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A Massive Oversupply When Demand Is Simply Not There

A report from the Columbia Missourian. “Local short-term rentals such as those offered on Airbnb have seen few or even no renters throughout Missouri and Boone County’s stay-at-home order. The loss of income affects owners’ ability to pay bills. Alyce Turner offers a two-bedroom, one-bathroom private apartment near MU through Airbnb. At the end of March, Turner had $1,300 worth of bookings through April and May. Since then, she all her bookings have canceled. About one-third of Turner’s income comes from her Airbnb rentals. She said she could run into issues making mortgage and utility payments if trends continue.”

“Turner now has only one booking, in June. She said ‘everything revolves around the university,’ so the cancellations of end-of-semester events — along with stay-at-home orders — caused a downturn in April and May bookings. Only time will tell if the opening of economies and the lifting of stay-at-home orders will boost the number of short-term renters. ‘I think we’ll start seeing more, but it will be a whole lot less,’ Turner said.”

The Oregonian. “Long before the coronavirus pandemic crushed the economy and slowed real estate sales, some high-priced residential properties were lingering on the market. Asking prices were dropped and negotiations took place to close the deal. $350,000 price drop in Forest Park: 621 N.W. Skyline Blvd. in Portland sold for $850,000 on Feb. 28, 2020, a reduction of $350,000 since being listed for $1.2 million on April 24, 2018, according to public records.”

“$234,000 price drop in Forest Park: 2524 N.W. Skyline Blvd. in Portland sold for $1,465,000 on March 25, 2020, a reduction of $234,000 since being listed for $1,699,000 on June 24, 2019 (It was listed at $1.9 million on July 30, 2018). $195,000 price drop in Forest Park: 13731 N.W. Glendoveer Dr. in Portland sold for $1 million on April 15, 2020, a reduction of $195,000 since being listed for $1,195,000 on April 6, 2019.”

The Vancouver Sun in Canada. “One of the most important insights into debt and the future of urban Canadian housing comes from Anthony Scilipoti, president of Toronto-based Veritas Investment Research Corp. Scilipoti’s researchers have discovered that half the country’s property investors (such as the tens of thousands who have bought condo units in towers to rent out) aren’t getting enough cash from tenants to cover their mortgage costs. ‘There’s only so long they can hold on,’ he says, before being forced to sell.”

The Georgia Straight in Canada. “Over social media, there’s are hints of how brutal things have become for vendors not in the mood to wait. For example, a vacant parcel of land at 5644A Westport Road in West Vancouver sold on April 22 for $1,075,000.The asking price was $1,495,000. That’s not all. The assessed value was $2,124,000 in 2019, meaning the recent sales price was 49 percent lower than that. That’s not the only apparent fire sale. Below, you can see examples of some other signs of a distressed Metro Vancouver housing market.”

The Canadian Press. “Stephen Glaysher, a realtor who runs a site called MLS Sold Data, said he expects price declines to be moderated as homeowners defer or restructure payments and foreclosure and power-of-sale orders are at least a year away since courts are currently closed. The lack of new listings is also helping to prop up prices, though current listings could see some downward pressure on prices, he said. ‘It’s not the right time to sell right now. So if you do see a listing coming out, you assume it’s someone who’s motivated to sell.'”

From Burnaby Now in Canada. “People laughed and choked on their morning coffee recently when it was reported that Airbnb actually had the gall to lobby the Canadian government for financial relief and tax breaks for its hosts. In Burnaby, we’ve seen how much of a panic these hosts are in because they have flooded the local rental market with ‘furnished’ units that are offered on a month-by-month basis. Sorry, but I have zero sympathy. Airbnb was originally pitched as a way for people to rent out a spare bedroom once in a while to make extra money.”

“Today, it’s people running their own mini-hotel chains. I’m sorry you are mortgaged to the hilt, but you’ve exploited our housing market for years so bye, Felicia. Don’t expect taxpayers to care.”

From Nine News in Australia. “An oversupply of vacant apartments and homes and a lack of demand has seen rents slashed across Sydney. A two-bedroom apartment literally across the road from Bondi Beach has been cut from $920 a week to $650. On the other side of the harbour in Manly, a two-bedroom, two-bathroom unit with parking is reduced by $300 a week to $500 for the first six months. Zero tourists, no immigrants, a flood of properties that were once used for Airbnb and new apartment blocks being completed have created a massive oversupply of units when demand is simply not there.”

“Real estate agents say it’s dire. And they’re having to slash asking rents to attract tenants. ‘We’ve seen in some situations up to 25 to 30 per cent drops on some properties,’ said agent Ric Serrao of Raine & Horne Double Bay. Our suburbs now littered with For Lease signboards.”

From Domain News in Australia. “Home buyers and sellers fought a tug-o-war at painstaking online auctions on Saturday as price expectations from both sides diverged. There were just 211 properties scheduled for auction in Sydney on Saturday and while there were many vendors with unrealistic expectations in the current market, there were also reluctant or bargain-hunting buyers. In Melbourne, buyers’ and sellers expectations’ were also mismatched with vendor bids placed to get sell-offs started and interested parties reluctant to raise the price.”

“Listing agent John Arroyo said sentiment had changed from the end of March to the end of April, with more inspections happening, although prices had dropped about 5 per cent in the local area and some vendors still holding on for ‘pre-corona prices.’ ‘Most [sellers] come down,’ he said. ‘Some buyers come up.'”

The Otago Daily News in New Zealand. “Despite rental prices in Queenstown dropping by about 30%, it is too early to tell what the impact of Covid-19 will be on the longer-term residential property market. Queenstown Lakes Community Housing Trust executive officer Julie Scott said some of those on a 600-strong waiting list would drop off — either because they had left the district, or because they could now afford market rents. ‘I, personally, think the rental market was overpriced and needed a reset, so I think that’s really positive.'”

The Times of London in the UK. “Tucked away at the back of Lloyds Banking Group’s first-quarter results this week were some startling figures. If the economic crisis were to seriously worsen, it said, house prices could fall by 10 per cent this year, then by another 10.9 per cent in 2021, then by a further 12.9 per cent in 2022. Overall, property values could fall by 30.2 per cent over three years, which would be unprecedented in modern times. The peak-to-trough fall in house prices after the banking crisis in 2007-09 was 19.4 per cent, according to Nationwide.”

“The projected fall would send the value of the average home sliding from £223,000 to £156,000, reducing the wealth of the average owner-occupier by £67,000. Scaled up across the country, about £2.2 trillion of household wealth would be wiped out. Forced sellers would be hit, too. Evidence of financial stress is mounting already. Between March 25 and April 8, more than 1.2 million borrowers had requested mortgage holidays, according to UK Finance, the trade association. Owner-occupiers furloughed on 80 per cent pay or the self-employed with no money coming in have quickly become vulnerable.”

“For house prices to have taken a big dive would have meant that the economy had already cratered, but a weakened housing market would add to the downturn. The “wealth effect” has been a potent driver of the economy for decades. Consumers feel confident to spend when their homes are rising in value. A crash would reverse that effect.”

This Post Has 303 Comments
  1. ‘Long before the coronavirus pandemic crushed the economy and slowed real estate sales, some high-priced residential properties were lingering on the market. Asking prices were dropped and negotiations took place to close the deal’

    Yep, this bubble popped long ago.

  2. ‘Don Ray, who has been working at a grocery store for the past several months, said he wasn’t worried about catching COVID-19, the disease caused by the new coronavirus, at the mall.’

    “I’m highly educated and have a background in medical stuff,” he said. “But I work at Randalls. It’s funny how apparently COVID-19 doesn’t exist in grocery stores but can exist everywhere else, but whatever,” he added sarcastically. “That’s just me.”

    “I’m just here to see the turnout,” said Jesse Perez, who wore a Dallas Cowboys face mask and said he normally comes to the mall several times per week. “I believe they’re exaggerating the extent of how bad this truly is, so I really don’t know the whole reasoning for the whole pandemic terminology used. But that’s just me.”

    ‘Perez said he still doesn’t personally know of anybody who’s been infected by the virus, so going to Barton Creek on Friday didn’t concern him.’

    ‘When the doors finally opened, no one’s temperature was checked; many customers came in bare-handed. “I think it’s all a big farce. I believe there’s a virus, but we have bird flu and pneumonia and I’ve had several shots,” said Charlene Franz, 65, who came to the mall to fix the cracked screen on her Cricket cellphone and return a broken pair of sunglasses purchased from Loft.’

    https://www.texastribune.org/2020/05/01/texas-reopening-austin-mall/

    1. ‘I work at Randalls. It’s funny how apparently COVID-19 doesn’t exist in grocery stores but can exist everywhere else, but whatever,” he added sarcastically. “That’s just me.’

      Even at this point, where’s the massive death tolls for grocery workers? There isn’t one.

      ‘I think it’s all a big farce’

      Years ago prior to the second Iraq invasion, I noticed a change in how the media was reporting. So I started recording many hours of the shorter news cycle channels like BBC had. Then I watched them months later. It was plain that even though there was much talk about discussions to prevent the war, the closer it got it was a foregone conclusion. And the media was completely onboard, using less and less critical thinking every hour. When the globalists decide to do something they bring the weight of their media empires to pound it into the minds of everybody. They are relentless, without morals, using fear. Fear is the easiest thing to generate – remember when Saddam was gonna kill us all? This thing was a farce, at least in the difference between what it was and how it was presented. Now with each passing hour, the hysteria is lifting.

      1. What I’m starting to get a sense of now is that the media is realizing that they are losing the grip of fear over people and the ability to hold this lockdown in place for much longer, and are now resorting to the “you’re stupid for not listening to us” approach — you know, like getting called a “denier” if you don’t unwaveringly buy their bullshit about climate change.

        https://www.freep.com/story/sports/columnists/mitch-albom/2020/05/03/mitch-albom-coronavirus-isnt-over-dont-break-free-yet/3072346001/

        https://www.theguardian.com/technology/2020/may/01/coronavirus-has-elon-musk-acting-like-just-another-used-car-salesman

        https://www.ft.com/content/1efbd3ac-8af3-11ea-a01c-a28a3e3fbd33?segmentId=b385c2ad-87ed-d8ff-aaec-0f8435cd42d9

        https://www.miamiherald.com/opinion/opn-columns-blogs/leonard-pitts-jr/article242239621.html

        1. Call it covid-1984 and a pandemic to their faces. Mayors and politicians hate to be called NAZIs as well so keep that in mind…

      2. “At least 30 grocery store workers have died from the coronavirus”
        https://www.businessinsider.com/grocery-store-worker-deaths-from-coronavirus-at-least-30-nationwide-2020-4

        “Grocery Workers Keep Dying From Coronavirus: ‘We Don’t Have a Choice’”‘
        https://www.vice.com/en_us/article/qjdqa5/grocery-workers-keep-dying-from-coronavirus-we-dont-have-a-choice

        “At least 41 grocery workers have died of the coronavirus and thousands more have tested positive in recent weeks”
        https://www.washingtonpost.com/business/2020/04/12/grocery-worker-fear-death-coronavirus/

        The death toll may be underreported or lower than general population since grocery workers tend to skew younger, but it’s real, not a farce.

        1. “At least 30 grocery store workers have died…”

          How many would have normally died due to other causes over a comparable number of demographically similar individuals and time period?

          1. Twenty and thirty something folks have really low death rates. Doesn’t take much to double or triple their rate.

        2. My brother tested positive after someone coughed on him @ the grocery store on April 1. He only had the loss of smell for one day and has felt bad for 30 days. Stuck in the spare bedroom, scared he will infect his vulnerable wife. His BP went up to dangerous levels a couple of days ago. This is the strangest virus. Now kids getting rashes on their faces and toes turning red. WTH is this thing?

          1. Was your brother wearing a mask?

            COVID is not exactly a respiratory virus — it’s a blood virus that happens to hit your lungs because that’s where the virus enters. If your brother is still feeling bad after 30 days, he should consider going into the hospital for more sophisticated treatment.

          2. I had the coronavirus back in March because I work at the airport. I also had a very unusual spike in my blood pressure especially the bottom diastolic value which the doctor said that rarely every goes up, it is generally only the systolic number that rises when people have high blood pressure like my dad.

            I had a very bad dry cough, fatigue and a slight fever but it was not as bad as some flus I have had in the past. However, the symptoms lingered and for about three weeks I would get a fever exactly at 5:00 pm every day and feel really out of it.

            It was more strange than bad but the blood pressure stuff freaked me out.

          3. “…diastolic value…”

            I knew a guy in the military HQ, S4 logistics, who just couldn’t handle the unit’s deployment. He developed a high diastolic reading, and he couldn’t get any sleep; his puffy eyes looked exhausted. I heard that he drank himself to death.

        3. The shutdown is the farce. Hospitals never overwhelmed, that should have been the end of it. If we care so much about grocery workers, why not shut them down? A little thing called trade-offs. I talked with an elderly lady at the chain grocer. She said she was just glad to have a job. BTW, those grocery deaths are thin soup. If this thing was anywhere near as bad as we were bombarded with, it would be through the roof.

          Listening to the radio this morning, we got less than 300 deaths. Arizona has over 7 million people. It’s estimated that a quarter of the businesses that were shut down won’t open ever again. That’s a damn poor trade-off.

          Now we open back up. Why? Because the guberments are afraid their tax revenues won’t recover. What do you know? A trade-off!

          There are two things that make this country a great place to live: freedom and standard of living. The guberments may have screwed up both. Not you nor governors nor anybody has the right to deny US citizens of their rights. We’ll see you guys in court, with damages in hand, after you crawl out from under your beds.

          1. It’s estimated that a quarter of the businesses that were shut down won’t open ever again ??

            I have seen similar numbers….With that said, like I have said to my son’s, the pressure on the owners/landlords to reduce lease rates are going to be significant…Business may not be able to make it @ $2.00 per foot but can they make it @ $1.00 per foot ??…Owners will capitulate because if they don’t there is no one in line to take the space at a higher rent…Valuations are going to fall…County taxes will need to come down reflecting the new values…

          2. those grocery deaths are thin soup

            The vast majority cannot grasp simple math and cannot assess personal risk. Why else would anyone go into debt for 30 years to buy a house that will cost 10x their income. Why else would people jail themselves to avoid something that has only a 1 in 10,000 chance of bringing them down.

          3. “You’d be AMAZED at how much power the law grants the feds and the states during declared emergencies.”

            I wouldn’t.

            Go back and check out when federal and state authorities declared a pandemic emergency. There’s a good reason for this.

          4. There are two things that make this country a great place to live: freedom and standard of living.

            You must be some kinda far-right conspiracy theorist with all that “freedom” talk.

          5. A lot of screaming Karens are still getting a paycheck , like teachers, sitting at home “working online.”Such sacrifices…

          6. Not only does the law permit exactly what the government is doing

            It does not. In American constitutional law, strict scrutiny is the highest and most stringent standard of judicial review, and results in a judge striking down a law unless the government can demonstrate in court that a law or regulation:
            1. is necessary to a “compelling state interest”;
            2. that the law is “narrowly tailored” to achieving this compelling purpose; and
            3. that the law uses the “least restrictive means” to achieve the purpose.

            It is part of the hierarchy of standards that courts use to determine which is weightier: a constitutional right or principle, or the government’s interest against observance of the principle. The lesser standards are rational basis review and exacting or intermediate scrutiny. These standards are used to test statutes and government action at all levels of government within the United States.

            U.S. courts apply the strict scrutiny standard in two contexts: when a fundamental constitutional right is infringed,[1] particularly those found in the Bill of Rights and those the court has deemed a fundamental right protected by the Due Process Clause or “liberty clause” of the 14th Amendment, or when a government action applies to a “suspect classification”, such as race or national origin.

            To pass strict scrutiny, the law or policy must satisfy three tests:
            1. It must be justified by a compelling governmental interest. While the Courts have never brightly defined how to determine if an interest is compelling, the concept generally refers to something necessary or crucial, as opposed to something merely preferred. Examples include national security, preserving the lives of a large number of individuals, and not violating explicit constitutional protections.
            2. The law or policy must be narrowly tailored to achieve that goal or interest. If the government action encompasses too much (overbroad) or fails to address essential aspects of the compelling interest, then the rule is not considered narrowly tailored.
            3. The law or policy must be the least restrictive means for achieving that interest: there must not be a less restrictive way to effectively achieve the compelling government interest. The test will be met even if there is another method that is equally the least restrictive. Some legal scholars consider this “least restrictive means” requirement part of being narrowly tailored, but the Court generally evaluates it separately.

            Trey Gowdy does a good job of discussing strict scrutiny in the context of COVID-19 here: https://youtu.be/KOexVu9Ou50

          7. “least restrictive”

            That could be fertile grounds for suing overly risk averse governments.

          8. unless the government can demonstrate in court

            Notice also that the burden of proof falls on the government.

          9. Redpill, TL;DR, but “compelling state interest” is pretty darn broad. Preventing a hospital crisis similar to what we saw in Italy and France is probably pretty easy to prove.

          10. “‘Italy and France’

            I don’t live there.”

            I’ve never visited Italy (too dirty, by my wife’s standards) and have only set my foot in France overnight (Strasbourg).

            But having visited Arizona a few times, I can say for certain that Arizona is nothing like Italy or France.

            And also that one-size-fits-all approaches are very costly in the presence of vastly different circumstances.

          11. I’m also admitted to New York State and the United States Patent and Trademark Office. How many bars have you passed?

        4. The quoted grocery store death stats don’t even add up to one per state. Many states have zero. While it may be ‘real’ it is not a great stretch to imagine a more sensible approach.

          1. In American constitutional law, strict scrutiny is the highest and most stringent standard of judicial review, and results in a judge striking down a law unless the government can demonstrate in court that a law or regulation: I truly doubt that the USSC’s review & approval of FDR’s abrogation of gold clauses in 1933 and the imprisonment without trial of American citizens of Japanese descent during WWII came anywhere close to meeting this elevated standard. “Emergency” was mentioned in the court filings, I think.

      3. I remember that change. And I read that after we’d been mobilizing a long time an aide told GWB, well we can’t stop now after all this buildup.

        Bush was angry af but not enough to put on the brakes.

        1. I asked a guy I hiked with his opinion of the virus.
          PHD IN Microbiology and works in R&D for a major medical company.
          His direct quote on the virus
          “I am not impressed “
          Later said that people are terrible at risk assessment.
          His recommendation on staying healthy
          Get your flu shot if you haven’t gotten 1 and wash your hands.
          I haven’t spoken to him in a few months so it would be interesting to see if he has changed his mind.

          1. “I haven’t spoken to him in a few months so it would be interesting to see if he has changed his mind.”

            Do you think 64,000 or so U.S. deaths in April could have made a difference to his thinking?

          2. A LOT has happened in a few months. The case count — for almost all countries — shot straight up because the R-naught is so high. Secondly, while everyone focuses on the death rate, there are millions who are suffering with an unconfirmed case at home for weeks on end. Thirdly, this virus strikes the blood and can travel to any organ: lung damage, liver damage, skin damage. This is all very impressive.

            However, the virus has a lot of weaknesses too. If we can get a handle on some zinc ionophore treatment (HCQ+zinc or something milder+zinc), the virus appears to be quite vulnerable to that. And treating patients with survivor’s antibodies appears to be successful, which bodes well for a vaccine. So I think we’ll get there eventually.

          3. “The case count — for almost all countries — shot straight up because the R-naught is so high.”

            Nothing like reedumuccation in the wonders of exponential growth!

          4. treating patients with survivor’s antibodies appears to be successful, which bodes well for a vaccine

            Logic please?

          5. You’re assuming that vaccines are targeting the same thing that uncharacterized antibodies from recovered patients are targeting. There’s also a possibility the antibodies from recovered patients are targeting more than one thing.

          6. bodes well for a vaccine. Consider the possibility that there will be no vaccine for the next 5 years.

          7. The immune system chews up and displays multiple fragments of an antigen. With antibodies from recovered patients you don’t know which fragment a given antibody is attacking. A vaccine IIUC is typically a small portion of the antigen.

          8. no vaccine for the next 5 years

            Exactly. No coronavirus vaccines to date and Fauci didn’t follow through with an HIV vaccine either.

        2. “Bush was angry af but not enough to put on the brakes.”

          And some payback for those Scuds targeting Tel Aviv.

    2. The fact that they let people go to grocery stores for the longest times without masks tells you they just wanting to shore up the medical system to handle the number of cases they thought they were going to get.

      It turns out the models were wrong, but some people talk about the second surge that might happen to justify keeping the lock down in place for months.

      Some poll said that 75 percent still want the lock down. I don’t believe this poll.

      1. “It turns out the models were wrong,…”

        All models are wrong, but some models are useful.

        1. The original model that estimated 100,000 to 260,000 US deaths looks like it will be on the money

          1. Yes, at least so far as reaching 100,000 fatalities is concerned. Whether the upper bound will hold remains to be seen, given that we are only one month into the high death toll period of the pandemic in the U.S.

          2. The final tally will come after we have a vaccine and we seem to be way far away from that…

        2. PB,
          I don’t blame them for acting on the high number models given the limited information they had at the the time.

          At one point I thought the death rate might be 2 to 4 percent.

          1. Death rate is a dodgy statistic when you don’t have enough testing to have any idea of the actual number of infections, especially in the case of a disease with a high number of asymptomatic cases like COVID-19.

            What we do know at this point is that among the symptomatic (confirmed) cases that were severe enough to warrant testing, 242,852 of the 1+ million cases have a resolved outcome. The fatality rate so far among resolved cases is 28%, which helps explain why everyone is happy to wear masks while shopping these days.

          2. And if by “death rate”, you mean the overall population death toll, it’s still too early in the outbreak to guess where that will land. U.S. deaths so far have mainly occurred over the past month (i.e. over 50,000 in April), and past pandemics have played out over years.

            Not trying to scare the kiddies here, but I do prefer to keep a clear perspective on unfolding events.

          3. The fatality rate so far among resolved cases is 28%
            Cheer up. The fatality rate among unresolved cases is 0%.

          4. “The fatality rate among unresolved cases is 0%.”

            Unresolved for now, but it will definitely be > 0% when resolved.

          5. The death rate among those who are alive at the moment & who will die from COVID-19 by the end of 2020 is 0% – at the moment.

      2. “just wanting to shore up the medical system to handle the number of cases they thought they were going to get.”

        That’s what I think too. But I’m not going to give up my mask for a couple months at least. The Czech republic mandated face coverings on March 18. It took about three weeks for them to see their R-naught fall below 1, and for their new case count to start decreasing. Maryland started requiring masks about a month after the Czechs, so I guess we still have a couple weeks to see improvement. But I’m feeling good enough to venture out more often. Next stops will be Home Despot to east least poke around the gardening section. HD has some pretty nice wide aisles.

          1. How ya doin. Today’s thought: For eight years I have lived in a 3/2 blue-collar SFH with a nice lot, built 50+ years ago during America’s heyday. My house is worth 1.5x what I owe on it.

            You run electric for crappy new luxury apts of the type that contributed to this housing bubble. A 1-bed airbox that you helped build sports a monthly payment about the same as my (including taxes and insurance.) Doesn’t that make YOU more connected to these oft-maligned realtors than I ever was?

          2. “My house is worth 1.5x what I owe on it.”

            Is that what it is worth to you personally, or what you think you could get if you sold it?

            How do people estimate market value when nothing is selling?

          3. PS You’ll be happy to know I joined the masked shoppers club as of yesterday, which became mandatory in San Diego last Friday. I personally don’t believe wearing a makeshift mask confers any meaningful protection. But if it’s the law, I will grudgingly comply.

          4. “How do people estimate market value”

            Assuming she is 8 years into a 30 year mortgage, it will be another decade or more until she’s not underwater.

          5. OK, so now I have the choice of thinking either that you two are either monumentally stupid, or just trolling me. I vote for trolling.

          6. I was just doing a little bit of mask research and was stunned to see how monumentally stupid/lazy our supposedly “smart” scientists at NIH/CDC are. I found a “scientific” paper which concluded that there wasn’t much data. For frick’s sake go out and get some data. How hard is it to simulate a cough or a sneeze with some perfume aerosolizers with red dye and just test everything from N-95, surgical masks, plastic face shield made from a clear gallon jug, bandanna, etc? I could probably rig up something like that in a week.

          7. “I vote for trolling.” 💗

            Don’t put a will to stupidity beyond the aspirations of a typical American male trapped in quarantine.

          8. I can’t read the news anymore because I’m tired of being treated like a third-grader. However, IIUC, if you’re wearing a bandanna mask, it will stop you from breathing in SOME of somebody else’s exhale, but not all of it. However, if the infected person is wearing a mask, that will stop the virus from coming out on his side of the equation. So if everybody wears a bandanna mask, it won’t guarantee that everybody is safe. But it will cut down the severity (and probably cut down the number of confirmed cases, since a case needs to be moderate in order to be tested).

          9. Is that what it is worth to you personally, or what you think you could get if you sold it?

            This is an interesting question which will be answered for many sellers of houses, cars and other big ticket items over the course of the coming months and years. I don’t think sellers are going to be particularly happy with the answer, either.

          10. “You’ll be happy to know I joined the masked shoppers club as of yesterday, which became mandatory in San Diego last Friday.”

            You have been assimilated, comrade.

        1. oxide,

          I’m not giving up my mask yet either. But, what I am working on is trying to shore up my immune system so if I get this bug it won’t get me as bad.

          1. The best way to lessen the severity of the case that you might get is to decrease your initial viral load. (inoculation) That is, don’t breathe in other people’s exhale. Wear a mask and stay 6 feet away. If you do walk close to someone, hold your breath (that’s what I’m doing). Immune system: Vitamin C, Vitamin D, Zinc, good food, exercise, no snacking. Have quercetin on hand. Intermittent fast and low carb if you can. If nothing else, you’ll lose a couple pounds.

          2. Some good advice…especially the viral load, which is not something most people have heard of or understand. Would be nice if the .gov would explain that, as it would probably encourage more to wear a mask.

          3. decrease your initial viral load. (inoculation)

            I tried finding information but inoculation theory turns up stuff about communication and social psychology. How do you dose something that is initially unquantified?

          4. I tried finding information

            I tried looking it up as well, back when Oxy first talked about it. Couldn’t find anything.

          5. I got the concept of inoculation from the Peak Prosperity youtube videos. I don’t think there’s any inoculant data for COVID, but a lot of research has been done for flu viruses. Most of it is vaccine research to determine the correct inoculant dose to produce the desired immunity. But there is some research on initial viral dose and the body’s response. Here’s one”
            https://jlb.onlinelibrary.wiley.com/doi/pdf/10.1189/jlb.1011490

          6. NOBODY sneezes or coughs while shopping, so that data is irrelevant. My last report from a cousin in SC 2 days ago said sneezing / coughing in public places is QUITE common there, still. Another cousin in NW lower Michigan reported a few days ago she was trying to fill her gas tank when someone pulled up on the other, coughing, sneezing & spluttering. She drove off immediately, having added almost nothing to her gas tank. Of course this is “irrelevant”, or as medical researchers like to say, “merely anecdotal.”

          7. the correct inoculant dose to produce the desired immunity

            Again, I ask how do you dose something that is initially unquantified? Exposing yourself “in the wild” is different than a vaccine.

          8. Tresho…point taken. All it takes is one idiot with COVID-19 sneezing or coughing in an open place for everyone else present to wish they had on a mask. The fact that I have heard nobody sneeze or cough while shopping doesn’t mean it doesn’t ever happen.

          9. Again, I ask how do you dose something that is initially unquantified?

            You get enough patients and data to quantify it, I suppose. I didn’t study this branch of science. My talent was more on the engineering side. As for antibodies boding well for a vaccine, I think it’s promising that 1. we make antibodies at all and 2. the virus is vulnerable to those antibodies 3. those cases of “reinfection” were a testing error.

          10. I think it’s promising that

            We have immune systems that have handled and will continue to handle these sorts of things.

      3. I don’t, either. We ventured out yesterday afternoon and drove by the local Home Depot — you couldn’t see an empty parking spot in the lot.

        If they try pushing this past Memorial Day, there is going to be trouble.

        1. I went to the Home Despot the other day to buy an unusual light bulb type you wouldn’t find at WallyMart. They were metering entries and I had to wait a few minutes before entering the store. Once inside the store felt deserted, there was only one other shopper in the vast light bulb aisle.

          The parking lot wasn’t packed, but it wasn’t empty either. There was no wait in the self checkout lanes.

          1. What happened here was that specific areas in home improvement stores had been roped off and shut down (paint, lawn and garden) due to the volume of customers they were attracting — mostly because people were bored and trying to find things to do at home during General Half-Wit’s already draconian lockdown.

            Those restrictions have since been pulled, and what we’re seeing here now is all of that pent-up demand overflowing. If they had at least allowed the stores to offer something like curbside pickup of orders called in, it wouldn’t have been as bad. But our governor is on a power trip and is clearly getting off how how much suffering and inconvenience she can inflict on the state’s residents, while of course none of said restrictions apply to herself.

          2. Same experience in a Colorado Home Depot yesterday. People lined up from the entrance to the exit waiting to get in. I decided not to go in, what I needed wasn’t that important. Same thing at Sam’s Club, waited about 3 mins, went it and it was basically deserted. What I notice in Sam’s/Walmart is the stores have huge amounts of SF but the isles are jammed together, some in Walmart you can barely fit two carts side by side.

            Like TSA and it’s security theater, this is just safety theater. 500 or so deaths in Colorado with a population of 6 million. Destroyed the economy for what again? Just wait until the post China Virus death stats roll in, all the surgeries put off, people not going to the doctor, despair, etc.

          3. I wonder what drove Polis to start reopening vs. going General Half Wit’s route? Fear of the masses?

          4. I wonder what drove Polis to start reopening See what happened next door:

            An emergency declaration that took effect at midnight Friday has been amended after businesses reported their employees were being threatened with physical harm by members of the public who didn’t want to wear face coverings.

            From Stillwater OK.
            Apparently the Stillwater Police Dept. is OK with threats of “physical harm”.

      4. 75 percent still want the lock down. I don’t believe this poll.

        Here’s a poll question for you:

        Should we continue to practice wise and helpful social distancing, like any intelligent person would and SCIENTISTS recommend, or would you like your mother to die a horrible and unnecessary death?

        1. Anytime I read “scientists say” or “experts predict” or “the elites” I automatically relegate it to the BS bin in my mind.

          1. Which is really too bad. The real journal articles written by real scientists with real peer review are very solid and thoughtful. But if you have a time crunch, political pressure, money pressure, or job insecurity, you get crap science. And can really blame the scientists. You go to school for years in a difficult subject only to run into bosses that want you turn lead into gold, before the next quarter’s earnings are due. There’s a reason I’m a fedgov.

            And old scientist friend of mine used to say that the best science came out of the old Soviet Union. Those guys had job security and no pressure to publish. So when they did publish, it was high quality because it was science they wanted to do and they had lots of time.

        2. I’d like to see the follow-up study on how many unmasked protestors get COVID-19.

          Associated Press
          Birx: ‘Devastatingly worrisome’ to see protesters gathering without masks
          Published: May 3, 2020 at 4:50 p.m. ET
          By Associated Press
          Protests against stay-at-home orders in a number of states
          Protestors gather Friday in Huntington Beach, Calif. in opposition to California Gov. Gavin Newsom’s order to close Orange County beaches.
          Getty Images

          WASHINGTON — White House coronavirus coordinator Dr. Deborah Birx is calling it “devastatingly worrisome” to see protesters in Michigan and elsewhere not wear masks or practice social distancing as they demonstrate against stay-at-home orders.

          Birx was responding to the hundreds of protesters who crowded the Michigan statehouse last week to push for a reopening of businesses.

          She told “Fox News Sunday” that people “will feel guilty for the rest of our lives” if they pick up the virus because they didn’t take precautions and then unwittingly spread it to family members who are especially vulnerable to severe illness due to preexisting conditions or older age.

        3. BlueSkye ,

          While I think all commerce should open up again ,I still think social distancing and masks would be a good idea for a while.

          The people in nursing homes that were sitting ducks for the virus should of been protected, and should of been removed from day one. They are saying that at least 40 percent of the cases that end up being fatal are from nursing homes .

          Some business is going to have to come up with clever ideas to lure people to feel comfortable like the airlines ,ships and casinos etc.

          But, I’m one person that did lose a love one from germs at the hospital and I witnessed the struggle to breath on a ventilator, about 11 years ago. I know all about it. It was the worse thing I ever witnessed.

          That being said, I still thing all commerce should open up again.

      5. Some poll said that 75 percent still want the lock down. I don’t believe this poll.

        Neither do I.

  3. This may have been posted already on a previous thread:

    “The Fed’s announcement earlier this month that it would take the unprecedented step of buying not only corporate debt but also that of companies recently downgraded to speculative has not actually been put into action yet. But it did provide investors the assurance that the central bank would be there if the market faltered.

    “The biggest issue is really the Fed’s action,” said Rob Peters, director at Intelligize. “They’re trying to take some of the unknowns that the market hates and mitigate them somewhat by providing this backstop, allowing corporations to at least sustain operations until something gets resolved.”

    https://www.cnbc.com/2020/05/01/the-corporate-bond-market-has-been-on-fire-during-the-coronavirus-crisis.html

    I do own some FTBFX so I can collect a few crumbs from the table.

    1. From Houston to New York, America’s Muni Finances Are in Tatters:

      “With tax revenue plunging and unemployment benefit costs skyrocketing, budget shortfalls for state governments alone are projected to swell to more than $650 billion over the next three years, outpacing the Great Recession, according to the Center on Budget and Policy Priorities.

      The stress facing state and local governments’ budgets has boiled over to the bond market, where yields have soared on debt sold by some of the worst-off municipalities. The potential for more credit-rating downgrades and defaults has weighed on the $3.9 trillion market, which has struggled to recover from a historic sell-off in March even after the Federal Reserve launched a short-term lending program last month.

      As the real-life consequences of this financial collapse start to materialize, the rallying cry is growing in Washington to put together an aid package of as much as $1 trillion for municipal governments. But there are mixed messages from the federal government. President Donald Trump on Friday said he’s “in no rush” to provide assistance to states, adding that Democrats would have to make concessions.”

      https://finance.yahoo.com/news/houston-york-america-muni-finances-130000755.html

      I sold off my holdings in a municipal bond money market fund last week, not playing hot potato with that live grenade…

      1. As I have mentioned before our city council wanted to go on a $100M spending spree, financed with a higher sales tax rate. Voters overwhelmingly said no and the city council did their grumpy cat face imitation and accused voters of “not caring for others” because we obviously can’t live without a second rec center or a new library branch.

        Six months later, they now want to raise the sales tax rate again, but this time to make up for falling sales tax receipts. It will be on the November ballot. They’d better practice their grumpy cat faces again.

        What I don’t get is how these people are elected in the first place. We had a fiscally conservative candidate in our ward who lost to the spend, spend, spend! incumbent last November. If it wasn’t for TABOR these clowns would have already raised our sales tax to 10% or more.

  4. Happy Sunday all. Time for another periodic reminder for posters — new and old — to try out the JoshuaTree browser extension to make it easier to navigate the comments section of Ben’s blog — track new comments, ignore posters you dislike, and enable easier formatting of your own comments when posting (bold, italics, etc).

    * for Chrome
    * for Firefox

    As always, the extension is free, but is useless without this blog. So if you use and enjoy it, please donate to Ben to keep our watering hole of truth alive.

    Thank you Ben for your continued efforts!

    1. Love the extension J. One comment not meant to detract. If I post a reply to a comment down in the thread, some of the comments that I haven’t read nested above mine are not obvious if I just hit the “next” button. If I scroll to the top of the page they all light up.

      1. If I post a reply to a comment down in the thread, some of the comments that I haven’t read nested above mine are not obvious if I just hit the “next” button. If I scroll to the top of the page they all light up.

        Doesn’t come across as disparaging at all! I’ve noticed this as well, and haven’t yet come up with a good solution (nor been motivated to spend much time thinking about it 🙂

        At some point the blog behavior changed to immediately show/scroll to the new post (even if pending moderation). As the scroll position is used to figure out which posts are read/seen, this can have the effect of “skipping ahead”.

        Testing any fix to this will require posting test comments, so I want to have a good solution in hand before doing so to not waste Ben’s bandwidth.

      2. I assume you mean new comments that have been added between the time you initially loaded the page and the time you made a comment which refreshes the page.

        Any time I leave a comment, I scroll up to the top before continuing to read. This allows me to make sure I don’t miss anything. I mostly read so it’s not a problem for me.

    2. Thanks for the reminder! I’ve occasionally read about the plug-in but never tried it.

  5. What is your guys experience in Miami, NYC? In Seattle i would have thought that at least 5-10% of owners having their units in the building for sale and then cutting prices, would then have hurt the comps.

    Specially if this was rented to 20’s somethings or AirBnB they buyer would have to spend money fixing things up?

    —–

    Scilipoti’s researchers have discovered that half the country’s property investors (such as the tens of thousands who have bought condo units in towers to rent out) aren’t getting enough cash from tenants to cover their mortgage costs. “There’s only so long they can hold on,” he says, before being forced to sell.

    All it would take to create a sudden oversupply of housing would be for two of 100 more owners in a particular market to list their dwellings for sale, Scilipoti says. “This will take time to play out,” he says, but the downward process is in motion.

  6. The ArB&B thing is shaking out ….Turns out it is not a money tree after all.Especially with a lot of debt and crowded in with other houses.

    Oddly , My daughter & Husband have one set up in central Ohio Amish country, A beautiful 400 sq. feet enclave set up in a woods ,and it’s still filled every night that they make it available ..($125 a night before fees)
    .Think this kind of business will still work ,but people will be much more discerning , they’ll want something more special ,away from people…

      1. Is this Holmes County? About 10 years ago I made a day trip there for sightseeing. I was poking around in an old fashioned hardware store there & heard someone speaking what seemed to be Chinese in the next aisle. That prompted me to take a few semesters of Mandarin at a nearby U.

    1. The ArB&B thing is shaking out ….Turns out it is not a money tree after all.Especially with a lot of debt and crowded in with other houses.

      I do not believe Airbnb was ever a money tree insofar as the actual rental part of the equation is concerned. I think the rapidly increasing phantom equity is what most were after. Not only were they collecting a few pennies here and there on the rental side, they were enjoying $weet profitz from house price hyperinflation, which has now done a u-turn.

  7. 20 years ago I thought we were getting a bunch of fake news by special interest groups just cheerleading their narrative .

    Today the news is so corrupted by special interest that it’s a joke.

    I remember the days when you couldn’t tell what political party a newscaster belonged to. Now facts are slanted toward influencing politics .

    I don’t even know why people engage in these pills. Don’t even let these people know what your thinking so they can figure out how to change your mind or brainwash you or scare you.

    1. I take every poll. Sometimes I lie. Whatever it takes to see what they’re up to.

      I’ve learned some interesting things that way. Probably has more influence than my vote.

      1. I take every poll. I only participate in opinion polls whose first question is, “What state is Columbus, Ohio the capital of?”

  8. When a Governor, Mayor etc declares a Lockdown, one of the conditions should be that the person’s salary is frozen until EVERY restriction to the operation of commerce is lifted. Let THEM apply for unemployment.

    1. “Let THEM apply for unemployment.”

      Unemployment wouldn’t even cover the mistress in the pied-à-terre in the city. Then there’s the kids in college and the highbrow wife.

    2. We wouldn’t be under quarantine if it meant top politicians would stop getting paid.

        1. I wouldn’t go that far. Exhibit A: There’s been a history of government shutdowns without emergency situations that did not include politicians in high places under their scope.

  9. ‘everything revolves around the university,’

    Campus community housing is toast, especially AirBnB, which serves no useful purpose when the campus is closed and football season is on hold.

    My nephew came home from MU this winter with very bad flu symptoms, including a high fever for days on end. He’s one of the few individuals I know personally who got a COVID-19 test. It came back negative.

  10. Thank God for Uncle Warren. And good luck to the airline sector that he just threw under the bus.

    1. “Thank God for Uncle Warren. And good luck to the airline sector that he just threw under the bus.”

      – Some investors would consider the airline industry and cruise lines to be cheap now, but they can get cheaper. Good luck knife-catchers!

      – We recently experienced and maybe/maybe not continuing to experience (?) a massive bear market rally, and so prices aren’t really down that much. The indices/stocks are still too expensive by “normal” metrics.

      – I don’t consider them markets anymore since they’ve been almost completely nationalized. The Fed has recently hinted that they may buy stocks next, and that would remove any doubt. Socialism: The State owns the means of production, and since stocks are supposed to be shares of a company, Q.E.D. It’s my view that you can’t have capitalism w/o capital markets, minimum moral hazard, and actual price discovery. Japan, here we come.

      https://www.cnbc.com/2020/05/02/buffett-on-why-he-hasnt-made-any-big-investments-we-dont-see-anything-that-attractive.html?__source=twitter%7Cmain

      Buffett on why he hasn’t made any big investments: ‘We don’t see anything that attractive’
      Published Sat, May 2 20207:11 PM EDT | Updated Sat, May 2 20207:28 PM EDT
      Fred Imbert

      Key Points

      We have not done anything, because we don’t see anything that attractive to do, said Buffett, chairman and CEO of Berkshire Hathaway.

      Berkshire had a record $137 billion in cash and equivalent instruments by the end of March, according to the company’s latest 10-Q filing.

      1. “Good luck knife-catchers!”

        I know you are supposed to buy when everyone is selling, but I wouldn’t second guess Uncle Warren’s offloading decisions by stepping up to buy and HODL.

        1. One more thing: How is the airline industry executive strategy of squeezing ever more profits out of Anerican passengers by cramming them in like sardines and feeding them starchy junk food working out for them in the social distancing era?

          1. I read that Southwest is reducing ticket sales per flight so that the middle seats are empty. Not sure that will help stop contagion, plus I thought they needed the planes to be packed to make money.

          2. I thought they needed the planes to be packed to make money.

            Maybe cheap fuel has changed that calculation?

          3. Whenever I read about the “keep the middle seat empty” strategy I think does a virus not travel for and aft? Also, since seats average 17 inches wide, keeping the middle empty does nothing. It’s just a show

          4. Buffett revealed it was the wrong decision to invest billions of dollars in the aviation industry.

            I’m sure that while the airlines were making money hand over fist and their stock prices were rising that it seemed like a great idea.

          5. “…plus I thought they needed the planes to be packed to make money.”

            True. Think huge capital outlays, high operating expenses, high security screening expenses and income that requires volume. It’s difficult to see how they survive during the good times. They’re going to get a huge bailout from the fed, IMHO.

          6. It’s not just the airplanes. Travel involves taxis, public transport, airports, car rentals, hotels, and restaurants. Not to mention that your destination is a crowded vacation spot, or somebody else’s office building or a conference center. Meanwhile, I can call up anyone on Skype or Zoom or Webex or just a phone line and get the same information. I think a vaccine will bring back beach travel and cruises. But business travel is dead in the water. Buffet should have sold out of airlines two months ago.

          7. It’s difficult to see how they survive during the good times. There have been so many bankruptcies & airlines going out of business since the beginning of the industry I wonder if that part of transportation has been profitable on the average.

          8. But business travel is dead in the water.

            It’s been dead in the water if you aren’t “customer facing” for a long time.

          9. “Buffet should have sold out of airlines two months ago.”

            Maybe he thought some of the fed’s magic fairy dust was about to be sprinkled?

          10. Fed’s magic fairy dust

            Even if the Fed gave me a billion dollars to invest, I wouldn’t spend it on buggy whips. Not even as a daytrading play. (I’d probably go for Musk’s Boring company.)

        2. “…were making money hand over fist and their stock prices were rising…”

          Do you mean by borrowing at low rates and using the proceeds to artificially pump air into share prices?

          Perhaps Uncle Warren had a peak at how much is $till owed on these share price inflation loans?

          1. Do you mean by borrowing at low rates and using the proceeds to artificially pump air into share prices?

            Yeah they were doing the stock buyback thing, which unfortunately everyone seems to be doing. I recall reading that before virus that Apple was planning on $100B in buy backs this year.

            But the majors were making good profits. The minors, like Frontier and Spirit, not so much.

  11. – This sentiment applies to U.S., Au, etc., IMHO.

    From Burnaby Now in Canada. “People laughed and choked on their morning coffee recently when it was reported that Airbnb actually had the gall to lobby the Canadian government for financial relief and tax breaks for its hosts. In Burnaby, we’ve seen how much of a panic these hosts are in because they have flooded the local rental market with ‘furnished’ units that are offered on a month-by-month basis. Sorry, but I have zero sympathy. Airbnb was originally pitched as a way for people to rent out a spare bedroom once in a while to make extra money.

    Today, it’s people running their own mini-hotel chains. I’m sorry you are mortgaged to the hilt, but you’ve exploited our housing market for years so bye, Felicia. Don’t expect taxpayers to care.

    – “Don’t do the crime if you can’t do the time.”

  12. A report from Business Den in Colorado. “When it comes to future development — things that have yet to break ground — it’s feeling like the end of a cycle.’Projects that are getting built will obviously get finished, but when I can go out and buy a distressed asset at half the price I can build it new, it doesn’t take a genius to figure out what’s going to happen there … I think new development is on hold for, pick a time frame — a year, two years, three years,’ said Rhys Duggan, president and CEO of Denver-based Revesco Properties.”

    I will be watching carefully to see if this spills over into Silicon Valley…There have been massive commitments of development capital here by the biggest players in the world…Boston Properties just tapped the brakes on a downtown San Jose development…Google appears to be tapping the brakes on a huge new campus in Mt. View…Scuttle-butt is that Google is looking for better numbers from the developer…We shall see…Related Cos. has the earth movers on the massive retail/residential development on the shuttered Santa Clara Golf Course…Will see if they continue pushing dirt around starting tomorrow…

    I have seen this movie before….Late eighties early nineties S&L meltdown…lots of see through buildings for many, many years…

    1. Would be interested in hearing your thoughts about how this massive forced experiment in teleworking is going to affect real estate in Silly Valley and Seattle.

      1. If the California central planners had an ounce of sense instead of rocks in their heads, they would seize on this opportunity to adopt measures to incentivize continued widespread teleworking after the end of lockdown. Benefits would include reduced freeway congestion; lower delivery, policing, vehicle maintenance and road maintenance costs; decreased fuel consumption and costs; faster commute times; and reduced toxic air pollution and greenhouse gas emissions. In short, this could be a free economic boon and lasting serendipitous effect of the otherwise painful quarantine measures.

        From what I know of politicians, I am not holding out hope.

        1. While telework has some negatives, I am still able to do my work, with the added benefit of no commute, more time for sleep/leisure, and the opportunity for exercise midday.

          I haven’t bought gasoline since early March. My tires are not being worn. Lots of savings there. My old Civic is getting less miles, so it will last even longer!

          I’m hoping for one or two days a week in the office after this whole thing ends.

          1. I’m hoping for one or two days a week in the office after this whole thing ends.

            Same here, with the ability to transition to 100% remote work in a year or so (part of the retirement plan)

          2. I haven’t bought gasoline since early March.

            Ditto, and it still has half a tank.

          3. “I haven’t bought gasoline since early March.”

            You should add a can of fuel additive and drive the vehicle for 15-min every two weeks. The fuel in the tank needs sloshing to stay mixed, and rubber parts like valve stem seals and rear main seal need to stay moistened with warm oil to prevent hardening.

          4. Hey rms, thanks for the fuel additive suggestion. As a road warrior who has logged over 15,000 driving miles probably every year back to 1987 or so, I’m not accustomed to keeping my car in the garage for weeks on end. This may be the first year in over 30 with significantly lower driving miles. Drive to Costco on Saturday was the first time out of the garage in over a week!

          5. I still take the car out for a 30-40 mile country drive every week or so, despite the stay-at-home orders. I’m not terribly worried about buying gas. That’s pretty socially distanced. I just drench my hands with 70% alcohol afterwards.

      2. Well Oxide, It appears we are on the cusp of significant changes in the way we operate from the tech giants all they way down to the Subway business owner…

        I think the “work from home” model has been and continues to be tested…From everyone I speak to they are declaring it doable…My son worked at several large tech companies in HR so he has many contacts with solid information…If, working from home is acceptable to big tech, then why pay $175,000. a year for someone to work out of there home in Santa Clara when you can have someone, even the same person work out of a Sacramento home (or anywhere for that matter) and maybe pay them $90,000….Don’t want to accept $90,000. then we will find someone that will…Companies save in many ways but the obvious is less office space needed and half the pay for the same work…

        Tech office design is going to change dramatically…No more bull-pen teams…No more “open” floor plan…6 foot separation for each cubicle…Also, much wider hallways with direction lanes that you must follow…Much bigger bathrooms…Tennant improvement guys are going to be real busy…

        As far as real estate, acceptance to the “work from home” consept could be the impetus that could change the trajectory of home prices…For many years now the “driver” has been the lack of inventory near job markets that continue to grow, high cost to entry and the high rate of pay…If even one of those three change significantly, there is no question there will be downward pressure on home values…If all three change (which they could) then the revisions downward could be significant…

        From the commercial side, we are already seeing signs of “winds of change”…Will see…No way to really no until we start to understand what the new normal is going to be…Small retail & office are going to take a massive body blow…Even if the virus goes away in a whimper, I don’t see how we could go back to where we were…

        1. Bricks and mortar structures that depend on high occupancy demand to support their bubble prices are TOAST.

        2. Mrs Spiffy works for a group owned by one of the biggest health insurance companies. Working from home mostly works for people in her compnay, but there are sharp edges due to HIPPA and data security requirements. But even with that, this current situation has opened the discussion to make WFH a larger part of their plans even after the mythical ‘all clear’

        3. I meant to add: another friend and former co-worker from the house of mouse now works at Raytheon in the Missiles & Defense group. Secure rooms aren’t going away there. period.

          1. That’s a switch!

            He’s a world-class firmware engineer. He had multiple people bidding for his services.

            As the Playmation toy line was about to launch for Christmas and already on the production line at Hasbro, I found a rather critical vulnerability – if the main unit – a toy meant for rough and tumble play by 5-10 year old boys – was to suddenly lose power because say.. the battery cover popped off and a battery fell out – the whole thing would be bricked. He and I sequestered ourselves and burned the midnight oil and came up with a solution that could be pushed as part of the initial toy setup so it would reset, but not brick on unexpected power loss. Guys who can solve problems like that, and literally save Christmas (for the product group) are rather hard to come by.

          2. Thank you MG for giving us non programmers an idea of what problems you face and why you are worth 6 figures….

          3. the whole thing would be bricked

            That sounds like one heck of a design flaw. I mean, not even Windoze bricks if power is lost while running.

          4. That sounds like one heck of a design flaw. I mean, not even Windoze bricks if power is lost while running.

            The BOM for the ‘computer’ part of the toy was only about $4 or so in total – it’s a low power, low-speed ARM SoC from a Chinese supplier. Power-wise it’s similar to a 486-25 from 1990. Cost of goods was so tight that even though the primary way it interacted was via playing audio, the higher ups refused to approve paying $0.25 per unit to license using the built in MP3 decoder on the SoC. So we were blowing most of the CPU cycles on software decoding an open-source audio codec.

            The failure point was the NAND flash chip and the choice of filesystem used (FAT because of royalties/licensing). Unlike a SSD, or hard drive that we are used this, this was literally a single NAND chip wired straight to the SoC which had a primitive controller. The problem is in the way the NAND flash works – you can write new sectors to it, but they don’t actually write over the old sectors with the same number/address. TL;DR – it has to be committed in a process of erasing old blocks and repacking them, which unfortunately would ‘freeze’ the whole think up for a second or more (Chinese vendor’s closed source driver) which was not acceptable. If you kill power and come back later without doing that, you lose a lot of write transactions because the hidden linkage needed to find them isn’t there. And it you will also lose access to other sectors in the same NAND block, even though you didn’t write to them. NAND at a low level behaves very differently the disk platters we’ve known for decades.

            But back to your point – you’re right – our testers did not think to force the case of “Battery falls out of compartment”. There were a few incidents of bricked units, but we had a special machine to reset/unbrick them and they would just take it over to that. Nobody bothered to ask “why?” until I did.

            Anyway, I’m rambling waaay too much.

          5. Anyway, I’m rambling waaay too much.

            Hahah, as a former embedded guy and currently SSD reliability guy I like it.

          6. Anyway, I’m rambling waaay too much

            Thanks for sharing, that was interesting.

          7. “…the higher ups refused to approve paying $0.25 per unit to license using the built in MP3 decoder on the SoC.”

            Understood. My last shop was running their engineering dept on a shoestring.

        4. Good thoughts, scdave.

          I don’t think we’re going to see the total demise of the office building. But I think the New York COVID crises really puts a dent in the appeal of the “vibrant” city. It will bring us closer to my ideal of smaller offices of 500-1000 employees, spread out around the country. I mean, think about it, do you really interact, in person, with more than that in a year? Your division or unit still gets the synergy of physically working together, but you can fit everyone into two small office buildings in some small city. Cheap housing, lots of roads. If you need to interact with other divisions of the company, then you can skype, or they can travel for a couple weeks if they have to. But at least people aren’t commuting every day.

          1. people aren’t commuting every day.

            Maybe we can have a whole economy of people talking about things.

          2. Maybe we can have a whole economy of people talking about things.

            Reminds me of some stress I had with my wife a couple of weeks ago. She didn’t understand why I got so stressed when she interrupted me all the time during the work day when I wasn’t on a meeting. I had to explain that the meetings were just talking about what we were going to do. The time between was when the work actually got done and I only had a couple of hours for that and every time she interrupted me it was a major problem that was going to ruin our evening later. She thought the meetings were the real work and everything else was just me playing online.

          3. She thought the meetings were the real work and everything else was just me playing online.

            Understandable, as all the big bosses do is talk and make decisions. It’s easy to forget that someone has to actually implement those decisions, and more often than not it isn’t easy.

        5. I wonder if the work from home recruiting teams will be limiting their search to domestic talent?

          1. And I was wondering that too. My guess is that it won’t make that much difference. If you can pay an American $75K in Peoria instead of $160K in San Jose, then you will find an H1-B who will work fro $50K in Peoria. Or even worse, they simply outsource every tech job entirely.
            As the saying goes, “if you can your job from computer in Peoria, then Hari can do your job from his computer in Mumbai,” and outsource work entirely.

          2. As the saying goes, “if you can your job from computer in Peoria, then Hari can do your job from his computer in Mumbai,” and outsource work entirely.

            ^^This.

          3. Having work done 12 time zones away from where decisions are made can slow things down a bit. If the coder in Bangalore has a question, he won’t get an answer from the architect or project lead in San Jose until the next day, and if it requires clarification, it can take another 24 hours, all of which could be resolved in less than an hour within a common time zone.

            There’s a reason why so many are brought here as H-1B’s

          4. 12 time zones away

            I supported a project in Korea for a couple of years. I took calls in the middle of the night.

    2. Related Cos. has the earth movers on the massive retail/residential development on the shuttered Santa Clara Golf Course

      I wonder what the iconic Sun (now Oracle) Santa Clara campus looks like deserted? Other than the server farms it contains, there isn’t much activity there these days. My Bay Aryan colleagues are getting cabin fever working from home, especially when the spouse is also WFH and there are kids involved.

      1. My Bay Aryan colleagues are getting cabin fever working from home, especially when the spouse is also WFH and there are kids involved.

        Yeah, that’s the key. I love working from home…but wasn’t expecting how difficult it would be when everybody else is home too. I need my own office. With a lock.

      2. I wonder what the iconic Sun (now Oracle) Santa Clara campus looks like deserted ??

        I drive by it almost daily…Looks like Christmas day every day…

      3. “My Bay Aryan colleagues are getting cabin fever working from home, especially when the spouse is also WFH and there are kids involved.”

        In California I could go somewhere active all year round. Now up north with icy winters you spend months together indoors, so you have a taste of retirement with your spouse. For WFH, I’d need a basement office, or rent a contractor’s office trailer and park it on the driveway.

  13. From Nine News in Australia. An oversupply of vacant apartments and homes and a lack of demand has seen rents slashed across Sydney. A two-bedroom apartment literally across the road from Bondi Beach has been cut from $920 a week to $650. On the other side of the harbour in Manly, a two-bedroom, two-bathroom unit with parking is reduced by $300 a week to $500 for the first six months. Zero tourists, no immigrants, a flood of properties that were once used for Airbnb and new apartment blocks being completed have created a massive oversupply of units when demand is simply not there.

    Real estate agents say it’s dire. And they’re having to slash asking rents to attract tenants. ‘We’ve seen in some situations up to 25 to 30 per cent drops on some properties,’ said agent Ric Serrao of Raine & Horne Double Bay. Our suburbs now littered with For Lease signboards.”

    – And so the global real estate bubble, RRE/CRE/Airbnb pops. It was unsustainable. A couple of rules-of-thumb that, if I were a RE investor, I would apply:

    – 1) Long-term cap. rate of at least 7 (avg.). 10-14 is good value. In some cases we’re currently at 3-5. You paid too much!

    – 2) Long-term median house price to income ratio of about 3:1 is sustainable, along with 20% down + 33% DTI (principal, interest, taxes, insurance only (PITI), and not including maintenance and other debt). We have some markets at 10:1. You paid too much!

    – So how did (1) and (2) get so crazy?

    – A) The massive move toward centrally-planned, command-and-control economies by governments an central banks, at least since the Greenspan era. Don’t forget that Socialism has always failed both socially and economically wherever it has been tried. We’re going to make sure one more time, just to make sure. Keynes was a “Progressive.”

    – B) The dominance of the financial, insurance, and real estate (FIRE) sector in the global economies combined with crony-capitalism. Recall that neither governments, nor the FIRE sector actually produce anything, but since the real manufacturing sector was outsourced by the globalists, something was needed to fill the void. Enter financial engineering, which mostly substituted debt (slavery) for income (freedom). Recall that debt is not wealth. A healthy balance sheet (sovereign nations, corporations, families) requires assets > liabilities. That’s been turned on its head for the 99%, while the 1% are doing quite well thank you very much.

    1. That pic looks like it was taken in suburban Maryland, just outside of the District of Corruption.

      1. Marylanders know how to properly cover a donk’s mouth. Clearly, the pic is Northern Virginia. 🙄

  14. Santa Clara, CA Housing Prices Crater 10% YOY As One Bay Area Broker Conceded, “Sellers Are Willing To Take A Loss Just To Escape From Bay Area”

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

    *Select price from dropdown menu on first chart

    As a noted economist stated, “A house is a rapidly depreciating asset that empties your wallet every day it owns you.”

    1. Can’t wait to watch Trumpy and Biden trade barbs on sexual harassment allegations. Got popcorn?

      1. In and of itself, that could be interesting, but I’d rather see them discussing matters of policy that actually have impact on voters.

        But watching everyone on the left twist themselves into a “no, this is not the same thing” pretzel over it is hilarious.

        I’m actually hoping Joe chooses her, and gets her out of Lansing so that the state can start repairing all of the damage she has caused.

        1. But watching everyone on the left twist themselves into a “no, this is not the same thing” pretzel over it is hilarious ??

          Yeah…Kind of like watching all the evangelicals twist themselves into a pretzel justifying their support for DJT…Hypocrite bassturds.

          1. Kind of like watching all the evangelicals twist themselves into a pretzel justifying their support for DJT…Hypocrite bassturds.

            So they should have voted for the Hildebeast?

          2. I don’t feel the need to twist myself into knots over supporting Trump. I like Trump’s policies of curbing immigration and wresting American ingenuity back from China. Does he lie, does he cheat, does he say the darndest things? Sure. But I would rather have that, than a Democrat who’s squeaky-clean, speaks very politely … and then gives away the store.

            But I need to see what things look like in November. Trump hasn’t handled COVID well at all. But question is, would a Dem have done better? My guess is maybe, but not much. You might have had better messaging, but I’m skeptical if the case count would have been any lower.

          3. a Democrat who’s squeaky-clean, speaks very politely

            😂🤣😂🤣😂🤣

          4. To be clear, my response would be the same for Republicans. Career politicians are corrupt and controlled.

          5. Difference is Trump never publicly denigrated Evangelicals or religious folks in general. In fact, publicly, he’s said nothing but nice things about them.

            So who do you vote for — the Clinton campaign, which disparaged Catholics for their beliefs in their internal emails, or Trump, the guy who says he thinks the religious are Great Americans on TV?

          6. I don’t feel the need to twist myself into knots over supporting Trump.

            I don’t like him, but if the choice is between him and she whose name must not be mentioned …

  15. Not true in Sacramento, California only 3k homes for sale under 500k. Homes selling or pending in 2 weeks. Where is the decline?

    1. I guess someone will figure out how to pay for this later?

      And with Unlimited Quarantinive Easing, this will be no problem, regardless of the eventual amount.

      Business
      Analysis
      The U.S. has thrown more than $6 trillion at the coronavirus crisis. That number could grow.
      Between Congress and the Federal Reserve, the government has committed record levels to try to stop an economic calamity — with just limited success.
      A woman visits an empty Vietnam Veterans Memorial on April 14 in Washington.
      (Drew Angerer/Getty Images)
      Image without a caption
      By Andrew Van Dam
      April 15, 2020 at 9:26 a.m. PDT

      In late February, the Trump administration said it planned to spend $2.5 billion to fight the coronavirus. A month and a half later, President Trump signed off on spending almost a thousand times as much — $2.35 trillion. And that amount doesn’t include the Federal Reserve’s efforts, which are harder to measure but seem likely to blow past the $4 trillion mark.

      The dual rescues, each historic in its own way, put the country on track to eclipse World War II-era highs in the national debt and the Federal Reserve’s balance sheet.

      All told, the U.S. government has committed more than $6 trillion to arrest the economic downturn from the pandemic. The moves appear to have calmed stock market investors but may not be enough to hold the economy together if the health crisis drags through the summer.
      AD

      Keep Reading

      When you combine the steps taken by Congress and the Fed and account for how the two interact, America’s national coronavirus response represents more than a quarter of U.S. economic output. To feel the weight of that sentence, try thinking of “quarter” as a measure of time, not a fraction.

      It’s a quarter of GDP. That is to say, the response from Congress and the Fed totals significantly more than the $5.4 trillion of goods and services spewed forth by the U.S. economy in the fourth quarter of 2019.

      Consider everything the government studies to estimate gross domestic product: military wages and pensions, record sales, toll booth returns on local highways, high school sports participation, sewage-collection receipts, manufactured-home shipments and even the value of meals farmers grow for themselves. There are about 2,500 measurements like that, and the coronavirus response could easily purchase everything they represent for more than three months.
      AD

      Sign up for our Coronavirus Updates newsletter to track the outbreak. All stories linked in the newsletter are free to access.
      The fiscal response

      The three phases of congressional stimulus are relatively straightforward: There’s $8.3 billion in response to Trump’s $2.5 billion request, $192 billion for an act extending paid leave and an estimated $2.15 trillion for the Cares Act.

      On its face, that’s the largest covid-19 response of any government in the world, according to Columbia University economist Ceyhun Elgin. In fact, it’s larger than the entire annual economic output of Italy, Brazil and all but seven countries.

      1. Sorry for bad editing on my phone. If you don’t have time to read the whole article, ponder this one paragraph:

        “It’s a quarter of GDP. That is to say, the response from Congress and the Fed totals significantly more than the $5.4 trillion of goods and services spewed forth by the U.S. economy in the fourth quarter of 2019.”

        The upshot: We’re going into debt faster than the normal rate of U.S. economic production.

        1. Question for anyone who thinks they know: Is there any difference between another dollar added to the national debt by Congress and another dollar added to the Fed’s magical, ever-growing balance sheet?

      2. “appear to have calmed stock market investors”

        The S&P 500 will end below 2,500 next week.

        1. It was overvalued 20 years ago at 1500.

          Are business prospects better now, and debt levels lower?

          1. I can’t answer that, but I’ve been calmed by not owning any stocks. That and not having any debt makes me sleep really well at night.

          1. I had a peak at some U.S. COVID-19 stats. All but a few thousand of the deaths so far occurred in April. Total deaths have grown at roughly a linear rate since April 18. If this held up through May, we’d cross the 100,000 threshold around 17 days from now (May 20):

            (100000-66385)/((66385-37054)/15) = 17.2

          2. “peek” (Apparently I’ve been reading too much about peak oil and peak COVID-19 deaths lately!)

          3. If this held up through May

            Not that long ago we were watching it double every three days, so things could be a lot worse.

            Not sure it’s actually known that it is more contagious than a flu.

          4. It is definitely known that COVID is much more contagious than flu. The 1918 flu had an R-naught of around 2.2. H1N1 swine flu was R naught 1.5. The R-naught Wuhan outbreak of COVID was estimated between 4 and 5. That’s because people are contagious for many days, contagious with no symptoms, and contagious through air droplets. Without any preventative measures, the cases would double every 3 days.

            Source: https://www.healthline.com/health/r-nought-reproduction-number#covid-19-r-0

          5. It is definitely known

            Not at all. All the models based on this “truth” have been wrong.

            I’m not pretending to KNOW much of anything. I just don’t trust those who do. I know only a fraction of what I knew 40 years ago, and most of that is stuff I didn’t know then.

          6. “Not that long ago we were watching it double every three days, so things could be a lot worse.”

            Before quarantine, in particular.

        1. Lets hope so we just bought a nice queen size plush bed for $800 and its wonderful sleeping soundly again….. i could use an updated mac mini for video work….hmmmm I did splurge and bought 20 lbs each of chicken and beef and some sausages so the freezer is full, so is the pantry, beans tuna canned fruits cereal, Plenty of polander jellies they had a 3 day 2 for 1 special here…… so bring on the shortages.

    1. Sorry dude but Lincoln is NOT Sacramento but way far like 30 miles northeast. Way to far of a commute if you work downtown. BUT prices and inventory are nuts in midtown, east, Curtis park areas. Hell, a place on 23rd and V Street just listed for 650k this past week for a 1600 square foot home with a tiny ass yard and tiny garage.

      1. If Mafia Block’s comments, or anyone else’s for that matter, bother you, install drumminj’s Joshua Tree Extension and enjoy the Ignore List. HBB regulars see protestations like yours on a regular basis.

  16. Regarding the viral load discussion – I read this article about a week ago and I keep it stored in the back of my mind. If I get sick, I plan on rinsing my sinuses with salt water with a little hydrogen peroxide.

    “…according to Amy Baxter, MD. The Atlanta-based doctor known for creative solutions to long-standing medical challenges is touting a lesser-discussed method to combat the progression of COVID-19 in patients who are positive: nasal irrigation.

    “Nasal irrigation, or a nasal wash, has long been considered an effective way to remove viruses or bacteria from sinus cavities. According to Baxter, recent clinical trials show that nasal irrigation reduces the duration and symptoms for other viral illnesses like flu and the common cold, though it hasn’t yet been studied for COVID-19. Still, she has multiple reasons for believing that this approach can be effective in preventing coronavirus from worsening in a sick patient. Firstly, she says, “SARS-CoV2’s viral load is heaviest in sinuses/nasal cavity.”

    https://bestlifeonline.com/nasal-irrigation-covid-19/

    1. Please do not introduce any hydrogen peroxide inside your nose. It devours healthy tissue, and some of the tissue in your nose is pretty important. Just make sure the salt water and container are sterile (boil it) and you don’t need the hydrogen peroxide.

      1. I was wondering about that.

        I’d venture to guess that one shouldn’t inject H2O2, either. Oxide?

        1. inject

          The MSM totally mischaracterized what DJT said in that press conference about disinfectants. I make a point of watching press conferences in real-time to avoid media spin. It’s honestly frightening to hear that people believe what the MSM tells them.

  17. Warren Buffett personal finance advice: ‘Avoid using credit cards as a piggy bank’
    https://money.yahoo.com/warren-buffett-personal-finance-advice-155820715.html

    (snip)

    “Buffett recalled that a woman had come to see him some time ago — a friend of his — to ask what she should do with some money she had just come into.

    “’She said what should I do with it? And I said: What do you owe on your credit card?’ Buffett recalled. ‘And she said, well I owe X. And I said, what you should do — I don’t know what interest rate she was paying but … it was something like 18%.’

    “’I don’t know how to make 18%’, Buffett added. ‘If I owed any money at 18%, the first thing I’d do with any money I had would be to pay it off.’

    “Because paying it off is ‘gonna be way better than any investment idea that I’ve got,’ he stressed.”

    Okay folks, wait for it …

    (drum roll)

    “‘And that wasn’t what she wanted to hear.’”

    Bahahahahahahahahanahaha. What a totally dumbed-down ignorant puke.

        1. One of the best lines in Shakespeare that bankers everywhere wish he’d never have written…

  18. Asking prices were dropped and negotiations took place to close the deal.

    The greedheads of 2018 and 2019 are learning that nothing is more expensive than regret.

  19. For example, a vacant parcel of land at 5644A Westport Road in West Vancouver sold on April 22 for $1,075,000.The asking price was $1,495,000. That’s not all. The assessed value was $2,124,000 in 2019, meaning the recent sales price was 49 percent lower than that.

    Wait’ll you get a load of the next sales price.

  20. ‘It’s not the right time to sell right now. So if you do see a listing coming out, you assume it’s someone who’s motivated to sell.’”

    That’s right, Stephen, they’re motivated to GTFO now because this is as good as it gets, and it’s all downhill from here.

      1. Accept the first offer you receive at 25% below asking price, wash your hands of your mistake, and move on with your life…

  21. “Today, it’s people running their own mini-hotel chains. I’m sorry you are mortgaged to the hilt, but you’ve exploited our housing market for years so bye, Felicia. Don’t expect taxpayers to care.”

    Taxpayers may not care, but renters are downright gleeful to see these speculators get their heads handed to them.

    1. These parasites ruined Crested Butte, which was only a few years ago called “the last great ski town in America.”

      I hope their lives either end in suicide, or in decades of grinding poverty with them eating cat food and cutting their pills in half.

      DIE SPECULATOR SCUM.

      1. This has happened everywhere. At a certain point isn’t it the policy, not the people? Why is this even allowed? Housing should be shelter, not illegal hotels and speculative purchases to capture massive appreciation. It has to do with the financialization of the entire economy. Or, in other words, it’s the scumbag bankers, and they’re still busy at it. Until we get rid of the central banker garbage, it will continue.

    2. but renters are downright gleeful

      I think far too many renters are busy scrambling and wondering how they’re going to pay May’s rent to be “gleeful”.

  22. If the economic crisis were to seriously worsen, it said, house prices could fall by 10 per cent this year, then by another 10.9 per cent in 2021, then by a further 12.9 per cent in 2022. Overall, property values could fall by 30.2 per cent over three years, which would be unprecedented in modern times.

    Or they could fall 60 percent. Trillions in fictitious valuations are going to get wiped away as the fraud of Keynesian monetary policy results in a financial wipeout of Biblical proportions.

    1. Hypothetically, couldn’t the Fed use Unlimited Quarantinive Easing to prop up real estate? They did something like this last time.

      I realize that this time is different.

      1. We’re about to find out what kinds of market distortions the FED can create through their unlimited QE and balance sheet.

      2. Hypothetically, couldn’t the Fed use Unlimited Quarantinive Easing to prop up real estate?

        As long as people are willing to take dollars for it. And that goes for everything, not just real estate.

        1. The shortcoming of lending out money as a stimulus plan is that someone has to borrow it.

          1. AND someone has to repay it.

            I helped judge an online student debate competition yesterday. One of the prompts for a one-on-one debate was, “The Federal government should forgive all student loan debt.” The young lady taking the Negative side used a fairness argument to destroy the position of the young man on the Affirmative side of the argument.

      3. We already began learning about that back in 2009. The lessons are getting more intense lately, though.

  23. Owner-occupiers furloughed on 80 per cent pay or the self-employed with no money coming in have quickly become vulnerable.”

    And they’re about to get vulnered, good and hard.

        1. 4 bd2.5 ba2,470 sqft
          14 Coral Ln, Foster City, CA 94404
          Auction

          Foreclosure information
          12/3/2019 Foreclosure auction $356,821 unpaid balance
          A loan was issued on 8/5/1999.
          This home last sold for $645,000.

          https://www.zillow.com/homedetails/14-Coral-Ln-Foster-City-CA-94404/15614787_zpid/

          Opening Bid $1,550,000

          This is a strange story. Info is often incomplete, but it’s likely multiple loans are keeping the FB from selling. The common factor in these is they are underwater. They’ve had plenty of time to unload it. Fact is, if you cash out refi or get a second (or a third) the underwriting is a joke. They take their commission and move on to the next.

        1. Demographics is destiny. City always had really bad parts but now the whole place is ghetto. Most of the state is headed that way but residents don’t perceive it, you have to go away for a while and when you come back you’ll be shocked.

  24. Housing prices were cratering long before CoronaScam. CoronaScam provides convenient cover though.

    Silver Spring, MD Housing Prices Crater 15% YOY As Northern Virginia/Washington DC Rental Rates Tank On Surging Mortgage Defaults

    https://www.movoto.com/silver-spring-md/market-trends/

    As one Washington DC broker conceded, “If you’re a buyer, the broker is lying to you. I know a liar when I hear one. I’ve been lying my entire life.”

    1. “CoronaScam provides convenient cover though.”

      Yes it does.

      Mortgage lenders demand higher credit scores as the coronavirus threatens the housing market
      by Natalie Campisi, Updated: April 23, 2020
      Mortgage lenders demand higher credit scores as the coronavirus threatens the housing market
      Adam Cairns / MCT

      Mortgage lenders are battling economic uncertainty by raising minimum credit scores, requiring higher down payments, triple-checking employment status, and even eliminating certain loan types altogether.

      As job loss reached staggering heights due to the coronavirus pandemic (more than 16.8 million workers have filed jobless claims in the last two weeks), fear strikes deep among lenders worried that high unemployment numbers will translate into mortgage defaults and late payments down the road.

      Chase recently announced that it would raise its minimum credit score requirement to 700 and hike the minimum down payment up to 20 percent, from 3.5 percent. Lenders large and small across the country are following suit.

      Wells Fargo and US Bank both adjusted their minimum score requirement to 680 (including for FHA and VA loans, which typically feature credit-score requirements as low as 580), while Flagstar Bank increased its minimum to 640.

      1. “Chase recently announced that it would raise its minimum credit score requirement to 700 and hike the minimum down payment up to 20 percent, from 3.5 percent. Lenders large and small across the country are following suit.”

        20 percent of the median February 2020 San Diego home price of $647,000 is almost $130,000. How many San Diego home buyers have $130,000 lying around to provide the proceeds for a down payment on the median price home, and how many of those individuals are interested in buying a home at the moment?

        The approximate answer to both questions is 0.

        Real Estate News
        San Diego home prices in February were rising fastest in California before pandemic
        San Diego home prices were surging before COVID-19. Pictured: A home at 303 Corte Nacion in Chula Vista is listed for sale at $589,000 last summer.
        (Sam Hodgson/The San Diego Union-Tribune)
        In the month before COVID-19 job losses, San Diego County home prices were surging
        By Phillip Molnar
        April 28, 2020
        12:29 PM

        San Diego County homebuyers, like most of the nation, shrugged off early COVID-19 fears in February as prices increased more than any other California market.

        Home prices in the San Diego metropolitan area had risen 4.6 percent in a year, the S&P CoreLogic Case-Shiller Indices reported Tuesday.

        The index reflects a strong economy up until the moment the coronavirus began entering the American psyche and massive job losses followed. All home prices in the 20-city index were up and the nationwide average yearly increase was 4.2 percent.

        Selma Hepp, deputy chief economist for CoreLogic, said the report showed enthusiasm for home purchases in February for a variety of reasons.

        “Home buyers, particularly millennials, were encouraged by falling mortgage rates and a strong employment market,” she wrote in an analysis.

        Phoenix had the biggest yearly gain, up 7.5 percent, and was followed by Seattle at 6 percent. Both Charlotte and Tampa were up 5.2 percent. Chicago had the smallest gain at 0.7 percent.

        The February report is another example of data that lags the major disruption to the economy. Similarly, the U.S. Census Bureau released its first-quarter homeownership report Tuesday that showed a sign of improving economic lives of some Americans. The national homeownership rate reached 65.3 percent, its highest level in almost eight years.

        The Case-Shiller indices take into consideration repeat sales of identical single-family houses as they turn over through the years. Prices are adjusted for seasonal swings. The San Diego County median home price for a resale single-family home in February was $647,000, said CoreLogic data provided by DQNews.

        1. Doing the math a little differently might help to make my point. Hang on…I have to refill my wine glass. I’ll be back shortly with more real estate maths. 🙂

          1. Suppose a typical San Diego buyer, who could have just barely afforded to make a 3.5% downpayment on the median-priced home in February 2020, decided to go house shopping today. The amount he has saved up for a downpayment is 3.5% of $647,000, or $22,645. Assuming his credit score is 680 or higher, so that he can still find someone willing to make him a loan, the price he can “afford” to pay now on a purchase, P, is defined by this equation:

            $22,645 = 20% of P.

            Apparently the highest price he can now “afford” with a 20% downpayment requirement is $113,225:

            20% of $113,225 = $22,645.

            Does anyone else besides me see a slight problem here for wannabe sellers? They’d better start a hoping and a praying that the Fed regards housing prices dropping below early 2020 bubble levels as a national emergency.

          2. Apparently the highest price he can now “afford” with a 20% downpayment requirement is $113,225

            If he was one of those 50 million out of work, it is an uglier story.

            Does taking advantage of rent forbearance blow a hole in the debtors credit rating?

          3. BlueSkye, my example is only one of myriad holes recently blasted in residential RE demand, which also includes tightening credit standards, massive job loss at 1930s levels, and the disappearance of the wealthy all-cash Chinese investors that were outbidding everyone else on the West Coast just a couple of years ago. The market is effectively shut down without the foot traffic that is its life blood.
            Plus nobody wants to catch himself a falling knife. There’s so much crater in demand that it’s hard to fathom it or describe it.

            Which reminds me: Where did the geniuses go who said real estate would go up due to COVID-19?

  25. The 80% pay in the UK sounds generous, as always the devil is in the detail

    I’d you cannot maintain your current workforce because your operations have been severely affected by coronavirus (COVID-19), you can furlough employees and apply for a grant that covers 80% of their usual monthly wage costs, up to £2,500

    Some employers pay all your wages ( if your wages are above £30,000 a year), some pay £2,500 ( effectively paying 20% of the £2,500 i.e £500) and some just pay the 80% ( £2,000). Others have just thought no point in keeping staff and have made them redundant. The furlough scheme is also time limited; already there are screams to extend it past June.

    1. Has the UK been able to set up the bureaucracy to handle these subsidies?

      I ask because over half the US population still hasn’t received their promised $1200 stimulus checks, and by some accounts many won’t be receiving them until as late as August.

      1. In a word no. They expect the employer to pay out and claim it back in June. Can you see the obvious problem with that, because our government can’t.

        1. That’s what I figured. When I first read about that program the first thing I thought was “it’s going to take forever to get that money to insolvent employers.”

        1. Per the IRS website, mine should be direct deposited this week. We’ll see how that goes.

    1. Mr Market is also unconvinced by the sea of foam that the money printing binge has churned.

      Dow futures fall nearly 300 points Sunday evening as U.S. states attempt coronavirus reopenings
      Published: May 3, 2020 at 6:22 p.m. ET
      By Mark DeCambre
      Referenced Symbols
      YMM20
      -1.38%
      DJIA
      -2.55%
      ESM20
      -1.38%
      SPX
      -2.80%
      NQM20
      -1.31%
      BRK.A
      -2.74%

      U.S. stock-index futures fell sharply in thin trading Sunday evening as investors contended with state reopenings, with cooped-up citizens eager to to gather as spring has brought warmer weather conditions.

    2. He doesn’t have insider info like he did with Ozero. Now he’s exposed as the reverse Midas, fancy that.

  26. If Covid follows the Spainish flu model, there may be a second, even more deadly recurrence next year. Welcome to the new normal. The old days of globalism and money printing are over. There’s a new day dawning of personal responsibility and self sufficiency.

    1. We’re not even done with the first wave. There’s no sign of a summer letup like for regular flu. But we will definitely have a second wave when these lockdowns are lifted and kids go back to school in the fall.

      1. There’s no sign of a summer letup

        The plague is already over in the number one hotspot NYC.

        But we will definitely have a second wave

        Lucky you, knowing something absolutely no one knows.

    2. Mega Mike,

      It might be true that what you say does happen in the long run.

      I’m a little concerned about Communist takeover going into the near future.

      1. Does anybody know if rain kills the virus? I still think they can do more with inventions to kill the virus in the air in enclosed spaces.

      2. Covid-19 is in the process of killing communism and totalitarianism, though it may take a while. They will be in retreat from now on for many years. It’s the only good thing to come out of this.

        1. The media silence out of the middle-east has been deafening, and I’m sure “our friends” are counting on similar results.

        2. Negative oil prices and a complete absence of freeway traffic are beyond awesome, IMO.

    1. I can’t bring myself to watch the interview but exercising your constitutional rights is now racist? WTF?!

      1. but exercising your constitutional rights is now racist?

        Don’t expect The Narrative to be logical or make sense. It’s called propaganda for a reason.

        1. The reasoning is probably those rights derive from antiquated and outdated document written by old white men who owned slaves.

  27. I’m not sick, I don’t go out much, but I take my vitamins every day and feel fine. Thanks for the long Redpilled post, I didn’t see a Reply button for it but wanted to say thanks.

  28. Also, I am happy because I saved for a rainy day, and it happened. It happened. I only got about $50K cash in the bank, and a lot of food and water. Some day it will all run out but for now I’m good. I wish I still had gold bars.

  29. It’s historically been a bad omen for risk asset HODLers when The Housing Bubble Blog has over 200 posts per day.

    1. Today was one of those bad omen days for Mr Market.

      The Financial Times
      Coronavirus business update 30 days complimentary
      Markets Briefing Equities
      Oil and Asia stocks drop as US-China tension flares again
      Renewed friction between Washington and Beijing adds to coronavirus concerns
      Crude oil prices turn south again as traders worry about rapidly shrinking global storage capacity
      © REUTERS
      Hudson Lockett in Hong Kong 3 hours ago

      Asian stocks were broadly lower as tension flared between the US and China over the origin of the coronavirus pandemic, while oil prices tumbled as traders fretted over rapidly filling global storage capacity.

      Hong Kong’s benchmark Hang Seng index dropped 3.7 per cent on Monday morning, while South Korea’s Kospi index fell 1.7 per cent. Markets in Japan and mainland China were shut for holidays.

      Oil benchmarks also got off to a poor start for the week, hit by persisting worries about oversupply and inadequate storage. West Texas Intermediate, the US marker, was down 4.7 per cent at $18.85 a barrel in Asia trading while Brent crude, the international benchmark, dropped 1.2 per cent to $26.13.

      Futures markets tipped the S&P 500 to drop 0.7 per cent when trading begins on Wall Street later on Monday. The FTSE 100 was expected to fall by the same amount.

      The decline in oil prices, which followed their first weekly gain in a month last week, came as optimism buoyed by output cuts began to slip again.

      Last month US oil prices fell into negative territory for the first time as the cost of storage pushed producers to pay buyers to take product off their hands.

      Signs of risk aversion were still prevalent, with a $500m oil exchange traded fund in Hong Kong saying that its broker had blocked it from increasing its holdings of crude oil futures.

      Analysts at Citi warned on Monday that the “worst is likely yet to come, given signs of global storage reaching tank tops even as a demand recovery starts”.

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