At this point, I blame the media for fanning the flames of this incident. I've done my best to ignore the Ferguson news, but it's everywhere. I think it has become a self perpetuating news cycle (until something more interesting happens elsewhere). It's like the news media is in full blown cheerleading mode hoping that things continue to escalate.
I just don't know how this thing gets resolved. People have the right to assemble. People have the right to be pissed off about how Brown was killed. People have the right to be suspicious of how the news media was treated by local law enforcement in Ferguson. However, the violence on Friday night (shootings/Molotov cocktails at police) and continued property crimes against the citizens of Ferguson (looting, etc) can't be ignored by law enforcement.
What do you do when the presence of law enforcement is inciting certain agitators to act up, and at the same time these acts require the presence of law enforcement to investigate and protect the public interest? Law enforcement can't abandon the town. The troopers can't just strip down a minimal level of protective gear when items are being thrown and people are getting shot.
The governor hoped to diffuse the situation by removing the local police and sending in a different set of uniforms (the State Police). The State Police Captain did his best to reach out to the public and send the message that peaceful assembly would not be infringed upon. But the situation continues to deteriorate, and now the National Guard is involved. I'm not sure how it works at the state level, but I'm speculating the governor will have to declare some form of emergency and expand the curfew. This really sucks for the people who live and work in that town and who could give a fuck less about the protests. Law and order needs to be maintained, and some liberties may be curtailed in order to clamp down on a handful of provocateurs. All the while though, you can bet the news media will be chirping and talking heads will be yakking away about the police state. Posted: August 18th, 2014 @ 12:08PM
Russian strategic nuclear bombers conducted at least 16 incursions into northwestern U.S. air defense identification zones over the past 10 days, an unusually sharp increase in aerial penetrations, according to U.S. defense officials.
That reads like the bombers were detected on radar within range of U.S. airspace, not actually in U.S. airspace. There's a pretty clear difference, and the headline is intentionally misleading. Poor journalism, but good marketing for clicks. Posted: August 7th, 2014 @ 11:17AM
All low-income families are free riders? Of course they are!
In economics, the free rider problem refers to a situation where some individuals in a population either consume more than their fair share of a common resource, or pay less than their fair share of the cost of a common resource.
Where I live, 89% of my school district's taxes are paid for through local property taxes. The more land / higher the assessment, the greater the tax you pay. In the context of public schooling, yes, low income housing presents a free rider problem for me. I paid a ton of money for a nice house in a good district, and I face the prospect of decades of high school taxes. I did so for the express purpose of providing my children the best educational opportunities. Those opportunities would out of necessity be diminished if my district was flooded with low income housing (ie, it's a near certainty the low income residents would consume more educational resources than the amount of taxes they would pay).
I mean, how crazy I must be to think that towns/cities want to maintain some consistent culture.
I fail to see the connection between culture and low income housing. If anything, there's a negative correlation. Segregation by income level has been happening since the dawn of time. I'm perfectly fine with it. I see it as the natural order of things.
Now, if you want to just herd all low-income people into busses and knee-jerk uproot them because you don't want to live alongside them, be my guest, vote for that person.
I'm looking at this article from the opposite perspective--the devastating effect on wealth of moving a bunch of low income residents into a high income area. I assume you're looking at it from a gentrification angle (low income areas becoming high income areas due to professionals moving in). From that perspective, I can perhaps see where you're coming from. Posted: August 5th, 2014 @ 4:14AM
I'm curious why Smoking Joe thinks private industry should be compelled to give things to people who didn't earn it. Why should I pay what I did for a nice house in a good school district only to share the fruits of a lifetime of labor with some free riders? Posted: August 4th, 2014 @ 8:07PM
I remember around 1989 that people thought the U.S. sun was setting and Japan was on the rise. After all, they bought American landmarks like Pebble Beach golf course and Rockefeller Center. How's it working out for Japan these days?
I do believe America is in steady decline, but China's strength is overstated. They have a demographic bomb ready to go off with an aging population (like Japan), and their companies probably keep six sets of accounting books. Who knows what's real and what's bullshit regarding Chinese wealth. Posted: July 28th, 2014 @ 8:04PM
Nate: I've been in cash 18 months. I rode the rally for 3.5 years and decided to step off the train. Since then, I've definitely missed some huge gains. It's painful to look at some of the ticker symbols I let go. Hence my earlier statement: I don't know which hurts worse, the losses I've taken over the years or the gains I miss out on.
You're 100% correct on the house. I've got a growing family, and we have to live somewhere. As I was running the numbers prior to purchase, I actually projected the total 30-year cost of owning my proposed home versus the 30-year cost of renting the equivalent property (even though there is no simple equivalent). For my home costs, I added up principle, total interest costs, taxes (accelerating at just above inflation), home owners insurance (accelerating at inflation), remodeling costs that were equal to 50% of the purchase price of the home, and $300 per month of general upkeep. I then backed out the interest and real estate tax deductions from a federal bracket of 25%. For the rental option, I used a rent that seemed market appropriate (accelerating at inflation) and renter's insurance (accelerating at inflation).
The numbers were interesting. In short, owning was cheaper than renting over the 30-year period by approximately $500,000. The best part is that I own the home, and if home values appreciate at the 100-year rate of inflation (a modest 3.24% annually), I will have a nest egg worth well north of one million dollars in 30-years. Posted: July 27th, 2014 @ 6:00AM
I'm interested in the moral decisions people will make to survive. In a catastrophic CME scenario, most folks won't even know the scale of the problem for days or even weeks because communications would be dead. They'll think they can just hunker down and wait it out. Only when they're approaching starvation will they do things like loot and kill to survive. It really becomes a question of how quickly folks reach the moral breakpoint. In a city like NYC, with over 10 million population in the metro area, I imagine that widespread civil disorder would start within 3-5 days. It would probably be total anarchy inside a month. Even if order is restored in months or years, I think it's likely that most people who commit criminal acts (including murder) would get away with it. The job of investigating and trying those crimes would be too much. In a sick sort of way, those who are unafraid to push past moral boundaries and societal norms might be the inheritors of the earth. To further expand on this point, what happens when a hardened urban dweller meets a suburbanite who was prepared? If I've been living well because I'm prepared, am I less likely to pull the trigger on a stranger who is walking through my yard, peering in my windows? That guy might already be determined to kill anyone who stands in his way. Posted: July 25th, 2014 @ 1:42PM
1. My IRA, 401k, and deferred comp are 94% un-invested (cash) at the moment. I'm basically losing money through inflation. The only thing I'm holding is some CCJ (Cameco-a uranium company), but even that is less than 6% of my retirement funds. I have a multitude of reasons for being in that stock. Suffice to say, I'm a believer in the future of nuclear (I bought in AFTER Fukushima).
2. A good chunk of my liquidity is going into a house that I'm buying for my family. I have mixed feelings about buying a home right now. I'm getting a killer rate (3.75% 30-year fixed VA), but I have to wonder what will happen to home prices as rates rise. Most people (including myself) evaluate what kind of house they can afford based on the monthly principle, interest, taxes, and insurance payment. What happens if mortgage rates move to between 6-7% over the next decade? Given that 6-7% is middle of the road from an historical basis--my parents financed at 9% in 1986 and there have been mortgage rates over 10% in the past--I think such a move is likely. What happens to the ability to afford a home when rates double? Right now, the principle and interest for the home I'm buying is about 70% of the monthly payment. If the amount of interest doubled, it stands to reason that there would have to be a reduction in the amount of principle financed to compensate for the increased monthly interest expense. The only way to reduce the principle financed is through either 1) lower home prices or 2) a much larger down payment. Given that most people are cash strapped, I think home prices are going to take a shit once the interest rates rise. Knowing this in my head and living it, however, are two separate things. I can have a theory about the future of housing prices, but at some point I want to own something for my growing family. It might be a six of one, half dozen of the other kind of problem if I stay in the home for 30 years and pay it off. Falling prices only become a problem if I have to sell in the next 10-15 years. I'd hate to bring $100,000 to the closing table in order to unload my house. Posted: July 25th, 2014 @ 1:07PM
Smoking Joe - That second link you provided was pretty interesting. Lots of deep dives and links to explore regarding nuclear plants, the economy, recovery, etc. There's also lots of talk of water purification, dried goods, and guns at the individual level--which is where my head is at right now. Posted: July 25th, 2014 @ 11:54AM
Gee, thanks Trash, I never thought of doing that. I usually just read headlines and make ill considered comments. Now that I'm straightened out and see the light, my life will be forever changed.
I got about 1:30 into the video, after the traffic stop happened, and figured the rest wasn't relevant to the violation. It wasn't clear that the bicyclist was the one being tailgated. I thought it was the car in the left lane being tailgated, hence my original comment. Posted: July 25th, 2014 @ 8:46AM
I think we're in a bubble Killer, that's why I've been out of the market for over 18 months. There's just a ton of funny money floating around, and there aren't a lot of places to put it. No need to invest in capital production since demand isn't that high. Bonds are a terrible investment due to historically low rates. Real estate has recovered somewhat, but no one is in a hurry to bum rush back into that sector. Consequently, I think people have been piling into equities (stocks).
At some point, quantitative easing will come to an end, so the funny money train will be off the rails. Around the same time, I have to believe businesses will see that this recovery is weak sauce. The number of people who are unemployed, underemployed, on disability, or have simply stopped looking for work is staggering. What happens to stock prices then?
I realize this is an overly simplistic viewpoint fraught with gaps in understanding, and I could be dead wrong. Still, I can't wrap my mind around the current valuation of the market. Something isn't right. Posted: July 25th, 2014 @ 8:37AM
If I had the time, I would probably find about 20 financially solid companies with widely recognized products whose combined market capitalization does not equal that of Facebook. Trading at over 80x earnings is absurd. There's no way FB can grow its earnings at a rate to match that multiple.
As an aside, I've been out of the market since the beginning of 2013. What a kick in the balls the last 18 months have been. I don't know what hurts worse, the losses you take or the gains you miss? I look around and my eyeballs are telling me something different than what the S&P500, Dow, and Nasdaq charts are claiming. The lows of Feb 2009 were too low, but I don't know how the market can justify current price levels. I'm actively hoping the market tanks such that the DJIA goes back down to about 12-13k. Posted: July 24th, 2014 @ 2:25PM