KeNo's Housing and Economic Portal: Saturday July 24 Housing and Economic stories

Friday, July 23, 2010

Saturday July 24 Housing and Economic stories

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TOP STORIES:

Rogoff Says China Property Starting to ‘Collapse’ - (www.bloomberg.com) China’s property market is beginning a “collapse” that will hit the nation’s banking system, said Kenneth Rogoff, the Harvard University professor and former chief economist of the International Monetary Fund. As China’s economy develops, “especially at the speed it’s growing, it’s going to have bumps,” said Rogoff, speaking in an interview with Bloomberg Television in Hong Kong. He also said that while recoveries across the global economy are “very slow,” the danger of a return to recession isn’t “elevated.” Rogoff’s concern echoes that of investors, who sent China’s benchmark stock index to its worst loss in more than a year last week. China’s data have been a focus because the nation has led the global recovery from the worst postwar recession.

Supply Chain for iPhone Highlights Rising Costs in China - (www.nytimes.com) What the latest analysis shows is that the smallest part of Apple’s costs are here in Shenzhen, where assembly-line workers snap together things like microchips from Germany and Korea, American-made chips that pull in Wi-Fi or cellphone signals, a touch-screen module from Taiwan and more than 100 other components. But what it does not reveal is that manufacturing in China is about to get far more expensive. Soaring labor costs caused by worker shortages and unrest, a strengthening Chinese currency that makes exports more expensive, and inflation and rising housing costs are all threatening to sharply increase the cost of making devices like notebook computers, digital cameras and smartphones. Desperate factory owners are already shifting production away from this country’s dominant electronics manufacturing center in Shenzhen toward lower-cost regions far west of here, even deep in China’s mountainous interior.

Microsoft Calling. Anyone There? - (www.nytimes.com) Microsoft’s engineers and executives spent two years creating a new line of smartphones with playful names that sounded like creatures straight out of “The Cat in the Hat” — Kin One and Kin Two. Stylish designs, an emphasis on flashy social-networking features and an all-out marketing blitz were meant to prove that Microsoft could build the right product at the right time for the finickiest customers — gossiping youngsters with gadget skills. But last week, less than two months after the Kins arrived in stores, Microsoft said it would kill the products. “That’s a record-breaking quick end to a product, as far as I am concerned,” said Michael Cronan, a designer who helped drive the branding of products like Kindle for Amazon and TiVo. “It did seem like a big mistake on their part.”

Obama Decried, Used Bush Drilling Policies - (online.wsj.com) Less than four months after President Barack Obama took office, his new administration received a forceful warning about the dangers of offshore oil drilling. The alarm was rung by a federal appeals court in Washington, D.C., which found that the government was unprepared for a major spill at sea, relying on an "irrational" environmental analysis of the risks of offshore drilling. The April 2009 ruling stunned both the administration and the oil industry, and threatened to delay or cancel dozens of offshore projects in Alaska and the Gulf of Mexico. Despite its pro-environment pledges, the Obama administration urged the court to revisit the decision. Politically, it needed to push ahead with conventional oil production while it expanded support for renewable energy. Another reason: money. In its arguments to the court, the government said that the loss of royalties on the oil, estimated at almost $10 billion, "may have significant financial consequences for the federal government." The U.S. Court of Appeals reversed its decision and allowed drilling in the Gulf to proceed—including on BP PLC's now-infamous Macondo well, 50 miles off the Louisiana coast.

Detroit: The Do-It-Yourself City - (online.wsj.com) In tapped-out Detroit, residents pay out-of-pocket to spruce up vacant lots, parks. Although he retired long ago, Eddie Edwards has found work that keeps him busy for much of the year: staving off blight on his block. This summer, the 63-year-old Mr. Edwards is chopping down tall weeds in empty lots and cleaning the alleyways behind his home and across the street. He also routinely takes care of the street sweeping, using just a broom and dust pan. "It is time-consuming," says Mr. Edwards, who spent his professional life molding glass into windshields and tail lights for Chrysler. "But I don't have anything else to do." Across Detroit, do-it-yourselfers such as Mr. Edwards are rolling up their sleeves and opening up their wallets to provide basic services that the financially strapped city can no longer manage on its own, from boarding up vacant homes to mowing lawns to maintaining parks. In some areas, residents also partner with city agencies or look to philanthropies for help. "My cellphone is full of people" who do upkeep on their own, says Brad Dick, deputy director of Detroit's General Services Department. Many think they are going it alone, he says. "They're always shocked they're not the only one."