Political Economy category archive

Writing as “Spengler” at Asia Times, David P. Goldman is gloomy. A nugget:

The so-called American economic recovery won’t die, because it’s undead. It was a zombie to begin with. Equity investors during the past six weeks came to the collective conclusion that the US is not in the early phase of an economic recovery, but in the endless middle of a structural slump, in the term of Nobel Prize winner Edmund Phelps.

Read the whole thing, then go have a drink. Or four.

Foreclosures are just fine, thank you, Country Wide and Ameriquest:

In May, 1,145 homes sold in South Hampton Roads, Real Estate Information Network Inc. reported Thursday. That’s up 25.4 percent from April but down nearly 4 percent from a year ago.

Meanwhile, the median price of homes sold last month dipped to $189,000, down 11.1 percent from May 2010, the Virginia Beach-based multiple listing service reported.

Nearly one of every three homes sold in May – 31 percent – were in foreclosure or sold for less than what the homeowner owed, according to the report. That’s up from 21 percent a year ago.

Via Bob Cesca.

No doubt throwing more persons out of work austerity will fix this:

Jobless claims increased by 1,000 to 427,000 in the week ended June 4, Labor Department figures showed today in Washington. Economists surveyed by Bloomberg News projected a drop in claims to 419,000, according to the median forecast. The number of people on unemployment benefit rolls and those receiving extended payments decreased.

Strong indicators for continued foreclosures:

The number of local (southeastern Virginia–ed.) home-owners who were “underwater” on their loans rose slightly to 80,150 at the end of March, according to CoreLogic, a Santa Ana, Calif.-based company that tracks mortgages nationwide. The number is up less than 1 percent from the roughly 79,500 who were underwater at the end of December.

The firm’s quarterly report said 22,967 more mortgages in the region will be underwater if home prices decline 5 percent from current levels.

Economists and real estate experts say that owing more on a home than it is worth is one of the most common precursors to foreclosure.

As Duncan frequently points out, our Galtian overlords have broken the economy and are not bothering to put it back together.

Rather, they’re off looking for the next bubblelicious con.

Still above 400k:

Jobless claims fell by 6,000 to 422,000 in the week ended May 28, Labor Department figures showed today in Washington. Economists surveyed by Bloomberg News projected a drop in claims to 417,000, according to the median forecast. The number of people on unemployment benefit rolls and those receiving extended payments decreased.

Bloomberg put “less that forecast in its headline.”*

Less than whose forecast? one might ask.

Why, Bloomberg’s, of course.

This says nothing about unemployment, but something about forecasters.

__________________________

*As it that actually meant anything to anyone other than bookies.

Not good.

Bloomberg:

Jobless claims increased by 10,000 to 424,000 in the week ended May 21, Labor Department figures showed today in Washington. The median estimate of economists in a Bloomberg News survey called for a drop to 404,000. The economy grew less than forecast in the first quarter, a separate report showed.

(snip)

The Labor Department revised the prior week’s figure up to 414,000 from the 409,000 initially reported. There were no special factors behind last week’s increase, a Labor Department official said as the figures were released.

It’s a Republican thing.

One more time, pay attention to what they do, not to what they say.

Via TPM, which remarks:

The Center on Budget and Policy Priorities has updated and refined a widely cited chart, laying out the origins of the country’s current fiscal trajectory. And as before, the lion’s share of the problem comes from ongoing George W. Bush-era policies — particularly deficit-financed tax cuts, which eliminated Clinton-era surpluses and left the Treasury poised for a huge hit when the financial crisis and economic downturn further eroded federal revenues.

A little better, but this over 400k.

Jobless claims declined by 29,000 to 409,000 in the week ended May 14, Labor Department figures showed today in Washington. The median estimate of economists in a Bloomberg News survey called for a drop to 420,000. The number of applications were the lowest in a month.

Declining firings and gains in hiring are helping sustain consumer spending, which accounts for about 70 percent of the economy, even as food and fuel costs increase. While payrolls have climbed for seven consecutive months, a jobless rate close to 9 percent underscores the need for a pickup in employment that will spur growth.

“There should be unlimited corporate money, and I want some of it.”

Via TPM.

Still not good:

Applications for jobless benefits decreased 44,000 in the week ended May 7 to 434,000, Labor Department figures showed today. Economists forecast 430,000 claims, according to the median estimate in a Bloomberg News survey. The number of people on unemployment benefit rolls rose, while those getting extended payments decreased.

A further decline in the number of firings accompanied by job gains elsewhere may shore up consumers’ confidence and boost average incomes, helping Americans overcome the strains of higher food and energy costs. U.S. payrolls have expanded for seven straight months, a sign the labor market is strengthening.

Atrios, over at Eschaton, frequently remarks how zoning and development practices militate against friendly, welcoming, walkable public spaces–parks, boulevards, shopping districts, and the like.

I live in just such an area.

Where I live was developed around a golf course over the course of two decades or so. (I live in one of several comparatively modest townhouse condo complexes scattered about the space.)

From the deepest depths, it takes over five minutes to drive to the entrance. It take 30-45 minutes to walk to the nearest bus stop, here in the largest city in Virginia. A round-trip drive to the nearest grocery store, less than half a mile from the entrance, to pick up that one item you need to finish a recipe, takes half an hour.

You can tell which areas developed first: The newer the houses, the bigger and uglier–and less welcoming looking–the design.

Lauren Sandler and Carlin Flora, in a piece analyzing the American Dream (marriage, suburbs, kids, cars), see parallels in the architecture of McMansions to the loss of public space that Atrios so frequently notes. They cite Andres Duany, coauthor of Suburban Nation: The Rise of Sprawl and the Decline of the American Dream. A nugget:

Today’s houses are “fully equipped to compensate and mitigate the loss of the public realm,” Duany says. Fifty years ago homes averaged 1,700 square feet. Now that figure is up to 2,700, and interior architecture, in Duany’s mind, exists to mimic an urban world where few Americans dwell today. The double-height entry hall is the surrogate of the town square; the media room supplants the theater; the master suite practically exists as its own townhouse. Multiple dining areas further service our separation from the outside world: The breakfast nook is the diner; the formal dining room is the special-occasion white-tablecloth restaurant; even the kitchen island functions like a European tabac. “If you had a public realm,” Duany says, “you wouldn’t have to buy more house.” Duany’s own work in the New Urbanist movement—planning walkable, mixed-use areas designed to recapture a sense of community—may be the best bet for a resurgence of the public realm. But even a semi-utopian like Duany has a hard time imagining how to reverse the course of American sprawl en masse.

Bad week in Black Rock:

Applications for jobless benefits jumped by 43,000 to 474,000 in the week ended April 30, the most since August, Labor Department figures showed today. A spring break holiday in New York, a new emergency benefits program in Oregon and auto shutdowns caused by the disaster in Japan were the main reasons for the surge, a Labor Department spokesman said as the data was released to the press.

Even before last week, claims had drifted up, raising concern the improvement in the labor market has stalled. Employers added 185,000 workers to payrolls in April, fewer than in the prior month, and the unemployment rate held at 8.8 percent, economists project a Labor Department report to show tomorrow.

Cutting taxes for the rich so they can store more money in the Cayman Islands is no doubt the best way to maintain this trend.

Iowa alleges the use of creative strategies to keep those foreclosures coming:

Bank of America Corp. (BAC) was accused by a top official at the Iowa attorney general’s office of engaging in a divide-and-conquer strategy by undermining support for the settlement of a nationwide probe into foreclosure practices, a person familiar with the matter said.

The bank tried to get attorneys general to break away from those supporting the proposed accord, Iowa Assistant Attorney General Patrick Madigan said during a recent conference call, according to the person. A second person familiar with the settlement talks said the bank sought to sow dissent among the states, eight of which have publicly criticized the proposal’s terms. Both people asked not to be identified because the talks are private. Madigan declined to comment.

Read the whole thing. Further down in the story is a report that it is Republican attorneys-general who are allowing themselves to be divided and conquered.

Republicans? Defer to the banksters?

On noes.

The regular Thursday roller coaster report.

Up again:

Jobless claims increased by 25,000 to 429,000 in the week ended April 23, the most since late January, Labor Department figures showed today in Washington. The government anticipates a drop in unadjusted applications during the Good Friday holiday week, something that didn’t happen this year, a Labor Department spokesman said.

The report also showed the number of people on unemployment benefit rolls and those receiving extended payments dropped, a sign the jobless rate may fall in coming months. Companies have been cautious about ramping up hiring until they see further signs the recovery is self-sustaining, one reason why Federal Reserve policy makers yesterday pledged to complete their asset- purchase plan by June and keep borrowing costs near zero.

The portion I emphasized underscores the hollowness of claims that giving companies more profits leads to more hiring.

They are just stuffing more money in their mattresses.

Foreclosure fashionistas:

A growing number of high-end homes are selling at a loss or facing repossession by lenders in Las Vegas, which already has the highest rate of foreclosure filings among large U.S. cities. The wave of defaults that began with subprime borrowers and the unemployed has spread to upscale homeowners who see no point of staying even if they can afford to.

In the 15 months through March, at least 25 houses in the Las Vegas area changed hands for more than $3 million, with at least seven doing so through foreclosure or by selling at a loss, according to the Greater Las Vegas Association of Realtors and Clark County property records. In 2009, 14 homes sold for more than that amount, with one trading at a loss.

Via BartBlog.