Wednesday, January 02, 2008

The Washington Post - "Dollar's Fall Is Felt Around The Globe" (12-24-07)

"The sharp decline of the U.S. dollar since 2000 is affecting a broad swath of the world's population, with its drop on global markets being blamed at least in part for misfortunes as diverse as labor strikes in the Middle East, lost jobs in Europe and the end of an era of globe-trotting rich Americans. It marks a shift for Americans in the global economy. In times of strength, a mightier dollar allowed Americans to feed their insatiable appetite for foreign goods at cheap prices while providing Yankees abroad with virtually unrivaled economic clout. But now, as the United States struggles to fend off a recession, observers say the less lofty dollar is having both a tangible and intangible diminishing effect."

Mish's Global Economic Trend Analysis - "Not Your Father's Deflation: Rebuttal" (12-24-07)

"Schiff makes a false assumption that the Fed can replace credit out of thin air. The Fed is simply not in control of credit at all. The Fed can encourage borrowing but it cannot force it. The second failure by Schiff pertains to monetary printing. There are constraints on the Fed that he ignores. For example the Fed cannot simultaneously target both money supply and interest rates. Should the Fed pursue a massive printing campaign, interest rates will rise. Think of the consequences for housing and commercial real estate. Schiff ignores the consequences of interest rates on existing debt, much of which is variable rate. Furthermore, think about what rising rates would do to future expansion plans of businesses."

Reuters - "Rising inflation may cause Treasury bond yields to spike" (12-24-07)

"On Monday, the nominal benchmark 10-year Treasury note was yielding 4.21 percent, with the nominal 30-year bond yielding 4.61 percent. For now, most bond investors are betting that as the U.S. economy edges toward recession, demand will ebb, putting a lid on consumer prices. Since inflation is a lagging indicator, that would be the textbook reaction of prices to the onset of a painful economic downturn."

Palm Beach Post - "Condo crash burns big, sophisticated investor, too" (12-24-07)

"It's not just schoolteachers, bartenders and other real estate amateurs who got burned by the condo crash. Some big, seemingly sophisticated investors are taking hits, too. Condo converter Tarragon Corp. (Nasdaq: TARR) of New York just unloaded the 311-unit Floresta Apartments at 400 Via Royale in Jupiter for a hefty 28 percent loss."

Yahoo - "States eye ways to rein in property tax" (12-24-07)

"The amount paid in local and state property taxes in the country increased 50 percent from 2000 to 2006, according to Census data cited by some U.S. Congress members when discussing the topic. During that time, inflation rose 17 percent and median household income dropped 2 percent. Analysts cite a number of reasons for the dramatic bill increases including local governments and states leaning more heavily on property taxes to meet revenue shortfalls and rising home values pushing up assessments. Now, states are looking at ways to cut property taxes or at least give homeowners some relief by capping assessments and making up the revenue shortfall by raising sales taxes."

Orange County Register - "New homes in O.C. withstand wildfire better than older ones" (12-23-07)

"In the wake of firestorms that struck Southern California in October, attention has focused on whether cities and counties should restrict development in wild lands. But if such development is to take place – and even the most ardent critics are at a loss as to how to prevent it – it should be done the way it's done in Orange County, where homes are clustered together, vegetation is controlled and homes are built with noncombustible materials, say local fire officials and developers. Critics of developments in wild lands agree."

Youtube - "Paul Krugman" (12-23-07)

"In 'The Conscience of a Liberal', Paul Krugman, today's most widely read economist, studies the past eighty years of American history, from the reforms that tamed the harsh inequality of the Gilded..."

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