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Some Of That Exuberance Is Starting To Look Irrational

A report from Forbes. “A startling number of homeowners struggling to pay their mortgages aren’t sure if they’ll face eviction soon. Some 16% of Americans who responded to the latest Census Bureau Household Pulse Survey—that’s a whopping 1.34 million people out of 8.42 million respondents—said ‘it’s somewhat likely’ they will have to leave their current house within two months due to foreclosure. The survey was taken Aug. 19 through 31.”

From Bloomberg. “After years of strong growth, rents in U.S. urban areas have decreased 2% since February, according to Zillow Group Inc. In New York, San Francisco, Seattle, and other high-cost cities, the decline has been almost twice that. (Other surveys show even steeper drops.) In few places has this shift been as dramatic as Capitol Hill, where developers have steadily converted the city’s former Auto Row along East Pike and Pine streets into gleaming new apartment blocks.”

“Some of that exuberance is starting to look irrational. The Solis, a new 45-unit apartment building in Seattle, has everything a young urban professional would have wanted six months ago. ‘It’s been really slow,’ says Brian Heather, chief executive officer of SolTerra Capital Inc., the company that developed the property. A building he once thought would fully lease in three months this spring is only about 60% full.”

From CBS Chicago in Illinois. “CBS2 Investigator Dorothy Tucker discovered that new rules designed to prevent homelessness are actually causing some landlords to lose their homes. Jillesa Willis showed off the blankets and clothes stored in her trunk in case the weather turns colder. They are in a makeshift closet in the car she and her daughter call home. But Willis does have a place of her own. In fact, she owns a two flat in Auburn Gresham.”

“She saved every penny for four years and bought it last November. Her plan was to keep the tenant on the first floor, who was paying $800 a month in rent. Willis would move to the second floor. But, her plan didn’t work out. Second-floor tenant Andre Richards, who works as a maintenance man, didn’t leave. With Richards refusing to leave or pay rent, Willis struggled to make the $1,300 mortgage. And she couldn’t afford to rent another place.”

“She’s an office worker, making $16 an hour. ‘I can’t afford to pay the mortgage and pay on my other bills,’ Willis said.”

“Recently, more than 100 small landlords jumped on a Zoom call venting their frustration with the moratoriums and invited CBS 2’s Tucker to listen in. Among those on the call was Katrina Bilella. While she worked out of state, she rented her Logan Square condo to Filemon Avila and Gabriella Almaraz. When the pandemic hit, both her tenants lost their jobs and stopped paying rent, nearly $2,000 a month. ‘By the end of the year, they will owe me about $20,000,’ Bilella estimated.”

“And then an ironic twist of fate, Bilella said she wrote to her tenants, ‘I just received news that I was laid off due to COVID-19,’ she said she wrote to her tenants. But they never replied. So instead of living in her own home, Bilella is now staying with family in New York. And her tenants? ‘I’m just paying for them to live in my unit,’ she said.”

From CBS Bay Area in California. “A program to assist small landlords financially impacted by the COVID-19 pandemic was approved Tuesday by San Mateo County supervisors. Supervisors voted unanimously to approve the Small Residential Rental Property Owner Assistance program, after allocating $2 million of federal funds towards its establishment on Aug. 4. Federal funding falls under the Coronavirus Aid, Relief and Economic Security (CARES) Act.”

“President of the Board Warren Slocum said in August that the board is trying to create a ‘win-win’ outcome. ‘We’re trying to create a situation that benefits small landlords as well as people and families so that they can stay in their homes and not end up homeless,’ Slocum said.”

The Commercial Observer on New York. “Mezzanine debt positions tied to four HFZ Capital Group condominium buildings in Manhattan are headed for a Uniform Commercial Code (UCC) foreclosure sale, according to a UCC foreclosure sale notice shared with to Commercial Observer and sources familiar with it. The junior mezzanine lender on the properties, CIM Group, triggered the sale, sources said. The four loans are cross-collateralized and have an aggregate balance of $89.5 million: 88 Lexington Avenue ($25.5 million), 90 Lexington Avenue ($15.6 million), 235 West 75th Street ( $38.5 million) and 301 West 53rd Street ($9.9 million).”

“A lawyer who does not represent any of the parties involved and spoke with Commercial Observer on the condition of anonymity today explained that junior mezzanine lenders run the risk of being wiped out by the senior mezzanine lender, and therefore move quickly to protect their interests and either take over the project themselves or sell their positions to somebody who would have interest in — and the ability to — take over a project.”

“‘The issue in the age of COVID is that people left the city for two weeks and, all of a sudden, it became five months,’ the lawyer said. ‘So people didn’t know if anybody was going to show up at a UCC auction or if any of the people who would ordinarily be willing to invest in a project would be willing to invest now. It puts pressure on the commercial reasonableness requirements to slow things down a little.'”

The Palm Beach Daily News in Florida. “A condo at The Bristol — the ultra-luxury tower completed last year on the West Palm Beach waterfront — has been sold by a Palm Beach owner who bought it new from the developer. Palm Beach real estate investor and insurance executive Peter J. Worth has resold his 18th-floor unit for $8.42 million, according to the deed recorded Monday. And Unit 1802 sold for $435,322 less than what Worth paid for the four-bedroom condo in November, courthouse records show.”

From Arlington Now. “Question: I’ve seen a lot more condos come to market and also some staying on market longer than before, is that part of a larger trend in the condo market? Answer: In July, I predicted there would be a surge in housing inventory that was held off the market this spring because of COVID. That has proven to be moderately correct for single-family housing and very accurate for condos. The market has had no trouble absorbing the extra single-family housing, albeit with less competition than before, but the condo market has not absorbed the extra inventory and has undergone a significant shift in the last two months.”

“In short, listing volume for Arlington condos reached historically high levels in July and August, absorption (demand) is down, and months of supply is the highest it’s been since the fall of 2017. It’s worth noting that while the overall Northern Virginia condo market is performing well, the Washington, D.C. condo market looks more like Arlington. In July and August, Months of Supply (2.73 and 2.80, respectively) reached the highest levels since October 2012 and were the first and third highest monthly listing volume over the last ten years. July (863 condo listings) is the first time in over a decade that more than 800 listings came to market.”

From Seattle Met in Washington. “There’s one sector of our local real estate market where home browsers can still avoid crushing competition: downtown condos. Though the pandemic has cleared out many offices, developers have pressed on with projects rising from the city’s core, adding to its condo supply at a time when few are willing to make the move downtown. The resulting inventory numbers are jarring: While it would take about one month to unload every single-family house on the market in Seattle at August’s rate of sales, accomplishing the same for every downtown and Belltown condo would require a whopping nine-month slog, per Northwest Multiple Listing Service’s August breakdown. In March, that number was under three.”

“‘I’ve gotten more inquiries about, ‘Can you sell my downtown Seattle condo for x?’ than we’ve gotten in a long time,’ says Lindsey Gudger, the owner of Georgetown-based Every Door Real Estate. ‘And unfortunately, the answer for a lot of those people is, based on market data, ‘No, we cannot.’”

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  2. ‘A program to assist small landlords financially impacted by the COVID-19 pandemic was approved Tuesday by San Mateo County supervisors. Supervisors voted unanimously to approve the Small Residential Rental Property Owner Assistance program, after allocating $2 million of federal funds’

    Years ago I arbitrarily picked San Mateo landlords to watch for rental watch. The poster who said “those loans will probably be OK.” You can eat yer crowz too, where ever you are.

    2. ‘A program to assist small landlords financially impacted by the COVID-19 pandemic was approved Tuesday by San Mateo County supervisors. Supervisors voted unanimously to approve the Small Residential Rental Property Owner Assistance program, after allocating $2 million of federal funds’

      Wow, Clownifornia pissing away borrowed money it doesn’t even have to backstop real estate speculators. Look at the lengths that federal, state and local politicians are going to in order to prevent price discovery. It appears there are no bounds.

        1. Because governments are made of people? And some of those people and their friends need that insurance? And it’s so easy to just slip such assistance in as needed?

  3. ‘The junior mezzanine lender on the properties, CIM Group, triggered the sale, sources said. The four loans are cross-collateralized and have an aggregate balance of $89.5 million: 88 Lexington Avenue ($25.5 million), 90 Lexington Avenue ($15.6 million), 235 West 75th Street ( $38.5 million) and 301 West 53rd Street ($9.9 million)’

    Are we there yet Larry?

  4. ‘So instead of living in her own home, Bilella is now staying with family in New York. And her tenants? ‘I’m just paying for them to live in my unit’

    But, interest rates?

  5. ‘rents in U.S. urban areas have decreased 2% since February, according to Zillow Group Inc. In New York, San Francisco, Seattle, and other high-cost cities, the decline has been almost twice that. (Other surveys show even steeper drops.) In few places has this shift been as dramatic as Capitol Hill…Some of that exuberance is starting to look irrational’

    It’s all fine and good for Bloomberg to make this observation in September, 2020. I said that in the fall of 2014. No crystal ball. I started watching the apartment market and pieced together lots of crazy talk, looked into the financing, etc, and concluded these clowns weren’t making money. That is they were buying and building for a greater fool. It was that easy. And this is a multi-trillion $ industry. A guy with a laptop in Arizona saw it coming but they couldn’t.

    1. Need to Know
      The Fed is ‘fighting the last battle,’ and here are the risks to its new strategy
      Last Updated: Sept. 16, 2020 at 8:40 a.m. ET
      First Published: Sept. 16, 2020 at 6:34 a.m. ET
      By Steve Goldstein

      Federal Reserve Chairman Jerome Powell is reflected in the sneeze guard set up between himself and members of the House Committee as he appears before the House Financial Services Committee hearing on Capitol Hill on June 30, 2020, in Washington, D.C. POOL/AFP via Getty Images

      The Federal Reserve is announcing its latest interest-rate decision on Wednesday, and expectations aren’t for a big shift at this meeting. More on that later.

      Still the big issue in the world of central banking is last month’s official pivot to average inflation targeting. That is, the Fed is saying inflation will be allowed to run over 2% if — as it has — price growth has been under that target for a significant period.

      Now the Fed didn’t really explain how it would implement this new strategy in practice. Tim Duy, the University of Oregon professor who writes the Fed Watch blog, says the benefit of that new shift comes when the economy is running faster than expected. “It’s particularly important in the context of a recovery that appears more rapid than anticipated. Along with the more rapid recovery is a faster pace of inflation,” he says.

      Already, the price level is looking to be returning to its pre-COVID trend. But the market, thanks to the Fed’s new guidance, isn’t shifting its expectations on interest rates.

      “Now we are thinking that there is nothing in the data to prompt a more hawkish reaction from the Fed,” says Duy. “The Fed is content to allow real interest rates to continue to drop and presumably content to allow them to fall even a notch further than the last cycle.”

      There is a risk in this strategy. “The Fed is committed to fighting the last battle, the long, slow recovery experienced in the wake of the Great Recession [2007-09 recession]. The Fed is absolutely unprepared for any outcomes on the right-hand side of the distribution. That opens up the risk that the Fed finds itself pivoting in 12 months or sooner,” says Duy.

      Another risk is the increased importance put on financial stability in the strategy change. Like the average inflation targeting, the Fed didn’t say how it would put that emphasis into practice. “You kind of have to wonder what happens if the Fed’s commitment to maintaining deeply negative interest rates keeps the heat up under risk assets as you might expect it to,” says Duy.
      …

          2. “…So … when will 0% interest mortgages appear?…”

            If mortgages go zero or even negative, Real Estate is unique in that it has *significant* holding costs.

            Property and local taxes, HOA, insurance, maintenance all require cash money upfront.

            Real wages are stagnant except for the top 10%, and as has been noted here on the HBB for a least a year, rents are going down.

            So where is the big win?

        3. It seems like lower and lower interest rates forever is the plan. But it doesn’t seem sustainable.

          It isn’t sustainable. But what comes then? I wish I knew!

      2. If the US dollar isn’t the reserve currency, then what will be?
        The Yuan? We can’t even trust China with a biochemistry lab, much less the global money system.
        The Euro? Germany can’t float Greece forever.
        Rubles?
        Bitcoin? There are countries that don’t even have electricity. Good luck with electronic money.
        PMs? Not practical.
        Tuna cans? Tide Pods? Actually those HAVE been used as currency.

        1. If the US dollar isn’t the reserve currency, then what will be?

          That depends upon who wins the war.

          PMs are entirely practical, for an honest people.

    3. The FED has effectively destroyed the standard of living for over 75% of the country. But now they have a plan to make that better: Inflation. Oh, wait….

    4. Dips buying really does work!

      The dead tree edition sez the stock rocket market rebound was “fueled by the Fed”…

      Why Did Stock Markets Rebound From Covid in Record Time? Here Are Five Reasons
      Forces behind fastest-ever swoon and recovery include economic hopes, tech dominance and a boom in risky trades
      By Sept. 15, 2020 11:11 am ET

      The Dow Jones Industrial Average’s wild round trip is nearly complete.

      The venerable stock index, despite a recent hiccup, has nearly recovered all the losses suffered during the coronavirus pandemic, an epic journey during one of the most catastrophic economic collapses in U.S. history.

      The Dow and the benchmark S&P500 plunged about 35% within six weeks this spring—the fastest-ever fall from record levels into a bear market—as the economy shut down and the virus spread across the country. Since then, U.S. stocks have been on a winning streak that is unprecedented in the modern era of financial markets.

      The Dow is near Feb. 12’s all-time high, while the S&P 500 recently staged its most robust five-month rally in more than 80 years.

      The S&P 500’s journey from record high to a bear market—defined as a drop of 20% or more—to a new record took just 126 trading days, the fastest-ever such climb. In previous downturns going back to 1928, it took an average of more than 1,500 sessions for the index to return to record levels, equivalent to about six years.
      To Read the Full Story Subscribe in The Wall Street Journal
      …

        1. The Financial Times
          Coronavirus business update 30 days complimentary
          Markets Briefing Equities
          Global equities slip after Fed comes up short on QE plans
          Markets under pressure after US central bank was ‘less dovish’ than some had forecast
          The gloomy start to European trading followed a drop for MSCI’s broad measure of stocks in the Asia-Pacific region
          © REUTERS
          Adam Samson in London and Hudson Lockett in Hong Kong
          54 minutes ago

          Global equity markets weakened after the Federal Reserve stopped short of promising changes to its massive bond-buying programme.

          European stocks kicked off Thursday in the red with the continent-wide Stoxx 600 down 0.8 per cent in early trading. Markets in London, Frankfurt and Paris were all down about 0.9 per cent.

          The falls come ahead of a policy decision by the Bank of England, scheduled for later on Thursday, which investors will be watching for further clues on UK monetary policy. Economists expect little change in interest rates or the BoE’s asset purchases, though the meeting comes amid rising anxiety about a potential no-deal Brexit.

          The gloomy start to European trading followed a 0.8 per cent drop for MSCI’s broad measure of stocks in the Asia-Pacific region. Futures markets tipped the US blue-chip S&P 500 index to fall 1.3 per cent when Wall Street opens later.

          Investors were left uneasy even after the Fed on Wednesday signalled it would hold rates at historic lows until at least the end of 2023. Several economists said they were surprised the central bank did not hint it would shift to buying more government bonds of a longer maturity to magnify the power of its quantitative easing scheme.

          “We interpret the lack of changes to the composition of Treasury purchases to mean that the FOMC does not currently plan to extend the average duration of its purchases, against our previous expectation that it would,” said Jan Hatzius, chief US economist at Goldman Sachs, referring to the policy-setting Federal Open Market Committee.

          “We now think that some additional trigger — such as a disorderly rise in yields at longer maturities or a deterioration of the economy — would likely be required,” he said.
          …

  7. ‘Unit 1802 sold for $435,322 less than what Worth paid for the four-bedroom condo in November’

    Nostradamus says, “somewhere, a UHS is telling people West Palm Beach is red-hotcakes!”

    ‘Can you sell my downtown Seattle condo for x?’ than we’ve gotten in a long time…And unfortunately, the answer for a lot of those people is, based on market data, ‘No, we cannot.’

    WA?

  9. “A startling number of homeowners struggling to pay their mortgages aren’t sure if they’ll face eviction soon.

    What’s so “startling” about being evicted if you can’t pay your mortgage? These FBs signed a contract – if they can’t hold up their end of the deal, Mr. Banker gets to take HIS house back. Buh-bye, FBs.

    1. I think that it was the number (16% of respondents) who are delinquent that they meant was “startling”. Of course, on this blog nothing is startling about that. Heck, I thought it would be higher.

      1. Realtors are liars.

        I would buy a house for $200,000 in Arapahoe or Jefferson County. They’re not worth more than $150,000 but I’d pay a little more. Since that’s unlikely to happen, I’ll continue renting for a third of the cost of buying, and I’ll take all my money with me when I leave.

  10. ‘It’s been really slow,’ says Brian Heather, chief executive officer of SolTerra Capital Inc., the company that developed the property. A building he once thought would fully lease in three months this spring is only about 60% full.”

    Sounds like a lot of flawed assumptions and failure to account for black swans went into your business model, Brian.

      1. Angry people pushing trash cans is a thing? I thought stamping their little feet was the approved response.

  11. “CBS2 Investigator Dorothy Tucker discovered that new rules designed to prevent homelessness are actually causing some landlords to lose their homes.

    Now that right there is an ace investigative reporter. Bet she had to peel back multiple layers of the onion and turn over every stone before she made that dramatic discovery. I expect to see banner headlines in every MSM newspaper tomorrow screaming out the shocking news that gub’mint meddling in the housing markets has unexpected consequences.

    C’mon, Ben & HBB regulars. Try to keep up with Dorthy.

    1. From the linked piece: “Sorry,” is the answer Willis heard from the sheriff’s office. “Silence” is what we got when we asked Gov. Pritzker’s office to comment on Willis’ plight.

      But ‘ya better pay ‘yo property taxes!

  12. At the end of June, 2020 the total debt outstanding in Canada (bottom line of the Statistics Canada credit market summary data table) was $9.319 trillion. At the end of June, 2019 the total debt outstanding was $8.447 trillion. In the 1 year period from the end of June, 2019 to the end of June, 2020 it increased by $872.4 billion. This is an increase of 10.3%.

    Update on the total (household, business, and all levels of government) debt numbers in Canada and the size of the Bank of Canada’s balance sheet 

    https://owecanada.blogspot.com/2020/09/update-on-total-household-business-and.html

  13. “President of the Board Warren Slocum said in August that the board is trying to create a ‘win-win’ outcome. ‘We’re trying to create a situation that benefits small landlords as well as people and families so that they can stay in their homes and not end up homeless,’ Slocum said.”

    F**k you, Warren. As a taxpayer and a renter, why should I be put on the hook to offset the impacts of gub’mint meddling in the housing market and the enabling of deadbeat renters? Maybe you Bozos should let market forces do their work for once and flush out the speculative excesses.

  14. Redding, CA Housing Prices Crater 11% YOY As Northern California Real Estate Market Gets Clobbered
    https://www.zillow.com/redding-ca-96002/home-values/

    *Select price from dropdown menu on first chart

    As a distinguished economist questioned, “Why buy a house when you can rent one for half the monthly cost… Buy it later after prices crater for 70% less.”

  15. Second-floor tenant Andre Richards, who works as a maintenance man, didn’t leave. With Richards refusing to leave or pay rent, Willis struggled to make the $1,300 mortgage. And she couldn’t afford to rent another place.”

    Gosh, sure seems like these wanna-be real estate moguls had some flawed assumptions underpinning their plans for generating effortless wealth. Tenants who refuse to leave or pay rent, with the blessing of the gub’mint? That seems irregular, but hey, welcome to ClownWorld.

  16. Seems like this is becoming a common tale.

    “Jillesa Willis showed off the blankets and clothes stored in her trunk in case the weather turns colder. They are in a makeshift closet in the car she and her daughter call home. But Willis does have a place of her own. In fact, she owns a two flat in Auburn Gresham.”

    “She saved every penny for four years and bought it last November. Her plan was to keep the tenant on the first floor, who was paying $800 a month in rent. Willis would move to the second floor. But, her plan didn’t work out. Second-floor tenant Andre Richards, who works as a maintenance man, didn’t leave. With Richards refusing to leave or pay rent, Willis struggled to make the $1,300 mortgage. And she couldn’t afford to rent another place.”

      1. To be fair, having her property rights arbitrarily suspended probably wasn’t on anyone’s radar.

        1. She probably figured the gubmint would side with wealthy homeowners and landlords over renters, the same way that it always has.

          But now that many more wealthy voters number among the renter class in the U.S., political support for landlords’ financial interests may not be quite as automatic anymore.

    2. Talk about solid lending — she makes $16 an hour and needs rental income to pay the mortgage.

      The good news is the REIC assures me that lending has been rock solid since 2009. No shenanigans this time!

    3. Low-income landlords turned out to the streets due to eviction moratoriums to protect low-income renters…

      I guess renters should jump for joy that government officials have noticed their plights and overridden centuries of contract law to protect them, but what a government engineered clusterfork!

    4. Seems like this is becoming a common tale.

      She saved every penny for four years and bought it last November.

      “My signing off on a home, let alone a two flat, that was something that was not easily [done] at my age,” Willis said proudly.

      I know we are tough crowd here, but i’m going to throw some sympathy her way, She’s not a hedge fund-backed corporation, nor a FB who went out and leveraged themselves into a dozen properties.

      Second-floor tenant Andre Richards, who works as a maintenance man, didn’t leave.

      Willis said Richards was reasonable at first. But she said he then told her, “I’m not moving out, not paying rent.”

      And, now he has a dog guarding the property.
      …
      Willis took Richards to eviction court and won. The order came down March 16.

      But five days later, the state shut down. Businesses closed and workers were furloughed. And then Gov. JB Pritzker issued a moratorium on evictions – stalling 1,700 evictions by Cook County Sheriff’s police.

      Getting a guard dog? Her “tennant” knows what he is doing, and decided he would freeload well before the covid situation hit. He’s going to exploit things as far as he can.

      And this is where additional conflict is brewing. Besides individuals vs the govt, individuals vs bit companies, we have individuals who try and ‘play by the rules’ vs ‘individuals who will game the system’ It’s not that far removed from the conflict we are having with the ‘homeless by choice’. The ants are damn tired of the grasshoppers leaching off of them, stealing and more.

      The backlash is brewing. The question is when and how will it be expressed.

      1. Agreed. Lots of people getting paid to do nothing except sit at the beach all day fishing, surfing and getting drunk here. I have to work, pay all my bills and get none of that sweet sugar from Uncle Sam. Hell, I have a tax refund due to me that hasnt come and from what I’ve read many others are in the same boat. Its like government took the last place guy in the marathon and put a gold medal around his neck and made the top 3 finishers pay for that medal. I’m over it.

        1. Agreed. Lots of people getting paid to do nothing except sit at the beach all day fishing, surfing and getting drunk here. I have to work, pay all my bills and get none of that sweet sugar from Uncle Sam.

          Yeah, it’s getting pretty effing annoying, if you ask me.

      2. I have a little more sympathy for this FB also, but if your a landlord you need 6 months of expenses in case you get the renter from hell.
        Looks like she got in by the skin of her teeth.
        Hard lesson to learn the hard way for her.

        1. Doesn’t sound like there’s a moratorium on getting a judgement against the SOB. Maybe they have a nice vehicle.

      4. +1 Spiffy. Willis sounds like someone who was trying to improve their position by buying a rental property. But who first was partly screwed because housing prices are so bloated. And then got completely screwed when the gov’t decided to suspend contract law.

        1. Exactly. I grew up in a tiny town a few hours outside of Detroit, and there were a share of people like her – trying to play by the rules and build some security in a place you wouldn’t exactly call rife with economic opportunity.

          And those as the people who will get hurt the worst by these decrees (and Wall Street, and the feds, and..)

      1. Good article

        Not really, since the premise is this:

        Governments around the world have increased spending to support their economies hit hard by the coronavirus pandemic. Some have to borrow more to do so — which is a “sensible economic strategy” when confronted with the current crisis and uncertainties

        1. As far as I can tell for most of the world the coronavirus didnt do nearly as much damage to the economy as did the idiotic government policies driven by fake science and media hype. I have to don a mask when I enter and exit my local gym, but can work out without one – apparently that magic ~8 feet around the entrance is where the air is thick with beer flu and you could DIE, lol!!?!

          Great man on the street video where interviewees are asked to guess what the covid statistics are and then are told the facts:

          https://www.youtube.com/watch?v=w8Dvuh2iwWE

          2. Well, it is true that everyone who enters the building leaves behind a personal virus load near the entrance, before going where they go inside.

            But your point is taken about the arbitrary nature of mask rules. My outdoor community tennis court requires us to wear masks when passing through the gates to the recplex and onto the court, after which we can take them off. With no other humans within 100 yards besides my tennis partners, I wonder who that protects?

    2. ‘…“inflation will not be tolerated” by aging societies,…’

      I realize that this refers to people who vote and drive election outcomes.

      However central bankers who decide on what level of inflation to tolerate are generally unelected. I am not sure how aging societies will be able to politically influence the inflation level?

  18. “We felt an obligation to tell people our neighborhood is really messed up,” says Dunn, whose security service recently went through six fire extinguishers one night after demonstrators set fires in the street. “Everyone knows we’re not raising rents this year.”

    What a great was to rate apartments!

    Close to good schools and shopping this Seattle neighborhood rates only 3 fire extinguishers.

    1. The amount of DJT signs I see around rural Colorado makes me smile. Coming back to Denver makes me depressed, the Front Range and its politics are like a tumor in the body of the state.

        1. Scroll down 4 videos on that twitter page to…

          “Joe Biden has just ONE thing to say and it ain’t good. Listen to this”

          🙂

      2. I’m about halfway around the country now. Started in San Francisco and eating seafood in Boston tonight. My wife noted that outside the big cities you see at least 10x the Trump signs as Biden signs. There’s just no enthusiasm out there in D land…even in the bluest states.

        1. My wife noted that outside the big cities you see at least 10x the Trump signs as Biden signs

          I didn’t see a single Biden sign on our trip from Seattle to TN/KY. Lots of Trump support out there though.

        2. You don’t need to be for trump, or against him – you just need open eyes to see there is deeper meaning there and a big divide happening in this country. Trump could die next week of a sudden heart attack and it wouldn’t do anything to change that fact. We’re all looking at some very turbulent times in the years ahead and I expect major clashes with ‘the establishment’ along economic, class and (somewhat) generational lines.

        3. “There’s just no enthusiasm out there in D land…even in the bluest states.”

          Not unless there’s something to burn to the ground, steal, vandalize or a good polar bear hunting opportunity.

      3. I’ve see at least a dozen Trump flags in rural Maryland. Not some little yard sign — flag-pole sized flags. And some say “Trump 2020” on them, so they didn’t recycle it from 2016. Does Biden even make flags?

        1. I saw a couple months ago a hand painted sign by someones house that said vote “Biden” – biden was in quotes! Not sure if it was tongue in cheek or what. Thats the only sign I’ve seen for biden and I just drove 3K miles around the mainland.

          Last weekend on an empty lot by the highway I saw a yuge trump flag in the middle of a fenced area designed to protect the flag and lined with smaller american flags. Just down the highway was a small sign, like 8.5×11 or so that said STD 2020 and on closer examination I saw that STD stands for Stop The Donald. I kid you not.

    2. What a great was to rate apartments!

      Close to good schools and shopping this Seattle neighborhood rates only 3 fire extinguishers.

      I literally LOL’d at this!

  19. Following its latest FOMC meeting, the Keynesian fraudsters at the Fed justified QE-to-Infinity by stating that “over coming months the Federal Reserve will increase its holdings of Treasury securities and agency mortgage-backed securities at least at the current pace to sustain smooth market functioning and help foster accommodative financial conditions, thereby supporting the flow of credit to households and businesses.”So ‘Murican households already staggering under their current debt loads can pile on even more debt? Meanwhile, the Fed’s promise to print up more inflation means households are going to be putting even more essentials on credit cards, making the eventual financial reckoning day that much more cataclysmic.

    Thomas Jefferson and Andrew Jackson are spinning over in their graves, shouting “We told you so!”

  20. “She’s an office worker, making $16 an hour. ‘I can’t afford to pay the mortgage and pay on my other bills,’ Willis said.”

    Shoeshine girl poster child for the end of untold riches to anyone with a side gig as a landlord?

    1. A few generations ago she (or her spouse) would have earned a living wage, owned a modest house with a reasonable monthly payment and maybe even had a small pension upon retirement. All that is gone for her and many others. Small wonder they resort to desperate moves like becoming a heavily indebted landlord. And of course, she no doubt saw others doing it: look at my new SUV! (paid with a cash out refi, of course).

      The message is loud and clear: working is for suckers.

      1. Of course, past generations avoided debt like the plague. Rather than buy stuff on credit, people saved, or at worse they used lay-away. I’ll bet that if you asked a 20 something was lay-away is, you’d get a blank look from most. My mom had a Sears card, but never carried a balance on it.

          1. As recently as the early 90s, it was very difficult to get a credit card.

            This. I was well into my second enlistment (of my Air Force career) before I could finally get a credit card. But ~10 years later, I was getting pre-approved credit card offers in the mail.

            As for layaway (which I remember my parents using), it has actually made a comeback in recent years.

          2. Very true. I had to be added to my father’s card in the early 90s as I got turned down every time I applied (no bad marks on my credit history, just not much history at all).

            What I shoud have done was go back to college for a semester and accept every card offer sent my way!

      2. Small wonder they resort to desperate moves like becoming a heavily indebted landlord.

        It looks like this particular example is more modest – the rental is also her only home. For years, it wasn’t that uncommon a way (having a tenant) for people of modest means in modest areas to acquire a house.

        I certainly saw it in my tiny blue collar town growing up. I would see 2 story houses here and there with outside staircases as the floors were split into separate residences, each floor maybe 600 to 1000 sq ft at most – nothing fancy. People were just getting by, not trying to make a killing.

      3. Here is an example of house 1/2 rented out a couple blocks from the elementary school I went to:

        https://imgur.com/a/rrPj8XE

        Per the census stats, average per capita income there has risen greatly and is now at $35k/yr. Clearly they are all just rolling in it.

          1. Per Zillow.. 1740 Sq ft ( ~870 sq ft per floor ) – tax appraisal for $48,300

            Totally typical for a small rust-belt town that’s been left out of the economic booms of the 2000s.

            In a place like that (my home town) there isn’t a surplus of great tenants, so they take what they can get to get by.

        2. house 1/2 rented out

          One of the many annoying aspects of this insane real estate bubble is the boarding house listings that have proliferated on Craigslist. Speculators grossly overpaid for properties, then attempted to rent rooms for $800 per in order to not only recapture their grotesque outlay, but to try to profit. Not many takers, though. I look forward to these clowns taking an asspounding.

    1. The Harris Biden depression, if allowed to happen, will end with tens of millions starving and homeless, and the U.S. starting a decade long trillion dollar war in the Middle East.

      2. Kamala Harris, who is pushing to defund police and during her disastrous 2019 campaign promised to ban assault rifles within the first hundred days of her administration, is now guarded by cops armed with assault rifles. Security for me, but not for thee. I sincerely hope her and her Vice President, Joe Biden, think long and hard before they try to implement their globalist puppet masters’ prime directive to disarm the kulaks. In the present political and security environment, that would be an epic mistake.

        https://www.dailymail.co.uk/news/article-8731701/Kamala-Harris-seen-Miami-protected-agent-carrying-assault-rifle-vows-ban.html

        1. OK, but… Didn’t everyone expect the Obama administration to enact draconian gun control laws? He even had a majority in both houses for the first two years. But nothing happened.

          Then again, did he ever actually say (on the campaign trail) that he planned to push Congress for gun control? Or did people simply assume he would?

          2. OK, but… Didn’t everyone expect the Obama administration to enact draconian gun control laws?

            I did.

            He even had a majority in both houses for the first two years. But nothing happened.

            Yeah, I laughed at my lefty friends who complained later about R obstruction when it was already demonstrated that it didn’t matter.

            Then again, did he ever actually say (on the campaign trail) that he planned to push Congress for gun control? Or did people simply assume he would?

            I don’t know. I assumed he would once there was a Clinton in his administration. It’s not like Feinstein and friends had gone away.

    2. When do these evictions that are talked about happening actually begin to happen??

      I do not think either administration is going to let it happen. I expect program after program of taxpayer money to cover landlords and renters, and prevent the tsunami from happening. Just look at what they’re doing already.

    3. When do these evictions that are talked about happening actually begin to happen??

      Right?

      I was looking forward to a nuisance neighbor getting the boot, but he’s still there. Because the NV moratorium apparently also covers evictions for cause, even if the renter still has an income.

  24. What is it about posting falling prices on the internet that enrages you?

    Ocean Isle Beach, NC Housing Prices Crater 16% YOY As Coastal And Retirement Property Market Turns Toxic On Collapsing Demand

    https://www.zillow.com/ocean-isle-beach-nc/home-values/

    *Select price from dropdown menu on first chart

    As a nationally recognized broker advised, “Get out and get out at any price. You’ll thank me later.”

  27. Federal Reserve expects interest rates to stay near zero through 2023
    By Irina Ivanova
    Updated on: September 16, 2020 / 4:05 PM / MoneyWatch

    The Federal Reserve expects to keep interest rates near zero until at least 2023 to help reinvigorate the coronavirus-stricken economy, the central bank announced Wednesday in opting to leave rates unchanged.

    The widely expected decision to stand pat on interest rates is in line with the Fed’s recent policy shift. The central bank has said it plans to keep rates near zero for the foreseeable future as it tries to boost inflation above 2% in a bid to prop up the labor market. In addition, it will no longer preemptively raise interest rates when the economy approaches full employment, but will instead wait for evidence of price increases.

    The Fed’s benchmark rate target,which affects borrowing costs for homebuyers, credit card users and businesses, currently ranges between zero and 0.25%.

    In considering future rate changes, the Fed said it will “take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.”
    …

    1. “In considering future rate changes, the Fed said it will “take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.”

      No longer interested in corporate and government debt levels?

      1. No longer interested in corporate and government debt levels?

        Maybe they’re hoping if they ignore the debt, it will go away?

  28. It’s 12:34AM PDT and Dow futures are down 405 points.

    Told myself to scrub off some gains 2 weeks ago and same today. Did I? Newp. Should be an exciting Thursday!

      1. What we find is most people are gambling. Even Apartment 401, who claimed he was out of the markets, admitted he had gotten back in. The FED knows what they’re doing – they know how to entice gamblers. They’ve turned the entire system into one big gambling orgy.

        2. -“idiots”
          -“had gotten back in”

          I’m 70% cash/physical. The remaining 30% is split evenly between stock/bond fund holdings.

          Within that 30%, I have funds that I continue to DCA into as a “don’t fight the Fed” play. That doesn’t mean they, too, don’t need timely scrubbins to add to the cash pile.

  29. Trump fuels spread of altered Biden video, tweeting it twice

    By BEATRICE DUPUY

    The video, which appears to show Biden playing a controversial song by the rap group N.W.A. during a campaign trip to Florida, was labeled as manipulated media by Twitter, but it continued to circulate widely.

    In the original video, Biden pulls out his cellphone and plays “Despacito,” a song by Puerto Rican singer-songwriter Luis Fonsi, who introduced him at a Hispanic Heritage Month event Tuesday in Kissimmee, Florida. In the altered video, N.W.A.’s “F—- Tha Police” plays.

    https://apnews.com/b83c6017619eba4f92a3d033e50782f8

    The United Spot
    @TheUnitedSpot1
    ·
    Sep 15
    Joe Biden has just ONE thing to say and it ain’t good. Listen to this

    https://twitter.com/theunitedspot1/status/1306048702872612866

      1. It’s an altered video, funnier than hell but altered.

        Slow Joe was trying to look hip playing some song by a Puerto Rican singer at a Hispanic Heritage Month event in Florida this week which looked bad enough. But then some joker dubbed in those nasty rap lyrics and put it up on Twitter.

        Of course Trump retweets it and the MSM like a bunch of tattletale school children go nuts…

        Oooooh look what Donald did, I’m telling.

    1. B…b…but what happened to UHS claiming low inventory was the only thing keeping them from selling shacks like hotcakes?

      1. Um, no thanks. The “huge price reductions” will be a lot more huge once these overpriced shacks go into foreclosure. In addition, I’d be leery about buying anything built after the late 1990s, given the corner cutting and shoddy workmanship that went into so many of these bubble-era shacks.

        1. When I was out there a decade ago, I noted there was block after block with no driveways. I know that’s not everywhere. but still.

          1. 2 or 3 bedrooms with 1 or 2 bathrooms. I looked at renting in that area back in 2004 but ended up in a 2/2 in Kensington.

          2. I remember when non beachfront homes in La Jolla were in the low 6 figure price range. I knew a guy whose parents had such a house in the early 80’s. They would routinely get burgled, even though the house was wired.

          3. They would routinely get burgled, even though the house was wired.

            I have a friend in Culver City who spends most of his time working on location, often out of the country. He came home one time and there was nothing left in his house. They showed up with a moving van and took everything, including his clothing.

          4. He came home one time and there was nothing left in his house.

            I’ve often wondered why burglars would do that. Most of the stuff people have in their homes is worthless. Emptying a house quickly is a lot of work and I suppose that the risk of being caught (say a neighbor noticing) is non trivial.

            It seems that getting in, grabbing the valuable stuff, and getting out fast makes more sense, but what do I know?

    1. Ultra trendy name, check.
      High valuation, check.
      Hyped IPO, check.
      Shoeshine investors who don’t know crap, check.

      We’re partying like it’s 1999.
      i’m gonna buy low in 2022.

  34. Will Mr. Market freak out when word gets around that it will take at least five years for the real economy to recover?

    1. News
      The global economic recovery will take at least five years, World Bank’s Reinhart says
      ‘Everything depends’ on when a vaccine gets approved and how long it takes to be given to people
      By Bérengère Sim
      September 17, 2020 11:34 am

      The global economic recovery from the recession created by the Covid-19 pandemic will probably take at least five years, according to the chief economist of the World Bank.

      “We have seen [economic] collapses that are very much outside of the norm,” Carmen Reinhart said, speaking at the virtual Foro Tendencias 2021, hosted by Spanish daily El Pais, on 17 September.

      “Naturally, there will be rebounds but the real recovery – how long it will take for the average person to recover the income they had before the crisis, the GDP per capita – this will take at least five years.”
      …

    2. It took longer than 2 to five years after the 1929 Stock Market Crash to recover. The Stock market stayed down until the early fifties.

      But with all the gov. interference, along with good laws that were repealed, the Feds etc. , how can one person predict it?

      1. Thomas Sowell has probably spent more of his own money and time analyzing the causes of, and the reasons for the slow recovery from, the Great Depression, than just about anyone else. He’s worth researching, if you can find the time.

          1. You’ll find a lot, but he’s a prolific writer so you’ll have to focus on the Great Depression. Personally, i make it a point to try to never miss one of his videos. He’s a national treasure and he’ll be gone soon. Started out as a hard core Marxist too.

        2. Pretty much everything by sowell is genius, the work of a lifelong focus on mental discipline. Basic Economics is my favorite, but Discrimination and Disparities is amazing and White Liberals and Black Rednecks is a red pill buffet.

  35. Just listening to fake news in California, it so insane.
    A Newscaster was saying I’m essence that Trump wants a October released vaccine for his own political reasons.

    It’s not like Trump approves a vaccine, it’s the FDA. And why wouldn’t a President want a so called vaccine cure, the sooner the better. More lives saved the sooner a approved vaccine comes out.

    I don’t hear Trump saying approve a unsafe vaccine.

    It’s just every move Trump makes is spinned into bad motive, which is a projection from the other sides motive.
    It’s disgusting that a unfortunate virus could be such a political game.
    And how would a newscaster know what Trump’s motives are . Trump’s just reporting that a vaccine might be released in Oct.

    3. The libs are saying that the FDA will approve a vaccine because Trump stacked the FDA with his cronies. If the FDA were really stacked with Trump cronies, then why did they revoke their approval of HCQ?

      1. True believers will be swallow any lie, no matter how outlandish. It’s those pesky swing voters that need to be convinced, and the lies they get to hear require more finesse.

  36. TEACHER TELLS STUDENT SHE DOESN’T HAVE THE RIGHT TO AN OPINION BECAUSE SHE’S “WHITE” AND “BLONDE”

    Paul Joseph Watson | Infowars.com – SEPTEMBER 17, 2020

    A video clip shows a grandmother confronting a teacher over the phone about how she told a student she didn’t have a right to an opinion because she was “white” and “blonde.”

    After being told there is an audio recording of the exchange, the teacher responds, “Well I can’t remember, maybe.”

    The teacher then accuses the granddaughter Kelsey of having white privilege and saying she didn’t “live through” what the other girl involved in the discussion (who was evidently black) had experienced.

    https://www.infowars.com/teacher-tells-student-she-doesnt-have-the-right-to-an-opinion-because-shes-white-and-blonde/

    2. It subsequently emerged that Kelsey had refused to honor Black Lives Matter and the teacher had immediately took the black student’s side because “Kelsey isn’t in a position to know how black girls feel.”

      This was in the UK, where there never was slavery, where the cops don’t shoot black people (because they are unarmed) and which bends over backwards to accommodate “people of color”. Why is there any BLM presence there?

      Homeschooling is allowed in the UK and is on the rise. About 60,000 children are currently home schooled in the UK.

        1. Yeah, that.

          But my point stands. Blacks aren’t being shot by police in the UK, so why is there BLM over there? Other than to destabilize society?

          What next? BLM in South Africa?

      2. where the cops don’t shoot black people (because they are unarmed)

        If you google “uk police shootings” you would find that they indeed happen. Not as often as in the US, but then UK cops don’t have to assume that everyone they deal with is armed with a gun.

        1. They’re rare because most cops in the UK are unarmed. The only armed cops I saw last time were at Heathrow and around Buckingham Palace. My guess is that they’re looking out for terrorists.

          Anyway, I took a look online. So far this year, there have 4 police shooting deaths in the UK. 3 of the dead had Islamic names.

  37. Well, it’s child abuse if you ask me, it’s also racism to say something like that to a child. NUTS

    1. it’s child abuse if you ask me

      You are correct. Manipulating a child to have scars where there were none. Sociopathic.

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