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4 Reasons the Housing Bubble May Pop in 2014

In Top This on December 30, 2013 at 10:07 pm

by Rick Aristotle Munarrizby Dec 30th 2013 11:00AM

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The housing rebound is on a roll. Home prices continue to inch higher, and the number of indicators showing economic improvement suggest we’ll enjoy an even rosier 2014, when the Fed won’t have to do quite as much to keep the good times going.

However, there are also more than a few hints that in the year ahead, the housing market’s rebound may take a breather — or we may experience something far worse. Let’s take a look at some of the warning signs.

1. Mortgage Rates Are Moving Higher

The economy’s gradually getting on track, and that has resulted in interest rates inching higher. Naturally, the higher the rate, the less bang potential homebuyers get for their bucks.

There’s little reason to expect this trend to reverse. The Fed recently announced that it’s ready to begin tapering its rate-suppression plan by reducing its bond purchases by $10 billion a month. Easing up on this latest round of quantitative easing — QE3 — will have an impact on interest rates. After all, if the Fed’s $85 billion in monthly bond purchases created the illusion of demand, what will the reduction do to the real demand?

In other words, interest rates for a range of investments are likely to continue inching higher in the year ahead. There’s a reason why savvy investors have been pouring money out of bond mutual funds in recent months as higher rates result in lower bond prices.

2. It’s No Longer House-Hunting Season

The National Association of Realtors has reported three consecutive months of declines in existing home sales.

Housing bulls will argue that the market is still strong. The association representing real estate professionals still expects 5.1 million homes to be ultimately sold in 2013, and that’s the highest tally since 2007. Is that worth bragging about? Is it merely a coincidence that 2007 was when the last housing bubble popped?

Either way, the last several months have not been kind, and that’s enough to kill any of the favorable momentum the market experienced earlier in the year when rates were bottoming out.

3. The Mortgage Market is Starting to Dry Up

With homes getting more expensive and interest rates getting higher, you might expect interest in buying to dry up, and that’s exactly what’s been happening.

Weekly home mortgage applications have fallen to their lowest level since late 2000. The spike in rates has killed off refinancing applications, but loans for home purchases are also starting to slump according to the Mortgage Bankers Association.

That certainly isn’t a good sign for a housing market where a rebound in prices needs a fluid mortgage market to keep sales coming at a reasonable pace.

4. Home Builders Are Getting Greedy

All of these factors would seem to be warning signs for developers, but they don’t seem to be heeding the cautionary signals. Housing starts are soaring as U.S. home builders broke ground on new homes last month at the quickest pace in five years.

It’s easy to see why the builders are getting more aggressive given the rising home prices, but who is going to pay for these new digs in 2014?

In its latest quarter, luxury home builder Toll Brothers (TOL) reported that the average price of its new homes clocked in at $703,000, a whopping 21 percent ahead of what it was charging a year earlier. However, there’s a “Toll” to be paid for this sort of behavior in the market. Orders for new Toll Brothers homes fell by 10 percent during the quarter.

Toll isn’t the only developer experiencing a slide in orders. So what will happen after all of the new construction that’s underway hits the market next year?

The housing market bubble may not pop in 2014, but it’s highly likely that it will lose some of its sudsy essence.

Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our newsletter services free for 30 days.

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Root for the Postal Service to survive

In Top This on December 29, 2013 at 4:43 pm

By Bob Greene, CNN Contributor

updated 9:08 AM EST, Sun December 29, 2013

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Editor’s note: CNN Contributor Bob Greene is a best-selling author whose 25 books include “Late Edition: A Love Story”; “When We Get to Surf City: A Journey Through America in Pursuit of Rock and Roll, Friendship, and Dreams”; and “Once Upon a Town: The Miracle of the North Platte Canteen.”

(CNN) — You wonder what a visitor from outer space — or a visitor from the future — would make of it.

It’s a scene we take for granted — six days a week, it has been a routine part of life in every city, town and village in the United States.

Bob Greene
Bob Greene

A man or a woman, carrying a satchel, walks from house to house, from apartment building to apartment building. No one has summoned the person with the satchel; he or she is expected to show up each day without being asked.

It’s the postal carrier. And because the presence of the postal carrier has for so long been such a familiar sight, perhaps only that visitor from outer space or from the future would be startled by what he was observing:

The sight of other people also outdoors, all over town, communicating instantly with each other at the touch of a button, smiling and looking down at the little screens in their palms — grinning at the through-the-air responses they’re receiving from friends, tapping at the screens to reply anew. Words flying from person to person, nonstop, on the go.

As, meanwhile, on those same sidewalks, the men and women with the satchels weave their way through the people with the screens, on their appointed rounds to deliver words by hand.

The visitor from space, or from a future century, might think this scene — mailbag luggers walking amid screen tappers — is like witnessing ox carts amid hovercraft.

As might an efficiency expert, or a business consultant.

Which summarizes the continuing headache faced by officials in charge of the United States Postal Service. The price of a first-class stamp is going up again in the new year: On January 26, it will increase by three cents, to 49 cents per letter. Federal regulators last week approved the rise on an allegedly temporary basis — the higher rate is supposed to last for no more than two years — but no one really expects it to go back down.

The Postal Service reports that it lost $5 billion in the last fiscal year — and this is being presented as good news. The year before, it lost almost $16 billion. But there are fewer and fewer envelopes in those satchels, so each stamp will come with a higher price tag; the billions of dollars the Postal Service is required to pay each year to pre-fund health care for future retirees is a burden heavier than anything that would fit into a mail sack.

Yet there are reasons to hope that the Postal Service finds a way to stay around for a very long time.

The Postal Service, like UPS, FedEx and other private delivery companies, is a stand-alone business. It is expected to sustain itself; it does not depend on tax money.

But, unlike UPS and FedEx, the Postal Service must go to Congress to get explicit approval for the rates it charges, and for many of the rules under which it operates. This is why it costs the same amount to send a letter across the country as it does to send a letter to the next town. This is why mail service is universal — why those carriers are required to show up each day at virtually every address in the United States.

Forty-nine cents may seem like a lot to mail a first-class letter. But if the Postal Service were to collapse under financial pressures and competition from digital means of communication — if the Postal Service had to throw in the towel — do you really think that UPS or FedEx or some other courier service would take your envelope across the country for 49 cents?

Over the Christmas holiday, the failures by UPS and FedEx to get packages to some customers on time were prominent in the news. As efficient as UPS and FedEx usually are, the existence and ubiquity of the Postal Service has a lot to do with what keeps them on their toes. Their business model is: We cost more than the Postal Service, but because of that you can count on us to be reliable and accountable to you. If the Postal Service were to go away — if that check on the other carriers, that extra impetus for them to excel, were to be removed — what would the impact be on customers and businesses? Could or would the other carriers pick up the slack, at a price that didn’t dismay people?

One hopeful sign for the Postal Service has come from an unlikely source: Jeff Bezos, the founder of Amazon. Amazon has announced that it will be delivering its packages on Sundays — and that to deliver those packages it has arranged to use employees of the Postal Service. The Postal Service has said that it is glad to have the business. It without question can use the revenue.

Can daily delivery of mail continue forever in a digital world? It’s difficult to imagine how. In Canada, the postal service has informed citizens that, over the next five years, it will stop all door-to-door delivery of letters and concentrate on delivering packages. Most Canadians are already asked to pick up letters at community mailbox clusters in neighborhoods or apartment buildings; soon, everyone will. It’s the future.

Universal, inexpensive mail delivery in the United States has been one of the miracles of the nation’s long story; if someone were assigned to build a system like it from scratch today — carriers reporting to every U.S. address, six days a week, to drop off mail and see if there is any mail to go out, all for pocket change — that person would have to concede: It can’t be done.

But it was done, and, for now, it’s still here. For those who, in the digital era, casually say that they’d be just as happy if the Postal Service were to simply disappear:

Be careful what you wish for.

Heroes of the Marathon Bombing Named Bostonians of the Year

In Top This on December 22, 2013 at 12:46 pm

By K.C. Blumm

12/21/2013 at 05:45 PM EST
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When so many were fearfully running away from the site of the Boston Marathon bombings, these people ran towards it to help the injured.

That’s why Natalie Stavas, Dan Marshall and Larry Hittinger have been named The Boston Globe Magazine’s 2013 Bostonians of the Year.

“They demonstrated bravery beyond measure, putting their lives in danger to help save the lives of strangers,” says Suzanne Althoff, the magazine’s editor.

High school custodian Marshall, 33, was waiting for a friend at the finish line on Apr. 15 and suffered a concussion during the second explosion. He was pulled to safety but ran back to help those who were injured, including Martin Richard, the 8-year-old who was one of three people killed in the attack.

Stavras, a pediatric resident, was competing in her fourth Boston Marathon and jumped over a barricade to get to the finish line. The 32-year-old refused to leave the area, despite being told to do so, and helped to reassure and aid some of the more than 200 victims and usher them to ambulances.

Hittinger, 57, was having a drink at the Atlantic Fish Company when the first bomb went off and rushed to assist an 11-year-old, finding a first responder and helping to carry the boy to an ambulance. The ironworker and grandfather was calm amid the chaos, and despite his only emergency training being some first aid courses taken almost 40 years ago, he helped several of the wounded to ambulances.

“Their courageous acts embody the strength of this city in the wake of this tragic event,” Althoff says.

Their stories will be featured in a special 10th anniversary edition of The Boston Globe Magazine, out Dec. 22.

Applying For Multiple Positions At One Company: Smart Or Set Up For Failure?

In Top This on November 11, 2013 at 4:47 pm

Oct 22, 2013 By Rashida Maples, Esq

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Looking for a job is a job in and of itself. I do not know many people who actually enjoy the process of applying for multiple positions, only to be turned down or not receive a response altogether. Couple this angst with the state of the economy the past couple of years and you have many people applying for as many jobs as possible.

Must Read: 5 Ways To Succeed At Work & Still Be The Cool Mom

Sometimes out of frustration, but most times out of desperation, numerous job candidates have applied for more than one or two positions with the same company. Is this strategy of going for everything you can smart or a set up for failure? Here are the top three pros and cons of applying for numerous positions within the same company.

Pros:

1) You in fact may be qualified for each position that is posted so why not go for it? Just because you are qualified for one position should not negate the possibilities of being an asset for another position. You may increase your odds of being called back by applying for more than one position.

2) Applying for more than one position may positively display your persistence. If you applied for one position and did not receive an interview, applying for another one which you qualify for within the same company has been noted by some HR executives as sign of persistence and desire on the part of the candidate.

3) In larger companies, there may be two different hiring managers for the different positions. While one HR manager may feel you are not a fit, the other may be interested in what you can offer.

Cons:

1) Rushing. Each resume and cover letter should be specifically drafted for the position you are applying for. It has been noted that some candidates disperse multiple applications and resumes in such a rushed manner that they fail to specifically highlight their qualifications for each individual position.

2) Coming off as desperate. Some HR managers sense the desperation of an applicant by their unappealing cover letter and lack of necessary qualifications. It is easy to spot the candidate who is just “going for it” as opposed to the candidate who is perfect for the job.

3) You may start a bidding war within the company. Companies do not want friction between their departments. It has been suggested that you focus on one position and I it turns out to not be a good fit, speak with your HR department about moving into another one.

Rashida Maples, Esq. is Founder and Managing Partner of J. Maples & Associates (www.jmaplesandassociates.com). She has practiced Entertainment, Real Estate and Small Business Law for 9 years, handling both transactional and litigation matters. Her clients include R&B Artists Bilal and Olivia, NFL Superstar Ray Lewis, Fashion Powerhouse Harlem’s Fashion Row and Hirschfeld Properties, LLC.

Colleges May Penalize Students Over Preference on Financial Aid Applications

In Money and Finance, Top This on November 11, 2013 at 4:39 pm

by Reuters Nov 11th 2013 7:18AM

By Liz Weston

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LOS ANGELES — College applications aren’t fraught enough, so here’s something else to worry you. The order in which you list your preferred colleges on federal financial aid applications could be used against you.

Colleges are keenly interested in what’s known as “FAFSA position” — the order in which high school students list their prospective institutions on the Free Application for Federal Student Aid (FAFSA). Students can list up to 10 schools to receive their financial aid information, and the ones they list first strongly predict which enrollment offers they’re likely to accept, college consultants say.

The Department of Education releases each student’s line-up to all of his or her prospective colleges. That allows the institutions to see how they rank with students and exactly which schools they are competing against.

Most applicants don’t realize this information is shared, and they have no idea their lists could be used to affect their admissions offers or their financial aid packages, said David Hawkins, director of public policy and research for the National Association for College Admission Counseling in Arlington, Virginia.

“The idea that what students may be offered could be significantly altered by the use of the FAFSA position is highly problematic,” Hawkins said.

A recent Inside Higher Ed article detailed some of the ways that information can be used against students. A university concerned about its “yield” — a closely-watched measure that tracks how many accepted students actually enroll — may not extend an admission offer if the university is near the bottom of an otherwise qualified student’s list, for fear the offer will be rejected.

A college at the top of a student’s list, on the other hand, may not feel compelled to offer generous financial aid, since the student is seen as likely to accept without it.

Colleges don’t admit to these tactics publicly, but consultants who advise families on college selection say it’s an open secret that they occur.

“All colleges have the goal of admitting the best students they possibly can at the best price they possibly can,” said Deborah Fox of Fox College Funding in San Diego, which advises affluent families on ways to reduce their college bills. “I strongly believe that FAFSA position … is just one of the tools they use.”

College officials and consultants who advise them insist that such practices aren’t widespread. Schools are far more likely to use FAFSA position to size up their competition and to predict enrollment, they say. But even the defenders acknowledged other ways in which FAFSA position could negatively affect prospective students.

Withholding Offers

Several of those I interviewed were skeptical that colleges would routinely use FAFSA position to withhold an admissions offer, since FAFSA data is generally transmitted to schools in February and March — late in the admissions process.

“The information is not available at the time it would be particularly useful,” said W. Ken Barnds, vice president of enrollment at Augustana College in Rock Island, Ill., who wrote about FAFSA position as part of a recent Huffington Post article about “big data” and college admissions. “And it would be completely inappropriate to use this information in the admissions decision-making process.”

Hawkins, who agreed an outright denial was unlikely, said his college admissions sources have told him that FAFSA position can be used along with other indications of student interest — such as a campus visit or a consultation with a school representative at a college fair — to put students on a waitlist rather offering admission “to see if they’re still interested.”

Colleges with limited resources for recruiting students may not try as hard to persuade students to enroll who don’t rank them highly, said Galen Graber, an associate vice president for financial aid services at enrollment management consultant Noel-Levitz of Coralville, Iowa.

“If I’m 10th on someone’s list, should I call that person and try to persuade them to move us nine positions ahead,” Galen asked, “or should I call that person that has us in the second position instead?”

Noel-Levitz is among the consultants who have convinced colleges to pay attention to FAFSA position. A college listed first by a student will have its offer of admission accepted 64 percent of the time, according to the consultant’s study of 153 private and public colleges. The acceptance rate drops to 22 percent for colleges listed second and 16 percent for those listed third, Graber said.

Augustana College, a Noel-Levitz client, uses FAFSA position to help prioritize its offers of financial aid, Barnds said.

“I want to get [highly interested students] a financial aid offer as quickly as possible,” Barnds said, “so we don’t leave a student who’s listed us as No. 1 waiting forever.”

Expressions of student interest also are used by some colleges to craft financial aid packages, especially those involving “merit aid” that doesn’t require demonstrated need, Hawkins said. Eager-to-attend students may not receive the same generosity as those on the fence.

“The fact that colleges are differentiating between students on anything other than income very much implies … these packages are based on student interest, among other things,” Hawkins said.

Fox, who advises families on the often-complex strategies of “strategically” listing colleges on the FAFSA, is among those who wish the Department of Education would simply stop sharing FAFSA positions with schools.

“I think this is private information,” Fox said. “It should be kept private.”

The world’s most powerful people according to Forbes

In Top This on October 30, 2013 at 5:54 pm

CNN Newsroom

Michael Noer of Forbes magazine tells Brooke Baldwin about their list of the world’s most powerful people. A president is in the top spot, but he is not the President of the United States.

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When The Checks Food Stamps Stop Coming In: Ohio To Cut Aid For Able-Bodied Adults Without Kids

In Top This on September 7, 2013 at 4:22 pm

Bossip

No more free Randy!

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‘Defined Lines’ Is The Robin Thicke ‘Blurred Lines’ Parody That Trumps All Others

In Top This on September 5, 2013 at 7:21 pm

The Huffington Post | By Emma Gray Posted: 09/03/2013 3:09 pm EDT | Updated: 09/05/2013 4:22 pm EDT

Robin Thicke’s “Blurred Lines” may have been unofficially declared one of the songs of the summer, but we’re happy to end the season with this amazing parody of the decidedly sexist hit.

In response to the criticism surrounding “Blurred Lines,” an Auckland University student group, the Law Revue Girls, created “Defined Lines.” The parody reverses the original video’s gender roles in an attempt to “define those supposedly ‘blurred lines'” and declares: “What you see on TV / Doesn’t speak equality / It’s straight up misogyny.” We could not love it more.

“The message really is just that we think that women should be treated equally, and as part of that, we’re trying to address the culture of objectifying women in music videos,” Olivia Lubbock, one of the women featured in the video, told the AAP.

The Independent reported that “Defined Lines” was removed from YouTube briefly on Monday after being flagged for “inappropriate” sexual content, but has since been restored. Lubbock called the video’s removal a “massive double standard,” since the models in Thicke’s original video are arguably far more sexualized.

“It’s just funny that the response has been so negative when you flip it around and objectify males,” Lubbock told the AAP.

We’re glad YouTube put “Defined Lines” back up. This is one music video the masses should see.

Published on Aug 30, 2013

The Law Revue girls want to define those supposedly “blurred lines”. Enjoy our parody of Blurred Lines by Robin Thicke. Lyrics below. Follow and support us at https://twitter.com/LawRevueGirls.

Can We Move Past the Miley Mess?

In Celebrity Life, Top This on August 28, 2013 at 8:14 pm

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Oh what a Sunday it was!! Who knew that Miley Cyrus could disappoint and shock not only her fans, her peers, and the media, all at the same time? Not only that, but did it in an over the top, outlandish, and totally trashy way. A few days have gone by now and I think the social media universe is moving past it slowly, but before we try to forget that this ever happened I must say, Miley is definitely not role model status for young girls and I am sure she has lost brownie points with some parents over this too.

How was this considered to be a performance or entertainment? Did someone forget to tell Miley that children would be watching the show? And what is it with the teddy bears? They should have posted a warning that teddy bears will be used, but not for their usual intended purpose. I don’t think much imagination went into choreographing her performance… and all that can be said about that is, what the ????? And to put Robin Thicke in the middle of that nonsense, I hope that never ever happens again.

One last thing, Miley’s dad didn’t see anything wrong with her antics, he praised her dancing and prancing, but what else would we expect. You know the old saying, daddy’s little girl, the apple of his eye and can do no wrong. The problem is she did everything wrong.

Box office report: ‘The Butler’ repeats at No. 1, ‘Mortal Instruments’ flops

In Top This on August 25, 2013 at 1:31 pm
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