Homebuyer tax credit: 950,000 must repay
The inspector general reported that 1,326 single people listed as dead by the Social Security Administration claimed more than $10 million in credits. The IRS threw out 528 of those 1,326 claims, saving $4 million.
Rumor has it that these 528 also have accounts at our nation's zombie banks and are still buying zombie products from our nation's zombie companies.
Bond investors headed for a doozie of a hangover: Mark Gilbert
The corporate-bond market looks even more like an accident waiting to happen. Investors decided to lend $400 million for 30 years to Stanley Black & Decker Inc. this month. They will be paid an interest rate of 5.2 percent by the toolmaker, which has total debts of $4.5 billion in the form of bonds and loans, according to Bloomberg data.
The job of a fixed-income investor is to balance risk and reward. That interest rate seems like an awfully skimpy reward for quite a big risk.
Peer three decades into the future. Tell me you don't see some new globetrotting enterprise from China -- where Western retailers now do most of their manufacturing -- employing the workers Stanley Black & Decker trained and undercutting the U.S. company with cheaper screwdrivers, drills and hammers.
Ouch.
There's also the connected problem of lax lending standards during the credit boom. The loan covenants that would normally get triggered when a borrower is in distress were watered down to the point of uselessness. So it is entirely plausible that zombie companies are blundering along in the twilight lacuna between alive and dead, distorting the default data.
Zombie companies blundering along in the lacuna? Is that our truth?
Clock is ticking while I’m killing time
Spinning all around
Nothing else that you can do to turn it back
A joke I liked a few years ago was that the search for risk-free return was rewarded by the discovery of return-free risk.
ReplyDeletedearieme,
ReplyDeleteVery amusing.
I suspect we'll be making similar discoveries in the coming years. Perhaps we can organize them in some sort of "periodic" table, lol. Sigh.
Actually, 3 decades into the future, I would not bet on Chinese workers being so cheap as to undercut Black and Decker. By that time, Bangladeshis could be undercutting the Chinese.
ReplyDeleteBecause there are also patents involved, it is also not so simple to overtake a market leader. Note, as market leader, they also can get patented products from factories who want to tap B&D's volume. I know of a tool company in Taiwan with major patent library - they sell mainly to two companies in the world because those companies can deliver massive volume. Their patents means they can charge higher prices. Note those two companies are branded importers not retailers.
Finally, another hurdle for the Chinese company is that they have to offer after sales service, repair, etc. It sounds simple, but Chinese companies aren't well known for this.
Coba
That said, I am not sure any company is immune for the fast speed of competition these days.
ReplyDeleteI had to look up the word 'lacuna'.
ReplyDelete1. gap: a gap or place where something is missing, e.g. in a manuscript or a line of argument (literary)
Zombie companies...perhaps it's a Dr. Ned world we have come to live in.
I knew the band but not he defintion of Lacuna!
ReplyDeleteCoba,
ReplyDeleteHeck, I can't even figure out how Safeway, QFC, and Albertsons stay in business. There's 3 of them near me and I do almost all of my grocery shopping at Costco, Sam's Club, and WinCo.
watchtower,
ReplyDeleteI burned out on Borderlands quite a few months ago. I have unburned though. For the past week I have been playing quite a bit, lol.
Dr. Ned
"Greetings loyal Nedcast viewership. Now in the third week of my clinical trials with corpse reanimation. The skin cells have reacted well to the treatment but the bodies themselves seem to have uncontrollable hunger. Right now, it seems all they crave is raisins and bran muffins, but I fear with strength applied to the reanimation their hunger will grow much stronger and possibly dangerous. Fear not, I will trudge forward unhindered by the possible destruction of mankind. Am I mad? Probably, but at least I DON'T MAKE POPCORN WHEN PEOPLE ARE TRYING TO WORK!"
GYSC,
ReplyDeleteThis song is SO stuck in my head.
Rock Band 2: Lacuna Coil
My best is about 98-99% on this song if memory serves (on expert bass).
Of course, some people are legendary at the game.
ReplyDeleteFull Band, no mistakes
The difficult guitar is on the left, drum centered, the bass on the right, and vocals across the top.
It's the remix version. Some people REALLY get into it, lol.
In the spirit of the Mark ripoff theme, I am ripping off the Lacuna Coil song for friday night, I might remember to credit you, maybe, HA!
ReplyDeleteGYSC,
ReplyDeleteLacuna Coil is getting swamped!
Borderlands is the only game that I really enjoy other than Fallout, that was an excellent recommendation by you.
ReplyDeleteNow if only those two games would join together...um, on second thought maybe not, that might lead to destruction, i.e. unmowed lawn, out of control facial hair, divorce, etc.
Lacuna Coil cover of Enjoy the Silence is fiing (pardon the language) awesome!
ReplyDeleteThe trailer for Fallout Las Vegas is creepy as all get out!
ReplyDeletewatchtower,
ReplyDelete"Now if only those two games would join together...um, on second thought maybe not, that might lead to destruction, i.e. unmowed lawn, out of control facial hair, divorce, etc."
You aren't even joking! Been there, done all of that. Still doing some of it. Fortunately, girlfriend likes video games and actually mowed the yard today. Shame on me. Or should I say shave on me? There is some excess facial hair, lol.
GYSC,
ReplyDeleteVegas is a disaster magnet!
The video gamers would have never centered a housing bubble there. It's always the first to go, lol.
I also shop at Costco and Walmart....but we ended up buying a lot at Raley's the local grocery chain. The food is fresher, in small amounts so less wastage, and the staff is really friendly.
ReplyDeleteCoba
http://finance.yahoo.com/news/Chinas-inflation-edges-up-apf-832275983.html?x=0
ReplyDeleteInflation at 3.5% in China (if you want to believe the stats)
"Much of the increase was fueled by a jump in food prices, which rose by 7.5 percent because summer storms and floods ruined crops and disrupted shipping."
I wonder if this is true. Its sort of like unemployment "unexpectedly" rising here or the Soviets having 75 years of "bad weather." I have heard this excuse used every time for food price increases in China.
Coba
Coba,
ReplyDeletePerhaps there is a correlation between higher oil prices and summer storms. The weather often affects retail sales here too for some strange reason. If it is hot, people aren't buying enough coats. If it is cold, people aren't buying enough bathing suits. Go figure. No matter what the weather seems to be, people aren't buying enough. Can't explain it. ;)
I blame giant jellyfish!
November 2, 2009
Japanese fishing trawler sunk by giant jellyfish
In all seriousness, I just watched a documentary about Japan's jellyfish invasion. Scary stuff.
November 27, 2007
Invasion of Jellyfish Envelops Japan In Ocean of Slime
Until 2002, these giant creatures were seen only occasionally in Japanese waters. But for the past five years, they have been swarming every year into the Sea of Japan, the water that separates Japan from mainland Asia. During the biggest invasion so far, in 2005, an estimated 500 million jellyfish -- not yet mature -- drifted in each day.
What's 500 million jellyfish per day among friends?
I think we converted quite a few folks to Lacuna Coil! I have never had so many emails saying "thanks for the music tip!". Thank you Mark for reminding me about that band, they are really good.
ReplyDeleteGYSC,
ReplyDeleteThis whole topic sucked me right back into Rock Band 2, lol. I lost quite a few hours playing Blondie's Rapture this weekend. I saw it in the downloadable content and was "forced" to buy it, you know, to help the economy and what not. ;)
$1.99 for a 7 minute song played many times? Serious economic stimulus!
Off topic:
ReplyDeleteMark did you read The Age of Stupidity's post on 'Why we don't need manufacturing'?
If so, do you think the guy has a point, or is he off base on this subject?
Any thoughts?
watchtower,
ReplyDeleteOh man. You really nailed the topic on my mind this week.
I've been thinking about that post since I saw it show up in my blog links. It has been partially responsible for my lack of interest in posting lately. It was just so depressing to see that.
He says he aligns himself with Warren Buffett in that post. Well, here's something Warren Buffett once wrote!
November 10, 2003
America's Growing Trade Deficit Is Selling The Nation Out From Under Us. Here's A Way To Fix The Problem--And We Need To Do It Now.
In effect, our country has been behaving like an extraordinarily rich family that possesses an immense farm. In order to consume 4% more than we produce--that's the trade deficit--we have, day by day, been both selling pieces of the farm and increasing the mortgage on what we still own.
The trade deficit is a MAJOR concern of mine. MAJOR.
So yeah, I think he is off base on this subject. Big time. His points would only be valid if we exported enough services to make up for the goods we import. We don't though. Not even close.
Thanks Mark.
ReplyDeleteThat is exactly the kind of insightfulness I was hoping for.
I had emailed that link to my brother today because he is always bringing up the fact that we have shipped our manufacturing overseas.
This guy's opinion had caught him off guard I could tell, and he said he would have to think on it some more.
Hope you don't mind, but I plan to send your responds to my question to him in hopes of furthering our discussion on the subject.
watchtower,
ReplyDeleteI'm glad you brought this topic up. It's really been weighing on me. Seriously.
Feel free to share anything I write. I'm just one of 300 miilion people in this country with an opinion.
My current opinion is that we're @#$%ed. I sure hope I change my opinion on that someday, lol. Sigh.