I think not only are the prices of houses too high but the township property tax is rapacious. Are the high property taxes justified or should people be taking township officials to task on this?
Gareth,don't worry about WaMu Bonuses,they have decided not to take Mortgage losses into account when determining "performance" bonuses for the top 100 executives.Who needs Viagra when you got batteries?
Are the hedgies playing games this morning? I see someone buying 30-90 day futures at below market levels then see more purchases at above market levels a short time later.
Are the hedgies inducing volatility to make money on small moves up and down in the market?
"Are all analysts graduates of Pollyanna U, led by the distinguished Dr. Pangloss?"
When was the last time you opened a fortune cookie and the fortune read, "You are going to die." Which is, of course, true.
People who write fortunes like that don't work at the fortune cookie bakery too long. The analysts you see on TV and in the MSM are a product of the same dynamic.
I just found a paper that The Fed is probably looking at for solving this systemic meltdown; God willing, one can only pray that Warsh is somewhere out there:
In mathematics, a pseudometric space is a generalized metric space in which the distance between two distinct points can be zero. In the same way as every normed space is a metric space, every seminormed space is a pseudometric space. Because of this analogy the term semimetric space (which has a different meaning in topology) is sometimes used as a synonym, especially in functional analysis.
we have a lot of pop Freudians out there explaining U.S. politics in terms of 43 and 41. Maybe it's time for some pop Jungians to surface. It almost seems like there is a collective consciousness among the people of decide, analyze and comment on economic and financial policy, and collectively, at any one point, they can only absorb so much forecast, or accept so much new information. It's okay to be a little out of consensus (especially if you turn out to be slightly closer to the mark than the middle of the pack), but the outlier will be discarded.
What I find interesting about comments like the one CR has posted is that (like most of the quotes posted on this site recently), they suggest that the collective consciousness is shifting.
What if there is not a bottom or top? I think we see that here in the following example from NAR:
In mathematics, subadditivity is a property of a function that states, roughly, that evaluating the function for the sum of two elements of the domain always returns something less than or equal to the sum of the function's values at each element. There are numerous examples of subadditive functions in various areas of mathematics, particularly norms and square roots. Additive functions are special cases of subadditive functions.
I made a prediction 6 months ago. Threshold is 71.5. for the dollar before the Fireworks begin. Not in celebration. New terrorist campaign will emerge. Those who are transferring out of USD will be punished...just a thought of course...
Of course the collective consciousness is shifting. Many studies have shown the most important determinant of human decision making is what other people are doing. Students in a room that starts to smoke will sit there motionless until the first few people get up. People wait to cross against a light until a well-dressed person does it first. Passersby will not interfere in a crime, not even to call the police, unless somebody else does it first.
These are well known.
So, if you work at predicting economic or housing market performance, the water cooler chat and office conventional wisdom are far more important than any data.
As a corollary, if this blog is long-lived, the day will come when we are all out buying houses like candy while the rest of the world calls us nuts.
WASHINGTON (MarketWatch) - The net worth of U.S. households fell by $533 billion, or a 3.6% annual rate, in the fourth quarter of 2007, the first time total wealth had fallen since late 2002, the Federal Reserve reported Thursday. For all of 2007, household net worth rose 3.4% to $57.7 trillion, the slowest growth in five years. After the effects of inflation are included, real net worth fell for the year. Household borrowing rose at a 5.6% annual rate, less than half the debt growth seen during the credit boom years in 2003 through 2005.
Here part of another paper recently published in association with someone related to NAR which suggests that the housing bubble was not a bubble but a part of another more dynamic cyclical system which was off the globalized radar screens. This is obviously why everyone was unaware of the reality of the housing bubble and all the synthetic derivatives which are now involved in what amounts to entropy, i.e, the synthetic fuel used to measure the growth of the economy in terms of falsified debt is now related to the unavailability of that systems energy to do future work. An example can be found in your glass of cola drink, where the ice cube melts and can not remain unchanged: Energy has spontaneously become more dispersed and spread out in that "universe" than when the glass of ice water was introduced and became a "system" within it.
From NAR: Almost periodicity is a property of dynamical systems that appear to retrace their paths through phase space, but not exactly. An example would be a planetary system, with planets in orbits moving with periods that are not commensurable (i.e., with a period vector that is not proportional to a vector of integers). A theorem of Kronecker from diophantine approximation can be used to show that any particular configuration that occurs once, will recur to within any specified accuracy: if we wait long enough we can observe the planets all return to within a second of arc to the positions they once were in.
This is obviously why everyone was unaware of the reality of the housing bubble and all the synthetic derivatives which are now involved in what amounts to entropy...
Look. I'm a single gal who doesn't have enough money to play any markets or make any investments or speculate in houses or even buy a new one. I got one credit card and I pay it off every month.
And I've been watching all this buying frenzy for a decade.
In regard to Mr. Warsh, it is of interest that he is such an expert on the following Ambac, MBIA related bond insurance matters, etc. Is it not nice to now America has been and remains in the hands of such cutting edge leaders?
He advised the President and senior administration officials on issues related to the U.S. economy, particularly fund flows in the capital markets, securities, banking, and insurance issues. Mr. Warsh participated in the Presidents Working Group on Financial Markets and served as the administrations chief liaison to the independent financial regulatory agencies.
Based on his experiences with NASA's management and engineers, Feynman concluded that the serious deficiencies in NASA management's scientific understanding, the lack of communication between the two camps, and the gross misrepresentation of the shuttle's dangers required that NASA take a hiatus from shuttle launches until it could resolve its internal inconsistencies and present an honest picture of the shuttle's reliability. Feynman soon found that, while he respected the intellects of his fellow Commission members, they universally finished their criticisms of NASA with clear affirmations that the Challenger disaster should be addressed by NASA internally, but that there was no need for NASA to suspend its operations or to receive less funding. Feynman felt that the Commission's conclusions were not compatible with its findings, and could not in good conscience recommend that such a deeply flawed organization should continue without a suspension of operations and a major overhaul. His fellow commission members were alarmed by Feynman's dissension, and it was only after much petitioning that Feynman's minority report was included at all: as an appendix to the official document.
Re: ... weak housing market will now be a longer cycle
See above: if we wait long enough we can observe the planets all return to within a second of arc to the positions they once were in.
This may take many moons, but someday, we will have another housing bubble which will be unregulated and we will have a political party that will allow for collusion to result in chaos (again).
If the Fed is designed to handle leverage, will it also handle leverage of leverage?
First question: "Leverage of leverage" is plain vanilla second-derivative stuff, like speed -> velocity -> acceleration. Anyone with a bachelor's in mathematics knows how it works, and that by the time whatever you're measuring turns down, its second derivative has already probably been hugely negative for a while.
The problem is, most of the people who understood the more arcane elements of the math didn't want to spill the beans, because they were all making seven figures working as quants for these selfsame investment banks and hedge funds.
"Maybe it's time for some pop Jungians to surface. "
Interesting point. Aside from the collective unconscious, there's also the concept of the Jungian shadow, the dark side. Like, if you refuse to acknowledge your dark side, it finds some way of popping out. Like the perfect preacher, beloved by all, who goes home and emotionally or physcially abuses his family because of some imaginary failings on their part.
Seen that way, what's the repressed "dark side" of the American economy, the thing that no one wants to face?
Just sitting down looking at the stuff from the kid's school backpack, and this struck me at a very micro-econ level. It's the new language on the school lunch menu, advising parents...
"Elementary students paying cash daily or have exhausted their lunch ticket will be permitted to charge no more than 5 lunches. Charged lunches should be paid for the next school day. When students have reached 3 charged lunches,m a warning envelope will be sent nome advisiing the parent of the charged meals. In the event when a student has accumulated 5 charged lunches and doesn't have money for lunch, a modified lunch consisting of fruit, crackers and milk will be provided to the student. Meals will always be provided to K-3 students or any disabled student as per federal regulation. Students will not be permitted to purchase ala carte items when they have a negative balance for charged lunches. Secondary students are not permitted to charge lunches."
Hold on to your panties this week as we ride on the Bush Ownership Society Freight Train (BOSFT) that has no brakes. Thank goodness we have a tsunami of cheap and easy liquidity synthetic derivatives stuffed in the boxcars to help us gain that extra momentum!
Everyone aboard and strap on your favorite phallus-shaped pegs!
homedad43: Farm imput cost are causing widespread problems throughout the food chain, expect shortages of pork, chicken, steak etc in the coming year. Asia which relies on pork is in a world of hurt with the high grain prices. Americans are so disconnected from their food source that they have no idea what is occuring.
Full fathom five thy father lies:
Of his bones are coral made;
Those are pearls that were his eyes:
Nothing of him that doth fade,
But doth suffer a sea-change
Into something rich and strange.
Sea-nymphs hourly ring his knell:
Hark! now I hear them,
Ding, dong, bell.
At 8 am Eastern Time, Boston Federal Reserve Bank President Eric Rosengren is scheduled to speak at an economic breakfast in Boston. Rosengren will add his voice to a chorus of Fed speakers lately, as the central bank prepares for its next interest rate announcement on March 18.
New York Federal Reserve Bank President Timothy Geithner will also give comments on Thursday, with his remarks set to begin at 1 pm Eastern Time. Geithner, a voting member of the Fed's policy-setting committee, is set to speak about the regulatory implications stemming from the financial challenges that have surfaced recently. Geithner will make his appearance before the Council on Foreign Relations, in New York.
In the evening, St. Louis Federal Reserve Bank President William Poole is due to speak. His remarks are scheduled to begin at 8 pm Eastern Time. Poole, who will appear at the Univ. of Illinois-Springfield, will speak about finance.
A large amount of information and commentary has come out of the Federal Reserve in recent days. This includes the central bank's Beige Book on Wednesday, a compilation of anecdotal economic information, and comments by Fed Chairman Bernanke on Friday.
interesting that while gold zoomed relative to dollar 35% appreciation, less so relative to oil 5% (approx)
"The Standard & Poor's 500 Index is down 9.7 percent since Sept. 18, when the Fed began cutting the fed funds target to 3 percent from 5.25 percent. The dollar has lost 9.2 percent of its value versus the euro, crude oil futures gained more than 29 percent and gold added 34 percent during that time.
Further interest-rate cuts may spur inflation and reduce the value of 10- and 30-year Treasuries, Faber said, calling the bonds ``a disaster waiting to happen.'' Ten-year notes fell to a four-year low of 3.44 on Jan. 22.
Eric Rosengren, head of the Federal Reserve Bank of Boston, said this morning that fundamental changes may be needed to the Wall Street ratings system that gave investors the confidence that mortgages were safe investments.
The conclusion?
"Maybe we shouldn't use the same ratings system for each of these different kinds of securities," Rosengren said.
mook:
good analogy of leverage on leverage
(position:velocity:acceleration)
I've struggeled to convey the problems with second derivative math to my friends/family for a long time... specifically why it's important if the US still experiences growth if the rate of growth is changing...
now I can use your analogy... don't worry I'll try to footnote you!
It was 16.25 about a week ago, which implies that the yield is going down, while the price remains over-valued by at least 4% for fair value. IMHO, if The Fed's main objective is to prop up Wall Street, we will see continued synthetic support of market prices, while earnings yields decrease in real terms relative to crashing bond yields. Price can be manipulated, but an index basket of corporations have to react to slower growth and declining earnings which result in lower yields.
There is an assumption that all the bad news should be placed on the table ASAP to help control this systemic crash, but The Fed is obviously not willing to step up to the table with truth or honesty, or regulation, or enforcement, or using The DOJ to take actions for fraud and false and misleading information -- instead we have a Fed more than willing to help bail out banker friends and to protect The Ownership Society fraud!
Relying on Junior Warsh to bullshit high school kids about his role in nepotism and his inefficiency in regard to the realtime American economy, will only put off the impending crash from this runaway freight train!
Do we have anyone from West Point or The Air Academy that understands econoics? Where is help...this is Katrina and The Fed is FEMA!!!!!
``I consider it most probable that the U.S. economy will experience slow growth, and not outright recession, in coming quarters,'' Janet L. Yellen, president of the San Francisco Federal Reserve Bank, said in a Feb. 12 speech.
Consumers and businesses have all they need to make the economy grow, so long as their confidence holds, says Thomas Hoenig, Federal Reserve Bank of Kansas City president.
Hoenig acknowledged Wednesday that the economys slowdown late last year had continued into this year. He also noted talk about the possibility of recession (Feb. 13, 2008).
Confidence plays a big part in that, he said. As long as people see the positives, theyll continue to move back into the market.
Among overlooked positives that Hoenig cited was the economys strong growth in 2007, though it slowed toward the end of the year. Consumer spending and employment have held up, he said, and businesses outside the financial industry remain profitable and able to invest.
``I consider it most probable that the U.S. economy will experience slow growth, and not outright recession, in coming quarters,'' Janet L. Yellen, president of the San Francisco Federal Reserve Bank, said in a Feb. 12 speech.
And this should surprise anyone? Equity markets may have predicted 17 of the last five recessions, but the Federal Reserve has predicted zero.
by the way leverage of leverage is easy to explain.
it's when your partner moves up while you move down assuming you are occupying first position with constant velocity right before acceleration leading to foreclosure.
by the way leverage of leverage is easy to explain.
it's when your partner moves up while you move down assuming you are occupying first position with constant velocity right before acceleration leading to foreclosure.
Americans are so disconnected from their food source that they have no idea what is occuring.
ron | Homepage | 03.06.08 - 12:56 pm
You are so correct.
Those in (semi) or rural areas are a bit more in touch. My milk is $2.80/gal from a local dairy, eggs come from a friend of my wife, spring/summer/fall veggies from a local farm and s/s/f fruits from a local orchard.
And before we moved from our old house, we looked at replacing the antique fireplace insert with one that burns corn. I couldn't philosophically bring myself to do that.
At this rate, next year's steak is presently snoring on the sofa after a brisk morning walk. God, I'm going to miss her.
Dateline March 5, 2008 3:00PM: Citigroup Sheds Some U.S. Branches.
Citigroup Inc. has started shedding clusters of U.S. bank branches in cities where the company has token presences that lag far behind larger players.
Citibank, the New York-based company's retail-banking unit, has agreed to sell its small network of branches in Amarillo, Texas, according to an internal bank memo sent Wednesday to Texas employees. Citigroup is selling the branches to a local lender, Happy State Bank, the memo said. The transaction's terms weren't disclosed....
One wonders if the buyer will remain in a "Happy State" after the purchase of CitiBank branches.
RE: Warsh...here's a snip of his bio from the Fed's website:
"From 1995 to 2002, Mr. Warsh was a member of the Mergers & Acquisitions Department of Morgan Stanley & Co., in New York, ultimately serving as Vice President and Executive Director. He served as financial adviser to numerous companies across a range of industry sectors, including manufacturing, basic materials, professional services, and high tech. In that capacity, Mr. Warsh helped structure capital markets transactions and facilitated fixed income and equity financings.
Mr. Warsh was born in April 1970 in Albany, New York. He received an A.B. in public policy (honors) from Stanford University in 1992 with significant course work in economics and statistics. Mr. Warsh went on to study law, economics, and regulatory policy at Harvard Law School and received a J.D. (cum laude) in 1995. He also completed course work in market economics and debt capital markets at Harvard Business School and MITs Sloan School of Management."
So to all the commenters here griping about Warsh's age or alleged political connections...sorry, you don't get cum laudes and honors degrees from these schools by being dumb or lazy, or by donations to schools by relatives. This guy is two years younger than I am and is a member of the FRB. I don't begrudge him that. Besides, what does the Constitution say the minimum age of the President is? That's right...35.
Now, this doesn't mean every decision this guy makes is going to be the correct one. But he is clearly not incompetent.
homedad43 writes:
Just sitting down looking at the stuff from the kid's school backpack, and this struck me at a very micro-econ level. It's the new language on the school lunch menu, advising parents...
What a story. This reminds me of the Menú economico from 1940s Argentina:
According to a 1945 presidential decree, all Argentine restaurants, even such famed luxury resorts as the grill rooms at the Plaza and the Alvear Palace Hotels in Buenos Aires, are required to list and serve the menú econímico. This 32¢ meal typically consists of uninspired soup, a snarl of spaghetti, nondescript fish and a tired banana.
To order such a meal, a customer has to have more crust than a Bowery mission pie. But some of the owners and waiters have worked out a defensive "treatment" for such diners. As soon as they hear the odious order, waiters snatch the tablecloth from the table and the napkin from the diner's lap. The table is set with chipped crockery and kitchen silverware. Then, aiming at the kitchen and rearing back, a waiter bellows at the top of his voice: "Menú econímico for one!"
A video of Josh White, telling an American version: One Meatball
I call the (new) bottom for real estate.
Until next week.
Are all analysts graduates of Pollyanna U, led by the distinguished Dr. Pangloss?
WAMU better pay our those executive bonuses fast.
Nice call S&P.
Now, about those AAA ratings for the monolines....
Cheers,
So when is this inflation going to change to deflation? I don't know whether to buy gold or sell it.
I think not only are the prices of houses too high but the township property tax is rapacious. Are the high property taxes justified or should people be taking township officials to task on this?
There are to many houses...not the war, that is ravaging the economy....thank you GWB....please take a bow.
Basically the Big Picture is that the huge run-up in house prices was through leverage.
That is, use $10,000 or $20,000, or even less, to "buy" a house for $400K or $500K.....
And then the securitizations being bought through leverage, to help leverage the lending.
Leverage of leverage.
Of course, there is an outcome.
Don't worry about WaMu exec's bonuses. They are safe. I heard they are not accounting for "sub-prime" losses in calculating the bonuses.
That made me twitch...
Gareth,don't worry about WaMu Bonuses,they have decided not to take Mortgage losses into account when determining "performance" bonuses for the top 100 executives.Who needs Viagra when you got batteries?
Sorry if this has already been posted today, but Yun is at it again. It being bottom calling and recovery predictions.
U.S. Jan pending home sales unchanged
Yahoo! 404 - Page Not Found
Best,
Are the hedgies playing games this morning? I see someone buying 30-90 day futures at below market levels then see more purchases at above market levels a short time later.
Are the hedgies inducing volatility to make money on small moves up and down in the market?
Intraday Futures Prices - Markets Data Center - WSJ.com
"Are all analysts graduates of Pollyanna U, led by the distinguished Dr. Pangloss?"
When was the last time you opened a fortune cookie and the fortune read, "You are going to die." Which is, of course, true.
People who write fortunes like that don't work at the fortune cookie bakery too long. The analysts you see on TV and in the MSM are a product of the same dynamic.
I just found a paper that The Fed is probably looking at for solving this systemic meltdown; God willing, one can only pray that Warsh is somewhere out there:
Pseudometric space - Wikipedia, the free encyclopedia
In mathematics, a pseudometric space is a generalized metric space in which the distance between two distinct points can be zero. In the same way as every normed space is a metric space, every seminormed space is a pseudometric space. Because of this analogy the term semimetric space (which has a different meaning in topology) is sometimes used as a synonym, especially in functional analysis.
we have a lot of pop Freudians out there explaining U.S. politics in terms of 43 and 41. Maybe it's time for some pop Jungians to surface. It almost seems like there is a collective consciousness among the people of decide, analyze and comment on economic and financial policy, and collectively, at any one point, they can only absorb so much forecast, or accept so much new information. It's okay to be a little out of consensus (especially if you turn out to be slightly closer to the mark than the middle of the pack), but the outlier will be discarded.
What I find interesting about comments like the one CR has posted is that (like most of the quotes posted on this site recently), they suggest that the collective consciousness is shifting.
Re: I call the (new) bottom for real estate.
What if there is not a bottom or top? I think we see that here in the following example from NAR:
In mathematics, subadditivity is a property of a function that states, roughly, that evaluating the function for the sum of two elements of the domain always returns something less than or equal to the sum of the function's values at each element. There are numerous examples of subadditive functions in various areas of mathematics, particularly norms and square roots. Additive functions are special cases of subadditive functions.
Americans poorer than a year ago.
Brother can you spare a dime?
Americans poorer than a year ago, Fed says - MarketWatch
I made a prediction 6 months ago. Threshold is 71.5. for the dollar before the Fireworks begin. Not in celebration. New terrorist campaign will emerge. Those who are transferring out of USD will be punished...just a thought of course...
Of course the collective consciousness is shifting. Many studies have shown the most important determinant of human decision making is what other people are doing. Students in a room that starts to smoke will sit there motionless until the first few people get up. People wait to cross against a light until a well-dressed person does it first. Passersby will not interfere in a crime, not even to call the police, unless somebody else does it first.
These are well known.
So, if you work at predicting economic or housing market performance, the water cooler chat and office conventional wisdom are far more important than any data.
As a corollary, if this blog is long-lived, the day will come when we are all out buying houses like candy while the rest of the world calls us nuts.
From MarketWatch:
WASHINGTON (MarketWatch) - The net worth of U.S. households fell by $533 billion, or a 3.6% annual rate, in the fourth quarter of 2007, the first time total wealth had fallen since late 2002, the Federal Reserve reported Thursday. For all of 2007, household net worth rose 3.4% to $57.7 trillion, the slowest growth in five years. After the effects of inflation are included, real net worth fell for the year. Household borrowing rose at a 5.6% annual rate, less than half the debt growth seen during the credit boom years in 2003 through 2005.
Leverage depends on confidence, and eventually unwinds.
What does leverage of leverage do?
If the Fed is designed to handle leverage, will it also handle leverage of leverage?
You should hear some of the things they're saying about the secondary mortgage market on CNBC right now. Clear state of panic. Wow.
Here part of another paper recently published in association with someone related to NAR which suggests that the housing bubble was not a bubble but a part of another more dynamic cyclical system which was off the globalized radar screens. This is obviously why everyone was unaware of the reality of the housing bubble and all the synthetic derivatives which are now involved in what amounts to entropy, i.e, the synthetic fuel used to measure the growth of the economy in terms of falsified debt is now related to the unavailability of that systems energy to do future work. An example can be found in your glass of cola drink, where the ice cube melts and can not remain unchanged: Energy has spontaneously become more dispersed and spread out in that "universe" than when the glass of ice water was introduced and became a "system" within it.
From NAR: Almost periodicity is a property of dynamical systems that appear to retrace their paths through phase space, but not exactly. An example would be a planetary system, with planets in orbits moving with periods that are not commensurable (i.e., with a period vector that is not proportional to a vector of integers). A theorem of Kronecker from diophantine approximation can be used to show that any particular configuration that occurs once, will recur to within any specified accuracy: if we wait long enough we can observe the planets all return to within a second of arc to the positions they once were in.
What does leverage of leverage do?
Imagine a bunch of horny male Pomeranians in a circle...
This is obviously why everyone was unaware of the reality of the housing bubble and all the synthetic derivatives which are now involved in what amounts to entropy...
Look. I'm a single gal who doesn't have enough money to play any markets or make any investments or speculate in houses or even buy a new one. I got one credit card and I pay it off every month.
And I've been watching all this buying frenzy for a decade.
And I knew sooner or later, you were all fucked.
Where's my Ph.D.?
In regard to Mr. Warsh, it is of interest that he is such an expert on the following Ambac, MBIA related bond insurance matters, etc. Is it not nice to now America has been and remains in the hands of such cutting edge leaders?
He advised the President and senior administration officials on issues related to the U.S. economy, particularly fund flows in the capital markets, securities, banking, and insurance issues. Mr. Warsh participated in the Presidents Working Group on Financial Markets and served as the administrations chief liaison to the independent financial regulatory agencies.
Is today Social Services day at CR?
Re: You were all fucked
Perhaps this is a better way to say that:
Based on his experiences with NASA's management and engineers, Feynman concluded that the serious deficiencies in NASA management's scientific understanding, the lack of communication between the two camps, and the gross misrepresentation of the shuttle's dangers required that NASA take a hiatus from shuttle launches until it could resolve its internal inconsistencies and present an honest picture of the shuttle's reliability. Feynman soon found that, while he respected the intellects of his fellow Commission members, they universally finished their criticisms of NASA with clear affirmations that the Challenger disaster should be addressed by NASA internally, but that there was no need for NASA to suspend its operations or to receive less funding. Feynman felt that the Commission's conclusions were not compatible with its findings, and could not in good conscience recommend that such a deeply flawed organization should continue without a suspension of operations and a major overhaul. His fellow commission members were alarmed by Feynman's dissension, and it was only after much petitioning that Feynman's minority report was included at all: as an appendix to the official document.
Re: ... weak housing market will now be a longer cycle
See above: if we wait long enough we can observe the planets all return to within a second of arc to the positions they once were in.
This may take many moons, but someday, we will have another housing bubble which will be unregulated and we will have a political party that will allow for collusion to result in chaos (again).
What does leverage of leverage do?
If the Fed is designed to handle leverage, will it also handle leverage of leverage?
First question: "Leverage of leverage" is plain vanilla second-derivative stuff, like speed -> velocity -> acceleration. Anyone with a bachelor's in mathematics knows how it works, and that by the time whatever you're measuring turns down, its second derivative has already probably been hugely negative for a while.
The problem is, most of the people who understood the more arcane elements of the math didn't want to spill the beans, because they were all making seven figures working as quants for these selfsame investment banks and hedge funds.
Second question: Umm, no.
And that should be "position -> velocity -> acceleration" up there, of course, not "speed." Speed is velocity. Ugh.
Home Equity Falls Below 50 Percent
Mal
You are sooooo on target. I like that!
Yun's bottom is a possibility - in sales. That would suggest prices have "only" 2 more years of steep declines ahead.
"Maybe it's time for some pop Jungians to surface. "
Interesting point. Aside from the collective unconscious, there's also the concept of the Jungian shadow, the dark side. Like, if you refuse to acknowledge your dark side, it finds some way of popping out. Like the perfect preacher, beloved by all, who goes home and emotionally or physcially abuses his family because of some imaginary failings on their part.
Seen that way, what's the repressed "dark side" of the American economy, the thing that no one wants to face?
mal is a chick. male bias, my mental images of posters here are almost universally male, or conjure bag.
tanta excluded.
Thanks, Markel. Damned fine question.
Just sitting down looking at the stuff from the kid's school backpack, and this struck me at a very micro-econ level. It's the new language on the school lunch menu, advising parents...
"Elementary students paying cash daily or have exhausted their lunch ticket will be permitted to charge no more than 5 lunches. Charged lunches should be paid for the next school day. When students have reached 3 charged lunches,m a warning envelope will be sent nome advisiing the parent of the charged meals. In the event when a student has accumulated 5 charged lunches and doesn't have money for lunch, a modified lunch consisting of fruit, crackers and milk will be provided to the student. Meals will always be provided to K-3 students or any disabled student as per federal regulation. Students will not be permitted to purchase ala carte items when they have a negative balance for charged lunches. Secondary students are not permitted to charge lunches."
So one more indication of where J6P is at.
Hold on to your panties this week as we ride on the Bush Ownership Society Freight Train (BOSFT) that has no brakes. Thank goodness we have a tsunami of cheap and easy liquidity synthetic derivatives stuffed in the boxcars to help us gain that extra momentum!
Everyone aboard and strap on your favorite phallus-shaped pegs!
homedad43: Farm imput cost are causing widespread problems throughout the food chain, expect shortages of pork, chicken, steak etc in the coming year. Asia which relies on pork is in a world of hurt with the high grain prices. Americans are so disconnected from their food source that they have no idea what is occuring.
Correct me if i'm wrong - but some form of leverage of leverage has been behind every major crash -> depression, hasn't it?
Mal
you are close to right...you said "you are all so f^$k&d"
close
should read we (WE) are all so f^$k&d
kuz know what hommie...its a large hood and weez all innit
A Sea Dirge
by William Shakespeare
Full fathom five thy father lies:
Of his bones are coral made;
Those are pearls that were his eyes:
Nothing of him that doth fade,
But doth suffer a sea-change
Into something rich and strange.
Sea-nymphs hourly ring his knell:
Hark! now I hear them,
Ding, dong, bell.
This meltdown goes beyond velocity and acceleration.
Get used to jerk .
Third derivative of position
For whom the bell doth toll:
At 8 am Eastern Time, Boston Federal Reserve Bank President Eric Rosengren is scheduled to speak at an economic breakfast in Boston. Rosengren will add his voice to a chorus of Fed speakers lately, as the central bank prepares for its next interest rate announcement on March 18.
New York Federal Reserve Bank President Timothy Geithner will also give comments on Thursday, with his remarks set to begin at 1 pm Eastern Time. Geithner, a voting member of the Fed's policy-setting committee, is set to speak about the regulatory implications stemming from the financial challenges that have surfaced recently. Geithner will make his appearance before the Council on Foreign Relations, in New York.
In the evening, St. Louis Federal Reserve Bank President William Poole is due to speak. His remarks are scheduled to begin at 8 pm Eastern Time. Poole, who will appear at the Univ. of Illinois-Springfield, will speak about finance.
A large amount of information and commentary has come out of the Federal Reserve in recent days. This includes the central bank's Beige Book on Wednesday, a compilation of anecdotal economic information, and comments by Fed Chairman Bernanke on Friday.
interview with Faber at Bloomberg.
the gist...the dollar is toast.
interesting that while gold zoomed relative to dollar 35% appreciation, less so relative to oil 5% (approx)
"The Standard & Poor's 500 Index is down 9.7 percent since Sept. 18, when the Fed began cutting the fed funds target to 3 percent from 5.25 percent. The dollar has lost 9.2 percent of its value versus the euro, crude oil futures gained more than 29 percent and gold added 34 percent during that time.
Further interest-rate cuts may spur inflation and reduce the value of 10- and 30-year Treasuries, Faber said, calling the bonds ``a disaster waiting to happen.'' Ten-year notes fell to a four-year low of 3.44 on Jan. 22.
Bernanke Policy to `Destroy' U.S. Dollar, Faber Says (Update1) - Bloomberg.com
Eric Rosengren, head of the Federal Reserve Bank of Boston, said this morning that fundamental changes may be needed to the Wall Street ratings system that gave investors the confidence that mortgages were safe investments.
The conclusion?
"Maybe we shouldn't use the same ratings system for each of these different kinds of securities," Rosengren said.
After position, velocity, and acceleration we have jerk, one of the better derivatives.
After position, velocity, and acceleration we have jerk, one of the better derivatives.
I can see it now: "Yun: Jerk in Home Prices Stabilized Last Month"
The added bonus being that the first two words of the title would stand alone.
mook:
good analogy of leverage on leverage
(position:velocity:acceleration)
I've struggeled to convey the problems with second derivative math to my friends/family for a long time... specifically why it's important if the US still experiences growth if the rate of growth is changing...
now I can use your analogy... don't worry I'll try to footnote you!
Thanks!
mal is a chick. male bias, my mental images of posters here are almost universally male, or conjure bag.
Selection bias. More true for stock market news. Think LawyerLiz, Ellen, donna, Robyn, MoM, etc.
"Speed is velocity. Ugh."
Mook | 03.06.08 - 12:42 pm | #
Uh, no. Not quite. Speed is a scalar quantity:
---------->
whereas velocity is a vector quantity:
---------->
|..*
|....*
|......*
|........*
/........./
having both speed and direction.
S&P P/E going up as I predicted.
P/E: @ 16.70
It was 16.25 about a week ago, which implies that the yield is going down, while the price remains over-valued by at least 4% for fair value. IMHO, if The Fed's main objective is to prop up Wall Street, we will see continued synthetic support of market prices, while earnings yields decrease in real terms relative to crashing bond yields. Price can be manipulated, but an index basket of corporations have to react to slower growth and declining earnings which result in lower yields.
There is an assumption that all the bad news should be placed on the table ASAP to help control this systemic crash, but The Fed is obviously not willing to step up to the table with truth or honesty, or regulation, or enforcement, or using The DOJ to take actions for fraud and false and misleading information -- instead we have a Fed more than willing to help bail out banker friends and to protect The Ownership Society fraud!
Relying on Junior Warsh to bullshit high school kids about his role in nepotism and his inefficiency in regard to the realtime American economy, will only put off the impending crash from this runaway freight train!
Do we have anyone from West Point or The Air Academy that understands econoics? Where is help...this is Katrina and The Fed is FEMA!!!!!
SOS!!!
Slow Growth
``I consider it most probable that the U.S. economy will experience slow growth, and not outright recession, in coming quarters,'' Janet L. Yellen, president of the San Francisco Federal Reserve Bank, said in a Feb. 12 speech.
Consumers and businesses have all they need to make the economy grow, so long as their confidence holds, says Thomas Hoenig, Federal Reserve Bank of Kansas City president.
Hoenig acknowledged Wednesday that the economys slowdown late last year had continued into this year. He also noted talk about the possibility of recession (Feb. 13, 2008).
Confidence plays a big part in that, he said. As long as people see the positives, theyll continue to move back into the market.
Among overlooked positives that Hoenig cited was the economys strong growth in 2007, though it slowed toward the end of the year. Consumer spending and employment have held up, he said, and businesses outside the financial industry remain profitable and able to invest.
``I consider it most probable that the U.S. economy will experience slow growth, and not outright recession, in coming quarters,'' Janet L. Yellen, president of the San Francisco Federal Reserve Bank, said in a Feb. 12 speech.
And this should surprise anyone? Equity markets may have predicted 17 of the last five recessions, but the Federal Reserve has predicted zero.
all this talk about
position
velocity
acceleration
and
jerk
belongs on another website
by the way leverage of leverage is easy to explain.
it's when your partner moves up while you move down assuming you are occupying first position with constant velocity right before acceleration leading to foreclosure.
all this talk about
position
velocity
acceleration
and
jerk
belongs on another website
by the way leverage of leverage is easy to explain.
it's when your partner moves up while you move down assuming you are occupying first position with constant velocity right before acceleration leading to foreclosure.
sorry for the double...i swear i didn't do it
"system error please try page later"
thanks haloSca
Americans are so disconnected from their food source that they have no idea what is occuring.
ron | Homepage | 03.06.08 - 12:56 pm
You are so correct.
Those in (semi) or rural areas are a bit more in touch. My milk is $2.80/gal from a local dairy, eggs come from a friend of my wife, spring/summer/fall veggies from a local farm and s/s/f fruits from a local orchard.
And before we moved from our old house, we looked at replacing the antique fireplace insert with one that burns corn. I couldn't philosophically bring myself to do that.
At this rate, next year's steak is presently snoring on the sofa after a brisk morning walk. God, I'm going to miss her.
Way off topic ....
Dateline March 5, 2008 3:00PM: Citigroup Sheds Some U.S. Branches.
Citigroup Inc. has started shedding clusters of U.S. bank branches in cities where the company has token presences that lag far behind larger players.
Citibank, the New York-based company's retail-banking unit, has agreed to sell its small network of branches in Amarillo, Texas, according to an internal bank memo sent Wednesday to Texas employees. Citigroup is selling the branches to a local lender, Happy State Bank, the memo said. The transaction's terms weren't disclosed....
One wonders if the buyer will remain in a "Happy State" after the purchase of CitiBank branches.
-- Hiding Out
Selection bias. More true for stock market news. Think LawyerLiz, Ellen, donna, Robyn, MoM, etc.
sdtfs | 03.06.08 - 1:18 pm | #
True. To be more clear, I meant all gender neutral handles. I assume MoM et al to be women because of their names.
Who does Walsh interact with that gives him a clue about reality?
Never mind that a 35 y.o. male is still drunk enough with his own power and possibility that he can't help but f*** things up.
Nuf Said.
Faber doesn't understand that the U$S is backed by 6K nuclear weapons.
It will become clear once the crooks of Wall Street and the entitlement leeches are permanently on the sidelines.
RE: Warsh...here's a snip of his bio from the Fed's website:
"From 1995 to 2002, Mr. Warsh was a member of the Mergers & Acquisitions Department of Morgan Stanley & Co., in New York, ultimately serving as Vice President and Executive Director. He served as financial adviser to numerous companies across a range of industry sectors, including manufacturing, basic materials, professional services, and high tech. In that capacity, Mr. Warsh helped structure capital markets transactions and facilitated fixed income and equity financings.
Mr. Warsh was born in April 1970 in Albany, New York. He received an A.B. in public policy (honors) from Stanford University in 1992 with significant course work in economics and statistics. Mr. Warsh went on to study law, economics, and regulatory policy at Harvard Law School and received a J.D. (cum laude) in 1995. He also completed course work in market economics and debt capital markets at Harvard Business School and MITs Sloan School of Management."
So to all the commenters here griping about Warsh's age or alleged political connections...sorry, you don't get cum laudes and honors degrees from these schools by being dumb or lazy, or by donations to schools by relatives. This guy is two years younger than I am and is a member of the FRB. I don't begrudge him that. Besides, what does the Constitution say the minimum age of the President is? That's right...35.
Now, this doesn't mean every decision this guy makes is going to be the correct one. But he is clearly not incompetent.
Lets see, everyone thinks gold is going up to $1600. That means you should probably sell gold.
Sell oil. 12 months from now, I guarantee that commodity prices will be at least 20% lower than they are now.
Lets see, everyone thinks gold is going up to $1600. That means you should probably sell gold.
Spoken like a true naif.
What a story. This reminds me of the Menú economico from 1940s Argentina:
A video of Josh White, telling an American version:
One Meatball