Posted by: Timothy Ellis (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.

26 responses to “Seattle-Area Adds More Jobs, Unemployment Dips Below 526”

  1. Dave0

    The local Seattle economy is getting a bit too hot I think. It needs some tightening through monetary or fiscal policy, but that isn’t going to happen at the national (or even state) level because their unemployment rates are still too high. There is no way to change monetary policies at the local level, but some fiscal policies could be implemented. It’s time to raise taxes locally to build up the city and county coffers. This will stabilize the economy locally as well as create a nest egg that local governments can rely upon in the future.

    Rate this comment: Thumb up 7

  2. Blurtman

    The Tim,

    Please alo include a discussion of the labor force participation rate for completeness. And no, I am not saying that it is also not seeming to improve, but just discussing the unemployment rate without also discussing the LFPR is like cheering the decrease in water coming into your boat while it continues to sink, nonetheless.

    Rate this comment: Thumb up 10

  3. Ira Sacharoff

    By Dave0 @ 1:

    The local Seattle economy is getting a bit too hot I think. It needs some tightening through monetary or fiscal policy, but that isn’t going to happen at the national (or even state) level because their unemployment rates are still too high. There is no way to change monetary policies at the local level, but some fiscal policies could be implemented. It’s time to raise taxes locally to build up the city and county coffers. This will stabilize the economy locally as well as create a nest egg that local governments can rely upon in the future.

    Unfortunately, if the city raises taxes, it won’t be to build up their coffers and build up their nest egg( at least in Seattle). They would raise taxes in order to provide a subsidy to some billionaire so they can build a stadium, or for another billionaire to build expensive apartment buildings, or to put in streetcar lines, or bike paths, or to make sure that every city issued news release has the word “sustainable” in it.

    Rate this comment: Thumb up 23

  4. ChrisM

    RE: Blurtman @ 2 – Related, SNAP/food stamp usage is also a proxy for the health of the economy.

    Rate this comment: Thumb up 1

  5. Blurtman

    RE: Ira Sacharoff @ 3 – The SBC ( Seattle Billionaires Club) has arranged the temporary release of Mr. Whitey Bulger, who wold like to meet with you shortly to learn more about your controversial viewpoint. Accompanying him will be a “Chechen lawyer,” to take care of any loose ends. They look forward to meeting you soon. Goodbye.

    Rate this comment: Thumb up 2

  6. David Losh

    RE: Dave0 @ 1

    I don’t see where they could raise taxes any more than they already have.

    There might be some sweet heart taxes, like on billionaires, or people over a certain income of $500K, but that would take an income tax.

    The way our tax system is, in Washington State, businesses take the brunt of the tax increases, and pass the increases on to you, the consumer.

    I don’t see tax increases as sustainable that way.

    Rate this comment: Thumb up 3

  7. Chris

    Ira, Lesser Seattleite are you?

    Rate this comment: Thumb up 0

  8. corndogs

    RE: David Losh @ 6 – Hey, the other day you said

    “All of the reports, statistics, market trend lines, and over all market analysis have fallen.”

    Did you say that just because you are retarded? Or do you know something everyone else doesn’t know?

    Rate this comment: Thumb up 2

  9. David Losh

    RE: corndogs @ 8

    Hope springs eternal for those that have money tied up in an investment.

    Even if the trend line comment wasn’t true before, it’s true now.

    Look up your own data, and see what market conditions are.

    First we have the end of the Spring selling season, and second is that data changes with any, or all sales data.

    Tim posted his with a little lag, but with rising mortgage rates? You don’t see a trend coming? and that’s just rising mortgage rates, that are today at 4.25%.

    You also ignore the broader financial markets in favor of some odd belief that residential housing units will continue to go up in price. Even the Board of Realtors is having doubts.

    I got my trend line data from county tax records. You are correct that after making the statement the trend lines moved up slightly because of some of the closed sales that got recorded, but the trend is still there. We’ll see at the end of this month where it is.

    Oh, and I’m only interested in my own business, my own market.

    I posted the last Rick Santelli rant on the Open Thread, because he made some excellent points about data. We never had data in the past, like we have today. You seem to be making broad assumptions about future values based on sales data alone. It’s meaningless in investing unless you can capture the volatility. You can buy, and sell stocks quickly, and easily, pay the fees, and move on, Real Estate is much harder to capture.

    So if you bought into a period of time that had exuberance based on the Fed lowering interest rates, and that sales data is all you have to go by, you may well be stuck.

    Those are my opinions, and yes, I do make money based on my opinions, but it’s my money, my opinions. If you have some magic formula you would like to share, do that.

    Rate this comment: Thumb up 0

  10. Erik

    RE: David Losh @ 9
    This is a way to deflect admitting you are wrong. I see you do this to me and to others all the time. When you are wrong, you suddenly become too busy to get involved in confirming data and things of that nature. I think the point is that we would like you to stop popping off with incorrect statements. Supposedly you are a big success, but I would never guess it reading your statements. Not saying you aren’t, but your statements are often incorrect. Honey boo boo is a big success, so who knows, you could be too.

    Rate this comment: Thumb up 0

  11. David Losh

    RE: Erik @ 10

    As I say, prove me wrong rather than pop off.

    You guys want your housing units to go up in price, and seize on anything that might prove that. It’s just not happening, it’s not going to happen in the future.

    It’s like you making another statement on the income thread, because you don’t look at Seattle incomes. We have a lot of $100K positions here in Seattle that not everyone enjoys.

    I look at data, and insulting me because I’m not feeding your ego isn’t proof of anything.

    The data is in King County Records, look it up.

    In terms of broader market trends, if you didn’t see the Bernanke announcement coming then there isn’t really anything I can say about that, but the markets made their own hedges long before yesterday.

    I’m more than happy to go head to head with you guys.

    Rate this comment: Thumb up 1

  12. Erik

    RE: David Losh @ 11
    Do you see this curve?
    http://seattlebubble.com/blog/2013/05/24/low-rates-prop-up-affordable-home-price/

    It seem very probable to me that the median home price will catch up to the affordable home price as it has in the past. This means a temporary accelerated housing price increase. After the median home price catches up with the affordable home price, housing prices should increase as they have in the past.

    You are getting caught up in the fear and suggesting the these rules have changed permanently and people will no longer buy what they can afford in the future. That doesn’t make any sense to me and I don’t see how you can come to a different conclusion.

    The affordable home price line will perhaps slightly decrease in slope, but nothing like you are claiming it will. I heard about 1% a year of increased interest rates. That shouldn’t have a large effect on housing prices.

    You asked for it and I just proved you wrong. There is not absolute proof, but that seems to be a very likely scenario. Much more likely than you claiming economics have suddenly changed and this is not longer valid.

    Rate this comment: Thumb up 0

  13. corndogs

    RE: David Losh @ 9 – “As I say, prove me wrong rather than pop off”

    No one has to prove you wrong, you are a walking random word generator, who takes away from the value of this site because your brain is putrid pate. You really ought to go back to your personal blogs where you have pages and pages of garbage content and not a single person responding to it. You have nothing accurate, interesting or helpful to add here, but you insist on manifesting your unworthiness. You’re one of those personalities that value a punch in the face as much as a nod of approval… like a dog after you get kicked you crawl under the coffee table and lick your balls for an hour or two, but inevitably come back for more hoping to get your belly scratched…. well, Corndog just got off work and still has his boots on, so guess how todays gonna turn out.

    Rate this comment: Thumb up 3

  14. Matthew

    Erik,

    That might have been the biggest epic fail of a conclusion ever. This entire market is only hanging on because the Fed has provided liquidity. There is no real recovery in the economy, stock market, or housing. This is all part of an echo bubble created by the Fed in one final attempt to make the banks whole before the final bag holders are hung out to dry. If there was a real recovery why would the equity markets fall so dramatically just on the mere thought the Fed may begin tapering its asset purchases?

    If you think the current situation remotely resembles anything in the past 50 years you are going to be in for a rude awakening.

    The top is in my friend GTFO of this market while you still can.

    Rate this comment: Thumb up 7

  15. Kilen

    The comments at this blog are getting boringly predictable. Oh well.

    Tim — thanks for the posts, they’re always appreciated.

    Rate this comment: Thumb up 1

  16. Erik

    RE: Matthew @ 14RE: Matthew @ 14
    So you think when interest rates go from 4% to 6%, you think median house prices will be drastically affected? Robert Shiller said when rates come up from super low, historically housing prices are not affected. Tim Ellis has also said he doesn’t see housing prices decreasing much when interest rates go from super low to low.

    I have seen you make intelligent comments before. It surprises me that all of a sudden you think the rules of housing have changed forever. I am a math and science guy. I suspected you were too from your profile pic. I expect drug users like Losh to not be able to connect the dots, but I figured you’d come to the same conclusion as I did. When Losh comes up with a different conclusion, I understand because he is not a logical person that is able to understand graphs and data. You have a graph on your profile, so I assumed you were a math guy like me.

    That said, I do plan to GTFO in February 2014. I think we are in for flat prices for a while, but I don’t think there is another bust coming up.

    Please tell me why you think things have suddenly changed and the economic fundamentals no longer apply.

    Rate this comment: Thumb up 0

  17. Macro Investor

    By corndogs @ 13:

    RE: David Losh @ 9 – “As I say, prove me wrong rather than pop off”

    No one has to prove you wrong, you are a walking random word generator, who takes away from the value of this site because your brain is putrid pate. You really ought to go back to your personal blogs where you have pages and pages of garbage content and not a single person responding to it. You have nothing accurate, interesting or helpful to add here, but you insist on manifesting your unworthiness. You’re one of those personalities that value a punch in the face as much as a nod of approval… like a dog after you get kicked you crawl under the coffee table and lick your balls for an hour or two, but inevitably come back for more hoping to get your belly scratched…. well, Corndog just got off work and still has his boots on, so guess how todays gonna turn out.

    All I can say is WOW. You called someone a “random word generator” then launched into one of the most bizarre rants ever seen.

    You and Erik are the ones who need to go away. You are obviously posting high on something and off your prescription meds. Eric is such an obvious shill for selling his worthless condo. As if someone with a 40 IQ would even think comments on this blog can actually move the market. Both if you, kindly go away and leave everyone alone.

    Rate this comment: Thumb up 9

  18. Erik

    RE: Macro Investor @ 17
    I have a masters degree in mechanical engineering from UW and my gpa is above 3.5. I did this all while doing stress analysis at Boeing for their new composite airplane. You can dislike me, but you certainly cannot call me stupid. I think I have earned the respect not to be called stupid. Maybe we are too advanced for you.

    Here is my guess on your situation… You are similar to the other blogger 3rd generation. You are a trust fund baby and you are not intelligent. You haven’t had to use your brain to keep your wealth, so you live with in a false reality that you are smart and successful. In reality you have been handed success and it is your job to let your intelligent advisors tell you what to do. Feel free to set me straight, but that is what I concluded based on your comments.

    I think referring to me as “Erik” and then in the next sentence referring to me as “Eric” with a “c” is very telling. I am not trying to get you on a small technicality, but my brain wouldn’t let me do that, because it makes no sense. Do you see what I mean? People are different and you are not an analytical person that can understand complex things. I can if I am given the right data.

    These inconsistencies you have are not the traits that I would like for my financial adviser. Would you?

    Rate this comment: Thumb up 0

  19. David Losh

    RE: corndogs @ 13

    There’s nothing in your comment to respond to, but it is entertaining.

    You made one comment that I recall that had any substance, but it was confused in it’s conclusion.

    What you are missing here is the aspect of deflation. Bernanke has kept deflation at bay.

    Until I started reading this site, and in particular the comments by Michael Surkan (sp?) I never considered deflation. Now it seems to me he was right. It was a long time coming, but I think we’re there. It was even mentioned in the responses to Bernanke’s comments.

    I don’t think you get what that means, or what the broader financial markets are showing. We’re going to be paying less, because we make less money.

    You might have a job, and I may have a business, but a lot of people are struggling with less money. Having less money means spending less money, unless you are taking on more debt due to that consumer confidence.

    Anyway, I have two comments left on this thread, I like the comment limits, but I comment here because I get business from this site. It seems a little unfair to me that I don’t pay for the advertising here, but would be happy to take a year contract for the site.

    My sites are set so that I’m not monitoring comments from people like yourself. There’s no point to it. Tim has a job related to this site, I have a business separate from my life long interest in Real Estate. My interest in Real Estate has waned somewhat, but I still have Real Estate matters to finish.

    It’ll be interesting to see how it all shakes out.

    Rate this comment: Thumb up 0

  20. Matthew

    Erik,

    I was off by only one or two months as to my prediction of the last market top. If you do a search you can find it on here somewhere. Despite the fact that Kary always pontificated about how you can’t predict the future you can make educated guesses.

    What is currently fueling the resurgence in housing right now? A strong economy? Rising wages? Or is it artificially cheap money and large investors (hedge funds) soaking up the excess inventory?

    In a normal recovery, rising rates are an indicator of rising inflation brought on by rising wages. The situation now is different in that rates are in fact artificially suppressed due to the Fed unprecedented purchasing of trillions of dollars of goverment bonds.

    It’s all a big experiment that has never been done before. It’s not real, and no one knows the final outcome. It’s akin to playing a new casino game. Throw the charts out the window of the last 100 years because we are in uncharted territory.

    I’ve said this in the past and I will say it again. I will believe in a real housing recovery when the Fed ceases to purchase 85 billion dollars a month in goverment bonds that mostly consist of MBS. The Fed is the lender of last resort right now and is backstopping the entire market. Just the thought of their exit sends the equity markets plummeting.

    And you think this is a real recovery?

    Rate this comment: Thumb up 12

  21. erik

    RE: Matthew @ 20
    I was unable t o predict the top last time. I didn’t read seattlebubble back then and I was younger and dumber.
    Katy is an educated idiot. He can understand the rules, but he can’t see or understand the bigger picture. You would be a fool to listen to him. Low interest rates is ultimately driving housing prices up in my opinion. Take away that and hedge funds wouldn’t buy and inventory wouldn’t be so low.
    I agree that this recovery is based on the government stepping in. That said, the only part we disagree on is the outcome. I think the Fed will slowly raise rates so that it doesn’t effect housing prices dramatically. Prices would plummet if all of a sudden interest rates went way up. That won’t happen. Rates will increase slowly and price increases will slow to equal inflation. No boom and bust. Small boom and slow growth is most likely.

    Rate this comment: Thumb up 0

  22. Jay

    I think David and Mathew have very good points! I’m surprised that some of the well maintained houses in top schools neighborhoods are siting for a month without pending! Whereas a couple months ago, they would be pending right away!

    Rate this comment: Thumb up 0

  23. Macro Investor

    RE: Macro Investor @ 17

    “I have a masters degree in mechanical engineering from UW and my gpa is above 3.5.”

    Flunked 5th grade grammar though, LOL!

    Sorry, son — bragging on the internet = no credibility.

    … And yet you think trying to influence the small number of readers here will move the market price of your worthless condo. That’s some major analytical skill, LOL.

    Rate this comment: Thumb up 0

  24. Macro Investor

    RE: erik @ 21

    @Matthew

    “Despite the fact that Kary always pontificated about how you can’t predict the future you can make educated guesses.”

    @Erik/c

    “Katy is an educated idiot. He can understand the rules, but he can’t see or understand the bigger picture.”

    @Erik/c

    “I think referring to me as “Erik” and then in the next sentence referring to me as “Eric” with a “c” is very telling. I am not trying to get you on a small technicality, but my brain wouldn’t let me do that, because it makes no sense. Do you see what I mean? People are different and you are not an analytical person that can understand complex things. I can if I am given the right data.

    These inconsistencies you have are not the traits that I would like for my financial adviser. Would you?”

    Congrats, loser. You proved my point. Now go away and stop bothering everyone.

    Rate this comment: Thumb up 0

  25. whatsmyname

    Sorry, son — bragging on the internet = no credibility.

    From “Macro Investor”

    Irony meter hits 100.

    Rate this comment: Thumb up 0

  26. Voight-kampff

    This blog has devolved into the last few drunk guys at a party trying to win over the last remaining woman by flaunting their magnificent plumage.

    Rate this comment: Thumb up 5

Leave a Reply

Do you want a nifty avatar picture next to your name, instead of a photograph of Tim's dog? Just sign up with Gravatar, and make sure to use the same email address in the form below. It's that easy!

Please read the rules before posting a comment.

You have 5 comments remaining on this post.

Archives

Find us on Google+