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Some People Think There Could Be Huge Losses If There Is A Decline In House Prices

A report from the Financial Post in Canada. “Bill Morneau had been finance minister for only 36 days when he first attempted to do something about runaway housing prices and mortgage debt. He announced in December 2015 that the minimum downpayment for an insured mortgage would in two months rise to 10 per cent from five per cent on the portion of the loan that exceeds $500,000.”

“It was a risky move for Morneau, a first-time member of Parliament from Toronto, since it would irritate constituents who had become wealthier by owning real estate from the beginning of the housing boom. But a response was overdue. Household debt had exploded to record levels and Canada had become vulnerable to a financial crisis.”

“History often rhymes, but unlike the rest of Mark Twain’s famous quote, it does sometimes repeat. Trudeau’s government presents itself as less cynical than its predecessor, but don’t believe it. Confronted with an acute outbreak of housing mania this spring, Trudeau and his current finance minister, Chrystia Freeland, turned to the Harper playbook. Trudeau and Freeland could have used last month’s budget to finally overhaul a deeply flawed housing policy. Instead, with the possibility of an election this year, they did the minimum.”

“Back in the summer of 2015, mortgage credit was growing at an annual rate of about six per cent, compared with five per cent or so a year earlier. The housing crisis then was really a story about massive bubbles in Vancouver and Toronto. That argued against an aggressive federal response. There’s no such thing as a national housing market, goes the cliché. It would be folly, not to mention unfair, to punish buyers in places such as Moncton, N.B., and Ottawa for the sins of the Big Smoke and Lotusland, both of which had emerged as global destinations for international high-flyers in the aftermath of the Great Recession.”

“The mania has now spread. In March, Canada Mortgage and Housing Corp. flagged Moncton and Ottawa as being highly vulnerable to a collapse, along with Hamilton, Toronto and Halifax. Victoria, Vancouver, Edmonton, Calgary and Montreal were described as ‘moderate’ risks to financial stability. ‘There is now evidence of overheating at the national level,’ CMHC said in its latest quarterly Housing Market Assessment.”

“The central bank’s job is to keep the Consumer Price Index advancing at a rate of about two per cent a year. That task now appears to require extremely low interest rates. The central bank needs the ability to deflate asset-price bubbles that are the side-effects of aggressive monetary policy. Some might say that’s too much power for an unelected body. But remember that the Bank of Canada was handed a long leash to manage inflation because it had become clear that politicians couldn’t be trusted to make the hard choices required to cool economic growth.”

“Canada’s real-estate bubble has now been inflating for more than a decade. That’s enough evidence to show that politicians can’t be trusted to manage housing policy, either.”

The Globe and Mail. “Canada’s real estate market has skyrocketed over the past year, setting off a vigorous discourse over the dangers of rapidly rising prices and steeper barriers to homeownership. And yet, inflation numbers offer a subdued – even drab – version of events. As bidding wars and six-figure price increases become the norm, it’s tough to find much of an impact on Statistics Canada’s go-to measure of inflation, the consumer price index.”

“‘CPI does not include the purchase of a property, because in this case, we don’t consider a house a consumer good,’ said Heidi Ertl, director of the consumer-prices division at Statscan. ‘We consider it an asset.'”

“A second issue, which the inclusion of resale data does not address, is the impact that interest-rate changes have on the Mortgage Interest Cost Index. When interest rates drop, the index declines, as homeowners take on new mortgages or refinance existing mortgages at lower rates. Over the past year, the MICI declined 6.3 per cent, owing to Bank of Canada rate cuts and its continuing efforts to hold down interest rates through its quantitative-easing program.”

“At the same time, however, the central bank’s ultraeasy monetary policy is throwing jet fuel on the housing market. This creates the uncomfortable impression that the bank’s main gauge of inflation and guide to monetary policy is unresponsive to the segment of the economy that the bank is stimulating the most.”

From Nine News. “Australian tenants struggling to make rent were the hidden losers of last night’s Federal Budget, as the Morrison government’s cash splash prioritised home ownership over affordable housing. Despite extending three key initiatives to encourage first home buyers to enter the property market, there was little cash spent on easing conditions for renters or providing more affordable housing.”

“Eliza Owen, head of research at property data firm CoreLogic, said much of the Budget’s home ownership policies were designed to encourage more buyers while protecting current prices for owners.
‘In contrast to the Labor party platform of reducing housing demand through the 2016 and 2018 elections (via reducing or removing incentives for housing investors), the Federal Government have utilised a different approach to boosting the rate of home ownership,’ Ms Owen said. ‘They focus on increasing accessibility of mortgages, rather than risking any downward pressure on residential property prices.'”

From Stuff New Zealand. “Amid all the noisy talk of constraints on LVRs, DTIs and interest-only loans, the Reserve Bank has quietly floated the possibility of wielding a fourth tool: treating home loans as higher risk and so increasing the capital requirements for banks to lend against residential property.”

“The Reserve Bank is on the verge of implementing new rules requiring banks to hold more capital to make the banking system safer, after drawn-out consultation and Covid delays. The four large banks must increase their total capital ratios from 10.5 per cent to 18 per cent, smaller banks must increase their capital to 16 per cent.”

“It’s an expensive obligation for the banks that has prompted grumbling from their Australian parent companies – but even before the new requirements come into force in July, the Reserve Bank has now disclosed it may go still further.”

“Finance Minister Grant Robertson had asked the Reserve Bank to consider the tools it can use to support more sustainable house process. So, in its financial stability report this month, it discusses the existing tool of loan-to-value ratios; it discusses the Bank’s desired tool of debt-to-income ratios with a question mark over whether they can just target investors as Robertson wishes, or whether they would also restrain first homebuyers from over-extending themselves. It considers (and cast doubts on) the efficacy of restrictions on interest-only lending.”

“But it also discusses a fourth financial policy instrument that will have banks and borrowers alike shifting nervously in their seats. It’s a proposal to get out an old tool that’s been rusting in the back of the kit: changes to capital requirements on a sector-by-sector basis.”

“So, as well as the blanket increase to capital requirements coming into force next month, banks would also be required to increase their capital ratios still further when lending on residential property. The Reserve Bank presents this as a response to the higher risk if there is a downturn and property prices drop, leaving both homebuyers and banks exposed. But critics are dubious.”

“Professor David Tripe, who specialises in banking at Massey University, said New Zealand banks’ capital holdings were already higher than was reasonably necessary for the risk in the housing market.”

“‘Some people think this residential mortgage lending they’re doing is unsustainably rising and there could be huge losses if there is a decline in house prices,’ he said. ‘I just don’t think that decline is plausible, when we still have such a shortage of housing. You can certainly increase the capital holdings to penalise banks and discourage housing lending further. But what that means is that those in a less advantaged financial position will find it even more of a challenge to buy into the housing market.'”

“On Tuesday night, New Zealand’s biggest bank sounded a note of caution. ANZ spokesperson Stefan Herrick said there had already been substantive change in both regulatory and fiscal policy around housing recently. ‘Initial signs are that this is having an impact, so should be given time to bed down.'”

“He indicated the bank would prefer the effects of the previous government and Reserve Bank housing, tax and lending policy changes be measured, before embarking on further changes. ‘Anecdotally we’re also hearing that while demand is still strong for houses, the rate of price increases seems to have slowed,’ Herrick said. ‘All government and Reserve Bank initiatives should be considered carefully – remembering the dangers of unintended consequences. Ultimately, the housing crisis will be solved by more houses being built.'”

From Bloomberg. “If the Federal Reserve is truly as outcome-based as it claims to be under its new policy framework, it should start winding down its purchases of mortgage-backed securities. The fact that it’s not even thinking about doing so is revealing about just how hesitant it is to make even the slightest tweaks to monetary policy at this point in the economic recovery.”

“Lost in the shuffle last week amid all the Fedspeak about inflation and Friday’s shocking jobs report were comments from Boston Fed President Eric Rosengren. ‘My own personal view is that the mortgage market probably doesn’t need as much support now. And in fact, one of my financial stability concerns would be if the housing market gets too overheated,’ he said. ‘I do think that as we think about tapering one of the things that we are going to have to think about is at what speed we taper the Treasuries versus the mortgage-backed securities.'”

“While Rosengren also added to the central bank consensus that it remains premature to focus on tapering, a view only reinforced by the U.S. labor market adding surprisingly few workers last month, he raises an interesting question: Why exactly is the Fed still increasing its holdings of mortgage-backed securities by $40 billion a month when Chair Jerome Powell himself has said that ‘the housing sector has more than fully recovered from the downturn’ and that the rapid price appreciation means ‘it just is going to be that much harder for people to get that first house.’ Couldn’t the Fed be using its bond-buying bazooka more effectively?”

“It certainly seems that way, especially when gauging sentiment within the agency mortgage-bond market itself. ‘Outside of the central bank today, there was little impetus to buy,’ my Bloomberg News colleague Christopher Maloney noted. Banks ‘mostly joined other investors on the sidelines, waiting for wider spreads.’ The option-adjusted spread on the Bloomberg Barclays U.S. MBS index fell to just 0.07% at the end of April, the narrowest since 2010. It’s no secret why: The Fed has gobbled up almost $2 trillion of MBS since March 2020, which is more than its total aggregate purchases in any of its previous quantitative easing episodes.”

“As I mentioned on Twitter during Powell’s press conference in April, the Fed doesn’t have a satisfactory answer for why it’s throwing billions of dollars at mortgage bonds at this point. His answer boiled down to three things: First, that the MBS market was in chaos during the onset of the pandemic; second, that it bought them after the 2008 financial crisis so it should do so again; and third, MBS purchases are now inextricably linked to tapering in general, so it’s stuck buying them until it reaches the nebulous ‘substantial further progress’ mark.”

“Here’s Powell’s quote in full, which doesn’t even fully capture his struggle to answer: ‘Yeah. I mean, we started buying MBS because the mortgage-backed security market was really experiencing severe dysfunction, and we’ve sort of articulated, you know, what our exit path is from that. It’s not meant to provide direct assistance to the housing market. That was never the intent. It was really just to keep that as, it’s a very close relation to the Treasury market, and a very important market on its own. And so, that’s why we bought as we did during the global financial crisis. We bought MBS, too. Again, not intention to send help to the housing market, which was really not a problem this time at all. So, and, you know, it’s a situation where we will taper asset purchases when the time comes to do that, and those purchases will come to zero over time. And that time is not yet.'”

“As long as U.S. housing prices increase year-over-year by more than 10%, as they have for each of the past three months, Fed officials should continue to face questions about the central bank’s presence in the mortgage market. After all, no one is asking for them to do this. Would-be MBS buyers are sitting out, waiting for spreads to widen, suggesting the MBS market would function just fine without central-bank meddling. Look no further than corporate bonds, where investors are all too eager to buy debt from companies with deeply speculative-grade ratings, for proof that there’s no shortage of demand for debt with a bit of extra yield. That includes appetite from banks that are flush with extra reserves specifically because of the Fed’s balance-sheet expansion.”

“In the end, the Fed seems content to be like the unwanted guest at a house party who just won’t leave. No one is going to kick the central bankers out, but it might be nice if they gave some indication that they’re exiting soon.”

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This Post Has 118 Comments

  1. ‘Powell’s quote in full, which doesn’t even fully capture his struggle to answer: ‘Yeah. I mean, we started buying MBS because the mortgage-backed security market was really experiencing severe dysfunction, and we’ve sort of articulated, you know, what our exit path is from that. It’s not meant to provide direct assistance to the housing market. That was never the intent. It was really just to keep that as, it’s a very close relation to the Treasury market, and a very important market on its own. And so, that’s why we bought as we did during the global financial crisis. We bought MBS, too. Again, not intention to send help to the housing market, which was really not a problem this time at all. So, and, you know, it’s a situation where we will taper asset purchases when the time comes to do that, and those purchases will come to zero over time. And that time is not yet’

    Central bankers are dangerous idiots.

    2. So, and, you know, it’s a situation where we will taper asset purchases when the time comes to do that, and those purchases will come to zero over time.

      The former Iraqi Information Minister, Baghdad Bob, would blush with shame and mortification if asked to put across such whoppers. Every single one of these gold collar criminals at the Fed needs to be held accountable when the implosion of their Everything Bubble takes down the financial system.

    3. This just in from the NAR: 182 of 183 U.S. metros had a higher first quarter home price in 2021 than in 2020, with 89% reporting a 10% or more increase.

      Stimulus works!

  2. CPI up through the roof. While employment sucked on Friday. Biden the new Jimmy Carter without the personality

        1. Will Republican “leaders” start ACTING like Republicans and push back on state-sponsored parasitism and the globalists-collectivists deliberate destruction of the productive economy?

          Now NINE Republican states are refusing Biden’s $300 a week unemployment benefit as North Dakota, Iowa, Missouri and Tennessee join Arkansas, Montana, Mississippi, South Carolina and Alabama

          https://www.dailymail.co.uk/news/article-9569891/Now-NINE-states-refusing-Bidens-300-week-unemployment-benefit.html

        1. My wife asked me about panic buying of gasoline currently reported in the news. I couldn’t explain it to her. You can pile up toilet paper in your spare bedroom, but where do you hoard gasoline?

          1. You can’t fix stoopid.

            ‘Do not fill plastic bags with gasoline,’ safety commission warns drivers amid fuel shortage
            National & World News
            by: Nexstar Media Wire
            Posted: May 12, 2021 / 01:10 PM CDT
            Updated: May 12, 2021 / 01:10 PM CDT
            Drivers fill their tanks at the Speedway in East Ridge, Tenn., on Tuesday, May 11, 2021. The concern over the ransomware attack on the Colonial Pipeline has sparked lines at gas stations and empty pumps in the Chattanooga Area. (Matt Hamilton /Chattanooga Times Free Press via AP)

            (NEXSTAR) – As fuel stations in the East run out of gas amid panic-buying after cyberattackers hit the Colonial Pipeline on Friday, the U.S. Consumer Product Safety Commission is reminding drivers just how dangerous improperly stored gas can be.

            “Do not fill plastic bags with gasoline,” the safety commission said in a tweet Wednesday. The reminder comes as images show desperate drivers lining up at the pumps and some hoarding containers full of gas.
            …

          2. Watching videos of imbeciles putting gasoline into plastic bags, Darwin is snickering from the sidelines.

          3. Bear, tell the missus that you’d be surprised how many people (ditzbrain wives, mostly) are in constant danger of running out of gas. Rather than run the fuel tank from 1/8 gallon to the fuel light coming on like normal, they’re all getting gas at the same time.

      3. I just passed by a busy local intersection with gas stations on each of three corners. One station was totally out of gas, one had ~1/3 working pumps left, and the last had busy busy and lines were quickly forming. It’s panic buying on top of shortages. Luckily, I filled up my tank on Saturday, so I have about 350 miles. If I don’t go on a long drive, that’s enough to last me two weeks at least.

        1. It’s nice to have a range that you can fall back on. I can easily walk to the store. Question is if the stores can get deliveries.

  3. ‘Look no further than corporate bonds, where investors are all too eager to buy debt from companies with deeply speculative-grade ratings, for proof that there’s no shortage of demand for debt with a bit of extra yield. That includes appetite from banks that are flush with extra reserves specifically because of the Fed’s balance-sheet expansion’

    See, globalism is central banking. What we wold call the deep state turned to none other than Greenspan and Volcker to set it up after WW2. And there’s no more obvious example of globalism than Bloomberg. Sure, there’s jet fuel all over the place. Imaginary coins that don’t exist! What happened to my self driving taxis got dammit?

    Why do they do this? It’s all they got. Without endless money hosing, they’d all be dangling from the necks under street lamps.

    1. “…to buy debt from companies with deeply speculative-grade ratings, for proof that there’s no shortage of demand for debt with a bit of extra yield.”

      One lesson learned from the protracted and bloated Quantitative Easing experiment is that keeping interest rates on lockdown to the zero bound greatly increases the level of investment in fundamentally worthless assets and projects, and makes the related prices rocket up to the moon.

  4. ‘In contrast to the Labor party platform of reducing housing demand through the 2016 and 2018 elections (via reducing or removing incentives for housing investors), the Federal Government have utilised a different approach to boosting the rate of home ownership,’ Ms Owen said. ‘They focus on increasing accessibility of mortgages, rather than risking any downward pressure on residential property prices’

    Eliza as it a bit wrong. They use guberment subsidies to foist prices on the backs of greater fools. The current Australian guberment, once elected set out to reflate the bubble. They didn’t even try to hide it. Of course, people down there are trained like circus bears to jump into such situations.

  6. ‘the possibility of wielding a fourth tool: treating home loans as higher risk and so increasing the capital requirements for banks to lend against residential property’

    Behold, the mother of all scams. Fractional reserve banking. That’s right folks, from time to time it’s admitted they aren’t even lending real money. They got a peso or 5 (somebody deposited, maybe even that is from a central bank), they can lend 100.

  8. we in SC have a full blown Gasoline panic going……The News Media is trying to not mention it much, that maybe one out of 12 stations has it ,and they limit you to $10 per purchase …..Today’s cars and normal sized trucks are so efficient, that a fill-up (I filled mine up on Sunday,before this all hit) will last a week or more …..

        1. That corrupt senile pedophile isn’t king of sh$t. He can’t even finish his applesauce. We have to listen to the media tell us stuff that just isn’t true. Sound lending? 30% increases or more in some areas? I’ll say this: there is rampant mortgage and appraisal fraud going on right now. How do I know? Already happened.

          March 26, 2020

          “As America heads into a deep recession, the $11 trillion residential-mortgage market is in crisis. Investors who buy home loans packaged into bonds are dumping even those with federal backing because of panic that millions might not make their payments. Yet one risky sector had started to show cracks long before the coronavirus pandemic sparked the worst financial meltdown in 12 years: the federal government’s largest affordable-housing program, whose lenient terms are geared toward marginal borrowers.”

          “As real estate prices soared in recent years, working-class adults everywhere have increasingly relied on mortgages backed by the Federal Housing Administration — and U.S. taxpayers. Since 2007, the FHA’s portfolio has tripled in value to more than $1.2 trillion, almost 11% of the market. While private lenders make these loans, they are packaged into Ginnie Mae bonds, common in mutual funds and pensions.”

          “Before Covid-19 started roiling China, a November FHA report found that 27% of borrowers last year spent more than half their incomes on debt, a level it describes as ‘unprecedented.’ The share of FHA loans souring in their first six months has doubled over the last three years to almost 1%.”

          “Not long ago, Alex Castillo drove his shiny black Infiniti SUV through an office park north of the San Antonio airport, along a busy seven-mile stretch of highway that loan officers call ‘Mortgage Row’ because of its abundance of small independent mortgage companies that dominate FHA lending. Castillo, who has the words ‘The Dream Starts Here’ stitched into his jacket, works for Pennsylvania-based American Residential Lending. Oddly, amid the pandemic, his business is booming. His customers locked in FHA mortgages after interest rates plunged this month — adding to federally backed mortgage debt.”

          “‘If the government tells me you’re good enough to get a loan, I have to trust and believe in the government,’ Castillo said. ‘Then we just hope and pray that the client doesn’t get foreclosed on.’”

          “In downtown San Antonio, scores of investors stood on a parched lawn beside the city’s historic granite-and-red-sandstone courthouse. It was the first Tuesday of February, the day of the foreclosure auction. Matt Badders, a San Antonio lawyer who represents lenders, auctioned off two houses. The failed mortgages remind him of the run-up to the financial crisis 12 years ago, when lending to customers with spotty credit nearly brought down the world’s financial system. ‘We’re almost back to 2007, when mortgage originators are waking people up on park benches, saying sign here,’ Badders said.”

          “At the auction, the crowd bid on 338 homes, a third with FHA mortgages, according to Roddy’s Foreclosure Listing Service. One house had dual master bedrooms, a game room and granite kitchen counters. It sold for $202,000 — $52,000 less than the homeowner borrowed only two years ago. The taxpayer-backed FHA insurance fund will take a loss.”

          “Dave Stevens, FHA commissioner under President Barack Obama and former chief executive officer of the Mortgage Bankers Association, said a recession will expose hidden risks in home lending. ‘This should be an alarm bell to policymakers,’ Stevens said. ‘Sometimes you get blinded by a good economy and suddenly look at it and see a bubble of defaults coming.’”

          “The federal government has decided it doesn’t want to pursue — and has asked a judge to dismiss — a lawsuit against Utah-based Academy Mortgage Corp. The judge refused. The suit claims the company’s staff would repeatedly feed information into an automated federal underwriting system, manipulating it until the computer gave the green light. ‘Decline is a curse word,’ Plaintiff Gwen Thrower, a former underwriter, quoted a manager as saying. ‘We don’t use it.’”

          http://housingbubble.blog/?p=3070

          3. I’m calling a market top. Post peak, in fact.
            House sales around here in Citrus Heights, CA have stalled AND are actually getting price reductions.
            Too little too late though to stop the damn “developers” from paving over every square inch of the Sacramento Valley.
            I remember not too long ago how the vaunted San Francisco snobs insulted the area with comments like: “Cowtown. Sacratomato.” etc
            Funny that NOW they are all flocking here for elbow room. . . and discovering . . it ain’t so bad after all. Why, kinda . . nice, actually!

            Old axiom of “It’s different when I’m involved”

          5. Analyst David Hunter, a contrarian with 40 years experience, called for the following tops for equities:
            DOW: 38,000
            S&P: 4,700
            NASDAQ: 17,000
            with all fuq breaking loose in the 3rd quarter resulting in a 60-80% drop. Whoh nellie.

            I’m more inclined to believe Hunter. The current downturns don’t feel like the Big One, not yet. We still have a Summer of Luv coming, as the vaccines climb upward and deaths and cases finally stay down, and people spend their pent-up cash. Come Labor Day or a little after, it’s back to brass tacks. No more goodies.
            Back to the office, back to school, back to work, pay your rent, pay your mortgage. Then we’ll see. I don’t expect an 80% drop tho, more like 50%.

          6. I think we’re getting close to the end of the crypto bubble. Once the hyperinflating Dogecoin came on the scene, it essentially poked a hole in the entire crypto narrative, erasing the idea that they’re anything but a speculative mania. SHIBA INU coin started soaring, etc. What a joke this entire space is.

          7. We are definitely close to peak, if not just tipping over it. In my nabe, something like 3/4 of the houses for sale are pending. But the remaining houses are quickie-dickie flips listed at laughable prices. They aren’t fooling anyone, so they sit.

    3. we in SC have a full blown Gasoline panic going

      Have the shelves at the grocery stores been picked clean?

      1. If the trucks stop rolling due to a lack of gasoline, things could get Barnum & Bailey real quick.

    4. Go buy an electric vehicle. Our betters have told us that electricity magically comes out of the wall.

  9. Neocon stooge and globalist water carrier Liz Cheney bilged by her Republican colleagues. O happy day! This hope this is just the first ouster of the GOPe globalist Quislings from the Republican Party, which for decades has pandered to Wall Street and the corporate cartels while ignoring and disregarding the Republican base. Buh-bye Lizzie! CNN’s caterwauling tells all!

  10. Buh-bye and good riddance, RINO Liz Cheney!

    Na na na na, hey hey, goodbye
    Na na na na, na na na na, hey hey, goodbye

    1. The Republicans have to be careful here. Wyoming is full of political hopefuls vying for that seat in the next primaries. If they split the vote between them, Liz could still win the primary. The GOP needs to pick only one challenger for her. Then, like Hillary, Liz can sit in her living room and vow all the revenge she wants.

  11. “The sudden price appreciation is impacting affordability, especially among first-time home buyers,” he added. “With low inventory already impacting the market, added skyrocketing costs have left many families facing the reality of being priced out entirely.” Even though interest rates remain lower than in most of the first quarter of 2020, the average national monthly mortgage payment rose to $1,067 from $995 a year ago.

    Even the most expensive markets continued to experience double-digit price growth. San Jose saw annual appreciation of 11.1 percent, San Francisco’s median price was up 21.8 percent, and Urban Honolulu prices gained 19.2 percent.

    “These higher home prices underscore the importance of stepping up housing supply,” Yun said. “An increase of inventory – either by new construction or by converting abandoned and unused retails or hotels – would combat the affordability problem.”

      1. well most couples without kids, can downsize into 3 rooms with everything on the hard drive, and a big screen on the wall, how much room do we actually need in 2021 vs 2001?

  12. Supporters of Israel and the Palestinians carrying out their own little proxy war in the heart of our nation’s financial capital – just another blessing of the globalists’ open borders, unrestricted immigration, and multiculturalism.

    Ugly scenes in heart of Manhattan as Israeli and Palestinian supporters fight in middle of street: Protests break out across US as Middle East violence intensifies

    https://www.dailymail.co.uk/news/article-9569037/Israeli-Palestinian-supporters-clash-NYC-Protests-place-US.html

  13. I found where some of the stimulus money went.

    The Southern Poverty Law Center ran a nice propaganda piece on our local ABC news affiliate (which means every ABC local news station across the nation) about the dangers of all the white supremacist hate groups (Trump voters) across the country. The dude playing the part of the converted white supremacist on the video is laughable.

    EXCLUSIVE: Part 1: ‘Hate in the Homeland’ growing, crimes not reported to FBI

    This story is a part of Hearst Television’s series “Hate in the Homeland.” Our National Investigative Unit is uncovering the battle against hateful acts in America. Stay with this station for more stories on the fight against Hate in the Homeland.

    In 2020, the Southern Poverty Law Center (SPLC) said it tracked 866 hate groups.

    “It is a lot. And it’s scary. Yeah, it’s a frightening number,” said Susan Corke, director of SPLC’s Intelligence Project.

    “I feel like our country is at a reckoning.”

    The 19-year-old from Michigan, who now lives in a state in the South, is also heard on tape being recruited to join The Base, a white nationalist organization designated as a hate group by the SPLC.

    “They tried to get therapists to talk to me. They tried to suspend me. They tried to do whatever they could to stop, you know, me, de-radicalize me and everything,” Webb recounts on the podcast. “And it just didn’t work and just made me more secure in what I was doing. And it worked. I mean, I got a group of people around and got people to wake up.”

    https://www.wpbf.com/article/hate-in-the-homeland-growing-crimes-not-reported-to-fbi/36396389

    2. “It is a lot. And it’s scary. Yeah, it’s a frightening number,” said Susan Corke, director of SPLC’s Intelligence Project.

      The founder of the SPLC, Morris Dees, was finally forced out after decades of sexually harassing interns and junior employees. Hyping various “extremist” threats is a great fundraising tactic for these shakedown artists.

      2. “shakedown artists”

        The SPLC should rename itself the Defamation League. That’s who they are, and that’s what they do.

        Washington Post on speed dial anytime this cartel LARPing as a “civil rights organization” publishes yet another smear.

  14. In our turbulent and ever-changing world, one constant remains: realtors are liars.

    1. Moving to Florida?

      “In December, Mr. Stallone snapped up a $35.3 million waterfront compound in Florida’s upmarket Palm Beach, a home with oversized windows, vaulted ceilings, a gym, a temperature-controlled wine room and more than 250-feet of sandy water frontage.”

      1. How much did he pay for it? If he paid $10M 25 years ago, then he will still come out ahead.

        1. Here is what Mansion Global says. Note that the MG article is from January 26:

          “Big-screen action hero Sylvester “Sly” Stallone is primed and ready to part with his longtime Los Angeles home, a sprawling estate expected to be listed this week for $110 million.

          Mr. Stallone, 74, and his wife, Jennifer Flavin, have owned the eight-bedroom home through a trust since 1998, property records show, but it’s unclear how much they paid for the property.”

          So, he’s chopping from $110 million to $85 million. He could probably chop it to $50M and still come out ahead.

  16. House GOP Ousts Trump Critic Liz Cheney From Top Post

    Republican lawmakers used a voice vote to remove Cheney, R-Wyo., from the party’s No. 3 House position

    Updated 53 mins ago

    House Republicans ousted Rep. Liz Cheney from her post as the chamber’s No. 3 GOP leader on Wednesday, punishing her after she repeatedly rebuked former President Donald Trump for his false claims of election fraud and his role in fomenting the Jan. 6 Capitol attack.

    Meeting behind closed doors for less than 20 minutes, GOP lawmakers used a voice vote to remove Cheney, R-Wyo., from the party’s No. 3 House position, a jarring turnabout to what’s been her fast-rising career within the party.

    Cheney has refused to stop repudiating Trump and defiantly signaled after the meeting that she intended to use her overthrow to try pointing the party away from the former president.

    https://www.nbcnewyork.com/news/politics/house-gop-set-to-oust-trump-critic-liz-cheney-from-top-post/3050636/

      1. So you cheerlead on the way up, acting like you’re some sort of clairvoyant while chastising everybody who points out what a massive bubble it is, yet ignore it when the floor completely drops out? Typical troll shill.

          1. What is it about falling housing prices that makes you so happy?

            La Mesa, CA Housing Prices Crater 11% As Construction Cost Slips Under $50 Per Square Foot

    3. Hah…lumber futures are bouncing around like the Dogecoin, though on a slightly slower time scale. Is it almost time again to buy the dip?

      1. Lumber is big and difficult to store. That’s why a bubble like this will ultimately end in a massive crash – the inventory has nowhere to go. Kind of like when all of those pencil-necked speculators in crude got burned and had to pay somebody to take it off their hands because they had no intention of actually taking delivery.

        1. Watch: Fight at Gas Station as Fuel Crisis Deepens
          Woman tries to cut line, spits on driver she hit, witness says

          By Dan Lyman Wednesday, May 12, 2021

          Two people were arrested after a fight at a gas station near Raleigh, North Carolina, as a fuel shortage affecting the eastern United States worsens.

          Video footage of the altercation at a Marathon station in Knightdale was shared to social media by a man identified as ‘Rashaad’ by local media.

          “She tried to cut the line for gas. They both got arrested. Who do y’all think is wrong,” Rashaad wrote in a video caption on Instagram.

          https://www.instagram.com/p/COvyhm7nu8N/?utm_source=ig_web_copy_link

      2. North Carolina relatives tell me that almost all gas stations are sold out
        Drove from SC to NC today. Found gas in Dillon SC. Line not too long. Most gas stations all out of Gas in both NC and SAC

          1. things are so tight that cousins Gomer & Goober say they had to use some of Papa’s recipe to fuel-up Sheriff Taylor’s squad car.

    2. YOU need to buy an electric vehicle and charge it with the magical electricity that comes out of the sky.

      The sky is always there. Every time you look up, it’s still there. Muh Feelings (and NPR and the New York Times) told me there will always be a Sky Wizard giving us free electricity.

      Buying gasoline is for the “little people.”

      1. From the Colorado Sun:

        Colorado drivers could use a “coach” to get them to buy more EVs

        These things won’t sell themselves, according to a new series of public-private partnerships that say retiring gas vehicles to stop climate change can’t be left to the free market.

        “Can’t be left to the free market” …

        Did I forget to mention that they want to close the coal fired power plants?

        What could possibly go wrong?

  19. “It was really just to keep that as, it’s a very close relation to the Treasury market, and a very important market on its own. And so, that’s why we bought as we did during the global financial crisis. We bought MBS, too. Again, not intention to send help to the housing market, which was really not a problem this time at all.”

    What is the advantage to having the Fed override the private sector bid in the MBS market? Doesn’t this have the unintended consequence of pushing up housing prices to unaffordable levels, and providing institutional investors in U.S residential housing with subsidized returns, at the expense of American families’ ability to afford basic housing?

    I’m struggling to understand the advantages of the Fed’s housing market wealth redistribution scheme.

    1. We personally know a number of families who have wracked up over $1 million in home equity gains just by HODLing their houses since the 2007-2009 financial crisis. While I’m happy for their good fortune to be on the right side of the Fed’s wealth redistribution scheme, I have to question whether this reflects good public policy. The folks sitting on large home equity gains weren’t exactly hurting to begin with. And on the other side of the wealth divide is an ever growing homeless population, plus Millennials trying to qualify for massive mortgages to buy starter homes at some of the highest prices in recorded history.

      Of course the Fed’s official rhetoric acknowledges no role in driving housing prices back up to unaffordable heights…

        1. Agreed.

          But interestingly, many folks we know are also selling and moving to other states.

          And in at least a couple of instances, they are selling and just hanging out at relatives’ places, waiting for prices to come back to earth, at which point they plan to buy again. It takes quite a bit of confidence that a crash is in the works to do this.

          And for reference, I met a guy back in 2006 who had friends who worked in McKenzie’s Manhattan office, who reportedly were doing the same sort of thing — selling their high-priced NYC digs and renting until after the crash. Meanwhile, there were also stories going around about cab drivers and hair dressers who were big-time real estate investors on the side.

          1. selling and just hanging out

            One of my husband’s close childhood friends had his college roommate do that last time around. He and the college roommate are no longer friends.

            Unless they’re helping with the bills, it’s selfish.

    1. Market Insider
      Inflation spooks stocks and raises fear the Fed is wrong that the price spike is temporary
      Published Wed, May 12 202111:58 AM EDT
      Updated 3 Hours Ago
      Patti Domm

      Key Points
      — Markets were braced for a hot consumer inflation report, but nowhere near the 4.2% headline increase reported for April.
      — The report raised concerns that the Fed’s view that higher inflation will be transitory is wrong, even though Fed Vice Chairman Richard Clarida reiterated that view after the report.
      — Stocks sold off, yields jumped and the futures market signaled that some investors believe the Fed could hike interest rates earlier than expected.
      …

    2. Does the Fed risk losing credibility with excessive reassurances that inflation will remain low without a need to raise interest rates?

      1. The Financial Times
        Markets Briefing Asia-Pacific equities
        Global stocks drop as inflation fears rattle investors
        Asia-Pacific shares hit as sharp rise in prices stokes concerns over economic recovery
        Japan’s Topix index lost 0.6% in early trading on Thursday after US consumer prices rose at the fastest rate since 2008
        © AFP via Getty Images
        Thomas Hale in Hong Kong
        55 minutes ago

        Asia-Pacific equities followed Wall Street lower after data showed US consumer prices rose at their fastest pace since 2008, prompting fears over higher inflation as global economies recover from Covid-19.

        Japan’s Topix index lost 0.6 per cent in early trading on Thursday while China’s CSI 300 index of Shanghai- and Shenzhen-listed stocks dropped 0.9 per cent. South Korea’s Kospi was down 0.3 per cent and Australia’s S&P/ASX 200 weakened 0.4 per cent. Hong Kong’s Hang Seng shed 0.8 per cent.

        The losses came after official data in the US showed inflation rose 4.2 per cent year on year in April. The reading spooked markets, with the S&P 500 closing down 2.2 per cent, the Wall Street benchmark’s worst one-day performance since February.
        …
        The sharp market reaction reflected increasing concern over the prospect of higher inflation as the US and other big economies recover from the coronavirus pandemic. A senior Federal Reserve official this week played down inflation risks as a “transitory surge”.

        “The Fed’s insistence that inflation is only transitory does have an audience,” said Tai Hui, chief Asia market strategist at JPMorgan Asset Management. “But if inflation data does not calm in the next few months, the challenge to its credibility could be disruptive”.
        …

  23. Well done young lady.

    81 Comments

    Dohnia Parfitt
    1 day ago
    It’s really good to see one of the young ones who gets it and steps outside of the mind control. Great Poem, thank you.

    PARRHESIA – Now more important than ever.

    7,636 views•
    May 1, 2021

    Kayla Henry
    164 subscribers

    I wrote this poem to encourage independent thinking. Mainstream media pushes fear and avoids delving deeper into major issues. We deserve the truth, and we owe it to ourselves to take the time to find it. Censorship and propaganda are driving us further away from Freedom, Free Speech, Peace, Independence..

    https://youtu.be/I0wDdMeGBfM

      1. Too big to bail?

        You just can’t not love it that China is more interested in supporting free market capitalism than the U.S. Federal Reserve is.

        The Ticking Debt Bomb in China’s $18.1 Trillion Bond Market
        Contributors: Rebecca Choong Wilkins and Molly Dai
        Updated on January 25, 2021 1:02 AM EST
        What You Need To Know

        Investors in the world’s second largest bond market are facing a reality check.

        While defaults were once considered a rare occurrence in China’s bond market — with many borrowers having relied on financial support or a bailout in times of trouble — the past three years combined saw a record number of delinquencies. Defaults eased off for much of 2020 as policymakers sought to limit economic damage by the coronavirus outbreak, before picking up again at the end of the year. The risks continue in 2021, according to analysts.

        After years of debt-fueled spending, Chinese companies are under increasing pressure. They are trying to cope with unsustainable levels of debt and a crackdown on unregulated lending, also known as shadow banking — all against a backdrop of substantially slower economic growth compared with earlier decades. Beijing has sought to establish a more market-led approach to risk that allows competition to weed out weaker borrowers and so-called “zombie” firms.

        With Beijing pulling back some of its supportive measures introduced to offset the impact of the pandemic, signs of credit stress are returning. A series of failures among state-linked companies sent shockwaves through the market, throwing doubt on the credit risks of a group of borrowers historically considered to enjoy the implicit guarantee of the state or local governments.
        …

  25. The Financial Times
    Opinion Cryptocurrencies
    Dogecoin gives away the crypto game
    Success of the ‘joke’ currency shows that we shouldn’t take cryptocurrencies too seriously
    Jemima Kelly
    The dogecoin website on a smartphone. The digital token has hugely outperformed bitcoin since its creation in December 2013
    Jemima Kelly yesterday
    …
    Dogecoin gives the lie to the idea that we should take bitcoin and other cryptocurrencies terribly seriously. While crypto evangelists might want everyone to buy into the notion that bitcoin is going to take over from the dollar one day, and that we all need to hold some of it in order to protect ourselves from the evil central bankers who want to inflate away the value of our money, the reality is that their arguments are largely just a self-interested attempt to boost the price of cryptocurrencies.

    Much like a pyramid scheme, those who got in early on bitcoin have a huge financial incentive to draw in others by any means necessary. But while getting rich is clearly the main motivating factor — and some people have indeed managed to become incredibly rich from crypto — it is not the only one.

    Buying into crypto should be considered akin to gambling and, like gambling, people get into it not just because they might make money, but also because it’s entertaining. It’s no coincidence that cryptocurrencies and “meme-stocks” have surged in a year in which much of the world has been locked up indoors. It is the result of what Bloomberg columnist Matt Levine has called the “boredom markets hypothesis”.

    Crypto trading is often more accessible than gambling, particularly in places where betting is heavily regulated, such as in the US. It allows buyers to feel like they’re in some kind of tribe. And while the “LOL” factor might not be considered a traditional metric for working out the value of an asset, that doesn’t mean it shouldn’t be: clearly, the extent to which it is fun to buy into something has an impact on how much it is bought, and nowhere can that be seen more clearly than in dogecoin.

    The joke-coin makes a mockery of the idea that crypto investing should be considered a serious pursuit. Its very existence undermines the notion that bitcoin derives value from its scarcity. While bitcoin’s total supply will eventually be capped at 21m, as written into its original source code, there is no limit to the number of copycat cryptocurrencies that compete with it — there are now almost 10,000, and dogecoin itself has no hard supply cap.

    Dogecoin’s success makes just as much sense as the rest of the crypto market — people buy into these coins because doing so is exciting, it gives them something to do and discuss with their friends, and of course because it can allow them to make a quick buck. But perhaps it can also allow us to stop taking the crypto project quite so seriously. While we’re at it, we might do the same with the stock market.

    1. I’m waiting to see one of these billionaire oligarch’s graft tied directly to subverting the election.

          1. Too bad the courts

            First it has to become illegal. Some states are already doing that.

    1. The Financial Times
      Opinion Markets Insight
      Investors brace for test of nerves as inflation worries mount
      Markets face uncertainty as economic growth adds to expectations of interest rate rises
      Katie Martin
      Technology stocks have been under pressure after sparkling over the past 12 months
      Katie Martin 4 hours ago

      For too long, more than a year, managing money has been relatively plain sailing, with stocks rising higher. This is instilling an anxious sense that something has to go wrong, and putting pressure on some of the stock markets’ frothier elements.

      Earlier this month, Janet Yellen was responsible for flicking away a little of that froth. At an event hosted by the Atlantic magazine, the former Federal Reserve chair, now US Treasury Secretary, uttered words that struck fear in the hearts of some market participants: “It may be that interest rates will have to rise somewhat to make sure our economy doesn’t overheat.”

      It is almost comical that this should cause any market reaction at all. The Fed slashed rates to zero and turned on the stimulus hose in the teeth of the coronavirus crisis last year. Now, happily, vaccination rates in the US are high and infection rates are falling. Business is getting back to normal, quickly. Quickly enough, in fact, to cause bottlenecks and supply problems in everything from lumber to labour.

      It does not take a rocket scientist to see how this might pan out. Making predictions is foolish, but I am prepared to stick my neck out here: the next move in US interest rates will be higher, not lower.

      And yet: bring out the smelling salts. After Yellen’s comments, some of the technology stocks that have sparkled over the past 12 months swooned, and the Nasdaq Composite ended the day down by nearly 2 per cent. Yellen herself quickly clarified her remarks. She was not “predicting or recommending” a rise in rates, which is no longer in her domain anyway.

      Some analysts described the Treasury secretary’s words as a volatility-stoking mis-step. Cooler heads saw it as a statement of the obvious. The market reaction just underscores how thin-skinned some investors have become and how carefully monetary and fiscal policymakers need to choose their words.
      …

  29. Does anyone have an idea of how large the carbon footprint of cryptocurrency mining is?

    Will it be necessary to destroy the planet in order to keep growing the cryptobubble?

    1. A couple years ago, someone calculated that mining used as much electricity as all of Ireland. By now it’s probably a lot more.

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