Economic Stories of Relevance in Today's World -- July 27, 2014

Gary Shilling: "Q2 GDP Was Closer To 1% Than To 3%. It Could Even Be A Negative Number" - Zero Hedge - Tyler Durden - July 27, 2014 - This week, in the aftermath of the Q1 -2.9% GDP disaster, the biggest "non-recessionary" drop in 67 years which was blamed on harsh weather (because there have never been harsh winters in the past 67 years), we get the first glimpse of what Q2 GDP was in the US economy. It is expected to print just shy of 3%. However, one person disagrees: Gary Shilling believes that not only will Q2 GDP be closer to 1% than to 3%, there is a fairly good chance it could be negative, which of course would mean that the US economy has officially entered a recession.                          Shilling's take:Special Report: No Spring Thaw
The consensus of economists looks for second quarter real GDP growth, which will be released July 30, of 3% vs. the first quarter at annual rates. It believes the 2.9% drop in the first quarter was cold weather-driven, and a rebound in the second quarter is the prelude to 3%-plus growth in the second half of the year. As in the last several years, the herd is likely to be disappointed.                       Consumer spending is 69% of GDP and it barely grew in the quarter. According to monthly data, real consumer spending fell 0.2% in April and 0.1% in May. June’s numbers aren’t released yet, but based on the correlation with retail sales, which are available for June, real consumer outlays rose just 0.1%. The jump in March from weak January and February gave consumer spending a higher starting point for the second quarter so we believe it rose 1.3% from the first quarter.                            With the ongoing business cost-cutting and job growth focused on hamburger flippers, hotel desk clerks and other lowpaid jobs, real wage growth to support consumer spending has been absent. Emphasis has also been on lower-paid part-time jobs. In June, they rose 1.1 million while full-timer positions dropped 708,000.


America's Lost Decade: Typical Household Wealth Has Plunged 36% Since 2003 - Zero Hedge - Tyler Durden - July 27, 2014 - Does it feel like you're poorer? There is a simple reason why - you are! According to a new study by the Russell Sage Foundation, the inflation-adjusted net worth for the typical household was $87,992 in 2003. Ten years later, it was only $56,335, or a 36% decline... Welcome to America's Lost Decade.                           Simply put, the NY Times notes, it’s not merely an issue of the rich getting richer. The typical American household has been getting poorer, too.                            The reasons for these declines are complex and controversial, but one point seems clear: When only a few people are winning and more than half the population is losing, surely something is amiss.

2008 Meltdown Revisited-There’s No Solution-Egon von Greyerz - USA Watchdog - Greg Hunter - July 16, 2014 - Gold and financial expert, Egon von Greyerz, says buckle your seat belts–a replay of the 2008 financial crisis will “soon return.”  Greyerz contends, “What happened in 2008 was expected by us for quite a long time.  The solution of $25 trillion to save banks and financial markets was not a solution.  It was just a temporary deferral of the problem.  The money, as we know, went into the banking system, and it didn’t go into the real economy.  The banks in Europe still have the same problems.  They are leveraged as much as before.  Deutsche Bank is leveraged 50 times.  U.S. banks are slightly less leveraged, but they have the derivatives that are not included on their balance sheets; of course, but if you include that, they have more leverage than the European banks. . . . We are now in a situation where every major economy in the world is in a total mess.”  Greyerz goes on to explain, “Japan’s economy is going to disappear into the Pacific.  China is having its problems.  Europe has problems.  The EU will never work and was not supposed to work.  The euro is an artificial currency and, in the long run, will not survive.  The U.S. stock market is at an all-time high, but that has nothing to do with the real economy which is an absolute mess.  So, the world has never been in a situation where all nations simultaneously are having problems that are insoluble.  Every major nation is running a deficit today.  So, right now, I think we are going to revisit 2008; but this time, there is no solution.”





85 Super Wealthy People Have More Money Than The Poorest 3.5 Billion Combined - Economic Collapse Blog - Michael Snyder, on July 27th, 2014 - The global economy is structured to systematically funnel wealth to the very top of the pyramid, and this centralization of global wealth is accelerating with each passing year.  According to the United Nations, 85 super wealthy people have more money than the poorest 3.5 billion people on the planet combined.  And 1.2 billion of those poor people live on less than $1.25 a day.  There is something deeply, deeply broken about a system that produces these kinds of results.  Seven out of every ten people on the planet live in countries where the gap between the wealthy and the poor has increased in the last 30 years.  Despite our technological advances, somewhere around a billion people go to bed hungry every single night.  And when our fundamentally flawed financial system finally does collapse, it will be the poor that will suffer the worst.                          Now, let me make one thing clear at the outset.                       Big government and more socialism are not the answer to anything.  Big government and more socialism almost always result in increased oppression and increased poverty.  If you want to see where that road ultimately leads to, just look at North Korea.                          What we need is a system that empowers individuals and families to work hard, be creative, build businesses and to take care of themselves.                           But instead, we have a system where all power and all wealth are increasingly controlled by giant banks and giant corporations that are in turn controlled by the global elite.  The "financialization" of the global economy has turned almost everyone on the planet into "deft serfs", and the compound interest on all of that debt enables the global elite to constantly increase their giant piles of money.


The Rot Within, Part I: Our Ponzi Economy - Of Two Minds.com - Charles Hugh Smith - July 21, 2014 - Depending on blowing the next bubble to temporarily prop up the economy is the height of foolhardy shortsightedness.                     All the conventional policy fixes proposed by Demopublican politicos, technocrats and the vast army of academic/think-tank apparatchiks are the equivalent of slapping a coat of paint on a fragile facade riddled with dryrot. All these fake-fixes share a few key characteristics:

1. They focus on effects and symptoms rather than address the underlying causes, i.e. the dryrot at the heart of our government, society and economy.

2. They maintain and protect the Status Quo Powers That Be--no vested interests, protected fiefdoms or Financial Elites ever lose power as a result of these policy tweaks.

3. They are politically expedient, meaning they assuage the demands of vested interests rather than tackle the rot undermining the nation.

4. They ignore the perverse incentives built into current systems and the incentives of complicity, i.e. to cheer another coat of paint on the dryrot rather than face the costs of real reform.

The financial underpinnings of the economy and society are rotting from within:finance, higher education, defense, healthcare, law, governance, you name it.                     This week I want to highlight a few key causes of this pervasive and eventually fatal systemic rot.                     Let's start with Our Ponzi Economy. There are three primary examples of our Ponzi Economy: pay-as-you-go social programs (Social Security, Medicare, Medicaid, etc.); housing and the stock market. All are examples of financial Ponzi schemes.                         All Ponzi schemes rely on an ever-expanding pool of greater fools who buy into the scheme and pay the interest/gains due the previous pool of greater fools. Ponzi schemes fail because the pool of greater fools is finite, but the scheme demands an ever-expanding pool of participants to function.                      All Ponzi schemes eventually fail, though each is declared financially sound because this time it's different. The number of greater fools required to keep the scheme going eventually exceeds the working population of the nation...



The Rot Within, Part II: Inflation Is Not "Growth" - Of Two Minds.com - Charles Hugh Smith - July 23, 2014 - Just as the Federal Reserve cannot directly force you to stick the needle of monetary heroin (debt) into your arm, it also can't force employers to pay employees more.                     The official policy of the Central Bank (Federal Reserve)/government is: inflation is necessary for "growth," i.e. economic expansion. The unstated reason for this official support of inflation is that it's easier for borrowers to service their debts as their income inflates.                        To take an extreme example: let's say a homeowner has a mortgage of $100,000, an annual wage of $40,000 and annual mortgage payments of $10,000. At 100% annual inflation in both prices and wages, the home mortgage remains fixed at $100,000, the payment remains fixed at $10,000 but his earnings double to $80,000.                        Where the mortgage payment initially took 25% of his earnings, now it only takes 12.5%. Yippee Skippy, the homeowner has an "extra" 12.5% of his earnings to support more consumption and debt: thanks to inflation, the homeowner can now buy a car on credit and use the "extra" 12.5% of earnings to pay the auto loan.                       Central banks around the world seek inflation for another reason: the Keynesian Cargo Cult that dominates all central banks and governments believes with quasi-religious certainty that people respond to inflation by buying more stuff now rather than later: since prices will rise in the future, it makes sense to buy stuff now at "lower prices compared to next year's prices."                    This is called bringing demand forward, as the demand to buy stuff is shifted from the future to the present.                 In an economy dependent on debt-based consumption, inflation is absolutely essential to reduce the real costs of servicing old debts so households can afford to buy more stuff on credit. This is the basis of the Fed's insistence that inflation is equivalent to "growth"--inflation enables households to continue adding more debt to buy more stuff, as long as earnings inflate along with prices.                       There are three problems with the Fed's "inflation is growth" scenario:

1. Earned income (wages and salaries) don't inflate along with prices
2. Rising inflation and low interest rates crimp lender profits and increase risks.
3. Bringing demand forward exhausts households' ability to fund additional consumption with debt.

To date, all the Fed's efforts to generate inflation have bypassed earned income: wages and salaries have declined when adjusted for inflation. Hourly wages: stagnant since 2008...

Former City Council Member and Union Square Icon Sally Fox jumps ship

Hound Note: This is a post from anonymous poster Common Sense. This person doesn't want their name out in the public arena for fear of reprisals. I don't believe what they have stated below can be construed as being personal or with malice. It just makes clear/concise points about issues that are very much relevant to the City of Hickory political and social dynamic.

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It is with great sadness that I must report on the passing of one of Union Square’s flagship stores – a Hickory institution, one might say. On second thought, passing may not be the appropriate term. For you see, what’s happening (or has happened) is far worse than a simple passing. The lauded Sally Company is packing up and leaving town (for greener pastures?).

Why does this even matter? Perhaps more appropriately asked is, how could this happen? Over her esteemed 20-year career of public service Councilwoman Fox championed such projects as the Hickory Farmers’ Market, organizations like the Downtown Development Association, and sadly the boondoggle that became "the Sails on the Square". She alone spearheaded Hickory’s effort to gain Main Street USA status (I’m sure it was something important) along with many, many other worthy projects to help promote Hickory’s very own diamond in the rough we all know as Union Square.

Sally Fox was certainly more than a well-wishing, policy-making, money-appropriating Council member. Yes!

Sally, out of her sense of pure, unadulterated civic duty threw herself into breathing new life into a revitalized downtown area. As an active member of the HDDA, Mrs. Fox saw to it (from her Council seat) that they received the taxpayer dollars needed to turn Union Square into what it is today – a sparsely occupied, over-priced, lacking-in-parking obstacle in ones way to the Hwy. 70 economic Mecca of Hickory.

Mrs. Fox also was a very vocal proponent of the Hickory Farmers’ Market being located on Union Square. The logic was circular (Rotary) at best. The Farmers’ Market is key to Union Square’s image and prosperity while at the same time Union Square is the only place to properly showcase an event such as the Farmers’ Market.

In the past, some have viewed Mrs. Fox’s involvement with the HDDA and Farmers’ Market boards, coupled with her position on City Council, as a potential conflict-of-interest. Balderdash!!!

How could she possibly be expected to help Hickory’s business owners succeed and families prosper, if she didn’t flourish first? Mustn’t one learn before one can do?

So what is the bottom line here? In Mrs. Fox, Hickory had someone that did promote (some would say single-mindedly) the downtown area. For much of her 20 years she argued and pushed for more City spending to be directed toward Union Square – after all it is the heart of our City, our front porch, our identity – and now after having left office a mere eight months ago, Mrs. Fox and The Sally Co. have left Union Square.

One of two things must be true. First, despite all of the public attention and taxpayer-funded investment in downtown, it simply hasn’t worked. I’ve always held the opinion that if spending more money on a problem solved it, then let’s just go ahead and solve the problems. As we know though, simply throwing more money at a problem in no way guarantees a solution. The second possibility is this – Mrs. Fox’s dedication to Union Square was solely self-serving. Since leaving public office, perhaps there is little cache’ that she can direct downtown (to her store) and it’s just not worth hanging around. But, who am I to say. Feel free to draw your own conclusions.

On a completely different note, I cannot pass up the opportunity to call Sally Fox out for what can only be categorized as being unashamedly two-faced. Now this may not surprise many people, as most already believe politicians to talk out of both sides of their mouths, but Mrs. Fox's actions/words simply disgust me. Over the past year, I have known her to express a most decidedly unfavorable opinion of Mayor Wright. Sidenote: This may stem from Mayor Wright having publicly espoused his opinion(s) of Councilwoman Fox in a recording I came across here on the Hound.

Regardless, Mrs. Fox is unmistakably not happy with the Mayor’s ability/style/etc. Now, given her personal feelings toward the Mayor – which she has made known to people publicly over the past year – how is it that she co-hosted a fundraiser for the Mayor during last year’s municipal elections? For Shame!!!!!

Mrs. Fox, I, like many, had high hopes for you and what we once thought you could bring our community. You began with a passion for people – a desire to build up our City from its heart, our neighborhoods. And to an extent you did succeed. But, you simply stayed too long. Twenty years is too long to serve in public office.

Why? You compromised.

You became pigeon-holed, relegated almost, to being the Union Square representative. And to get what you wanted Union Square to have, you were willing to turn a blind eye to many of the other struggles faced by others in our City – struggles I know you to have still cared about, but were unwilling to tackle for fear of….well, I don’t know what. At the very least it is unfortunate – although I take it a bit further and say inexcusable.

It’s sad to think of what Hickory may very well look like today, were you willing to hold tight to your convictions. Were you willing to stand up to Rudy. Think what could have been?

Sincerely,
Common Sense

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Hound Note: After this, what I'm thinking is, "Who's next?"

Breaking News: Ultimate Hickory Insider jumps ship

Here is the Catawba County Chamber's Young Professional's Survey

Catawba County Chamber of Commerce President Danny Hearn asked me to reach out to my readership with the Young Professional Survey being conducted by the Chamber of Commerce. I have referenced this survey a couple times here on the Hound and in the address I made to the City Council last week. Danny says that the survey is being conducted to find out what will keep the young people here and how they feel about Catawba County.

The Chamber is centering this survey on 19 to 44 year olds. They want you to be in that age bracket in order to take the survey. You should also currently either live here, or if you live outside the county, they want you to be employed here in order to fill it out.

 To access the survey, you can either click the hyperlink below OR use any QR Scanner app on an iOS/Android mobile device/tablet to scan the QR code below.


Here is the survey:
 http://survey.constantcontact.com/survey/a07e9e2mdklhvzju072/start

















Thank you in advance for your assistance.

Lindsay

Lindsay M. Keisler, IOM

Senior Vice President

Catawba County Chamber of Commerce

1055 Southgate Corporate Park SW

Hickory, NC 28601

**NEW DIRECT LINE: 828-431-7223

Fax: (828) 328-1175

lkeisler@catawbachamber.org

www.catawbachamber.org

Attracting the Younger Generations to this Community

Last Week, I spoke before the Hickory City Council in relation to what the Millennial Generation wants from a community. As many know who have followed this site, I have pressed this issue since before the inception of the Hickory Hound. I saw anecdotal evidence of the losses of the younger generations from family and friends leaving the area to seek opportunities elsewhere. Generation X and Y have been saying thanks, but no thanks to this community for a while now.

The local Powers that Be argued against what I was espousing. To put it simply, they said it was easier to target/market to/recruit what they termed active Seniors. Many of the PTB said it was nearly impossible to get the younger people to stay here, as though we should just give up. The economy and the demographics continued to worsen until they came to a realization... hey, maybe we need to try and get more young people to come and hang around here. Problem is that they are taking shots in the dark to make that happen. Deal is that it's more about the mindset around here than anything else, but what would one expect when 60 and 70 year olds are calling all the shots and their hired guns are only interested in keeping those millionaire style paychecks flowing. And following orders is easier to keep that happening, than taking chances, saying what needs to be said, and doing what needs to be done. We have to have policies that move us towards the goal. Instead what I have seen is the same ole local good ole boy economics, where it's not about buttering the bread, but about whose bread is going to get buttered.

I put this article together so that you will understand that what I spoke about last week wasn't off the top of my figmented imagination. I've looked into these issues for years, but don't take my word for any of it. Please do your own research. Enough for ranting, here's what I found:

Thoughts about the Hickory City Council meeting - July 15, 2014 - My Birthday Speech


What Millennials Want In The Workplace (And Why You Should Start Giving It To Them) - Forbes - Rob Asghar - January 13, 2014 - Gutfreund says that Intelligence Group studies of millennials have found that:

· 64% of them say it’s a priority for them to make the world a better place.

· 72% would like to be their own boss. But if they do have to work for a boss, 79% of them would want that boss to serve more as a coach or mentor.

· 88% prefer a collaborative work-culture rather than a competitive one.

· 74% want flexible work schedules.

· And 88% want “work-life integration,” which isn’t the same as work-life balance, since work and life now blend together inextricably.

Millennials are, in essence, “venture consumers,” Gutfreund says. They’re not looking to fill a slot in a faceless company, any more than a good venture capitalist is looking to toss money at a faceless startup. They’re looking strategically at opportunities to invest in a place where they can make a difference, preferably a place that itself makes a difference.

What Millennials Want Most: A Career That Actually Matters  - Forbes - Barry Salzberg, the global chief executive officer of Deloitte Touche Tohmatsu Limited - July 3, 2012 - ...Never mind the still sluggish job market. In their insistence on social principle, many millennials are not driven by money or success in quite the way their parents were. This generation wants to know what your organization stands for in improving society, what it stands for in action, as opposed to blowing smoke. Millennials want to know how they will make a positive difference in the world if they join your business, not by wearing a colorful T-shirt on a special project once a year but in their actual work.                                     Did I mention that this media-savvy generation is also jaded and suspicious? Unimpressed by title, well-traveled, and immune to P.R. in the old sense?  To anyone who imagines their heartstrings can be nimbly plucked, good luck.                               In August 2011, for example, students at top American schools—Yale, Harvard, Dartmouth, Stanford—were complaining about their peers going into finance and consulting, professions in which 25% of Yale grads launch their careers. They called such choices a “brain drain,” or “a tragedy of wasted minds,” as one Dartmouth undergrad put it. Deloitte signed up some 49,000 minds last year, so naturally this got my attention.                             We did some original research and discovered that these attitudes, conflicted as they can be, also reflect remarkable optimism and resilience, including an admirable willingness to tackle, head-on, society’s biggest issues. A slacker generation this is not.                    My organization examined the opinions of 1,000 millennials at Deloitte member firms regarding the impact of business on society. We found that more than half of them believe that in the future business will have a greater impact than anyone else in solving society’s biggest challenges.                     And 86% of them believe business will have at least as much potential as government to meet society’s challenges. Clearly, taken as a whole, millennials do not see business as a waste...


Millennials want more out of work - Young people change jobs frequently in search of fulfillment, flexibility - Chicago Tribune - Lisa Black - June 17, 2014 - ...About half of all American millennials are unemployed, underemployed or have given up looking for a job, Schawbel noted.                         About 21 million millennials live at home with their parents, he said. Many carry heavy student loan debt. And some are forced to constantly look for a better job — or work two or three part-time gigs at a time — simply to earn a living wage.                              "Allegiance to companies virtually doesn't exist among people my age because companies have made benefits so negligible," said one friend, who, at 28, has changed jobs already five times. I am not identifying her because I'd rather not expedite her move to Job No. 6.                           "We're just trying to survive in companies that don't care about employees like they used to," my friend said. "The days of starting your career and retiring with the same company are over."


11 Tips for Managing Millennials - About.com - Susan M. Heathfield

1. Provide structure.
2. Provide leadership and guidance.
3. Encourage the millennial's self-assuredness, "can-do" attitude, and positive personal self-image.
4. Take advantage of the millennial's comfort level with teams. Encourage them to join.
5. Listen to the millennial employee.
6. Millennial employees are up for a challenge and change.
7. Millennial employees are multi-taskers on a scale you’ve never seen before.
8. Take advantage of your millennial employee’s computer, cell phone, and electronic literacy
9. Capitalize on the millennial’s affinity for networking.
10. Provide a life-work balanced workplace.
11. Provide a fun, employee-centered workplace.

Economic Stories of Relevance in Today's World -- July 20, 2014

Gerald Celente interview on King World news - July 20, 2014 - Founder & Director of the Trends Research Institute, is author of the highly acclaimed and best selling books, Trend Tracking and Trends 2000 (Warner Books) and publisher of the Trends Journal®. Interview Link

Gerald Celente discusses the lack of pride in the United States. Money can't buy health. It takes self-responsibility. Americans have an "I don't care" attitude. Look at how people dress and their presentation. The bar has been lowered. Look what society has degraded into. Mr. Celente says this isn't because he is an old guy. America is leading the World on a downward trajectory with "I don't care." It brings down the whole bottom line, because people don't care what is going on around them...                     Art has become another Wall Street Scam. Art (today)is a whole lot of Bad Attitude... Fast Food is not Food. 1/3 of childhood population is obese. What goes in is what comes out...                                 No news just propaganda. Everything is orchestrated. Everything is phony. People swallow the propaganda like they swallow slurpees...               Plenty of wildcards. Everyone knows the markets are rigged. Surprises will be geopolitical unrest/instability. Gives examples around the world. Geopolitical unrest, social unrest, and ecopnomic panic. Governments will do anything they can to keep the Ponzi scheme going. Governments are trying to get people's minds off the financial issues. When all else fails they take you to war.

Look out: 'Burrito inflation' is here - CNN Money - Ben Rooney - July 20, 2014 - ...Many companies in the food industry have been hiking menu prices recently as wholesale prices for everything from beef and pork to coffee and cocoa have risen sharply this year.                     Coincidentally, the government will release a report on June consumer price inflation on Tuesday. The CPI index for May showed an increase that was double what economists had expected, raising concerns that inflation is heating up.                          


New Internet speed record blows past Google Fiber - CNN Money - David Goldman - July 10, 2014 - Bell Labs researchers just broke the broadband Internet speed record.                        It is eight times faster than the previous record -- and it was done over copper landlines.                          With speeds of 10 gigabits per second, Bell Labs' technology proved to be 1,000 times faster than traditional broadband speeds. It is even 10 times faster than Google (GOOGL, Tech30) Fiber, which offers the fastest broadband available to consumers.                           Alcatel-Lucent (ALU), Bell Labs' parent company, dubbed the new technology "XG-FAST." The company called it a "major breakthrough," giving broadband companies the ability to provide fiber-optic-like speeds over the existing copper landline infrastructure that blankets most of America.                            Verizon (VZ, Tech30) FiOS, Google Fiber and others have sought to bring ultra-fast fiber connections directly to people's homes. But the process is extremely expensive, and often involves digging up homeowners' yards. Providing fiber to the majority of American households could cost hundreds of billions -- or even trillions -- of dollars, depending on various estimates.


Subprime woes are back: This time in used cars - CNBC/New York Times -Jessica Silver-Greenberg and Michael Corkery - July 20, 2014 - ...This is the face of the new subprime boom. Mr. Durham is one of millions of Americans with shoddy credit who are easily obtaining auto loans from used-car dealers, including some who fabricate or ignore borrowers' abilities to repay. The loans often come with terms that take advantage of the most desperate, least financially sophisticated customers. The surge in lending and the lack of caution resemble the frenzied subprime mortgage market before its implosion set off the 2008 financial crisis.                   Auto loans to people with tarnished credit have risen more than 130 percent in the five years since the immediate aftermath of the financial crisis, with roughly one in four new auto loans last year going to borrowers considered subprime -- people with credit scores at or below 640.                       The explosive growth is being driven by some of the same dynamics that were at work in subprime mortgages. A wave of money is pouring into subprime autos, as the high rates and steady profits of the loans attract investors. Just as Wall Street stoked the boom in mortgages, some of the nation's biggest banks and private equity firms are feeding the growth in subprime auto loans by investing in lenders and making money available for loans.                       And, like subprime mortgages before the financial crisis, many subprime auto loans are bundled into complex bonds and sold as securities by banks to insurance companies, mutual funds and public pension funds -- a process that creates ever-greater demand for loans.                     The New York Times examined more than 100 bankruptcy court cases, dozens of civil lawsuits against lenders and hundreds of loan documents and found that subprime auto loans can come with interest rates that can exceed 23 percent. The loans were typically at least twice the size of the value of the used cars purchased, including dozens of battered vehicles with mechanical defects hidden from borrowers. Such loans can thrust already vulnerable borrowers further into debt, even propelling some into bankruptcy, according to the court records, as well as interviews with borrowers and lawyers in 19 states.                       In another echo of the mortgage boom, The Times investigation also found dozens of loans that included incorrect information about borrowers' income and employment, leading people who had lost their jobs, were in bankruptcy or were living on Social Security to qualify for loans that they could never afford.                      Many subprime auto lenders are loosening credit standards and focusing on the riskiest borrowers, according to the examination of documents and interviews with current and former executives from five large subprime auto lenders. The lending practices in the subprime auto market, recounted in interviews with the executives and in court records, demonstrate that Wall Street is again taking on very risky investments just six years after the financial crisis.                     The size of the subprime auto loan market is a tiny fraction of what the subprime mortgage market was at its peak, and its implosion would not have the same far-reaching consequences. Yet some banking analysts and even credit ratings agencies that have blessed subprime auto securities have sounded warnings about potential risks to investors and to the financial system if borrowers fall behind on their bills.                    Pointing to higher auto loan balances and longer repayment periods, the ratings agency Standard & Poor's recently issued a report cautioning investors to expect ''higher losses.'' And a high-ranking official at the Office of the Comptroller of the Currency, which regulates some of the nation's largest banks, has also privately expressed concerns that the banks are amassing too many risky auto loans, according to two people briefed on the matter. In a June report, the agency noted that ''these early signs of easing terms and increasing risk are noteworthy.''                   Despite such warnings, the volume of total subprime auto loans increased roughly 15 percent, to $145.6 billion, in the first three months of this year from a year earlier, according to Experian, a credit rating firm...



Microsoft to cut up to 18,000 jobs over next year - USA Today - Brett Molina - July 17, 2014 -
Microsoft confirmed it will cut up to 18,000 jobs over the next year, part of the tech titan's efforts to streamline its business under new CEO Satya Nadella.                        In a statement released Thursday, Microsoft says about 12,500 of the professional and factory positions will be cut as part of its $7.2 billion acquisition of Nokia's handset business.                                       Nadella, who replaced Steve Ballmer in February, says the "vast majority" of employees affected by layoffs will be notified within the next six months. They will also earn severance and job transition help in many locations. All cuts will be completed by next June.                        The layoffs by Microsoft -- which employs 125,000 people -- are the company's largest ever. The acquisition of Nokia's handset business in April added 25,000 people to Microsoft's payroll.                                            Microsoft is the latest tech giant suffering through a round of layoffs. In May, personal computer company Hewlett-Packard announced it would cut an additional 11,000 to 16,000 jobs as part of a massive restructuring. Earlier this year, IBM said it would take a $1 billion charge for "workforce re-balancing."                   Chip maker Intel and network-equipment maker Cisco Systems both said in the past year they were cutting about 5% of their workforces.​


Millennials buying homes later in life - USA Today - Josh Boak, AP Staff - July 19, 2014 -
The analysis suggests that the recession — for all its damage to the economy — did little to turn off Millennials from the idea of owning a home compared to previous generations. In fact, the report shows that the major group whose ownership rates suffered because of the downturn is middle-aged Americans.                          The easy credit offered during the housing bubble caused more young people to buy than they otherwise would and masked the impact of the demographic changes, according to Trulia. The bursting of that bubble and the resulting recession that began in 2007 then caused ownership to fall where it should be, given the demographic shifts. Because a greater percentage of younger Americans are attending college and graduate school, they are settling down a few years later — which causes them to delay buying a home.                            Census figures show that the share of 18-34 year-olds who are married is 30%, down from 47% in 1983. Just 29% of them live with children, compared to 39% three decades ago. Since more people in the age range are single and childless, Trulia looked at the number of homeowners who are also identified as the head of their households. After adjusting for these population shifts, the share of people under 35 years old who own homes is the same as it was for 1997.                 Standard Census data, which aren't adjusted for these factors, show that the ownership rate among those younger than 35 has declined to 36.2% from 38.6% in 1997. Slightly less than 65 percent of the country owns a home, down from a peak of 69% in the middle of 2006.                       While the weak economic rebound has affected home buying, Trulia's analysis puts more of an emphasis on demographics than much of the real estate industry has to explain poor sales.


Three Charts Of The Week: Money Printing Is Not Bringing Prosperity To Main Street - Tyler Durden - July 20, 2014 - Submitted by David Stockman of Contra Corner blog, - Furious money printing by the world’s major central banks is not generating real growth and prosperity—–but professional economists never seem to get the word. As shown below, the 2014 outlook for global real growth has been marked down sharply since early 2013. Back then, of course, Abenomics and massive QE by the BOJ was supposed to cause the Japanese economy to soar; Draghi’s “anything it takes” bromide was going to jolt Europe out of its slump; and the elixir of QE3 was certain to finally cause the US economy to attain “escape velocity”.                          Its not working out that way. In Japan, import inflation is soaring, real wages are still falling and the economy is entering a new slump in Q2 owing to a tax increase that was unavoidably necessary to pay for its runaway fiscal largesse. In Europe, the Bank Of Italy, Draghi’s home base, has now marked its forecast of 2014 real GDP growth to essentially zero. And in the US after the disastrous first quarter, along with what is shaping up to be a tepid second quarter, real growth will not achieve any kind of velocity, “escape” or otherwise; in fact, consensus real GDP has already been marked down to 1.7%—the lowest rate of expansion since the financial crisis. Accordingly, it is only a matter of time before the global forecast for 2014 shown below below is marked down even further.

Newsletter about the City Council meeting of July 15, 2014

I began video recording the City Council in 2012, because of my desire that the City do it on their own as any modern 21st century community began doing long ago. I had people tell me that they couldn't make it to the meetings, but they would like to see what is going on. I was also told by some council members that my summaries did not truly reflect the record, so having a video/audio recording cannot be misinterpreted.

So below is the City Council meeting. With each agenda item, you can click on the links and it will take you to that specific point in the meeting. You can always drag the marker on the video display to the point in the broadcast that you are interested in seeing.

Agenda about the City Council meeting of July 15, 2014

Thoughts about the Hickory City Council meeting - July 15, 2014


Invocation by Rev. Bill Garrard, Retired United Methodist Pastor


Special Presentations
A. Proclamation for National Federation of the Blind of Catawba County Day to Mr. Dawson Hart 
B. Recognition of the Hickory Crawdads Staff and Connie Kincaid for Crawdad’s All-Star Bash, June 16, 2014
C. Presentation of Retiring Members of Volunteer Boards and Commissions

Persons Requesting to Be Heard
A. Mr. Jeff Hines regarding Horseford Cove and the Glenn Hilton Park Area - (per Hickory Inc.) - addressed Council on concerns of debris, pollution and sediment in the Horseford Cove area. He discussed measures that had been taken in the past to correct some of the problems in this area.
B. James Thomas Shell - (per Hickory Inc.) - discussed the ten reasons why Hickory is not attracting and keeping young adults in the area.
C. Meredith Ross - (per Hickory Inc.) - spoke to Council regarding the Old Lenoir Road Business Association. She presented photos of businesses located in the area.
D. J.D. Ross - (per Hickory Inc.) -  addressed Council also on the Old Lenoir Road Business Association. He discussed the difficulty of maneuvering on the streets in Hickory. He would like to see Welcome signs from Old Lenoir Road directing people to downtown Hickory.
E. Larry Pope - (per Hickory Inc.) - discussed an application that he had submitted for the Citizens Advisory Board. He also discussed the issuance of Community Development Block Grant funds and representation in Ward 4... also he has called his Ward representative four times and has not had a phone call returned.
F. Tami Abernathy - (per Hickory Inc.)  - Ms. Tami Abernathy spoke to Council regarding needs that should be addressed in the Ridgeview Community... Only has seen her ward representative Hank Guess at the Ridgeview Reunion - none besides that.

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Hound Note: Check out the tone of the Mayor towards everyone else and then the tone towards Larry. The Mayor isn't going to comment on what I said, because he knows I get to rebut it publicly, and with near immediacy, in this forum, but I encourage him to address what I have said. I certainly am cursing the darkness, and will continue to do so, as I shine my light into that darkness.

Mr. Hines issue needs to be remediated. We're going to allow that garbage to build up in that major cove. while we study the issue? That seems unheathy.

Meredith and J.D. had a positive message about the Old Highway 70 association of businesses and corridor and they came before the council without a hand out. We don't often see that. They shouldn't expect anything from the council until they can provide a photo-op. This council has already chosen how they want to confiscate and disburse the eggs.

Larry Pope has a legitimate gripe, I have seen the mayor basically respond with some quip every time Larry speaks. I have witnessed it time and time again. If you get up and support the Council or are an insider, then the Mayor and this Council have a completely different manner in which they will treat you as opposed to when you say something that they judge as critical, especially when there is a history. Some of that can be dismissed as Human Nature, but as a governmental body, these people shouldn't be so overt in how they expressly support some cause and summarily dismiss and tune out others. This Council has the rest of the meeting. This Persons requesting to be Heard is supposed to be for the public to express themselves. Why does the Mayor feel it is incumbent upon himself to take over this part of the meeting, especially when he refuses to allow a back and forth dialogue with people he doesn't agree with? 

Larry Pope also has a legitimate issue with the same non-profits always get the money and Hickory Inc. doesn't audit them. That is part of the 21st Century Platform - #8. But, this is an issue of control. No one is getting any money out of the Hickory Inc. treasury, unless Hickory Inc. in some way, shape, or form has its tentacles embedded into that organization, not as a method of accountability, but in the manner of quid pro quo. Ms. Abernathy made valid points about how Ridgeview has been ignored by Hank Guess and the Council. The Mayor tried to softly dismiss her. Larry's point about calling Hank is not new. It has been going on since Hank took that seat. Old Hickory will say, "Hell yeah, Ridgeview ain't gittin nuthin," as they chuckle with their ole South Drawl... and others choose to stick their head in the sand (or somewhere else) and pretend that no issue exists. Everyone knows that this council doesn't do **** for the south side of the tracks. Some endorse it and some choose to ignore it. The mayor shouldn't lie about it.

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Consent Agenda: 

New Business - Public Hearings
1. Consideration of Text Amendment (TA) 14-02 to the City’s Land Development Code. - Planning Director Brian Frazier presentation - this item was tabled until the second meeting in September. It was directed to be sent back to the Planning Commission to be reworked regarding modifying temporary and seasonal sales. They want to discourage "fly by night" businesses. (Council Debate of the issue)

2. Request to Amend Vacant Building Grant Agreement from Jack Sipe Construction Company.  - Dave Leonetti presentation- Council passed unanimously

3. State Honors 38 Utilities for Meeting Stringent Voluntary Goals.  -Kevin Greer - An honor for water quality from the Federal EPA standards - Enhanced monitoring and Standards have been put in place to assure that water quality will maintain these standards.


General Comments - per Hickory Inc.
Mr. Berry recognized interns in attendance, Ms. Camille Hill and Ms. Meghan Williford, from Elon School of Law. They are clerking with Deputy City Attorney Arnita Dula for the next several weeks.

Mayor Wright commented on his vacation in Alaska, where they spent several days in Anchorage. They have a beautiful, and one of the most extensive, bikeway and parkway systems in the United States. They encountered two moose while on it, and where told that there was a black bear right around the corner, but when they got there it was gone. We don’t have those kinds of natural resources to share, but what a beautiful thing that they have, we probably would never be able to duplicate that because of the timing and the way our streets fall. It would be an admirable goal to try to have some bikeways, and walkways.


The Hickory Inc. Key to Success