Global Economy Bursting?

[berniek]

"How to stop layoffs or make the statistics look better"

Something similar has been done in Germany, when the recession turned, companies were able to get productivity up quickly, because skilled employees were not let go.

Opel (Ruesselswerk) is really hurting and looking to go to a 28 hour work week.

 

[Randolph Kinney]

Chance of Fed Printing More Money Jumps to 60%


http://www.foxbusiness.com/industries/2012/08/17/chance-fed-printing-more-money-jumps-to-60/

The latest consensus was for $500 billion in additional government bond purchases, on top of the $2.3 trillion the Fed has already bought. The highest forecast was for $750 billion. The majority of economists polled thought the Fed's next policy meeting in September was the most likely time for any announcement on QE3.

Economists lowered their expectations for gross domestic product to 1.8% in the current quarter from 2.0% following a disappointing 1.5% annualized pace in the April-June period.

Fourth-quarter growth is now seen at 2.0%, down from 2.2%, and the consensus for next year as a whole fell to 2%, the survey's lowest prediction for 2013 so far.

The $4 trillion worth of expiring tax cuts and automatic government spending reductions that are set to kick in the new year are seen as one of the main reason businesses are reluctant to hire or invest.

 

[The Warrior Monk]

Chance of Fed Printing More Money Jumps to 60%

My personal opinion is that is it more along the lines of 100%. It's easier to print money than take actual steps to solve the problem. It's also like a drug addiction; the more one tries it and likes it, the more likely they are to do it again.

 

[TxArmadillo]

The Incredible Disappearing Home Inventory

[url]http://blogs.wsj.com/developments/2012/08/17/the-incredible-disappearing-home-inventory/?mod=WSJBlog&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+wsj%2Fdevelopments%2Ffeed+%28WSJ.com%3A+Developments+Blog%29[/URL]

It’s no secret to anyone who has paid attention to housing markets over the past year that the number of homes for sale has dropped sharply.
New interactive maps from Zillow help show where the inventory declines have been the most dramatic and at what price points.

For example, in Phoenix, where inventory was down in June by nearly 48% from one year ago, the biggest decline is for the least expensive third of the housing market, where supplies are down by 67%. This reflects heavy demand from investors for cheap properties that can be held off the market and rented at a profit.

“On the seller side, most homes priced below $250,000 are attracting a large number of offers and often exceed the asking price,” says Michael Orr, a housing analyst at Arizona State University. That’s created a “dire” situation for home buyers. “Any offer from an ordinary home buyer is typically going to be less attractive than the multiple all-cash offers from investors with few strings attached and no appraisal required. Many ordinary buyers are coming away empty-handed after submitting 10 or more offers.”

Miami inventory is down by 35% from one year ago while Los Angeles and Riverside, Calif., are each down by 36%.

Inventories are also low in some of the hardest-hit markets — those feared to have a large “shadow inventory” of foreclosed homes — because many homeowners can’t sell without taking a big loss. That means markets with high levels of underwater borrowers, or those who owe more than their homes are worth, are perversely seeing fewer homes listed for sale.

In Phoenix, for example, the middle third of the market has 47% fewer homes than one year ago, and the top third has seen a 34% drop in homes for sale. Big drops in the supply of homes for sale — particularly in the West — are beginning to lead to declines in sales volumes.

For the nation as a whole, inventories were down by 20% from one year ago, but it was the middle tier that saw the largest decline in listings (-21%), followed by the top end (-20%) and then the low end (-16%).

Markets that have seen less severe declines in home prices have seen smaller inventory drops. Cincinnati is down by 6% from one year ago, followed by Pittsburgh, which is down by 12%.

 

[Randolph Kinney]

Take a look at this post: http://appraisersforum.com/showpost.php?p=2285971&postcount=14296

With nearly 50% of all mortgaged homeowners in the nation zombified (not including HELOCs), the housing market will continue to go through period of stimulus-driven demand spurts (when investors and first-timers are “activated”) followed by stimulus-hangovers (when investors and first-timers go away) until meaningful de-leveraging occurs, which will take another decade.

40% of all US homeowners are either unqualified, or boderline, creditworthy meaning even if they could sell, it is questionable whether they can rebuy.

Demand for SFR homes is not organic.

What really moves the GDP growth is new home construction and sales. With employment growth and wage growth (declining in real terms) in the toilet, there simply does not exist enough sustain energy to propel real spending.

Another does of QE and another housing stimulus does wonders to make a dead cat bounce. woohoo

 

[Randolph Kinney]

When the news media is hyping Housing Recovery, potential buyers go from thinking about getting into the market to buying for fear of missing the bottom and the run up in price. This can be shown as a stimulus-response mechanism.

After the marginal buyer is exhausted and the bargin inventory is depleted, sales collapse with rising prices, leaving a growing inventory of unsold homes. The same patterned existed with 2009-2010 first time home buyer tax credit.

 

[Terrel L. Shields]

the housing market will continue to go through period of stimulus-driven demand spurts (when investors and first-timers are “activated”) followed by stimulus-hangovers (when investors and first-timers go away) until meaningful de-leveraging occurs, which will take another decade.

agee 100%... Lots of buyers are investors

 

[Randolph Kinney]

Change has come to teachers

http://www.nytimes.com/2012/08/18/n...&_r=1&nl=todaysheadlines&emc=edit_th_20120818

Nearly half of New York City teachers reaching the end of their probations were denied tenure this year, the Education Department said on Friday, marking the culmination of years of efforts toward Mayor Michael R. Bloomberg’s goal to end “tenure as we know it.”

Only 55 percent of eligible teachers, having worked for at least three years, earned tenure in 2012, compared with 97 percent in 2007.

An additional 42 percent this year were kept on probation for another year, and 3 percent were denied tenure and fired. Of those whose probations were extended last year, fewer than half won tenure this year, a third were given yet another year to prove themselves, and 16 percent were denied tenure or resigned.

The totals reflect a reversal in the way tenure is granted not only in New York City but around the country. While tenure was once considered nearly automatic, it has now become something teachers have to earn.

Idaho last year did away with tenure entirely by passing a law giving newly hired teachers no expectation of a contract renewal from one year to the next. In Florida, all newly hired teachers now must earn an annual contract, with renewals based upon their performance.

 

[Terrel L. Shields]

An additional 42 percent this year were kept on probation for another year, and 3 percent were denied tenure and fired. Of those whose probations were extended last year, fewer than half won tenure this year, a third were given yet another year to prove themselves, and 16 percent were denied tenure or resigned.

Which makes kids smarter how?

“They just kept upping the stakes with the scores, putting more pressure on the schools but not really looking at what it all means,” said Pedro Noguera, an education professor

Read the test scores...still down - failure rate? up

[url]http://projects.nytimes.com/new-york-schools-test-scores/new-york-city[/URL]

 

[Randolph Kinney]

An additional 42 percent this year were kept on probation for another year, and 3 percent were denied tenure and fired. Of those whose probations were extended last year, fewer than half won tenure this year, a third were given yet another year to prove themselves, and 16 percent were denied tenure or resigned.

Which makes kids smarter how?

Looks like politicians are now reacting to the runaway cost of education and low academic performance by taking it out on the teachers. Maybe the voters should take out the politicians and schoolboards?

Of course if there were a choice of schools, like charter schools or voucher programs to enable choice, those schools, teachers and school districts would not survive.

Latinos Use 'Parent Trigger' Law to Fix Failing California School

http://latino.foxnews.com/latino/ne...california-trigger-law-to-fix-failing-school/

For the first time in the United States, a group of California parents have successfully used the state's 'Parent Trigger' Law to seize control of their kid's failing public school.

Last week, Superior Court Judge Steve Malone ruled that the parents gathered signatures from the legal guardians of at least half the students at Desert Trails Elementary School and have met all of the requirements under the trigger law.

Now, the public school will be a charter school. Though the school will continue to be publicly funded and open to all, the school would be free to write its own curriculum and disciplinary rules and hire and fire staff without the constraints of union contracts.

Desert Trails is in the middle of impoverished Adelanto, California, a city of about 30,000 people with a 58% Latino population, has been struggling for years parents claim.

According to California State Records, 72 percent of the school's 6th graders are not at grade level in reading, while 70 percent of the schools 6th graders are not proficient in math.

The parents, backed by the nonprofit group "Parent Revolution," will immediately begin reviewing and requesting proposals from private management companies interested in running Desert Trails.

California was the first state to pass a parent trigger law, which allows parents to make changes to the school -- fire teachers or oust administrators -- if its performance is not up to par.