Miscellaneous And Off Topic Subjects

[Dr. Strangelove]

Trump campaign's SW Ohio operation a total shambles with less than 3 months to go

http://www.cincinnati.com/story/news/politics/elections/2016/08/10/email-trump-campaign-scrambling-sw-ohio/88514306/

[Wild Hoss]

This thing may be enough in the bag for me to consider voting 3rd party.

[entropy]

This thing may be enough in the bag for me to consider voting 3rd party.

[entropy]

We must import the only good Indian engineers and IT people. My company moved a large segment of IT development to India (1/3 the cost) and they aren't worth a flying fuck. We spend probably half the time it takes to develop and execute a project just fixing the shit they produce. On the other hand, the two that we have here stateside are top notch. My management is pretty much clueless to the concept of penny wise pound foolish.

We've had great success in letting our teams in India manage mature code, after hours monitoring and CCL development.

[Ghengis Jon]

That could be the difference, managing mature code versus development from spec.

[froot loops]

A lot of it has to do how much the company is willing to pay. The rates are going up over there.

[Da Geezer]

We have a whole lot of rent seeking in this economy disguised as entrepreneurship. One problem is that it requires smaller banks employing real humans as loan officers and connected to their local communities. The old, pre-Glass/Steagall version of deposit banking.

Exactly. Last August I sold an interest in a community bank. The straw that broke the camel's back was when a young friend of mine wanted to pledge two rental houses to purchase a third rental house. He wanted to give the bank a mortgage on all three in order to get the money to buy one (all 3 had about the same value).

Dodd-Frank effectively prohibits this. The human loan officer could have just as well have been a computer. No judgment needed or desired anymore. As I have said, I believe TARP was effectively a nationalization of the financial sector. Maybe it was necessary, but I'd have let the banks go bankrupt. There is "moral hazard" in all of this intervention; investors saying to themselves, "well....the government will have to bail us out if it gets too bad.". Profit in good times, bailout in bad.

IMO, the banking sector does well relative to the rest of the economy in deflationary times. Historically, that is why banks and bankers have been seen as villains. Because they were/are! I read an article some time ago where an analysis was done on inflation v. deflation in the real estate sector, and since 1895 to say 2014, 45% of the years saw a drop in real estate values. 1895 was chosen because it was the start of a recession, but still, 45% surprised me. When times are hard, the banks are there to scoop up the pledged assets.

[hack]

Why does Dodd-Frank prohibit it?

I like the sentiment in your last paragraph. I think it would really help the national debate if people stopped viewing economic policy as a matter of whether the private sector or public sector is in the driver's seat. The private sector is not a monolith and key constituents' interests are not the same. More often they clash.

[Da Geezer]

Hack:

Is there an actual argument for deflation? I get it in the immediate short term, but nobody wins long term. Calling it a tax cut seems like the ultimate way to cut off your nose to spite your face. But I haven't looked at deflation enough to know.

Good point. The only argument I've ever heard in favor of deflation was during the late 70s and early 80s and that was only relative to excessive inflation. I'm not sure who would benefit from long-term deflation.

None of this takes into consideration relative values of currency either. For example, as the dollar strengthens, we in the US see a drop in the price of oil, all else equal. In countries where the currency is dropping in value, they see a rise in the price of oil (and this is independent of oil being denominated in dollars).

What gives me a brain-fart is that all is decidedly not equal. Ever. Example: I paid $ 1,200 for my first Commodore 64. I paid $ 500.00 for my laptop. This doesn't just mean that computers have dropped in price. It means they have dropped in absolute terms, but we are not even measuring qualitative changes.. Phrased differently, say that your i-phone has roughly the same capabilities as the on-board computers in the Apollo missions. Now there is real deflation because billions of people have smart-phones. I could make the case that deflation viewed in this way is a benefit to all.

[Da Geezer]

Why does Dodd-Frank prohibit it?

It has to do with equity (which I call being fair, and you know what I think of that word). The underlying assumption in Dodd-Frank is that people who were hurt during the housing bust were not responsible for their predicament. D-F bans balloon clauses, teaser rates, and seller financing of residential properties (unless one becomes a "mortgage originator" with all the bureaucracy that entails). So D-F sets so many rules that banker discretion really cannot happen. The rule my friend ran into was that the mortgage has to be free of other security in order to sell it to the government. All this would be moot if the banks had to keep the mortgages that they generate.

Example: When I did a development, I used to sell the bare lot to a builder and take back a mortgage. He would then go to a bank and seek a loan, and the bank would request me to subordinate his debt to me to his debt to the bank. He used my lot as the down payment. Small builders find this attractive.

I cannot see why I am not allowed to do a deal that I have done all my life with a two or three-man building company. This is not charity. Basically, I get a premium for the lot by allowing the builder to use the lot as his down payment. Fair deal. And it works.

But now I have to sell for cash. This doesn't negatively affect Pulte because they have a ton of cash, but it sure does hurt the mom-and-pop builders. I'd rather have four small builders working within a project than one big one. Less risk. I just don't feel it is the government's business to tell me how to market my projects.

[The Oracle]

Was your friend trying to take cash out of the other 2 rentals for the downpayment for the 3rd? I know banks hate that on rental units.

[Dr. Strangelove]

If Clinton only wins the states in which she's currently leading by 10 points or more, she'll win 270 electoral votes.

[The Oracle]

Should be a nailbiter.

[Da Geezer]

Was your friend trying to take cash out of the other 2 rentals for the downpayment for the 3rd? I know banks hate that on rental units.

No, and I understand your question. In this case, he offered to pledge three houses for security in order to borrow all of the purchase price of one house. He owned the first two outright, debt-free. In essence, he was putting down 66%, but that down payment was in the form of equity. And you are right, the banks don't like to loan on rental units in general. In a crash, they would be the first type of asset jettisoned.

[hack]

Hack:

Good point. The only argument I've ever heard in favor of deflation was during the late 70s and early 80s and that was only relative to excessive inflation. I'm not sure who would benefit from long-term deflation.

None of this takes into consideration relative values of currency either. For example, as the dollar strengthens, we in the US see a drop in the price of oil, all else equal. In countries where the currency is dropping in value, they see a rise in the price of oil (and this is independent of oil being denominated in dollars).

What gives me a brain-fart is that all is decidedly not equal. Ever. Example: I paid $ 1,200 for my first Commodore 64. I paid $ 500.00 for my laptop. This doesn't just mean that computers have dropped in price. It means they have dropped in absolute terms, but we are not even measuring qualitative changes.. Phrased differently, say that your i-phone has roughly the same capabilities as the on-board computers in the Apollo missions. Now there is real deflation because billions of people have smart-phones. I could make the case that deflation viewed in this way is a benefit to all.

But that's not deflation, at least in the way in which people speak of it. That's a technology that matured, including the benefits of economies of scale.