Monthly Archives: July 2013

US Rents Hit Record Highs As Homeownership Plunges To 18 Year Lows

"The raw homeownership rate of 65.0% was unchanged from last quarter and 0.4% lower than a year ago. And on a seasonally adjusted basis, the percentage of Americans who have a house declined from 65.2% to 65.1%: the lowest since 1995. Obviously the flipside to most 'children' in their mid-30s still living in their parents' basements is that those wishing to brave the New Normal world will have to spend a lot for rent. A record lot in fact: the median asking rent for US vacant housing units just hit an all time high of $735 per month. The pain is most acute for those renting in the Northeast, where the median rent soared by $65 to a record high of $961." Continue reading →

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Bill Bonner: How America’s Working Stiffs Got Stiffed

"The Party leadership is not infallible. Neither in China nor in the US. In both countries, the feds – looking out for themselves – make policy decisions that are disastrous for others. We have no idea what calamity the central planners will cause in China. But we can take a fair guess of what they will do to America. Broadly, China’s feds build too many factories, malls and apartments. America’s feds encouraged the opposite error – borrowing and spending too much for consumption purposes. China’s real wages doubled in the last 10 years… after doubling in the previous 10 years. That is why the Chinese feel so much better off. They ARE much better off." Continue reading →

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Peter Schiff: Buy Gold and Silver Now, Money Printing Until We Have A Currency Crisis & More

"Fed Chief Ben Bernanke is going to be replaced by the end of this year. CEO of Euro Pacific Precious Metals, Peter Schiff, speculates on his replacement by saying, 'If it's solely based on which Fed Chairman is the most bullish for gold and silver, I would say that would be Janet Yellen. No matter who's put in at the Fed, they are going to keep printing because that's all they can do.' Schiff warns, 'They're going to keep printing until we have a currency crisis . . . and that is the most bullish environment for gold. Don't wait for the crisis to buy because you are not going to like the price.'" Continue reading →

Continue ReadingPeter Schiff: Buy Gold and Silver Now, Money Printing Until We Have A Currency Crisis & More

The Debt Ceiling Battle Is Coming

"A working paper by economist James Hamilton, of UC San Diego, for the National Bureau of Economic Research indicates that the official federal debt, $16.7 trillion, is the tip of the iceberg. Currently, the feds are $86.8 trillion in debt, according to Hamilton. The Treasury department has been looting government pensions to hold the debt ceiling at bay. This can go on for another month or so until the battle in Congress begins again. Sunday, Treasury Secretary Jack Lew pre-empted the debt ceiling fight with a strike against the GOP on Meet the Press. Lew predictably blamed the debt ceiling for the S&P crash of summer 2011." Continue reading →

Continue ReadingThe Debt Ceiling Battle Is Coming

People Are Using Borrowed Money To Buy Stock Like It’s 2007 Or 1999

"Deutsche Bank has a monster note out on margin debt that has been making the rounds. The conclusion of the note is rather simple – today’s euphoric borrowing on margin to buy stocks is reminiscent of past bubbly equity market periods (see here for more). The note reviews commentary from the 1999 & 2007 periods and compares it to what’s being said today. So, are we in a 2007 or 2000 type environment? Yes. I would say we are given that the data is confirming the same sort of market trends and debt trends. But the question is what’s the trigger? The market is kind of like a Jenga set at this stage in the cycle." Continue reading →

Continue ReadingPeople Are Using Borrowed Money To Buy Stock Like It’s 2007 Or 1999

Federal Debt: Frozen for Two Months. A Miracle!

"How is is it that the official debt of the United States government has been frozen at $16,699,396,000,000.00 for over 70 days? The Secretary of the Treasury is not saying. He merely reports that this is the case. 'Trust me.' Congress is trusting him. The Media are trusting him. The voters are trusting him. How does the U.S. government deal with an annual deficit of at least $600 billion, yet the official, on-budget debt does not change for over two months? Inquiring minds want to know. Actually, they don’t want to know. This willingness to believe in miracles is part of the national pastime: 'kick the can.'" Continue reading →

Continue ReadingFederal Debt: Frozen for Two Months. A Miracle!

Bernanke Must Testify Under Oath

"In September 2008 the Federal Reserve Bank of New York, a privately owned entity, paid $182 million to buy 80% of the busted insurance firm AIG. Why would any privately owned company pay par value for the shares of a company that had only hours to live? That’s what the court wants to know. Why? Because — you’ll love this — the former CEO of the almost busted insurance company says he was cheated. The value of his stock was diluted. How? By all that money. All that money let an outside agency — the New York FED — buy 80% of his worthless shares. He wants payback. From whom? 'The U.S. government.'" Continue reading →

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Treasury’s Lew: Congress Needs to Pass Debt Limit

"Congress needs to raise the debt limit and take away the 'cloud of uncertainty' about the nation's ability to pay its bills, Treasury Secretary Jack Lew said. 'The fight over the debt limit in 2011 hurt the economy, even though, in the end, we saw an extension of the debt limit. We saw confidence fall, and it hurt the economy. Congress needs to do its job. It needs to finish its work on appropriation bills. It needs to pass a debt limit,' Lew said on NBC's Meet The Press. Senior lawmakers on Capitol Hill are trying to come up with must-do legislation to keep federal agencies running after Sept. 30 and prevent the possibility of a government shutdown." Continue reading →

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Chicago’s Cash-on-Hand Plunges

"Mayor Rahm Emanuel closed the books on 2012 with $33.4 million in unallocated cash on hand — down from $167 million the year before — while adding to the mountain of debt piled on Chicago taxpayers, year-end audits show, reports the Chicago Sun Times. Last week, Moody’s Investors ordered an unprecedented triple-drop in the city’s bond rating, citing Chicago’s 'very large and growing' pension liabilities, 'significant' debt service payments, 'unrelenting public safety demands'." Continue reading →

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