Stolen, not stirred....

The real-estate bubble is something that has been of great concern of mine lately. My father and I have had several discussions about how it can't last and how long I should wait before I consider buying a house. Currently in downtown Baltimore...Canton to be more specific...two bedroom townhouses are selling for anywhere from $350,000 to $550,000. Here is an example.

Last summer and well into the late winter months, houses were selling just days after they were put up for sale. But now, such is not the case. Several houses have been up for sale for 2-3 months now. The open houses aren't drawing many people (not that I can see anyway) and the "take-one's" in front of the houses aren't being taken.

So what gives? Is the bubble about to burst? In my humble opinion...yes. The market simply cannot sustain these prices. No recently married couple can afford a two bedroom townhouse with one-and-a-half baths for a HALF-A-MILLION DOLLARS!!! Especially with average household incomes falling! Even if they could, what kind of stupid morons would they be? (Did I mention that because of the proximity to the Inner Harbor and over 100 bars/restaurants in a one square mile radius, that the area is infested with RATS?)

Anywho, enough of my rant. I stole the next portion of this entry from Jane Hamsher over at firedoglake. (You can buy her book here.) I disagree with SOME of her views of the cast on CNBC, but a very good blog entry on one man's (Julian Robertson) view of the economy, including the real estate market. It also ties in well with my previous Nixon post:


I know I'm probably boring the crap out of everyone with my Chicken Little Economy Series, but there actually is method to my madness. Just bear with me.

I always keep one eye on the business news, because despite the fact that the gang at CNBC are a pack of inveterate liars who slavishly shill for their corporate masters, money has a preference for following craven truth no matter how base or amoral. So every once in a while somebody will pop up with a clear-eyed estimation of things with a greater frequency than you are likely to find, say, on the NBC evening news.

And the other day in between fluffing CEOs, human ashtray Ron Insana (who will always go down in my memory as he appeared on the Today Show set on 9/11, with a big pile of soot on his head...who thought that was a good idea...) interviewed a famous fund manager named Julian Robertson, who has worked on Wall Street for 53 years and manages the Robertson group of funds. As Al Martin recounts it:

They used to call him, still do call him 'Never Been Wrong' Robertson. He has predicted every economic cycle, every debacle, every bull market, and every bear market.

Of course, he's a very old man now. But his reputation on the Street is like nothing you could imagine. When the segment of his interview was through, his comments alone took the Dow Jones down 50 points. Just on his comments alone. That's how powerful this man's reputation is.

Robertson was actually a teary-eyed, an old man. When Ron Insana asked him about his predictions, he said that he's worried about the speculative bubble in housing and the fact that more than 1/4 of all consumer spending is now sustained by that bubble, plus the fact that 20 million citizens could lose their homes in a collapse of the speculative bubble in housing, and that the Fed and, indeed, central banks worldwide would act in concert out of desperation to reinflate the global economy in the process, creating an inflationary spiral unheralded in the economic history of the planet.

Insana then asks, "Where does it end?" And he said, "Utter global collapse." Not simply economic collapse; complete disintegration of all infrastructure and of all public structures of governments. Utter, utter collapse. That the end is collapse of simply epic proportion.

In 10 years time, he said, whoever is still alive on the planet will be effectively starting again.

(my emphasis)

Why do I bother recounting these stories? Because I applaud all the bloggers who are working to publicize the Downing Street memo, I really do. I'm one of them, and people need to know. But ultimately it will have more of an effect on history than elections, because people in this country do not care. I just got finished watching The Trials of Henry Kissinger, which if you can get past the omnipresence of Christopher Hitchens and just focus on the Seymour Hersh part is a pretty interesting documentary. People did not care that Nixon was a crook, they knew it and they re-elected him anyway, they just wanted him to be a crook for them. As long as it insures American hegemony, they just don't care what kind of evil mutant father-raping shithole has his finger on the bomb.

The only thing that is going to bring about regime change is if people fear that America No More Number One, and that the bunch in charge is leading them down the path of economic calamity. It bounced both Carter and Bush I out of office. When people begin to believe that their prosperity is in jeopardy, then and only then are they going to vote to change the course of the country. In the mean time, bless John Conyers for making the Sith lords take even a moment away from charting our destruction to deal with him, 'cos it's a pure labor of love.

Their vision for the economy was Iraq. Well that didn't fucking work, did it. Greenspan is trying to keep the housing bubble alive until the next bubble comes along -- and that was supposed to be a Wall Street boon from raping Social Security. Doesn't look like that's going to work, either. They have no next best plan. Their next best plan was the bankruptcy bill, which insures that when the shit does hit the fan that working class people will have no escape, and Corporate America can still get theirs.

When and if that message finally gets across in the public consciousness, nobody is going to give a rat's ass about activist judges or Girls Gone Wild or Gay Pride floats in the middle of the Easter Parade. Let's just hope it gets out there before the collapse of epic proportions arrives and there's no turning back.