Daily Digest

Daily Digest 9/24 - Surviving And Resilience, More On China-Japan Rare Earth Export Ban, Man Without Mortgage Loses Home

Friday, September 24, 2010, 10:59 AM
  • Chris Martenson Podcast On Surviving And Resilience
  • Amid Tension, China Blocks Vital Exports to Japan
  • Unmitigated Incompetence - Man without Mortgage Loses Home in Foreclosure
  • Bubble, Bubble, Toil and Trouble!
  • The Bastard Child Of The Mother Of All Bubbles
  • Energy policy in Quebec: High-Speed Gas
  • After The Kill
  • Why is 'food security' sparking unrest?

Crash Course DVDThe 3-disc DVD with presenter’s pack offers helpful guidance for sharing the 3E message with your community. (NTSC or PAL)

Economy

Chris Martenson Podcast On Surviving And Resilience (pinecarr)

Today, Martenson has a post which, however, touches on something completely different: survival. In his words: "I was interviewed by Jack Spirko of The Survival Podcast. We had a meaty exploration of the core tenets of the Three Es (Economy, Energy, Environment) in light of recent developments, then delved pretty deeply into strategies for building personal resilience, which is the main focus of Jack's regular podcasts. I enjoyed myself and think the discussion is worth listening to."

Amid Tension, China Blocks Vital Exports to Japan (VeganD)

A Chinese Commerce Ministry spokesman declined on Thursday morning to discuss the country’s trade policy on rare earths, saying only that Mr. Wen’s comments remained the Chinese government’s position. News agencies later reported that Chen Rongkai, another ministry spokesman, had denied that any embargo had been imposed.

Unmitigated Incompetence - Man without Mortgage Loses Home in Foreclosure (Davos)

“When Jason Grodensky bought his modest Fort Lauderdale home last December, he paid cash. But seven months later, he was surprised to learn that Bank of America had foreclosed on the house, even though Grodensky did not have a mortgage.

Grodensky knew nothing about the foreclosure until July, when he learned that the title to his home had been transferred to a government-backed lender. “I feel like I’m hanging in the wind and I’m scared to death,” said Grodensky. “How did some attorney put through a foreclosure illegally?”

Bubble, Bubble, Toil and Trouble! (Ilene)

I had already mentioned in the morning post that "bear is the word" and this is where the free readers tend to get confused because I was all bullish for the beginning of the month but, as I say often enough and as our Members know very well - I am not bullish, I am RANGEISH - which is a very different thing. 10,700 is the top of our range and with the Russell failing to confirm our 5% line at 666 (they hit it but didn't hold it) kept us cautious and then we turn to the news flow to see if we're going to have the gas to get past our major resistance lines and, so far, no - we do not.

    Crash Course DVDThe 3-disc DVD with presenter’s pack offers helpful guidance for sharing the 3E message with your community. (NTSC or PAL)

The Bastard Child Of The Mother Of All Bubbles (JimQ)

Easy Al Greenspan created the Mother of All Bubbles by keeping interest rates at 1% for a prolonged period of time while encouraging everyone to take out adjustable rate mortgages. His unshakeable faith in the free market policing itself allowed Wall Street criminals, knaves and dirtbags to create fraudulent mortgage products which were then marketed to willing dupes and “retired” internet day traders. Al’s easy money policies and disinterest in enforcing existing banking regulations also birthed the ugly stepsister of the Mother of All Bubbles. Her name is the Consumer Debt Bubble.

Energy

Energy policy in Quebec: High-Speed Gas (jdargis)

This abundance of cheap renewable electricity is the main reason why Quebeckers are “finicky” about shale gas, says Christian Bourque, a pollster based in Montreal. It has allowed them to be proudly green. At the Copenhagen summit on climate change in December, officials from Quebec publicly chided their counterparts from Alberta over their failure to reduce carbon emissions from the tar sands in the western province. They also called on the federal government to speed up its lackadaisical efforts to bring in a national plan to reduce emissions.

After The Kill (jdargis)

On September 19th, nearly five months after the spill started, BP, the company leasing the rig, finally sealed the Macondo well. An adjoining relief well had already been completed, and Macondo got a final wallop of cement. This is the coup de grâce. A temporary containment cap was placed over the wellhead in July, and a cement filling was installed in August.

Now more efforts will turn to assessing and compensating for the damage, which involves several things happening at once.

Environment

Why is 'food security' sparking unrest? (Jeff B.)

The UN's Food and Agricultural Organization will be holding a special meeting to discuss the issue and the recent volatility in Rome on September 24.

The meeting was called after Russia decided to ban wheat exports after a punishing drought wiped out 25 percent of its crop. Moscow's decision pushed food prices up about 5 percent worldwide. Bread prices surged in some countries and triggered the deadly riots in Mozambique.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

14 Comments

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
Joined: Jul 30 2009
Posts: 4145
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

"Sept. 23 (Bloomberg) -- Illinois, facing the worst financial crisis in its history, received a negative outlook on $25 billion of general obligation bonds from Moody’s Investors Service after failing to address a deficit that almost tripled in one year."

"The yield of taxable Build America Bonds issued by Illinois in June has risen to almost 2.5 percentage points above benchmark 30-year Treasury bonds from just over 2 percentage points on June 24.

Illinois’s budget deficit in 2009 widened to $7.7 billion, almost tripling, Moody’s said. The debt burden may increase because of continued borrowing for the state’s capital program and contributions to its pension plans, the company said.

State pensions in Illinois, Kansas and New Jersey all have assets insufficient to cover benefits, according to data compiled by Bloomberg.

Illinois ended fiscal 2010 on June 30 “in the worst fiscal position in its history,” Comptroller Daniel Hynes said in a report.

The state’s backlog of unpaid bills rose to $4.7 billion from $2.8 billion a year earlier and its general fund balance fell to negative $4.7 billion, the lowest level in the state’s history."

"WASHINGTON (MarketWatch) - U.S. new home sales were flat in August, matching the second lowest level on record, the Commerce Department estimated Friday. Sales were steady at a seasonally adjusted annual rate of 288,000 units, below the 300,000 pace expected by economists surveyed by MarketWatch. Sales plunged in May to a record low after tax breaks for homebuyers expired and have bounced around at low levels over the past three months. New-home sales in July fell a revised 7.7% to a 288,000 level compared with the previous estimate of a 12.4% fall to 276,000. New-home sales are down 28.9% compared with a year ago. The supply of new homes fell 1.4% to 206,000. Supply in relation to sales fell slightly to 8.6 months in August from 8.7 months in July. Median sales prices have fallen 1.2% in the past year to $204,700."

........................2A) August new home sales second slowest on record

"The $7.3 billion budget for the fiscal year beginning Oct. 1 calls for hiking property tax rates 14 percent to offset the drastic plunge in property values and increases in various county fees. County parks will get new parking fees. Water bills will go up, too. To make ends meet, the county is also tapping reserves.

The moves enable Miami-Dade to plug a $444 million budget gap that stemmed from the lower property tax values and a drop in other revenue, such as gasoline and sales taxes. It also provides pay raises for most county employees."

"TOKYO (AP) -- China has halted exports to Japan of rare earth elements -- which are crucial for advanced manufacturing -- trading company officials said Friday amid tensions between the rival Asian powers over a territorial dispute.

Japan imports 50 percent of China's rare earth shipments. Rare earth are metallic elements crucial for manufacturing superconductors, computers, hybrid electric cars and other high-tech products.

The two trading company officials said the shipments were suspended on Tuesday. Companies using the rare metals are believed to have stockpiles that could last several months.

"We are told that only Japan-bound shipments were suspended. The Chinese side did not give any reasons for the suspension," said an official at a major Japanese trading house.

Another trading house official also said China's rare earth exports to Japan were halted on Tuesday. "We don't know when the exports will resume," he said."

  • Other news, headlines and opinion:

Fed Balance Sheet Rises to $2.31 Trillion on Treasury Purchases

China Guts Dollar, Crushes US in Alarming Financial War Game

Gold Rises to Record on Dollar-Hedge Demand; Silver Gains to 30-Year High ("Gold is showing there is no confidence in the dollar”)

World Bank's IFC Leads Push for $13 Billion Bad Debt Market: Russia Credit

US Corporate Credit Risk Gauge Rises on Sovereign Concern

Spain Pressured to Show `Hair Shirt' Budget as Yields Rise

Irish borrowing rates climb to new euro-era high

Portuguese Bonds Lead Peripheral Debt Drop on Austerity Concern

Default would lead to crisis, says Sutherland (Ireland)

Global 'IT debt' hits US$500 billion, on the way to $1 trillion

China's urbanization could cost US$3.6 trillion

Crumbling U.S. Infrastructure Slowing Economic Growth

Banks Sitting Out Corporate Bond Surge as Lending Dries Up: Credit Markets

Junk Bond Revenues Exceed Investment Grade For 1st Time Since 2004

Thousands of policemen protest in Romania

11000 Romanian companies reached insolvency in the first 6 months-Source

Fresh strike mobilizes 3 mln protesting France's pension reform

Budget deadlock blamed for toilet paper shortage (California)

Budget crisis could worsen (LSU)

Food pantries and hunger in New Jersey

Homelessness soaring (Oakland County)

Paterson orders 2000 job cuts (New York)

S&P Downgrades $1.71B More Of CMBS CDOs On Credit Woes

250 acres in Palm City that went for $11 million in 2010 sell for $2.4 million

Double-digit hikes for some Medicare drug plans

Most state employees to pay more for health insurance next year (Kentucky)

UAW's King, others vow mass withdrawals to push bank to freeze foreclosures

NJ rating outlook negative as Moody's cites pension woes

Deficit could bring more education cuts (Arizona)

Indiana lawmakers push for Internet taxes

St. Louis facing $40 million budget shortfall

Rising PERS Rates Mean Budget Cuts (Oregon)

Question of the Day: How Many People Have Exhausted All Their Unemployment Benefits? (Mish)

Gold ATM sure to make a mint (Spain...video)

r's picture
r
Status: Gold Member (Offline)
Joined: Oct 2 2008
Posts: 262
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

Eric Weiner talks about his book "The Shadow Market: How a Group of Wealthy Nations and Powerful Investors Secretly Dominate the World.":

http://marketplace.publicradio.org/display/web/2010/09/23/pm-using-shado...

There's also a whiteboard explanation of the $16T shadow banking system for dummies like me:

http://marketplace.publicradio.org/display/web/2010/07/21/whiteboard-sha...

 

DavidC's picture
DavidC
Status: Silver Member (Offline)
Joined: Sep 29 2008
Posts: 243
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

saxplayer,

I'm getting the feeling, judging by the number of links you have today, that things might not be getting any better! Still, the Dow's up in the mid 10,800s again so everything MUST be all right  (e-r-r-m...).

pinecarr's link to ZerHedge's post about Chris's podcast (hope you're keeping up!) is well worth reading. Chris is obviously highly regarded by the ZeroHedge crew (and rightly so).

DavidC

 

idoctor's picture
idoctor
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Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

More Americans Discovering New Investment: Their House http://www.cnbc.com/id/39342652

 After using their homes as piggy-banks during the housing boom, more Americans are now doing the opposite: putting more cash into their house in order get a better mortgage rate—and possibly a better return than stocks and bonds.

Comstock Images | Getty Images

"If someone is going to stay in their home and they can get a lower interest rate by using their own cash for refinancing, they can get a decent rate or return," says Mark Goldman, a professor of real estate at San Diego State University. "In some cases that return could be as high as 18 or 19 percent."

The trend—called cash-in refinancing—simply means homeowners put more cash into their house to make up for the equity they've lost during the recent housing collapse. This allows them to qualify for refinancing to get a lower mortgage rate—and lower monthly payments. Most lenders require 20 percent equity to refinance and with home values decreasing over the last couple of years, many borrowers are equity 'short.'

More homeowners appear willing to come up with the extra cash.

The latest statistics from Freddie Mac show that 22 percent of all refinancing in the second quarter of 2010 were cash-ins. That ties the third highest level of cash-ins since Freddie began keeping records of refinancing patterns in 1985.

"We're expecting the numbers of cash-ins to grow or at least stay at the same high level going forward," says Frank Nothaft, chief economist at Freddie Mac. "The record low interest rates are primarily what's behind it."

Other reasons for cash-in refis include getting rid of private mortgage insurance for loans that are more than 80 percent of the home value, reducing a mortgage term, say from 30 years to 15, and closing out a jumbo mortgage that carries higher rates than conventional loans.

To figure out if a cash-refi is right or not, it comes down to doing the math, says Bob Walters, chief economist at QuickenLoans.com.

"If someone bought a house for $200,000 at a 30-year fixed at 6 percent and paid 20 percent down, they'd owe $160,000 on the mortgage," Walters explains. "Then the house fell in value to $170,000, you owe $10,000 more than it's worth. But if you have the ten thousand to get to a 4 and 1/4 interest rate, your payment will go down to about $920 from $1,250. That could be a higher rate of return than if that $10,000 was sitting in a bank, cd or even some stocks."

And as an investment, homeowners don't need to worry about housing prices falling even further says David Adamo, CEO of Luxury Mortgage—as long as they keep paying the loan.

"It doesn't matter if prices go down, the trade off is still good if you continue to make your payments," Adamo says. "You are dropping your interest rate and monthly housing costs. That return on investment is something that's not speculative."

But even after doing the math, cash-in refinance comes down to how much money a homeowner can afford—and how long they plan to stay in the home.

"The downside to this is, if you need to have a lot of cash on hand for future spending, this could reduce your liquidity," says SDSU's Goldman. "People have to have money available to do it. The other point to make is that if you're not planning to spend the next 5,6 7 years in the house, it's not right either. There would be no reason to put money in a house you're not going to stay in over time."

"It's not for everyone," QuickenLoans' Walters goes on to say. "You have to figure out the closing costs for refinancing and the fact that you would also have lower mortgage interest deductions at tax time. But the math is compelling if you can come up with the cash."

 

Ruhh's picture
Ruhh
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Re: Thousands of policemen protest in Romania

Thousands of policemen protest in Romania

HAHAHA!!! So who beats, tear-gasses and arrests the protestors when the protestors ARE the police?

simentt's picture
simentt
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Re: Thousands of policemen protest in Romania

Ruhh,

HAHAHA!!! So who beats, tear-gasses and arrests the protestors when the protestors ARE the police?

Either noone, which is when the state falls, or the military, which is when the state has failed.

Good times, as they say.

 

-S

mainecooncat's picture
mainecooncat
Status: Gold Member (Offline)
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Posts: 488
Re: Thousands of policemen protest in Romania
Ruhh wrote:

Thousands of policemen protest in Romania

HAHAHA!!! So who beats, tear-gasses and arrests the protestors when the protestors ARE the police?

My money's on the paramilitary contractors.

Jager06's picture
Jager06
Status: Gold Member (Offline)
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Posts: 395
Re: Thousands of policemen protest in Romania

Who else is going to pay $3000 a day, with a $40k signing bonus and help you get a tax break?

Just don't forget that the loser is usually the one who pays for Hessian troops, and decide early when to get out with your last paycheck cashed and in hand.

 

Jager06

idoctor's picture
idoctor
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Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

jhart5's picture
jhart5
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Posts: 89
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

> http://theburningplatform.com/blog/2010/09/24/friday-funnies-17/

idoctor's picture
idoctor
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Posts: 1731
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

Travlin's picture
Travlin
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Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

Jhart 5

You nailed it.  That is just too funny and true.

Travlin 

jhart5's picture
jhart5
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Posts: 89
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

Tranlin -There will be another Tea Party before long  - This time in Washington and/or on Wall Street - Everyone's Invited. Bring lot's of tea.

Davos's picture
Davos
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Posts: 3620
Re: Daily Digest 9/24 - Surviving And Resilience, More On ...

The Colbert video was good. A true sign of the times. I wish this guy had been there to testify. It amazes me who Congress and economists can't see the 900# gorillas in the room. Our economy, resources and population is the direct result fo a law passed in the 1960s and exponential math.

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