There I got that out of my system. China real estate is having problems, they are just giving BMWs away with apartments as an incentive. Riiiiiiggghhhtttt...
Chinese property buyers get BMW thrown in
By Simon Rabinovitch in Beijing
The sudden downturn in China’s property market is bad news for many global companies, but luxury German carmakers stand to benefit, at least in one city.
In Wenzhou, where house prices have fallen sharply, a real estate developer said that from Wednesday it would throw in the keys to a BMW with each apartment at a new residential complex for the first 150 buyers.
The deal is a sign of the desperation felt by developers in China’s once-booming property market, which has been pounded by government measures aimed at heading off a bubble. The slowdown is a matter of international concern, with Chinese house construction driving demand for commodities and propping up growth in the sputtering global economy.
Chinese developers have been reluctant to cut prices as transactions have slowed this year, but some are finally capitulating after dreadful sales in October. Others, afraid of the stigma of slashing prices, are offering giveaways such as extra garden plots, Louis Vuitton handbags, cruise vacations and now cars.
“Whoever signs a contract and makes the downpayment will be able to drive away in a BMW,” said the sales assistant at Central Mansions, a cluster of brown towers with 868 apartments that have just come on to the Wenzhou market.
“No, it doesn’t mean that sales are bad. It’s just that we’re trying to attract customers,” she said.
Home to legions of entrepreneurs and speculators, Wenzhou’s economy soared when China was flush with cash. But it has been hit harder than most cities by the government’s shift to a much tighter monetary policy to control inflation, as well as the property clampdown.
Wenzhou’s housing sector is now the weakest in the country, with prices falling 1.4 per cent in September month on month. Its smaller firms have suffered from a lack of bank credit, triggering dozens of bankruptcies and prompting the government to take action to boost financing in the city.
But while Wenzhou is an extreme case of the stress in China’s property market, it is certainly not alone. Housing prices have started to fall nationwide, according to the China Real Estate Index System.
That has been tough to digest for many Chinese who had come to believe that house values could only rise. When several developers in Shanghai cut their asking prices last month, homeowners protested, ransacking showrooms and demanding refunds.
Fearing similar fallout, many developers are trying to entice buyers with special deals instead of discounts. The BMWs in Wenzhou cost Rmb300,000 locally, equivalent to about 10 per cent of the price for an apartment, the sales assistant said.
Xiaoyunli No. 8, a development in Beijing that has sent workers to leaflet cars at busy intersections, said there would be no discount and no car for buyers.
“But you’ll get a deal and it will be no problem for it to amount to the tens of thousands. It will be like giving you a car,” the receptionist said.
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So Rick Perry is officially out of the running. I don't think there is any way he can recover from his "Howard Dean" moment last night during the debate. I'm glad because I think he would have been worse than our current Teleprompter in Chief. For those who didn't watch the debate, here it is. YYYEEEEEEAAAAAAHHHHHHHH!
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I notice gold is going to be down today, but I believe it has resumed it's bull run. I have several pieces about it today. As gold soars to new highs against the euro (and eventually the dollar), it's important to keep one major thing in mind…
Governments hate gold. They will soon take steps to make it more of a hassle to acquire, transport, and store. They might even, as some suggest, try to tie the idea of gold to terrorism.
The idea might be farfetched, but a desperate, bankrupt government is like a dangerous, bankrupt man. Its capacity for surprising stupidity should not be underestimated.
From Stansberry Research:
Why do governments hate gold, you ask? It's simple.
Gold is the "anti-paper currency." Unlike paper currency, gold has real "inherent" value and cannot be created on a political whim. In contrast, paper money has no real value... beyond the faith society puts in it. People must have faith that the money will remain relatively stable in value over time. They must TRUST the money.
Governments around the world exploit that trust to commit a huge fraud against their people. The fraud is that a government can spend incredible amounts of money, take on unlimited entitlement obligations, and support a bloated military empire without bankrupting itself and impoverishing its citizens.
Governments hate a soaring gold price because it alerts the world that their massive spending and borrowing plans are out of control. A rising gold price unmasks how all their campaign promises, bailouts, handouts, loans, wars, and entitlement programs constitute a huge fraud.
That's why the current set of political leaders – from the socialists in Europe to liberal East Coast Democrats to red state Republicans – will do everything in their power to keep citizens believing in paper money.
And since gold is "real money" – with real, intrinsic value – that has been used for thousands of years, it represents a tremendous threat to political elites like Barack Obama, John Boehner, and Nancy Pelosi.
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Jim Rogers thinks there will be a gold bubble years from now, but not until the price goes much higher.
Gold has many years left on its bull run, but the precious metal will eventually reach a bubble, famed investor Jim Rogers told CNBC Wednesday.
"It will easily go to $2,000 but it will reach $2,400 over the course of the bull run, which has years to run," said Rogers, the CEO and chairman of Rogers Holdings.
"It will end in a bubble when this is over. The way bull markets work is they go up and up and then by the end they turn into a bubble and that will happen to gold.
He said, however, that such a bubble is still years from happening.
"That could be five years, 18 years or six years," he said.
"I hope I am smart enough to sell but when that happens it will probably double." He said that currently he would buy silver instead of gold because it's cheaper on a historic basis.
"I own both, I'm not selling either but if I had to buy one today I would buy silver," he said.
Rogers said he was short stocks because he is not very optimistic about the fundamentals.
"You're better off in real assets than in stocks, at least I hope," he added.
Not everyone agrees with Rogers.
Ken Kamen, president of Mercadien Asset Management told CNBC that gold should not be used as an insurance product.
"I'm not a metal head. All this talk about gold suggests if you have it you have some sort of insurance policy.
Any asset class that fluctuates hundreds of points in a week is not a safe haven. Gold is not a silver bullet," Kamen said.
"It will easily go to $2,000 but it will reach $2,400 over the course of the bull run, which has years to run," said Rogers, the CEO and chairman of Rogers Holdings.
"It will end in a bubble when this is over. The way bull markets work is they go up and up and then by the end they turn into a bubble and that will happen to gold.
He said, however, that such a bubble is still years from happening.
"That could be five years, 18 years or six years," he said.
"I hope I am smart enough to sell but when that happens it will probably double." He said that currently he would buy silver instead of gold because it's cheaper on a historic basis.
"I own both, I'm not selling either but if I had to buy one today I would buy silver," he said.
Rogers said he was short stocks because he is not very optimistic about the fundamentals.
"You're better off in real assets than in stocks, at least I hope," he added.
Not everyone agrees with Rogers.
Ken Kamen, president of Mercadien Asset Management told CNBC that gold should not be used as an insurance product.
"I'm not a metal head. All this talk about gold suggests if you have it you have some sort of insurance policy.
Any asset class that fluctuates hundreds of points in a week is not a safe haven. Gold is not a silver bullet," Kamen said.
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Here is an article about some of the ridiculous taxes that are being proposed. The most absurd is the "Christmas Tree" tax.
In the pre-dawn darkness of a chilly LA morning, my day started off with a chuckle. A friend in the reforestation business sent me an email detailing the US Department of Agriculture’s new ‘Christmas Tree’ tax that was approved yesterday. I thought it was a joke. It wasn’t.
One can only laugh at the absurdity of the government getting involved in such a matter. But it’s happening more and more.
You see, the United States is on a one-way collision course with its financial judgment day; the country long ago passed the historical point of no return– the point at which it has to start borrowing money simply to pay interest on the money it has already borrowed.
Throughout history, countries that passed this point of no return soon defaulted on their debts, entered into extended periods of severe inflation, or both. This is nothing new– the idea of a government going bankrupt is practically as old as the concept of government itself.
Along the way as they slide down the slippery slope of economic calamity, governments typically hit the accelerator by resorting to financial repression; rather than making the economy open and attractive to talented people and investment capital, they instead confiscate, inflate, and overregulate.
These tactics include oldies but goodies like civil asset forfeiture, capital controls, and a host of whacky new taxes. Like a Christmas Tree tax, for example.
Sumptuary laws (regulation and taxes over lifestyle habits) are quite common, dating back to the Renaissance period ‘beard taxes’. If you wore a beard during the time of Peter the Great in Russia, or Henry VIII in England, you paid a tax to the government for the privilege.
There are many modern day equivalents of the beard tax– taxes on cigarettes, mobile phones, vehicles, luxury goods, etc. We should expect the introduction of even more– a national sales tax, an Internet tax, a carbon emissions tax, and a financial transactions tax.
After this, the next mind-boggling category of taxes that will be introduced are ‘social taxes’. In other words, you get taxed on what everyone else is doing… like an anti-terrorism security tax, or better yet, national healthcare where you pay for other people to go to the doctor.
During the Tokugawa period in feudal Japan, they called this ‘honto mononari’. Village peasants were taxed by the local daimyo on the basis of the entire village’s rice yield for that season. Even if you didn’t grow a single grain, you still paid.
Perhaps the most heinous forms of taxes to come, though, are asset taxes. And at roughly $5 trillion in total value, individual retirement accounts (IRAs) are the lowest hanging fruit that the federal government can grab.
It’s not that far-fetched. Argentina has done it. Hungary and Ireland have done it. Even France passed a law last year authorizing the government to use pension fund assets to pay off its debts. And if you recall, the US Treasury raided public pensions this year to tide itself over during the budget debacle.
The next step will be for the government to nationalize a portion of IRA assets. They’ll wait for a severe market downturn that wipes a huge chunk from most IRA accounts, blame capitalism for the failure, and then pass a law requiring that X% of IRA funds be held in the ‘safety and security’ of government debt.
If you think this can’t happen, then I encourage you to do absolutely nothing. Keep your IRA funds parked with a big, conventionally-thinking financial institution that has absolutely no interest in your financial security.
If, on the other hand, you can see the writing on the wall, then one of the biggest no-brainers you can undertake is establishing an Open Opportunity IRA.
This is a structure where YOU take control over your own retirement funds, opening up your savings to a world of possibilities and protecting against government confiscation.
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One can only laugh at the absurdity of the government getting involved in such a matter. But it’s happening more and more.
You see, the United States is on a one-way collision course with its financial judgment day; the country long ago passed the historical point of no return– the point at which it has to start borrowing money simply to pay interest on the money it has already borrowed.
Throughout history, countries that passed this point of no return soon defaulted on their debts, entered into extended periods of severe inflation, or both. This is nothing new– the idea of a government going bankrupt is practically as old as the concept of government itself.
Along the way as they slide down the slippery slope of economic calamity, governments typically hit the accelerator by resorting to financial repression; rather than making the economy open and attractive to talented people and investment capital, they instead confiscate, inflate, and overregulate.
These tactics include oldies but goodies like civil asset forfeiture, capital controls, and a host of whacky new taxes. Like a Christmas Tree tax, for example.
Sumptuary laws (regulation and taxes over lifestyle habits) are quite common, dating back to the Renaissance period ‘beard taxes’. If you wore a beard during the time of Peter the Great in Russia, or Henry VIII in England, you paid a tax to the government for the privilege.
There are many modern day equivalents of the beard tax– taxes on cigarettes, mobile phones, vehicles, luxury goods, etc. We should expect the introduction of even more– a national sales tax, an Internet tax, a carbon emissions tax, and a financial transactions tax.
After this, the next mind-boggling category of taxes that will be introduced are ‘social taxes’. In other words, you get taxed on what everyone else is doing… like an anti-terrorism security tax, or better yet, national healthcare where you pay for other people to go to the doctor.
During the Tokugawa period in feudal Japan, they called this ‘honto mononari’. Village peasants were taxed by the local daimyo on the basis of the entire village’s rice yield for that season. Even if you didn’t grow a single grain, you still paid.
Perhaps the most heinous forms of taxes to come, though, are asset taxes. And at roughly $5 trillion in total value, individual retirement accounts (IRAs) are the lowest hanging fruit that the federal government can grab.
It’s not that far-fetched. Argentina has done it. Hungary and Ireland have done it. Even France passed a law last year authorizing the government to use pension fund assets to pay off its debts. And if you recall, the US Treasury raided public pensions this year to tide itself over during the budget debacle.
The next step will be for the government to nationalize a portion of IRA assets. They’ll wait for a severe market downturn that wipes a huge chunk from most IRA accounts, blame capitalism for the failure, and then pass a law requiring that X% of IRA funds be held in the ‘safety and security’ of government debt.
If you think this can’t happen, then I encourage you to do absolutely nothing. Keep your IRA funds parked with a big, conventionally-thinking financial institution that has absolutely no interest in your financial security.
If, on the other hand, you can see the writing on the wall, then one of the biggest no-brainers you can undertake is establishing an Open Opportunity IRA.
This is a structure where YOU take control over your own retirement funds, opening up your savings to a world of possibilities and protecting against government confiscation.
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How many of you wish you had a bailout? This one is of epic proportions. Makes me sick...
The government-controlled mortgage zombie Fannie Mae announced a third-quarter loss of $5.1 billion today. And it requested another $7.8 billion in federal aid to stay afloat. The walking dead has now "borrowed" $112.6 billion from the U.S. Treasury. Despite the massive injection of taxpayer funds to date, Fannie Mae CFO Susan McFarland says the entity is working to "limit taxpayer exposure."
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