Hot New Trend: Assisted Living

June 4, 2016
Yahoo Finance: I checked out WeWork's 'communal housing,' and now I'm considering a move

Of course, the concept of communal housing isn’t novel. But WeLive aims to combine the best aspects of dorms, boutique hotels and apartments, and it charges up to $2,800 a month for this unique living situation. If you’ve ever stepped into a WeWork, there’s an inviting, modern, minimalist aesthetic that’s been infused into WeLive, too.

Isn't novel? Junior assisted living is the best thing since senior assisted living! So what's the catch?

There’s a laundry room with ping pong and pool tables, arcade games and beer on tap. Members do have to pay for laundry — $2 for a wash, $2 for a dry. And there’s an unmanned “honesty corner” with toiletries for sale. Members use their WeLive app to pick up a bottle of shampoo or a tube of toothpaste if they’re running low and are feeling too lazy to run to Walgreens (WBA). Essentially, WeLive wants to be your one-stop shop for anything you need.

Too lazy to run to Walgreens? What? Something tells me those Viagra prescriptions, boxes of condoms, and home pregnancy test kits aren't going to just magically appear in the honesty corner! Hey, what age group is this place aimed at? Lots of single young men and women living together in a coed-dorm environment and all they can think up is shampoo and toothbrushes? That's it? Seriously? Hahaha!

Seems like they've got the game room covered but what about all the other stuff? Fitness center? Computer lab? Media center? And where are the P-Patch planters? Seems like they don't understand their target market at all!

Well, I hope they at least thought to put mirrored ceilings above the communal waterbeds. Give it that retro 70s feel. Very popular with the ladies.



Enjoy life at Tri-Court with amazing new amenities: fitness center, computer lab, media center, game room, even P-Patch planters. Just be over age 60 with a moderate income.

Bad Mark. Bad! Bad!

I may have seriously crossed the line of polite conversation today. So be it. Behold the power of anonymous blogging. Hahaha! :)

Simple Solution to China's Toxic Debt Problem

June 2, 2016
Bloomberg: China Toxic Debt Solution Has One Big Problem

“We don’t have enough domestic institutional investors with the expertise to price such complex products,” said Ming Ming, Beijing-based head of fixed-income research at Citic Securities Co., China’s largest brokerage.

Need something priced? In a hurry? Check out CNBC's Mad Money lightning round! Proven track record of instant pricing!

“Lack of qualified investors, especially in the junior tranche, will make it hard for banks to sell NPL-backed securities and constrain their development.”

Looking to advertise your products to less qualified investors? Let the masses see what you're selling! CNBC's Mad Money!

The problem is that most Chinese insurers, trusts, brokerage firms, and mutual funds lack the expertise to invest in bonds backed by bad loans, according to Luo Yi, a Shenzhen-based analyst at Huatai Securities Co.

If the loans are truly bad, no expertise needed! Once again, think Mad Money!

Cramer's Wachovia Autopsy (2008)


Wachovia

Exposed to risky loans, such as adjustable rate mortgages acquired during the acquisition of Golden West Financial in 2006, Wachovia began to experience heavy losses in its loan portfolios during the subprime mortgage crisis.

Got bad loans? Looking to dump them? Cramer's your man!

Kids These Days Have It Made?

June 4, 2016
USA Today: New grads have a huge retirement savings advantage

They do? Even with student loan debt incredibly high and interest on savings incredibly low? Seriously? This I gotta see!

Hold on. This better not be another clickbait article. Should I take the risk? No! I shall not click!

Kids these days have it made

Your elders might harbor a mild subconscious jealousy about your situation for reasons other than time. You’ve got a lot more going for you than you might think, including:

A low starting salary: In a certain context, being undercompensated has its perks. After all, your paycheck can only go up from here, right?

Dammit. I clicked, didn't I?

Forehead. Desk. Whack. Whack. Whack.

Hey, at least I miraculously skipped over the article's 6% compound interest rate assumption without actually spraying Kool-Aid out my nose. Perhaps I'm finally becoming desensitized to the clown horn!



Dammit. I spoke too soon. Gets me every time! ;)

What "They" Should Do Next

June 3, 2016
Bloomberg Editorial Board: What the Fed Should Do Next

It needs to avoid the suspicion that it's dithering and that super-low interest rates will be available indefinitely.

Who's suspicious?

Just because I write an Illusion of Prosperity blog, am a long-term holder of long-term US bonds, Japan's short-term interest rates have been below 1% for more than 20 years, our short-term interest rates have been below 1% for more than 7 years, a record $10 trillion in global debt has negative yields, our banking system must endure negative interest rate stress tests in order to boost dividends or buy back shares, and Janet Yellen won't rule out negative interest rates as a monetary policy tool, it does not necessarily mean that I am suspicious.

In fact, I could believe that the future's so bright, I gotta wear shades!

Morgan Stanley's Cunning Plan

June 3, 2016
How Morgan Stanley Plans to Stop Employees From Jumping Ship

New office chairs? ;)



April 18, 2016
Morgan Stanley Quarterly Profit Beats Estimates on Cost Cuts

Revenue fell 21 percent to $7.79 billion, compared with the $7.76 billion estimate of 18 analysts surveyed by Bloomberg. Non-interest expenses slid 14 percent to $6.05 billion, below the $6.42 billion estimate. Compensation expense dropped 19 percent to $3.68 billion and non-compensation costs declined 6.2 percent to $2.37 billion.

Two Questions for NAR's Lawrence Yun

December 11, 2001
What lower rates mean for you

"A cut...won't affect the 30-year fixed mortgage rate at all," said Lawrence Yun, a senior economist at the National Association of Realtors. "According to Freddie Mac, the 30-year fixed rate was 6.8 percent last week, and we think it'll stay about the same. But another interest rate cut could mean a slight drop in the short-term one-year adjustable rate mortgage (ARM)."

Let's say, for the sake of argument, that the Fed spends the next 6 years jerking rates around in the name of financial stability. There's a completely unexpected housing bust that nobody could see coming. The Fed spends a year brutally hacking at those high rates with an axe, Lizzy Borden style. And then finally, the Fed sits on those new rates, stuck to the floor, like a grizzly bear desperately trying to protect her cubs. Would that affect the 30-year mortgage rate much?

I only ask because I'm trying to figure out how the mortgage rate got down to 3.63% this week.

My next question is easier.

When the economy does eventually slow down again, if it hasn't already, where can I score some more mortgage rate heroin? I have grave doubts about my dealer's ability to easily meet demand next time, lol. Sigh.

Bad Mark. Bad! Bad! ;)

Eddie Lampert's Hometown Fries

Oops. My personal headline robot has run amok again.

No, this story isn't about the burning of the town where Eddie Lampert once grew up.

No, this story isn't about a new and exciting fast-food restaurant created by the legendary Wall Street whiz kid and his dedicated staff of corporate executive minions. It's too bad though. An artisan Craftsman burger has a nice ring to it.

It's simply a story about more of the same. Very expected. Very dull. Very boring. Sorry about that.

June 3, 2016
Sears Hometown reports 1Q loss

HOFFMAN ESTATES, Ill. (AP) _ Sears Hometown and Outlet Stores Inc. (SHOS) on Friday reported a fiscal first-quarter loss of $3.6 million, after reporting a profit in the same period a year earlier.

June 3, 2016
Analyst: There's 'No Reason' For Consumers To Shop At Sears

"They don't have any reason for being anymore," he also told Bloomberg.

That kind of naysaying negativity has no place in America. Stating the obvious like that causes irreparable damage. Investors who buy high and hold low don't want to hear it. Trust me on this. It's just not their style.

Breaking News: Traders Who Believed in the Fed Now Declared as Clueless as the Fed

June 3, 2016
Bloomberg: The Fed Is as Clueless as You Are

As clueless as I am? I beg to differ! The wise and omnipotent Fed can do no wrong, whereas I, just yesterday, nearly forgot where I put my car keys. Took me 10 extra seconds to find them. No joke. I'm not even in their league! I am humbled that you would think so though. Very humbled.

Bond traders are looking for certainty in an uncertain world, so it's comforting for them to think the Federal Reserve has some secret trove of economic data or corner on wisdom that it uses to make Important Decisions, like the timing of interest rate increases.

I bought long-term bonds. I own long-term bonds. I'm not a bond trader. I'm a bond consumer. That said, I do find comfort in thinking that the wise and powerful Fed is not only omnipotent, but also omniscient. Great comfort. In some ways, this blog is dedicated to their wisdom and the unintended consequences of their wisdom.

Some analysts noted that the Fed has lost credibility. But perhaps traders have just had too much faith in the omniscience of central bankers all along.

Can one ever truly have too much faith in the Fed? Was Ben Bernanke not Time's Person of the Year in 2009 for his masterful role in navigating us through the most disastrous economic bloodbath in modern times? You know, the near total and utter economic collapse that the Fed was supposed to prevent in the first place?

Perhaps I am wrong. Perhaps we can all be as clueless as a small group of elitist ivy league economic fortune tellers working behind closed doors blindly staring at antique rear view mirrors, who also think that they alone can and will be smarter than the markets as a whole. Or am I simply overestimating the power of sarcasm? ;)