Items of Interest:
Perspective: Housing Bottom Nowhere in Sight -- The most respected housing expert on the planet, Robert Shiller, recently gave his opinion on the future of our housing market:
“Even the federal government has projected price decreases through 2010. As a baseline, the stress tests recently performed on big banks included a total fall in housing prices of 41% from 2006 through 2010. Their “more adverse” forecast projected a drop of 48% -- suggesting that important housing ratios, like price-to-rent, and price-to-construction-cost -- would fall to their lowest levels in 20 years. Long declines do happen with some regularity. And despite the uptick last week in pending home sales and recent improvement in consumer confidence, we still appear to be in a continuing price decline."Joshua Zumbrun / Forbes:
"After the bursting of the Japanese housing bubble in 1991, land prices in Japan’s major cities fell every single year for 15 consecutive years. Even if there is a quick end to the recession, the housing market’s poor performance may linger. After the last home price boom, which ended about the time of the 1990-91 recession, home prices did not start moving upward, even incrementally, until 1997.”
Hot Air: Think We’re in a Recovery? Think Again----
Bair Cautions Banking Crisis Is Not Over -- As focus turns to regulation reform, she says ''many more bank failures'' lay ahead.
Sheila Bair, chairman of the Federal Deposit Insurance Corporation, said Friday that while the crisis that swept through the financial world last year has subsided somewhat, it was far from over and there would be "many more bank failures" ahead."
I think there's still some challenges, I think we need to be realistic...
Bair reminded, 21 insured institutions failed in the first three months of 2009, the most bank failures since 1992. The FDIC's list of problem banks grew to 305 from 252. Those 305 banks at risk of failure have some $220 billion in assets. . .
Blaming the Guy Who Came Before Doesn’t Work Long -- As President Obama struggles to turn around the moribund economy and confront multiple international issues, he wastes few opportunities to remind the country that the problems are not of his making.
“The financial crisis this administration inherited is still creating painful challenges for businesses and families alike,” Mr. Obama said this week as he proposed spending limits.
“We inherited a financial crisis unlike any that we’ve seen in our time,” he said last week as he thrust General Motors into bankruptcy. . .
Jim Oliphant / The Swamp: Ex-smoker Obama lauds tobacco billRobert Stacy McCain / The Other McCain: Massive New Deficit Spending!Dakinikat / The Confluence: At WHAT point does HE own it?Ed Kilgore / Democratic Strategist: Leaders — Most Democrats understand the downside …Ben Smith / Ben Smith's Blog: White House postpones immigration meeting, againPrairie Weather: Ugly pictures — Richard Wolff, the reporter who traveled …
B. Ritholtz / Big Picture:
Krugman’s Crisis Responsibility: Reagan or Bush?
----First Step Towards Nationalized Health Care?
Laura Litvan / Bloomberg:
House Health-Care Bill to Include $600 Billion in Tax Increases — Health-care overhaul legislation being drafted by House Democrats will include $600 billion in tax increases and $400 billion in cuts to Medicare and Medicaid, Ways and Means Committee Chairman Charles Rangel said. . .
Tyler Durden / Zero Hedge: $600 Billion In New Taxes ComingBrian Faughnan / RedState: Rangel: ‘Fixing’ Health Care to Cost More than $1 TrillionPhilip Klein / AmSpecBlog: Rangel: House Dem Health Care Bill to Have $600 bln in Tax HikesMary Katharine Ham / Weekly Standard: Democrat Health Care Reform to Hike Taxes $600 Billion
Elisabeth Eaves / Forbes:
The Recession Is Great -- This week I refinanced my mortgage at a new, better rate, lowering my monthly expenses with a stroke of the pen. Even as I was doing the paperwork, I had to dodge calls trying to offer me similar and even better rates. If you're creditworthy these days, banks can't shovel money at you fast enough.
This got me thinking about all the other ways in which this recession might be a good thing. . .
Don Surber: An Obama recession is way coolMaria Woehr / Dealscape: Roll Call: The Recession Is Great
----Dennis Cauchon / USA Today:
Employed see tough times, too -- People who still have jobs are faring worse than at any time since the Great Depression, a USA TODAY analysis of employment data found. Furloughs, pay cuts and reduced hours are taking a toll on workers who so far have escaped job cuts.
The employed worked fewer hours in May — an average of just 33.1 hours a week — than at any time since the Bureau of Labor Statistics began counting in 1964. Part-time work is at a record high. Overtime is at a record low...
----Harvesting the Fruit of the Blackberry
Wall Street Journal:
Tax Man's Target: The Mobile Phone -- The use of company-issued mobile phones could trigger new federal income taxes on millions of Americans as a "fringe benefit."
The Internal Revenue Service proposed employers assign 25% of an employee's annual phone expenses as a taxable benefit. Under that scenario, a worker in the 28% tax bracket, whose wireless device costs the company $1,500 a year, could see $105 in additional federal income tax. . .
Erick Erickson / Erick's blog: Barack Obama Wants to Increase Your Taxable Income By Taxing Your Phone Usage
----Bizarre Czar Bazaar
Kudlow Report / CNBC:
CZARS FOR SALE? -- Kudlow & Company researched the contributions made to Team Obama's Presidential campaign and related Democratic activites by those who have since become Presidential "Czars."
Here are the findings:
- Steve Rattner, Auto Czar – $61,150
- Ken Feinberg, Pay Czar – $23,800
- Alan Bersin, Border Czar – $30,800
- Cass Sunstein, Regulatory Czar – $9,500
- Todd Stern, Climate Czar – $7,600
- Carol Browner, Energy Czar – $5,600
- Richard Holbrooke, AfPak Czar – $4,600
- J Scott Gration, Sudan Czar – $2,700
- Vivek Kundra, Infotech Czar – $4,300
- Herb Allison, TARP Czar – $2,300
- Ron Bloom, Auto Task Force Czar - $2,300
----Czars do not need to be approved by Congress
Brewer Petitions White House for 'Beer Nutrition Czar' Position -- With Obama Administration About to Appoint as Many Czars as a 24-Pack of Beer, Author and Certified Brewer Will Petition Country's Chief Beer Drinker for a Much Needed Beer Nutrition Czar Slot...
----Paul Kiel / ProPublica:
Bailed-Out Bank Execs Get Payouts -- The Treasury recently released rules that prohibit "golden parachute" payments at banks receiving TARP funds. But we've found a number of executives at bailed-out banks that have received large payments just for resigning....
- Where Do We Go From Here? - Donald Luskin, SmartMoney
- Massive Public Debt: The Biggest Bill in History - The Economist
- Inflation Is Nothing Compared To The Cure - Clem Chambers, Forbes
- Watch Out for Hidden Taxes - Susan Dudley & Jeff Rosen, Boston Globe
- Bank Investors Throw Cash at Ailing Companies - David Pauly, Bloomberg
- BlackRock Bets Big on Barclays - Tiernan Ray, Barron's
- Betting the Farm on Farmland - Brian O'Keefe, Fortune
- Earmark Addiction - Editorial, Chicago Tribune
- Delay the Minimum-Wage Hike - David Neumark, Wall Street Journal
- How the Recession is Wrecking Friendships - Emily Bazelon, Slate
- After the Crisis, Capitalism Is Discredited - Joseph Stiglitz, Vanity Fair
- Creating a Depression Index - Tim Kane, RealClearMarkets
- There Is No 'Paradox of Thrift' - David Blankenhorn, The Weekly Standard
- Finally, the SEC Is Protecting Investors - Thomas Kostigen, MarketWatch
- A Fat Tax That's Hard to Swallow - Alex Brill & Aparna Mathur, American
- It's Official: The Era of Cheap Oil Is Over - Michael Klare, The Nation
- Cap & Trade Fails Cost Analysis - Jim Manzi, Investor's Business Daily
- Legal Trade Barriers Must Be Kept In Check - Bhagwati & Panagariya, FT
- UBS Sold Tax Evasion As a Service - Ann Woolner, Bloomberg
- Spending Stimulus Money Takes Money - Alec MacGillis, Washington Post
- Losing Rio Tinto Is Nothing to China - Gordon Chang, Forbes
- Is Safer Air Travel Worth the Cost? - Catherine Holahan, MSN Money
- D.C. Can't Be 'Hands Off' With GM - Robert Farago, Wall Street Journal
- Just How Many Regulations is Goldman Exempt? - T. Durden, Zero Hedge