At Advisor Perspectives Keith Jurow suggests that the recovery in housing prices has been greatly exaggerated, largely buoyed by the increases in the San Francisco, San Jose, and Los Angeles markets:

The three housing markets with the highest profit percentages are all major California metros. This is no accident and not a surprise. More than a year ago, 40% of all the outstanding bubble-era non-prime mortgages in California had already been modified, a percentage much higher than any other large state. This percentage has risen steadily from 17% in early 2011. Because of these modifications, the overall delinquency rate is much lower in California.

The result has been the complete collapse of foreclosures in California – from 30,000 at the peak in August 2008 to a mere 2,000 in August 2016 according to the highly-regarded California Real Property Report. The removal of so many of the lowest priced homes from the market, has artificially inflated both Case-Shiller and median sale prices in California.

Housing demand has been stimulated in California by two major factors. One is the employment boom in Silicon Valley due to the tremendous growth of five Internet giants – Apple, Google, Amazon, Facebook and Netflix. The other is the huge influx of wealthy buyers from China looking for a safe haven for their money. This has caused the high-end markets in both the San Francisco and Los Angeles metros to soar.

By comparison housing prices in Chicago are still 3% below peak. In most of the metropolitan areas of the United States housing prices have increased only 1% to 10% from their values in 2008. Cumulative inflation over the period has been about 15%. In other words except in select markets people have been losing money on their houses.

At Slate Jamelle Bouie articulates a strategy for seizing control of the Democratic Party from its present domination by a bunch of septuagenarian white folk—give it to a septuagenarian black dude:

But the history of the Democratic Party contains a model for moving forward, with an approach, honed by Jesse Jackson, that bridges the divide. And thinkers in the political and policy world have crafted solutions that reflect this approach. It respects the reality of the modern Democratic Party: a formation that represents—and depends on—the votes of women, young people, and people of color.

because there’s nothing that proclaims your bona fides as the party of youth, vigor, and new ideas like an inability to find leaders who are under 70 years of age. That’s sure to cheer up “demoralized Democrats”. I noted with amusement that the photos of Rev. Jackson used to illustrate the post were 35 years old. It reminded me of nothing so much as the official bios of aging operatic divas, proudly illustrated with what by all evidence were their high school graduation photos.

When you cut through the persiflage in Mr. Bouie’s post, you come up with the old post-modernist discussion of authority—legitimacy vs. authenticity and, clearly, in Mr. Bouie’s eyes Rev. Jackson is automatically authentic because he is black. What a frail vessel for such hopes!

Karl Marx once declaimed that history repeats itself, first as tragedy then as farce. We appear to have already entered the farce stage.

The official statement by Under-Secretary-General for Humanitarian Affairs and Emergency Relief Coordinator Stephen O’Brien on the situation in Aleppo is here. I went after it after reading three news reports, none of which linked to it or quoted it directly and each of which, as it turns out, misreported the statement. Here are its opening paragraphs:

I am extremely concerned about the fate of civilians as a result of the deeply alarming and chilling situation unfolding in Aleppo city.

Intensified ground fighting and indiscriminate aerial bombardment over the past few days in eastern Aleppo city has reportedly killed and injured scores of civilians. There are no functioning hospitals left, and official food stocks are practically finished in eastern Aleppo. At the same time, indiscriminate shelling continues on civilian-populated areas and civilian infrastructure in western Aleppo, killing and injuring civilians, and displacing over 20,000 people in recent weeks. Civilian infrastructure continues to be purposefully destroyed across Aleppo.

The intensity of attacks on eastern Aleppo neighbourhoods over the past few days has forced thousands of civilians to flee to other parts of the city. Initial reports indicate that up to 16,000 people have been displaced, many into uncertain and precarious situations. It is likely that thousands more will have no choice but to flee should fighting continue to spread and intensify over the coming days.

That wasn’t so hard, was it?

It contains little real news and doesn’t cast much light on the question I asked yesterday: are the civilians in Aleppo fleeing towards the Syrian Army or away from it? At least it tells us what Stephen O’Brien and, presumably, the United Nations organization think about the situation.

Just about everything else seems to be confabulation.

In his Wall Street Journal column James Taranto asks a simple question about the mealy-mouthed reactions from world leaders to Fidel Castro’s death: why?

Most of the public reactions to Castro’s death were true to form: Those on the right rightly mourned his life, not his death; while those on the left offered praise or at best neutrality, in either case playing down the horrors he inflicted on Cuba over more than half a century.

That includes Canadian Prime Minister Justin Trudeau and our own president. He also gives credit where credit is due:

The most notable exception: Nancy Pelosi, beleaguered leader of the House Democrats. “After decades under Fidel’s doctrine of oppression and antagonism, there is hope that a new path for Cuba is opening,” she said in a statement Saturday. How much hope is an open question: Cuba is still a one-party communist state ruled by the Castro family; Fidel’s younger brother, Raul, has held the title of president since 2008.

What caught my eye were the mocking tweets lampooning some of the leaders’ praise:

Andrew Coyne: “While a controversial figure, even detractors recognize Pol Pot encouraged renewed contact between city and countryside.”

Curtis (@FowlCanuck): “Today we mourn painter and animal rights activist, Adolf Hitler. His death also highlights the need for suicide awareness”

Peggy Noonan: “Booth was a fiery, forceful actor; he once left members of a Washington audience literally standing and screaming.”

Some of the remarks reminded me of nothing so much the famous comments made by Italians after the appointment of Benito Mussolini that he had made the trains run on time.

I tend to adhere to the Latin dictum, de mortuis nil nisi bonum (speak no ill of the dead). Heaping praise goes a step too far.

Why did Justin Trudeau and President Obama make the statements they did after the announcement of Castro’s death? The only explanation I can come up with is that it’s what they would have wanted to be said after their own deaths. The problem with that is that Barack Obama is no Fidel Castro. You can’t even make the claim that Castro was well-intentioned with a straight face.

I like this essay by Steven L. Blue at IMPO very much. Here’s a snippet:

What is the sense in spending millions on automating your factory if our workforce could care less? What is the sense in buying expensive machine tools if your workforce can’t wait to get to the bowling alley, yet drag themselves to work?

I’ll tell you why. Because too many CEO’s view their employees as expendable assets. They should view them as renewable resources. And renew them.

IMO the objective of too much automation (maybe too much management) is to absolutely minimize payrolls rather than to build the best possible company. One of the big problems is that by the time managers realize the error of their ways the damage has already been done.

The New York Times is reporting that rebels in Syria have left the areas of the north-east of the city they occupied and that the Syrian Army is advancing to secure those areas:

BEIRUT, Lebanon — Thousands of people were sent fleeing for their lives on Monday as rebel fighters lost a large swath of territory in the northern Syrian city of Aleppo to government forces and Kurdish fighters, in what could prove to be a turning point in the conflict, both militarily and psychologically.

Residents described desperate scenes of people being killed by shells as they searched for shelter after their homes came under the heaviest bombardment yet in a grinding battle that has destroyed entire neighborhoods of the city, once Syria’s largest and an industrial hub.

At least 4,000 people have been registered with the Syrian Arab Red Crescent in a government-controlled western neighborhood of Aleppo, Jibreen, Jens Laerke, the United Nations humanitarian spokesman, said on Monday.

As the rebels absorbed the harshest blow since they seized more than half the city four years ago, it seemed increasingly likely that President Bashar al-Assad will eventually manage to take back all of Aleppo. That would give the Syrian government control of the country’s five largest cities and most of its more populous west, leaving the rebels fighting Mr. Assad with only the northern province of Idlib and a few isolated pockets of territory in Aleppo and Homs provinces and around the capital, Damascus.

There seems to be some confusion about the direction in which refugees are fleeing. The report above along with others I’ve seen seems to suggest that refugees are fleeing to western Aleppo. That’s towards the Syrian Army not away from it. Other reports say they’re fleeing the Syrian Army.

We’ll probably need to wait for the fog of war to lift before we actually know what’s going on.

Update

The independent news site South Front has noticed the same thing:

According to headlines in the mainstream media, the local population is running from “regime forces”.

Unfortunatelly, they just forgot to mention that locals are running to the “regime-held areas”.

At this point I’ve lost the ability to distinguish the fake news from the real news. The propaganda being dished out by notionally news sites has reached critical mass. A key example of this is that major news outlets seem to think that South Front is a Russian disinformation outlet while South Front seems to think that the major news outlets are dealing out propaganda from the U. S. government.

You probably won’t be surprised that in William Finnegan’s lengthy history of Venezuela under Chávez and since in his New Yorker piece only two explanations for Venezuela’s economy having been left in tatters are presented. The Venezuelan government’s position:

I asked about the current food shortages and failing hospitals. “It is an economic war totally orchestrated by fascistic factions on the right,” Ruiz explained. “In every country, you have an oligarchy, a bourgeoisie, working to prevent other groups from gaining power. Our economic situation is imposed by outside powers, by transnational companies like Polar.”

The government constantly cites this “economic war,” secretly directed from Washington, to explain the gutted economy. Polar is Empresas Polar, Venezuela’s leading manufacturer of food and beer. Polar has been threatened with expropriation, and is harassed and vilified by the government as a treacherous bastion of capital, but it has become indispensable to feeding the country. Ruiz explained that Polar is responsible for shortages because it has reduced production. Polar’s management contends that it cannot import essential ingredients, because the government, which controls all foreign exchange, declines to provide the dollars necessary. These claims are false, according to Ruiz. “They have enough.”

or that it’s just too complicated for us mere mortals to understand:

Understanding Venezuela’s failing state as just another failure of socialism, and of statism generally, is ahistorical. Venezuela before Chávez was often extravagantly statist. Corruption has been a major problem in every era. Even dire food shortages are not new. These things happened under capitalism, too, as did intense political repression. Today’s crisis is for most people the worst in memory, but it is not all about socialism. The predatory state, the extreme insecurity, the sheer weakness of the rule of law—these are problems more profound, at this stage, than a traditional left-right analysis can clarify, let alone begin to solve.

Actually, it’s quite simple. Making economic decisions politically always introduces inefficiencies into an economy. That’s as true in Venezuela as it was in the Soviet Union or Mao’s China or as it is in today’s United States or North Korea. Those inefficiencies are what I’ve been referring to here at The Glittering Eye as “deadweight loss”. China’s economy was supine until it incorporated some market economics into its system.

When enough decisions are made politically, incentives are completely bolloxed up. People do things they shouldn’t and don’t do things they should. They hoard. They become profligate.

When you add rampant corruption to the mix, something inevitable when economic decisions are made politically, it makes matters that much worse.

Stir in monetary mismangement and you’ve got Venezuela.

Speaking of presidents of the imagination, one of the benign outcomes of a Trump presidency might be to move Republicans once and for all to put the image of Ronald Reagan they’ve built up in their minds behind them. Reagan cut taxes and built up the military to scare the heck out of the Soviets, his approach to fighting communism. That was about it.

He didn’t eliminate any federal departments. He didn’t cut the size of government. He pulled our troops out of Lebanon with their tails between their legs. The economy grew in the 80s through a combination of Reagan’s cheerleading, cultivating Keynes’s “animal spirits”, and garden variety Keynesian fiscal stimulus conjoined with consistent Fed policy. What he did accomplish was reinstilling a sense of confidence in Republicans after Watergate, Nixon’s resignation, and the slow growth of the 1970s.

As James Taranto wrote in his Wall Street Journal column last week:

During the campaign, some Nevertrump conservatives had an annoying tendency to use “Reagan”—meaning what they imagined the 40th president would think and do today—as a rhetorical device to portray Trump’s supporters as apostates from conservatism.

Some are still at it. One of them is Evan McMullin, the former CIA officer and congressional aide who ran as a “true conservative” independent, receiving 0.4% of the nationwide popular vote and topping 20% in his native Utah. In response to the Moore report, he tweeted: “For conservatives who didn’t see this coming, it should be a wake up call. Trump is going to expand the size of the Federal Government.”

Then again, so did Reagan—or, to be precise, so did Congress during his presidency, usually with Reagan’s assent.

The problem with not knowing history is that you’re doomed to repeat your imagined accounts of it over and over again until you believe that what you say happened actually happened.

At Financial Times Edward Luce is already nostalgic somewhat prematurely for the Obama Era or, as he puts it, “Barack Obama’s world”:

Whatever precise form Mr Trump’s administration takes, we know this: Mr Obama’s legacy will be purged. In many cases all it will take is the stroke of Mr Trump’s pen.

The Obama erasure will go far deeper than undoing domestic laws, or foreign deals. Mr Trump will repeal ObamaCare, or alter it beyond recognition. He will “keep an open mind” about whether to pull the US out of the Paris agreement on climate change and quite probably blow up the US-Iran nuclear deal. These acts would undo Mr Obama’s most visible achievements. Less obvious ones, such as the ban on Arctic drilling and enhanced interrogation techniques and the intention of closing Guantánamo Bay (never completed) will also be consigned to the dustbin. It will be as if Mr Obama was never here.

I think he’s remembering a Barack Obama of the imagination rather than the one that actually sits in the Oval Office. The Barack Obama I recall cultivated no friendships, enlisted no allies, cut no deals, built no coalitions, formed no consensus, and generally disdained the ordinary political process that presidents have used to accomplish their goals and make them stick. He relied exclusively either on pure power politics or simply governing by fiat. That’s not salving problems by reason as Mr. Luce would have it. That’s using brute force.

He may be overestimating how much of President Obama’s legacy can be “consigned to the dustbin”. For many of his signature accomplishments the costs were frontloaded and the benefits backloaded. The costs have already been sunk with the benefits if any barely or still to be realized.

Sadly, President Trump shows very few prospects of improving on President Obama’s record. Do you see him as somebody who will use the ordinary tools of politics to build consensus? I don’t.

Still, the greatest prophet may astonishingly end up being Michael Moore who years ago predicted that Barack Obama would be remembered solely for being the first black president.