The tanking of the US housing market might actually act as a catalyst for something good for us in Toronto. And it's not just good for the lucky few who already own property, it also could help those who will be jumping into the market for the first time this year.
The US Fed has cut interest rates by a total of 1.25% in the past 10 days in an effort to stave off what some are calling an inevitable recession.
Tuesday, February 5, 2008
US Recession and the Toronto Real Estate Market
U.S. Education Department to Probe Program for Black Men on 16 CUNY Campuses
The U.S. Department of Education has opened investigations at 16 campuses of the City University of New York to determine whether a program to improve the enrollment and graduation rates of black men violates federal civil-rights law.
In April 2006, the New York Civil Rights Coalition filed a federal complaint with the Department of Education’s Office for Civil Rights about CUNY’s proposed “Black Male Initiative,” which the civil-rights group charged would offer “remedial and differential treatment” to students based on race and gender. The group argued that such a segregated pedagogy violated Title VI of the Civil Rights Act of 1964 and Title IX of the Education Amendments of 1972.
The Office for Civil Rights received that complaint in May 2006, followed by a second complaint from the same group, in June 2006, charging discrimination in the hiring of staff members for the program.
“In order to investigate the allegation in the most thorough and appropriate manner, OCR determined it would open individual complaints against each of the 16 colleges,” said Jim Bradshaw, a Department of Education spokesman.
In 2006 a CUNY spokesman told The Chronicle that the system was not planning any race-exclusive programs, but that it was considering the promotion of gender-focused programs to help black men. The program under attack was part of a four-year master plan called the “Initiative on the Black Male in Education,” approved by the CUNY Board of Trustees in 2004.
“We will, of course, continue to fully cooperate with the Office for Civil Rights,” Jay Hershenson, a CUNY spokesman, said today. “CUNY is confident that [the program] will be recognized for its great work in fostering access and success to the benefits of education, including to those who are underrepresented in higher education.”
According to the civil-rights group, the CUNY institutions that are under investigation are the John Jay College of Criminal Justice, Kingsborough Community College, LaGuardia Community College, Baruch College, Brooklyn College, City College, Lehman College, College of Staten Island, Medgar Evers College, Hostos Community College, Hunter College, Queens College, Queensborough Community College, York College, the CUNY Graduate School and University Center, and the New York City College of Technology.
—JJ HermesPosted on Monday February 4, 2008
Stop Illegal Immigration NOW Or Immigrants Will Soon Out Vote You
I have a neighbor named George. He and his family have been great neighbors. We’ve exchanged gifts, attended parties together, helped each other out from time to time with one thing or another. Our kids have been friends. I like them all. They’re really great folks.
However, all but the father and one son out of a family of six are illegal immigrants by way of Mexico.
Last year, two of their sons got caught up by immigration and sent back to Mexico. George’s wife moved back to Mexico to be with her sons. George stays here with the eldest boy and their daughter. He works hard and misses his wife. Of course, she cannot come back because she was never a legal resident and has no papers.
It’s all a terribly rotten situation for George and his family and I know that I would be highly upset were I in his situation. But, his situation is not unlike that of millions of other families that have a mixture of legal and illegal members living in the U.S.
And therein lies a problem. Yes it is a problem for them, but it is also a problem for anyone interested in stricter border control and enforcing current immigration laws or creating new ones. And it is a problem that looms larger every single day. It is a problem that is born of our own democratic system: Voting.
You see, once a Mexican national (or other immigrant) becomes a legal, voting resident he comes to have his fair, democratic say in the process. Ordinarily, it is a fine thing that a new citizen exercises his newfound duty to become a voter as a new member of our society. But, in this case, if that new voter has illegal immigrant family members, he comes to the polls with a built in prejudice against U.S. sovereignty and border control.
In essence, when asking a newly legalized U.S. citizen to vote on tougher immigration laws, we would be asking him to vote to allow his mother, father, sister or brother to be deported. By asking for this new voter to vote on stricter border laws, we are making it tougher for his extended family, should they be illegals, to visit and work here.
A recent Pew Hispanic Center survey has some interesting results on these issues. The survey asked Hispanics living in the U.S. a battery of questions and their answers reveals a split between the foreign born and those born here in the U.S. But, on several areas the two segments agree.
- On the question of drivers’ licenses for illegals, the foreign born are 55% in favor of allowing undocumented aliens to get licenses. The native born are 60% against that idea.
- 89% of the foreign born say that immigrants “strengthen the United States,” whereas only 65% of the native born agree with that claim.
- 76% of the foreign born claim that cheap labor provided by illegal immigrants is good for the U.S. while only 55% of the native born agree.
Notice that the native born are not as welcoming as the foreign born? But, here is the thing. The more foreign born we allow in and who later become citizens, the more apt we are to overpower the native born sentiment.
Here are some more alarming numbers.
- 53% of registered voters of Latino descent agree with giving licenses to illegals.
- 43% think there is no reason to decrease the level of immigrants coming into the U.S.A.
- And a whopping 84% think legal status should be bestowed on all illegals here.
As the foreign born begin to become legal citizens, their permissive attitudes will naturally grow in number and influence. This favorable attitude toward illegals will find echo in more and more legislation and that legislation will have more and more possibility of passage as the number of voters who feel sympathy with illegals grows.
And the thing is, this is all only natural. After all, once the border is abandoned as it has been and people get used to coming and going as they please, it becomes harder and harder to curb that assumption of a “right” to that open border. Can we really blame the immigrants when our own government has allowed this situation to occur? And can we really blame legal citizens to vote against stringent immigration policies when they have family members here who are illegal or have some that want to come here?
Victor Davis Hanson wrote about this in 2003 in his book Mexifornia, but it seems that his warnings have fallen on deaf ears in the halls of our Federal government. In fact, we have a man running for president on the GOP side that is an open borders advocate and it looks like John McCain is a viable candidate, too. None of this bodes well for U.S. sovereignty.
But, things may be looking up on the state level. Drivers’ licenses for illegals is not a winning issue in general and specifically, the states of Oklahoma and Arizona have passed laws that puts more pressure on illegals, inducing many to leave those states.
But, the future beckons to open borders aficionados. The more foreign born Hispanics that they get to become citizens, the more likely that they will get their way. So, all this means that the window to fix this problem is closing bit-by-bit everyday and, in the near future, it will become impossible to reverse the damage to our nation.
Russia tells US to tear down its Apartheid Border Wall
(Photo: San Diego border wall by Jay Johnson-Castro)
PRAVDA, Russia:
"After the trillions of dollars wasted in slaughtering hundreds of thousands of people around the globe, after failing in each and every one of his domestic and international policies, after insulting the noble precepts on which his country was built and after ensuring that he is the last Republican President for many years to come, George Bush prepares one last parting shot: a US-style Berlin Wall.
After two terms in office, it has become patently clear that George Bush neither respects international law, nor has any intention of pretending to abide by the fundamental precepts underlying international relations, having breached the Geneva Conventions, the UN Charter and numerous UN Resolutions in wanton acts of mass murder outside the borders of the United States of America."
As US Votes on Who Will Hold the Trigger, Mayans Propagate Civilization.
Today, as Americans decide who will get the power to kill or spare millions (see posting of Wednesday, December 05, 2007, "It Takes [Out] a Village: Illegitimate American Power"), a group of Guatemalan Mayan campesinos are in Madrid, on a civilizing mission.
They are here to testify about the US-sponsored Guatemalan officers who, in the '70s and '80s, murdered their families, and came out on top as rich men, drug dealers, US embassy consultants, and Harvard fellows.
It's not as if you can bring back the dead wives, missing kids, or shot-in-the cerebrum husbands, or even sufficiently punish the guilty, who now grin in elegant Zona Cinco pools and in MacLean, Virginia homes with lawns. They still twirl power and walk around, uncuffed, in polite society.
But you can, as one of the mountain corn farmers observed yesterday, "Capture them, imprison them. That's sufficient," which is generous of him, since they butchered his dear ones, friends, and animals, and burnt his gut till his intestines spilled out -- and it is to the great credit of Spain's judiciary that they are willing to let him try.
This is a case of torture, state terrorism, and genocide -- and international arrest warrants have been issued -- but the big, tough Generals who once could answer the question (posed by the conservative Guatemalan daily, El Grafico, [May 17, 1982]) "How is it possible to behead an 8- or 9-year-old child? How is it possible for a human adult to murder in cold blood a baby of less than a year and a half?" are now afraid to fly to Madrid and face the parents of the kids they consumed while pocketing cash from Langley. (Grafico referred to the massacre of Semeja II, Chichicastenango, but, in all, according to army records, 662 villages were destroyed, and perhaps 120,000 civilians were murdered in a place the population of New York City).
They're afraid because there's been something like a tear in the fabric of the political universe and, somehow, as in one of those anomalies of quantum physics, there has emerged -- in this world -- a stray particle of civilization: a legal forum perhaps willing to enforce the murder laws, even against high officials.
Not yet too high, mind you. There are not yet American names on the defendants list. But as we say in the sports which American guys love, its not over till its over.
The case is in Spain's Audiencia Nacional (National Court), which, operating on the principle 'We're all people here,' is exercising its right under international law to try atrocity cases involving non-Spaniards.
(Mayan survivors of things like crucifixion by hanging -- from the big log cross at Rio Negro -- will be testifying. I'll be testifying as well, on the army, the massacre policy, and the US. Lawyers and professionals advancing the case come from CJA [US], APDHE [Spain], RMTF [Guatemala], CALDH [Guatemala], Hastings Law School [US], Impunity Watch [The Netherlands], and the National Security Archive [US].)
Imagine if that precedent caught on. Today's US primary might be awkward, as candidates and advisers dodged the cops, were pressed to sign pledges to stop murdering, and were asked by the press to explain their own pasts -- vis a vis killing civilians, not trivia -- and to explain their bipartisan ideological softness on official crime.
In this particular US-killing matter, one of dozens from around the world, the Republicans' patron saint is Ronald Reagan, so beloved by the Guatemalan leaders who slaughtered the Mayans (and others) that they hung ten-foot portraits of him in their homes as he sent them CIA men, surveillance equipment, covert money and -- most importantly -- open political blessings. The US Democrats' dove is Barack Obama, whose chief foreign adviser, Zbigniew Brzezinski, greenlighted Israel to deliver the actual killing rifles (Galils) to Guatemala, since his President -- Carter -- was a little embarrassed.
Is that the difference between the two big US parties on mass murder -- embarrassment versus pride? Maybe.
We shouldn't have to wrestle with such fine -- though, sometimes, bitterly consequential -- distinctions.
We should be able to vote effectively against, and prosecute, murder.
Maybe US politics needs a civilizing Mayan invasion.
(For background, and re. the US role see Jesus Tecu Osorio, "Memoria de las Masacres de Rio Negro," Guatemala, 2006, and my "The Guns of Guatemala: The Merciless Mission of Rios Montt's Army," The New Republic, April 11, 1983, "Guatemala Can't Take 2 Roads," The New York Times, op ed, July 20, 1982, "Choices on Guatemala," The New York Times, op ed, April 4, 1983, "Despite Ban, U.S. Captain Trains Guatemalan Military," The Washington Post, October 21, 1982, "The Guatemala Connection," The Progressive, May, 1986," "C.I.A. Death Squad," The Nation [US], April 17, 1995, "The Country Team," The Nation [US], June 5, 1995, letter exchange with US Ambassador Stroock, The Nation [US], May 29, 1995, and Allan Nairn and Jean-Marie Simon, "Bureaucracy of Death," The New Republic, June 30, 1986, and Jean-Marie Simon, "Guatemala," W.W. Norton, New York, 1987).
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Obama Wins Delaware
The only state that’s also a kick-ass Promise Ring song.
Exxon's Profits: Measuring a Record Windfall
Exxon Mobil's staggering $40.6 billion earnings for 2007 drive the truth home: There's no business on the planet that gushes forth more profit than selling oil—nothing even close.
But just because it's more money than any other corporation has ever made in history, is it a windfall?
Some, notably the oil companies themselves, spurn the implication that the astronomical earnings are an instance of good market fortune that has blown their way. They don't like the term windfall, especially since it is so frequently followed by an even more despised term, tax. So don't be surprised if you hear a lot of talk about how oil profitability is not out of line with that of other industries. What's the real story when it comes to Big Oil profits?
Let's talk records. Exxon beat its own one-year-old record for the biggest corporate profits ever by 3 percent. Put together with the announcement by the No. 2 U.S. oil company, Chevron, of an $18.7 billion year, up 9 percent over 2006, plus the earlier results of Shell and ConocoPhillips, and that's more than $100 billion in profits from four companies. It's all thanks to the historic 35 percent climb in worldwide crude oil prices in the second half of 2007, ending the first week of this year when oil briefly touched $100 per barrel.
Exxon nation. If Exxon Mobil were a country, its 2007 profit would exceed the gross domestic product of nearly two thirds of the 183 nations in the World Bank's economic rankings. It would be right in there behind the likes of Angola and Qatar—two oil-producing nations, incidentally, where Exxon has major operations.
Ahead of the pack. Exxon Mobil's profits are 80 percent higher than those of General Electric, which used to be the largest U.S. company by market capitalization before Exxon left it in the dust in 2005. The new economy? Microsoft earns about a third as much money. And next to Exxon, the world's largest retailer, Wal-Mart, looks like a quaint boutique, with annual profits of about $11 billion.
On the margin. The oil industry urges people to look beyond its profits to its profit margin: about 7.6 percent of revenues late last year. That's not much higher than the 5.8 percent profit margin for all U.S. manufacturing, and if you exclude the financially troubled auto industry from that analysis, the oil industry actually appears less profitable than most manufacturers, which were earning 9.2 cents on every dollar of sales.
But unrivaled returns on equity. However, profit margins across industries vary greatly based not on how well each business is doing but how capital- or labor-intensive it is. Oil is among the most capital-intensive. But look at the oil industry's profits compared with shareholder equity it has available for investment. The U.S. Energy Information Administration's most recent analysis of the oil industry's performance, released just last month, showed oil industry return on equity of 27 percent—about 10 points higher than that of other manufacturers. And it has been higher throughout this recent era of high world oil prices, just as it was back during the oil shock that hit in 1980.
Enough windfall to tax? That year was the last time a windfall profits tax was enacted, and there's no question that the oil industry's results will focus political attention on the idea again, especially with economic concerns at the forefront and the expensive challenge of addressing climate change on the horizon. (Hillary Clinton talks windfall profits tax; Barack Obama says repeal the tax breaks oil already enjoys.)
The Congressional Research Service found the last oil windfall tax generated only $80 billion in revenue before it was repealed in 1988, far less than the $393 billion projected. That may have been, of course, because of numerous loopholes in the way Congress wrote, and then later amended, the law. Domestic oil production fell and foreign oil dependence grew during the windfall tax years, but—given the hard reality that the United States doesn't have as much oil as the Middle East—those trends have continued unabated since then without any help of a windfall profits tax. That's why new ideas are floating for structuring a tax, such as exempting investments that the oil industry makes in non-fossil-fuel alternatives.
For now, there's simply no alternative that replaces more than a sip of the world's voracious demand for petroleum. And as long as that is the case, the companies that provide it will be pumping out profits.
Interest Rates, Congress, and Your Mortgage
What changing rate conditions and the proposed stimulus plans mean for homeowners
The Fed cuts rates, yet mortgages appear more expensive, and Congress is set to take wide-ranging action to prop up the economy: What's a borrower to make of all this flux? Here are some answers.
Does the latest half-point interest rate cut by the Federal Reserve make it easier to get a good deal on a mortgage? Will it make the mortgage I already have cheaper?
A decrease in the federal funds target rate generally makes it cheaper for banks to borrow money from each other on a short-term basis. But mortgages are based on longer-term interest rates, which are also influenced by expectations about the economy and inflation. Rates can rise, as they did last week, when investors react to news, such as the Fed cut, and expect it to strengthen the economy or spur inflation, explains Doug Duncan, chief economist at the Mortgage Bankers Association. According to MBA's weekly survey, the average interest rates for 30- and 15-year fixed mortgages increased about a tenth of a percentage point over the past week, to 5.6 percent and 5.04 percent, respectively.
For many homeowners already paying off a mortgage, the Fed's actions may be irrelevant, because they are locked into a fixed interest rate. However, if that locked rate is higher than current ones, it may make sense to consider re-financing. Adjustable-rate mortgages are sometimes tied to banks' prime lending rates, which tend to follow the federal funds target rate but are more frequently pegged to other short-term interest rate indexes, so the impact of the Fed cut will vary. "That's why we tell consumers to shop around," Duncan says.
Would the proposed stimulus packages help me with my mortgage payments?
The stimulus package developed by House leaders and Congress contains a provision that would raise the limits on home loans backed by Fannie Mae and Freddie Mac to $625,000 from $417,000. That won't make much difference to current mortgage holders, but for those looking to buy homes that require such large mortgages—not uncommon in pricey areas such as Los Angeles and New York—it would probably help them get better interest rates because Freddie and Fannie will back them, reducing risk for the banks that issue them. And taxpayers can, of course, devote the rebate check they may receive—$600 or $500 per individual taxpayer in House and Senate proposals, respectively—to their mortgages.
I still can't afford to make my monthly payments—what else is the government doing to help me?
The Senate Banking Committee is considering the idea of creating a corporation that would buy loans nearing delinquency at a discount and then allow homeowners to refinance them at more affordable levels. While the corporation would require money to get started, the committee says that it would not be costly over the long term because homeowners would pay back the value of the loan at its new price, and banks would be willing to sell the loans for a discounted price to avoid losing the entire value due to default.
Banking consultant Bert Ely says that while this move would come too late to help some struggling homeowners, it could help those on the margin of keeping their homes, as well as preserve neighborhoods if the corporation maintains and rents out foreclosed properties. "It helps with the neighborhood, and that's where a lot of the problem lies," Ely says.
The mortgage industry has also launched programs to assist at-risk homeowners. Hope Now, a private-sector alliance organized by the Bush administration in December, helps homeowners refinance their mortgages to make them more affordable, among other forms of assistance. Lenders are also working individually with struggling borrowers. According to the Mortgage Bankers Association, almost a quarter of a million borrowers modified their loans or repayment plans in the third quarter of 2007.
One obstacle to helping distressed homeowners has been reaching them, Ely says. "One of the biggest problems is getting people to talk.... It's like someone with a serious illness who's afraid to go to the doctor." For those in trouble, contacting lenders directly is usually the first step—they don't want their borrowers to foreclose, either.
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