Mid-Week Open Thread (2011-01-12)

Here is your open thread for the mid-week on January 12th, 2011. You may post random links and off-topic discussions here. Also, if you have an idea or a topic you’d like to see covered in an article, please make it known.

Be sure to also check out the forums, and get your word in the user-driven discussions there!


About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

47 comments:

  1. 1
  2. 2
    Pegasus says:

    Nightmare on Wall Street

    “As I have been arguing in a series of pieces, in their haste to commit lender fraud, the banks that securitized mortgages also perpetrated tax fraud and securities fraud. The inevitable outcome of those frauds is foreclosure fraud. As Lynn Szymoniak and Ray Brown have written, 2010 became the year in which “‘foreclosure fraud’ emerged in case law’ — defined as ‘fraud by mortgage companies, mortgage servicing companies, and banks servicing as trustees for securitized trusts.” Foreclosure fraud is not a matter of some pesky little paperwork problems. It is the designated solution to paper-over the lending and securities and tax frauds that the banksters used to bubble-up and then collapse the US real estate sector. To put it simply, the Court found that the practices followed by the industry have made legal foreclosure impossible.”

    “But in their haste to steal property, the Wall Street banksters ran up against US property law. They thought the judges would turn a blind eye to blatant theft. Unfortunately, courts across the country have awakened and are beginning to rule against them. As I have said, the banks are toast — as anyone still holding bank stocks will discover in coming months. Losses will easily wipe out all equity at the biggest banks, several times over. Further, the vulture predators now buying up foreclosed properties will find that the titles are not clear. It will take at least a decade to sort out the mess created by Wall Street’s securitization of home mortgages and to restore property rights law.”

    much more:
    http://www.huffingtonpost.com/l-randall-wray/post_1564_b_807877.html

  3. 3

    RE: Pegasus @ 2

    The QEC2 Has Put Money in SWE’s Pockets Too

    For how long, Lord only Knows….but 2010’s stock market was good to me, about 15% investment interest….

    Do I agree with QEC2? Hades no, it’s made the federal deficit worse and possibly selling those low interest bonds for a profit later is a complete joke.

  4. 4
    Sniglet says:

    Not that any more proof were needed, but here is ANOTHER article which points out how US banks are still playing tricks with their financial statements by delaying foreclosures and delaying the need to write down losses.

    http://bit.ly/obdelpray

  5. 5
    Blurtman says:

    The TBTF banks and the US government are tied at the hip, inseparable. It is so bad that even the rule of law is meaningless. Why?

  6. 6
    2ktngo says:

    RE: Pegasus @ 2

    The article is long on all sorts of politically correct retoric. At the heart of the matter is some bank’s repo of (is it two?) properties. The paperwork on that mortgage transfer was not handled correctly, with some documents lost, mishandled, etc. You still have to remember that borrower was not paying the mortgage and calling this “theft” makes for a great story, but it is justified? Even more wild is extrapolating this case onto the entire banking system. Banks that committed wrongdoing in this case are out sizable legals fees and more to come. Deservedly so. Somehow in all this story people who did not pay on their obligation are heroes. Do they deserve to be?

  7. 7
    zipzippygc says:

    I am a little worried that a Melt Up in the stock market could arrest the natural correction — downward — in the price discovery process in our region, given so much stock monies are part of this relatively affluent area.

  8. 8
    Pegasus says:

    RE: 2ktngo @ 6 – Good point. Because someone could not pay their mortgage on time should we allow the banks to abandon the laws and rules to foreclose? I think not. Many of these foreclosures exist because either the loan was misrepresented when granted or because the banks destroyed the economy through their frauds and the homeowner lost their jobs because of the bank fraudsters. Let’s not rush to foreclose without the rules and laws being followed even though that has not been the case in the past ten years or so.

  9. 9
    Pegasus says:

    By zipzippygc @ 7:

    I am a little worried that a Melt Up in the stock market could arrest the natural correction — downward — in the price discovery process in our region, given so much stock monies are part of this relatively affluent area.

    Why do you think the stock market is being manipulated daily by the PPT and the FED? Their game plan is to inflate the stock market with taxpayer funds until it spills over into the housing market. They have failed so far but who knows? QE3?

  10. 10
    pfft says:

    By Pegasus @ 2:

    Nightmare on Wall Street

    “As I have been arguing in a series of pieces, in their haste to commit lender fraud, the banks that securitized mortgages

    so they didn’t lose almost a trillion dollars on those loans? were people not clamoring for those mortgage investments?

  11. 11
    pfft says:

    By Pegasus @ 8:

    RE: 2ktngo @ 6 – Good point. Because someone could not pay their mortgage on time should we allow the banks to abandon the laws and rules to foreclose? I think not. Many of these foreclosures exist because either the loan was misrepresented when granted or because the banks destroyed the economy through their frauds and the homeowner lost their jobs because of the bank fraudsters. Let’s not rush to foreclose without the rules and laws being followed even though that has not been the case in the past ten years or so.

    people bought homes they could not afford and they did it out of sheer greed almost as bad as any bank CEO. that is the truth. there is no excuse for buying 3 florida condos.

  12. 12
    pfft says:

    By zipzippygc @ 7:

    I am a little worried that a Melt Up in the stock market could arrest the natural correction — downward — in the price discovery process in our region, given so much stock monies are part of this relatively affluent area.

    prices are going to do what they are going to do. metrics are a guide but not absolute.

  13. 13
    One Eyed Man says:

    RE: Pegasus @ 2

    So Professor Wray thinks the big banks will be wiped out by foreclosure gate. Apparently he doesn’t believe in mark to market cause he wants them marked to zero and the market says the banks are worth a lot more than that. And as I’ve said for the last two years I wouldn’t bet against the referee’s. Tim, Ben, Obama and Boenher all lose in financial armageddon.

    Wray also plays a little fast and loose with the facts. He says that failing to record an assignment of mortgage is recording fraud. Maybe in some states but not in Washington and probably not in the majority of states. He says that the note transfers were tax fraud. If that’s the case I would assume we’ll be hearing about the IRS audits soon. If you know of any, please let me know as I haven’t heard of any MBS or REMIC audits so far.

    He says that MERS is fraud and the foreclosure gate paperwork problems are a cover up. I could be wrong but if you have some big time law firm legal opinions that said MERS works, I think that may be sufficient to create a reasonable doubt that the banksters had the intent to commit criminal fraud. It might constitute civil securities fraud notwithstanding the legal opinions due to the strict technical nature of some breaches of securities law, but it seems a little far fetched to think that someone would conspire to commit common law fraud by carrying out a publicly pre-disclosed set of actions. Its hard to get away with a fraud when you tell everyone exactly what you’re going to do before hand.

    And don’t forget all those liar loan mom’s and dad’s who swore they made 200K a year at WalMart. They’ll need foster care for their kids while they do hard time with the banksters that they ripped off.

    I’m not trying to tell you there’s nothing rotten in Denmark. I’m just telling you that the case against the banks isn’t as simple and clear cut as Wray makes it out to be.

  14. 14
    Pegasus says:

    RE: One Eyed Man @ 13 – I don’t necessarily agree with everything Wray said. He tends to be somewhat political in his interpretations. I fully expected him to pull a Krugman and blame Palin for all of the banks problems. That said he was far more correct than your constant inaccurate statements here that that there really is nothing or little going on with the banks and their practices. This not about a few documents submitted to the courts that were sloppily filled out. Several courts have already refused to allow the MERS games to continue in their states. Fannie Mae halted the use of their phony paperwork in foreclosures many moons ago. The list of abuses by the banks goes on and on and grows daily. As I have said here before that since the banks control Congress and the White House the solutions to their criminal behavior may just be another ready made cover-up with the taxpayers footing the bill.

  15. 15
    Blurtman says:

    RE: One Eyed Man @ 13 – Say, who is the head man at the IRS these days? And if you remove Getihner’s toupee, and shave his head, who might he bear a disturbing resemblance too? (sorry.)

  16. 16

    By One Eyed Man @ 13:

    Wray also plays a little fast and loose with the facts. He says that failing to record an assignment of mortgage is recording fraud. Maybe in some states but not in Washington and probably not in the majority of states.

    I think that people have a hard time understanding the difference between a tax and a fee. When you record a deed there is a fee for the recording and an excise tax (typically). If you didn’t record the deed, there would be no penalty for not having paid the recording fee. There would be penalties for not having paid the excise tax.

    There is no excise tax due on the recording of the assignment of a deed of trust. The recording is only done to protect the assignee–to impart notice, and it may not even be necessary because it may very well be that the UCC controls, not the real estate recording statutes (at least in Washington).

  17. 17

    By Pegasus @ 14:

    Several courts have already refused to allow the MERS games to continue in their states.

    Please find such a decision. And a decision that MERS is not the party in interest doesn’t count. I’m looking for a decision that says MERS assignments don’t work.

  18. 18
    One Eyed Man says:

    RE: Pegasus @ 14

    “That said he was far more correct than your constant inaccurate statements here that that there really is nothing or little going on with the banks and their practices.”

    That’s a grossly inaccurate characterization of what I’ve said Pegasus. I told you in the very beginning that the banks paper work was often bad and what the robo-signers did was probably perjury. But it wasn’t a cover up or a conspiracy to steal peoples houses. It was classic capitalist shortcuts to try and gain a competitive advantage through efficiency. Wray uses the same analysis of economic externalities that I use. I just think he fails to acknowledge that the blame goes to the very nature of capitalism because it rewards the creation of externalities to shift risk and costs and create alpha.

    I’m not saying capitalism isn’t the best available choice of economic systems. I am saying that regulation is necessary to avoid the externalization of risk and costs that create a misallocation of capital. TBTF is an externalized cost and a subsidy that rewards the big banks. The banks tried to move to a more efficient model of securitization and automation without getting the real property laws of some of the states changed to accommodate their new system. To some degree Wray actually agrees with me about that. Unfortunately the securitization model was ill conceived and contributed to the separation of potential risk and reward that helped create the huge misallocation of capital we refer to as the housing bubble and the credit bubble. But when he starts talking about conspiracy to steal peoples houses he’s talking through his tin foil hat.

  19. 19
  20. 20
    Pegasus says:

    By Kary L. Krismer @ 17:

    By Pegasus @ 14:

    Several courts have already refused to allow the MERS games to continue in their states.

    Please find such a decision. And a decision that MERS is not the party in interest doesn’t count. I’m looking for a decision that says MERS assignments don’t work.

    Ask and you shall receive:

    http://foreclosuredefensenationwide.com/?p=194

  21. 21

    By Pegasus @ 20:

    By Kary L. Krismer @ 17:

    By Pegasus @ 14:

    Several courts have already refused to allow the MERS games to continue in their states.

    Please find such a decision. And a decision that MERS is not the party in interest doesn’t count. I’m looking for a decision that says MERS assignments don’t work.

    Ask and you shall receive:

    http://foreclosuredefensenationwide.com/?p=194

    Nope, that NV bankruptcy case is a standing case–saying MERS doesn’t have the authority to act in court (and on reading the entire decision, that much of what they were claiming wasn’t proven with adequate evidence). Nothing in the decision says that MERS assignments don’t work, despite the author of the site you linked to trying to claim more than what is there.

  22. 22
    Pegasus says:

    By Kary L. Krismer @ 21:

    By Pegasus @ 20:

    By Kary L. Krismer @ 17:

    By Pegasus @ 14:

    Several courts have already refused to allow the MERS games to continue in their states.

    Please find such a decision. And a decision that MERS is not the party in interest doesn’t count. I’m looking for a decision that says MERS assignments don’t work.

    Ask and you shall receive:

    http://foreclosuredefensenationwide.com/?p=194

    Nope, that NV bankruptcy case is a standing case–saying MERS doesn’t have the authority to act in court (and on reading the entire decision, that much of what they were claiming wasn’t proven with adequate evidence). Nothing in the decision says that MERS assignments don’t work, despite the author of the site you linked to trying to claim more than what is there.

    Did you bother to read this one:

    “Idaho Bankruptcy Court has held that purported assignments of the Note in a MERS assignment of mortgage is ineffective”

  23. 23

    RE: Pegasus @ 22 – That’s not a case, that’s a claim on a webpage that doesn’t cite to a specific case. And the case it does specifically cite to it misstates the holding of the case.

    If you can find the name/number of the Idaho case I’d be willing to give it a look. But I need something more than Idaho bankruptcy court.

    That’s the problem with a lot of the reporting on these cases. They grossly overstate the holdings. For example, the recent Mass. case, although it deals with foreclosures from a few years ago, after reading the case I doubt it affects many foreclosures because the prior foreclosures would have had to contest the actions taken. I’ve yet to see that mentioned in an article–instead they try to hype it like the press is hyping birds falling from the sky.

  24. 24

    RE: zipzippygc @ 7

    This Whole Federal Deficit Game to Prop Up RE Prices is a House of Cards

    It clearly doesn’t work when companies aren’t currently hiring and banks aren’t currently lending [without government motors Freddie and Fannie], just absorbing money to cover their past losses to justify their brainlessness.

    Yes, stocks are doing well with a lean job market, and the longer domestic service/manufacturing/government productivity stays about the same [or even goes up] with drastically less American workers on board than a few years ago; it clearly tells me something horrifying [that I knew was going on since 1980 when we trended double incomes from single incomes per household]….we don’t need all those workers, we over-hired in the past and mostly pretended we were all busy. You’ll never hear most American workers honestly admit, “I have nothing to do”….even if it’s intuitively obvious.

    Remember the dot com boom in the 90s with yahoo, ebay, etc all going on a hiring spree? Just what were they doing in those cubicles? I hear the Plenty of Fish personals web site is making like 100s of millions profit and guess what…..its automatically computer ran by just a CEO [shuffling in all the cash] and a secretary, period.

    Its like the buffoons that tell us Americans must now invent stuff like rocket ships in their garages and this will be the new manufacturing in America? We invent it with one worker and China hires a 1000 workers to make it….LOL

    We’re doomed. I had hoped after the 1962 World’s Fair that America was going to a 20 hr work week [with the same pay and benefits] with automation and such….it was the answer, but greedy corporist globalism threw a spear in our national domestic heart. Now we eat crow.

  25. 25
    Pegasus says:

    DC Puts Its Bankster-Friendly Solution for Foreclosure Fraud on the Table

    “So by looking at this proposal, we are looking at the state of play among high level policy makers in DC, particularly of the New Dem bent. This is how the administration will probably try to play foreclosure-gate.

    Their proposal, not surprisingly, is yet another bailout.

    The big difference between the original and the new, improved version of the bailout model is that the payouts to the banks were at least in part visible the first time around. This is an effort yet again to spare the banks any pain, not only at the cost of the rule of law but also of investor rights.

    This proposal guts state control of their own real estate law when the Supreme Court has repeatedly found that “dirt law” is not a Federal matter. It strips homeowners of their right to their day in court to preserve their contractual rights, namely, that only the proven mortgagee, and not a gangster, or in this case, bankster, can take possession of their home.”

    http://www.nakedcapitalism.com/2011/01/dc-puts-its-bankster-friendly-solution-for-foreclosure-fraud-on-the-table.html

  26. 26

    RE: Sniglet @ 4

    Yes Sniglet, I’d Add Our “Foreign Controlled MSM” Keeps Lying About the American Foreclosure Mess to Keep Us Buying Their Junk Anyway [IMO]

    2008 MSM:

    “…At this time, the firm projects an extended period of deterioration before the housing market bottoms sometime in mid-2009….”

    http://www.structuredfinancenews.com/news/185388-1.html

    2009 MSM:

    “…U.S. foreclosures will peak in the second half of 2010 and home prices will continue to decline through the end of that year, according to Barclays Capital….”

    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aAsDvrWg4aJI

    And now, do we believe the chronic “Peter Crying Wolf Again” 2010 MSM:

    “…The number of U.S. homes receiving a foreclosure filing will climb about 20 percent in 2011, reaching a peak for the housing crisis…”

    Believe everything you read, it’s written by highly educated/paid economists and business men from like Havard. LOL, a cheap uneducated fortune teller would have a better track record on foreclosure predictions than these MSM buffoons. Fire all these incompetent foreclosure experts, we don’t need ’em.

  27. 27
  28. 28
    One Eyed Man says:

    RE: softwarengineer @ 24

    Some Russian summed up the old soviet economy in one sentence. He said “We pretend to work and they pretend to pay us.”

    I believe in science and scientific method. And from a Darwinian standpoint, I believe that capitalism is probably better because it adapts fairly quickly to survive. But as capitalism conquers the globe, under utilized, low cost labor markets draw the jobs until global labor costs and supply reach equilibrium. Our job losses are the real price of cheap big screen TV’s (along with any scarce and/or non-renewable natural resources they may consume).

    Eventually the Chinese and other similarly situated populations will make enough wages to buy consumer goods and help support a bottom to our jobs drain. But theoretically the ones who get rich in the long run will be the ones who control natural resources as the average human consumes more. (Population doesn’t have to increase to cause scarcity if the percentage of the population who have resources to compete for the supply of any good, service or job increases. If that isn’t part of your population thesis SWE, it should at least be a corollary.)

    Even if we fix our other economic problems, we’re still left paying more for natural resources that are in increasing demand, and receiving less for our labor due to the huge underutilized international labor pool. Those are the real reasons that Scotsman’s bearish thesis might be right in the long run. The global success of capitalism will decrease our standard of living as our labor market which had commanded a premium, is commoditized and moves to equilibrium over the globe. Our leaders wanted to bring free market capitalism to the world. Now that we’ve succeeded, the real cost could be your job, or at least a decrease in your wage rate and an increase in the price of scarce commodities that are now in demand by an additional two trillion people.

  29. 29
    Pegasus says:

    RE: One Eyed Man @ 28 – Your theorum about commodity prices being driven up because they are now consumed by an additional “two trillion people” when the world population is about 6 or 7 billion is flawed. The real current explosion in commodity prices is blatant manipulation funded with easy access to speculative monies provided by idiotic things such as bailouts and QE2. Markets are cornered again and again with the CTFC pretending all is OK while banks such as JP Morgan end up owning 80 percent of the copper contracts. I admit that an increasing population and one that consumes more will affect future prices but that has nothing to do with reality in todays market. It is all about manipulation and no one in power will stop it. You can take a look at the Baltic Exchange Dry Index plummeting as proof of no real demand. Only manipulators at work destroying the worlds economies. Food riots, etc.

  30. 30

    RE: One Eyed Man @ 28

    Yes One Eyed Man

    Both water and energy should be used wisely, even with improbable but necessary world/American depopulation.

    America needs what’s left of it’s water table not for population growth, or it’s dooming it’s bread basket of the world [it already has, America is importing food now]. Adding more energy pig N. American and European population types to the planet won’t work either….if the whole 7 billion planet earth ate food like N. Americans, it would take every drop of oil produced today just for food…..no more cars, plastics or heat.

    I’ve always knew depopulation alone is just part of the equation this century, especially since it takes theoretical decades [generations] to peacefully accomplish. I don’t want to be negative, but depopulation just ain’t gonna happen with our present staus quo….the other status quo brainless option is do nothing but promote more uncontrolled population growth and let famine, unemployment, disease and wars prune things down naturally….sooner or later at a theater near you too.

  31. 31
    Scotsman says:

    Yo, Trigger! Looks like I’m going to be doing some hiking- I won a lottery spot to hike Yosemite this July, a four day permit for the high country. I’ll be relaxing while the economy continues to wander like a drunken sailor on a narrow dock. I’ll send ya good thoughts.

  32. 32
    Pegasus says:

    RE: Scotsman @ 31 – Watch out for those thunderstorms when up high on that granite! Were you up there last year?

    http://www.youtube.com/watch?v=OQSNhk5ICTI

  33. 33
    Scotsman says:

    RE: Pegasus @ 32

    This is my first time- pretty excited about it. A most excellent adventure awaits!

  34. 34
    One Eyed Man says:

    RE: Pegasus @ 29

    While QE and speculation are factors driving commodity prices, I disagree that they are the primary long term drivers. In the short term, dollar destruction and speculation are big factors, but they aren’t continuous factors pushing for increasing demand like the industrialization of China, India and other BRICK countries.

    Blaming the largest portion of the current long term trend in commodity prices on QE is short sighted. The drop of the dollar index from 115 eight years ago to its current low of about 80 is about a 30% decline in the purchasing value of the dollar. During that same period, oil prices and copper prices have increased 400%. While the spikes and retreats of the spot price might be due to the bankers, speculators and manipulators, the long term trend is far more likely driven by increasing demand in the emerging markets like China.

    If you’re trying to tell me that markets are filled with lemming driven momentum plays that lack fundamental substance, you’re preaching to the choir. I agree with you 100%. That’s why I think that mark to market is the false mesiah. Mark to market doesn’t just deflate bank balance sheets on the way down. It also inflates balance sheets on the way up and justifies bank lending to build an ever bloating bubble.

    Regarding demand growth, China started importing oil in about 1993. It became the second largest consumer of oil a few years ago when it moved ahead of Japan and its consumption while currently about 8 million barrells per day compared to 20 milliion barrells for the US is growing significantly faster. Over the last 8 years oil consumption in the US has been basically flat. In China, consumption has increased about 60% in that period and is expected to continue to increase at a pace of about 7% or more per year.

    While I may have inadvertently said trillion instead of billion in reference to the ever increasing portion of global population driving demand, the error is irrelevant to the underlying analysis.

  35. 35
    Haybaler says:

    RE: softwarengineer @ 30
    SWE,

    I’m a regular participant in a segment of North America’s agricultural industry.

    When I read some of the statements you publish regarding commodity prices and food supply I wonder what happened when I wasn’t looking……tending to read you like an authority….because I think you make sense most of the time.

    The reason I’m confused is because my experience and knowledge of ag markets is in contradiction to things that you suggest are occuring. For example, this current statement “the US is importing food”…..because of local shortages just isn’t so. Like many industries, ag corporations are international now. Sure we import huge quantities of beef from Argentina and Mexico. It costs those corporations less to grow pounds of protein in those countries than it does here. Fruit and Vegetables are in demand by consumers year-round. It used to be that we only bought them “in season”. With corporate expansion has come the ability to supply, for example, strawberries all year.

    I don’t see us ever being in a position of facing mass starvation due to the global supply system that is developing.

  36. 36
    One Eyed Man says:

    RE: Pegasus @ 32

    One of my old house mates from the 70’s was in a lightning storm while scaling Halfdome. It was night and they were sleeping in hammocks hanging on the side of the cliff and the lightning was traveling just off the face of the rock right past them. He was a Berkley freak from the 60’s who almost never wore shoes except to work because they forced him to. Even so I don’t think he was as high as the guy on the video. ;-)

  37. 37
    Pegasus says:

    RE: One Eyed Man @ 36 – I posted that because in Yosemite lightning can mean death. As i am one whom seems to attract lightning especially in my youth and after reading about the deaths in Yosemite caused by lightning, it was the reason I posted my warning. The guy in the video claims it was a natural high.

  38. 38
    Pegasus says:

    RE: One Eyed Man @ 34 – Never said that the manipulation was a long term problem. It is just a sign as to how low our nation has sunk when they won’t prosecute the manipulating big crooks. No matter what excuse you make up for their fraudulent behavior the fact remains that a growing number are realizing you are spreading bunk information designed to protect the criminals. It is not too late to leave the darkside and join those willing to point out the criminals for what they are. You have the talent. DO IT! NOW! As always the choice is yours.

  39. 39
    pfft says:

    commodities are spiking because of increasing demand. it’s not just the dollar. countries like china and india have higher inflation rates. ours is low.

  40. 40
    Pegasus says:

    By pfft @ 39:

    commodities are spiking because of increasing demand. it’s not just the dollar. countries like china and india have higher inflation rates. ours is low.

    You are a proven IDIOT! Did Baloneyman Krugman tell you post that nonsense? There is NO demand….only fools like you singing nonsense. Why?

  41. 41
  42. 42
    pfft says:

    By Pegasus @ 40:

    By pfft @ 39:

    commodities are spiking because of increasing demand. it’s not just the dollar. countries like china and india have higher inflation rates. ours is low.

    You are a proven IDIOT! Did Baloneyman Krugman tell you post that nonsense? There is NO demand….only fools like you singing nonsense. Why?

    the global economic recovery is increasing demand for commodities. how do I know this? the price is going up.

  43. 43
    pfft says:

    China will use about 19 million metric tons of aluminum this year, Alcoa said. Europe, the second-biggest market, will consume about 6.9 million tons, the company said. Alcoa estimates global demand will expand 12 percent this year, compared with 13 percent in 2010. Use in Asia excluding China will increase 15 percent, from 10 percent last year, it said.

    http://www.bloomberg.com/news/2011-01-11/alcoa-expects-sales-headwinds-as-china-seeks-to-tame-inflation.html

    Rising demand from emerging markets like China, along with a weaker dollar, is driving up the cost of commodities. With unemployment stuck above 9 percent, companies are finding limited scope to raise finished goods prices, allowing the Federal Reserve to complete a second round of monetary easing to stimulate the economy.

    “The improving economic sentiment in the U.S. and across the world is putting pressure on commodity prices,”

    http://www.bloomberg.com/news/2011-01-12/import-prices-in-u-s-rise-1-1-in-december-led-by-fuels-food.html

    sure there is some speculative money chasing commodities but they are doing it because there is fundamental demand. if speculation is getting to be too much then prices will settle back down.

  44. 44
    pfft says:

    This morning, JPMorgan upgraded shares of Deere from neutral to overweight as farm demand should continue to show improvements with the economy.

    http://www.forbes.com/2011/01/13/analyst-moves-de-gd-marketnewsvideo.html

  45. 45
    corncob says:

    By Pegasus @ 40:

    You are a proven IDIOT! Did Baloneyman Krugman tell you post that nonsense? There is NO demand….only fools like you singing nonsense. Why?

    The world is bigger than just the USA, global demand for commodities will only increase from here on out barring nuclear war. There is just somewhat (but not much) less demand from our chunk of the planet. The recession and its effects are not universal by any means, sectors and segments of people in the US economy are doing fine or even better than 2007, even though those at the bottom or in areas like manufacturing/construction/services/etc are getting thrown under the bus. China and India have slowed growth, but are still growing considerably. Some poor shmuck in the US going from a sales job to unemployment does not decrease aggregate demand anywhere near enough to offset the 5 middle class Chinese buying their first cars at the same time.

  46. 46
    One Eyed Man says:

    RE: Pegasus @ 38

    ” you are spreading bunk information designed to protect the criminals. It is not too late to leave the darkside and join those willing to point out the criminals for what they are.”

    I may be naive and perhaps ill-informed Pegasus, but unless I’m completely possessed by self delusion (which given my past isn’t entirely out of the relm of possibility) I don’t envision myself as intentionally malevolent.

  47. 47
    EconE says:

    RE: corncob @ 45

    So you’re saying that it’s strictly demand and not hot money?

    You’ve claimed quite a bit. How about some hard numbers to back up your assertions.

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