Political Economy category archive
Truth in Labelling: Straight Talk Dept. 0
But now from Candidate McCain. Josh Marshall parses when social security privatization privatizes with without being privatization.
Bushomonics 2
It cost me $64+ to fill up the tank of my little yellow truck today.
That was 16 gallons at $4.03 9/10s.
A while ago, when I first started this blog, I tracked gas prices at local gas stations. Prices were going up and down and up and down (I lost the category when I imported my database to the new server and haven’t taken the time to restore the categories for posts that are over two years old–and I’m probably not going to).
I’m not going to start tracking gas prices again. What made it fun then was that they went up and down and up and down.
Now they are just going up.
Wonder who helped Vice President Cheney formulate this wonderful energy policy?
Gasoline prices are up almost $1 from a year ago, heaping pressure on a U.S. economy beleaguered by falling home values, a sagging dollar and an anemic job market. Oil prices have risen six-fold in the past six years and are up 40 percent since January.
British Lenders Learn from the Yanks 2
Upside down on the other side of the pond:
Falling house prices mean the amount borrowed could be greater than the value of their properties.
The data from the Council of Mortgage Lenders comes as figures show the housing market is slowing down further.
Separate housing figures suggest the number of transactions per estate agent has hit a 30-year low.
And there is no doubt it is highly likely that they took out these 100% mortgages because their estate agent or lender or both told them it was a good move to make.
This credit crunch or whatever you want to call it is worldwide and long-term.
“Move Along, Now. Nothing To See Here.” 0
Certainly no solutions. More on the ethanol scam:
But to the surprise of the industry and its supporters, the cost of making biodiesel has outpaced the rise in fossil-fuel prices.
Soybean oil, the main raw material for U.S. biodiesel, nearly doubled in price — partly because the consumption of soy has risen globally, and partly because U.S. farmers have been switching land to more profitable corn crops, from which ethanol is made. Demand from biodiesel producers has also lifted prices, and other biodiesel crops such as canola and palm oil have quickly caught up in cost.
It now costs about $4.66 to buy enough soybean oil to make a gallon of the renewable fuel. After adding manufacturing expenses and subtracting a $1-per-gallon tax credit, a gallon of nearly pure biodiesel retails at local stations for close to $6.
Conventional diesel, meanwhile, currently sells for about $4.80 per gallon.
H/T Bill for the link.
Bushonomics 0
Failure to regulate, because the monied class is always right. Follow the link for the full release:
The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure. The percentage of loans in the foreclosure process was 2.47 percent at the end of the first quarter, an increase of 43 basis points from the fourth quarter of 2007 and 119 basis points from one year ago.
(snip)
The foreclosure start rate differed considerably by loan type. For example:
- • Prime fixed rate loan foreclosure starts increased 7 basis points to 0.29 percent over the previous quarter and prime ARM foreclosure starts increased 49 basis points to 1.55 percent.
- • Subprime fixed foreclosure starts increased 28 basis points to 1.80 percent and subprime ARM foreclosure starts increased 106 basis points to 6.35 percent.
- • FHA foreclosure starts decreased 4 basis points to 0.87 percent and VA foreclosure starts increased 11 basis points to 0.39 percent.
And Duncan expects that bank failures are next on the Bushonomics agenda.
Another One Bites the Dust 0
Bushonomics is sound policy. You can bank on it.
Or not.
The Federal Deposit Insurance Corp. was appointed as receiver of First Integrity National Association of Staples, which had $54.7 million in assets and $50.3 million in deposits as of March 31.
The FDIC said all the bank’s deposits will be assumed by First International Bank and Trust of Watford City, N.D. Its two offices will reopen Saturday as branches of First International. Depositors of First Integrity will continue to have full access to their deposits, the agency said.
Via Profiles Blog.
Bushonomics: “I Bought This Car because the Front Seats Turn into a Bed” Dept. 1
Trickle down turns to flushed down:
The Standard & Poor’s/Case Shiller composite index of 20 metropolitan areas released on Tuesday showed prices of previously owned homes fell 2.2 percent in March, deepening their year-on-year decline.
Separately, the Conference Board said its consumer confidence index slumped to 57.2 this month from 62.8 in April as rising gasoline costs and falling home prices made Americans increasingly nervous both about current conditions and the future.
In one positive sign, however, the Commerce Department said sales of newly constructed single-family homes rose in April for the first time in six months, while the inventory of unsold new homes declined for the 12th straight month. But the previous month’s decline was even steeper than first reported.
I wonder–I really do, because I’m too lazy to look it up tonight and I have to be out of here early tomorrow–how much the sales of newly constructed homes were affected by price cuts by the developers, where “from the low $290s” might have changed to “from the low $250s“?
Anyone care to do my work for me? (That means find some statistics, not opine some sadistics.)
Bushonomics: Sidebar Changes 4
I’ve added two sites to the sidebar to which I want to call your special attention:
Marketwatch, a service of the Wall Street Journal, and Bonddad. So far, I haven’t gotten the Bonddad RSS feed to work. but I’m going to keep at it.
Both of them are financial sites highly recommended by Ray, who has made and lost fortunes in the markets.
(By the way, Ray has promised to work on a post to explain to us what hedge funds are and how they work. I suspect most of us who keep hearing the term “hedge funds” don’t really know what it means; Ray does.)
On Marketwatch, I recommend checking the comments to the stories; the commenters there are only in it for the bucks (that is, they are concerned about what’s happening to the financial markets) and, consequently, bring a special perceptiveness about what’s happening in the financial markets as it relates to the economy as a whole.
Bonddad is a “chartist.” He posts and explains charts about what is happening in the economy.
Check them both out and batten down the hatches. The Bushonomics storm really hasn’t started yet.
Bushonomics 3
Up, up
“Almost every day we’re hitting a record,” said Catherine Rossi, spokeswoman for the American Automobile Association’s Mid-Atlantic chapter, which is tracking summer gas prices with a weekly report.
And away.
Bushonomics: The FDIC Prepares for the Bottom To Drop Out 0
Holloway quickly went back to work. ANB Financial N.A., a bank in Bentonville, Ark. with $2.1 billion in assets and $1.8 billion in customer deposits, was failing and an expert like Holloway was needed to value the assets and find a stronger institution to take them on.
“I was very excited about coming back,” Holloway said in an interview. “I’m now 57. There’s still a lot of life left and the juices are flowing again.”
On May 9, life for ANB ended when the FDIC and the Office of the Comptroller of the Currency, another bank regulator, announced that the lender was closing. . . .
Only three banks have failed so far in 2008. But that number is set to surge as the credit crunch slows economic growth and hammers some lenders that grew too fast during the recent real-estate boom, experts say.
Bushonomics 1
Making the rich richer and the poor poorer.
Must be nice to one of the five . . .
But the second source is the bigger story, and it is, of course, borrowing. As incomes stagnated for many yet consumption soared, we made up the difference with borrowing. Household debt, including mortgages, just about doubled in seven short years (2000-07), from $7.4 trillion to $14.4 trillion.
But not to be a working stiff . . .
For some, there is even a growing recognition that American consumers have been living too large, spending too fast, borrowing too much. Whether today’s circumstantial thriftiness gives rise to a more frugal culture remains to be seen, but some experts hope the current crisis will at least encourage more rational spending habits.
“In past years, we’ve seen people talking the talk, but now they’re walking the walk,” said Jack R. Nerad, executive market analyst for Kelley Blue Book Marketing Research.
It’s certainly achieving it for the time being. A study of middle-class Americans last month by the Pew Foundation found that more than half have had to reduce their spending in the past year. A quarter expect to have trouble paying bills. Within the course of the past year, heating oil has leapt more than 50 percent nationally, and gasoline is up 25 percent.
(snip)
In just a year, prices of many kitchen essentials have seen double-digit price spikes, including flour (18.3 percent), bread (14.1), eggs (30.5) and milk (13.5).
Bushonomics 0
Feed the rich:
The Pentagon did not have the proper documentation, including receipts, vouchers, signatures, invoices or other paperwork, for $7.8 billion that American and Iraqi contractors were paid for phones, folders, paint, blankets, Nissan trucks, laundry services and other items, according to a 69-page audit released to the House Committee on Oversight and Government Reform.
An earlier audit by the inspector general found deficiencies in accounting for $5.2 billion of U.S. payments to buy weapons, trucks, generators and other equipment for Iraq’s security forces. In addition, the Defense Department spent $1.8 billion of seized Iraqi assets with “absolutely no accountability,” according to Rep. Henry A. Waxman (D-Calif.), who chairs the oversight committee. The Pentagon also kept poor records on $135 million that it paid to its partners in the multinational military force in Iraq, auditors said.
That’s $15 billion.
Just as a little bit of a comparison, that would run Philadelphia for approximately four years.
And that’s not an accounting of the total wasted money. That’s just the wasted money that the Current Federal Administration lost track of.
Oh, yeah, and Republicans know how to run a business.
Bushonomics 0
Viewed from abroad:
The number of transactions during the month was 1% lower than in March to an annual rate of 4.89 million, said the National Association
(snip)
The national median existing-home price for all housing types was $202,300 in April, which is 8% below a year ago when the median was $219,900.
Analysts predicted further price falls to come as a result of the increasing backlog of unsold homes.
The NER said inventory rose 10.5% to 4.55 million homes.
Bushonomics 0
and
What’s more, some local stations now are charging more for customers who pay by credit card than they do for motorists paying cash.
Seven gas stations in the eight-county area posted prices of $4 or more for regular-grade yesterday, according to AAA Mid-Atlantic. All were on the Pennsylvania side of the Delaware River – two in Philadelphia, three in Conshohocken, and one each in Doylestown and Morrisville.
Not to mention
Heavy metal is driving the latest trend in art theft.
With the cost of copper and other metals skyrocketing, thieves around the world are targeting outdoor sculpture to sell as scrap.
Thus far, Philadelphia appears to have dodged the copper bullet. But not entirely.
In late January, the plaque from Henry Moore’s 1964 bronze sculpture Three-Way Piece Number 1: Points was discovered missing from Triangle Park at 16th Street and the Parkway.
The plaque, which had been embedded in the grass next to the sidewalk, has not been found. The 7-foot, 3-inch sculpture, owned and maintained by the Fairmount Park Art Association, is untouched.
Other cities have not been as lucky.
In Warrenton, Ore., a 51/2-foot bronze statue of Sacagawea, the Indian guide, and her husband, Jean-Baptiste Charbonneau, was stolen from Lewis and Clark National Historical Park in January.
Regarding the last item, the sister church of my church (being a Methodist, my pastor rides a circuit), a big old stone pile about two miles from here, had its 70-plus year old copper gutters stolen a couple of months ago. The thief was caught coming back with his shopping cart for more stuff, but the police said that chances of recovery were slim, since the gutters had probably been reduced to something unrecognizable within hours of the theft.
No Credit Where Credit Is Due 0
What Duncan calls the “Big Shitpile” continues to spread:
It warned borrowers that its new deals would be more expensive.
C&G said: “From close of business today, Monday May 19, we will be withdrawing and replacing our entire range of mortgage products. Most rates will increase by 0.25% following last week’s rise in the cost of funds.”
Meanwhile, back at home:
“For squatters, foreclosed homes like this are like a camp-ground with free camping,” says real-estate broker Marc Charney, a foreclosure specialist, as he enters the home in Brockton, Massachusetts, and shines a flash-light at a mattress where homeless people have been sleeping each night.
Squatting is on the rise across the United States as foreclosures surge, eviction notices mount and homes go unsold for months, complicating the worst U.S. housing slump in a quarter century and forcing real-estate brokers to enlist the help of law enforcement and courts to sell empty houses.
Bushonomics 0
The Philadelphia area was in the same boat, seeing grocery prices rise 1.2 percent from February to April. Unlike the national data, the Bureau of Labor Statistics studies regional inflation figures every two months.
The bad news is being felt in food categories most consumers know and love: bread, milk, butter – even coffee. They are staples people buy every week. The kinds consumers cannot help but notice are costing more.
Agricultural economist Annette Clauson said the uptick in prices in core food categories was feeding shoppers’ anxieties as they also shell out bigger bucks for other routine outlays that, not so long ago, seemed more affordable.
Meanwhile,
Nevada, Arizona, California and Florida were among the hardest hit states, with metropolitan areas in California and Florida accounting for nine of the top 10 areas with the highest rate of foreclosure, the company said.
Irvine, Calif.-based RealtyTrac monitors default notices, auction sale notices and bank repossessions.
One in every 519 U.S. households received a foreclosure filing in April. Foreclosure filings increased from a year earlier in all but eight states.
But don’t worry
The price was averaging $3.78 today in the five-county Philadelphia region and $3.62 in South Jersey.
At the national level, the average was $3.78.
The price of diesel also moved up several cents overnight.
Dick Cheney’s oil buddies are doing just fine.
Bubble (Updated) 0
This week, This American Life, in conjunction with NPR News, explored the mortgage crises.
It was a fascinating show, including interviews with mortgage brokers, bankers, salespersons, homeowners, and credit counselors, some of whom were rich beyond their dreams before they became broke beyond their means.
From the website:
You can go to the website to learn more–listening to this story of greed, of willful blindness, and of the belief that if it is making money it must be right faith in the invisible hand of the market is well worth your time.
(I am sorry, but I could not find an easy way to link to the show itself. There is a “full show” icon on the webpage, but it be that the show won’t be available for streaming until later in the week. But this was one of the best hours of radio I’ve heard in weeks, because it is real people talking about what they really did and how they, as customers, mortgage company employees and brokers, and bundlers, let themselves be sucked into the what Duncan calls the big shitpile.)
Addendum:
The show is now available from the website. Click the download link.
Bushonomics 2
The failed Republican stewardship of the government is leaving its stamp on the economy.
Unfortunately, it’s a food stamp (emphasis added).
These are, social-service advocates say, dire days for families already beset by climbing gas prices and declining wages.
At the kitchen table, the gas pump and the workplace, people are being squeezed and compelled to live their lives with less and less.
But food is the greatest worry.
“We have a crisis,” said Sydelle Zove, interim food-stamp campaign manager for the Greater Philadelphia Coalition Against Hunger.
“Meals are scarce,” said Susan Smith, a 44-year-old Chester woman with diminishing means. “I’m 5-foot-10 and weigh 130. I should weigh 150.
“I need some food.”
(snip)
All this has occurred as food prices in the Northeastern United States have risen 14 percent since 2002 and median wages in metropolitan Philadelphia (excluding New Jersey) have dropped 4 percent during the same period, said Mark Price, labor economist with the Keystone Research Center, a nonpartisan policy-development institute in Harrisburg.
Regarding the boldfaced portion: So much for the Republican lie of “trickle down economics.”