Get Woke, Go Broke – And Take the Neighborhood With You

Don’t believe their ad campaign. Lexington, Virginia wants you to believe they are not a town where hate has a home. Refusal To Serve Sarah Sanders Ruined Summer Tourism Biz Of Entire Town.

Remember when the owner of The Red Hen, a Virginia eatery, kicked Presidential spokeswoman Sarah Huckabee Sanders out of her restaurant last June? Well, three months later tourism in the region is still dead thanks to the Trump-hating restaurant making the area seem uninviting to visitors. And now locals are starting to worry that the Trump haters have destroyed their bread and butter.

And so an “emergency” ad campaign to tell you to forget what actually happened, and the hate spewed by one of their marquis businesses, they really want need your money.

Thus, the town’s tourism suffered thanks to the angry leftists who has made Lexington look like a bastion of hate. Who wants to go to a town where you might get refused service if they happen to find out you support a politician they don’t like?

Who would risk being treated like garbage when you are just trying to relax and enjoy yourself?

I don’t think they made it “look like a bastion of hate.” I think they just revealed the true situation to everyone.

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They Don’t See the Restrictions on Building as the Problem

So there are a lot of homeless people in California. And the LA Times is shocked to discover that .gov handouts are not the answer. Housing vouchers can save people from homelessness. But landlords may not accept them.

Here’s the problem in a nutshell.

Zillow data show median rent for a two-bedroom unit in L.A. County has soared 56% since 2012, to $2,700 in February. The HUD-approved “fair market rent,” meanwhile, rose 23.8%, to $1,791.

When you have price increases like that, you can be pretty sure that there is a supply/demand imbalance. And this imbalance – though the paper wouldn’t admit it – is a direct result (or at least in part) of the anti-growth policies of the state of California. Those policies were highlighted by the destruction of Paradise, California in last year’s Camp Fire.

“Big picture, we have 6,000, possibly 7,000 households who have been displaced and who realistically don’t stand a chance of finding housing again in Butte County,” Mayer said. “I don’t even know if these households can be absorbed in California.”

So there is a shortage of housing, and that housing is cruelly expensive, and all the LA Times can see is racism. Of course. Or it’s Trumps’ fault. (Or it will be if he actually cuts spending, which hasn’t happened yet.)

Though they do (in paragraph 34) admit that bureaucracy is part of the problem.

To an extent greater than other cities, she said, her mom-and-pop members in L.A. have complained about delayed housing inspections, delayed first month’s rent and lack of help with problem tenants, issues they say have worsened over the years. Since 2014, the number of landlords working with HACLA has fallen 7%.

The supply is extremely restricted. They can try all the solutions around the margins they want, but the supply needs to be increased. Instead they are making it even harder to build by passing “green requirements on building.” Yeah, that will help the homeless.

It’s Almost Like They Never Heard of Capital Gains Taxes

I was talking with a friend about the current state of the stock market. And in particular, the insanity in late December over the sell-off. See the image for an overview. (Clicking on it will enlarge the view, as always.) More on the image in a bit.

But of course the Left and the media (but I repeat myself) were HOPING for a stock market collapse. Because they were hoping that it would help them take out Trump.

Now we may be at the start of a Bear Market, or we may be near the end of a correction. But I guarantee that no one in the media knows what is coming next. If they could predict the future, they would have make a fortune already and be sitting on a beach somewhere. But let’s take a look at the December insanity.

I could make that list much longer of course, but you get the point.

One of the other sources I reviewed for that list (I forget which) said something like “It’s been a party for 5 years on the stock market.” Which is pretty much true, and it is why when November’s downturn hit, (Now is a good time to view that image) everyone who manages their own portfolio, and every financial planner and fund manager started looking at the question, “Are there any stocks where I want to take my profits?” and in mid-to-late December the question became “Is there anywhere I want to take a loss for tax purposes?” You know (or maybe you don’t), capital gains taxes also talk about capital losses.

It’s almost as if no one working in the media has ever paid attention to the stock market. Or the business cycle. Or taxes. Or anything. There is an entire investment strategy around looking for stocks that are ripe for tax sales, and then buying them between Christmas and the first week in January. Because if they were sold based on taxes, they will likely rebound. (Make sure they weren’t sold for fundamental reasons, or you could be part of the Dead Cat Bounce.)

But of course 99.9 percent of the coverage the stock market in December and January, wasn’t about informing the investing public, it was about destroying Trump, because even by December the “Russia! Russia! Russia!” attacks weren’t looking so good.

As I said at the start, I don’t know if this is the start of a bear market, or the end of a correction. When I look at things like housing sales and freight numbers, things look good to me, but I can’t predict the future. The point is, neither can any of the talking heads on the 24 hour news cycle.

The Leftist Media Is Screaming About the Upcoming Recession

Of course if anyone could predict the future, they wouldn’t be working in television.

So first up, there are some problems with the freight numbers, especially if you look at railroads. How The Widened Panama Canal Is Disrupting U.S. Domestic Transportation.

  • And East Coast ports appear to be prospering at the expense of West Coast ports.
  • All of this appears to be a secular and ongoing consequence of the widening of the Panama Canal that began accepting bigger ships in late 2016.

It used to be the case that everything from the Far East coming to the US came into West Coast ports (mostly LA), and went by train to the east. They even built special rail cars to carry 2 containers stacked, and still fit through the tunnels and under bridges. (Where I grew up, you were pretty much guaranteed to be on the wrong side of a 125 car train – plus 2 or 3 engines – at some point during the week.)

Trucking, in the meantime is going strong. February Tonnage Up 5.4%.

American Trucking Associations’ seasonally adjusted For-Hire Truck Tonnage Index in February was 117.4, a gain of 5.4% from the same period a year ago.

Sequentially, however, the index was down 0.2% after increasing 2.5% in January when the index was 117.6.

So the media is focused on “It’s declining!” But the folks in trucking note that you’re coming off record levels.

“After a strong January, I’m pleasantly surprised that the index didn’t fall much last month,” said Bob Costello, ATA chief economist. “I continue to expect tonnage to moderate like other indicators, including retail sales, manufacturing activity and housing starts. Additionally, the level of inventories throughout the supply chain have increased, which is a drag on truck freight.”

Trucking is a good leading indicator of the economy, as 70 percent of freight travels by truck.

There are other “problems” caused by the new Panama Canal. America’s highest paid union at existential risk from widened Panama Canal.

West Coast Longshore and Warehouse Union, whose members earn average wages and benefits of $285,000 by raising labor hell, is facing existential risk from the widened Panama Canal.

Go read that article if you are interested in the fate of the union that got kicked out of the AFL-CIO because it was too communist. (Precursor to the AFL-CIO.)

Now, will there be a recession? Eventually, sure. No one has undone the business cycle. Will it be this year? I don’t know, and neither do the pundits on the evening news.

Meanwhile in the Socialist Paradise of Venezuela…

This article has some info about the fallout of the power outage. Infrastructure crisis looms in Venezuela.

First up there is some info about the agricultural sector in the country.

Word from the countryside is that farmers have been unable to find seeds and fertilizer. And the planting season is about to start. Everyone from Wall Street analysts to Rodríguez, who has sold carrots, parsley, bananas and garlic here for decades, worries that this will be the year Venezuela’s agricultural sector collapses.

When Venezuela had 5 days without power, 4.4 million pounds of meat spoiled. No electricity. No refrigeration. Also no water pumping equipment.

As power shut down, the country’s aluminum industry was further crippled: Molten metal solidified and destroyed machinery. When power was restored, leaping voltage burned out computers, air-conditioning units and refrigerators. Transformers blew up.

Things will get a lot worse before they get better.

Sales of Existing Homes Rise

But the media keeps preaching at me about the impending recession. NAR: Monthly existing home sales reach four-year high.

The Northeast was the only region that didn’t participate.

Sales are up, inventory is down, and while January was bad in terms of sales, there is no talk of the weather, which wasn’t good in a lot of places.

First-time buyers comprised 32% of sales in February, an increase from both January and last February’s rate of 29%. NAR revealed that the annual share of first-time buyers held steady at 33%.

I’m sure the good news isn’t Trump’s fault, and equally sure that any bad news is.

A Play-by-play of What Happens When a Town Assumes Nothing Will Change

“Change is the only constant in the universe.” If you assume nothing will change, you will get run-over by inevitability. Courtland could ‘run out of money’ if golf course doesn’t sell.

There was a paper mill in the town. They assumed that it would be there forever. It wasn’t there forever.

In 1999 – assuming that nothing would change – a small town built an 18-hole golf course complete with a clubhouse and a maintenance building, for a little more than 3 million dollars. (They still owe 1.4 million and are paying about $12,000 a month to pay off the bond.)

Then in 2014 the mill closed, and in 2016 the company stopped paying “in lieu of ad-valorum” which was about 700,000 a year. And now the city or town is in deep yogurt.

The course’s bond holders are guaranteed on their investment, [Farrell Hutto, town councilman and lifelong resident of Courtland] said. “If we don’t sell it, (the bond company) will. Then they’ll sell the Town Hall and anything else until they get their money.”

They tried to sell the golf course, but there are covenants and restrictions that limit what can be done, so the auction didn’t reach the reserve they set.

The high bidder that day, Mount Hope farmer Sam Spruell, said earlier this month he wasn’t certain the purchase would have been a good investment. He said the covenants on the property near the Courtland Air Base limit how the land can be used.

The property currently cannot be used for residential development or as farmland for raising livestock, according to county records. Hutto said the property has built-in irrigation and six lakes that could lure a row crop producer.

“I’d probably turned it into a mixture of sod farm and row-crop farm,” said Spruell. “I might have sold some of it off.”

Covenants and restrictions are the ultimate hubris of the time, limiting what can be done with a bit of land, has put this town in a position where they will lose everything. Everything that can be sold to raise money to pay off a bond they should never have taken on in the first place.

How many people do you know under the age of 50 who play golf? Under 30? In 1999 you really couldn’t conceive the idea that the mill might close? That happened so many times it is literally a cliche.

The mayor says there is no plan B. So why didn’t they accept the offer of 700,000 bucks?

Courtland, Alabama isn’t alone of course. A lot of major cities are paying off bonds used to build ballparks and football stadiums, while their schools and pensions are ignored. It is just that being a small town, they are running out of cash faster than places like Chicago.