any sort of negative story. I’ll be curious to find out if most of the Americans are descended from East Asians.

             2. The Italians and Iranians are much less likely to have Asian heritage. Mutations, maybe?

    2. “A reminder what Trump did for this country … ”

       aqdanny.boy, blah, blah, blah …

       Ye$, reminds us how dtRumpsis wants to rid us of the “evil” CDC …

       News > Medscape Medical News:

       Trump Seeks to Cut NIH, CDC Budget$, Some Medicare Spending

       Medscape | Kerry Dooley Young | February 11, 2020

       The Trump administration on Monday argued for cutting spending for a federal agency at the forefront of the efforts to combat the coronavirus, while also seeking to slow spending in certain parts of the Medicare and Medicaid programs.

       Trump Proposes 16% Cut To CDC As Global Number Of Coronavirus Infections And Deaths Rise.

       By Lisette Voytko| Forbes Staff |Business |Breaking News Reporter

       Chief critics:
       The Senate Budget Committee (led by Senator Bernie Sanders (I-Vt.) as the ranking member) said Trump’s budget would “destroy discretionary programs [by] cutting them by $1.9 trillion. These are things like Section 8, Head Start, WIC, LIHEAP, public housing, NOAA, NIH, NASA, NSF, the CDC—most of the programs that we think of when we think of what the government does.” And James Hamblin, a doctor who writes for The Atlantic, said on Twitter that the budget “doesn’t consider pandemic preparedness a matter of national security.”

27. “Although few saw 2008 coming, in retrospect it was a classic banking panic, the type of thing that happened frequently before the 1930s.”

    Wrong. It was the collapse of an era of U.S. worker being paid less and convinced to nonetheless spend more, with the difference covered by rinsing debs and inadequate retirement savings. Or it would have collapsed if the federal government had not stepped in to defer it, at the cost of making the monster even bigger.

    https://larrylittlefield.wordpress.com/2018/09/06/rising-u-s-debt-is-the-real-cause-of-the-u-s-trade-deficit-and-inequality/

28. Santa Clara, CA Housing Prices Crater 10% YOY As Defective Appraisals And Mortgages Surface Across The US

    https://www.zillow.com/santa-clara-ca-95051/home-values/

    *Select price from dropdown menu on first chart

    As one noted economist stated, “Housing prices are plunging and there is nothing you can do about it….. Nothing.”

29. “I’m in Spain right now, talking about zombie ideas — ideas that should have been killed by evidence, but just keep lurching along.

    Keynesian mouthpiece Paul Krugman will never say a word about the central role of his beloved Fed in creating gargantuan bubbles or engineered boom/bust cycles to loot and asset-strip the retail investor muppets.

30. A number of weeks ago many were pointing at Thailand as the place the virus would escape containment. However, it turns out Thailand did an outstanding job of containment. It still has only 35 cases, 21 are fully recovered and only 2 are in serious or critical condition. No one died.

    https://www.worldometers.info/coronavirus/#countries

    1. It’s too early to say. Thailand is a major Chinese tourist destination. They just decided to start activitely looking for cases, which seems quite likely to reveal more of them. Absence of evidence is not evidence of absence.

       Thailand expands virus detection
       Pneumonia cases being reviewed in eight high-tourism provinces
       published : 21 Feb 2020 at 19:52
       writer: Apinya Wipatayotin
       Health workers clean Wat Phra Chetuphon Wimon Mangkhalaram in Bangkok and share information with the public on how to avoid viral infections on Friday. (Photo by Arnun Chonmahatrakool)

       The Public Health Ministry is expanding its search for people possibly infected with the coronavirus, resulting in a growing number of patients under investigation (PuI), while the number of local Covid-19 cases remains unchanged at 35.

       Surveillance is being “proactively” expanded to people developing pneumonia with unknown causes in eight provinces that are popular among Chinese tourists, said Dr Tanarak Plipat, deputy director-general of the Disease Control Department.
       …

31. If you see a Realtor in your neighborhood, lock the doors and call the cops immediately.

    “Realtor Arrested For Allegedly Using Open Houses To Rob Celebrity Homes”

    https://kutv.com/news/offbeat/men-arrested-after-using-open-houses-to-rob-celebs-homes

    1. The REALTOR apologists don’t like seeing these links.

       Let’s talk about the election and coronavirus, anything but REALTOR.

32. I’m not sure how one can rule out the weapons lab explanation, but it doesn’t seem very likely for reasons we have gone over several times. Our resident expert keeps forgetting these reasons in his eagerness to glom onto the shiny object of the most popular conspiracy theory on the internet.

    1. Don’t buy China’s story: The coronavirus may have leaked from a lab

       1. “Xi didn’t actually admit that the coronavirus now devastating large swathes of China had escaped from one of the country’s bioresearch labs. But the very next day, evidence emerged suggesting that this is exactly what happened, as the Chinese Ministry of Science and Technology released a new directive entitled: ‘Instructions on strengthening biosecurity management in microbiology labs that handle advanced viruses like the novel coronavirus.’”

          “Add to this China’s history of similar incidents. Even the deadly SARS virus has escaped — twice — from the Beijing lab where it was — and probably is — being used in experiments. Both ‘man-made’ epidemics were quickly contained, but neither would have happened at all if proper safety precautions had been taken.”

          “And then there is this little-known fact: Some Chinese researchers are in the habit of selling their laboratory animals to street vendors after they have finished experimenting on them.”

          1. Socialism is devoid of morality.

             1. Socialism is devoid of morality ??

                So is Trump under the cover of Capitalism…

             2. Capitalism

                Pure silliness.

                Capitalism is not a basic morals system. The CCP looks to me like it did everything it could to strip people of their traditional moral systems of any kind.

          2. Some Chinese researchers are in the habit of selling their laboratory animals to street vendors after they have finished experimenting on them.

             My wife insists that the scientists would never do that, it’s gotta be the cheap help that cleans the place up after hours who are in charge of disposing of the dead animals.

             1. Sure, that’s not too difficult to follow.

33. Is coronavirus the death knell for globalization?

    The Financial Times
    Rana Foroohar
    Coronavirus is speeding up decoupling
    Beijing’s opacity in handling the epidemic highlights the risks of doing business in China
    Rana Foroohar 8 hours ago

    Coronavirus has put a spotlight on the economic decoupling of China and some developed countries. With factories shuttered and consumption stalled, multinational companies have been forced to shift production elsewhere. Apple has warned investors that its revenues will take a hit as a result of the outbreak.

    A gradual decoupling of global economies has been under way for a few years. The South Korean electronics group Samsung, for example, has been closing Chinese plants and opening others in Vietnam. Mexico has benefited from some US corporations moving their supply chains closer to home. But decoupling will undoubtedly speed up as Beijing’s opacity in handling the coronavirus epidemic highlights the risks of doing business in China.

    There are marked similarities between the virus and decoupling itself. There is what you see on the surface (masks and panic or supply chain shifts and profit warnings) and then there is what you can’t know: how many victims the outbreak will claim or what the world will look like economically and politically in five to 10 years, as globalisation dissolves and divides deepen.
    …

    1. The Wall Street Journal
       China
       World Economy Shudders as Coronavirus Threatens Global Supply Chains
       Manufacturers’ increased reliance on more interconnected China sees shortages ripple around the globe
       By Chuin-Wei Yap and
       Jon Emont
       Updated Feb. 23, 2020 12:22 pm ET

       HONG KONG—The last time a coronavirus outbreak hit China in 2003, the global economy emerged relatively unscathed. Now, nearly two decades later, the growth-damping effects of a similar pathogen threaten to ripple around a world transformed by China’s boom.

       Chinese consumption and production power growth from Asia to North America, Europe and beyond. Manufacturers world-wide are tethered to China by the tentacles of a supply chain that relies on the country’s factories for many intermediate and finished goods.
       …

    2. Finance
       Fortune 1000
       94% of the Fortune 1000 are seeing coronavirus supply chain disruptions: Report
       By Erik Sherman
       February 21, 2020 9:39 AM EST

       To understand the potential painful impact of the coronavirus on the Fortune 1000 takes just one word: resin.

       When the 2011 earthquake and tsunami struck the Fukushima Prefecture of Japan, the electronics industry had a huge problem on its hands. Two Mitsubishi Gas Chemical factories in the affected area made almost the entire world’s supply of an epoxy resin called bismaleimide triazine, or BT. Electronics chip manufacturers regularly used BT to seal their components. No BT, no chips, without a major manufacturing overhaul.
       …

    3. Offshoring our production to China, our ENEMY, was criminal, especially when it comes to our pharmaceuticals. You can bet that if there was a war, China would put Ricin or Anthrax in pills to wipe people out.

       1. Globalists gonna globe. Even before globalism was a thing, eighty years ago we dismantled the Sixth Avenue El, sold the scrap to Japan, and they used it to bomb us:

          https://www.laphamsquarterly.org/states-war/ee-cummings-told-him

    4. It’s quite shocking to realize how dependent we have become on China to provide essential supply inputs.

       Healthcare
       February 23, 2020 – 02:55 PM EST
       Coronavirus outbreak could cause shortages of 150 drugs: report
       By Zack Budryk

       A worsening coronavirus outbreak reportedly could threaten shortages of about 150 prescription drugs, several of them with no alternatives.

       China’s role in supplying the ingredients used in medications means that decreased Chinese production capability amid the outbreaks could threaten supplies of the drugs, which include antibiotics, generics, and branded drugs, two sources familiar with a Food and Drug Administration (FDA) list of at-risk drugs told Axios.

       The FDA did not directly comment on the list but said it was “keenly aware that the outbreak could impact the medical product supply chain” and is working to identify potential vulnerabilities connected with it, according to Axios.
       …

       1. Ours is a nation populated by fools.

       2. Notice that it’s hard to find a list of these 150 drugs. Again, not to cause a panic.

          1. Notice that it’s hard to find a list of these 150 drugs

             If you find it, please share. I’ve been thinking about getting an early refill of some medications, just in case.

    5. “We are at a turning point”: The coronavirus outbreak is looking more like a pandemic
       Health experts say it’s time to prepare for worldwide spread on all continents.
       By Julia Belluz
       Feb 23, 2020, 11:20am EST
       Residents of Hong Kong wear masks as a precautionary measure against the spread of the Covid-19 novel coronavirus on February 23, 2020. Vivek Prakash/AFP/Getty Images

       During the last two months, as the Covid-19 coronavirus outbreak has spiraled into a global threat, countries around the world have scrambled to impose travel bans, quarantine millions, and isolate sick people in an attempt to stop the spread of the new virus.

       Yet, as of Sunday, there were 78,000 cases of Covid-19 in at least 29 countries, including surging case tolls in Italy, Iran, and South Korea, as well as an ongoing outbreak on a cruise ship off Japan.

       The likelihood that we’re hurtling into a pandemic — a new disease that spreads around the world — or that we’re already in one, seems higher than just a week ago.

       “Our window of opportunity [for containing the virus] is narrowing so we need to act quickly before it closes completely,” said World Health Organization Director General Tedros Adhanom Ghebreyesus, on Friday.

       Other public health experts think the window has already closed. They say worrisome, new developments suggest containing the virus — particularly in low-resource settings — may no longer be possible.

       “When several countries have widespread transmission, then spillover to other countries is inevitable,” said Anthony Fauci, head of the National Institute of Allergy and Infectious Diseases. “One cannot shut out the rest of the world.”
       …

       1. J.P. Morgan document titled “Risky business: the climate and the macroeconomy” published on January 14, 2020:

          https://www.scribd.com/document/448268595/JPM-Risky-Business-1#from_embed

          If the U.S. military, and Wall Street, are worried about it, maybe it’s time to start paying attention.

          Pigmen don’t stop pigging, without a valid reason…

          1. 6 paragraphs down

             It can’t be stopped without a

             drum roll please

             “global carbon tax”

             1. How do we deal with a “global crisis”? Global government, of course!

             2. “Global government, of course!”

                Yeppers, no more licking stamps for love letters or running around Africa $igning up worker$ … It’$ gonna bee “all.dome$tic” from now.to.eternity!

    6. The Wall Street Journal
       Asia
       ‘The City Has Been Annihilated’: South Korea’s Coronavirus Epicenter Is a Virtual Ghost Town
       The country’s cases rise 20-fold in four days, as Seoul declares a ‘red alert,’ allowing it to block domestic travel among other measures
       By Dasl Yoon and
       Timothy W. Martin
       Updated Feb. 23, 2020 1:00 pm ET

       DAEGU, South Korea—Cafes here demanded orders must be takeout or delivery. A typically bustling market hollowed out. The rare flicker of activity occurred at stores selling face masks, though most had run out.

       These are the scenes of eerie silence unfolding in Daegu, South Korea’s fourth-largest city and an epicenter for a coronavirus outbreak that skyrocketed to 602 cases on Sunday — a roughly twenty-fold rise in just four days.
       …

    7. Health and Science
       Coronavirus live updates: Austria halts train traffic with Italy, Turkey closes Iran border
       Published Sun, Feb 23 2020 9:36 AM EST
       Updated 2 hours ago
       Berkeley Lovelace Jr.
       …

34. What are they spraying? Does this even work? Obviously they think the virus is airborne. Lots of unknowns in China right now, but the situation is definitely, in Xi’s words, grim.

    Coronavirus fight: Hundreds of trucks spray disinfectants in Luoyang

    https://www.youtube.com/watch?v=3-RqckJAulM&feature=youtu.be&t=41

    1. Recently there has been talk about the virus being spread through the sewer system. All sewer systems have to be vented to the atmosphere. Perhaps they are trying to attack that, but it would be an exercise in futility because people are shitting 24/7/365.

       1. Also diarrhea is a coronavirus symptom, which can’t make the problem any easier to contain.

35. germ -a-palooza!

    https://www.pressreader.com/usa/los-angeles-times/20200223/282991106930916

36. Mega.Wanker.Banker$ $uper $trong! 🏦💪, … mini.wanker.NON banker$ awaiting the $laughter 🔪 of their $helter.$hack loan$🚑🏧🏥.

    IN ONE CHART:

    The ugly $ide to the booming U.S. economy, in one telling chart.

    MarketWatch | By Shawn Langlois |Published: Feb 23, 2020

    Delinquencie$ are piling up.

    Low unemployment rates, rising wage growth, a relentless bull market — by many measures, the good times are rolling

    “During the Financial Crisis, delinquencies on credit cards… were soaring because over 10 million people had lost their jobs and they couldn’t make their payments,” he wrote. “But these are the good times… And yet, there are these skyrocketing delinquency rates in the subprime subset of credit cards and auto loans. It means these people are working, and they’re falling behind their debts.”

    So yes, while it’s true that rising stocks, home prices, investment properties, etc. are lining the pockets of the haves, the have-nots, according to Richter’s take on credit-card delinquencies, just keep getting squeezed.

    Richter explained that the big banks use generous offers to go after consumers with high credit scores. “Their special offers rope in the lion’s share of consumers with top credit scores,” he said. The smaller banks, however, don’t have the same resources that the bigger banks have, but can instead offer subprime customers a card with few incentives that charges a hefty 30% interest rate.

    Richter says that this is a clear sign the economy is working for those higher on the income spectrum and leaving the lower earners to suffer.

    As Richter’s numbers on the chart show, the rate of credit card balances that are 30 days or more delinquent at the 4,500 or so commercial banks that are smaller than the top 100 banks spiked to 7.05% in the fourth quarter, the highest delinquency rate in the data going back to the 1980s.

    Meawnhile, the delinquency rate at the biggest 100 banks was at 2.48%.

    1. Again…Nice post Hwy…Very informative…

    2. “Trickle-down” never trickled. It was an elaborate sham – a lie.

       1. “It was an elaborate sham – a lie.”

          Ditto: “Compa$$ionate.CON$ervative!”

37. Denver, CO Housing Prices Crater 17% YOY As One Broker Quietly Admits, “Nobody Knows How To Scam Like Us…. Nobody”

    https://www.zillow.com/denver-co-80202/home-values/

    *Select price from dropdown menu on first chart

    One economist stated, “Banks are choking on mortgage defaults.”

38. I’m not one for toilet humor but this is funny:

    https://twitter.com/globaltimesnews/status/1231587016976060418

    “Farts spread the #COVID19 virus? Pants work just fine to cut off novel coronavirus transmission in farts, a Beijing district disease control center announced on Sunday. http://bit.ly/2HMBbUB“

    1. Another dead link there…

       1. Second link, dead. First link, fine.

          1. Who is killing all the Chinese-related links?

             1. Need you ask?!

             2. In case you haven’t noticed, MSM and social media are extremely manipulated.

             3. Probably not.

39. IMHO it is unfair to blame a regulator for an act of God. That said, command-and-control governance systems create this kind of political risk.

    The Financial Times
    Coronavirus
    The Chinese super-regulator taking on the coronavirus
    Guo Shuqing’s legacy will hinge on whether he can counter outbreak’s economic impact
    Guo Shuqing, chairman of the China Banking Regulatory Commission, speaks during a news conference at the Great Hall of the People during the 19th National Congress of the Communist Party of China in Beijing, China, on Thursday, Oct. 19, 2017. Communist Party leaders are gathering in Beijing this week to map policy for the next five years, with President Xi Jinping telling delegates that China is transitioning from a rapid growth model to one more focused on high-quality development. Photographer: Qilai Shen/Bloomberg
    Banking regulator Guo Shuqing is one of the Communist party’s most trusted technocrats © Qilai Shen/Bloomberg
    Don Weinland in Beijing
    3 hours ago

    In the three years since Guo Shuqing took the helm at China’s top banking regulator, he has won praise for an aggressive drive to tackle problems in the $40tn industry — in particular, his war on bad loans and excessive leverage.

    But the fallout from the coronavirus outbreak that has throttled parts of China’s economy has delivered a savage blow to his reform programme. One consequence of the crisis — which has killed more than 1,500 people and squeezed China’s economy — will be to saddle the country’s banking system with hundreds of billions of dollars worth of new non-performing assets.

    “[The virus epidemic] is disastrous for bad debt and will certainly cause Guo to lose a bit of clout,” said the head of a foreign lender in China, who has worked closely with the banking watchdog.
    …

40. You need not worry one iota about my next post, as the Housing Bubble Blog’s in-house expert offers his personal assurance that all is well.

    1. The Financial Times
       Markets
       Oil and Asia stocks slump as coronavirus spreads outside China
       Gold gains on signs epidemic is gathering pace in Italy and South Korea
       Tourists wear protective face masks at Venice Carnival. Markets fell on fears the coronavirus is spreading outside of China © Reuters
       Daniel Shane in Hong Kong 47 minutes ago

       Asia stocks and oil prices fell while gold gained on signs new coronavirus infections outside of China were accelerating, raising concern over the outbreak’s potential impact on the global economy.

       In early trading in Asia on Monday, the price of brent, the international oil marker, fell 3.1 per cent to $56.68 per barrel, while S&P 500 futures were down 1.3 per cent.

       The sell-off came after Italy at the weekend imposed a strict quarantine across at least 10 towns as authorities battled to contain the biggest outbreak of the deadly coronavirus outside of Asia. Officials said on Sunday that a third person in Italy had died from the virus, known as Covid-19, as the infection count rose to 152, fuelling fears over the disease’s spread through Europe.
       …

       1. Will people blame the Fed if U.S. stocks don’t bounce back soon?

          The Financial Times
          fastFT Markets
          US stocks post weekly drop as investors reach for safety
          Weak data and concerns about coronavirus send US 30-year yield to record low
          Colby Smith and Mamta Badkar in New York February 21 2020

          The yield on the 30-year US Treasury hit a record low and Wall Street posted its first weekly drop in three on Friday as renewed fears about the economic fallout of the coronavirus and disappointing data stirred concerns about the outlook for the US economy.

          Yields had been moving lower on Friday, but were delivered a further knock after weak data showed an unexpected contraction in activity within the US services sector. That added to broader investor concerns about the impact the coronavirus will have on global growth that knocked US and European stocks back from record highs earlier this week.

          The yield on the US 30-year bond fell below 1.9 per cent for the first time, sinking as much as 7 basis points to a record low of 1.89 per cent on Friday morning, New York time. But was back above that level by afternoon trade. The yield on the US 10-year was trading at 1.4713 per cent at pixel time. Yields move inversely to price.
          …

          1. Blame? Bounce back? Jeebus, they’re near record highs after the most insane bubble in history. WTF do people want? This greed is out of control.

          2. US stocks would have to be 70% cheaper to be a wise, long-term investment.

       2. Do you think the writer of this article has a clue about the amount of intervention to prop up markets has been brought into play since the onset of the coronavirus freakout?

          Feb 23, 2020,10:35 pm
          Investors Are Suddenly Flocking To Safe Haven Assets As The Coronavirus Spreads
          Steven Ehrlich Contributor
          Crypto & Blockchain
          I write about blockchain technology with a focus on emerging use cases

          Ever since the new coronavirus reared its ugly head, the upbeat performance of global equities markets has confounded investors.

          Leading equities indices such as the S&P 500 and Stoxx 600 are up on the year, and even the Shanghai SE Composite Index, which fell off a cliff in mid-January is close to even in 2020.

          At the same time, the virus continues to rapidly spread around the world.

          The past two days saw an explosion of infections in northern Italy, where 150+ new cases suddenly appeared. The virus has killed 8 people in Iran, and South Korean President Moon Jae-in, (who is dealing with 600+ cases) just put South Korea on the highest possible alert.

          Suddenly, there is a rush to safety. Gold reached a 7-year high of over $1660.00 per troy ounce, bonds are surging, and yields are falling.
          …

    2. U.S. stock futures sink on growing concern of outbreak’s economic impact
       By Mike Murphy
       Published: Feb 23, 2020 10:05 p.m. ET
       Dow futures drop more than 300 points; crude prices sink 2%
       Bloomberg News
       Workers wearing a protective suit spray disinfectant onto a subway train In Gimpo, South Korea.

       U.S. stock market futures sank late Sunday as the spread of coronavirus raised worries that global economic growth could take a hit.

       Dow Jones Industrial Average futures (YM00, -1.37%) fell more than 300 point soon after electronic trading opened late Sunday. S&P 500 futures (ES00, -1.38%) and Nasdaq Composite futures (NQ00, -1.87%) also fell more than 1% each.

       On Saturday, the International Monetary Fund warned the virus outbreak could reduce global economic growth by 0.1% this year, and drag China’s annual growth 0.4 percentage points lower than January estimates.

       “The world economy is facing a clear slowdown and this slowdown might be reinforced by the so-called coronavirus,” French Finance Minister Bruno Le Maire said at a G-20 finance meeting in Saudi Arabia, according to the Associated Press.

       The global spread of the virus in patients with no links to China suggests “things are about to get extremely problematic, and market conditions could get exponentially worse this week,” Stephen Innes, chief market strategist with AxiTrader, wrote in a note Sunday.
       …

41. Fake News! … China Hoax #5! … Deep.$tate conspiracy! … Hillary’s emails!

    Uh,oh …

    A Person Can Carry And Transmit COVID-19 Without Showing Symptoms, Scientists Confirm

    BY ARIA BENDIX, BUSINESS INSIDER |FEBRUARY 24, 2020

    Chinese researchers have confirmed a case of asymptomatic transmission of the new coronavirus: A 20-year-old woman from Wuhan passed it to five of her family members but never got physically sick herself.

    The case study is the first concrete evidence that a person showing no symptoms can pass the coronavirus to others – a fact that could make curbing the outbreak even more challenging.

    Doctors concluded that the woman’s incubation period – the time during which she was infectious – was 19 days.

    Chinese health officials previously estimated that the incubation period for the virus ranged from one to 14 days, but recent research suggests it could be as long as 24 days.I

    The US and many other countries have established quarantine rules for travellers from Wuhan based on that 14-day window.

    According to a letter published in the New England Journal of Medicine, a woman from Shanghai transmitted the virus to a 33-year-old German businessman in January. Three days later, he felt better and went back to work, then infected at least two of his colleagues. But the researchers had not spoken with the woman, who had in fact experienced mild symptoms at the time of transmission.

    That left scientists unsure as to whether people who never experience any symptoms can transmit the disease – until today.

42. Flower petals falling down: “We need China, … We don’t need China” … $ad.

    (What happen$ Iffin’ the Chinese make the $ame liquidity.mi$takes as the USA, circa, 1929?)

    eCONomic$
    Million of Chinese Firm$ Face Collap$e If Bank$ Don’t Act

    Bloomberg News |February 22, 2020

    Virus outbreak puts millions of small busine$$es at ri$k
    Bank$ have extended help to companie$ in direct path of virus

    Brigita, a director at one of China’s largest car dealers, is running out of options. Her firm’s 100 outlets have been closed for about a month because of the coronavirus, cash reserves are dwindling and banks are reluctant to extend deadlines on billions of yuan in debt coming due over the next few months. There are also other creditors to think about.

    “If we can’t pay back the bonds, it will be very, very bad,” said Brigita, whose company has 10,000 employees and sells mid- to high-end car brands such as BMWs.

    With much of China’s economy still idled as authorities try to contain an epidemic that has infected more than 75,000 people, millions of companies across the country are in a race against the clock to stay afloat

    As a group, Chinese banks had offered about 794 billion yuan in loans related to the containment effort as of Feb. 20, according to the banking industry association, with foreign lenders such as Citigroup Inc. also lowering rates. To put that into perspective, China’s small businesses typically face interest payments on about 36.9 trillion yuan of loans every quarter

    Support from China’s banking giants in response to the outbreak has so far been piecemeal, mostly earmarked for directly combating the virus. Industrial & Commercial Bank of China Ltd., the nation’s largest lender, has offered relief to about 5% of its small business clients.

    Stringent requirements and shortlists restrict who can access special loans earmarked by the central bank for virus-related businesses, while local governments and banks have imposed caps on the amounts, according to people familiar with the matter. A debt banker at one of China’s largest brokerages said his firm opened a fast lane to ease debt sales by businesses involved in the containment effort, with borrowers required to prove they will use at least 10% of the proceeds to fight the disease.

    Liquidity $queeze:

    China’s private sector bond issuance falls below maturities in February

    Many of China’s businesses were already grasping for lifelines before the virus hit, pummeled by a trade war and lending crackdown that sent economic growth to a three-decade low last year.

    At most risk are the labor-intensive catering and restaurant industries, travel agencies, airlines, hotels and shopping malls

    Banks are hardly any better off themselves. Many are under-capitalized and on the ropes after two years of record debt defaults. Rating firm S&P Global has estimated that a prolonged emergency could cause the banking system’s bad loan ratio to more than triple to about 6.3%, amounting to an increase of 5.6 trillion yuan.

    Wu Hai, owner of Mei KTV, a chain of 100 Karaoke bars across China, took to the nation’s premier outlet of discontent, social media platform WeChat, to voice his despair.

    KTV’s bars have been closed by the government because of the virus, choking off its cash flow. The special loans from the authorities will be of little help and no bank will provide a loan without enough collateral and cash flow

    With assistance by Evelyn Yu, Ken Wang, Zheng Li, Xize Kang, Jun Luo, Emma Dong, and Yinan Zhao

43. Monie$ might feel $suddenly $ick come Monday a.m. …

    Coronavirus update:

    Italy cases surge from three on Friday morning to more than 130 by Sunday

    February 23, 2020 06:03 GMT | By Ross J Burland

    FX implication$:

    The euro is already on its knee$, $uffering due to economic weakne$$ in the bloc and the market’s demand for US stocks and U$D denominated investments. On news such as this which will rear-up panic among consumers and uncertainty for businesses, the immediate concern will be the negative consequence$ for the European economy, further weighing on the $ingle currency

    1. Is it too late for stock HODLers to cut bait and head for the shore?

44. Does South Korea have many Global.Trading.Partner$?

    Busine$$:

    These Countries Just Re$tricted Travel From South Korea

    Bloomberg |By Kyunghee Park | February 23, 2020

    Fourteen countries and a U.S. territory placed tighter entry restrictions on people traveling from South Korea after a sharp jump in coronavirus cases prompted the government in Seoul to raise its infectious-disease alert to the highest level.

    Measures include banning entry for people who have been in South Korea in the past 14 days and mandatory health checks, according to the Ministry of Foreign Affairs. The number of infections in South Korea rose to 763 as of 9 a.m. local time, up from 602 Sunday, the most for anywhere outside mainland China. Seven people have died in the country from the virus.

    U.S.:
    The U.S. Department of State issued a level 2 travel advisory. While it tells people to take extra care when traveling to South Korea, it hasn’t put restrictions on people coming from the country to the U.S. Travelers to American Samoa will be required to self-quarantine for 14 days in Hawaii if they visited South Korea within 14 days and need to submit medical documents three days before entering the territory.

    U.K.:
    Travelers who visited South Korea need to self quarantine for 14 days if they show symptoms of the disease and will be required to report to authorities.

45. Only 2,500 dead my rear:

    50-60 K people in hospitals in #Wuhan, out of 18 cremators at a crematorium, 3 were burned out due to overuse. Other 15 in operation 24/7. Many families died out.

    https://twitter.com/jenniferatntd/status/1231648876605661192?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1231648876605661192&ref_url=https%3A%2F%2Fwww.zerohedge.com%2Fgeopolitical%2Fcoronavirus-panic-goes-global-skorea-warns-watershed-moment-italy-quarantines-12-towns

    1. Today in China, the message is enough talk about the sick and dead, get back to work!

       1. ” …get back to work! ”

          Yeah, that’$ 808 million time.card$ that need to bee punched, hurry up!

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