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Great, I Have To Give Away Six Months Free, Well Then Why Am I Buying This Now?

A report from Spectrum News on California. “Saving and budgeting might be the best approach for aspiring home owners in LA County, where the average house costs over $700,000. Richard Green, director and chair of the USC Lusk Center for Real Estate, said prices are skyrocketing without signs of slowing down. ‘House prices have gone up by an insane amount, almost 16% nationally,’ he said. ‘Here on the west coast, even more than that.'”

“‘When you are a new buyer entering the market, you want to put your foot in the door,’ said realtor Kevin Stewart. ‘You want to negotiate, and it’s not working like that. When you find a property that you love, you have to step up to the plate and just give them that godfather offer in order to make the deal happen.'”

From Lookout Santa Cruz in California. “Housing prices in Santa Cruz paused their historic upward surge in June, with the median sale price of single-family homes across the county dropping 9.6 percent from unprecedented highs reached in May, according to Aculist. The median price countywide for single-family homes dropped to $1,175 million in June, down from $1.3 million in May.”

“Aculist noted that a recent expansion of the data pool it uses to calculate its monthly real estate report may have had a small downward effect on the median numbers, but not enough to account for the nearly 10-point drop countywide. The slackening of prices is rare good news for beleaguered local home shoppers, possibly indicating that the price run-up may have peaked.”

From Cap Radio in California. “Ravi Kahlon and her husband Raja Jagadeesan owned six rental homes — including some duplexes in Sacramento and the Bay Area — before the pandemic. After the economy shut down, four of their nine tenants stopped paying rent entirely due to job losses or other hardships brought on by the COVID-19 crisis. ‘Every month we were taking money out of our personal savings,’ said Jagadeesen, who also works as a physician. ‘Mortgages never changed. Our monthly expenses didn’t go away. Our utility payments didn’t change. Our monthly expenses went up.'”

“For Kahlon and Jagadeesen, the resulting loss of revenue put pressure on their ability to stay afloat as landlords. They estimated they’ve lost $28,000 from two properties in Vallejo alone. Their rental business was becoming unsustainable. The loss of rental income at several properties during the pandemic proved too much for Kahlon and her husband Raja Jagadeesen. They’ve ended up selling half their properties. ‘You know, we’re not getting any revenue from property X. But we are bleeding money every month,’ Jagadeesen explained.”

From Bloomberg on New York. “Condo sales are surging in New York City. But fewer of those buyers are tapping a once-popular investment strategy: leasing out their units for income. The idea fell out of favour as rents dropped during the pandemic amid a mounting pile of apartment vacancies. Of all New York City condo units purchased in 2020, just 2.7 per cent were listed for rent within six months of closing, according to data compiled by StreetEasy. In 2017, the share was a record 11 per cent.”

“‘It’s a strategy that has a lot of risk right now,’ said Nancy Wu, an economist at StreetEasy. ‘Renting it out is very notably not-profitable because of how much rents have been dropping.'”

“In June, despite a 38 per cent drop from the previous month, there were 11,853 available apartments in Manhattan alone. ‘No investor wants to go up against a landlord who has a hundred or 200 vacancies,’ said Stephen Kliegerman, president of Brown Harris Stevens Development Marketing, who oversees sales in new condo buildings. ‘They think, ‘Great, I have to give away six months free, well then why am I buying this now?'”

From Forbes. “Many landlords aren’t happy. Many have lost money, and some say they’re on the point of bankruptcy due to unpaid mortgages. Large-scale property owners were largely able to ‘weather the storm because they have a cushion to cover monthly expenses like taxes, heating oil, electric, employee wages,’ according to Michelle Quinn, a partner at New York City real estate law firm Gallet Dreyer & Berkey. But smaller-scale landlords — even those who ‘have five, six, seven units where they live in one and rent out the others,’ said Quinn, simply don’t have those resources. ‘Really the landlords are the party taking the brunt of the effect of the pandemic,’ she argued.”

“Quinn said while rental moratoriums may have been necessary to stem COVID, little thought was paid to what landlords should do, with banks still expecting mortgage payments. Many owners, she said, were in fact left in the lurch after missing months of payments. ‘I have two cases in high-end coop and condo where the tenants just left,’ Quinn said. ‘They’re giving tenants a break, but not giving landlords a break.'”

The Pahrump Valley Times in Nevada. “‘Housing prices are starting to exceed what many citizens of this community can afford, and any sign of slowing down aside from a seasonal adjustment is likely attributed to not as many buyers being able to afford a home at these prices or having the cash to come out of pocket due to lagging appraisals,’ Las Vegas Realtor President Aldo Martinez said. ‘We warned this would happen the closer we get to a median price of $400,000.'”

“LVR reported that at the end of June, 2,454 single-family homes listed for sale didn’t have any offer on them. This number was down by 51.7% over the same time in 2020, but Martinez noted that the number of homes listed without offers increased for the fourth straight month in June. For buyers, Martinez says to be patient and persistent, as many homes with multiple offers usually end up back on the market and ‘are then awarded to the next buyer in line.'”

The Center Square. “According to the latest monthly figures from the Colorado Association of Realtors, housing inventory increased by 24% in June. On the Front Range, Boulder realtor Kelly Moye said the fast-paced market has caused some buyers to exit because of burnout. In turn, homes that haven’t sold are seeing slight price reductions. ‘This is typical for July and into August so the real question of whether the market is changing will be determined in the fall,’ Moye said. ‘Buyers have an opportunity now to take advantage of the price reductions and slower pace and still get into the market.'”

From DS News. “While loss-mitigation tools today are far better than those available in the wake of the Great Financial Crisis, researchers at the Urban Institute have determined that there is room for improvement. Their first area of focus is the Federal Housing Administration’s partial claim program, which defers the repayment of mortgage principal through an interest-free subordinate mortgage that is not due until the first mortgage is paid off. The Institute research team proposes a more flexible partial claims program.”

“Their proposed change, they explain, ‘would front-load the benefit of a second lien/partial claim to provide a deeper temporary payment reduction than is possible today … a portion of the partial claim amount would be used to reduce the monthly payment … [which] would increase after a few years when the borrower has regained their financial footing.'”

“The researchers say use of this option would maximize the number of FHA delinquencies that can be cured. The second area of focus is homeowner equity. Most borrowers today have positive equity. The existing toolkit is tailored for negative equity situations, and that, they note, means some changes are needed. his chiefly comes into play when foreclosure, home loss, or distressed sales become inevitable.”

“The level of home equity impacts the process, an experience that will affect not only the homeowner, but also mortgagees, secondary lenders, the surrounding neighbors, and more. Thus, the facilitation of efficient move-out is exceedingly relevant, the researchers suggest. ‘When borrowers have exhausted the home retention toolkit and cannot remain in the home, it is important to sell the home as quickly and as efficiently as possible, consistent with maximizing its value,’ they explain. ‘This prevents distressed properties from falling into disrepair and bringing down neighborhood home value. It also maximizes recoveries for the entity on the hook for credit losses, typically the GSEs, the FHA, or the VA.'”

“They recommend the insurer or guarantor on the mortgage foot the bill for a housing counselor that can facilitate a smooth exit while maximizing recovery for the borrower and/or the provision of reasonable relocation allowances. Fannie Mae, Freddie Mac, and the FHA offer up to $3,000 in relocation allowance to borrowers who complete a short sale or a deed in lieu of foreclosure, but the researchers suggest the amount should increase in line with increasing house prices and rents.”

“Another, longer-term solution suggested in the paper: a 40-year mortgage, something the government-sponsored enterprises Fannie Mae and Freddie Mac offer, they point out. The FHA, however, faces two hurdles to this, they report.”

“‘It does not have a portfolio to hold whole loans, and it relies on servicers to modify delinquent loans, which are then securitized again and sold to Ginnie Mae mortgage-backed securities (MBS) investors at the prevailing secondary price,’ they explain. ‘The secondary market for 40-year MBS is small and less liquid. Ginnie Mae recently announced a new pool type to support securitization of modified 40-year loans, but MBS pricing for loans with 40-year terms is less competitive relative to pricing for 30-year terms.'”

“They touch on the risks and potential economical issues related to a 40-year loan, adding that developing this market will likely require a certain degree of government subsidy for investor, servicer, and borrower economics to work. Although a 40-year secondary market is desirable, they say, ‘it is not something that can be expanded in time for the current crisis.'”

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This Post Has 129 Comments

  1. ‘Every month we were taking money out of our personal savings…you know, we’re not getting any revenue from property X…But we are bleeding money every month’

    That’s some red hotcakes right there.

    1. “we’re not getting any revenue from property X…But we are bleeding money every month”

      There isn’t a single owner occupied transaction out there that could positive cash flow if they had to. Not in the last 15 years or more. Not one.

      That’s how long and how many have overpaid.. grossly overpaid for a rapidly depreciating asset…. in this case, a house.

    2. “There’s maybe never been a better seller’s market in America because prices have increased so much,” said Jeff Tucker, senior economist at Zillow. “Homes are selling very quickly almost no matter what condition they’re in. And therefore that is a very tempting window of opportunity especially for a small-time landlord to cash out and sell that home.”

      Tucker’s argument is valid, IMHO. Why hold on to a non-productive asset when you can unload it to a buyer who’ll likely bid above asking?

      1. “small-time landlord to cash out and sell that home.”

        I doubt they will act on it. This is not a smart bunch….will likely double down on their mistakes.

      2. Because it’s still “making $10k per month?” Nobody wants to give away that sweet equity machine.

    3. “They’ve ended up selling half their properties.”

      Assuming you sold for more than what you paid, this might have been a once-in-a-lifetime opportunity to cash out. If it wasn’t penciling all that well at the lower price, what do you think will happen with the new owners? I say count your blessings.

    4. Not surprisingly SCOTUS upheld the eviction moratorium with the help of fake conservative justice hand selected by Mitch The Sad Turtle McConnell. How DJT trusted DC weasels even after getting totally bait and switched on immigration reform by Paul Ryan confounds me. If the unpaid rent was extracted from the CDC budget, they’d end the moratorium in a millisecond.

  2. ‘Fannie Mae, Freddie Mac, and the FHA offer up to $3,000 in relocation allowance to borrowers who complete a short sale or a deed in lieu of foreclosure’

    = better get some boxes.

    ‘‘The secondary market for 40-year MBS is small and less liquid. Ginnie Mae recently announced a new pool type to support securitization of modified 40-year loans, but MBS pricing for loans with 40-year terms is less competitive relative to pricing for 30-year terms’

    = There’s some a$$ pounding going on.

    ‘Although a 40-year secondary market is desirable, they say, ‘it is not something that can be expanded in time for the current crisis’

    Current crisis? That’s not what Larry and the UHS are saying. I guess these FB’s are gonna have to roll with it. Sure some half baked second lien thing is going to spring up and save the day. These people are going to bail by the millions.

    2. We have seen Courts here in San Diego ORDER landlords to pay for “comparable accommodations” in the event of eviction of non-paying tenants.

  4. ‘LVR reported that at the end of June, 2,454 single-family homes listed for sale didn’t have any offer on them…the number of homes listed without offers increased for the fourth straight month in June’

    No offers? But UHS says every shack in Merica sells in minutes, all cash, way over asking. Now Aldo says thousands are crickets?

    ‘many homes with multiple offers usually end up back on the market and ‘are then awarded to the next buyer in line’

    Huh, just like San Diego, the winnahs! are getting cold feet.

    1. I’m pretty sure if the micro transactions data were available, you could see that something similar happened earlier this year with Bitcoin spot market transactions and lumber futures prices at the point of bubble collapse: first every sell order gets filled in an instant, at a higher price than offered, then suddenly the price reaches a level where orders go unfilled, due to a complete absence of bids, after which CR8R. It seems to be a natural consequence of market overshooting when prices rise too quickly for nonfundamental reasons, such as government-sponsored price manipulation.

      It just happens on a far more gradual timescale for housing…like watching an oil tanker try but fail to steer clear of the rocks.

      1. “It just happens on a far more gradual timescale for housing …”

        This is due to the speed of price discovery. With bitcoin and lumber futures price discovery is instantaneous, this is not so with real estate transactions.

        1. Agreed. Real estate price discovery after a CR8R event resembles tornado damage assessment the morning after the storm that destroyed your house.

    2. ‘many homes with multiple offers usually end up back on the market and ‘are then awarded to the next buyer in line’

      The nine back up offers for 16840 Orchard Bend Rd, Poway, CA 92064 went poof. Showings this Saturday per MLS. I’m guessing that $276K price increase from those offers will likewise go poof.

      1. That’s a CR8R event that already started, is ongoing, and seems destined to continue until prices return to normalcy and below.

        The cases I mentioned are those of CR8Rs either waiting to happen, or which have already begun without common knowledge or MSM acknowledgement.

  7. Today is Wednesday, July 14th and Joe Biden is not the legitimately elected president of the United States.

    The 2020 election was stolen.

      1. I still have a hard time believing they got away with (so far) this stop counting cover the windows reverse the landslide preplanned stolen election.

        Not to mention the Pelosi production that was the January 6 https://youtu.be/y8Kyi0WNg40 insurrection.

  8. Is a 9.6 percent price drop in one month during the red hot summer sales alot?

    Has anything similar ever even happened before in Santa Cruz!?
    Oof…

    “Housing prices in Santa Cruz paused their historic upward surge in June, with the median sale price of single-family homes across the county dropping 9.6 percent from unprecedented highs reached in May, according to Aculist.”

  9. Hurry hurry hurry Tillamook 56 ounce ice cream is being discounted 1/2 price so they can put the new improved 48 ounce container in its place…..no inflation here

  10. “When you find a property that you love, you have to step up to the plate and just give them that godfather offer in order to make the deal happen.”

    Yeah right…like give them an offer they can’t refuse?

    Um, no thanks…I’m good with renting until when and if this raging mania subsides, and possibly thereafter.

  11. Here’s a new book released yesterday:

    An Inconvenient Minority: The Attack on Asian American Excellence and the Fight for Meritocracy

    “In my new book, An Inconvenient Minority, I tell the story of the many Asian Americans who are harmed by an ideology that penalizes their success. Progressives “call out Asians for either trying to be like white people or benefiting from systems that prop up white dominance.” Under critical race theory, it also means they are complicit in upholding white supremacy. To be white adjacent is to benefit from the systems of oppression that America was allegedly founded upon.” —Kenny Xu

    2. I think that Asians are far more likely to become part of Corporate America than whites. Have you ever met an Asian electrician or car mechanic? Not saying they don’t exist, but they are rare.

      Anyway, the problem with being a cog in Corporate America is that you will face discrimination unless you are in a protected class. It’s just the way it is.

      1. you will face discrimination unless

        you are ruthless. The weak get picked off rather quickly.

      2. Have you ever met an Asian car mechanic?

        Many years ago when I was selling retail auto parts I dealt with several Vietnamese mechanics who were some of the best “trouble shooters” I’ve ever met, and they knew in minute detail about the vehicle they were wrenching that day. Plus, English was a second (or third?) language!

      3. My car mechanic is Catonese, and we’ve used Chinese plumbers and handyman. I’ve seen other Chinese auto mechanics, and lots of Vietnamese ones.

      4. There are a lot of Asian car mechanics in San Diego. Especially Vietnamese. There are some really enthusiastic Asisn off roaders out here and they build some bad ass rigs. Also lap racing their custom builds is quite popular out here in the Asian community. They have meet ups in parking lots at strip malls and show off their builds.

    3. That’s great. I may pick up a copy to share with my brilliant Asian math student who couldn’t gain admittance to a UC because he is neither a preferred minority, for diversity and inclusion purposes, nor a Chinese national. The California state government routinely charges its hard working citizens a high income tax, then redistributes the money to others in a discriminatory and exclusive manner, in the interests of diversity and inclusion.

      1. nor a Chinese national

        State institutions should not be educating foreign nationals!

        2. State institutions should not be educating foreign nationals!

          They pay full freight, which makes them desirable.

          1. I know. I have two degrees from the UC system, the most recent from 2017.

            US taxpayer-funded institutions shouldn’t be catering to foreign nationals at the expense of state residents and US citizens.

      2. P Bear, if anyone in the UC system traces this post back to you, you are going to be escorted off campus by security and your tenure will cancelled.

  13. Back To The Futures

    Home Depot 15/32 (1/2) plywood

    6/10/21
    $74.65
    Buy 72 or more $67.19

    7/14/21
    $54.65
    Buy 72 or more $49.19

  14. Wonder how the house prices are doing in South Africa, with all that going on ? There really is no “Free Lunch” , though a growing number of the US population thinks there is……

    1. I actually read a WSJ piece yesterday regarding the riots in South Africa that included photos of vibrants looting. I thought such imagery was banned in the woke media?

      1. It’s kind of hard to not show it when 90% of the population are orcs. I’m sure the MSM tried to memory hole this, but it wasn’t possible.

    2. “There really is no ‘Free Lunch’”.

      Bahahahahahaha … what I freely get to enjoy comes close. Dumb-assed pukes work their tails off for money and then willingly send to me huge chunks of this haed-earned money each and every month, just like clockwork.

  15. We’re on Day 3 of smoke from area fires in the Columbia Basin. No bicycle fitness training happening here. 🙁

      1. Yeah, my wife has a magnetic recumbent trainer. But after five months of ice and snow I’d rather not touch it until Nov.

  16. This is just Communist BS to attack systems based on merit and achievement for the Communist illusion that everything can be made equal by Top down rule by Dictorship.
    It becomes even more absurd that Private Party Globalist Monopolies want to be the Rulers.
    Under Communism there is no private property and the State owns all means of production to disperse equally. So big Monopolies ruling while they maintain private property ownership doesn’t follow the Communist Ideology of no private party ownership.
    These Entities have already looted and rigged the systems and have corrupted the Government and Government agencies.Look at all the Monopolies controlling everything right now from Fake news censorship , Medical Tyranny, Government relief packages going to them, Monopolies prospering by the lockdowns while small business was destroyed.
    Look how Gates is buying up all the farmland.

    The pushback by Trump voters to get rid of the Obama care mandate , which was the set up for more control and looting by the Medical/ Big Pharmacy Monopoly was most likely the biggest enemy of Trump.. But all the big Monopolies are in collision on this power grab and they criminally rigged the election, along with some foreign enemies no doubt.

    2. “Look how Gates is buying up all the farmland.”

      Owning <0.00003% of tillable acres isn't remotely close to "buying up all the farmland."

      Remember…. There's a globe full of land where 95% of it goes undeveloped.

        2. He got it out of his fat a$$. A little duckduckfu say:

          Bill gates: 242,000 acres
          Arable land in the US (2016): 376,248,499 acres

          Bill Gates’ fraction is 0.000643 of total arable land, or 0.064%.

          3. Here’s the word from Vox:

            On Tuesday, NBC News reported that the Gateses had acquired more than 269,000 acres of farm in the United States in the past 10 years. Those purchases, made with the help of the Washington-based firm Cascade Investment and a number of shell companies, include farmland in nearly 20 states that cultivate vegetables such as carrots, soybeans, and potatoes (some of which end up in McDonald’s French fries).

            https://www.vox.com/recode/22528659/bill-gates-largest-farmland-owner-cascade-investments

          4. He got it out of his fat a$$

            Hey Poster Child Donkey, what is percentage of US arable land of all arable land?

          5. This is where I got the number (in hectares).

            https://www.indexmundi.com/facts/united-states/indicator/AG.LND.ARBL.HA

            Here’s the definition: “Arable land (in hectares) includes land defined by the FAO as land under temporary crops (double-cropped areas are counted once), temporary meadows for mowing or for pasture, land under market or kitchen gardens, and land temporarily fallow. Land abandoned as a result of shifting cultivation is excluded.”

            So, arable land basically means tillable and under a plant crop. The definition for Mafi’s number is “total land in farms.” I’m guessing that this includes ranchland and barns for hogs etc, which is why the number is much higher. However, we don’t know what type of farmland Bill Gates owns, so I see no reason to argue.

          6. Landsat is a joint NASA and USDA effort. The mid-west is where “big ag” is really happening. Out west it’s the CA Central Valley and eastern WA. The balance are patches of specialty crops like tobacco or sugar cane in the humid regions of the south-east. Gov built irrigation systems are typical in the arid West whereas crop support programs are popular east of the Mississippi. Note the various crop regions in the video.

            NASA Satellites Keep Watch on U.S. Food Supply
            https://www.youtube.com/watch?v=vOAuMkprG7k

  17. I keep a close watch on this heart of mine
    I keep my sleeves rolled down bout all the time
    Faucci and Bill Gates can keep on cryin’
    My arm is fine, no jab in mine.

    I find it very, very easy to see you
    I breathe just fine when each day is through
    With your jab I can tell you what to do.
    I know you’re lyin’ my arm is fine

    As sure as night is dark and day is light
    There ain’t been one time when Faucci was right
    There is no end, to this bullsh#t in sight
    My arm is fine, no jab in mine.

    You’ve got to try to keep the masses on your side
    Your Marxist plan is something you can’t hide
    You funded Wuhan and you took us for a ride
    I know you’re lyin’ no jab in mine

    I Walk the Line
    https://youtu.be/oQFicmUfKi4

  18. From the DMN – paywalled:

    Home sales prices in two North Texas counties — Collin and Denton — have rocketed to $400,000 and more this year.

    Collin County had the highest prices with a median of $440,000 in June. That compares to a median price of $350,000 for all of North Texas, which is up 23% from June 2020.

    North Texas have prices have risen by almost 50% in the last five years.
    June home sales rose from a year ago in two D-FW counties. Single-family home sales were up about 7% year-over-year in Dallas County. And Collin County had a more than 4% sales increase from June 2020.

    Surprising that volume is up recently. There is a ton of infill building. 28 $900k – $1M homes are going up on six acres near me. They tried to change the zoning to do 48 zero lot homes but couldn’t get it past local opposition/city council.

    1. They tried to change the zoning to do 48 zero lot homes but couldn’t get it past local opposition/city council.

      Million dollar, zero lined lot homes … in Texas.

      2. The homes they’re building are on ~.21 acres, nice sized lots, especially nowadays. The zero lot homes didn’t get approved. It is a pocket type parcel of land so no direct access to a major road. None of the neighbors wanted the traffic that goes with 48 homes. All any developer could do is 28 homes, which is what the original zoning was from way back in the 60’s. Of course they had to scrape it first. Too bad as it had some nice trees, is adjacent to a creek, and housed our local bobcat.

        1. ‘Too bad as it had some nice trees, is adjacent to a creek, and housed our local bobcat.’

          Wolfen II : Feline Rage , starring Kevin Bacon

  21. I got a Donk she ain’t go no equity,
    A cash out refi was her friend.
    I got a Donk she ain’t go no equity,
    A cash out refi was her friend.

    Stamping her feet in circles,
    Losses gonna rise like a bird up in the sky,
    Stamping her feet in circles,
    Losses gonna rise like a bird up in the sky.

    https://youtu.be/ghj5V5cUo1s
    Billy Preston – Will It Go Round in Circles

    Tolleson, AZ Housing Prices Crater 15% As Phoenix Housing Market Chokes On Subprime Mortgages

    https://www.movoto.com/tolleson-az/market-trends/

      1. Who was the outfit that made the cartoon? Is there a way to confirm that the text slides were authentic and not faked in?

  24. Pukes work, bankers reap.

    A book:

    13 Bankers | The Wall Street Takeover and the Next Financial Meltdown
    https://13bankers.com/

    (a snip from a review of the book)

    “The Wall Street banks are the new American oligarchy— a group that gains political power because of its economic power, and then uses that political power for its own benefit. Runaway profits and bonuses in the financial sector were transmuted into political power through campaign contributions and the attraction of the revolving door. But those profits and bonuses also bolstered the credibility and influence of Wall Street; in an era of free market capitalism triumphant, an industry that was making so much money had to be good, and people who were making so much money had to know what they were talking about. Money and ideology were mutually reinforcing.”

    1. (here is another snip from the review of the book)

      “The title of this book is taken from a meeting held at the White House on March 27, 2009. In attendance were the heads of thirteen major U.S. banks (as well as representatives of two banking industry associations). The thirteen bankers, as reported by The Wall Street Journal, were:

      Ken Chenault, American Express
      Ken Lewis, Bank of America
      Robert Kelly, Bank of New York Mellon
      Vikram Pandit, Citigroup
      John Koskinen, Freddie Mac
      Lloyd Blankfein, Goldman Sachs
      Jamie Dimon, JPMorgan Chase
      John Mack, Morgan Stanley
      Rick Waddell, Northern Trust
      James Rohr, PNC
      Ronald Logue, State Street
      Richard Davis, US Bank
      John Stumpf, Wells Fargo
      We chose this meeting because it aptly symbolizes the solidarity between the new Obama administration and the major banks at the depths of the financial crisis and recession. Speaking with reporters after the meeting, White House press secretary Robert Gibbs said, ‘We’re all in this together,’ a phrase repeated by multiple bank CEOs. This contrasted with the new Franklin Delano Roosevelt administration of 1933, which largely froze out the bankers, much to their chagrin.

      “This is also the meeting at which Obama said, ‘My administration is the only thing between you and the pitchforks.’ This was the point at which the government had to decide if it would defend the financial oligarchy from populist outrage, or whether it would reform the financial system that brought us the financial crisis and severe recession. We do not think it was an easy choice. But ultimately Obama and his advisers chose to bet on the bankers they knew. The result has been even larger banks and an even more concentrated financial sector.”

      😁

  25. Tucker’s lead story tonight from a whistle blower, military air bases being used to fly undocumented immigrants in large numbers into the interior of the country and the servicemen and woman on the bases being told not to take pictures, talk about it or put it on social media.

    2. Given how Hispanics are displacing blacks in many areas, I’m surprised that black leadership isn’t complaining. Surely, they know that the day when Hispanics completely shove them aside politically isn’t far off.

      1. Per Rasmussen Reports this week, 59% of Blacks don’t think laws requiring voter ID discriminate against some voters.

      2. In the [labor] workforce Hispanics are displacing everyone in my area. The big farms won’t hire blacks or whites because they can’t (or won’t) work a full day.

        1. The narrative that Mexicans outwork Americans is false. The only thing they can do better than Americans is accept lower wages.

          1. I’ve worked with a corp farmer and a large concrete contractor, both who sweat their employees relentlessly. And I’ve observed Hispanics at other job sites. The only semi-white guy around is the dual language trail boss.

  26. Here’s a new documentary, 54 minutes, from PBS’s frontline, called “The Power of the Fed”: https://www.pbs.org/wgbh/frontline/film/the-power-of-the-fed/

    Frontline did “The Untouchables” back around the GFD, showing how the malfeasance on Wall Street went unpunished, and why.

    This piece is reasonably balanced. Basically, three parts: What the Fed did during the GFD and covid; those who think it’s a problem; and those who think it’s not.

    It’s slated for airing on DC PBS, but I watched it online (don’t play the trailer, the full piece is that big image in the middle of the screen).

    Sheila Bair put it best IMO: these bailouts are the biggest threat to capitalism.

    1. I stopped sending money to PBS. The other day I got a beggy letter from PBS, saying “You used to be one of us. You never let us down. We counted on you.” I’m debating whether to just throw it out, or send them a nastygram.

      First draft of nastygram: “I counted on you for real news and all I’m getting is slanted garbage propaganda. You block comments on your YouTube channel. I counted on your for science/history programming and all you do is flog climate change. I counted on you heavily for home and garden programming and you replaced it with pre-canned warmed-over leftovers from the BBC. So, as the BBC would say, sod off.”

      What do y’all think?

        1. Yeah, that’s my thought too. I’m sure they already know why they are losing donors. Felt good to get it off my chest here on HBB tho.

      3. I used to like PBS pre-GFD. They went down the tubes for a while afterwards. In their favor, they had things like the Ken Burns Civil War documentary and other epic productions. There’s Nova, Nature, and of course the woodworking and house shows, long before they were cool, and done way better than they are today IMO. I don’t watch that much TV nowadays, but if I did, it would probably be PBS.

        Frontline has always been solid and worth supporting.

    2. “Here’s a new documentary…”

      That was a great refresher of what most everyone here already knows. Of course when these economists talk about the economy stopping they’re really talking about debtors NOT making their payments. The small percentage of everyone else with clean soft hands are on the good side of that compound interest formula, and they expect the fed to keep the proverbial floor under asset prices intact!

      1. Kashkari’s take was interesting:
        * Who cares if the wealthy are getting wealthier? How does that hurt anyone?
        * We’re helping the poor and in fact they say we’re not doing enough.
        * We take no blame for negative effects typically blamed on monetary policy.

        This of course begs the question of whether they’re actually helping the poor; what are the costs of firehosing so much money at the wealthy?; if you take credit for helping the poor in some nebulous way, how do you not take responsibility for any negative effects.

        Kashkari uses the fact that it’s hard to demonstrate the effects of monetary policy so he’s able to play these take-credit/assign-blame games.

  29. WSJ News Exclusive
    Central Banks
    Fed’s Bullard: Time Is Right to Pull Back on Central Bank Stimulus
    ‘I am a little bit concerned that we’re feeding into an incipient housing bubble,’ St. Louis Fed president says
    James Bullard, president of the Federal Reserve Bank of St. Louis.
    By Michael S. Derby
    July 13, 2021 5:30 am ET

    Federal Reserve Bank of St. Louis President James Bullard is ready to start slowing the pace of central bank bond buying as soon as his colleagues are, worried in part that the purchases risk overheating the gangbusters housing market.

    “I think with the economy growing at 7% and the pandemic coming under better and better control, I think the time is right to pull back emergency measures,” Mr. Bullard said Monday in an interview with The Wall Street Journal.

    When it comes to the outlook for the Fed paring its purchases of Treasury and mortgage bonds, “we do want to do it gently and carefully, but I think we’re in a very good position to start a taper. I don’t need to get going tomorrow, but I think we’re—I think we’re in very good shape for this” once the collective membership of the Federal Open Market Committee is ready to act, Mr. Bullard said.
    …

    1. Rounding the corner?

      “…the average sale price per square foot in San Francisco is actually down 2 percent over the past year, not up, to around $1,035 per square foot.”

  31. Earlier in the year, rising lumber prices were instantly lapped up by MSM financial journalists to help explain bubbly housing prices. But now that lumber has cratered, housing prices are nonetheless predicted to remain suspended in the stratosphere indefinitely.

    Perhaps housing prices have achieved a permanently high plateau?

    1. The Wall Street Journal
      Commodities
      Lumber Prices Are Way Down—but Don’t Expect New Houses to Cost Less
      Futures prices have dropped by about two-thirds since May, helping builders and do-it-yourselfers
      How the Pandemic Made Lumber America’s Hottest Commodity
      By Ryan Dezember
      Updated July 14, 2021 4:57 pm ET

      After rising to shockingly expensive levels this spring, lumber prices have fallen so far that they are starting to look cheap to some buyers.

      Prices for two-by-fours surged in May to more than twice their previous record, set three years ago when there were about 15% fewer homes being built. But wood prices have since plunged back to levels resembling those before lockdowns cut supplies short and boosted demand.

      July futures ended Wednesday at $521.40 per thousand board feet, down nearly 70% from the high of $1,711.20 hit in May, when wood-product supply lines were still being unknotted after the lockdown and before Americans began to shift spending from home improvement projects to vacations and dining out. More actively traded futures for September delivery settled at $612, which is $27 below the pre-pandemic high.

      The decline is benefiting builders and do-it-yourselfers and helping to allay fears of runaway inflation hamstringing the economic recovery. Still, buyers of new homes shouldn’t expect discounts.
      …

      1. Dumb question of the day:

        Given growing evidence in cratering lumber futures that we are not running out of trees, is it possible that we are also actually not running out of houses, and that housing prices may soon follow other pandemic stimulus bubble assets into the crater?

  32. Charlotte, TN Housing Prices Crater 21% As Rural Lot And Bulk Land Values Plunge

    https://www.movoto.com/charlotte-tn/market-trends/

    As a national land broker explained, “There is a globe full of land were fully 95% of it goes undeveloped. Land is essentially worthless dirt. If you paid more than $500 an acre, you got ripped off.”

  33. She is usually good at it, but although she tried Psaki couldn’t physically hide her disdain for the question about communism.

    @DailyCaller
    ·
    18h
    Peter Doocy asks why the U.S. is rejecting refugees from Cuba

    “Do you think that people are leaving Cuba because they don’t like communism?”

    @PressSec
    : “I think we’ve been pretty clear… they are opposed to the oppression to the mismanagement of the government in the country.”

    https://twitter.com/DailyCaller/status/1415358760168611850

  34. The Financial Times
    Blackstone Group LP
    Blackstone doubles down on US housing with $5bn deal
    Private equity giant snaps up affordable apartments in second big bet on sector within a month
    The housing purchase is part of a $7.3bn deal with AIG, under which Blackstone will also take a 9.9 per cent stake in the insurance group’s life and retirement business
    Mark Vandevelde in New York yesterday

    Blackstone has agreed to buy a $5.1bn portfolio of rent-controlled apartments geared towards low-income families in its second big bet on the US housing market in less than a month.

    The deal covers 678 “affordable housing communities” in cities including Boston, San Francisco and Seattle, according to a person familiar with the terms.

    All of the developments have received tax credits from the US government in exchange for agreeing to stringent restrictions on rent and occupancy that are intended to make it easier for people on low incomes to find homes.
    …

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