Offshore Inn for International Real Estate, Overseas Jobs, Asset Protection, Expatriate Resources and Overseas Retirement
It is a peculiar irony. A year ago, the the UK’s Inland Revenue began a crackdown on offshore savings. Banks operating out of the Channel Islands and the Isle of Man had to hand over details of British customers, and depositors who confessed were rewarded with an amnesty. Thousands did and many must have given up on offshore savings. Inadvertently, the taxman’s crackdown must have saved some depositors from the collapse of the offshore subsidaries of Icelandic banks.
Thousands were not so lucky and could now lose most of their savings …
Consider if you will be a sole proprietorship, partnership or corporation.
‘You’re so lucky, being able to work abroad.’ I’ve forgotten how many times I’ve heard that statement.
If you have assets, you are most likely a target. When your assets are visible, you are the bullseye.
Do you need a job? Just got a question? Pop it in here and you’ll get an answer from our Inn Team.
Tip the scales in your favour, protect your home and family with asset protection programmes for partnerships, corporations and individuals.
Joe Weisenthal writing for Business Insider reports Consumer Credit Demolishes Expectations, Grows $19 Billion.
It’s hard to think that the economy is going into any kind of recession with numbers like these. For the second straight month we just got a HUGE number on consumer credit
Consumer credit expanded by $19 billion in December. That’s far more than the $7 billion that was expected by economists.
This chart from Reuters’ Soctty Barber basically tells it all.
The data on which that chart was produced was the Consumer Credit - G.19 government report.
Demolishing the Revolving Credit Side of the Story
Lance Roberts of Streettalk Live demolishes the revolving credit side of Weisenthal ’s story (a $4 billion December rise) in an excellent perspective Consumer Credit and the American Conundrum.
Demolishing the Non-Revolving Credit Side of the Story
My job is to demolish the non-revolving side of Weisenthal’s story, and it’s an exceptionally easy task to do.
Non-Revolving credit rose $11.8 billion in December. However, $8.8 billion of that is growth in federal government loans (which just happens to be where student loans are parked).
Here are some charts I put together stripping out federal government loans.
Non-Revolving Loans Minus Government Loans
Non-Revolving Loans Minus Government Loans Detail
True Bounce in Percentage Terms
Note that the year-over-year “bounce” has not even gotten back to the zero-line in spite of exceptionally easy comparisons.
Middle-Aged Borrowers Pile on Student Debt
Reuters reports Middle-Aged Borrowers Pile on Student Debt
Educational borrowing is up for every age group over the past three years, but it has grown far more quickly among those between 35 and 49, according to the analysis of more than 3 million credit reports provided to Reuters by the credit score tracking site CreditKarma (CreditKarma.com). That group saw its school debt burden increase by a staggering 47 percent, according to the analysis.
The average student loan debt for those aged 38 to 41 was the biggest of that group — about $12,000, up from just under $9,000 in 2009. Young people still carry the biggest student loan burdens; those aged 26 to 29 have an average of $14,000 in student debt. But the increased levels in middle-aged student debt is a new phenomenon.
Negative Payback on Retraining
The benefit of going back to school at age 49 is likely negative.
My friend “BC” comments:
The payoff for 40- and 50-somethings taking on debt to change occupations or trying to find jobs in “health care” or “education” and compete with Millennials trying to secure similar positions is low or negative.
Statistically, the benefit to “education” occurs between ages 14 and 22, where one goes to high school and university. Obtaining an MBA, law degree, or another graduate degree after age 26-28 historically has not resulted in a net benefit in terms of job/career prospects or wage/salary income; and this has become particularly the case since the late ’90s.
In other words, the vast majority of people running up debt at universities, community colleges, and for-profit technical schools are wasting their time and money, as well as directing scarce resources to the “health care” and “education” sectors that don’t need more misallocation further driving up costs.
Needless to say, there is no precedent in US history for middle-aged unemployed, underemployed, or unemployable Americans running up debt in an economy that has not created a net new private sector full-time job per capita in at least 10 years.
Fewer Nonfarm Employees Now Than December 2000
Here is one key chart (of many) from Fewer Nonfarm Employees Now Than December 2000; Unemployment Rate: Some Things Still Don’t Add Up; Obamanomics?
Total Nonfarm Employees
There are currently 132,409,000 nonfarm employees. In December of 2000 there were 132,481,000 employees. How’s that for job growth?
Retraining Scam
Job retraining is scam perpetrated by for-profit universities, fueled by statements from Obama regarding re-training people for new jobs.
Brick-layers are told they can be “chefs”, take $10,000 courses and the universities call it a “success” if they land a job “in their field” at McDonald’s. Unemployed roofers are led to believe they can become Java programmers, and they waste collective $billions trying. Meanwhile out of work Java programmers are told to take up a trade like roofing or auto mechanics.
The cost of education keeps rising because Obama (like Bush before him), keeps adding to the student loan program when the entire student loan scam really needs to be shut down.
Why Does the Scam Roll On and On?
One can always find success stories, but in aggregate, retraining middle-aged workers is a net waste of money.
To Paraphrase Joe Weisenthal
Now, to paraphrase Joe Weisenthal: “It’s hard to think that the economy is NOT going back into a recession with numbers like these.” The difference in viewpoint is understanding what the underlying numbers really represent.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Not many people realize this but in spite of polling anywhere between 16% and 22% in recent election polls, Marine Le Pen might not be included on the French presidential ballot. The reason is Le Pen needs 500 signatures by elected official supporting her campaign. Le Pen says she only has 350.
I had been aware of this for some time but figured she could scrape up 500 signatures from a pool of 47,000 or so bureaucrats eligible to sign. Perhaps not.
Please consider Le Pen attacks all sides over ‘pathetic’ poll
Far-right Front National leader Marine Le Pen slammed a poll in a Sunday newspaper that asked people how they would vote if she was not on the ballot paper.
The prospect could be a reality if Le Pen fails to get 500 elected officials to sponsor her candidacy.
Under French law, any presidential candidate needs 500 signatures from elected representatives in at least 30 different departments across the country or in France’s overseas territories.
Le Pen told RTL radio on Thursday that she was still 150 short of the target number and risked being excluded from the vote on April 22nd.
A Sunday newspaper, Journal du Dimanche, published an opinion poll at the weekend showing that the fortunes of current president Nicolas Sarkozy improve markedly without Le Pen in the picture.
In that case, Sarkozy and his Socialist rival François Hollande would each get 33 percent of the vote.
Current polls give the president around 24 percent compared to Hollande’s 30 percent. Le Pen is just behind on around 20 percent, threatening to overtake the president and secure a place in the final two-way runoff on May 6th.
Le Pen told a meeting in Toulouse on Sunday that the scenario in the poll was “the dream of the political class.”
“If I’m not there will you vote for Nicolas Sarkozy, for François Hollande?” she said, as the audience booed and whistled.
“There is your response to their pathetic opinion polls and pathetic manipulations,” she said.
Does it Matter?
The answer is not straight forward. It depends on the meaning of “matter”.
Le Pen was not going to win. If she is off the ballot, More first-round votes will go to Nicolas Sarkozy than François Hollande.
However, in the second round of voting (recall French elections are two-stage with the top two candidates competing in a runoff), Polls show Hollande beating Sarkozy by 58% to 42% margin. Even if she bumped off Sarkozy, she would not win. Nor will Sarkozy win.
Thus from a candidate point of view, one might say it does not matter.
However, the process is certainly a defeat of democracy. Nothing is served by a process of keeping her off the ballot. Indeed, if she is as bad as Sarkozy claims, then voters should recognize that as well.
The 36,000 mayors and 11,000 other bureaucrats eligible to vote have to do so publicly. Le Pen has a challenge into the French Supreme Court on the secret ballot issue. That case will be heard on February 22 as noted by Reuters in French far right say big parties muzzling democracy.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Not many people realize this but in spite of polling anywhere between 16% and 22% in recent election polls, Marine Le Pen might not be included on the French presidential ballot. The reason is Le Pen needs 500 signatures by elected official supporting her campaign. Le Pen says she only has 350.
I had been aware of this for some time but figured she could scrape up 500 signatures from a pool of 47,000 or so bureaucrats eligible to sign. Perhaps not.
Please consider Le Pen attacks all sides over ‘pathetic’ poll
Far-right Front National leader Marine Le Pen slammed a poll in a Sunday newspaper that asked people how they would vote if she was not on the ballot paper.
The prospect could be a reality if Le Pen fails to get 500 elected officials to sponsor her candidacy.
Under French law, any presidential candidate needs 500 signatures from elected representatives in at least 30 different departments across the country or in France’s overseas territories.
Le Pen told RTL radio on Thursday that she was still 150 short of the target number and risked being excluded from the vote on April 22nd.
A Sunday newspaper, Journal du Dimanche, published an opinion poll at the weekend showing that the fortunes of current president Nicolas Sarkozy improve markedly without Le Pen in the picture.
In that case, Sarkozy and his Socialist rival François Hollande would each get 33 percent of the vote.
Current polls give the president around 24 percent compared to Hollande’s 30 percent. Le Pen is just behind on around 20 percent, threatening to overtake the president and secure a place in the final two-way runoff on May 6th.
Le Pen told a meeting in Toulouse on Sunday that the scenario in the poll was “the dream of the political class.”
“If I’m not there will you vote for Nicolas Sarkozy, for François Hollande?” she said, as the audience booed and whistled.
“There is your response to their pathetic opinion polls and pathetic manipulations,” she said.
Does it Matter?
The answer is not straight forward. It depends on the meaning of “matter”.
Le Pen was not going to win. If she is off the ballot, More first-round votes will go to Nicolas Sarkozy than François Hollande.
However, in the second round of voting (recall French elections are two-stage with the top two candidates competing in a runoff), Polls show Hollande beating Sarkozy by 58% to 42% margin. Even if she bumped off Sarkozy, she would not win. Nor will Sarkozy win.
Thus from a candidate point of view, one might say it does not matter.
However, the process is certainly a defeat of democracy. Nothing is served by a process of keeping her off the ballot. Indeed, if she is as bad as Sarkozy claims, then voters should recognize that as well.
The 36,000 mayors and 11,000 other bureaucrats eligible to vote have to do so publicly. Le Pen has a challenge into the French Supreme Court on the secret ballot issue. That case will be heard on February 22 as noted by Reuters in French far right say big parties muzzling democracy.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Not many people realize this but in spite of polling anywhere between 16% and 22% in recent election polls, Marine Le Pen might not be included on the French presidential ballot. The reason is Le Pen needs 500 signatures by elected officials supporting her campaign. Le Pen says she only has 350.
I had been aware of this for some time but figured she could scrape up 500 signatures from a pool of 47,000 or so bureaucrats eligible to sign. Perhaps not.
Please consider Le Pen attacks all sides over ‘pathetic’ poll
Far-right Front National leader Marine Le Pen slammed a poll in a Sunday newspaper that asked people how they would vote if she was not on the ballot paper.
The prospect could be a reality if Le Pen fails to get 500 elected officials to sponsor her candidacy.
Under French law, any presidential candidate needs 500 signatures from elected representatives in at least 30 different departments across the country or in France’s overseas territories.
Le Pen told RTL radio on Thursday that she was still 150 short of the target number and risked being excluded from the vote on April 22nd.
A Sunday newspaper, Journal du Dimanche, published an opinion poll at the weekend showing that the fortunes of current president Nicolas Sarkozy improve markedly without Le Pen in the picture.
In that case, Sarkozy and his Socialist rival François Hollande would each get 33 percent of the vote.
Current polls give the president around 24 percent compared to Hollande’s 30 percent. Le Pen is just behind on around 20 percent, threatening to overtake the president and secure a place in the final two-way runoff on May 6th.
Le Pen told a meeting in Toulouse on Sunday that the scenario in the poll was “the dream of the political class.”
“If I’m not there will you vote for Nicolas Sarkozy, for François Hollande?” she said, as the audience booed and whistled.
“There is your response to their pathetic opinion polls and pathetic manipulations,” she said.
Does it Matter?
The answer is not straight forward. It depends on the meaning of “matter”.
Le Pen was not going to win. If she is off the ballot, More first-round votes will go to Nicolas Sarkozy than François Hollande.
However, in the second round of voting (recall French elections are two-stage with the top two candidates competing in a runoff), Polls show Hollande beating Sarkozy by 58% to 42% margin. Even if she bumped off Sarkozy, she would not win. Nor will Sarkozy win.
Thus from a candidate point of view, one might say it does not matter.
However, the process is certainly a defeat of democracy. Nothing is served by a process of keeping her off the ballot. Indeed, if she is as bad as Sarkozy claims, then voters should recognize that as well.
The 36,000 mayors and 11,000 other bureaucrats eligible to vote have to do so publicly. Le Pen has a challenge into the French Supreme Court on the secret ballot issue. That case will be heard on February 22 as noted by Reuters in French far right say big parties muzzling democracy.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Businesses and pensioners are at loggerheads over the merits of further monetary stimulus by the Bank of England. The British Chambers of Commerce (BCC) said yesterday that another £50bn of quantitative easing by the Bank’s Monetary Policy Committee today is necessary to support the ailing UK economy. David Kern, the chief economist of the BCC, said: “Though many of the benefits of QE feel intangible on the ground, it remains a critical bulwark for the UK financial system and the wider economy.”
This roundtable meeting was part of the project, Entrepreneurs and Market Linkages in Conflict and Post-Conflict Environments, organized by the Civil Society, Markets, and Democracy Initiative.
Peter Orszag wants the United States to rely more on automatic stabilizers to stem the shocks from recessions.
Michael Hodin says the path to fiscal sustainability lies in funding research programs and healthy aging initiatives that reduce the government outlays needed to care for an aging population.
I nearly always disagree with Bernanke on monetary and fiscal policy. Specifically, the Fed ought not have a monetary policy for the simple reason the Fed should not exist.
Indeed, the Bernanke Fed and the Greenspan Fed have both proven beyond a shadow of a doubt they do not know what they are doing, where the economy is headed, or anything else of relevance in setting monetary policy.
However, on rare occasions, Bernanke can say a few snippets that seem to make complete sense. For example, Bernanke Says 8.3% Unemployment Understates Labor Weakness.
Federal Reserve Chairman Ben S. Bernanke said the 8.3 percent rate of unemployment in January understates weakness in the U.S. labor market.
“It is very important to look not just at the unemployment rate, which reflects only people who are actively seeking work,” Bernanke said today in response to questions at a hearing before the Senate Budget Committee in Washington. “There are also a lot of people who are either out of the labor force because they don’t think they can find work” or in part- time jobs.
“The 8.3 percent no doubt understates the weakness of the labor market in some broad sense,” Bernanke said today, while noting that some job indicators are improving.
Fed officials last month estimated that the world’s largest economy will grow 2.2 percent to 2.7 percent this year, according to the central tendency estimate, while the unemployment rate will average 8.2 percent to 8.5 percent in the fourth quarter.
Disagreements Already
I agree with most of the above analysis, but the more Bernanke or the Fed talks, the quicker a disagreement is bound to arise. The problem above is the Fed’s growth projection. The Fed could be right, I just highly doubt it.
Let’s put it this way, Bernanke has been seriously wrong so many times on economic projections that perhaps by accident he finally gets one correct.
“8.3% Unemployment Understates Labor Weakness”
Some things are so obvious even Bernanke seems to understand. His labor weakness statement is one of them.
I said similar things on Monday, with far more details and reasons, in Fewer Nonfarm Employees Now Than December 2000; Unemployment Rate: Some Things Still Don’t Add Up; Obamanomics?
Please click on link for a series of charts showing just how weak the recovery has been and just how understated the unemployment rate is.
Critique of Bernanke’s Pledge to Hold Rates to Zero Through 2014
The strange thing here is that although Bernanke seems to understand the likeliness of further economic weakness, most analysts and writers are tooting the horns of an economic recovery, while chastising Bernanke for promising to hold rates low until 2014, as if the decline in unemployment rate is meaningful.
I disagree with the Fed’s rate decision for a different fundamental reason: a bunch of academics chasing their tails cannot effectively set interest rates (only the market can). That simple fact has been proven is spades.
Analysis of Bernanke’s “Labor Weakness” Statements
Unfortunately, Bernanke’s statements offer surprising little economic insight.
For example, please consider the Fed’s estimate that the “unemployment rate will average 8.2 percent to 8.5 percent in the fourth quarter“.
Perfectly Useless Projection
Let’s assume Bernanke is correct. Is that a meaningful projection?
The short answer is the projection, even if totally accurate, is perfectly useless. Let’s analyze “why? in light of Bernanke’s estimate that it takes 125,000 jobs a month to keep up with demographics (birthrate plus immigration).
Three Cases In Which Unemployment Rate Stays Flat
It would be more useful (assuming there is any use to Bernanke’s statements which is certainly debatable) to know just what he is thinking because those three scenarios are vastly different in terms of economic significance, even though they all project the same 8.2 percent to 8.5 percent unemployment rate prediction.
In other words, the Fed’s projection, even if accurate, is totally useless, not that anyone should be paying any attention to what he says in the first place.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
I nearly always disagree with Bernanke on monetary and fiscal policy. Specifically, the Fed ought not have a monetary policy for the simple reason the Fed should not exist.
Indeed, the Bernanke Fed and the Greenspan Fed have both proven beyond a shadow of a doubt they do not know what they are doing, where the economy is headed, or anything else of relevance in setting monetary policy.
However, on rare occasions, Bernanke can say a few snippets that seem to make complete sense. For example, Bernanke Says 8.3% Unemployment Understates Labor Weakness.
Federal Reserve Chairman Ben S. Bernanke said the 8.3 percent rate of unemployment in January understates weakness in the U.S. labor market.
“It is very important to look not just at the unemployment rate, which reflects only people who are actively seeking work,” Bernanke said today in response to questions at a hearing before the Senate Budget Committee in Washington. “There are also a lot of people who are either out of the labor force because they don’t think they can find work” or in part- time jobs.
“The 8.3 percent no doubt understates the weakness of the labor market in some broad sense,” Bernanke said today, while noting that some job indicators are improving.
Fed officials last month estimated that the world’s largest economy will grow 2.2 percent to 2.7 percent this year, according to the central tendency estimate, while the unemployment rate will average 8.2 percent to 8.5 percent in the fourth quarter.
Disagreements Already
I agree with most of the above analysis, but the more Bernanke or the Fed talks, the quicker a disagreement is bound to arise. The problem above is the Fed’s growth projection. The Fed could be right, I just highly doubt it.
Let’s put it this way, Bernanke has been seriously wrong so many times on economic projections that perhaps by accident he finally gets one correct.
“8.3% Unemployment Understates Labor Weakness”
Some things are so obvious even Bernanke seems to understand. His labor weakness statement is one of them.
I said similar things on Monday, with far more details and reasons, in Fewer Nonfarm Employees Now Than December 2000; Unemployment Rate: Some Things Still Don’t Add Up; Obamanomics?
Please click on link for a series of charts showing just how weak the recovery has been and just how understated the unemployment rate is.
Critique of Bernanke’s Pledge to Hold Rates to Zero Through 2014
The strange thing here is that although Bernanke seems to understand the likeliness of further economic weakness, most analysts and writers are tooting the horns of an economic recovery, while chastising Bernanke for promising to hold rates low until 2014, as if the decline in unemployment rate is meaningful.
I disagree with the Fed’s rate decision for a different fundamental reason: a bunch of academics chasing their tails cannot effectively set interest rates (only the market can). That simple fact has been proven is spades.
Analysis of Bernanke’s “Labor Weakness” Statements
Unfortunately, Bernanke’s statements offer surprising little economic insight.
For example, please consider the Fed’s estimate that the “unemployment rate will average 8.2 percent to 8.5 percent in the fourth quarter“.
Perfectly Useless Projection
Let’s assume Bernanke is correct. Is that a meaningful projection?
The short answer is the projection, even if totally accurate, is perfectly useless. Let’s analyze “why? in light of Bernanke’s estimate that it takes 125,000 jobs a month to keep up with demographics (birthrate plus immigration).
Three Cases In Which Unemployment Rate Stays Flat
It would be more useful (assuming there is any use to Bernanke’s statements which is certainly debatable) to know just what he is thinking because those three scenarios are vastly different in terms of economic significance, even though they all project the same 8.2 percent to 8.5 percent unemployment rate prediction.
In other words, the Fed’s projection, even if accurate, is totally useless, not that anyone should be paying any attention to what he says in the first place.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
The White House released this fact sheet on ‘harnessing innovation for global development’ (part of President Obama’s Global Development Policy) on February 8, 2012.
China has increased its economic ties with Africa as it seeks to fulfill its growing energy demands. But China’s way of doing business has prompted international criticism, even as its policy of noninterference faces new challenges.
The Hamas-Fatah unity deal reflects Palestinian efforts to find new patrons and new sources of support in the region, says CFR’s Robert M. Danin.
Ray Takeyh states, “Despite all the exhilarating and disturbing changes in Egypt and the Levant, the center of gravity of the region has moved to the Gulf.”
Inquiring minds are tired of the spotlight on Greece (believe me I am as sick as anyone of Groundhog Day).
Given the world will not end when Greece defaults, whether in March of this year or next, let’s turn our attention to a country far more significant.
Chinese Electricity Consumption Fell Massively In January
Business Insider reports Chinese Electricity Consumption Fell Massively In January, And The Chinese New Year Doesn’t Explain It
Ultra-brief note here from Nomura’s Zhiwei Zhang :
According to the China Securities Journal, China’s electricity consumption in January fell by 7.5%. We estimate this may be the first decline since 2002 (excluding the financial crisis period in 2008-09), indicating industrial production may have slowed sharply in January.
They don’t have any more answers here at the moment, except they say that if you’re thinking it has something to do with the New Year, then you are incorrect.
For now it’s just one of those things that make you go hmm…
China Pressures Iran On Oil Prices
China has stepped up the pressure on Iran in the face of Europe’s oil embargo. Business World reports China’s Oil Imports From Iran Reduced Again
China will reduce its crude oil imports from Iran for a third month, sources said today, as the two remain divided over payment and price terms, although they plan to meet again for talks as early as this week.
China is the top buyer of Iranian oil and also the fastest expanding major oil importer, putting it in a strong position to negotiate for better terms after it more than halved imports for both January and February.
The reductions for March-loading supplies will be largely the same, if not deeper, than the previous two months, industry officials with direct knowledge of the supply situation told Reuters.
China, which buys around 20 percent of Iran’s total crude exports, cut its January and February purchases by about 285,000 bpd, just over one half of the total average daily amount it imported in 2011.
China Central Bank Vows Housing Support
In a sure sign that property prices in China are crashing faster than the Chinese government wants, China Central Bank Vows Housing Support
China’s central bank pledged support for first-home buyers as a crackdown on real-estate speculation threatens to trigger a property slump in the world’s second- biggest economy.
Officials will increase support for construction of affordable housing and ensure that “loan demand from first-home families” is met, the People’s Bank of China said on its website yesterday evening.
Policy makers aim to limit public discontent by making housing more affordable, with Vice Premier Li Keqiang, a possible contender to be the next premier, describing the distribution of low-cost homes as a key test of government credibility. At the same time, the ruling Communist Party aims to avoid the economic “hard landing” that Fitch Ratings said yesterday is a key global risk.
“The government doesn’t want to see home transactions slide too fast — that may hurt economic growth,” said Lu Ting, a Hong Kong-based economist at Bank of America Corp.
Too Late to Prevent a Hard Landing
Given the massive size of China’s property bubble, it’s far too late to prevent a crash landing. The only way to prevent crashes is to not let bubbles get so big in the first place.
Asia Real-Estate Bull Turns Bearish
MarketWatch reports Asia Real-Estate Bull Turns Bearish
Asia’s gradually cooling property markets aren’t the great buys they once were, according to one expert in the region, who says better bargains can be found in the depressed markets in the West.
Tim Murphy, the Hong Kong-based chief executive officer of property advisory group IP Global, says he’s telling his clients to look more towards New York and San Francisco for deals, although London also ranks well in terms of rental yield in some projects.
Back home in Asia, the only market he likes is Malaysia, where average prices in its big cities are about one-tenth of those in Hong Kong, while its commodity-backed economy should outperform its export-dependent regional rivals.
What’s changed? Murphy says the ongoing debate in Asia during the current soft patch is being driven by inflation concerns that were absent during previous periods of economic weakness.
Specifically, he sees a “role reversal” from the regional crisis that unfolded in 1997, as fresh barriers to foreign investment and speculative activity are now enacted across many parts of Asia, while hard-hit cities in the West are offering tax breaks and other concessions as incentives to invest.
Today, governments around the region, and particularly in China, are wary that too much liquidity could stoke a U.S.-style housing bubble and inflict long-term damage upon the economy, he said.
“Singapore and Hong Kong are two of the freest economies in the world, yet you pay more in stamp duties [real-estate transaction taxes] now than you would in London, because they are very worried about the markets continuing to overheat,” Murphy said.
Infomercial for Property-Advisory Firm IP Global
As much as I agree with the headline message, I have to comment the same message could have and should have been said years ago. Given the illiquid nature of real estate, one cannot sell on a dime when the market turns.
“We see what’s happening as a great chance for Asians to buy overseas at the moment,” Murphy said, adding that in December he opened an office in Shanghai to tap the growing interest among China’s newly wealthy for overseas homes.
Given the entire two-page article was about Murphy and his firm, I have to ask “Was that an news story by MarketWatch or an infomercial for Tim Murphy?”
Regardless, anyone who bought in China in the last couple years and has not sold yet is now likely trapped.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Greece bailout talks that were postponed on Friday to Saturday, then Saturday to Sunday, then Sunday to Monday, then Monday to Tuesday. They have been postponed again, this time for a reason that makes perfect sense “Political Suicide”.
The New Work Times reports Greece Puts Off Decision on Austerity Measures Amid a Strike Protesting Them
As thousands of Greeks walked off the job in a general strike on Tuesday to protest stringent new austerity measures, there was a growing sense that the country was reaching a critical point in its efforts to survive the debt crisis.
Greek political leaders postponed for yet another day a decision on an austerity package — including 20-percent cuts to base pay for workers in private companies and a loosening of public sector job protections — in exchange for the billions in loans Athens needs to prevent a default in March. With elections looming as soon as April, the parties fear that they are essentially being told to commit political suicide to save the country.
If that indeed is the case, analysts here say, it is not clear what will replace them, making Greece a potential laboratory for a volatile mix of austerity, populism and social unrest.
Not that the old order, widely derided as corrupt and inefficient, is likely to be deeply mourned.
For most Greek voters, the two larger parties participating in the fragile tripartite coalition of Prime Minister Lucas Papademos — the Socialist Party and the center-right New Democracy — were already drained of political capital before the debt crisis by decades of self-interest and corruption. That has now been capped by two years of unrelenting austerity that has hurt most Greeks but has ultimately failed to revive the system, or even change it in any significant way.
With unemployment at 19 percent, businesses closing, credit scarce and the proposed new wage cuts expected to further decimate the shrinking middle class, the hard left and extreme right are rising.
With Greek popular anger at the country’s foreign lenders rising — a German flag was burned in front of Parliament at a demonstration on Tuesday — the Socialists and New Democracy are treading a fine line: They want to push back against the troika enough to regain some political capital — and keep more Greeks from falling into poverty — but not push hard enough to precipitate a default.
If the Greek political leaders do not agree to accept the new austerity measures in the coming days, Greece will run out of time to complete a broader deal for the voluntary write-down of Greek debt before a bond comes due on March 20. If Greece cannot pay the bond, it will default, which could result in its leaving the euro zone, among other ill effects.
Most Greeks say they have lost what little faith they had in the political system. “None of the parties we’ve been voting for have anything to offer,” said Vassiliki Karanasou, 42, an employee in a biscuit factory north of Athens who was participating in a demonstration outside Parliament on Tuesday.
Eventually, Will Come a Time
I keep repeating Eventually, Will Come a Time When
Eventually, there will come a time when a populist office-seeker will stand before the voters, hold up a copy of the EU treaty and (correctly) declare all the “bail out” debt foisted on their country to be null and void. That person will be elected.
Flag-Burning Trigger
For Greece, “eventually” may be at hand. The only thing missing is a party leader willing to stand up and tell Germany to go to hell.
That is not a comment on the desirability of telling Germany to go to hell, rather a comment that is likely to happen. However, the austerity measures imposed by Germany and the Troika cannot possibly work, even though the worker reforms are badly needed.
What is causing the revolt? The sad irony of this mess is the flag-burning and latest strike is over the one thing that is needed: work rule reform.
The flag-burning incident could easily be a trigger.
All sides handled this very poorly straight from the get-go. Greece would have been better off defaulting 2 years ago and the EMU and ECB much better off to simply let it happen. Now Greece is totally and completely trashed, having agreed to austerity measures that cannot work and resisting work rule changes that can work, but only years down the road.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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BP brought cheer to Britain’s pension funds yesterday as the oil giant hiked its quarterly dividend by 14 per cent.
Residential property in Dubai will perform better than commercial assets, such as offices, over the course of 2012.
This is one of the predictions featured in an overview of the emirate’s real estate market published by the Dubai Chronicle, which noted there was an increase in the number of transactions in the residential sector in the final quarter of 2011, compared to the previous three-month period.
While rents for offices in prime locations remained broadly stable during this timeframe, the secondary market struggled with oversupply and weakening demand, the publication stated.
According to the news provider, Dubai’s residential real estate industry is in a better position because "stronger demand fundamentals are sustained by solid population growth".
Last month, Jones Lang LaSalle highlighted villa developments as more favourable investments than flats, noting the former are "generally expected to outperform apartments this year".
The firm was optimistic there will be an increase in the number of transactions completed in the United Arab Emirate’s real estate market during 2012, with private investors and high net worth individuals expected to account for a larger proportion of purchases.
UK buyers who want to purchase a property in Spain may decide now is the time to do so after one currency exchange organisation pointed out the favourable rate between sterling and the euro.
According to managing director of Currency Index Robin Haynes, those who are keen to invest in real estate in the south European nation could benefit from the strength of the British pound.
"Overseas property buyers should rest assured that the single currency devaluation will mean that they will currently be able to get over eight per cent more for their money than if they were buying euros in July last year," he stated.
The firm noted the highest proportion of its currency transactions were sent to Spain in 2011, indicating the nation has not lost its appeal among tourists and expats.
Bob Atkinson, travel expert at Travelsupermarket, recently highlighted Spain’s popularity as a holiday destination, which may bode well for anyone investing in a rental property in the country.
He noted it is "cheap" and "accessible" for Brits and, in the current climate, Spain offers good value for money, especially for families.
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