Tuesday, December 31, 2013

Data From The “Concentrated” Real Estate Bubble - Class-Based, Private For-Profit Capital, The Investor Class And Their Enabler, The Federal Reserve, Are Holding The Bag

What a fitting final post for 2013.  A post that is a microcosm for all of the fraud, deceit, manipulation and outright lies that define the class-based corporate state – literally everything touched by the corporate state and its violent, predatory and rent-extracting invention, corporate capitalism, is corrupt.  And, now Americans are finally getting an unvarnished look at the breadth and depth of corporate capitalism and the corporate state as we tumble down its seemingly bottomless rabbit hole of dystopia. 

I have discussed on here the countless dynamics that have led to another real estate bubble; policies that suppress the supply glut while creating new predatory sources of demand.  The policy changes that allowed banks to become rent-seeking landlords rather than deal with the toxic assets on their books, the massive swell of free money that allowed private equity, investment banks and vulture capital to buy unprecedented amounts of housing as rent-seeking landlords, the Federal Reserve buying up trillions of dollars of Wall Street’s toxic and criminal mistakes to mask their collapse, the Federal Reserve’s free money policy for financial predators that simply restarted past behavior, etc.  

It should be no surprise that the Case-Shiller Index has been rising for well over a year at a rapid and clearly unsustainable pace.  When pumped by the shills at CNBC to chime in on the faux housing recovery, Professor Shiller remarked just a few months ago that he didn’t see this as a sign of recovery but rather a result of exogenous circumstances created by the financial system.  And, he certainly is accurate.  This new real estate bubble was not driven by citizen demand for housing but by corrupt and crony policies that backstopped and bailed out predatory, rent-seeking corporate criminals and the pathocracy. 

Housing affordability is now once again unattainable for most   Americans as prices skyrocket in large metro markets manipulated by financial predators and the corporate state.  In the process of enslaving Americans into an even greater level of financial rent extraction, private for-profit capital is once again holding the bag.  And, so is the Federal Reserve now that its balance sheet has swollen into unprecedented territory.  All the Federal Reserve has done is reflate the last economic bubble but make it even larger.  By the way, this is the last bubble as noted on here many times.  We are in the relative calm of the eye of the storm.  The back end of this storm will be devastating to this system. 

Las Vegas leads the way of insanity with a just-reported, and nearly unbelievable, 27.1% year-over-year increase with San Francisco and Los Angeles not far behind.   Think about that.  The value of real estate for however long one wishes to define it, increased by more than one fourth in one year comparative to all historical value.  (To get some level of comparative, real estate in China has often been increasing at these rates month-over-month rather than year over year.  Truly frightening for what is yet to come in China.) 

This bubble has been created while substantially less people are employed as more workers have entered the workplace and the labor participation rate has not budged.   This bubble has been created while the vast majority of jobs created since the 2008 crash are nonliving wage, doing-each-other’s-laundry service economy jobs.  This bubble has been created while poverty rises daily to record levels in our nation.  This bubble has been created while no new wealth has actually been created in the vacuum of Wall Street, Washington and Federal Reserve corruption and ignorance.   This bubble has created asset values that are clearly nothing more than a figment of the imagination.

When I get the chance to put up my follow-on posts on the mythical service economy, I’ll share some data points that literally no one else is talking about.  Because literally no one else understands.  I do mean literally no one.   At least no one alive who has a voice in this system.  It will help readers gain an appreciation of how massive this bubble is, and as it relates to this post, why housing, corporate real estate and farmland prices could literally collapse to levels of 20-35 years ago.  Or why money, as an institution of the ego (control), could literally become meaningless.  

The latest city-by-city look at astronomical house price increases and the new Federal Reserve/corporate state induced real estate bubble.

posted by TimingLogic at 4:46 PM