Housing Prices Continue To Blow Sky High

The LA/Orange County real estate market continues to burn white hot, and in fact nation-wide housing prices are continuing to rise at break-neck, and wallet-breaking, speeds:

Case-Shiller’s report showed house prices up 6.3 percent nationally in February and up 6.8 percent in its 20-city composite index.

Seattle, Las Vegas, and San Francisco lead the 20-city index with double-digit price gains. Prices were up 10.1 percent in San Francisco and 7.6 percent in San Diego. The Inland Empire isn’t included in the 20-city report.

Home prices continue to go up, up, up,” Realtor.com Chief Economist Danielle Hale said in a statement issued in response to the Case-Shiller data.

Meanwhile, as traditional mortgage rates rise, people are turning back to those nasty adjustable rate mortgages:

But according to the most recent Origination Insight Report from Ellie Mae, it seems that may be changing. This March, ARMs accounted for 6.3% of all mortgage loan originations—their highest share since October 2014.

Rising interest rates on fixed loans are the biggest reason ARM originations are rising. Because ARMs typically offer a lower initial rate up front than fixed-rate mortgages (FRMs), they’re able to save buyers hundreds or even thousands of dollars on their purchase.

Meanwhile over in Canada, which is dealing with the beginnings of a housing bubble, the alarm bells are going off as people who pulled cash out of their home are getting squished by rising interest rates:

A recent Globe and Mail story on the dangers of credit lines said that clients of the Big Six banks had borrowed a record $207-billion using HELOCs as of Oct. 31. TD was the dominant bank in the group – its HELOC balance at Oct. 31 was $73.4-billion.

HELOCs are the smartest way to borrow for expenses you need a little time to pay off. But low interest rates have drawn some people into a dependence on HELOC borrowing to sustain their lifestyle or buy extras they can’t otherwise afford. There’s growing concern about how people will manage all their debts, HELOCs included, as interest rates move higher.

It seems like the big difference this time around is that mortgage lenders are only lending to people who can really afford what they are buying.  But with the price of housing completely outpacing income, where exactly are all these customers who can “afford” these extremely high priced homes coming from?

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Trump Financial Meltdown?

As Quartz reports, usually a roll back in regulation and less oversight lead to the next financial meltdown.  With news that Trump will now use the Consumer Financial Protection Bureau to protect predatory lenders, it seems we are in the slash and burn phase, with the meltdown phase to follow. The only question is when?

The blame for financial meltdowns often focuses on irresponsible traders and greedy bankers. But politicians, whose policies sometimes fan the flames, deserve scrutiny as well, according to a fascinating analysis of booms and busts since the 18th century by Jihad Dagher, an economist at the IMF. The research serves as a warning, of sorts, as the Trump administration seeks to relax banking regulations introduced after the last crisis.

Trump’s Dirty Money and How It Will Bring Him Down

Imagine you had a lot of money—say billions of dollars of dirty money stolen from businesses, banks or taxpayers. Money that is totally illegal to move around internationally, but is TOO MUCH MONEY to ignore.  How do you clean that money up?

Enter Donald Trump.

Trump had two plans that he repeated over the years to steal money from people. The first one went like this:  Trump would say, people love my brand and trust my name, so much so that they are willing to put up big money for one of my projects because they “trust” that they will get their money back or get the product they are putting the money up for—say a condo or luxury apartment in a high-rise building.

Trump would put his name all over the marketing materials, put a picture of himself with his daughter on the cover of a fancy binder used to sell the product, maybe even put his name on the top of a high-rise building. People would put up big deposits or otherwise invest money.  But oops!! the deal would fall through–and never because it was Trump’s fault of course, and those deposits–sometimes millions of dollars worth, would disappear.  Never into Donald’s pocket though, of course.

If you want an example of this, see Trump’s Baja California condo scam.

But that’s small potatoes.  The big money for Trump–the billions–came from helping people with lots of dirty money take that money, like money stolen from Russian oil companies or Georgian banks, and make it “clean.”  In exchange for a fee, of course.

Here’s how it worked: the people with the dirty money would come in, “invest it” in a project that of course had Trump’s name all of over it, so it could be trusted as totally legitimate.  The money, however, would all get funneled through the project and back into the scammer’s own pockets as “profits” from the construction.  Trump, meanwhile, would get a 12% cut just for letting them use his name and his reputation as a way to sell it.  In exchange, Trump would never ask a question about where that money came from.

The project would then fail, either before it got started or after it was built.  But by that time it wouldn’t matter, because all of the real money would have been “cleaned” through the project and Trump would have been paid.  In fact, that would be the real point, to clean the money, not to build an actual successful project.

This type of repeated business of failure wasn’t just “bad luck” or “bad business.”  The failure was intended all along because nobody investigates failure.  And Trump’s construction projects and construction licensing deals repeatedly failed. But of course, Trump still made money off the deals.  They didn’t fail because they sucked (perhaps some did), they instead purposely and intentionally failed because people never look closely into a failed project.  That makes a failed project a perfect cover for laundering money, committing fraud, making “dirty” money into “clean” money, or using the project as a fake failure to shield illegal acts.  Nobody would bother to look at a failed business.

So now let’s say you are a foreign government and you are looking for dirt on Trump either because he’s running for president or just because you always keep track of the big shots who do business in and around your country.  Trump would have qualified as far back as the 1980s.

And let’s say now that you discovered a deal (or several) where someone was taking money stolen from a bank or secretly taking money from a bank they work for as an executive and investing it in their own personal side business in order to put the money in their own pocket.  And let’s say you figured out that person wanted in on the Trump money laundering train in order to “clean” the “dirty” money.

And now you, as the foreign government, discover and get all the evidence to prove the following: A man came up with a big fancy building in a former soviet country like Georgia, even though nobody in Georgia wanted to buy units in a big fancy building. But who cares, the point was to use the project as a shell to cover up the “cleaning” of “dirty” money.  The guy brought in Trump to slap his name on it, and take 12% of the money.  Meanwhile, with Trump’s protection making it look like “legitimate business” the guy ran the rest of the money through the project to make the “dirty money” into “clean” money.

The deal, however, fell through after Trump got elected and then had to pull out of the deal because the spotlight was too bright.  But in the years before that, while the deal was moving forward, all of the documentation on the deal got into the hands of the foreign government, who went over all of it and figured out the entire scam and how Trump would directly profit from it and participated in financial crimes.

Now say that foreign government was actually the Russian government.

If you are the Russian government, you use that information to put pressure on Trump to do the things you want him to do.  Imagine you have information on multiple projects that were only shell projects with Trump’s name on them with the only purpose of “cleaning” money that is “dirty.”  It not only would make Trump look bad, but it would be clear undisputed evidence of financial crimes by Trump that could send him to jail.

If that sounds too crazy of a story, it’s not.  It’s a true story.

And this is where the Mueller investigation is going—into all of the shady deals Trump did, all of the dirty money Trump made clean, all of the fraud Trump covered up or participated in. You might ask yourself, what does that have to do with Trump being president?

It has to do with the fact that the information can be used against him.  Either to make him do stuff or pressure him not to do stuff…. “If you do X, we’ll release documents showing how you committed fraud and will go to jail.”

Russia knows about a lot of Trump’s illegal scams and has all the evidence to bury Trump.  And Russia is using that evidence to try to force Trump to do things that help Russia.  Why turn someone in when you can blackmail them instead and get even better things from it?

This would not only be grounds for locking Trump up, it would be grounds for impeachment–a president doing something for a foreign government that is extorting him and paying him at the same time wouldn’t make it.

It’s all about the money.

 

Republicans Don’t Believe Trump’s Own Words if it Makes Him Look Bad

President Donald Trump fired the FBI director and later explained in a news interview that part of the reason why the FBI director was fired was the ongoing Russian investigation against Trump and his campaign.  Of course, when the firing was first announce the president said the real reason was the botched Hillary investigation by the FBI.  He didn’t want to say that he fired a guy because he was tired of the guy investigating him for criminal wrongdoing.  That would be . . . a crime!  But eventually he stopped caring and admitted it–he fired Comey over the Russian investigation.

Even though Trump has now come right out and said that he fired Comey due to the investigation, republicans REFUSE to believe that the Russian investigation had anything to do with the firing.  Trump tells them the reason right to their face and yet, they don’t believe it.  His supporters seem unwilling to believe anything negative about Trump, even when he himself admits it.

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Trump Plan to Mobilize 100,000 National Guard Troops to Round Up Mexicans, Final Solution in the Works

The AP reports that Trump is preparing a plan to call up 100,000 national guard troops to round up Mexicans and put them in camps.  Best case scenario is that he only deports them.

Trump’s spokeshole says this is a lie, but Spicer is a pathological liar just like his boss, so his statements are worthless.  You have to look at their conduct and not at their words.  In reality, there is a draft memo for the plan.  You can read it here.

 

 

Moscow Mike Flynn, Trump’s Failed National Security Advisor Resigns

Out Out Out!!!  LOCK HIM UP!!  Putin’s minion in the White House has resigned after it became clear his head is deeply up Putin’s behind.  The White House was warned that Moscow Mike Flynn was a traitor back in January, but instead of taking action, the incompetent Trump dimwits sat on the information and fired the messenger.

The acting attorney general informed the Trump White House late last month that she believed Michael Flynn had misled senior administration officials about the nature of his communications with the Russian ambassador to the United States, and warned that the national security adviser was potentially vulnerable to Russian blackmail, current and former U.S. officials said.

Whatever the case, it is thanks to real reporters that we learned the story behind Moscow Mike and his links with Putin.  Even with those links though, Flynn only really became toast after he lied to the Vice President, Mike Pence.

Even more pathetic is the fact that Moscow Mike Flynn led the charge against Hillary Clinton and her e-mail server–the one nobody cared about the day after the election (it was so important though the day before, right!!??!).  Flynn is a disgrace.

Grab some popcorn, this is only the beginning:

 

Trump’s Russian Oil Money

Inside the Steele Dossier, a document with a big list of claims about Trump (including one that he had hookers piss on him in bed in Moscow), there was one interesting claim about one of Trump’s key advisers and Russian oil money.  It went like this:

Igor Sechin, the CEO of Russia’s state oil company, offered former Trump ally Carter Page and his associates the brokerage of a 19% stake in the company in exchange for the lifting of US sanctions on Russia.

The sale eventually went through (with or without Page, we don’t know).  And while Trump’s stooge Page could deny that he received the 19% stake in the oil company, we know that Russia sold stake in Rosneft, with 19.5% going to someone.  But we don’t know who supplied the financing for the deal or who the purchasers were, and those facts are untraceable.  So was Carter Page one of the ultimate money-makers from the deal?  Was Trump?  Was a different Trump stooge?  Who knows.

More than a month after Russia announced one of its biggest privatizations since the 1990s, selling a 19.5 percent stake in its giant oil company Rosneft, it still isn’t possible to determine from public records the full identities of those who bought it.

What we do know is that Rex Tillerson, the former CEO of Exxon, is now secretary of state.  Something Carter Page was very excited about.  Tillerson’s Exxon also had a huge deal with Rosneft, probably worth hundreds of billions of dollars, but paused due to all the sanctions the U.S. slapped on Russia.   How long will those sanctions last?  Will they be lifted so Tillerson and/or Page can directly benefit?

Meanwhile, the Russians are rounding up and/or killing people that were associated with the Steele dossier:

Oleg Erovinkin, a former general in the KGB and its successor the FSB, was found dead in the back of his car in Moscow on Boxing Day in mysterious circumstances.

Erovinkin was a key aide to Igor Sechin, a former deputy prime minister and now head of Rosneft, the state-owned oil company, who is repeatedly named in the dossier.

As for that 19.5% stake in Rosneft, it was sold in December to a trading company called Glencore Plc and Qatar’s sovereign wealth fund, and likely split 50/50 between both.  Strangely, Glencore only contributed 300 million euro for its portion, and a Cayman Island firm, with unknown owners, is the owner of an unknown percentage of Glencore’s stake.

It’s as if the Russians are doing business with people who really don’t want the world to know who they are.