The United States Economy for Nineties Kids

Or, What the Fuck Do You Mean, ‘It’s Not Fair?’

There’s something that I’ve heard a lot of people talk about. They’re not wrong, but they are missing the point quite dramatically.

I was born July 10, 1990. I grew up in one of the poorest cities in the country. It’s been the poorest for several years running. You know it, you love it. Detroit’s not a place I’m proud of, and I don’t particularly identify with it. I think everyone I know personally wanted to get out of this cesspit years ago.

I can say without special pride that when I was younger, in my school-age years, everyone I know said I was talented. I was always the smartest guy in the room for my age group. I could throw a football better than most people I knew, though I never did anything with that. Once someone described my singing voice as “the best voice they’d ever heard.” I was the best artist in my grade through middle school, when I stopped working at it.

I didn’t earn those talents. I was given them. Frankly, I squandered them. And that’s why I don’t feel as if I’m bragging when I say it.

I had always heard, you get out of high school, get a summer job, go to college, get started on a career. Well, I fucked around in school. Got a 31 on my ACT my first try, and graduated with a 2.8 gpa. I didn’t turn my bad habits around until the 2nd semester of my 3rd year in high school, and by then the damage was done.

So no ‘real’ school would take me. But I was committed to getting a job and making sure that I could pay something towards my schooling before I went to school. Three years later, I was sitting in an interview for McDonald’s. I’d applied to every business I could get to on my bicycle that wasn’t pure manual labor, but this was only my 4th interview, because a 18/19/20-year-old unemployed white boy in Detroit hasn’t got a whole lot going for him.

The woman ignored me for most of the 15 minute interview, repeatedly getting up and walking away from the table to go talk to other people. I can’t explain how angry I was. At the end of the interview, I asked her how I could improve myself, to become a better candidate. You know what she said to me?

She said that not going to school had made it look like I wasn’t “serious.”

Here I was, trying to do the right thing, to look before I leapt, and now some regional manager who couldn’t be bothered to put 15 minutes together for an interview without running off to talk to three separate people, was telling me, a talented, smart, strong, capable… You get the idea.

Well, I took the risk. I applied to U of M Flint, hoping to get into engineering, since that was all I’ve wanted to do for years. They weren’t interested. I didn’t show promise with my grades, but they did have a program for people who had done poorly in school like me, but wanted to turn things around.

Go to Henry Ford Community College, right next door, for 2 years. Get good grades, and come back with an associates and I’d be in like Flynn. I went to school. My priorities changed, though. I realized that I’d been running away from who I really was. That engineering was something I’d like, but I had been avoiding my passion for coding because my father was a programmer and I have strange issues about retreading paths.

That’s a stupid reason to avoid what you like doing.

So I dropped the engineering schedule and started over, took some coding classes.

And that’s when I learned, not in class of course, the most valuable lesson of my life so far. Something I think every millennial, every “nineties kid” needs to learn:

They’re not handing out money.

At least, not the way that they used to. Sure, you can get on Welfare. You’d think that growing up in Detroit I’d know more about that, but I’m not a huge fan of the program and I never was, even when I was a hardline socialist.

But the economy of the 1950s, 60s, 70s, 80s, 90s… The economy your parents know about, the economy your grandparents know about? That doesn’t exist now. In a very real sense, you live in the Wild West.

Things are changing, are evolving and shifting, so dramatically over the past 10 years.

There’s no place for stable, smart, head-down workers. You might get into a job like that, but 99% of them are taken up by someone else’s father, or grandfather. People more capable than you, with more experience. You think you’re hot shit, but the fact is that when you put a 20-year-old genius in the room with a 50-year-old veteran of no particular talent, the veteran is better.

This isn’t news to any of you, though.

You’ve lived in this world for 20+ years now. You’ve been unable to get work for 5 of them, except maybe shitty 28-hours-a-week jobs at local diners. You can’t raise a family on that. It’s not a career, and it will never be a career.

Which gets me to my point:

Don’t rely on other people to make a space for you because they won’t. You’ll get eaten up and spit out, and the truth is, you deserve it. Anyone who doesn’t adapt to their situation will fail and that’s not a bug, it’s a feature.

You need to carve out a space for yourself, and you need to work hard for yourself, to make your own name. Don’t just assume that someone else will do it for you because that’s how it worked for your mother and father.

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British Foreign Secretary Philip Hammond chaired an emergency meeting on the crisis on Monday evening, although British Prime Minister David Cameron is not expected to return from his summer vacation until Thursday, the U.K.’s Daily Telegraph reports. The U.K., which will fund an extra 100 guards near the terminal in France, has “got a grip” on the crisis, Hammond said following the 90-minute meeting, The Guardian reports.

There has also been a 50 percent increase in the number of unaccompanied children seeking asylum in Britain compared to this time last year, according to government statistics.

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progressive-economics.ca
The Progressive Economics Forum » Canada’s new recession and the push for alternatives

The Bank of Canada cut its benchmark interest rate two weeks ago to nearly record lows, now just 0.5%. In the face of an oil shock and other weakness, monetary policy is expected to do the heavy lifting of beating an economic funk. Today’s move reflects a poverty of economic policy from the ruling Conservatives and much of the political class.

Harper has been adamant that Canada’s downturn—now very likely a recession, about which his own Finance Minister  remains in denial—is the result of global forces. There’s nothing that can be done to counteract a host of external problems but to button down. The best a government can hope for is to maintain a fabled fiscal discipline.

However, there’s a disjoint between saying that policy couldn’t have been used to avert downturns like this one and screaming bloody murder anytime someone raises the prospect of even mildly activist, redistributive, old-school social democratic economic policy. If current policy is that ineffective, then perhaps it’s high time to try something else? “There’s nothing we could have done” is just a fatalistic cover for political choices. […]

I bought some gems from a user a couple days ago. This wasn’t the first time I’d bought gems, but it was the first time I’d interacted with this particular user. As always I pinged them, requested to buy an amount and listed the treasure cost just to confirm.

Typically when buying gems from any user they request payment first, a totally fair and understandable practice, and once reciwving confirmation I swnd them my treasure and they send a reply with the gema, pretty standard.

This person though, when they responded on the forums confirmed my math didn’t suck a big one and stated they were sending the gems right away.  Cool, fine with me, that’s pretty trusting. When I saw the response my inbox was still empty, so I just sent them a messags with my treasure and a thanks for letting me buy from them, again pretty standard and polite stuff. 

Right after the message was sent I saw a pm from them, the title just said gems and I can see the attachment is indeed exactly what it says on the tin, cool. Click on it expecting to see the usual thanks for doing business.

Nope. Just one line accompanied by the gems I requested and had swnt payment for. It reads, copied and pasted from the pm, “You know what you owe.”

Maybe they thought they were being funny or cute, fuck if I know, but it sure as shit didn’t come across that way to me. It just struck me as rude. I know what I owe? Are you some fuckkng mafia boss or something? Fuck you dude, I’m not buying anything from you again, that’s for god damn sure.

Jesus fuck. If that’s how you talk to people they won’t want to do business with you anymore. God knows I don’t. 

Let's talk minimum wage

By raising minimum wage employers have to raise prices and cut people because they need more money to pay their employees and keep their businesses going. So now with less people working you have far more people living miserable lives while a select few, who live better lives than the others. Keep minimum wage the same and you have more people living better lives than they would without a job. Plus having a low minimum wage allows for young people to get work experience that they can use later in life.

youtube

New Ad from the Conservative Party of Canada: Our Economy

They’re going to need to try harder than ‘he’s not ready’ ‘budgets will balance themselves’ and ‘he’s a career politician’. Also its laughable that the Conservatives are making an ad about how they’re champions of the economy, when we’re on the brink of plunging into a recession.

Well I think I can see why people are hyped for Clanheart. The art is at least 80% as good as Flight Rising’s, the layout is beautiful, there are a variety of genders other than Male and Female (and the owner and the site is openly LGBTQIA+ friendly).

I’m just really looking forward to seeing what Aywas and FR would look like if the best accent artists and the best custom artists had customisation/accent layering on steroids with NO awful shadow rules or awful edit percentages or coverage calculations or lineart limitations.

Maybe it will finally convince the FR admins to introduce non binary genders, user blocking and accent layering. Some time this century would be great, though hopefully the game won’t be as thoroughly expensive as its predecessors.

#davidmartyn #architecture #building #door #facade #old #sign #street #urban #village #window #bank #France #French #Europe #EU #euro #zone #eurozone #eurozone #finance #banking #crisis #economy #economics #credit #agricole #foap Check out my #blog and website www.soundimageplus.com via #soundimageplus

Americans between 18 and 34 are earning less today (after adjustment for inflation) than the same age group did in the past. A typical millennial averaged earnings of $33,883 (in 2013 dollars) between 2009 and 2013. That was down 9.3 percent (after adjustment for inflation) in just a decade and is the lowest since 1980. Older Americans have fared considerably better; earnings of all full-time workers were roughly flat between 2000 and 2011.

Still more striking is that millennials have endured falling earnings even though they have attended college in record numbers.
youtube

How To Avoid Excessive College Spending

College can be an expensive endeavor, but you might be able to save more than you think with these tricks.

Via UKDividend: Legal & General hikes dividend to 3,45 pence #dividend #ftse100 #legalgeneral http://twitter.com/STERLINGMHOLMES/status/628839989623816193

Via UKDividend: Legal & General hikes dividend to 3,45 pence #dividend #ftse100 #legalgeneral

— Sterling M Holmes (@STERLINGMHOLMES)

August 5, 2015


from Twitter https://twitter.com/STERLINGMHOLMES

August 05, 2015 at 01:08AM
via IFTTThttp://twitter.com/STERLINGMHOLMES/status/628839989623816193
wolfstreet.com
Liar Loans Pop up in Canada’s Magnificent Housing Bubble
Looming Collapse of Housing Bubble May Combine with Commodity Price Collapse to Create New Recession

For a long time, the conservative mortgage lending standards in Canada, including a slew of new ones since 2008, have been touted as one of the reasons why Canada’s magnificent housing bubble, when it implodes, will not take down the financial system, unlike the US housing bubble, which terminated in the Financial Crisis.

Canada is different. Regulators are on top of it. There are strict down payment requirements. Mortgages are full-recourse, so strung-out borrowers couldn’t just mail in their keys and walk away, as they did in the US. And yada-yada-yada.

But Wednesday afterhours, Home Capital Group, Canada’s largest non-bank mortgage lender, threw a monkey wrench into this theory.

Through its subsidiary, Home Trust, the company focuses on “alternative” mortgages: high-profit mortgages to risky borrowers with dented credit or unreliable incomes who don’t qualify for mortgage insurance and were turned down by the banks. They include subprime borrowers.

So it disclosed, upon the urging of the Ontario Securities Commission, the results of an investigation that had been going on secretly since September: “falsification of income information.” Liar loans.

Liar loans had been the scourge of the US housing bust. Lenders were either actively involved or blissfully closed their eyes. And everyone made a ton of money.

So Home Capital revealed that it has suspended “during the period of September 2014 to March 2015, its relationship with 18 independent mortgage brokers and 2 brokerages, for a total of approximately 45 individual mortgage brokers,” who’d together originated nearly C$1 billion in single-family residential mortgages in 2014. That’s 5.3% of the company’s total outstanding loan assets, and 12.5% of its total single-family mortgage originations in 2014.

That’s a big chunk. The company, however, didn’t disclose why it took so long to disclose this.

It said an “external source” had warned it about income falsification on mortgage applications submitted by a number of brokers. Its investigation did not find any evidence of falsified credit scores or property values, it said.

It’s not hard for a lender to require income verification. Not requiring it is precisely what US lenders had done before the Financial Crisis. Add a little encouragement from a broker, and that’s how you get perfect liar loans.

Home Capital had already announced on July 10 (Friday afterhours!) that in Q2, originations of high-margin uninsured mortgages had plunged 16% and originations of lower-margin insured single-family mortgages had plummeted 55% because it had axed some brokers. Its shares plunged 20% the following Monday and another 4% the next day [read… Largest “Alternative” Mortgage Lender in Canada Plunges, Denies “Systemic Problem” in Housing Market].

At the time, HCG was the fourth most shorted stock in Canada. By July 29, the day before the current announcement, HCG had risen to the second most shorted stock. Today, massive short-covering set in, and shares soared 13%, but remain 42% below where they’d been during the halcyon days last November.

“Everyone had their ideas about what transpired in the past six months; this corroborates some suspicions but dispels some others,” Shubha Khan, an analyst at National Bank Financial told the Financial Post, adding – with Canadian understatement – that there were “still some questions.”

Among them, whether these insured liar loans would continue to be insured; and whether this was an isolated problem, rather than an industry issue in the Canadian housing market. In other words, is it just the tip of the iceberg?

Housing bubbles are money generators. Temptations are huge. Falsifying mortgage applications is easy if no one checks them. It’s a mad scramble to extract as much money as possible for as long as possible – but with a devastating aftermath.

Now liar loans are coming out of the Canadian woodwork. The much touted down-payment requirements in Canada have already fallen apart. Don’t have the money for even 5% down? Solutions are openly promoted, for example:

It is not a problem anymore!!! Canada Mortgage & Financial Group (CMFG) has a new product that now allows you to borrow your down payment from any source…. The only amount you need to show on your own is 1.5% of the purchase price….

With regulators breathing softly down their necks, banks might have become more careful in lending to people to buy homes that are among the most overpriced in the world. What has that accomplished? The rise of alternative lenders in the shadow banking system. They’re not subject to the same regulations as banks.

“There’s a lot more that can be hidden from the public, things that are not right could not be noticed early on,” Michael Dolega, a senior economist at TD Economics, told theHuffington Post of Canada. “The quality is slipping, and it’s far more questionable for some of these smaller lenders, but at the same time I think it’s still better than it was in the U.S., when it went south pretty quickly.

Yes, this time it’s different.

But the patterns are crystallizing: Home Capital Group with liar loans on its books, CMFG with ultra-low down-payment loans on its books…. In banking, bad deals are made in good times.

Even the Bank of Canada, in its most recent Financial System Review in June, fretted over the risks in the shadow banking system due to its “less regulated nature” and outright “opacity,” and considered it a “particularly important vulnerability” to financial stability. While the sector is still relatively small, it would impact the overall economy, it said.

But it’s not so small anymore – estimated at 10% of Canada’s mortgage market and growing rapidly: A report by CIBC (Canadian Imperial Bank of Commerce), cited by the Huffington Post, found that lending by alternative lenders had doubled since 2012, and as of the Q3 last year, was still growing 20% year-over-year.

This comes at the worst possible time for Canada. The economy likely shrank in the first half. Hence, the Conference Board of Canada just downgraded growth to 1.6% in 2015, worst since 2009. It sees some deep problems, after a 15.5% plunge in business investment in Q1:

Oil and gas firms are expected to chop their investment by almost one-third…. Outside the energy sector, firms remain hesitant to invest. Purchases of machinery and equipment suffered a substantial decline in the first quarter of the year, and a decline in building permits suggests a downturn in commercial construction in 2015. Overall, business investment will drop by close to 7% this year.

Household spending is also expected to weaken, despite savings for consumers at the gas pump and federal tax cuts. Soft employment growth, weak wage gains, high level of household debt and job losses in oil producing provinces will combine to limit growth in consumer spending to 2.1% in 2015.

That would be the optimistic scenario. It assumes that the magnificent housing bubble can be maintained; but all bets are off if it takes liar loans, among other underwriting schemes, to maintain it. And when the housing bubble deflates, all these schemes that are forgiven as long as prices rise will turn into an unappetizing mess.

The problems are already spreading in the Canadian real estate sector. Read… Epic Glut of Office Space Crushes Hope in Canadian Oil Patch