Thursday, January 11, 2007

January Update

Homes for sale in my hometown Newton, MA. From,

April 26, 2006 704

May 18, 2006 724

June 21, 2006 776

August 15, 2006 685

September 12, 2006 673

November 21, 2006 607

December 18th, 2006 476

January 3rd, 2007 388

Wow. Listings continue to crater. (I predict this will be the bottom for listings.)

Some of the dip is likely due to seasonality, but it hardly explains the entire magnitude. And the drastically lowered supply hasn't induced so much as a fleeting price uptick.

My worst case scenario continues to play out for real estate. The market is staying high for a long time, sucking more and more first time buyers in. As I mentioned in my last real estate post, mortgage rates have been dropping since June - over 70 basis points. Increasing purchasing power has been unable to stem the abrupt sales deceleration or price softening.

Many people insist that the market has already corrected significantly and that "the worst is over". While enthusiasm may have abated, PRICES ARE STILL WAY TOO HIGH. Mind you the overall economy has been very strong this year as well. What do you think will happen to house prices when any or all of this inevitably occurs: rates rise, the economy slows, stock market dips, oil rises, etc?

Denial is always the first stage...

Now take a look at the 2006 housing predictions and eventual realities from the National Association of Realtors, Mortgage Bankers Association, the National Association of Home Builders, and the California Association of Realtors.

Note just about all of their housing market predictions fell short even though their economic predictions underestimated the strength of the economy.

I am fully aware that these are positively biased advocacy groups but bear in mind their predictions are qualified by interest rate and unemployment data.

I want to reiterate my theory:

The dominant variable for house price prediction is PRICE MOMENTUM.

Right now, the real estate market is a massive barge drifting downstream. What, does the unemployment rate have to go to 2% for prices to uptick? There's nary a tugboat in sight...

Sorry, I was about to move on from this tedious subject but recently new homebuilder Hovnanian Enterprises announced its earning results. They sucked.

Its earnings were down 70% from 2005 to 2006 ($7.16 vs. $2.14) which to me isn't even the worst news. (These companies play games by aggressively "writing down" land, I cynically think it's to make future earnings appear better).

The worst news is no matter how much Wall Street or homebuilders reduce their expectations, reality keeps arriving much worse than they feared. Hovnanian is reducing its earnings forecast for 2007 from a previously announced $2.50 down to anywhere from $1.50-$2.00 per share.

A mere three months ago, the already several-times lowered Wall Street earnings forecast for 2007 was at $3.29.

Now I am not saying that HOV will lower estimates again or won't meet the "new" forecast. In fact I find these new construction builders to be a wholly inadequate proxy for the larger housing market. I just want to highlight how prevalent the housing market denial is. This bear market narrative is a familiar and crystal clear story to me; I guess because as a trader, I have owned more than my fair share of rapidly depreciating assets. The first leg down is always "unexpected" and "healthy" and it invariably occurs within a worry-free context. Today the benign backdrop is a strong economy and bargain basement interest rates. Not until after the assets have already taken a beating does the bad news crash the party, proliferate, and cause the much nastier second leg of the implosion.

Here's some trenchant evidence of the Religious Right's stranglehold on America:

37 Percent of U.S. Births Out of Wedlock, an all-time high.

Consider that with the prevailing 50% divorce rate and the thorough skankification of television. Anyone who believes in the Religious Right's omnipotence remains thoroughly ignorant of history. Put in it's historical context, this really is a Post-Christian Era for Western Civilization. Separating the "church" from the "state" has proven a healthy move for both entities. Unfortunately the state has been hijacked by another creed. Statists today engage in the same fascist thought control, censorship, and insidious servitude typified by Louis XIV's Catholic France.

There's talk amongst ascendant Congressmen of making college tuition tax deductible. If they do this, tuition prices will simply continue skyrocketing. The mortgage interest deduction and the health insurance tax deductions have only made homes and medical care more expensive, so why do the pols think tax deductibility will help make college more affordable?

Do the pols know the deduction won't work and advocate for the econo-illiterate populist measure anyway?

Or are they just too stupid to even see the empirical evidence against their proposal?

Either way, that's one sad set of lawmakers we have.

While Harvard economist Greg Mankiw won't stop complaining about the distortionary economics of agricultural subsidies I wouldn't hold your breath waiting for him to inveigh against making tuitions deductible, a subsidy that would only increase his paycheck. Tuition could cost ten grand, fifty grand, or one hundred grand and academic economists would still insist the money well spent.

Speaking of agricultural subsidies...

What is the government's solution to oil inflation?

Well, it's inflating other vital commodities like corn and gasoline.

According to this website,

The Klan had much to do with the early gun control laws in America. Many of the current gun control laws stemmed from the fear of armed and independent minorities. After all, even a few determined (and armed) people can stop a Klan raid or make committing massacres like the 1923 Rosewood events too risky for the perpetrators.

Now query this - Is abortion racist?

Minority women constitute only about 13% of the female population (age 15-44) in the United States, but they underwent approximately 36% of the abortions.

Of course one could easily argue that government schools are racist. They are poorly run and disproportionately attended by minorities. What else is needed for the racism equation?

So when will race-baiters like Jesse Jackson start inveighing against public schools, abortion, and gun-control?

Haha. They won't. Remember, Big Government socialism comes first, then all of the sub-agendas like identity politics, environmentalism, etc.

Conclusion - Historians one hundred years from now will have a heck of a time figuring out what "racism" meant in our day.

Speaking of minorities and public schools, be sure to watch The Wire on HBO. The season has concluded but can be viewed OnDemand. This year the Baltimore-based show highlights the realities of public schooling in urban drug-infested areas. Almost needless to say, such schools are scary places for all involved.

ESPN's Bill Simmons says The Wire is one of the most underrated shows on television. (I don't know why I am quoting that tool....he should be quoting me!)

Check out Harvard/Microsoft geek Steve Ballmer below.

Boston just passed a law mandating Green regulations for all new buildings over 50,000 square feet. Here is the comment I left on the above hyperlinked blog,

When the city with the highest business costs in the country (200th place according to Forbes) decides to heap more onerous expenses on job creators, all that will cause is more people moving to less “green” cities. After all, everyone has to work.

Boston simply isn’t economically wealthy enough to indulge in environmental fetishes.

Morons are always criticizing, fighting, and saddling with regulation new construction - be it commercial or residential. One key point that the Naysayers miss is that newer buildings are much more energy efficient than existing structures. Old homes and buildings kill utility bills in both the winter and the summer. They have drafty windows, inferior insulation, a dearth of ceiling fans, and antique heating and cooling systems. Environmentalists, or should I say Watermelons (green on the outside, Commi red on the inside) may get, two big green buildings built downtown, but their larger portfolio of regulations keeps thousands upon thousands of drafty oil burning shacks in the housing stock.

Similarly the Landmarks Preservation Commission in New York City also rapes the environment by preventing the modernization of buildings (and consequently drives up the cost of living for everyone as well).

There's no short list of negatives to living in Boston. Consider the amount of daylight in the following cities this time of year.

9 hours 11 minutes in Boston, Massachusetts.

9 hours 52 minutes in Charlotte, North Carolina.

10 hours 32 minutes in Delray Beach, Florida.

My friends in Delray Beach (recent New Jersey emigrants) enjoy an hour and twenty-one minutes more sunlight than us miserable denizens of Boston.

The sun is not only out less up here, it takes a lower path in the sky so it depressingly never gets really bright - that is of course when it deigns to come out at all. Incidentally, that is probably the only thing I learned in astronomy class at UPenn.

It was a "gut class" in which I did miserably. I skipped class too often and actually flunked the midterm - likely the only F I ever received. There was a lab report assigned that had to be done at the University Observatory (on a cloudless night). The syllabus stated that if it was done "before Spring Break" it would count towards 10% of your grade. Me and a buddy who were taking this class procrastinated some and didn't get the lab done before Spring Break. We came back from Florida to this announcement from Professor Shen,

"Those of you that didn't get the lab done just lost 10 points off your final grade..."

The class went into uproar (at least those who hadn't done the lab yet). We all just assumed that not doing the lab early would just shift the grading weight to the final (or midterm exam). These are the hazards of taking classes taught by ESL professors.

So with an F on the midterm and 10 additional points gone, I had to, and did, ace the final just to salvage a C+ in the class. Hey, at least I learned about the southern arc of winter sun!

I wonder if Professor Shen translated the directions for this noodle manufacturer. (Click to enlarge).

Here's a funny and revealing headline story from Reuters,

European Socialists eager to work with U.S. Democrats

Why aren't they eager to work with Republicans?

And Hillary Clinton is playing hard-to-get with a French Socialist leader...

Big Government nannies are now insisting that the Obese should have health warnings on their clothes. Personally I am against almost all warning labels on products. But if they are going to be mandated I strongly feel that newspapers should warn readers that consuming their product can make one ignorant, stupid, depressed, poor, and will embarrass them to no end when they try to converse with the informed.

Vienna to get gender-equal traffic and exit signs

Female exit signs and pictograms in bathrooms featuring a man, rather than a woman, changing a baby, will be introduced at City Hall to start with, the statement said.

Some loser male student at Clark University wanted to room with a female in the dorm but the school wouldn't let him. According to the local arm of the New York Times,

Mr. Chang researched the issue extensively and submitted a 70-page proposal.

Seventy pages? Can you say LOSER?

Buoyed by his victory and blooming ACLU street cred, the idiot went national, starting From that site,

They all, however, call for the option for any two students to room together, in mutual agreement, without restriction based on biological sex or gender identification.

Gender-neutral housing policies provide options for transgender students, students in the process of discovering their gender identity, gay or bisexual students who feel uncomfortable with rooming with members of the same sex, intersex students who do not wish to be identified by any sex, and students who feel that they would cooperate better with a roommate of the opposite sex. The NSGC believes that current policies, without gender-neutral options, reflect a time of institutionalized heterosexism that marginalizes countless students today.

"Institutionalized heterosexism"? "Intersex" students?

If anyone instituted heterosexuality in humans it most likely was Father Nature.

How long before some college boy comes back to the dorm drunk and has non-consensual sex with his female roommate? That ought to be a nice windfall for the victim's attorney.

This has been widely disseminated but it merits another mention.

Incoming House intelligence chief botches easy intel quiz

WASHINGTON (CNN) -- Rep. Silvestre Reyes of Texas, who incoming House Speaker Nancy Pelosi has tapped to head the Intelligence Committee when the Democrats take over in January, failed a quiz of basic questions about al Qaeda and Hezbollah, two of the key terrorist organizations the intelligence community has focused on since the September 11, 2001 attacks.

Now we have a nasal spray to thwart the obesity epidemic. Supposedly we can't crave what we don't smell. Medicare will probably approve billions for the nasal spray even though a simple clothespin will surely beat the spray in "blind taste tests".

Flatulence, not turbulence forces plane landing in Nashville

American Flight 1053, from Washington Reagan National Airport and bound for Dallas/Fort Worth, made an emergency landing here after passengers reported smelling struck matches, said Lynne Lowrance, a spokeswoman for the Nashville International Airport Authority.

The plane landed safely. The FBI, Transportation Safety Administration and airport authority responded to the emergency, Lowrance said.

The passengers and five crew members were brought off the plane, together with all the luggage, to go through security checks again. Bomb-sniffing dogs found spent matches.

The FBI questioned a passenger who admitted she struck the matches in an attempt to conceal body odor, Lowrance said. The woman lives near Dallas and has a medical condition.

The flight took off again, but the woman was not allowed back on the plane.

"American has banned her for a long time," Lowrance said.

Snake king Ali Khan dies from cobra bite

If one plays with fire he is eventually going to get burned. Throw that story in with Steve Irwin and Roy Horn.

Paper Money Discriminates Against The Blind. The government has been ordered by a compassionate judge to make "braille bills". Next up for the ACLU is most assuredly the nasty prejudice of iPods against the deaf...

I am no fan of Thanksgiving. Turkey is boring, traffic is brutal, and the holiday is too close to Christmas. What a waste!

But I am not hijacking the holiday to instill self-loathing in little children like this teacher.

Teacher Bill Morgan walks into his third-grade class wearing a black Pilgrim hat made of construction paper and begins snatching up pencils, backpacks and glue sticks from his pupils. He tells them the items now belong to him because he "discovered" them.

When Massachusetts' newly elected governor, Deval Patrick, was running for office he had to debate Kerry Healey and her proposal to immediately cut the state income tax from 5.3% to 5%. Patrick said such a tax cut wouldn't "work", it would just shift more of a burden on "our cities and towns". This is essentially a socialist's stock debating response to any and all tax cuts. To them, cutting taxes has never in the history of mankind been desirable or "effective".

Both of Patrick's gubernatorial opponents, Healey and Christy Mihos, campaigned to remove the tolls west of route 128 on the Mass Pike. Though Patrick demurred on this proposal, nonetheless the notion got some legs from the election. But note again the tired argument put forth to keep the tolls in tact,

BOSTON --Eliminating tolls on the Massachusetts Turnpike west of Route 128 could force up tolls on the road's Boston extension and harbor tunnels, according to an inspector general's review of legal and financial opinions to be presented to the Turnpike board Wednesday.

Inspector General Gregory Sullivan said those legal and financial opinions, which he reviewed, show that taking down the western tolls would mean sharper toll increases for anyone using the portion of the Turnpike from Route 128 to Boston or Logan Airport.

Under one scenario, cars traveling from Logan Airport to Weston would see tolls jump from $5 to $7.31, an increase of $2.31 per trip, Sullivan said in a letter to legislative leaders and Turnpike board members dated Tuesday.

The increase would be needed to because the Turnpike would have to raise roughly $30 million more in tolls to meet its bond obligations, according to Sullivan.

Anytime there is a budget crunch or a fleeting moment of taxpayer restlessness, the socialists trot out the same arguments and innuendo. The country is broke? Well then we shouldn't stop spending, we should instead tax the rich. They must not be paying their fair share. Thou shall approve more spending (i.e. bonds) for education or we will cut out high school sports. Not only does that hit parents and students where it counts, there isn't a union to defend sports from such venomous threats. Note they never threaten to remove "vital" administrators or librarians. Cut out the Western Mass tolls? Well if you do that Eastern Mass (Boston) will have to bear the burden - because there is just no way us pols will ever cut wasteful spending. Seven dollar tolls from Weston? Well that happens to be the richest town in Massachusetts; so find it curious that socialists have incorporated that town's misery into their agitprop. It just happens to be right at Route 128 and hence the steepest toll if Western tolls should be eliminated.

The masterstroke has been to make everyone dependent on the government in one fashion or another: public education, student loans, Medicare, Social Security, or working for a government agency. Surely you and your dear friends and family have lips firmly planted on a government teat. Any proposed tax decrease or reform is invariably met with strategically placed threats to reduce spending (no more milk!) or increase taxes elsewhere. The game plan remains to inure voters to high taxes and wasteful spending so that the socialists can run up the score - no timeouts will be allowed. Big Media ostensibly referees, but does so with the probity of Soviet Olympic judges. They refuse to ever report on the wanton squandering of tax revenue - and hardly for lack of material. (Only "Iraq" is a waste of money.)

Science told: hands off gay sheep

SCIENTISTS are conducting experiments to change the sexuality of "gay" sheep in a programme that critics fear could pave the way for breeding out homosexuality in humans.

The technique being developed by American researchers adjusts the hormonal balance in the brains of homosexual rams so that they are more inclined to mate with ewes.

It raises the prospect that pregnant women could one day be offered a treatment to reduce or eliminate the chance that their offspring will be homosexual. Experts say that, in theory, the "straightening" procedure on humans could be as simple as a hormone supplement for mothers-to-be, worn on the skin like an anti-smoking nicotine patch.

The research, at Oregon State University in the city of Corvallis and at the Oregon Health and Science University in Portland, has caused an outcry. Martina Navratilova, the lesbian tennis player who won Wimbledon nine times, and scientists and gay rights campaigners in Britain have called for the project to be abandoned.

Navratilova defended the "right" of sheep to be gay. She said: “How can it be that in the year 2006 a major university would host such homophobic and cruel experiments?" She said gay men and lesbians would be "deeply offended" by the social implications of the tests.

Approximately one ram in 10 prefers to mount other rams rather than mate with ewes, reducing its value to a farmer. Initially, the publicly funded project aimed to improve the productivity of herds.

So let me get this straight. There's no outrage over aborting fetuses that may have Down Syndrome but prescreening out the homosexual gene is "cruel"? By this logic no scientists will be allowed to find the obesity gene because it would be "deeply offensive", "cruel", and trample on the "right" to be fat.

When will these people realize that the right to be gay, fat, and retarded approximates a "right to life"?

Now I have mentioned this a few times...

A report card on youths' weight irks Cape parents

BARNSTABLE -- Almost 140 Hyannis Elementary School students went home last week with letters implying that they might be at risk for becoming underweight or overweight after a height-and-weight screening.

The school nurse, Stacey Shakel, said the letter had been meant as an education tool, not an insult.

In addition, state law requires that a school notify parents of children who are overweight or underweight, or who may be at risk of becoming so. About half of the Hyannis school's students got letters.

Elliott's third-grade daughter does not think she's overweight, Elliott said, adding that reading the letter upset her. "I don't agree with the policy," she said, "but if you're going to do it, don't send [the letter] home with the kids."

The Barnstable school district conducts height and weight screening on students from kindergarten through eighth grade. Superintendent Patricia Grenier said that the district could not afford to mail all the letters, and that in the end there's a payoff.

"Healthy children learn better," she said.

Hah! Did you get that? Fat kids can't read, write, or add.

In the end there is a "payoff"? Yeah, government schools are veritable founts of "payoffs" these days.

Anyone that thinks "unhealthy" kids can't learn hasn't intellect enough to be anywhere in the educational field - no less a superintendent. Anyone who's ever opened a history book knows that "unhealthy" people have risen to become some of the greatest achievers of Western civilization.

They were teaching "nutrition" in government schools twenty years ago when I was a inmate student and look at the burgeoning obesity epidemic since then. Where was the "payoff" for that?

Devil's Advocate - Well, maybe the epidemic would be worse if they hadn't started the education back then...

That's a tired excuse for failed Moronic measures. File it under the IF, COULDA, SHOULDA, WOULDA...

When arguing with Morons, never let them get away with this tactic. To them, poverty would be worse without welfare, we could fall behind Japan China if more money isn't spent on education, the elderly would be eating dog food if we reform Social Security.

In a nanosecond I found the following link and pic below.

Now I don't recommend arguing theoreticals with anyone, no less Morons, BUT for entertainment purposes one could use this tactic to dominate a debate.

Well how about this - Terrorism WOULD be a lot worse if we didn't fight it?

Or - A dollar tax on gasoline WOULD force the elderly to live on Alpo?

Those may not be the best examples but it's important nevertheless for a professional Marginalizer to be able to both recognize and exercise sophist debating tactics.

John Gatto introduced to me to an animal I was previously ignorant of - the utopist. Though an infinitely mutable creature, throughout history he's always believed in one borderless world, one set of laws, and one world government; by definition, the utopist is wholly intolerant of all other visions.

Who are they? Outside of the thuggish dictators and their minions, they are the True Believers at the United Nations, the International Monetary Fund, and the World Bank. They are eternally in search of larger mandates and of course more money and power.

I may have mentioned it already but I'll note it again. The issue could be "global warming", global cooling, global temperature stagnation, or thwarting an Earth-bound asteroid. Utopists will support whatever alarmist movement that enlarges their canvas.

There's no competitive market for world governing organizations. All global causes must run through the above loci of power and the the nascent European Union. Global carbon taxes are simply a back door push for world government by unblinking idealists.

Count my deplorable Congressman Barney Frank (prior post) among the utopist crowd. The new chair of the House Financial Services Committee is amenable to international securities regulation. Don't fall for his double-speaking cant.

Financial regulators on both sides of the Atlantic may not be able to resolve policy disputes through co-operation and the creation of a global regulator should be considered, according to Barney Frank, the senior Democratic congressman.

Asked if a supra-national regulator would be needed, he told the Financial Times: “I don’t know. At this point that’s something to look into.”

If CaptiousNut had absolute power, he'd immediately withdraw the United States from all of these world governing institutions, most prominently the United Nations. I understand what President Bush tried to do, sending the pot-stirring John Bolton up there in efforts to reform the aimless institution. Even if it succeeds in the short term, the inherently flawed animal would sooner or later recidivate under subsequent apathetic or sympathetic administrations.

Oh yeah, my favorite Congressman also got into a heap of dung this week for accusing the Bush Administration of "ethnic cleansing" via Hurricane Katrina. Read the transcript of what he said, muttered, and insinuated:

"And, what I believe is, at this point you’re not talking about [inaudible], but what you’re talking about is, I think, a [inaudible], what you’re talking about is when you simply, in a calculated way, refuse to do anything for well over a year … [inaudible] … and [stuttering] I, I, the policy I think here is ethnic cleansing by inaction.

"It’s not ethnic cleansing in the sense that they’re killing people or [driving] people out, but what we need to recognize here is that, they’re in this happy position for them, where the federal government does nothing, as they become richer and richer, because well not only black people needed housing assistance, but they were [predominantly poor, who did it], to simply not do anything to alleviate this housing crisis which … was being exacerbated by Katrina … [inaudible] they, they, they let the hurricane do the ethnic cleansing, because then they’re, all they’re doing is not resisting it, that’s why I call ethnic cleansing by inaction, and I know that there are people who were very happy that, as a result, … [inaudible] … [so that] Louisiana would become a more widely Republican [city] … [inaudible] … because if you lose 100,000 black voters … then you have to take a state that was prodominately Republican and made it [inaudible]."

The video is here, but it's even more throughly incoherent.


Tax Shelter said...

Compare Jobs to Ballmer, what a contrast. No wonder Apple products are so much cooler compared to products from Microsoft.

The Owner said...

All the fearful talk about the so-called Religious Right is just like all the worrying over global warming... it's a small, terrified minority of the left who is so filled with hate for their fellow human beings that they'd rather spend their time trying to convince everyone the ghosts they see are real rather than just quietly living out their annoying lives away from everyone that bothers them.

Religious Right my ass! Apparently these people aren't sending any of their kids off to college, there's less faith on your average college campus than there was on the earth before humans arrived.