This'n'That; May 20th[Housing;LostDecade;SDCC]

Housing Crisis

[The current housing crisis is still on a downward trend, as indicated by the April, 2009 statistics below. The current housing dilemma was precipitated by members of Congress and the Clinton administration and was several years in the making. The individuals involved insisted that qualifications standards be lowered in order to qualify more individuals and families for mortgages they couldn't possibly afford. It took several years to get here; it'll take several years to get back to normal. With the Fluffy obama handlers now in the mix-mucking up the works-"normal" won't look like it used to.]

NEW RESIDENTIAL CONSTRUCTION IN APRIL 2009 BUILDING PERMITS Privately-owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 494,000. This is 3.3 percent (±2.3%) below the revised March rate of 511,000 and is 50.2 percent (±1.4%) below the revised April 2008 estimate of 991,000. Single-family authorizations in April were at a rate of 373,000; this is 3.6 percent (±2.2%) above the revised March figure of 360,000. Authorizations of units in buildings with five units or more were at a rate of 103,000 in April. HOUSING STARTS Privately-owned housing starts in April were at a seasonally adjusted annual rate of 458,000. This is 12.8 percent (±13.0%)* below the revised March estimate of 525,000 and is 54.2 percent (±6.0%) below the revised April 2008 rate of 1,001,000. Single-family housing starts in April were at a rate of 368,000; this is 2.8 percent (±16.3%)* above the revised March figure of 358,000. The April rate for units in buildings with five units or more was 78,000. HOUSING COMPLETIONS Privately-owned housing completions in April were at a seasonally adjusted annual rate of 874,000. This is 4.9 percent (±16.6%)* above the revised March estimate of 833,000, but is 15.0 percent (±13.6%) below the revised April 2008 rate of 1,028,000.

America-A Lost Decade? [America might well have a "lost decade!" The Japanese population came out of their lost decade relatively unscathed. Americans on the other hand, may well be financially damaged. While American similarities with Japan include relatively easy credit and previously high real estate values, there is no likeness what-so-ever with savings rates! Saving is a habit with the Japanese-with Americans it seems to be a "lost art!" Most Americans are similar to one of my sons-he saved his money only until ticket and transportation expenses were met for the next concert. While alot of Americans have changed their saving and spending habits, it won't last. They will suffer far more than the rest in this recession. With the socialist bent of the current presidential handlers, this country has a foe that the Japanese didn't have-the government going off on unnecessary tangents under the guise of aiding economic recovery. Why save your money? Fluffy obama will just find a way to take it from you-increased taxes and fees; added taxes and fees. As with Japan, America's economic development and expansion has or will soon, come to a screeching halt!]

The Lost Decade - Japan's Economic Crisis The economic miracle ended in Japan abruptly at the very start of the 1990s. A combination of incredibly high land values and incredibly low interest rates led to a position in which credit was both easily available and extremely cheap. This led to massive borrowing, the proceeds of which were invested mostly in domestic and foreign stocks and securities. Recognizing that this bubble was unsustainable, the Finance Ministry sharply raised interest rates, which popped the bubble in spectacular fashion, leading to a massive crash in the stock market. It also led to a debt crisis; a large proportion of the huge debts that had been run up turned bad, which in turn led to a crisis in the banking sector, with many banks having to be bailed out by the government. Eventually many banks become unsustainable, and a wave of consolidation took place leaving only four national banks in Japan. Critically for the long-term economic situation, it meant many Japanese firms were lumbered with massive debts, affecting their ability for capital investment. It also meant credit became very difficult to obtain, due to the beleaguered situation of the banks; even now the official interest rate is at 0% and have been for several years and despite this, credit is still difficult to obtain. Overall it led to the phenomenon known as the "lost decade"; economic expansion came to a total halt in Japan during the 1990s. The impact on everyday life has been rather muted, however. Unemployment runs reasonably high, but not at crisis levels (the official figure is a little under 5%, but this is a considerable underestimate - the real level is probably around twice that). This has combined with the traditional Japanese emphasis on frugality and saving (saving money is a cultural habit in Japan) to produce a quite limited impact on the average Japanese family, which continues much as it did in the period of the miracle.

Don't Forget Those Who Do Good Things Remember, most charities have the same financial needs no matter what the economy looks like; many have increased needs in a down economy. Our personal favorite-"Slam" Duncan's Children's Charities-does most of it's work in the summer and at Christmastime. I confess, I'm a bit behind the eight-ball this year; I haven't sent my contribution to aid the summer's activities. Our checks ["The Young Miss Lovely" and I donate separately] will go out with the morning's mail. If you don't have a favorite, consider Mister Duncan's efforts-his organization does many great things on a shoe-string budget [over 99% of donations benefit the kids]!!

Til Nex'Time....