Bond Bubble Dismissed as Low Yields Echo Pimco’s New Normal - (www.bloomberg.com) Mohamed El-Erian knows why bond markets from the U.S. to Germany to Brazil, where yields have dropped to record lows even though debt has ballooned to more than $40 trillion worldwide, aren’t a bubble waiting to burst. “We may be in a synchronized slowdown” in global economic growth, El-Erian, who as chief executive officer of Pacific Investment Management Co. oversees $1.77 trillion, said in a June 6 telephone interview. “We could stay here for a while.” The average yield on bonds issued by the Group of Seven nations has fallen to 1.120 percent from 3 percent in 2007, Bank of America Merrill Lynch index data show. Germany’s two-year note yield fell below zero for the first time on June 1, while Switzerland’s has been negative since April 24, meaning investors are paying for the right to lend the nation money.
23% of Small Business Owners (Approximately 6.21 million) Report No Pay for Yr - (globaleconomicanalysis.blogspot.com) Citing a new survey by Citigroup, CNBC Reports All Work, No Pay for Some Small Business Owners.
Here are some interesting highlights.
Here are some interesting highlights.
· Over the past few years, business owners report that they have, at one time or another, taken less profit (78 percent), worked more hours than usual (70 percent), and used their own money to help the business survive (69 percent).
· 54 percent of respondents say they have gone without a paycheck in order to keep the business running.
· 23 percent of owners have gone without pay for one year or more.
· More than one-third of owners (38 percent) said their employees worked overtime without pay
· 18 percent of owners said employees either missed paychecks or had paychecks delayed.
· Access to financing doesn’t come up in the top five most important issues among small businesses. Instead, business owners cite lack of sales and consumer confidence.
Games Realtors Play - (www.patrick.net) Realtors play many games, depending on the area you live in. The real estate "profession" is supposedly self regulating, but this also depends on where you live. I once dealt with a local Realtor who was on the local ethics board--she managed some houses for me, and was often months late with her payments to me, rent she had collected months before. I also sold her some houses, and she actually never paid the property taxes--when I found out, I paid the taxes, and promptly sold the mortgages to Associates Finance, who doesn't put up with things like that (I was carrying the mortgage paper). Other games: if you are a seller, you should to some extent assume that your realtor is working against you. Typically the realtor will suck up to the buyer behind your back. If you are a buyer, typically the realtor will "omit" things that may reflect badly on the house, especially to first time buyers, who are often clueless. I once sold a house that had been flooded (years before I owned it, but I did know about it). I wrote out a statement for the buyer to sign, and asked the realtor to get the buyer to sign, acknowledging that I had disclosed the prior flooding. The realtor refused to cooperate until I threatened call the real estate commission. And he was president of the state association of realtors at the time! If you must use a realtor, cover your ass at all times, never let your guard down, double check everything, and do not assume, for one second, that the realtor actually knows the law.
We Have Too Many Empty Houses - (www.bloomberg.com) Video - Warren Buffett tells MSNBC's 'Morning Joe' that while signs of domestic economic recovery are underway, a recovery in the housing market will be key to robust growth. Video courtesy MSNBC. (Source: Bloomberg)
Fannie and Freddie Mistakes - (www.realtor.org) Fannie Mae and Freddie Mac: the mere mention of them arouses passionate anger in many people. Rightly so. These two entities, which had taxpayer guarantees, ran their businesses as if they were privately owned. Fannie and Freddie made huge bets on the housing market. If it had been their money and their loss, then there would be no problem. But their mistakes took taxpayers down as well. What went wrong and what needs to happen? Fannie Mae was born from the Great Depression in the 1930s to help bring mortgages to the ailing housing market of the time. Fannie was a government corporation (not a private corporation) with the single mission of increasing liquidity by buying up soundly underwritten mortgages. Because of Fannie and its government status, 30-year fixed rate mortgages became widely available. Canada and Britain, for example, do not have long-term mortgages, or least not at low cost, because they do not have a Fannie equivalent with government guarantees.