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Thursday, June 12, 2014

Shiny Happy Housing Surveys

Today we held our collective noses and sifted through CNBC, one of the most horridly biased pro-Wall Street sources of mis-information, rumor, conjecture and outright lie there is in mainstream financial news..

And we came upon this delightful little header:

'Americans finally feel better about economy: Survey'

It was written by someone with the appropriate name of we kid you not.. Steven Liesman as in "Lies, Man"

"After seven long years of sharp recession and tepid recovery, the CNBC All-America Economic Survey found some key measures of U.S. public opinion finally regained their precrisis levels.
~ Oh.. boy..  I'll drink to that..

Ninety-one percent of Americans now believe their home prices will either be stable or rise over the next year, the highest since March 2007. And for the first time in three years, Americans picked real estate ahead of gold as the best investment.

Respondents also said they will spend about as much on a summer vacation as they did before the recession, following a sharp drop during the financial crisis."

Articles like this remind us of the chorus to the Beatles song "Getting Better" off the Sargeant Pepper's album where Paul McCartney sings, "You got to believe its getting better..  A little better all the time.." 

And John Lennon chimes with "It couldn't get much worse.."
Of course there's positivity..   Its how Americans are behaviorally conditioned...

"The sun's going to shine.. Tomorrow..  You can bet your bottom dollar that... Tomorrow...  There will be sun.."  -- from the musical 'Annie' of course...

Eternal optimism is adorable in a small child and gets one through truly difficult times like a sick loved one but otherwise without something Real and tangible to hang a hat on, its pathetic.

So let's quickly break down those three short paragraphs of BS..

Paragraph 1 -- 

There's been no recovery of any kind that hasn't been 100% manipulated by the government puppet masters pulling the strings so to declare there's been any kind of one even 'tepid' is a blatant lie by Liesman
~ My son is going to have a good future..  My leaders say so..

And let's look at it with logic and deductive reasoning..  All those people who felt confident about the housing market in 2006 and 07 and 08..  Did they turn out to be accurate or utter dum-dums?

So..  if those who felt confident pre-recession ended up showing their total ignorance to the true housing market and the dramatic price declines that were to soon follow, why should anyone put any stock in the current crop of morons who feel positive??

The IMF of all entities today warned of another impending global housing crisis because housing prices are spiking up too dramatically in some nations and parts of the US

Reuters:  "The world must act to contain the risk of another devastating housing crash, the International Monetary Fund warned on Wednesday, as it published new data showing house prices are well above their historical average in many countries.
~ I'm feeling lucky.. 

The warning from the IMF shows how an acceleration in global house prices from already high levels has emerged as one of the major threats to economic stability, with countries making limited progress in keeping them under control."

How many common everyday people who took that insipid biased survey understands the first thing about housing and economy beyond that they're hoping and wishing for?

Paragraph 2 -- 91% believe home prices will be stable or rise..   

OK, based on what, besides what we mentioned via the song lyrics i,e, 'Duh, well.. they gotta rise sometime, right?'

Renting is still on the upswing as more people just either can not get approval for or come up with the necessary out of pocket minimums of obtaining a mortgage, or prefer being mobile so they can re-location easier to job markets offering more opportunity than presently living..
The only home prices that have shown any increase in sales are those listed at $1mill and upwards and that's foreign investment money and well-to-do looking to avoid paying taxes in their home nation..

In January 2013, the fixed mortgage rate for 30yrs was 3.69%

Today its 4.20%..  and slowly, steadily rising..

Why the bleep would That instill confidence in a growing housing market?

Is the assumption because the stock market keep going up and up based on 100% financial manipulation that it will translate to homeowners getting their asking price?

And as gold is being purposely kept in check by the Fed since they do not want a commodity with a finite supply to usurp stocks as the #1 investment and the never-ending money printing machines, people don't know where to turn to make a buck..

Savings?  Nope..  Stocks?  God help the everyday person who gets in now..

So.. its home sales..  Its all people know..

Paragraph 3 -- This is where respondents say they will spend as much on summer vacation this year as pre-recession..

Complete Idiots..

Either too many people still have too much credit card credit available to them or for many its the 'last hurrah' before ultimate bankruptcy..
~ I'm going to Mexico..  Better paying jobs.. "Soy Alegre.."

You know the mindset..  If you owe $50k or $100k or $1 million and there's no way you'll ever be able to pay anything back and all open credit cards w available credit are taken from you when filing Chapter 7 anyways, then really what's the difference how much one declares to be in debt for?

Go to Disneyland.. Visit some amusement parks.. Lease a nice family SUV first (in a bankruptcy, you can not be forced to give up your vehicle since technically you do not 'own' it)  and just have some fun..

Later in the article, it mentions the reason for such blind optimism is expectation for increased wages

Once again.. Based on What?
~ Shh.. I am trying to be happy..

Did American corporations stop importing jobs abroad?   

Did they stop putting heavy emphasis on temp labor?  

Did the senior citizen workforce who are forced to stay working due to lost 401ks during the 2008 crash suddenly leave the job market??

Did employers decide they no longer were going to hire the cheapest labor possible and be Fair?!
~ I don't worry about drowning..   Someone will always come and save me..

There was a mention of being hopeful the $10.10 minimum wage would pass without the slightest bit of understanding that if you raise minimum wage 33%, everything else is going to be raised with it!!

In 2008 the average salary was just around $45k..  In 2014, its just around $47k, a percentage increase of 4.3% over a span of 6 years

In 2008, gasoline cost $1.87 in late November of that year..  Today it averages $3.73, a percentage increase of 100% over the same 6 years...

In 2008 the average movie ticket was $6.25..  Today its $10.25 an increase of over 33%
So if gas went up by 100% in 6 years and movie tickets went up 33%, then even if wages continue to rise, does anyone with half a brain think they will keep up in line with the costs of daily life??

Its really sad how Ignorant most people are..

Just blind faith and hope and optimism in Nothing real..

We'd love to give that writer Liesman and others like him a nice punch or three to the face for all their continual deceit but they have editors who tell them what to write and the slant...

And the average person desperately wants it all to be true..
So.. we'll try to cut them all some slack.. 

As the Nazis said at Nuremburg as their defense, those finance writers like Liesman who don't deeply believe their propaganda were simply "following orders" from higher ups..

There is absolutely no such thing as a trickle-down recovery!

The government has done absolutely nothing to alleviate the financial burden of most Americans to allow them the capital to become home buyers and will continue to only make minor tweaks..

If the government and banks, etc truly wanted people to have a chance to unload their housing debts and kickstart the housing markets they'd have done one or more of the following:
1)  All mortgages whether or not distressed or underwater, can be refinanced at a rate 50% less than the current locked in rate..   If you were paying 6% before, you now pay 3%, etc..

2)   A program called something like the 15% government credit..  

It would work something like this.. For a period of say 6 months, any house on the market with a mortgage that sells for X dollars, a buyer would only be responsible for 85% of that amount and the government pays the remaining 15% to the seller..

Example:  House is listed and sells for $250k..  The buyer is really paying $212.5k.. The government pays the seller the remaining $37.5k so the seller can get their true asking price..

The bank gets paid back its original mortgage and the government pretty much gets the money back through increased filings of capital gains tax by income tax filers..
3)  In addition to encourage the wealthy to buy more affordable homes or collect more tax revenue, the Government could add a 2% excise tax on the sale of all homes listed at $800k or more..

Just some ideas that would help the everyday person which means little to no chance in hell of ever being implemented..

We've said this before.. We'll say it again..

What's the different between a Republican and Democrat?
~ Can I re-take that survey please?

A Rep will walk to you and slap you across the face and not say a word..

A Dem will walk to you and slap you across the face then apologize and say you had a mosquito on your cheek..

Some like to be lied to.. Some prefer the 'honesty' of no words..

But ultimately its the same hard face slap...