Friday, October 31, 2014

How Americans Go Poor By Spending Money On Housing And Related Expenses



Americans spend 33 percent of their income on housing-related items

People tend to think that buying a home means only paying principal and interest.  Most conveniently forget the other myriad of expenses associated with being a homeowner.  As Americans find less disposable income in their bank account each month, less Americans are becoming homeowners.  The middle class is moving away from the American dream because of the slow process of inflation.  Beyond the principal and interest, people spend money on taxes, utilities, furniture, repairs, insurance and other costs that come with being a homeowner.  Even non-homeowners spend an inordinate amount of money on housing.  Overall Americans spend 33 percent of their income on housing-related items.  This is probably why Wall Street has an insatiable appetite to buy up properties to convert them into rentals.  Americans are now seeing a large share of their income going into the housing pipeline.
How much do Americans spend on housing-related items?
In total, Americans spend $16,687 a year on housing. This amounts to 33 percent of total income on housing-related expenses.  We can break down the numbers as follows:
-Households spent most on shelter (59 percent)
– 60 percent of expenditures on shelter were on owned dwellings.  These expenses consist of:
-Mortgage and interest charges ($3,067)
-Property taxes ($1,836)
-Maintenance, repairs, insurance, and other expenses ($1,153)
These are the most upfront costs but there are many others:
house poor spending on housing
Source:  BLS
As you can see from the above chart, a large portion of money is siphoned off into merely being in a property.  Homeowners have higher expenses in the form of property taxes, insurance, maintenance, and other items that a person renting may not encounter.  With incomes being stagnant, Americans are seeing more money flowing into the housing industry.
Home prices have jumped while wages have remained stagnant:
home prices and income
While home prices are up nearly 20 percent year-over-year, household incomes remain stagnant.  What this translates to for many families is that more money is going into the housing expenses category.  Their dollars are no longer going as far as they once did.
It is a big shift for many Americans that believe owning a home is part of the American dream.  In many metro areas, home prices have priced out many families from buying.  Even though many are eager to buy, they need to realize all the other expenses that go with owning a property.  I’m not sure many think this through when sitting at a bank to buy a home.
It is understandable how many Americans go poor by being homeowners.  In many cases, you have older Americans living in a paid off modest home and barely scraping by.  Social Securitygoes to pay property taxes, insurance, maintenance, and other costs that never go away.  House rich and cash poor continues to ring true for many homeowners.

Thursday, October 30, 2014

Mel Watt, Federal Housing Finance Agency Head, is Pushing Banks to Make Extremely Risky Home Loans


Screen Shot 2014-10-17 at 1.43.16 PM
By Michael Krieger  and originally published at libertyblitzkrieg.com

Mel Watt is one of the most dangerous financial oligarch puppets operating in America today. The first time he came across my radar screen was back in 2009, when he “gutted” Ron Paul’s End the Fed bill while it was in subcommittee, something I outlined in the post: Leverage in PE Deals Soars Despite Fed Warnings; Amidst Insatiable Demand for Risky Fannie Mae Debt.
Then in May of this year, I zeroed in on his latest authoritarian maneuver after being appointed to head the FHFA in the post: New Massive Federal Database to Hold Financial Information on Hundreds of Millions of Americans. Here’s an excerpt:
As many as 227 million Americans may be compelled to disclose intimate details of their families and financial lives — including their Social Security numbers — in a new national database being assembled by two federal agencies.
The Federal Housing Finance Agency and the Consumer Financial Protection Bureau posted an April 16 Federal Register notice of an expansion of their joint National Mortgage Database Program to include personally identifiable information that reveals actual users, a reversal of previously stated policy.
In a May 15 letter to FHFA Director Mel Watt and CFPB Director Richard Cordray, Rep. Jeb Hensarling, R-Texas, and Sen. Mike Crapo, R-Idaho, charged, “this expansion represents an unwarranted intrusion into the private lives of ordinary Americans.”
So what’s Mel up to these days? Well, Bloomberg reports that:
A U.S. housing regulator plans new steps to encourage banks to lend to buyers with less than-perfect credit scores, according to two people with direct knowledge of the matter.
Watt will also discuss an effort that would allow borrowers to put down as little as 3 percent of the purchase price on loans backed by Fannie Mae and Freddie Mac, the people said.
Fannie Mae and Freddie Mac (FMCC), which have been under U.S. conservatorship since 2008, buy mortgages and package them into bonds on which they guarantee payments of principal and interest. Watt’s announcement is part of an effort to encourage banks to ease credit and follows a series of steps he first described in May.
It’s for the good of the people right? He’s a “liberal” so he’s always working for the little guy, right? Wrong.
The best characterization of Mr. Watt I’ve seen comes from realestate.com, here it is:
While some observers consider Watt’s appointment a significant lurch to the left compared to DeMarco, (he was among those named by the Democratic Socialists of America as a member of their caucus in 2009), Watt himself has raised a tremendous amount of money from banking and real estate-related corporations and trade associations. One report from the Sunlight Foundation found that for 2009, Watt had received some 45 percent of his total campaign funds from donors in the finance and real estate sector.
This is what all these phony “liberals” do. They pretend to be champions of the poor so that they can fool their clueless constituents and thus serve the oligarchy that much more effectively. This housing plan isn’t about helping families afford homes, it’s about creating artificial demand for overpriced homes so that stuck private equity and hedge fund mangers (who can no longer make it rain in the buy-to-rent trade) have some peasants to sell to ahead of the next crash.
Rule Number 1 of Oligarch Club: Always make sure you sell to the muppets before the music stops. Here we go again.
In Liberty,
Michael Krieger

Wednesday, October 29, 2014

Change Your Life



By Adam Carolla and originally published at prageruniversity.com

I'd like to talk about 'Emotional Growth', aka 'Change', the greatest part about being a human being that we completely ignore. If you think about it, every other species on the planet is unable to change. Polar bears, they can't change. Actually, you can ask. No, you know what, don't bother. They'll eat you.

I mean, really. Nothing else on the planet can change but us. We can change. It's the greatest thing about being a human being, yet we squander it every single day. How many people do you know that are exactly the same as they were in high school? And by the way that's always bad. Even if you were good in high school, not changing is bad. But most of the people I know started off bad. And whatever habits they had, good or bad, or idiosyncratic behavior, they're taking it straight to the grave.


The only way you can change (and believe you me, everybody around you wants you to change in some way, shape, or form -- that's the sad part). The only way you can change is through internalizing.

The way you internalize is, just about everything that happens in your life, you make yourself responsible. And it's easy to do -- it's painful to do, it's rarely done, but here's how you do it.


Let's just say I wanted some FroYo. And by the way, how lazy are we that we can't even say 'Zen' and 'Gurt'. Let's just I wanted some frozen yogurt. And I got in my car, and I went up the street, and I went to the frozen yogurt place, and it was closed. Now, I could pound on the glass and throw my hands up to the heavens and scream "WHY?" It's noon. It's Tuesday. It's the middle of the summer. You guys should be open. This is an outrage. 
Or, I can think, "You know what? I should have called first."


Because the only way I can get anything out of this experience is by turning it to myself and on myself and internalizing. And I'm not saying I'm a bad man or should be incarcerated for not calling them first. But if I can get into the habit of making almost everything my -- not fault -- but responsibility, then I can use what was a wasted trip across town into a learning experience. Whether it's riding a motorcycle with no helmet or going to the FroYo place and finding it's not open, you are the first person that makes that decision.


And if you're going to blame your teachers, meaning I got an 'F' because they don't like me. Or you're going to blame your girlfriend or boyfriend because "they don't listen", "they don't understand", "every guy I meet is in love with himself and never listens". Well what... every guy you meet. What's the one constant in this equation?
Well, that would be YOU.


So please find a mirror and start looking into it.


Change as a human being should not be something we shun. It should be something we embrace. And it is humbling, and it doesn't feel good. But it's the greatest gift we have as human beings.

Again, salamanders and koala bears -- although what would you change about a koala bear, they're so squeezable, those guys -- they don't have a choice! We can go from unemployable, horrible, uneducated to God's gift to humanity with just a little something called change and first internalizing.

I'm Adam Carolla for Prager University.

Tuesday, October 28, 2014

Suddenly, We Have Problems

By John Rubino and originally published at dollarcollapse.com 
A rising stock market, like a rising tide, can cover a multitude of interesting and/or scary things. If the finance guys who really know what’s going on are buying, then the disturbing stories that lead each evening’s news must be manageable. And we, in general, must be okay.
But let the market fall a bit and those headlines suddenly begin to seem both oppressive and really, really numerous. And maybe we’re not okay after all.
To take just a few of the issues that, in the wake of the recent equity correction, now loom large:
Islamic State, the tiny band of religious crazies that the US armed to do its bidding in the Syrian civil war is now threatening to take Baghdad, capital of Iraq and home to a US embassy that will live forever in the annals of hubristic excess. Actually a small, self-contained city, the embassy contains all kinds of sensitive equipment, documents and personnel, and will be defended with (thousands of) boots on the ground if an Islamic State victory appears imminent — which it now seems to be. In other words, we’re getting ready to dump another trillion or so dollars into the hole where we previously dumped two trillion with nothing to show for it but chaos.
Ebola, a nasty virus that was previously polite enough to stay in Africa, has escaped and is now touring Europe and the US. Either it has mutated to become more communicable or the West’s protocols for dealing with it are inadequate. Either way, there is now talk of the disease breaking free and causing a First World pandemic. See Ebola pandemic spreading across Europe is ‘unavoidable,’ WHO warns.
The strong dollar, meanwhile, has had the same effect on the world as would higher US interest rates, slowing growth and causing hot money to leave emerging markets and pour into US Treasuries. So while everyone is waiting for the Fed to raise interest rates and court the traditional “taper tantrum” liquidity crisis, the foreign exchange markets have done the heavy lifting already. See Why a strong dollar is scarier than taper tantrum.
Japan and Europe are dropping into recessions that could easily become system-threatening depressions. While US stocks were rising it was possible to view America as an island of stability in a chaotic world. But when US stocks start to fall it’s much easier to envision an interconnected world where everyone feels everyone else’s pain. Which is the accurate viewpoint, because who will buy our stuff — including the bonds that finance our deficits — if the other major economies grind to a halt?
Junk bonds, typically a canary in the financial-bubble coal mine, began selling off in September, just as the dollar started to spike. This was also easy to ignore while equity prices were rising, but now looks like the first of many dominoes to fall in a financial panic.
And it’s October! All of the above happening simultaneously would be scary anytime, but coming in the month when some of the most dramatic stock market crashes have for some reason occurred, this must feel like deja vu all over again for folks with a sense of financial history.
It’s impossible, of course, to know whether something is a crisis until it becomes one. So this might turn out to be nothing more than a hiccup in the permanent new normal of ever-rising financial asset prices. We’ll know soon enough.

Monday, October 27, 2014

The Lie Machine

By Paul Craig Roberts and originally published at paulcraigroberts.org  
I have come to the conclusion that the West is a vast lie machine for the secret agendas of vested interests. Consider, for example, the Transatlantic Trade and Investment Partnership and the Transpacific Trade and Investment Partnership.
These so-called “partnerships” are in fact vehicles by which US corporations make themselves immune to the sovereign laws of foreign countries in which they do business. A sovereign country that attempts to enforce its laws against an American corporation can be sued by the corporation for “restraint of trade.” For example, if Monsanto wants to sell GMO seeds in France or US corporations wish to sell genetically-modified foods in France, and France enforces its laws against GMOs, the Transatlantic Trade Partnership allows France to be sued in jurisdictions outside the courts of France for “restraint of trade.” In other words, preventing the entry into France of a prohibited product constitutes restraint of trade.
This is the reason that the US has insisted that the Transatlantic and Transpacific Partnerships be totally secretive and negotiated outside the democratic process. Not even the US Congress has been permitted knowledge of the negotiations.
Obviously, the Europeans and Asians who are agreeing with the terms of these “partnerships” are the bought-and-paid-for agents of the US corporations. If the partnerships go through, the only law in Europe and Asia will be US law. The European and Asian government officials who agree to the hegemony of US corporations over the laws of their countries will be so handsomely paid that they could enter the realm of the One Percent.
It is interesting to compare the BBC’s coverage (October 10) with that of RT (October 11). The BBC reports that the aim of the Transatlantic Partnership is to remove “barriers to bilateral commerce” and to stimulate more trade and investment, economic growth and employment. The BBC does not report that the removal of barriers includes barriers against GMO products.
Everyone knows that the European Commission is corrupt. Who would be surprised if its members hope to be enriched by the American corporations? Little wonder the European Commission declared that concerns that the Transatlantic partnership would impact the sovereignty of countries is misplaced.  http://www.bbc.com/news/business-29572475
RT, which is restrained in reporting truth because it operates inside the US, still manages to come to the point in its headline: “No TTIP: Mass protests slam US-EU trade deal as ‘Corporate power grab’.”
All over Europe people are in the streets in mass rallies against secret agreements by their corrupt governments for Washington to take over their lives and businesses. RT reports that “social networks have been mobilized for a mass campaign that has been calling on Europeans and Americans to take action against ‘the biggest corporate power grab in a decade’.”
RT quotes a leader of the demonstration in Berlin who says the secret agreements “give corporations more rights they’ve ever had in history.” As we all know, corporations already have too many rights.
“Protests are planned in 22 countries across Europe–marches, rallies and other public events–in over 1,000 locations in UK, France, Germany, Italy, Spain, Greece, Netherlands, Poland, The Czech Republic and Scandinavian countries.”
Did you hear about this latest American corporate power grab from Fox “News,” CNN, New York Times, London Times, ABC? Of course not. Did you hear about the massive protests against it? Of course not. You only hear what the interest groups permit you to hear.
RT reports that the main aim of the international protests is “to reclaim democracy” and to put an end to the secret deals that are destroying life for everyone but the American corporations, organizations now regarded worldwide as the epitome of evil.
http://rt.com/news/195144-europe-protests-stop-ttip/
These phony “trade agreements” are advocated as “free trade removal of tariffs,” but what they remove are the sovereignties of countries. America is already ruled by corporations. If these faux “trade agreements” go through, Europe and Asia will also be ruled by American corporations.

Sunday, October 26, 2014

Liberty, Knowledge & Love



By John MacArthur and originally published at gty.org  
God’s Word does not give us detailed instructions for every aspect of Christian life. Believers are frequently confronted with situations, questions, and decisions that Scripture says nothing about. God’s people have been set free from the Old Testament law, but that freedom leaves us with a lot of important decisions to make in life’s gray areas.
And that reality is not unique to the modern church. The believers in Corinth faced several issues that were not addressed in the Old Testament or any of the apostolic writings they had access to. They wrote to the apostle Paul for guidance (1 Corinthians 7:1), and his answers give us helpful, biblical principles that ought to guide our decisions and how we use our freedom in Christ.
In particular, Paul exhorts his readers to be thoughtful about the exercise of their liberty, considering both the example they set for others and the effect of their choices on their own lives. We’ll look at his instructions to the Corinthian church over the next few days, starting with his admonition for them to consider each other in the decisions they make.
Causing a Brother to Stumble
Throughout his ministry, Paul repeatedly exhorted his readers to consider their influence on others and to avoid leading other believers into sin. In Romans 14:13, he wrote, “Therefore let us not judge one another anymore, but rather determine this—not to put an obstacle or a stumbling block in a brother’s way.”
His words echo Christ’s dire warning to the person who leads others into sin: “It would be better for him if a millstone were hung around his neck and he were thrown into the sea, than that he would cause one of these little ones to stumble” (Luke 17:2).
That principle guides Paul’s answer to the Corinthians’ question. While some believers might feel free to exercise their liberty, he wanted to make sure their freedom to do so was not the priority. Instead, the priority must be the spiritual growth of the men and women around them. And he illustrates that very point in 1 Corinthians 8:13, saying “Therefore, if food causes my brother to stumble, I will never eat meat again, so that I will not cause my brother to stumble.”
Idolatry, Worship, and Food
Just like any other polytheistic culture, Roman society was highly superstitious. Not only did the Romans have a god or several gods for every aspect of daily life, they also believed in an array of evil spirits. Their sacrificial system was built around gaining and maintaining the favor of the gods and protection from the evil spirits.
Food sacrifices were most common, and particularly meat. The sacrifices were divided into thirds—one third would be burnt on the altar, while the other two were divided between the priests and the temple officers. And because idol worship dominated the culture, there was often a lot of meat left over, which was then sold in the marketplace.
It would have been virtually impossible for the Corinthians to avoid the sacrificial meat. Because it had been sacrificed—and therefore supposedly purged from the influence of evil spirits—it was highly valued, and usually served at banquets, weddings, and other social occasions. Christians could perhaps avoid some of those events, but if they had personal relationships with anyone outside the church, they would likely face the issue of eating sacrificial meat sooner or later.
It seems there was a divide in the church over how they should respond when confronted with meat that had been offered to idols. Many in the church had been saved out of the pagan Roman culture, and any activity related to idol worship—even the simple act of eating—might have greatly troubled their sensitive consciences and upset their spiritual growth.
However, more mature believers understood that the worship of idols was empty and vain, and that the meat was just meat. They ate with clear consciences, and likely were the ones writing to ask Paul for clarification and instruction in the debate.
Knowledge and Love
Paul’s answer indicates the Corinthians included in their letter a defense for eating meat sacrificed to idols. In 1 Corinthians 8:1, he acknowledges what may have been their first point of defense with the words “we know that we have all knowledge.” Taken on its own, that’s an egotistical statement, even if it’s partly true. It reflects a feeling of superiority from knowing and understanding God’s Word—a feeling Paul immediately undercuts in the latter half of the verse: “Knowledge makes arrogant, but love edifies.”
The mature Corinthians knew that the pagan gods were not real, and the meat offered to them posed no spiritual threat. But that knowledge turned their focus inward. The truth to them mattered as long as it affirmed their personal desires. They were insensitive to others, especially those in the Corinthian church who did not “have this knowledge” (1 Corinthians 8:7).
As Paul had previously said, “If anyone supposes that he knows anything, he has not yet known as he ought to know” (1 Corinthians 8:2). Their arrogance proved they didn’t know as much as they thought. They might have had the right doctrinal knowledge, but practically in their relationships with other Christians, they behaved in ignorance. By failing to act in love, their knowledge was rendered worthless.
Paul’s response to the mature believers put the focus where it should have been all along: on the other group. Rather than relishing their liberty, they should have been concerned about the impact it would have on others. To put it another way, just because they could eat with a clear conscience didn’t mean they should. They needed to consider their brothers and sisters in the church, and how their own actions could offend, confuse, or weaken another person’s faith. By ignoring that, eating the meat was an exercise of their arrogance, not their liberty.
We ought to have that sacrificial attitude when it comes to exercising our liberty in Christ. Just because we know we have freedom doesn’t mean we need to explore it to the fullest. Instead, we ought to be willing to restrain ourselves in love for the benefit of others whom we might offend by our actions.

Saturday, October 25, 2014

No Ebola Travel Ban, Terror in Canada and NYC, Financial War


WNW 163: No Ebola Travel Ban, Terror in Canada and NYC, Financial WarBy Greg Hunter’s USAWatchdog.com 
Another week, another Ebola infection.  This time, in crowded New York City.  This after the government declared “U.S. Ramps up Fight on Ebola.”  This time, a young American doctor who returned after treating Ebola victims in West Africa.  I cannot believe we do not have a travel ban and/or mandatory quarantine and testing for everyone coming from West Africa.  It seems too stupid to be stupid to “keep track” of people when we could just stop people from coming here, and we would not have to “keep track” of them. We are getting hundreds of folks from West Africa coming in every month.  Do you feel comfortable with the government keeping track of anything, let alone potentially sick people that could cause a deadly outbreak?  It’s almost as if they are inviting a pandemic to America.  Oh, and by the way, the new Ebola Czar, Ron Klain, reportedly said his biggest fear for the world is “how to deal with the continually growing population.”  Yes, that’s right.  The new Ebola Czar’s biggest concern is over-population.  That should make you feel all warm and fuzzy.
Terror, terror everywhere in North America.  The only difference is that, in Canada, they call it Islamic terror.  In the U.S., they call it work place violence.  You heard about the guy who took an ax to some New York City cops.  They shot the ax attacker dead, but not before he hurt some police.  This week, one of the editorial pages in USA Today talked about Christian extremists, but no one mentions Islamic extremists.  You don’t hear Christian extremists hacking police up with an ax.  It is simply outrageous not to call it what it really is, and I think more terror is on the way.  We are at war with extremists in the Islamic world.  That is clear.
Good news at the gas pump as prices are going down.  How long is that going to last?  Saudi Arabia has finally cut production to prop up oil prices.  It’s not all good news as shale oil needs a price of $85 a barrel to turn a profit.  That business could come crashing down as it is highly leveraged.  Also, it’s is not all supply and demand causing the prices of crude oil to fall.  It is financial war by the U.S. and the West to punish Russia over Ukraine.  The lower price is hurting Russia because Russia gets half its operating revenue from energy sales.  Russia is not going to sit idly by and be attacked. For example, Russia wants the EU to guarantee it will pay Ukraine’s natural gas bill this winter, and the EU is balking.  Russia will cut natural gas supplies if it is not paid, and that is only the beginning of this financial war.  Nobody is backing off from the sanctions, and this situation is only going to get worse this winter.
Finally, Fed Head Janet Yellen says “Inequality is worsening.”   She talked about this late last week, and I cannot believe she can say this with a straight face.  At one point last year, the Fed was printing and handing our $45 billion a month.  Much of that went to the bankers to buy their toxic mortgage-backed securities.  You print trillions of dollars to bail out your banking buddies and hedge funds, and you have the gall to stand up and complain of economic inequality?  That is rich.
Join Greg Hunter as he analyzes these stories and more in the Weekly News Wrap-Up.