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Tuesday, October 31, 2006

One Good Punch, That's All I Ask

Update: I'm not the only one. The Anchoress:
In fact, he’s not worthy to shine the shoes of any of the men and women serving honorably in Iraq, regardless of whether they have an ivy league degree, or a simple GED diploma, because the ignorant crap that comes out of his mouth proves he is nothing but a flip-flopping knucklehead who seems to be too stupid, too caught up in his insecurities and his Beacon Hill pretensions, and just plain too dishonorable to even understand what our military men and women are doing…or that it takes some serious smarts to cover men from a crippled chopper and then land it safely (or to fly a fighter jet) and it takes enormous personal courage to put yourself at risk to save your platoon.
ACE. Read comments, ugh. Then military cretins will feel better, ugh. Sample:
My younger brother graduated from the Naval Academy with a degree in aeronautical engineering. He's literally an effing rocket scientist, and he fought in Iraq.
Gateway Pundit. QandO. Texas Rainmaker (don't miss this!!! Link it!!!)
Dr. Melissa Clouthier:
John Kerry's words beg so many questions. He has contempt for the military--that much is clear.
It seems to me that in this too-smart world, that there is no justifiable use for force if you're a Progressive. The Democrats seem to believe that it is unfair that America is the lone super power. I always felt that Clinton giving away the secrets to the Chinese was about leveling the playing field--making things fair. In Clinton's case, he looked conflicted and pained every time he attempted a salute. He just couldn't do it. The military made him queasy. The military after all symbolizes a line in the sand--this side is right, this side is wrong.
Over at Blackfive, some idiotic commenters defend Kerry:
At ease, Soldiers. Kerry wasn't calling anyone but president's intelligence into question. After all, it's pretty clear that if it were up to military, we would never have invaded Iraq. Perhaps he mangled the joke a bit, but I was under the impression that speaking like a moron--hell, being a moron--was a quality you guys find endearing in a leader.
Amazing how they just can't stop, isn't it? Last but not least, read about this new American at Free Constitution, who told immigration officials she'd be happy to bear arms to defend her new country. Stan did post the video where Kerry bangs on the heads of American military families with rocks, but this post, I think, is the best commentary on just what Kerry doesn't get. End update.

Betsy Newmark has the story. Kerry (yeah, that Kerry), spoke what he was really thinking while addressing a college class:
Kerry then told the students that if they were able to navigate the education system, they could get comfortable jobs - "If you don't, you get stuck in Iraq," he said to a mixture of laughter and gasps.
Then, of course, Kerry exploded in a froth of rage when called on it:
If anyone thinks a veteran would criticize the more than 140,000 heroes serving in Iraq and not the president who got us stuck there, they're crazy. This is the classic G.O.P. playbook. I’m sick and tired of these despicable Republican attacks that always seem to come from those who never can be found to serve in war, but love to attack those who did.
Well, we do think you would criticize those serving in Iraq, because of your previous behavior with respect to those serving in Vietnam. And you can't weasel out of this, because you are the one lying about and denigrating those who are serving, just as you did 30 years ago.

It's seldom that something brings tears of anger to my eyes, but this did. Most of the people in the military truly are serving out of sense of duty and patriotism. It's not as if they don't work hard enough to make more money at home, bozo. Disagree with the war, disagree with the policy, but don't denigrate them!!! All Kerry has done is remind a nation of disgusted voters exactly why they picked Bush.

Jonah Goldberg is nicer than I can be at The Corner:
My own hunch — echoed by many readers — is that Kerry's just a Vietnam-era fossil who thinks the old nostrums about the draft and the underprivileged still apply. That's the language he's comfortable with. That's the tradition he comes from. ...

I don't think Kerry meant to insult America's military (which doesn't mean he didn't insult them).
Kerry did insult them, and their mothers, and their fathers, and their brothers, and their sisters, and their children, and their cousins, and their friends. There isn't a draft, and very, very few of these people are in the military just because it's the best job they can get!!!! What, they're too stoooooopid to know there's a war on? Too duuuuuumb and religious to realize they're likely to be sent overseas? Too apathetic to nobly run to Canada?

Kerry can just go hold hands with Jane Fonda and whine himself off into a well-deserved oblivion about being molested by Limbaugh. What a total jerk. He knows nothing about the armed forces today. NOTHING. He doesn't know who these people are. They are our best, and they know they are sacrificing a great deal to serve our country.

It would be worth a jail term to lay one good slap across this man's face. Not Christian, but that's the way I'll feel about this for the rest of my life. Just give me one good punch. Please.

We could raise a billion dollars for military families by selling raffle tickets for the opportunity to get one good sock at the lousy SOB at $100 a ticket. We'd be holding bake sales. We'd be collecting money at intersections. If Kerry wants to apologize, that's what he'll do.

People are visiting graves. People are visiting hospitals. People are counting down the days until they come home again, and this total jerk had to come out with this?

ISM & Consumer Confidence

Business activity in October expanded at the slowest pace in more than a year as the effects of a weakening housing market rippled through the U.S. economy.

The National Association of Purchasing Management-Chicago said today that its business barometer fell more than expected to 53.5, the lowest since August 2005, from 62.1 in September. A reading above 50 signals expansion.
Even though the economy is still expanding, this is shaking up those who have been predicting that the housing decline will be manageable. This number is below the bottom of the forecast range.
Consumer Confidence fell in October:
U.S. consumer confidence slipped slightly in October, weakened by consumers' less favorable view of the job market, a survey showed on Tuesday.

The Conference Board said its index of consumer sentiment edged down to 105.4 in October from an upwardly revised 105.9 in September.
The decline seemed pinned on the job market, which raises some interesting questions. Midwestern manufacturing activity was reported down 1.1%, but that is not surprising because of the auto industry problems.
While all these are negative trends (month to month declines), these numbers also still show an expanding economy. The problem with housing is that it does seem to be pulling at what had become a relatively diversified expansion.

But this is why the outright recession in the housing sector is so problematic for the economy: consumer spending has been funded by debt, and a great deal of that debt has been incurred in the form of borrowing against home equity. A slowing in the rate of building and jobs related to housing (mortgage brokers, realtors, construction & home supply) is going to correspond with reduced consumer spending. The lower gas costs don't seem to be offsetting the housing recession enough. My guess is because I don't see prices dropping in stores. Gas seems to be the only thing that is down. I think inflation has picked up in the last few months rather than declining, because everyone's hoping to get by with price increases now.

Also, the cost of employment was up 1% in the third quarter:
-U.S. employment costs rose 1.0 percent in the third quarter, the largest rise in more than two years and one that could heighten concerns at the Federal Reserve over inflation.

The increase in the Employment Cost Index, a broad gauge of what employers pay in wages and benefits, edged up from the second quarter's 0.9 percent gain and was larger than the 0.9 percent rise economists in a Reuters poll had forecast, Labor Department data showed on Tuesday.
Oh, well... I find it hard to complain that after years of real stagnation in wages, they have begun rising in the last year.

Monday, October 30, 2006

Occasionally, We're Ridiculous

Women, I mean. Women in the news sometimes make all us women look bad.

Lileks has a hilarious, lighthearted column in the Philadelphia Inquirer about the first 100 days of the new Democratic congressional majority:
House Minority Leader Nancy Pelosi (D., Calif.) gave an interview in which she set forth the broad new agenda, just in case martial law is not declared:

"The gavel of the speaker of the House is in the hands of special interests, and now it will be in the hands of America's children." (Make them wash off the jam first.) She went on: "I don't mean to imply my male colleagues will have any less integrity... . But I don't know that a man can say that as easily as a woman can."
This is Pelosi at her pure, muddle-headed best. I have no idea what that last highlighted line means. Also, I don't think children will do a better job of government, although Pelosi's remark must surely be an unintentional gift to the conservatives who have been arguing that our mush-headed liberals do, indeed, bear a strong resemblance to children who refuse to grow up. The column juist gets better as it goes on.

Cathy Young, who I generally feel is a big cut above Pelosidom, writes approvingly about the NJ same-sex marriage court decision (the legislature must grant at least civil unions exactly equivalent to marriages within six months):
The decision of New Jersey's high court is a reminder that there are practical inequalities involved. While New Jersey recognizes domestic partnerships, marriage offers many additional privileges -- from survivor benefits for a deceased spouse to the presumption that a biological parent's spouse is the other legal parent of the child.
Whoa!!! Whoa!!!! See, that last kind of points up one of the reasons why those who feel somewhat equivocal about court-opposed same-sex marriage are not just raving bigots. Granted, same-sex couples are probably boffing. However, one must stop and ponder the question of whether the law ought to presume that Mary fathered Margaret's child even if they are married, because scientifically speaking, we know that someone other than Mary had an, er, hand in it.

Historically speaking, this presumption exists in marital law because of the great possibility that the children of a male/female couple were their children, and the certainty that even if they aren't the father's, a pregnancy could have resulted from marital boffing, and thus the lucky father should be prepared to deal with such an eventuality. The advent of DNA testing is now causing some changes in various state laws with regard to this issue.

I am not sure this presumption should apply to same-sex couples. A bunch of special laws have been worked out for surrogacy arrangements and sperm bank inseminations, but the fact is that either Mary or Margaret might chose to go the old-fashioned route, which has the benefit of being much cheaper. And if so, there is surely someone else in the picture, who might or might not have consented to the whole deal. And what if Mary wasn't in on Margaret's decision to bear a child? Does Mary then have the parental responsibility for Margaret's individual decision? Morally speaking, ought Mary be liable for that child's upbringing? I'm just wondering. It seems to me that law should treat births to a Mary-Margaret married couple differently than to a John-Margaret married couple for very good reasons that have nothing to do with religion or bigotry.

Slice this and dice this as we may, the fact remains that there are important differences in same-sex vs opposite-sex couples, and one difference is that a married man and woman do tend to produce children as the natural result of sex. In our culture (and in most) marriage as an institution basically exists for the benefit of the children of marriages, rather than the benefit of the married couple. I doubt you can convince the unmarrieds that they should pay all this money to fund the marrieds otherwise.

Shrinkwrapped's post on the NJ ruling drew very interesting comments which run the gamut of the usual stances, including the "marriage is inappropriate":
I, too, feel that marriage should be a personal and not a legal matter, and any discrimination or benefit in the law respecting marriage, vis a vis single people, should be abolished. The fact is overwhelmingly documented, if not experienced by each of us, that humans are not a monogamous species. Polyamory does exist both overtly and covertly, both sequentially and concurrently, even monogamously. Marriage as we know it (deeply rooted in religious dogma and property law) still implies domination and ownership by one party or the other in one way or another (rights are given up no matter how you cut it). It's not at all clear that gay marriage will do anything to "fix" a flawed system (old myths die hard); but there's no reason to prevent them from making the same mistakes (nearly) everyone else has made. The legal imbalance between marrieds and singles is the real issue in the movement for gay marriage. Absent that, I doubt there would be the push for legalization. We straights should take a page from the gay and lesbian handbook and realize that WE are in the closet. Marriage as it currently stands (unenlightened and antiquated, is hardly a step toward liberation.
To which one can only say, "No s--t, Sherlock!" Marriage is an institution for assigning responsibility, not an institution for liberating yourself. There is a reason why people talk about the "old ball and chain", ya know? I mean, if humans were a monogamous species, we'd never have had to work out an institution like marriage, would we? We'd just naturally all pair up like geese and there'd be no problem, if we were a monogamous species.

The other reason for marriage is the reality that we are a sexed-up species, prone to going forth and multiplying diseases as well as ourselves, and it turns out that all non-isolated promiscuous human societies are superb at generating sick children and sicker adults. This, as people have figured out, causes a lot of pain. Marriage is a risk-mitigation measure rather than a personal liberation measure. That much, darn it, is obvious.

If deciding these issues in the courts is going to lead to the sort of inconsequential analysis cited above, I think we'd better leave it to the legislatures, which are much better at working out this sort of thing.

Amboy, Dwek and Kara

This pot is on the boil. Both Kara Homebuilders and Dwek had large loans, including large loans to Amboy National Bank. Dwek is up on bank fraud charges, and Kara has filed for bankruptcy. This article winds through some of the specifics.

What blew my mind was this:
Dwek's empire meltdown started in May, after he was accused of bouncing a $25.2 million check and withdrawing $21 million that did not belong to him. A Superior Court judge soon froze all of Dwek's assets. When Dwek's loans seemed to be on the verge of default, a trust that involved the sister of Amboy president George E. Scharpf purchased $18 million of the Amboy loans at full value, Amboy officials said. Scharpf could not be reached for comment.

Together, Dwek and Kara loans remaining with Amboy total nearly $108 million.

One $10 million Amboy loan to Dwek drew attention to itself because mortgages on two of three properties securing the loan were not filed in county clerks offices for seven months. The third property was sold months later before the mortgage could be filed.
!!!! Depending on the collateral type, there are different methods of perfecting your security interest, but all of them depend on timeliness of filing. If you think about it, this is the only fair way to do it, because if you don't file notice of your security interest, others may advance funds without realizing the true state of affairs. This raises a ton of questions. Were the bank's internal systems in disarray? Or was someone within the bank helping Dwek to spin it out? Most such account relationships are managed by one or two people, but bank management has the duty to effectively supervise the relationship. And what's with the back-scratchy loan purchase? I sure hope someone's looking at the UCCs too; for construction loans, getting the UCCs right is imperative.

The OCC ought to be all over this bank.

Asbury Park Press has more detail on the Dwek dreck:
Amboy lent Dwek the $10 million in October, according to land and court records. That loan was secured by mortgages placed against three properties: a commercial site in Neptune City, a property in Long Branch and a 4-acre defunct marina in Dover Township, Ocean County.

Amboy already had a mortgage for an earlier $850,000 loan on the Neptune City property. But two other banks were able to get two mortgages totaling $4.1 million placed ahead of Amboy on the Neptune City and Dover Township properties because of Amboy's delay in filing its own $10 million mortgages.
That would make a total of nearly $15 million in mortgages on two properties that Dwek had purchased for $5.35 million....

Also on May 5, the bank sold the $10 million loan to a company, D and D I Inc., whose president is George E. Scharpf, 65, of Colts Neck, the president of Amboy bank. Court records filed by Amboy Bank say D and D paid $9,995,138 for the loan.

It was then sold again on May 31 to D and D Trust, which has Scharpf's sister, Marguerite DiSepio, as a trustee. DiSepio, 68, is also an officer in the Amboy Foundation, the bank's charitable arm, according to state filings.

In addition, Amboy gave Dwek a $12 million loan in February. The mortgage securing that loan on four Ocean Township residential lots wasn't filed with the county until May.
The three mortgages securing the $10 million loan indicate that they were given for $1 and "other good and valuable consideration." Other land records reflect it was a $10 million loan.

In court papers, fiscal agent Donald M. Lomurro, who has been given the job of recommending how to pay off Dwek's creditors, said a judge would have to decide whether the mortgages secure $1 or the full amount.
Whoa!!!! As a wild guess, the $1 mortgage means that Dwek might have some legal cover for not reporting a $10 million dollar encumbrance when he went to get further loans securing this property. According to the first article, Amboy's entire loan loss reserves amount to $58.6 million, while it is into Dwek and Amboy for about $108 million, which doesn't include the $10 million loan shuffle detailed by Asbury Park Press.

According to this article, Amboy has about $1 billion in construction loans, $47.1 million in non-performing loans as of June 30th, and $257.6 million in capital. A $58.6 million loan loss reserve may not be sufficient under the circumstances.

While the stuff about recordation failures and the loan shuffle is extremely unusual in the banking industry, see Northern New Jersey Real Estate Bubble for details on Dwek's personal mortgages on his home (Asbury Park Press):
"Although the house was assessed in 2005 at $1.2 million, public records show the mortgages on Dwek's Crosby Avenue house total $2.4 million. That includes $850,000 in two mortgages issued by Community Bank of New Jersey in 2001 and 2004. The bank was bought by Sun National Bank."

"Washington Mutual Bank issued a third mortgage on the house for $1.5 million this January to Pearl Dwek, Solomon Dwek's wife."
I don't think the markets have adequately recognized the RE problem at all.

Saturday, October 28, 2006

Practically Speaking....

There are indeed problems with allowing men dressed as women to use women's restrooms. The problem is rape.

Guys, don't complain because women go to the restrooms in groups. There are practical reasons for it, especially, it appears, in Grand Central Station.

Keeping The Lightbulbs On

Blogger is being snibbly again. Hopefully this will post.

Read Photon Courier on why cheap power matters, even if you really believe that the US can survive as a post-industrial economy. Which, btw, I don't.

Read Shrinkwrapped about the NJ SC's same-sex marriage edict to the NJ legislature. Don't forget the comments!

Read SC&A on the Australian Mufti Of Animalism. What the mufti's brand of Islam really stands for is the doctrine that men are ravening beasts who cannot be controlled, and that women are instruments of torture to men, unless they're on their backs, in the dark, with their legs spread. What a motivational view of life!

Also read Fausta on the topic:
What will it take for political correctness to finally, finally, be shown for the farce it is, and will the moral people of the world come out and speak out?

Because, without a doubt, the immorality of believing that women do not have a right to their own genitalia, a right to have that that they are born with, by God's grace; the immorality of thinking that a father has the duty to inflict such harm on his own daughter; the immorality of believing that women are "uncovered meat"; and the immorality of sermonizing that not wearing a veil, "swaying when they walk", and wearing make-up deserves rape, is, or at least ought to be, clear beyond any question.
Btw, the mufti's brand of Islam is hardly the traditional one. It is as if a Phelpsian distortion of Christianity had suddenly gained sway over a large population. The lethality of this cult ought to be, as SC&A and Fausta point out, beyond question.

Since male/female relationships are so deeply pervasive in society, I think the sick relationship between men and women in this sect of Islam is at the core of its immorality.

Read Dr. Sanity's post on the nature of the beast devouring the Palestinian people. This is terribly important:
...once the paranoid beast is unleashed, "love, dialogue, and mutual understanding" withers away. The beast will find "uncovered meat"--and souls--to devour and it cannot be contained by "formulas" that ignore the reality of its origin. Hamas will kill Fatah; Fatah will kill Hamas; Palestinians will kill Palestinians--because that is the nature of the beast.

Love and understanding can only thrive when the beast within is acknowledged as one's own; and then chained and civilized. If you let it loose, free to spread its rabid hatred--i.e., your own rabid hatred--just so you can see yourself in that carnival mirror as the heroic victim of another's aggression, then it will always be there to turn on you; to devour and rip you to pieces when it cannot get fresh meat any other way.
What is missing in the mufti's mind is the concept that human beings, especially when they turn to the Infinite for help, can and must control the worst impulses of human nature. And, as Dr. Sanity explains, without that essential determination human beings are ravening beasts.

The Anchoress pointed me to this rather hilarious column by a conservative willing to vote Democrat as soon as one question is answered:
See, I’m a one-issue voter, and my one issue is defeating the Islamist threat facing Western civilization. Given that it involves the survival of our culture and the principles of our Constitution, I think it’s kind of a big deal.
And the Democrats’ non-stop bashing of Bush foreign policy shows they’re with me. This is priority number one and Bush just isn’t getting the job done. Mission accomplished? Please. We’d settle for “Mission Not Royally Screwed Up.”
But I think I must have missed a meeting or accidentally deleted an e-mail from Moveon.org, because I still haven’t seen the Democratic plan to fix Iraq and kick terrorist butt. Could someone please point me to the page of Time magazine’s recent “Barack For President” issue with the Democrats’ “How we defeat the woman-beating, homosexual-executing, book-burning, anti-Semitic, knuckle-dragging Islamists who want to kill us” bullet points? Thanks.
Wazzat? You can’t? Comrade, what do you mean there isn’t a Democratic strategy for terrorism? There’s gotta be. I mean - seriously - what kind of political party has no war plan at a time when we’re actively at war? When 135,000 troops are in the field, and where six weeks ago we foiled a plot to blow 10 American aircraft out of the sky?
The Anchoress is also trying to figure out how and where the Dixie Chicks are being silenced:
The Dixie Chicks were never my cuppa. They are now chattering on about being silenced. Funny how that happens, isn’t it? Tim Robbins got to write and perform in a play about how he was being silenced by the “chill wind” of the Bushies, and now the Chicks are chattering all over the place. That’s some funny sort of silencing.
Ah, Anchoress, I know the answer to that one. In the Cheeping Chickie leftist world, "being silenced" means not being greeted with roars of approval when you speak. It has nothing to do with the having the right and the opportunity to say what you think; it has to do with the fact that people have the unbelievable temerity to disagree with you!

Ann Althouse has proof of the leftist theory of "freedom of speech" in this story of leftist freedom of speech being terribly threatened by a silent show of dissent against a leftist. Don't miss this. Despite the screams of theocracy, the real threat to our constitution is concentrated on the left.

Also, the Anchoress wanted you to read Isis on Islam, and so do I:
It is laughable to me that the Rightosphere longs for a Moderate Muslim presence. Then silences the voice.

It would really help the GWOT and national security, even on this small level, to acknowledge the contributions of Humanist Muslims like Ali Eteraz, Free Muslims Coalition against Terror, and the other voices normally dimmed by the din of passionate discussion. You will find Muslims promoting liberty and freedoms – the more you magnify their message, the safer we all will be. The recently issued TV ad by the Free Muslims Coalition is a great item to discuss.

Friday, October 27, 2006

Thank you, Boeing

The hope in the durable goods report seems to have been concentrated almost solely on aircraft and new orders. Thank God for the incompentence of Airbus, and the competence of Boeing. (Months and months ago Oraculations discussed the need to keep an eye on Boeing, if it flags it's time to head for the stock exit door. You might want to read Oraculations regularly, ya know? Also, it is decorated at random intervals with pictures of Satanic weapons of mass enticement, which ought to be an inducement to men.)

Advance GDP coming in at 1.6% for the third quarter ought to cause a few rewrites of yesterday's optimistic articles (example) about the bubble-proof economy, but it probably won't. These figures are generally substantially revised by later releases. As the BEA explains:
From the advance estimate to the preliminary estimate (one month later), the average revision to real GDP without regard to sign is 0.5 percentage point, while from the advance estimate to the final estimate (two months later), it is 0.6 percentage point.
Still, no matter how you slice it and dice it, the reality is that housing isn't going to recover anytime soon. It will be a drag for years to come, so in order to push against that drag we have to make stuff. And one of the things we do possess the capacity to make competitively is energy, so the best possible public policy is to remove some of the regulatory and legal roadblocks to energy production, which are huge. We can have a good environment and develop energy resources, if we could get the nutcase environmentalists and the courts off our backs. To do so would require Congressional action. You might want to write your piece of political yuck on this issue.

BTW, real inflation is running very high:
The value of all goods and services produced by the economy, the world's largest, rose to an annual rate of $11.4 trillion after adjusting for inflation. Unadjusted for price changes, GDP rose at a 3.4 percent annual pace to $13.3 trillion.
That's reality. You can play with various indexes all you want, but the American consumer's ability to consume is being sucked away by real declining wage incomes, which is why so much debt is building up. And the problem with the housing market is that drawing down on bubble-produced asset inflation has a nasty double rebound effect when the asset inflation stops. You are then left paying higher percentages of debt supported by less real value, which cuts further into the consumer's ability to spend. Since the negative savings rate dropped in the third quarter, we have a long way to go before beginning to stabilize on personal debt.

Not withstanding the extremely preliminary nature of this report, the fact remains that it is likely not to be revised much above 2%. Since the consistent pattern over recent years has been for a fourth quarter substantially slower than the third, the real question now is whether the fourth quarter can come in over 1% growth.

We are most definitely going to be in recession nationally by the end of the first quarter 2007.

Economic Indicators.gov.

Thursday, October 26, 2006

Out And About

I'm on the road today, but while I'm gone you might want to....

Read the Cotillion at Bloglines. These women are smart. For example, take a gander at what Beth of MVRWC dug up. Florida Cracker deserves some sort of a blogging award for a post that begins "In the home of the world's sloppiest nuclear laboratory, absquatulated classified documents could pop their heads up just about anywhere."

Contemplate your very personal contribution to global warming. This article claims that weight gain cuts gas mileage. Aha! Therefore gaining weight causes more burning of fossil fuels and therefore causes global warming. Shame on you! But wait! Don't you dare get out there and exercise, because don't you know that you breathe in oxygen and exhale carbon dioxide? Gracious sakes alive, be responsible! Your personal increased respiration rate is just gonna kill us all. Here's the progressive and environmentally responsible way to handle things. Don't eat, don't move, do sign up for welfare and do just lay in bed. That's the green and responsible way to handle your life.

Try to figure out who's crazier here - the criminal or the Brazilian judge?
A man accused of being Brazil's most prolific serial killer was sentenced Wednesday to more than 20 years in prison in the first of 42 possible trials for the slaying and mutilation of boys.

Francisco das Chagas Rodrigues de Brito, a 41-year-old bicycle mechanic, was given 19 years for homicide and one year and eight months for hiding the body of the 15-year-old victim, the court said in statement.
Chagas could have been sentenced to up to 30 years in prison for killing Jonathan Silva Vieira, but Judge Marcio Castro Brandao took account of testimony from psychologists that Chagas suffered from a mental disorder and was not completely in control of his actions, the court said.
I'd say that makes him more dangerous, not less, but hey.... His victims were only kids, and after all, everyone of those brats was just walking around exhaling CO2, and messing up the world.

Bet this guy's gonna claim the ol' "suffering from a mental disorder" thing too. Frankly, this involves a dead. rotting dog, a man's romantic involvement with the dog, a concerned call from a daycare center worker, and I just don't want to quote it here.

Pity our teachers. Because hey, suspending a fourteen year-old (who admitted to involvement in a drive-by shooting) from school just shouldn't be automatic these days, now should it? That would be a violation of a kid's constutitional rights, now wouldn't it? The kid has a right to an education, now doesn't he?

To close out in Australia, one mufti has figured out who is responsible for rapes and all that sort of picayune stuff. Of course, it is not the rapist:
Sheik Hilali said there were women who "sway suggestively" and wore make-up and immodest dress ... "and then you get a judge without mercy (rahma) and gives you 65 years".

"But the problem, but the problem all began with who?" he asked.
Without mercy? The Koran's penalty for adultery is death.... Give 'em credit, the Australian Muslim women aren't too happy to hear this. An earlier pronouncement might have riled them a bit:
In the religious address on adultery to about 500 worshippers in Sydney last month, Sheik Hilali said: "If you take out uncovered meat and place it outside on the street, or in the garden or in the park, or in the backyard without a cover, and the cats come and eat it ... whose fault is it, the cats or the uncovered meat?

"The uncovered meat is the problem."

The sheik then said: "If she was in her room, in her home, in her hijab, no problem would have occurred."

He said women were "weapons" used by "Satan" to control men.

"It is said in the state of zina (adultery), the responsibility falls 90 per cent of the time on the woman. Why? Because she possesses the weapon of enticement (igraa)."
The weapons of mass enticement are our boobs, ladies. Flash a mufti today, and watch him absquatulate in terror. Your mission is to use that word in conversation or in a written sentence today. Do not fail, or the Satanic weapons of mass enticement will hunt you down! You have been warned!

Wednesday, October 25, 2006

RE: September Existing Home Sales

I have been staring at these figures for hours in shocked dismay. NAR can pontificate all it wants about "easing", "dipping" and "stabilizing", but what this shows is that this plane is losing altitude very, very fast. These are very negative reports you can get here. The word "dire" comes to mind; read on.

NAR is banging the drum on inventory, but months of supply are not dropping, which is the figure that matters. Furthermore, newly built homes coming on the market haven't stabilized yet, and won't for five or six months (and many of these are not listed on the MLS). Additionally, many cash-strapped sellers are trying FSBO and aren't using the MLS, and finally, NAR has been pushing hard to try to get sellers who aren't willing to negotiate to withdraw listings with the promise that it will all be better by spring. So sitting at 7.3 months of inventory nationally is not a "stabilization" - it's a reflection of an intractable reality, which is that we have a demand/supply imbalance not easily corrected. (Months of inventory for August were revised downward to 7.3, so months of inventory haven't dropped.)

The year over year sales and price declines are accelerating and it's a widespread pattern.
Comparing August 2006 sales to August 2005 sales (non-seasonally adjusted):
National: -12.0%
Northeast: -11.7%
Midwest: -11.2%
South: -6.8%
West: -21.6%
Comparing September 2006 sales to September 2005 sales (non-seasonally adjusted):
National: -16.3%
Northeast: -15.4%
Midwest: -16.3%
South: -11.2%
West: -25.4%
Now on to median prices for all homes combined. This is where it gets rough and ruthless. First, NAR revised its August figure down from 225,000 to 224,000. Second, the price declines are picking up fast:
Comparing August 2006 median sale price to August 2005 median sale price:
National: -1.7%
Northeast: -3.9%
Midwest: -1.1%
South: -2.6%
West: +0.3%
Comparing September 2005 median sale price to September 2006 median sale price:
National: -2.2%
Northeast: -5.1%
Midwest: -2.3%
South: -1.6%
West: -4.3%
This is a very fast decline, and reflects severe underlying weakness. Worse, the price declines are highest in the priciest regions with the best income increases. This means that overall equity loss is much higher than you would expect from looking at the national figure decline.

If you contemplate at the national figures broken out by single family and condos, things look even worse. The median sales price reported for both was $219,800. Single family median prices by region show no bright spots compared to September 2005:
National: -2.5% ($219,800)
Northeast: -6.7% ($265,200)
Midwest: -2.4% ($167,300)
South: -2.2% ($183,500)
West: -3.1% ($341,200)
Now for the truly ugly: Condo median prices by region compared to September 2005:
National: -2.8% ($219,800)
Northeast: -1.3% ($244,400)
Midwest: -0.1% ($189,600)
South: -2.3% ($183,600)
West: -12.4% ($251,900)
!!!!!! Look at the western condo median price and the northeastern single family median price. Believe me, "automated valuation systems" just got junked. What you are seeing here is the pancake effect that occurs only in severe housing declines. Imagine housing in an area separated into five tiers in terms of desireability, ranked from 1 being least desireable to 5 being most desireable. In the pancake, the middle tiers rapidly approach each other in price, which causes the lowest tier to plummet in pricing. The reason is that with relatively little price separation, most people buy on a tier higher than they would have previously, and the market for the lower tier falls off a cliff.

This is happening incredibly quickly. There will be no recovery next spring, because these types of price declines combined with the poor credit quality of the loans originated this year will force appraisal standards to go up and credit tightening next year. A lot of people will be walking away from interest-only condo loans, believe me.

Btw, the homebuilder third quarter reports are coming in, and they ain't pretty either. This mule was always cantankerous, and now it just stopped in its tracks and will not be beaten forward.

The Last Holdout?

Once a month I scroll through HousingTracker, which tracks real estate listing prices and inventory for metro areas around the country. It takes a few months after the market turns sour for listing prices to go down, but once the reality sinks in, these are not bad proxies. Usually you will see the inventory start to rise for a few months at list before the listing prices drop.

Anyway, it looks like the last good market is Raleigh-Durham. Inventory is not up significantly there yet, so they have at least a few more months. The overall mix of jobs, prices, demographics and local government sanity index in this area is just about the best in the country. It will stall out next year some time when the recession really hits, though. Whether it stalls out or actually drops might almost serve as a proxy for the entire nation's future in 2008. If, by the end of 2007, Raleigh-Durham's pricing has managed not to drop more than 2% from the beginning of 2007, there will be some light at the end of the tunnel. If it goes much below that, don't look for a recovery until late 2009 at the earliest.

Salt Lake City seems definitely to have crossed over. It was extremely, extremely hot, and is now on the downside of that curve. Inventory is up nearly 60% over the last six months and prices have begun to drop.

Austin has been strong, but may be tipping over. It's too soon to know for sure, but it does appear to have stalled. It looks like we'll know in mid-December. As I have tracked these markets over the last year, the MTBF has dropped sharply. In the first ones to slide, it took nearly a year of higher inventory to generate pricing drops. Now it's more like 4 months in the last few. It is clear that the market will not recover next year.

I'm waitiing for the existing home sales breakdown for September to be released. Nationwide, the median home price dropped 2.2% compared to September 2005. But that's not surprising. The meat and potatoes is in the regional figures and the condo/single family figures. There is a mild pleasure in watching NAR's nonsense eddy and swirl from month to month. This is last month's press release:
WASHINGTON, September 25, 2006 -

Existing-home sales stabilized at a sustainable pace in August, while home prices showed an anticipated decline, according to the National Association of Realtors®.

Total existing-home sales – including single-family, townhomes, condominiums and co-ops – slipped 0.5 percent to a seasonally adjusted annual rate1 of 6.30 million units in August from a level of 6.33 million Ju1y, and were 12.6 percent lower than the 7.21 million-unit pace in August 2005, which was the second highest on record.

David Lereah, NAR’s chief economist, said home sales appear to be leveling out. “After a stronger-than-expected drop in July, the fairly even sales numbers in August tell us the market is at a more sustainable pace,” he said. “It keeps us on track to see the third highest sales year on record, but we do expect an adjustment in home prices to last several months as we work through a build up in the inventory of homes on the market.”
Needless, to say, the idea of "stabilization" is already contradicted by this month's facts about sales in September:
The pace of existing home sales fell for the sixth straight month in September, hitting a 6.18 million-unit annual rate, according to a report from the National Association of Realtors on Wednesday that was a sharper drop than economists expected.

Year over year, U.S. home prices fell 2.2 percent to $220,000.
The $220,000 median is about what I expected ($5,000 below September 2005's median). The sales are slightly lower than I expected, but only slightly. I am really on tenterhooks waiting for the detailed information, because this is the test of my demographics model. Relatively, I am expecting the midwest to be dead, the northeast to be up somewhat on bargain hunting, the west to be in condos, and the south to have fallen.

Tuesday, October 24, 2006

All About Reality

I have written before about my perception that there will be no easy settlement in the culture wars in the US. Unlike others, I don't see Muslims as being the problem. Muslims in the west are merely a proxy for the cultural abyss which separates adherents of two opposing philosophies.

The first philosophy is grounded on the idea that absolute reality does not exist, and the second philosophy is grounded on the idea that absolute reality does exist, and that this absolute, objective reality logically makes imperative claims against the individual.

See Dr. M's excellent post in which she describes expressing her support to a military officer she encountered on a Disney cruise:
Then I said, "You know, don't believe what you read in the newspapers and hear on the news. We Americans are behind you 100% and believe in what you're doing. We are so thankful. So, thank you."

I was a little embarrassed to say something. Soldiers must feel like celebrities these days. He was on a ship for much deserved R/R after two tours in Iraq. I didn't want to bug him. But I wanted him to know, you know?
Yes, we know. That is, those of us on this side of the philosophical abyss do. Dr. M continues to ponder the bizarre attack on the American military, which is by far and away the most successful institution in our society and instills in military personnel ideals of justice, equality, duty, self-sacrifice, honor, not claiming more than your due, and self-restraint:
Because of the Left's own unresolved authority issues, they cannot, will not ever embrace power used to enforce an action. They hate the military. They hate soldiers. They hate authority. They hate the notion that there is a right or wrong. They hate the notion that the U.S. might be the enforcers of right and wrong when so many injustices are imbedded into the fabric of American society. Really important things like the pushback against Gay Marriage and Abortion, for two examples. Wrong takes on such important social issues prove, without a doubt, that average Americans are stupid rubes intent on killing anyone who doesn't see things like them.
This, I think, is accurate. The bulk of the military is constituted of those who literally live out the second philosophy, because their purpose and guiding rule is to defend and serve the greater life of our nation, even at the cost of their own lives. Naturally, the exponents of the first philosophy detest them. They detest them personally and as a culture. They fear them, and they revile them.

The NY Times is an example of a cultural institution dominated by the adherents of the first philosophy. Those who adhere to the first philosophy don't believe that an external reality to which we must conform exists. On the contrary! They believe that every individual has the right to make claims against that reality when it impacts the individual, even if it is the individual's own actions that have created the individual's poor circumstances - because it is unfair that life should treat them that way! As an example, you will still find leftists blaming Ronald Reagan and the Pope for AIDS.

Betsy Newmark wrote a post about the NY Times' ombudsman's admission that the NY Times made a mistake when it publicized the program to trace terroristic financing this summer. Betsy aptly skewers the explanation for the mistake:
...there still haven’t been any abuses of private data linked to the program, which apparently has continued to function. That, plus the legality issue, has left me wondering what harm actually was avoided when The Times and two other newspapers disclosed the program. The lack of appropriate oversight — to catch any abuses in the absence of media attention — was a key reason I originally supported publication. I think, however, that I gave it too much weight.

In addition, I became embarrassed by the how-secret-is-it issue, although that isn’t a cause of my altered conclusion. My original support for the article rested heavily on the fact that so many people already knew about the program that serious terrorists also must have been aware of it. But critical, and clever, readers were quick to point to a contradiction: the Times article and headline had both emphasized that a “secret” program was being exposed.
by citing Daily Pundit's response:
You let your ingrained hatred of everything not nakedly leftist - including the Bush administration - govern your thoughts and actions, as do almost all employees of the New York Times.

This is an especially telling admission from the Times "ombudsman," who, in theory at least, is supposed to be the most objective journalist in the Times organization. But a "vicious criticism" (what? did GWB forget to call you the world's greatest newspaper?) is enough to warp your objectivity enough to print a story that did major damage to the safety and security of the United States?
Exactly, and let's not forget that the weapons being used to fire into Israel from Gaza, the West Bank, and Lebanon, to detonate bombs among the civilian population of Iraq and to attack our soldiers and the Iraqi soldiers cost money! The NY Times put itself squarely in the enemy camp with this one.

Why? Why does the NY Times consistently serve as a stage for enemy propaganda? Because it hates the enemies of this enemy, that's why. That's the only reason. There are plenty of people with leftish and libertarian views, like Nat Hentoff, who are perfectly able to criticize the administration and make their political points without feeling the need to become the Pravda of Hamas, Hezbollah and Al-Qaeda. As David of Photon Courier wrote in response to Betsy's post:
Note his phrase "my instinctive affinity for the underdog." In reality, of course, The New York Times is a powerful corporation. Its editorial policy is set by people of considerable inherited wealth, people who appear to consider themselves as members of some kind of permanent ruling class. Underdogs?

I think the real underdogs here are the Americans, Iraqis, Israelis, and others who may be killed or crippled because of tne NYT's irresponsible posture.
Exactly, although "irresponsible" is putting it too lightly. A person very close to me just spent a week at Fort Benning training, and came away grieved by the painful reality that, as he put it, "We are sending the very best we have to die, and no one cares". But we do care. We care. We grieve over it. But while serious people may disagree over whether the deposing Saddam Hussein was the right policy, serious people cannot disagree that we must oppose this wave of Islamic totalitarianism just as we opposed Communism's rapid mutation into a vicious, destructive ideology and we opposed the fascist conquerors in Europe. Some philosophies simply are incompatible with each other; they cannot coexist. Nor can people put on the hat of humanism and justify ignoring oppression and mass murder in Iraq, Darfur, North Korea and multiple other countries.

The NY Times' philosophy is incompatible with the nation's philosophy, and it knows it. It views the guiding philosophy of the American people with far more fear and distaste than it does the Islamists who burn, bomb, torture and kill with divine assurance. The NY Times represents a decadent, self-destructive American elitism at war with the life of this country.

In "Of Gold And God", SC&A takes on that elitism directly:
Our own cultural biases towards non belief are the result of the secularist notions. Freedom from religion is preferable to freedom of religion. Secularists will argue and point to an unforgiving and oppressive God- exactly the kind of God that no longer exists in the Judeo-Christian ethic (it bears noting that the Islamic fundamentalist idea of Allah is exactly like the kind of religion to which secularists are so opposed- violent, malevolent and oppressive. That said, there are few is any progressive secularists that will confront that reality). It is precisely because the Judeo-Christian belief system is so unlike what the secularists believe, that religion is thriving. They cannot ‘argue’ a believer out of his or her faith, so they resort (to) a legal system that accommodates their biases against religion.
Why? SC&A answers the question:
Non believers would argue that belief in God is a kind of crutch- and it is in that argument that we can see that they do not understand the meaning of ‘faith in God.’ In fact, real faith is assuming a burden, obligations that would otherwise be ignored. The Jewish notion is particularly illustrative- it is one of assuming ‘the yoke of Heaven.’

With real faith there is no respite from those obligations. In fact, the obligations and ‘ascent’ are unrelenting. There is a never ending field that must be plowed so that who follow the believer will find spiritual nourishment and meaning. There are no vacations from the obligations believers assume.
Exactly. This is the philosophy, the essential stance, that the NY Times finds so dangerous. It concentrates on destroying this idea, which their philosophy finds terrifying. They do not fear the bombers and the destroyers - they fear us. They fear those who believe that there is an absolute, external reality which has the right to make individual claims upon us which will mandate self-sacrifice. Traditional atheism in the American culture has denied the existence of a God, but not has not denied the existence of an external reality or the concept that recognizing an external reality imposes obligations on us individually.

The new philosophy of "secularism" has come to adopt the idea that reality, if it is uncomfortable, can be changed. Of course, it cannot. And of course, reality will often be very, very uncomfortable. Yet it will continue to exist, and the sum of our individual inabilities or abilities to recognize reality and to respond to it well ultimately governs the life and success of all cultures. This new secularism is also at war with traditional American atheism.

SC&A's post merits reading and rereading, but for now I want to cite a comment in response to the post from one Ryotto:
Life is not meaningless to the secular tribe. In fact, life on this earth is what matters most.

Unlike the religious tribe, who will mindlessly vote for anyone who wears his religion on his sleeve, no matter how disastrous his policies are, the members of the secular tribe are concerned about what kind of place we will leave to future generations. Will we leave them an overpopulated, polluted Earth which is dominated by the greed of big business and has little regard for the individual, or will we leave them an Earth which is better than the one we were given?
For some secularists, Ryotto's point is true. These are the traditional atheists who do recognize duty toward others. But it is obvious that Ryotto doesn't recognize this duty, because the first duty of all those who do believe in external reality is to recognize that reality as well as they can. When Ryotto must continue on to describe the "religious tribe" this way...
To the religious tribe, it really doesn’t matter, as long as they can spend eternity floating around in some kind of imagined paradise.
... it becomes obvious that Ryotto has a problem with reality. It takes a stunning amount of willful blindness not to realize that the commands of faith are almost purely directed toward our obligations toward other human beings, and not to recognize the historical role that these commands have played in the life of our nation. Abolition, emancipation of women, child-labor laws, the progressive era fighting for just compensation for working-class men and women - all of these movements were initiated by religious people. The churches and synagogues spawned the hospitals, nursing homes and charities then, and they still do now.

When you must resort to lies to make your point, you have no point. Just as every atheist is not trying to avoid reality, it is fact that most religious people are responding to the reality that they see and experience, and that the Ten Commandments still have place in the life of this country because they still accurately tell us something about the results of our actions over time.

Does lying, stealing or cheating work? Does abusing or ignoring your parents work? Properly understood, "sin" in the Judeo-Christian tradition means denying reality with your actions, a.k.a. doing things that seem wonderful right now, but do not work out over the long term. Isn't "...punishing children for the iniquity of parents, to the third and the fourth generation of those who reject me" an apt description of what we are seeing in our society from those who have romped off on the path of self-fulfillment while ignoring their responsibilities to others? Change "God" to "the real world", and can any atheist not at war with reality deny that these rules are still basic requirements for a workable society?

It is also a fact that the US press is dominated by an elite that has little contact with reality and wishes to preserve that circumstance, and that it represents the true life of the American people not at all. It is a froth destined to be swept away by the currents of history and reality. I will not mourn its passing.

Shrinkwrapped wrote in a puzzled fashion last year that he could not understand why he found many religiously-oriented bloggers more thoughtful and reality-oriented than the secularists. In "Talking 'bout My Generation" he takes another look at what the denial of personal responsibility has wrought:
Children who are raised to believe the sun rises and sets for them are loathe to risk their own comfort for anything that does not directly threaten them. After all, since the ascendancy of the left among the Western elites, the idea that there could exist anything more important than the attainment of one's personal happiness (usually confused with the pursuit of pleasure and material accumulation) has been accepted as the only sine qua non for a just society. The heightened Narcissism of my generation is the substrate upon which so many of our troubles rest, which is why I write about it so often.
Yes, SW, we've noticed. We've also noticed that Dr. Sanity seems to be banging the same drum. It does not surprise me that those who have chosen the profession of trying to help others live functional lives would end up squarely in the middle of reality. It does still surprise me that the NY Times would chose to connive at its own destruction rather than admit that a painful, personally impinging reality does exist, but it really shouldn't. After all, if God had to show up to explain:
A. Reality really exists, and isn't going to change for you, and
B. Doing the same thing over and over again is going to work out the same way over and over again, and,
C. Doing the same thing over and over again and expecting a different result is insanely stupid,
then the human capacity for self-delusion is clearly a nearly overwhelming force in any human society.

The reason why monotheism became such a stunning force in human history is that appealing to G_d or gods is seen as a contract among humans. We appeal to powers or principalities in order to get reality to work out in a way favorable to ourselves, and when we must appeal to the same power, we must acknowledge that one and only one universal contract exists. Consequently, the contractural rules must constrain us all and be the same for us all. In this recognition, a society finds peace and prosperity, even if the individuals composing the society do not necessarily find escape from their personal devils.

Which brings me back to SC&A's starting point, as he quotes Dineesh D'Souza:
...imagine two groups of people — let’s call them the Secular Tribe and the Religious Tribe — who subscribe to one of these two views. Which of the two is more likely to survive, prosper and multiply? The religious tribe is made up of people who have an animating sense of purpose. The secular tribe is made up of people who are not sure why they exist at all. The religious tribe is composed of individuals who view their every thought and action as consequential. The secular tribe is made up of matter that cannot explain why it is able to think at all.
But Dinesh understates his case. The secularist tribe so exquisitely embodied by the NY Times is a tribe that denies not only reality but all possibility of developing any understanding of reality. In doing so, it becomes incapable of any rational thinking at all, as is demonstrated by the genuinely hilarious explanation of the NY Times' "reasoning" by its ombudsman:
My original support for the article rested heavily on the fact that so many people already knew about the program that serious terrorists also must have been aware of it. But critical, and clever, readers were quick to point to a contradiction: the Times article and headline had both emphasized that a “secret” program was being exposed.
Exactly, but one does not have to be "clever" to realize that the NY Times was and is idiotic and hypocritical. When you are driven by your private, unadmitted purposes to making a fool of yourself in print in this manner, you really cannot afford to be publishing wordy screeds about the problem with Kansas. To paraphrase someone important, first get the beam out of your own eye, and then you can see to remove the motes from the eyes of the citizens of Kansas.

However I am quite sure that the NY Times will not be able to see it this way, and I am afraid that Shrinkwrapped was prophetic in writing:
If the Democrats win the mid-term elections, they are likely to cause great grief to our ability to fight against an implacable enemy. Yet, if they lose, again, I fear for their rage and despair. It is when the external world shows its indifference that the Narcissist is most at risk for existential despair.
The NY Times is now occupying that trough of existential despair. With every position cut, the elite becomes more desperate, vengeful and spiteful. You can look confidently to them for additional Fifth Column pro-terror wars of words. After all, they are pretty sure that Osama Bin Laden does want to kill Bush, and could that truly be a bad thing? Not according to the Grieving Old Hag that the NY Times has become, whose self-portrait is here.

Monday, October 23, 2006

Bubbles, Fixing To Pop

Casey's on the ball and Dean is going mean for green. Ya wanna know who makes money in down RE markets? Sharks & swindlers. My guess is that Rich Dad is a shark, which means Casey is chum. Or you can go into the auction business. SDCIA's troll thread is getting action from regulars posting comments like:
I spoke at the Inland Empire Investment Club on Sept 26, 2006.
A couple of investors told me that housing prices for Temecula had dropped by 10-12% in the past 3 months.
I have already seen a 15% decrease in entry level condos in Palm Springs. This is a very different number that what the NAR seems to think it is, but what do I know.
I would like to continue investing in real estate but I don't believe anyone can make money in the real estate market right now. I can't wait till prices come down to the point that purchasing property is an investment.
About 18 percent of all mortgages issued in the first half of the year were to borrowers considered most likely to default, such as those with high credit-card balances, up from 2.4 percent in 1998, based on data from the Mortgage Bankers Association.
Be careful if you have a low mortgage balance; I have been hearing things about servicers trying to make their accounts more profitable. Check your statements and make sure your payments are being applied correctly. Also, don't believe anything you get from a lender on your housing value. Some of these "automated valuation systems" are producing stratospheric estimates - which does explain a lot. When I say "stratospheric", I mean 30-45% overvaluations.

The Housing Bubble Blog continues to have a good roundup of RE stories. You have to read about 16 or 17 of them to get the full impact of having very negative facts explained in a very positive way. It's a brave new world of American real estate, exemplified by predictions of future price drops less than the price drops that have already been reported. For example, from the Bloomberg cited article above:
Even with the gains, the National Association of Realtors this month predicted prices of new homes may fall for the first time in 15 years. The trade group on Oct. 11 estimates that the median price of a new U.S. home probably will drop 0.2 percent to $240,500.
The New Homes report released in September by the US Census had the median new home price at $237,000:
The median sales price of new houses sold in August 2006 was $237,000; the average sales price was $304,400. The seasonally adjusted estimate of new houses for sale at the end of August was 568,000. This represents a supply of 6.6 months at the current sales rate.
From my point of view, all of this has taken on a fascinating surreality. The fact remains that prices are falling over most of the country, and that with this many months of supply on the market, prices can't rise. There is a huge amount of statistical uncertainty in those Census figures, but the Purchase Money Index from MBA is a strong statistic. The best place to track it is on Hanley Wood because they give a year over year comparison and their latest is:
...the MBA’s seasonally-adjusted Purchase Index increased slightly to 384.7 from 383.3 the previous week. The latest number is up just 0.37 percent from last week but down 23.66 percent from the same period a year ago. This is the second straight week the purchase index has remained below the 400 level mark.
And the four week moving average declined. There was a brief uptick in September, but now it's gone.

About the signficance of that 18% statistic cited by Bloomberg? It indicates that 2007 should be a very, very interesting year indeed, because these loans are already showing high delinquency rates compared to historical averages. MBA's delinquency measures summary from September shows just how segmented the risks are in this market:
Compared with the second quarter of 2005, the delinquency rate increased 51 basis points for prime ARM loans and 220 basis points for subprime ARM loans. The delinquency rate decreased 2 basis points for prime fixed loans, while the delinquency rate for subprime fixed loans increased 17 basis points.
220 basis points equals 2.2%. However, the second quarter was too soon to see the full impact of a tightening market. We will see the full effects early next summer in these figures. Three months (one quarter) in a down housing market is a very, very long time indeed. Second quarter delinquency rates hadn't increased significantly, although the higher subprime origination rates mean that next year we are doomed to see a rise in delinquencies. Delinquencies are concentrated in subprime and adjustable rate loans:
All adjustable rate (ARM) loans had higher SA delinquency rates compared to the first quarter of 2006. Fixed rate mortgage loans (FRM) were either unchanged or saw a decline in delinquencies. The SA delinquency rate for prime ARMs increased 40 basis points (from 2.30 percent to 2.70 percent) and the rate for prime FRM loans was unchanged (at 2.00 percent). The rate for the subprime FRM loans decreased 38 basis points (9.61 percent to 9.23 percent), whereas the rate for subprime ARMs increased 22 basis points (12.02 percent to 12.24 percent).
The comparisons above are to the first quarter, not 2005. The problem is that the quality of the loans originated has been plummeting, and now the borrowers will usually be unable to sell out of delinquency (because they can't clear enough to pay their debt), so the underlying delinquency rate will now stay in the portfolio and escalate, whereas in prior years it didn't. Anyone who can is refinancing into fixed or better loans, so the quality of the remaining ARMs is getting worse.

2007 is going to make 2006 look like a fond memory; 2006 was largely the product of the speculators stopping their wave of purchases. That produced a pretty consistent 20% year over year decline in purchase money apps during the last six months and the beginning of price declines. It will also produce an economy running near stall speed by the beginning of 2007 with pockets of definite recession. Moving into 2007, we will see the beginning of widespread credit tightening, a slower job market, localized high unemployment rates, a demographic panic as the 60 and over crowd try to figure out how to escape high property tax rates in the wealthier sections of the country, and a slowly increasing recession. We will end 2007 with higher unemployment I am guessing will be reported as somewhere near 5.3% (our unemployment rate is beginning to be masked by the demographics, workers 60 and over simply retire), and a set of unattractive options, especially at the blue state and local level.

Of course, all of this carries with it an increased risk of attacks by splodey dopes of the Islamic variety who will hope to exploit our problems. Whether the recession will be easing or deepening in 2009 will depend on our public policy. If we cannot develop healthy investment in the US, things are going to get ugly. This moving from one bubble to the next cannot continue, but there is underlying strength in the US economy that is not being exploited. The real cause of all these bubbles is a lack of profitable longterm investment options, causing money managers to stampede from one crest of the wave onto the next rise. Being better at knowing when to get off the risk boat than the average guy does not lead to the types of investments that build an economy.

If we could unload the worst excesses of our environmental public policy, we could begin to redress our trade imbalance very quickly by building power plants of all varieties and drilling for oil. This recession will be a consumer-led recession combined with a great capital reserve in the portfolios of the boomers. If their assets could be invested in new construction, we could emerge from the other side of this in much better fundamental economic shape. If we don't change our policies, things will become grim indeed by 2012.

Sunday, October 22, 2006


Hamas is shocked and surprised that it has been the subject of so much international hostility. Imagine that.
In a candid article published in the Palestinian press, Ahmed Youssef, a political adviser to Prime Minister Ismail Haniyah, a Hamas leader, said the group had been shocked by the strength of opposition to its electoral victory. “It went beyond all imagination,” wrote Youssef. “The government ... did not expect the pressures and the siege imposed on our people would be so harsh, so strong and so large in scale.”
Could it have anything to do with Hamas' expressed goals? There is a long history here. 1993 FAS (introduced to the house by Chuck Schumer, btw):
Hamas, as it is currently organized, was founded in December 1987 just when the intifada (uprising) in the occupied territories was starting. The Hamas agenda is based largely upon the principles of Islamic fundamentalism that were gaining momentum throughout the Arab world at that time. The goal of the founders was to become directly involved in the intifada and ultimately gain control of the Palestinian movement and bring it more in line with fundamentalist Islamic thought.
Hamas has apparently staked much of its reputation on the fate of the peace talks, apparently believing that a breakdown or perceived failure of the talks would propel Hamas into the leadership of the Palestinian movement.
Hamas relies heavily upon its use of violence. This is clear from the content of pamphlets regularly distributed throughout the occupied territories since the first month of Hamas existence. The pamphlets include statements such as: `increase attacks with knives, grenades, and guns against the cowardly Jews in their houses and turn the day into darkness and the nights into intolerable hell * * * view every Jewish settler as a target to be killed, whose blood and money are for the taking.'
Hamas also admits to having executed Palestinians accused of collaborating with Israeli authorities. A transcript of a training film allegedly made last summer by the Qassam Battalions tells how Hamas operatives kidnapped Palestinians accused of collaboration and then forced confessions before executing them.
There is added concern on the part of U.S. policymakers because of reports that Hamas is receiving support from Iran and is collaborating with its Lebanese client, Hizbullah. 23 The Hamas representative in Iran denied the PLO allegation that it had received $30 million from Iran in 1992, but he acknowledged Iranian assistance to `Palestinian groups.' There are few particulars about Hamas collaboration with Hizbullah; the inference is that Hamas militants have been given refuge in southern Lebanon where they receive training and support from Hizbullah guerrillas.
Hamas and Hezbullah are still cooperating. Hamas also supported Iraq in the Gulf War. One of the founding principles of Hamas (just like Hezbullah) is that any Muslim who does not participate in total war against Israel is a traitor:
'Egypt was, to a great extent, removed from the circle of struggle [against Zionism] through the treacherous Camp David Agreement. The Zionists are trying to draw other Arab countries into similar agreements in order to bring them outside the circle of struggle. ...Leaving the circle of struggle against Zionism is high treason, and cursed be he who perpetrates such an act.'
Among the enemies of Hamas are Rotary Clubs (read this, if you read nothing else, because it is Hamas speaking of Hamas):
Article Seventeen: The Role of Muslim Women
The Muslim women have a no lesser role than that of men in the war of liberation; they manufacture men and play a great role in guiding and educating the [new] generation. The enemies have understood that role, therefore they realize that if they can guide and educate [the Muslim women] in a way that would distance them from Islam, they would have won that war. Therefore, you can see them making consistent efforts [in that direction] by way of publicity and movies, curricula of education and culture, using as their intermediaries their craftsmen who are part of the various Zionist Organizations which take on all sorts of names and shapes such as: the Freemasons, Rotary Clubs, gangs of spies and the like.
Here's a few more excerpts:
Article Twenty-two:
The enemies have been scheming for a long time, and they have consolidated their schemes, in order to achieve what they have achieved. ... They stood behind the French and the Communist Revolutions and behind most of the revolutions we hear about here and there. They also used the money to establish clandestine organizations which are spreading around the world, in order to destroy societies and carry out Zionist interests. Such organizations are: the Freemasons, Rotary Clubs, Lions Clubs, B’nai B’rith and the like. All of them are destructive spying organizations. ... they stood behind World War I, so as to wipe out the Islamic Caliphate. ... the Community of Unbelief is one.
Article Thirty-Two: The Attempts to Isolate the Palestinian People
World Zionism and Imperialist forces have been attempting, with smart moves and considered planning, to push the Arab countries, one after another, out of the circle of conflict with Zionism, in order, ultimately, to isolate the Palestinian People. Egypt has already been cast out of the conflict, to a very great extent through the treacherous Camp David Accords, and she has been trying to drag other countries into similar agreements in order to push them out of the circle of conflict. Hamas is calling upon the Arab and Islamic peoples to act seriously and tirelessly in order to frustrate that dreadful scheme and to make the masses aware of the danger of coping out of the circle of struggle with Zionism. Today it is Palestine and tomorrow it may be another country or other countries. For Zionist scheming has no end, and after Palestine they will covet expansion from the Nile to the Euphrates. Only when they have completed digesting the area on which they will have laid their hand, they will look forward to more expansion, etc. Their scheme has been laid out in the Protocols of the Elders of Zion, and their present [conduct] is the best proof of what is said there.
Article Five: Dimensions of Time and Space of the Hamas
As the Movement adopts Islam as its way of life, its time dimension extends back as far as the birth of the Islamic Message and of the Righteous Ancestor. Its ultimate goal is Islam, the Prophet its model, the Qur’an its Constitution. Its special dimension extends wherever on earth there are Muslims, who adopt Islam as their way of life; thus, it penetrates to the deepest reaches of the land and to the highest spheres of Heavens.
Article Eight: The Slogan of the Hamas
Allah is its goal, the Prophet its model, the Qur’an its Constitution, Jihad its path and death for the case of Allah its most sublime belief.
Article Eleven: The Strategy of Hamas: Palestine is an Islamic Waqf
The Islamic Resistance Movement believes that the land of Palestine has been an Islamic Waqf throughout the generations and until the Day of Resurrection, no one can renounce it or part of it, or abandon it or part of it. ... This is the status [of the land] in Islamic Shari’a, and it is similar to all lands conquered by Islam by force, and made thereby Waqf lands upon their conquest, for all generations of Muslims until the Day of Resurrection. This [norm] has prevailed since the commanders of the Muslim armies completed the conquest of Syria and Iraq, and they asked the Caliph of Muslims, ‘Umar Ibn al-Khattab, for his view of the conquered land, whether it should be partitioned between the troops or left in the possession of its population, or otherwise. Following discussions and consultations between the Caliph of Islam, ‘Umar Ibn al-Khattab, and the Companions of the Messenger of Allah, be peace and prayer upon him, they decided that the land should remain in the hands of its owners to benefit from it and from its wealth; but the control of the land and the land itself ought to be endowed as a Waqf [in perpetuity] for all generations of Muslims until the Day of Resurrection. The ownership of the land by its owners is only one of usufruct, and this Waqf will endure as long as Heaven and earth last.
The Islam of Hamas, the Muslim Brotherhood, Hezbullah and Al-Qaeda is not a religion but a political creed. Their goal is the recovery of political control of all lands once possessed by Islamic regimes, and they believe that they can only achieve this by unifying all Muslims against any who would oppose that goal. Spain is also Waqf, for example. Furthermore, all lands in which Muslims reside should be absorbed into Islam, and peaceful relations between members of other religions are only permitted when and if members of those other religions are living under the political control of an Islamic regime.

In other words, that 70% of the American population which believes that we are occupied in a long war against Islam is correct. See Shrinkwrapped's post "Don't Kill The Messenger". It's just that our opponent is one branch of Islam, and a very political one at that. Not only that, the core beliefs of this branch of Islam are that of a murderous cult, and as soon as it gains power anywhere it is doomed to foul its own nest. Shrinkwrapped is right, and so are SC&A, Dr. Sanity and The Anchoress. Oriana Fallaci and George Bush are messengers telling the tale the liberal, academic, journalistic elite can't stand to hear. Unfortunately for the current Democratic party, which has abandoned its own roots, the rest of us have heard their message and believed. The 30% of the American population which doesn't believe that we are in a genuine and unavoidable clash with the Islamic totalitarianism is the 30% of the American population that's ignorant, mentally unbalanced, or delusive.

When, as a party, you must pin your hopes of winning elections on the idea that the majority of the population is ignorant, mentally unbalanced or delusive, you are not planning to win elections. After all, for everyone who's not mentally unbalanced or delusive, ignorance is a temporary condition that automatically redresses itself. So even if the Dems win this one, they cannot win the next election. I strongly suspect that they don't want to win it either. The strategy they're following is the worst possible one. I think they are afraid to win an election, because then they'd have to bear some responsbility for public policy.

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