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Keyword: bubble

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  • College: The Sixty-Five Thousand Dollar Misunderstanding

    04/17/2014 7:28:04 AM PDT · by SeekAndFind
    Pajamas Media ^ | 04/17/2014 | Roger L. Simon
    [1]Back in 1962, Robert Gover published a novel called the One Hundred Dollar Misunderstanding [2] whose premise Amazon describes this way: “A college sophomore spends a weekend with a pretty 14-year-old black prostitute under the manly misapprehension that she has invited him because she finds him irresistible.”I remember reading it as an undergraduate and finding it mildly amusing. Of course, inflation being what it is, it’s hard to write a book about a piddling hundred dollar misunderstanding anymore. But somehow the novel came to mind today when reading one of my favorite websites — The College Fix [3]. The...
  • Furious Chinese Demand Money Back As Housing Bubble Pops

    03/24/2014 7:34:39 AM PDT · by SeekAndFind · 4 replies
    Zero Hedge ^ | 03/24/2014 | Tyler Durden
    <p>Hell hath no fury like a woman scorned or, it seems, like a Chinese real estate speculator who is losing money. After four years of talking (and not doing much) about cooling the hot-money speculation that is the Chinese real-estate bubble (mirroring the US equity market bubble since stock-ownership is low in China), the WSJ reports that the people are restless as the PBOC actually takes actions - and prices are falling. With new project prices down over 20%, 'homeowners' exclaim "return our hard-earned money" and "this is very unfair" - who could have seen this coming?</p>
  • Margin Debt Hits All-Time High

    02/02/2014 12:46:29 PM PST · by Red in Blue PA · 16 replies
    In the month of December margin debt on the NYSE surged by over $20 Billion dollars hitting a new all-time high of $444.931 billion. The rise in leverage also sent investors net worth to a negative $149.358 billion which is also a record. This is shown in the chart below.
  • Bitcoin -- Boom or Bubble?

    01/20/2014 8:17:37 AM PST · by Errant · 29 replies
    Real Clear Politics ^ | 20 January, 2014 | Robert Samuelson
    WASHINGTON -- The baffling Bitcoin boom is either an exercise in self-delusion -- a high-tech Ponzi scheme that will come crashing down -- or an imaginative new Internet technology that will ultimately change how millions of people around the world conduct everyday business. There is little middle ground. Called a "digital currency," Bitcoin originated in early 2009 with a software program written by Satoshi Nakamoto. Who is Nakamoto? Good question. It's a pseudonym, and we don't know who's behind it -- whether man or woman; individual or group; American, Japanese, Russian or some other nationality. But what seems clear is...
  • The 'Facebook Bubble' Bubble

    A tug of war is taking place between Facebook (FB) bulls and bears. It is playing out in the blogosphere and financial news outlets. Facebook has passionate longs and shorts as can be expected with a stock that has increased to the degree it has over the past year. Those who are short Facebook are clinging to two particular themes that warrant contemplation since the hopes and livelihood of short-sellers are resting heavily upon them: (continued)
  • No, the 'College Bubble' Isn't Popping

    01/10/2014 4:57:23 AM PST · by SeekAndFind · 27 replies
    The Atlantic ^ | 01/10/2014 | JORDAN WEISSMANN
    When newspaper editors are in the mood to run a good old-fashioned screed about the collapsing value of college, they inevitably turn to Richard Vedder, an Ohio University economist who runs the Center for College Affordability and Productivity. Vedder likes to argue that the financial return on a B.A. is falling, graduates are chronically underemployed, and that our profligate universities are in for a reckoning once everyone wises up and stops throwing their money away. (For what it's worth, I tend to disagree). Today Vedder and one of his students, Christopher Denhart, have upped the ante a bit for The...
  • Beware the Tech BubbleBut Stay Calm

    12/30/2013 5:34:35 AM PST · by SeekAndFind · 24 replies
    Wall Street Journal ^ | 12/30/2013 | Farhad Manjoo
    I spend a lot of time worrying about the next tech bubble. It's my job to worry, of course, and this year, worrying became a full-time occupation. Ever since Facebook's stock price rebounded this year to the level of its initial public offering, tech startups have seen an incredible run-up in valuations.
  • Astronomy Picture of the Day -- Sharpless 308: Star Bubble

    12/24/2013 7:46:27 PM PST · by SunkenCiv · 3 replies
    NASA ^ | December 24, 2013 | (see photo credit)
    Explanation: Blown by fast winds from a hot, massive star, this cosmic bubble is huge. Cataloged as Sharpless 2-308 it lies some 5,200 light-years away toward the constellation of the Big Dog (Canis Major) and covers slightly more of the sky than a Full Moon. That corresponds to a diameter of 60 light-years at its estimated distance. The massive star that created the bubble, a Wolf-Rayet star, is the bright one near the center of the nebula. Wolf-Rayet stars have over 20 times the mass of the Sun and are thought to be in a brief, pre-supernova phase of massive...
  • Fact, Fiction, And 11 Bitcoin Myths

    12/12/2013 8:24:38 AM PST · by Errant · 59 replies
    Zero Hedge ^ | 12/12/13 | Tyler Durden
    Haters gonna hate, but the Bitcoin bubble meme has become the financial equivalent of a viral online cat video wildly popular but pretty vacuous. In an effort to separate fact from fiction, ConvergEx's Nick Colas reviews 11 bitcoin myths (and dispels them). Still, theres no doubt that the public is entranced: there are now 3x more Google searches for bitcoin than Western Union, and 33x more than for Gold coins. We started writing about bitcoin back in February because it was and still is a fascinating invention (for better or worse). How it plays out, we will...
  • Oh We Got Trouble, Right Here In Bubble City: Real Income Fallinbg While House Prices Rise

    12/09/2013 11:31:31 AM PST · by whitedog57 · 2 replies
    Confounded Interest ^ | 12/09/2013 | Anthony B. Sanders
    There are cheers from the media about the latest jobs report. While some speculated that it was so good that The Fed would begin tapering their assets purchases, few noticed that the 10 year Treasury yield actually fell on the jobs report. But lets look at the longer term picture. House prices are rising rapidly despite declining real median household income. Problem 1: Labors share of nonfarm business have been falling for decades, but its decline has been accelerating since 2000. laborsharelt No problem, many economists say. The U.S. has been moving towards a service economy for decades. But, ...
  • On West Coast, Along With House Prices (Another Affordability Crisis In Housing?)

    12/05/2013 3:26:29 PM PST · by whitedog57 · 7 replies
    Confounded Interest ^ | 12/05/2013 | Anthony B. Sanders
    Trulia released its price and rent monitor today. In November, asking home prices rose 12.1 percent year-over-year (YoY), increasing in 98 of the 100 largest U.S. metro areas. Regaining a bit of steam since the slowdown began in July, asking prices rose 1.0 percent month-over-month (MoM) and 3.0 percent quarter-over-quarter (QoQ). In fact, the quarterly increase is the fastest in five months, though still lower than in the spring. The west coast along with Atlanta and Detroit(?) are still growing in price at a rapid rate, but that rate is slowing down. askrpicertrulia Rents on the west coast are...
  • Greenspan Baffled Over Bitcoin 'Bubble': "To Be Worth Something, It Must Be Backed By Something"

    12/04/2013 8:43:19 PM PST · by Nachum · 42 replies
    zero hedge ^ | 12/4/13 | Tyler Durden
    "In order for currencies to be 'exchangeable' they have to be backed by something," is the remarkably ironic initial comment from none other than debaser-of-the-entirely-fiat-dollar Alan Greenspan when asked about the "bubble in bitcoin," by Bloomberg TV's Trish Regan. Unable to "identify the intrinsic" backing of Bitcoin (or see bubbles in equity, credit, real estate, or greater fools) Greenspan is, apparently, capable of identifying Bitcoin "as a bubble," because "there is no fundamental means of "repaying' it by any means that is universally accepted." The farcical double-speak continues as the Maestro does a great job of making Bitcoin (which Ron...
  • House Prices, Home Ownership And Real Income - Why Housing Is Still Weak And Investor Dependent

    12/01/2013 10:57:26 AM PST · by whitedog57 · 11 replies
    Confounded Interest ^ | 12/01/2013 | Anthony B. Sanders
    There is a lot of talk about a new housing bubble. If you look at a chart of house prices, you can see why. cs2009 This is a faster acceleration rate in house prices than during the much-discussed housing bubble of the last decade. csindices112613 Can it continue to accelerate? There are a couple of factors that say no. First, real median household income has been falling since 2000 and particularly since 2009. It is difficult to maintain price growth under these conditions once investors pull out. csrealinc Second, home ownership rates continue to fall . along with real median...
  • Talk of a Stock Market Bubble is Baloney

    11/27/2013 7:28:07 AM PST · by SeekAndFind · 23 replies
    SERVO WEALTH ^ | 11/26/2013 | Eric D. Nelson, CFA
    In case you havent noticed, there has been a surge in market forecasts lately claiming that the recent run up in prices has resulted in a stock bubble. There is no universal definition of what actually constitutes a bubble, so well settle for the vague description of a condition where market participants drive stock prices well above their value in relation to some system of stock valuation. The fear of a bubble, of course, is that when the euphoria ends, prices will fall to more pedestrian levels resulting in a significant loss for existing investors who dont bail out first.Pundits...
  • Bankrupty Detroit Leads Case-Shiller House Price Growth For September (Followed By Southwest)

    11/26/2013 7:56:24 AM PST · by whitedog57 · 8 replies
    Confounded Interest ^ | 11/26/2013 | Anthony B. Sanders
    The S&P Case-Shiller repeat sales house price indices were released this morning. The U.S. National Home Price Index rose 3.2% in the third quarter of 2013 and 11.2% over the last four quarters. Call me crazy, but the recent expansion of house prices (red) looks faster than the rapid expansion during the housing bubble (orange). The recent rapid expansion of house prices coincides with the unprecedented monetary stimulus by The Federal Reserve. csindices112613 The big winner from August to September? Bankrupt Detroit! And in the LPS house price report from yesterday, bankrupt Modesto showed a good gain. Other winners in...
  • Are We In Another Tech Bubble?

    11/17/2013 6:26:37 PM PST · by SeekAndFind · 6 replies
    TIME ^ | 11/17/2013 | Raba Foroohar
    Theres a reason why a lot of the worlds top investors, like Warren Buffett, dont invest in technologyit moves too fast. And its too hard to track whether the hot stock or idea of today will be worth anything in five years. Buffett famously references the auto industry when he talks about his aversion to technology stocks. There were hundreds of car companies in the U.S. during the early part of the 20th century, but only a handful survived and made investors any money over the long haul. The big question is, are we in a bubble right now? First,...
  • Trulia's Koklo: "Home Prices Simmering, Not Bubbling" - Really, Jed?

    11/13/2013 9:16:32 AM PST · by whitedog57
    Confounded Interest ^ | 11/13/2013 | Anthony B. Sanders
    For years doctors have been focused on specific cholesterol numbers to help patients prevent initial and recurrent heart attack. New guidelines mean only those at high risk will be recommended to take the drugs. So how will doctors decide who is at high risk? More importantly what are physicians already saying about changes? Dr. Neil Stone of Northwestern University chaired the committee that wrote the new guidelines, which was a collaborative effort between the American Heart Association and the American College of Cardiology. No more statins to control cholesterol numbers say expertsInstead of looking at cholesterol numbers Stone said physicians...
  • Morgan Stanley says internet companies overvalued, lowers view

    11/11/2013 3:50:01 PM PST · by xzins · 14 replies
    Global Post ^ | November 11, 2013 18:02 | Thomson Reuters
    Morgan Stanley lowered its industry view on internet stocks to "in-line" from "attractive," saying growth in the sector needs to accelerate to justify current valuations. Shares of Facebook Inc and LinkedIn Corp have more than doubled in the last one year, and trade 44 and 97 times forward earnings, according to Thomson Reuters data. Google Inc's shares have risen 56 percent in the same period and trade almost 20 times earnings, data showed. Morgan Stanley analysts said the rise in the valuation of internet stocks has been due to investors looking at the total addressable market (TAM) opportunity with minimal...
  • Insight: Yellen Feared Housing Bust But Did Not Raise Public Alarm

    11/02/2013 8:20:16 AM PDT · by Son House · 4 replies
    Reyters ^ | Oct 30, 2013 | Marilyn W. Thompson, Ann Saphir and Alister Bull
    In 2004, the new president told risk managers in San Francisco that closer supervision had "made our financial system far more resilient to shocks." In Phoenix that year, she reported "more positive signs in the economy." She flagged real estate as a concern in March 2005, telling a banking group in Hawaii that her staff was examining commercial lending and was concerned about the "easing of credit standards and terms on loans" for home mortgages. But Yellen ended optimistically, concluding that "we don't think widespread problems are likely" and that "industry conditions in many respects are stronger now than they've...
  • Investors Gone Wild! CS House Prices Rise Most Since 2006 (Vegas Leads)

    10/29/2013 7:13:46 AM PDT · by whitedog57 · 1 replies
    Confounded Interest ^ | 10/29/2013 | Anthony B. Sanders
    S&P Case-Shiller house prices rose by 0.93% in August (MoM) and 12.82% (YoY), the biggest Year-over-Year rise since 2006. csyoy And the Case-Shiller 20 metro index is back to August 2008 levels. spcs102913 Well, we know that it isnt households borrowing to purchase a home that is driving this bubble. Here is a chart from CoreLogic on Purchase Mortgage Credit Production. It remains low. skfig1-purchasemortgage And the MBA Purchase Application index (due out tomorrow) is similarly low (at 1995 levels). mbapurchase1995 In fact, house prices are rising as mortgage purchase applications are falling. csaugmbapurch In terms of metro area price...
  • Expert: Higher Education Bubble Is Coming and States Better Prepare

    10/29/2013 6:07:22 AM PDT · by MichCapCon · 12 replies
    Capitol Confidential ^ | 10/26/2013 | Jarrett Skorup
    LANSING In the next decade, potentially hundreds of colleges will go out of business as their prices push families away from traditional universities, said an expert on higher education. American higher education is in a bubble, said Richard Vedder, an economist at Ohio University and the president of the Center for College Affordability and Productivity, who spoke Tuesday at an Issues & Ideas event sponsored by the Mackinac Center for Public Policy. Vedder, who also is on the Mackinac Center's board of scholars, said the government subsidizing college has increased demand but also pushed prices higher and out of...
  • Does Janet Yellen Know What a Bubble Looks Like?

    09/30/2013 11:52:41 AM PDT · by Kaslin · 9 replies ^ | September 30, 2013 | Mark Calabria
    With Larry Summers withdrawing from the race for Federal Reserve chair, current Fed vice chair Janet Yellen has pulled into the lead to become Ben Bernankes replacement. Previous to her current appointment, Yellen served as president of the San Francisco Federal Reserve Bank The SF Feds district includes three of the worst states in the housing crisis California, Arizona and Nevada. I think its fair to say that without the housing boom and bust in these states we wouldnt have had a mortgage crisis. Given that Yellen was the top banking regulator for this geography, one has to wonder...
  • A Preview Of Tomorrows Case-Shiller House Price Report (Survey Says +0.80%)

    09/23/2013 2:02:08 PM PDT · by whitedog57
    Confounded Interest ^ | 09/23/2013 | Anthony B. Sanders
    Tomorrow at 9am EST, the S&P Case-Shiller house price index will be released. The survey of economists is for a print of +0.80% increase. csfore The high forecast? Lea Tyler from Oxford Economics at +2.50%. The low forecast? E. Green/M. Mulrain at TD Securities at 0.40%. We can look at CoreLogics Loan Performance Index for a peak at what CS might do for July. cslp CoreLogics house price index rose more than 0.80 for July, so we shall see about Case-Shiller tomorrow. But this continues to be a low mortgage purchase application recovery in prices.
  • Real Median Household Income Below 1989 Levels (And We STILL Had A Housing Bubble?!)

    09/20/2013 1:25:43 PM PDT · by whitedog57 · 10 replies
    Confounded Interest ^ | 09/20/2013 | Anthony B. Sanders
    The typical American family makes less than it did in 1989. the most depressing result comes when you look at the longer view of household incomes in the United States. This chart shows real median household income over the past 25 years; that is, the money earned, in inflation-adjusted dollars, by the family at the exact middle of the income distribution. medianhouseholdincome Yes, that is pretty depressing. This in spite of a tax system where 43% of Americans pay no Federal income taxes. The good news? It used to be 47%. This corresponds to my least favorite chart which shows...
  • The New Credit Supercycle? Subprime Auto And Student Loans (Mortgages Next?)

    09/20/2013 7:58:33 AM PDT · by whitedog57 · 2 replies
    Confounded Interest ^ | 09/20/2013 | Anthony B. Sanders
    The last credit supercycle, the housing bubble and easing of mortgage credit, almost took the US economy out. But of course, nothing ever changes. That was the theme of the classic Bernard Malamud novel The Natural where Roy Hobbs strikes out in the climactic moment (Robert Redford hits a titanic home run in the movie to win the game defeating the entire message of the Malamud novel). Take auto loans and student loans, for example. student-debt-is-the-only-kind-of-household-debt-that-rose-during-the-recession-its-now-the-second-largest-consumer-debt-category-after-mortgages The average loan-to-value ratio, or LTV, on vehicle sales to consumers with spotty credit has risen to 114.5 percent this year from about 112...
  • UK Considers Price Controls To Prevent Housing Bubble (UK House Recovery Driven By Investors)

    09/14/2013 9:59:48 AM PDT · by whitedog57 · 2 replies
    Confounded Interest ^ | 09/14/2013 | Anthony B. Sanders
    Fearing another housing bubble in the UK, the Royal Institution of Chartered Surveyors called on the Bank of England to use its powers to cap house price growth at 5% in certain areas. Where in the UK are house prices growing at breakneck speed? London .. and some place outside of Liverpool. london If we compare London house prices (white line) to New York City house prices (gold line), we can see that London did has rebounded more rapidly after the global recession. The largest increase was in London where prices were up 8.1%. Read more: Follow us: @MailOnline...
  • Student Loan Bubble Bursting Or Not? Delinquencies Falling in 2013

    09/10/2013 4:13:23 PM PDT · by whitedog57 · 6 replies
    Confounded Interest ^ | 09/10/2013 | Anthony B. Sanders
    The student loan bubble is starting to burst. The largest bank in the United States will stop making student loans in a few weeks. JPMorgan Chase has sent a memorandum to colleges notifying them that the bank will stop making new student loans in October. We just dont see this as a market that we can significantly grow, Thasunda Duckett tells Reuters. Duckett is the chief executive for auto and student loans at Chase, which means shes basically delivering the news that a large part of her business is getting closed down. And if you read Zero Hedge or AgainstCronyCapitalism,...
  • Housing Bubble the Sequel: Here we go again

    08/22/2013 8:14:07 AM PDT · by SeekAndFind · 16 replies
    Townhall ^ | 08/22/2013 | Bill Tatro
    Here we go again. Having just recently endured a one-hour phone conversation with my friend Steve, a mortgage broker, Im a little bit confused and somewhat worried. Since most of the houses sold in the past year have been all-cash transactions, combined with the fact that mortgage applications have fallen off the cliff, I asked Steve if that means that the average person is no longer a buyer. Steve replied, Define the average person. I articulated, Its not someone who pays all-cash because I know thats the technique on Wall Street, and I also know its a select few...
  • Core Logic: Los Angeles House Prices Up 21%, Phoenix Up 17% (The West Of The Rockies Rebound)

    08/06/2013 12:28:49 PM PDT · by whitedog57 · 11 replies
    Confounded Interest ^ | 08/06/2013 | Anthony B. Sanders
    According to Core Logic, house prices in Los Angeles rose 20.7% Year-over-year. Phoenix rose 19.8%. Texas cities (Houston, Dallas) were up 10%. clcities Excluding distressed sales, the recovery is largely west of the Rockies and Georgia/Florida. clmap The large year-over-year gains occurred when the 30 year mortgage rate was 3.80% (but has risen since late May to 4.37%). br30080613 Rising mortgage rates and 70% of jobs being created are part-time. Throw in nationally flat-to-falling mortgage purchase applications, and we have an INVESTOR-FUELED HOUSE PRICE RECOVERY. lambs Hope those investors keep buying!!!! Sadly, it is difficult for part-time workers to purchase...

    06/22/2013 1:40:12 PM PDT · by SeekAndFind · 14 replies
    Human Events ^ | 06/21/2013 | Steven Greenhut
    Americans are still talking about the recently deflated housing bubble, but theres a new bubble in town. Its the student loan bubble and when this one pops, it might dwarf the wreckage weve witnessed in the real-estate markets. In the latest news, the Federal Reserves Board of Governors warned that soaring student-loan debt has parallels to the housing crisis, according to a May report in Bloomberg. As with housing, free-flowing cash will lead to widespread default. Of course, its easier to repossess a tract house than to take back a potentially worthless degree. Federal Reserve Chairman Ben Bernanke dismissed these...
  • Mortgage Applications Fall 3.3%, Fed FOMC Meets Today at 2pm EST

    06/19/2013 6:08:48 AM PDT · by whitedog57 · 4 replies
    Confounded Interest ^ | 06/19/2013 | Anthony B. Sanders
    The Federal Reserve Open Market Committee (FOMC) meets today at 2pm EST. But is there a bubble? One sign of a bubble is the rise in NYSE margin accounts. Another sign of a bubble is the junk bond yield. But I will tell you where there is NOT a bubble mortgage applications. The Mortgage Bankers Association (MBA) released their weekly mortgage applications this morning revealing that mortgage applications dropped -3.3% from the preceding week. Mortgage purchase applications fell 3.04% from the previous week and remain at 1997 levels. Mortgage refinancing applications fell 3.43% from the preceding week. This is...
  • CANADA IS DOOMED: Three Signs That The Country Up North Is Screwed Beyond All Recognition

    06/17/2013 9:16:17 AM PDT · by SeekAndFind · 55 replies
    Business Insider ^ | 06/17/2013 | Josh Barro
    You might be under the impression that everything is going pretty well in Canada, which had no banking collapse and only a mild recession in 2008-9. You would be wrong. The country is beset by political corruption scandals of the sort that people focus on when the economy is good. But it also has a massive ongoing housing bubble, and its economy is being propped up by a global commodities boom that now shows signs of slowing. Let's break down the three ominous signs. First, the scandals: Montreal Mayor Michael Applebaum got arrested this morning, charged with 14 counts including...
  • The Education Bubble Has Burst: Students and Parents already know it, only Government Doesn't

    06/11/2013 7:24:36 AM PDT · by SeekAndFind · 28 replies
    American Thinker ^ | 06/11/2013 | Frank Ryan
    The student loan debate in Congress is bringing to the forefront the student loan crisis plaguing our nation, as well as the financial instability of academic institutions in the United States. Relative to the student loan crisis, the New York Federal Reserve concluded in its 2012 report that the obligations for student loans total approximately $1 trillion, or approximately $25,000 per graduate. The report notes that there are over 15 million borrowers under the age of 30, while the total number of borrowers is almost 39,000,000. The delinquency rates on the loans range between 10% to 20% for the various...
  • Uh-oh! Mortgage Rates Trending Upwards, Lumber Futures And Architectural Billings Decline

    05/24/2013 8:25:41 AM PDT · by whitedog57
    Confounded Interest ^ | 05/24/2013 | Anthony B. Sanders
    Uh-oh. Mortgage rates are rising at the same time that leading indicators (lumber futures and architectural billings) are declining. According to Freddie Mac, the government-sponsored enterprise in conservatorship, mortgage rates are trending upwards. The primary-secondary mortgage rate spread has fallen below 100 basis points (but remains elevated since Fannie and Freddie were put into conservatorship). At the same time, lumber futures continue to decline. Architectural billings plunged declined by the most since 2008. And architectural inquiries also declined. House prices remain elevated since a year ago (FNC, Case-Shiller, Loan Performance, FHFA). Lets see how this impacts prices.
  • The College Bubble Is Finally Bursting

    05/14/2013 8:26:05 AM PDT · by SeekAndFind · 12 replies
    Business Insider ^ | 05/13/2013 | Rob Wile
    Private colleges are offering record financial assistance to keep classrooms full, according to the Wall Street Journal's Ruth Simon. Some schools are seeing just 20% of the students they accepted enrolling, versus the usual rate of 33%. These schools have raised tuition discount rate the price after grants and scholarships to an all-time high of 45%. Meanwhile, the median sticker price increased just 3.9% last fall, the smallest gains in 12 years. And at public schools, the sticker price climbed just 4.8%, also a 12-year low. For the Washington Examiner's Michael Barone, this makes it official: the college...
  • Here's Evidence That The Fed Is Inflating A Stock Market Bubble

    05/10/2013 9:05:32 AM PDT · by SeekAndFind · 6 replies
    Business Insider ^ | 05/10/2013 | Ed Yardeni
    In the February 5 Morning Briefing, I outlined the Irrational Exuberance scenario as follows: In a melt-up scenario, the market [S&P 500] would do just that, jumping to my yearend target [1665] or higher before the middle of the year. The Feds critics, including dissenters on the FOMC, will warn that ultra-easy monetary policy is once again pumping air into a stock market bubble. So a melt-up could be followed by a meltdown, or at least a very nasty 15%-20% correction later this year if the Fed is forced to stop its quantitative easing by soaring stock prices Alternatively,...
  • Negative Real Interest Rates Fuel Yet Another Housing Bubble

    05/09/2013 8:50:05 AM PDT · by SeekAndFind · 8 replies
    Townhall ^ | 05/09/2013 | Mike Shedlock
    It's easy to spot a Fed-sponsored housing bubble if you look in the right places. The best place to start is an analysis of price inflation as measured by the BLS as compared to a CPI-variant that takes actual housing prices into consideration instead of rent. This is a followup to my post Dissecting the Fed-Sponsored Housing Bubble; HPI-CPI Revisited; Real Housing Prices; Price Inflation Higher than Fed Admits. Data for the following charts is courtesy of Lender Processing Services(LPS), Specifically the LPS Home Price Index (HPI). The charts were produced by Doug Short at Advisor Perspectives. Anecdotes on the...
  • Fed Fueling Stock Market Inflation

    04/21/2013 5:43:42 AM PDT · by OwenKellogg · 14 replies
    American Thinker ^ | April 20, 2013 | Col. Frank Ryan, CPA, USMCR (Ret)
    ... The reality of the Fed's actions, when combined with expansionary fiscal policy, is that neither fiscal nor monetary policy is effective any longer in dealing with the systemic structural issues in the Western world's economies. Additionally, the Federal Reserve's policies are borderline negligent and irresponsible. The Fed is creating the next bubble that will make the housing bubble bursting look tame. When interest rates have been maintained at near zero rates for over five years, entire economic structures and systems/businesses become dependent upon such low rates. The Fed's current policies fail to reflect that economic uncertainty is preventing the...
  • Eight Steps to Eliminate Fannie Mae and Freddie MacPermanently

    04/17/2013 2:16:54 PM PDT · by Slyfox · 13 replies
    Heritage Foundation ^ | April 10, 2013 | David C. John
    It is time to close both Fannie Mae and Freddie Macthe government-sponsored mortgage giants. Both entities distort the countrys housing finance market by issuing mortgage-backed securities with subsidized government guarantees that the mortgages will be repaid. If guarantees are necessary, they should be priced and issued by the private sector, not by the state. Financial institutions expert David C. John details specific steps to achieve this shutdown carefully and methodically without further upsetting the delicate housing marketand without making the situation worse.
  • Bitcoin bubble may have burst

    04/12/2013 6:57:14 PM PDT · by mnehring · 34 replies
    The price of Bitcoins has plunged more than 70% in the past two days, sparking a rush of activity that overwhelmed trading platforms and suggested the bubble in the virtual currency has burst. Bitcoins were down to $77.56 as of 3 p.m. ET Friday. Prices reached as high as $266 per Bitcoin around 7:30 a.m. ET Wednesday. But the price started to fall through the rest of day and Thursday morning. At about 10 a.m. ET Thursday, trading was halted on Mt.Gox, a Japan-based exchange that claims to handle 80% of Bitcoin trade worldwide. The price at that time...
  • Reinflating the housing bubble (The Federal Housing Authority is at it again)

    04/11/2013 7:11:36 AM PDT · by SeekAndFind · 3 replies
    Washington Times ^ | 04/11/2013 | By Nita Ghei
    There is evidently no idea bad enough and no failure severe enough to stop the government from trying it once again. In myopia remarkable even by abysmal government standards, the White House is pushing for policies that fueled the housing bubble, which burst a mere five years ago. Reintroducing those policies at this stage of a nascent recovery in the housing market will set the stage for repeating history, and very likely leave taxpayers on the hook once again for another bailout. Last week, the administration began exerting pressure on banks to lend to people with lower credit scores, arguing...
  • Bubble bigger than housing about to pop

    03/30/2013 5:22:09 AM PDT · by SeekAndFind · 48 replies
    MSN Money ^ | 03/29/2013 | Michael Vodicka
    The most devastating market events are those that no one sees coming. Take what happened to Lehman Brothers in 2008, for example. Up until the last minute, virtually no one could have imagined one of the country's leading investment banks would file for bankruptcy. The housing market crash was the same way. The Street believed housing prices would never go down. With the market totally blind to the growing risk in each investment, anyone who had investments in housing or with Lehman Brothers suffered huge losses. Despite these tough lessons, there is now another epic bubble developing and the market...
  • Housing And The Fed: A Low Rate, Multiplier And Velocity Recovery?

    03/28/2013 9:31:37 AM PDT · by whitedog57
    Confounded Interest ^ | 03/28/2013 | Anthony B. Sanders
    Nick Timiraos at the Wall Street Journal wrote in interesting piece yesterday called Home Prices Seen Making Stronger Gains in 2013. Numerous analysts have upgraded their forecast for house price growth for 2013, primarily based on limited inventory and growing demand. And then Fed of Minneapolis President Narayan Kocherlakota reinforced the notion that The Fed will keep the pedal to the metal (MORE asset purchases) even if unemployment falls below 6.5%. Bloomberg News reports that Federal Reserve Bank of Minneapolis President Narayana Kocherlakota, in a speech he gave on Wednesday, said the Feds Open Market Committee may choose not to...
  • The Housing Bubble Is Back

    03/26/2013 8:30:22 AM PDT · by SeekAndFind · 1 replies
    Forbes ^ | 03/26/2013 | Karl Smith
    Cullen Roche is worried that the trajectory of housing prices might deviate from what practical assumptions would predict. "Real estate returns are not rocket science. Because theyre such a huge portion of the consumer balance sheet they tend to be tied very closely to wage growth. Wage growth, by definition, is very closely tied to the rate of inflation. That explains why the long-term historical return of real estate is roughly in-line with rate of inflation. But this survey from Zillow shows that real estate investors are probably still too optimistic." I can see why these assumptions are attractive, but...
  • US Begins Regulating BitCoin, Will Apply "Money Laundering" Rules To Virtual Transactions

    03/21/2013 8:23:52 PM PDT · by 2ndDivisionVet · 13 replies
    Zero Hedge ^ | March 21, 2013 | Tyler Durden
    Last November, in an act of sheer monetary desperation, the ECB issued an exhaustive, and quite ridiculous, pamphlet titled "Virtual Currency Schemes" in which it mocked and warned about the "ponziness" of such electronic currencies as BitCoin. Why a central bank would stoop so "low" to even acknowledge what no "self-respecting" (sic) PhD-clad economist would even discuss, drunk and slurring, at cocktail parties, remains a mystery to this day. However, that it did so over fears the official artificial currency of the insolvent continent, the EUR, may be becoming even more "ponzi" than the BitCoins the ECB was warning about,...
  • U.S. House Prices About To Soar... Don't Wait A Moment Longer!

    03/22/2013 4:35:06 AM PDT · by blam · 58 replies
    TMO ^ | 3-21-2013 | Steve Sjuggerud
    U.S. House Prices About To Soar... Don't Wait A Moment Longer! Housing-Market / US HousingMarch 21, 2013 - 09:56 AM GMT By: DailyWealth Steve Sjuggerud writes: "We're only one year into this recovery..." Doug Yearley said on Bloomberg TV yesterday morning. "Remember, we had seven of the worst years in housing that this country has ever seen. This recovery, we believe, should be a lot longer than just one or two years." Yearley is the CEO of Toll Brothers, a nationwide homebuilder. When asked if he thought the strength in housing could continue, he didn't mince words... "We feel really...
  • The Dow Hits An All-Time High! Translation: A Bubble Is Always Biggest Right Before It Bursts

    03/10/2013 8:07:38 AM PDT · by SeekAndFind · 24 replies
    TEC ^ | 03/09/2013 | Michael Snyder
    Reckless money printing by Federal Reserve Chairman Ben Bernanke has pumped up the Dow to a brand new all-time high. So what comes next? Will the Dow go even higher? Hopefully it will. In fact, it would be great if the Dow was able to hit 15,000 before it finally came crashing down. That would give all of us some more time to prepare for the nightmarish economic crisis that is rapidly approaching. As you will see below, the U.S. economy is in far, far worse shape than it was the last time the Dow reached a record high back...
  • The Two Towers (of Equity) Versus The Underlying Economy and Housing: Bubbleicious?

    03/05/2013 11:12:53 AM PST · by whitedog57
    Confounded Interest ^ | 03/05/2013 | Anthony B. Sanders
    We are at another high for the S&P 500 index, thanks mostly to the Federal Reserves zero interest rate policy. The last peak of the S&P 500 was on October 9, 2007 when it closed at 1565.15. The U6 unemployment rate was 8.4%. Today it is 14.4%. Q3 2007 Real GDP growth had risen 3.0%. Q4 Real GDP growth is at an anemic 0.126%. People on food stamps (SNAP) has grown from 26.9 million in October 2007 to 47.69 million at the latest reading. Gasoline prices? $2.75 in October 2007, but now they are $3.73 per gallon for regular. Feds...
  • Now You Can Short The Student Loan Bubble

    03/04/2013 8:12:32 AM PST · by SeekAndFind · 4 replies
    Business Insider ^ | 03/04/2013 | Tyler Durden
    Even as the gargantuan $1+ trillion student debt load has been the bubbly elephant in the room that few are still willing to talk about (as the ease of obtaining very fungible loans, with ultra-low interest rates, have become the primary source of lifestyle funding for a wide swath of Americans who are rotating out of high yielding credit cards into this latest Uncle Sam subsidy, and is thus just one more aspect of the status quo perpetuation), there have been until now zero opportunities for a the proverbial highly convex "ABX" short in the student debt space. This of...
  • Nouriel Roubini Is BullishFor Now: The Mother of All Bubbles Has Begun

    02/22/2013 8:26:14 PM PST · by ExxonPatrolUs · 7 replies
    Yahoo Daily Ticker ^ | 2.22 | Aaron Task
    Two days of weakness in stocks after the Fed hinted it might vary the pace of asset purchases has some folks ready to declare the bull market over and done. Exit any and all bullish constructed positions and rush to the sidelines," declares veteran trader and newsletter writer Dennis Gartman. Others, including Pimcos Mohammed El-Arian, Gloom Boom and Doom author Marc Faber and hedge fund manager Doug Kass have made similar comments in recent days, albeit sans Gartmans dramatics. Related: PIMCO's El-Erian: Maintaining High Equity Prices Will Be Hard Given this backdrop and with the economy facing myriad headwinds from...