Spain's Budget Deficit Already Exceeds Maximum for Entire Year; Path of Convergence

Spanish unemployment rate is 25% and rising. Youth unemployment is 52.9% and rising. Meanwhile Spanish budget deficits are such that Spain will need more austerity. I keep wondering what it will take for this setup to blow sky high in riots.

Via Google Translate from Libre Mercado central government deficit already exceeds the maximum provided for the year

The central government posted a deficit of EUR 48,517,000 through July in terms of national accounts, the 4.62% of GDP, representing an increase of 25.8% compared to last year, according to data provided by the Secretary of State Budgets, Marta Fernandez Currás. The deficit figure exceeds the new limit has assumed the state, which has risen to a point, to 4.5%, for the extra year he gave Brussels to Spain to reduce the deficit to 3%.

The deficit through July was a result of payments stood at 100.694 million euros, up 9.8%, while revenues totaled 52.177 million euros, representing a fall of 1.8%. On a comparable basis, net of transfers to regional governments and social security, among other authorities, the deficit stood at 4.12% of GDP.

Humorous Comment of the Day

"We are on the path of convergence required by Brussels," said Currrás, recalling that the deficit is an annual target, so the balance recorded until July continues to be a reference.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

China, Germany to Settle More Trade in Yuan, Euros; What's That Mean for Gold, the Dollar?

Inquiring minds note China, Germany Plan to Settle More Trade in Yuan, Euros.

Germany and China plan to conduct an increasing amount of their trade in euros and yuan, the two nations said in a joint statement after talks between Chancellor Angela Merkel and Chinese Premier Wen Jiabao in Beijing on Thursday.

"Both sides intend to support financial institutions and companies of both countries in the use of the renminbi and euro in bilateral trade and investments," said the text of the statement.

It also said that both parties welcomed investments in China's interbank bond market by German banks and supported the settlement of business in the yuan by German and Chinese banks and the issuance of yuan-denominated financial products in Germany.

Announcement Mean Anything?

That's the announcement, and I have no doubt people who do not understand trade math will trump this up as if it's news of big significance.

Well, it's not. The announcement is a common sense function of math.

There is more bilateral trade between Germany and China, so fundamentally it makes sense that this agreement would be worked out. Indeed, mathematically, the markets would eventually force such an agreement.

If Germany goes back to the Deutschmark, then one should expect bilateral trade between the countries to be in Deutschmarks and Yuan.

The only relevance to the dollar is if Germany is taking away US trade with China. If not, the announcement is a meaningless function of math.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

July Update

The July figures from the apartment complex look good. Overall, they've dropped a bit from June, but not significantly. June was the sixth consecutive month of increasing total income, so I expected that to end sooner or later. Total income for July dropped by $4,000 and occupancy dipped to 90%. Offsetting the lower income were lower payroll and utility payments, so we had a net gain in monthly profit. However, the property overall was above break-even, which is a first for this year and, if I recall, the first for maybe 1 or 2 years. Good news indeed.

My four hard money loans continue to pay on time. Several other loans my partner has have closed recently and I expect some, if not all, of my loans to be closed soon. Three of them aren't approaching their 1 year due date, but based on past experience with the borrower, the properties are probably up for sale or in escrow right now. One of my loans has actually gone the full 1 year term - something that rarely happens. This note was due this month. Haven't heard any word on a payoff yet though.

Read More

Catch Up Friday: LiLo Leaving Los Angeles?

On the heels of famous and famously troubled but essentially homeless "actress" Lindsay Lohan (allegedly) skipping out on a $46,000+ bill at and being banned from* the boho-swank Chateau Marmont in Los Angeles, CA where she shacked up for a good portion of the summer, word comes down the celebrity real estate gossip grapevine that the always-in-some-kinda-legal and/or Showbiz tangle starlet may make a move to Manhattan.

The Confidential canaries at the Daily News reported this morning that the hard-charging bar-hopper is expected to bunk in the TriBeCa apartment of "her assistant/sometimes best friend Gavin Doyle."

Hmm. Doesn't sound like a very permanent solution for the perpetually peripatetic tabloid seller but then again, when has itchy-footed and often-scrambling Miss Lohan ever really stayed put anywhere for more than a few months?

Good luck Big Apple.

*A press release issued by the hotel's general manager says the ban will be lifted and Miss Lohan will be happily received back at the Chateau Marmont at such time she pays her outstanding bill.

Read More

Catch Up Friday: A Decorator Throw Down

Several weeks ago Your Mama regaled the children—or punished the wee lambs, depending on your point of view—with photographs and floor plans of a octagonal triplex penthouse atop the City Spire building in Midtown Manhattan. The uncommonly configured penthouse, according to property records, is owned by real estate developer Steven A. Klar who hoisted it on the open market in late July (2012) with a splish-splashy $100,000,000 price tag guaranteed to generate a mountain of international publicity.

The original online listing for the approximately 8,000 square foot aerie proudly proclaimed the opulent—but, in our mind, ludicrously mundane—interiors had been worked over by internationally renown, Chilean-born interior decorator-designer Juan Pablo Molyneux. Well, dontcha know children, Mister Molyneux was not pleased with that rather grandiose assertion.

Uh-oh.

After receiving a number of not-particularly-positive phone calls "'from all over the world,'" the designer-decorator jumped on his princess phone and called The Old Grey Lady herself—that would be The New York Times—to clarify matters and express a sharp dismay about the existing day-core. He is not, he would like the world to know, responsible for the installation and execution of the finishes and furnishings. He went on to hiss, "'I never thought that this horror would be published and then everybody would blame me for having done it.'"

Oh dear.

Mister Sklar conceded to The New York Times that Mister Molyneux did only design the original plans for the penthouse 18 years ago and that he opted to execute the designs himself without additional assistance or guidance from Mister Molyneux. Mister Sklar showed The New York Times Mister Molyneux's original plans and pointed out that he "hewed almost religiously to the decorator’s plans, down to the style of curtains, use of marble and columns — even, in one case, the exact placement of a painting in his office."

Cat fight! 

As of today, online marketing materials still state the six bedroom and nine bathroom, multi-terraced penthouse was, "Designed by the renowned Juan Pablo Molyneux, a member of Architectural Digest's AD100." More photos and floor plans here.

Mister Molyneux's own, elaborately-done Manhattan townhouse also happens to be available on the open market with a protuberant $48,000,000 asking price and the few listing photographs included with online listings show a more nuanced, richly-textured, and typically Molyneux-ian sort of day-core. 

listing photos: Stribling 

Read More

Brussels Pushes for Another "All Powerful" Banking Committee, Headed by ECB, In Spite of Objections by ECB and Germany

Once nannycrats grab on to an idea, they never relinquish it. Eurobonds are the perfect example.  Many other ideas float around despite numerous objections in key places. Some of these ideas involve creation of more commissions and more working groups.

Here is a sampling of commissions and groups that I am aware of.

• The European Commission is headed by president José Manuel Barroso
• The European Council is headed by president Herman Van Rompuy
• The Euro Group is headed by president Jean-Claude Juncker
• The European parliament president is Martin Schulz
• Numerous other committees set policy on trade, energy, and nearly everything else under the sun.

Barroso now wants another new commission, this one under the ECB with the task of being the "all powerful" banking supervisor.

As envisioned, Barroso's plan would create a 23-member board: a national representative from each eurozone country plus six independent members, including its chair and vice-chair.

No doubt there will be dozens if not hundreds of staff members all intent on expanding their own power.

The Financial Times has more details in Brussels pushes for wide ECB powers

The European Central Bank would be given sweeping authority over all 6,000 eurozone banks under a plan being drawn up by the European Commission, putting Brussels on a collision course with Germany and the ECB itself, which have urged a more decentralised first step towards “banking union”.

The plan, agreed at a meeting this week between top aides to José Manuel Barroso, commission president, and Michel Barnier, the EU’s senior financial regulator, would strip existing national supervisors of almost all authority to shut down or restructure their countries’ failing banks, giving those powers to Frankfurt.

The German government has resisted centralising all supervisory powers with the ECB, however, arguing that Frankfurt should be left to deal with just the eurozone’s 20-25 largest banks. National supervisors would then be left as independent and co-ordinating agencies for smaller banks.

Some senior ECB officials had taken a similar view in closed-door consultations with Brussels, EU officials said, though Mario Draghi, the ECB chief, is more sympathetic to the commission’s view.

Germany’s objections also stem from a desire to keep national control over smaller, politically connected regional savings banks.

Despite the resistance, Mr Barroso this week decided to adopt the more ambitious proposal advocated by the commission’s internal market directorate, drafters of the plan, which argued a narrower approach would disappoint financial markets.

Splitting responsibility could complicate the next steps in creating a banking union: setting up a eurozone-wide deposit guarantee scheme and bank bailout fund. If only large banks were covered by those schemes, depositors could flee smaller banks for more secure larger ones, officials argued.

To become law, all 27 nations must agree. Barroso hopes for a summit before the end of the year.

In addition to unanimous approval for such a position, I would point out that ceding power to Brussels is a change so sweeping that Germany would require a national referendum, just as with the eurobonds idea.

Nannycrats do not care about such issues, they just plow ahead, then blame Germany when it will not go along.

Speaking of which, I highly suspect Merkel has taken a partial stance out of political expediency. Perhaps she thinks she can avoid a referendum by limiting authority to only the largest banks.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

Friday Catch Up: Damon's New Digs

Actor Matt Damon and wife Luciana Barroso have been on a long and as-yet unsuccessful search for a new, super-sized pad in Manhattan for years* but, as the folks at Zillow revealed, they didn't seem to take much time on the west coast where they've dropped a whopping $15,000,000 on a three-story, 8,890 square foot** Zen-contemporary in the upscale Pacific Palisades community.

Previous reports and listing information we managed to dig up out of the depths of the internets show the hulking, KAA Design Group-designed domicile—a blend of California Modernism and traditional Spanish Colonial, according to the architect's website—was built in 2004 and sits on a flat, .68 acre corner lot in the quite-ritzy but none-the-less low-key Riviera section of Pacific Palisades. As it turns out—and maybe not coincidentally—Mister Damon's new digs happen to be on the same street as the plush, gated estate his b.f.f. Ben Affleck shares with wife Jennifer Garner.

The boxy mansion's series of interlocking glass, stone and wood pavilions orbit around a voluminous, cruise ship-like atrium with 35-foot mahogany ceiling and include 7 bedrooms, 10 bathrooms, formal living and dining rooms, an office, eat-in kitchen and family room, media room, five-car garage, and what listing information called a "serious" home gym.

Wide and soaring banks of glass open up to various courtyards, garden, patios, and sleeping porches. The fully landscaped grounds include flat lawns and gardens connected by wood walkways, numerous water features—including, as per the architect's website, "a koi pond that functions as a fence," and a swimming pool and spa with adjacent pool house pavilion.

For the last couple of years Mister and Missus Damon (and their four children) have hunkered down in New York City but have long maintained a sprawling, two-parcel waterfront compound in Miami Beach, FL. The first portion of the property was purchased in April 2005 for $10,300,000 and includes a 9 bedroom and 10 bathroom mansion (plus a waterside guest house and additional living space above the garages), and the second parcel (with roof-terraced, bay-side pool house) was picked up a few months later, in December, for $4,200,000. Not too long ago Your Mama heard an entirely unsubstantiated rumor that Mister and Misssus Damon might like to sell their Miami Beach spread but, sorry Charlies, we can't offer up any additional details at this point .

*As far as Your Mama knows—and we really know so very little—Mister Damon still owns an East Village loft-apartment with a private basketball court in the basement.

**Some resources we consulted show the house may actually be as large as 13,508 square feet. 

listing photos: Coldwell Banker (via Curbed)

Read More

Petworth Safeway Closing September 8th for Multi-family

Safeway officially announced today that it will close its Petworth store on September 8th to make way for the mixed-use development that has been long planned for the site.  The new store, to be developed by Duball, is scheduled to open mid 2014, with a 62,000 s.f. facility that will be the third largest in the city, triple the size of the current store.  Five floors of residential will sit atop the supermarket at 3830 Georgia Ave.  Torti Gallas designed the new building.

Washington D.C. real estate development news

Read More

107-Year-Old Cleveland Park Home Dodges Bullet

A 107-year-old home in Cleveland Park has received a last minute pardon from razing, after the property was sold to a new owner and plans to develop the site for the moment shelved.


"The raze application and the concept proposal have been withdrawn," confirms Steve Callcott, Deputy Preservation Officer at Historic Preservation Review Board (HPRB). "We received notification from their attorney that the property has been sold to a different owner."

The saga of the marginalized home at 3211 Wisconsin Avenue was set to come to an abrupt end, as the last owners had sought permission to raze the house to make way for a six-story apartment building.

Previous developers at Hastings Development had proposed a wholesale relocation of the house, from its Wisconsin Avenue location in Cleveland Park to a vacant lot at 3118 Quebec Place NW.  A 2008 report from Hastings Development described the sad case of a home that had "lost its setting" and was "pressed between multifamily apartment buildings."  Pictures illustrating this point depicted a forlorn two story house dwarfed on each side by looming monoliths and fronted by a hectic thoroughfare.  Encroachment was gradual; to the south, an eight-story apartment building was constructed in 1958, and to the north, a (unsightly) seven-story building went up in the Eighties.  In contrast, 3211 was a modest, two-story frame house, set back from the street with a small front yard.  

But the HPRB rejected this proposal, later saying that the "new location and context was inappropriate for the building," despite the fact that its initial report found the Quebec Place lot "would provide a more visually compatible context of similarly sized and scaled single family houses."  An HPRB report noted that the house was "deteriorating and vacant" and was "in need of substantial repair" as well as missing the original porches. Additionally, there was speculation that the original builder and architect of record, a Treasury Department bookkeeper named Donald Macleod (he built the house for his sister Euphemia), had simply copied the plans for the house out of a builder's manual or pattern book, theoretically reducing the house's value as a historical artifact.

Following the denial of the relocation request, developers changed gears and planned to raze the house and build a six-story apartment building much like the surrounding ones - that is, until the property changed hands at the last minute.  So what's next for the once-endangered house?

"We have no applications pending [regarding 3211 Wisconsin]," says Callcott.  "We're not exactly sure what's going to happen to it."

Washington D.C. real estate development news

Read More

Bad News For Super-Models: Computer-Generated Fashion Models Better Than Real Thing; Fashion Questions of the Day

Here is an easy prediction: Price of fashion models in advertizements is going to collapse, if indeed the industry survives at all.

Why should retailers pay for fashion models when an advertizing department can generate models with the perfect height, weight, breast size, nationality, and complexion for whatever designs they want to promote?

Bad News For Super-Models

MarketWatch describes the setup in 5 computer-generated sales pitches

To save on costs—and perhaps assembly time—Swedish retailing giant IKEA created computer-generated images of its furniture for the new catalog, rather than hiring a photographer. By next year, a quarter of the scenes depicted in IKEA’s print and online advertising will be digitally drawn rather than photographed, The Wall Street Journal reported last week. In fact, IKEA says it is able to better depict its products with computer images than actual photography.

IKEA is not alone. Hollywood filmmakers increasingly create characters—and not just special effects—with CGI animation. And some fashion lines are finding that it’s less expensive to create the perfect specimen digitally than to track down America’s Next Top Model. These computer-generated realities may be cheaper, more appealing, and more versatile than the genuine articles.

Related Ideas

The MarketWatch article also discussed simulated driving of cars, movie special effects, and 3-D dream homes.

Special effects are nothing new. New car models come out only once a year. And I believe most people want real images of homes, not simulated models.

In contrast, clothing changes four times a year, with each season, and also varies by weight, height, size, nationality, skin color, age, etc.

Fashion Questions of the Day

Do I care if the person wearing a sweater in a printed image is generated or real? Why would I? How would I know in the first place?

Supermodels on magazine covers may or may not go away due to importance of name recognition, but every modeling job on down is likely to be eliminated over time.

Virtual models simply have too many advantages for real models to compete effectively. This in turn will pressure wages of even the super-models.

Looking for a career? Fashion modeling is not a good choice.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

The Ground Floor

Yo! Sushi, the British fast food sushi chain, is opening a second location at 675 H St, NW. Construction is slated to begin in early October.

The Four Seasons Hotel in Georgetown will be opening Cafe M, a 635 s.f. pastissieurre and cafe located off the front courtyard, this Fall.  It will be located in the M29 Lifestyle store which re-opened after an expansion in June.

DC Noodles, which closed to make way for Louis at 14th on U Street, is reported to be planning to reopen at 1817 Columbia Rd. in Adams Morgan.

Sherman Golden, a 75 seat restaurant, will open at 1316 9th St, NW.  (POP)

Union Town Bar and Grill, a Cajun style restaurant in Anacostia, closed after the owner has pleaded guilty to two felony drug charges.  (WJLA)

Ambar, a restaurant focusing on Serbian cuisine, will open in Capitol Hill at 523 8th St, SE in November.  (WP)

Numerous changes to alcohol licensing have been proposed under the Omnibus Alcoholic Beverage Regulation Amendment Act of 2012 which, among other changes, would streamline the application process and provide a penalty for holders of liquor licenses not in active use.

Jen Angotti is a DCRE realtor licensed in DC and VA.  She also writes Concrete Jungle DC.

Read More

Morning Real Estate Review

Group files to stop Georgia Avenue Wal-Mart (Washington Business Journal)  Builders are expected to start construction of the site within weeks, but opponents have asked the Board of Zoning Adjustment to reverse the building permits issued earlier this year.

NIH signs 10 year lease in Bethesda (Washington Business Journal) The GSA has signed a lease renewing the NIH's Democracy Plaza lease of 365,000 s.f.

Contracts for commercial construction way up in NOVA (Virginia Business)  Contracts for future construction surrounding DC on a 22% increase over July of 2011.

District picks Akridge-Argos group to develop Stevens School site (Washington Post) Gray's selected team will build a 10-story office building behind the school with ground floor retail.

Read More

Japan Manufacturing PMI Hits 16 Month Low, New Orders Plunge

Markit reports Japan Manufacturing PMI Hits 16 Month Low

Key Points:

Output and new orders down at accelerated rates
Near-stagnation of employment
Purchasing costs fall to greatest extent since November 2009

Markit/JMMA Manufacturing PMI



After adjusting for seasonal factors, the headline Markit/JMMA Purchasing Managers’ Index™ (PMI™) posted 47.7 in August, down from 47.9 one month previously, signalling the sharpest worsening of Japanese manufacturing sector operating conditions since April 2011. Moreover, the latest deterioration in business conditions was broad-based across all three market groups.

Japanese manufacturing production declined further in August, with the rate of contraction accelerating to the fastest in 16 months. The latest reduction in factory output was the third in as many months.

Reflecting falling new orders and corresponding spare capacity, backlogs of work decreased further in August. The rate at which firms depleted work-in-hand (but not yet completed) was sharp, and the steepest since May 2009.

Japan is in its third deflationary decade in spite of massive fiscal stimulus, massive monetary stimulus, and the major industrial world's highest debt-to-GDP ratio.

US demographics are not as bad, but US consumer debt overhang and student loans are worse. The deflationary forces facing Bernanke are massive.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

Reader Questions On Hyperinflation; Would Printing $50 Trillion Tomorrow Do Anything?

In response to Economist Fired for Expressing Opinions on Max Keiser Show; Errors in Observation where I stated "The Fed Cannot Realistically Cause Hyperinflation" I received a couple of emails worth reviewing.

Reader Philip writes ...

I do not understand how you could say that the Fed cannot cause hyperinflation. The government has a huge debt. The debt is manageable at super low rates. But, if rates rise due to some inflation or even just caution from abroad then the government starts paying a very large sum in interest. That takes away from its obligations even more than the current deficit amount. Either the Fed has to step in and monetize the debt by printing more and more money spiraling out of control.

Definition of Terms

As always, before one can have a rational discussion, one must agree on definitions. Hyperinflation is a complete loss of faith in currency. In other words, currency becomes worthless in a short period of time.

Is there a risk of high interest rates? Yes. But I do not think that risk is high in the near future. Even assuming I am wrong, high rates are not the same as hyperinflation.

The US dollar is not headed to zero given the US has the largest stash of gold of any country. That alone would preclude hyperinflation. There are many other reasons that I have touched upon that suggest interest rates are not going up fast.

Credit Markets

The Fed has tried to revive the credit markets but has essentially failed, except for student loans. Making debt slaves out of students is actually a hugely deflationary force.

Moreover and as I have stated many times, the Fed cannot give money away, spend it, or force anyone to spend it. That is a very tough battle for the Fed with attitudes where they are (and as I have mentioned, attitudes are very important).

Banks do not want to lend, credit-worthy businesses do not want to borrow, and consumers are still deleveraging. Those are extremely deflationary forces.

Would Printing $50 Trillion Tomorrow Do Anything?

Ignoring interest on excess reserves (a proviso I mentioned), printing $50 trillion dollars tomorrow might not do anything.

Indeed, if $50 trillion printed tomorrow sat as excess reserves (the most likely event), it would have the same effect as if it was buried in the ground, or not printed at all. Such is the nature of a credit-based economy, and a point that has caused hugely inaccurate inflation forecasts from many Austrian economists.

As previously mentioned, such massive printing might briefly cause a temporary attitude change accompanied by a brief asset bubble of some sort (especially in long-dated treasuries given banks would put some of it to that use).

However, massive printing would collapse treasury rates, further destroying those on fixed income, and make it even harder for pension plans to meet assumptions.

Since printing $2 trillion did not spur credit expansion, pray tell why would $50 trillion?

Theory vs. Practice

Certainly we are guessing as to what printing $50 trillion might do. As a practical matter, the odds of finding out are essentially zero. The Fed is not going to print $50 trillion tomorrow.

More realistically, would printing $2 trillion a year for the next 10 years cause hyperinflation?

No, it won't.

So where is Fed induced hyperinflation going to come from? The answer is it isn't.

Government vs. the Fed

At this stage in the cycle, and in sharp contrast to what most believe, the Fed is essentially powerless (which is exactly why Bernanke is begging Congress to act)

In contrast to a Fed that cannot spend money (except to meet its payroll and expenses and pay interest on reserves, etc), the federal government could actually spend $50 trillion tomorrow. But it won't.

Hyperinflation? Even from a monetary aspect hyperinflation is nowhere in sight.

Hyperinflation is a Political Event, Not a Monetary Event

It's important to note that hyperinflation is not really a monetary event in the first place. Rather, hyperinflation is a political event caused by governments.

I responded that way in an email to reader Peter who replied "Sorry, but your theory is not based on the data. Read the literature on high and hyperinflation episodes."

Well, I have read countless excerpts and Peter is badly mistaken.

Please consider Hyperinflation Nonsense in Multiple Places.

The entire post is worth a look for some remarkably silly predictions, but for the debate at hand, here is the pertinent snip:

Jeff Harding at the Daily Capitalist asks Why Does Hyperinflation Occur?

In every modern case of hyperinflation the decision to inflate was a political one, not an economic one. In almost every case hyperinflation followed a war or a coup or some massive political change such as the end of the Soviet empire or the rise of a dictator or a populist-socialist takeover, and other political unrest.

In the 20th Century there were quite a number of hyperinflationary events. I used the Wikipedia list of modern hyperinflations (Since WWI) and researched the political circumstances of each country. The circumstances can be put into three rough categories: post-war disruption, post-Soviet collapse, and socialist-populist regimes.



For example we all know what happened in Germany during after WWI when politicians, mostly socialists, blamed all their problems on reparations and continued to print so much money that it resulted in the famous cash-in-a-wheelbarrow photos. They literally had no clue what they were doing.

The post-Soviet empire collapse is easier to understand as former communist/socialist regimes fought for power and struggled with economic policy. Many of these countries have reformed or were forced to reform their monetary and fiscal policies.

Many of the socialist-Marxist regimes were Latin American populist governments who employed “revolutionary” anti-capitalist nostrums for economic policy. Chile (Allende) and Argentina are good examples. Argentina has had years of high inflation to hyperinflation since 1980. In Africa most countries were a mixture of strongmen with socialist-Marxist policies. I am not suggesting that these were pure socialist governments, but rather the typical situation where the government seizes or controls large parts of industry and issues regulations controlling much economic activity.

These hyperinflations all had one common denominator: during a period of instability, spending was used as a political tool and it got out of hand. I understand that the circumstances of each country were different and that it is perhaps unfair to say, lump Israel in with Argentina. But each country faced political factors that created instability or a national crisis; the government spent heavily to gain popular support, and resorted to the printing presses to pay for their spending.

Harding is correct. This is how I further elaborated...

Zimbabwe vs. Weimar

In Zimbabwe, the Mugabe government initiated a "land reform" program intended to correct the inequitable land distribution created by colonial rule. Ultimately, Mugabe's attempt to to bail out the poor at the expense of the wealthy is what triggered capital flight and loss of faith of the currency.

His reforms not only caused a flight of capital and human capital (the wealthy), they also led to sanctions by the US and Europe. In response, Mugabe turned on the printing presses but the loss of faith in the currency had already occurred.

In Weimar Germany, printing for war reparations kicked off hyperinflation. Wikipedia provides a good accounting in Inflation in the Weimar Republic.

It is certainly not impossible for there to be a complete loss of faith in the US dollar, however there odds are extremely remote.

Can The Fed Cause Hyperinflation?

I do not think the Fed itself can cause hyperinflation and more importantly I am sure they would not if they could. The reason is "Hyperinflation Would End The Game"

• Hyperinflation by definition would destroy the currency and thus the banks
• Hyperinflation would destroy the wealthy and all their corporate bond holding
• Hyperinflation would destroy the Fed
• Hyperinflation would destroy the wealthy political class

To understand how powerless the Fed is, one needs to understand the difference between credit and money, how much the former dwarfs the latter, and what the Fed's role is in getting banks to lend.

Hyperinflation Model is Complete Silliness

Those calling for hyperinflation are extremely misguided. It is not going to happen in any timeframe worth discussing.

On the political side, no country is going to force war reparations on the US. The US is not going to peg its currency to another, the Fed is not going to print $50 trillion (and it would not matter anyway unless Congress spent that much), government is not going to confiscate land to the point of causing massive human and capital flight, etc. etc.

Moreover, the US's gold holding, the fact the US has the largest capital and bond markets in the world coupled with ease in starting a business vs. nearly anyplace else in the world, absolutely 100% precludes a hyperinflationary outcome for the foreseeable future.

The hyperinflation model is absolute complete silliness.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

Thursday Catch Up: Alan Jackson Lives Large

In case any of y'all didn't already know, veteran country music kingpin Alan Jackson is—as Your Mama likes to say—a serious Real Estate Baller with a rotating property portfolio stuffed to the gills with a hefty handful of high-cost and high-maintenance residences in both Tennessee and coastal Florida.

Two years ago the award-winning country crooner sold Sweetbriar—an epic, 135-acre estate outside Nashville, TN—for around $28,000,000 and the property gossip gals at The Wall Street Journal announced a couple weeks ago he and the missus have now heaved their eye-popping, private peninsula occupying compound on Center Hill Lake near Smithville, TN on the market with a $4,995,000 price tag.

In addition to the 6,100 square foot, five bedroom, multi-story mansion ringed by numerous verandas and terraces and perched on a thickly-treed bluff above the water's edge, the approximately 3.5 acre estate comes complete with a separate four bedroom guest house and a one bedroom cottage perfect for a live-in caretaker.

A detached garage for six or more cars has helipad on the roof and a private dock directly with an elaborate, two-story house bought equipped with indoor and out door lounging areas, couple of water-slides and a raised hot tub on the upper level deck.

Mister and his long-time missus Denise reportedly custom-built the deluxe compound 20 years or so ago and opted to list the vacation property because, according a statement provided to the WSJ, they and their three daughters don't use it as a family much anymore and are "re-evaluating their plans for the future after she [Missus Jackson] beat cancer last year."

Last year Mister and Missus Jackson flipped a Franklin, TN mansion they purchased in June 2010 for $3,675,000 back on the market with a $3,995,000 price tag. The stately, gated estate with its 14,040 square foot mansion and its eight bedrooms and ten terlits in eight full and two half bathroom remains on the open market with a slenderized asking price of $3,750,000. Your Mama, who don't know a hat from a pick-up truck, heard through the grapevine—which means we read it somewhere but don't recall where—the luxury loving country music royals bought the opulent mansion to live in temporarily while they finished construction on a significantly larger mansion nearby.

In September 2010, the big-livin' Jacksons sold a river-front getaway outside Nashville (TN) to fellow country music royal Kenny Chesney for $1,425,000 and in 2009 they acquired a 4.29 acre spread in Franklin (TN) on which now stands the a brand spanking new, custom-built and decidedly baronial 22,136 square foot mansion the Jacksons now, presumably, call home. Just because they're thinning their bulging property portfolio, butter beans, does not mean these country music Jacksons are the least bit interested in downsizing or economizing.

In May of this year (2012) Mister and Missus Jackson took a nearly three-quarter million pounding to their financial pocketbooks when they finally sold a 2,214 square foot Key West-style cottage directly on the Intracoastal Waterway in Tequesta, FL for $725,000. Listing information and property records we squeezed out of the interweb shows the four bedroom and three bathroom property was acquired in June 2004 for $1,270,000, first listed in November 2009 for $1,500,000, and includes a private dock capable of parking two 70-plus foot yachts.

Property records (and The Bizzy Boys at Celebrity Address Aerial) also indicate Mister and Missus Jackson still maintain a second, more substantial 1.1-acre ocean front estate in Jupiter purchased in October 2002 for about $3,500,000. The Martin County Tax Man shows the two-story Mediterranean mansion, built in 2007, measures 8,724 square feet and includes seven bedrooms and 6.5 bathrooms. A private dock on the other side of the road extends deep into the Intracoastal Waterway where Mister and Missus Jackson park their armada of pleasure craft.

See, now? We told y'all he was a Real Estate Baller.

listing photos: French Christianson Patterson and Associates and Christie's International Real Estate

Read More

Thursday Catch Up: Leasing LeBlanc

As first revealed by the ever-industrious folks at Realtor.com, sitcom star Matt LeBlanc—first famous as do-do bird beau-hunk Joey Tribbiani on Friends, then as do-do bird beau-hunk Joey Tribbiani on the blessedly short-lived Joey and now appearing as a version of himself on the very possibly under-appreciated Episodes—has put a plush and expensively restored and updated Spanish-style abode he owns in Pacific Palisades, CA up for lease—for just six to eight months, according to current listing information—with a monthly rent of $12,995.

Let's just call it $13,000, shall we?

Mister LeBlanc purchased the swimming pool-free property in January 2007 for $7,400,000 and current listing information shows the well-maintained, two-story casa sits on a half-plus landscaped acre; was built in 1933; spans a fairly-modest by celeb standards 3,930 square feet; and is finished with beamed ceilings, wood floors, and original fixtures, iron work and tiles.

Three family/guest bedrooms share 3.5 bathrooms and an additional staff room includes an additional, private lavatory. A few of the primary living and entertaining spaces include a step-down living room (with non-working fireplace); paneled dining room and paneled library (also with non-working fireplace); and contemporary, sky-lit center-island kitchen with compact, adjoining family room outfitted with built-in cabinetry, wet bar and non-working fireplace.*

Leasing out his canyon-view crib in Pacific Palisades hardly leaves Mister LeBlanc homeless. Our entirely unscientific research reveals handsomely goofy actor owns property in Los Alamos, CA as well as a pair of adjacent houses in Encino, CA. One of the Encino residences, a 1,966 square foot ranch-style house, has two bedrooms and three bathrooms according to the L.A. County Tax Man and the other, a far more substantial and recently-renovated contemporary mansion, includes a swimming pool and "sunken" tennis court partially cantilevered over the long, gated driveway that curls up to the front of the main mansion and continues around to the front of the smaller ranch house.

*Current listing information states, "Fireplaces not in working condition."

listing photos: Prudential California Realty

Read More

Thursday Catch up: Gomez Snags Hill?

Did Justin Beiber's former Disney star girlfriend Selena Gomez buy comedic actor/producer/screenwriter Jonah Hill's house in Tarzana, CA?

Maybe. Could be.

Property records Your Mama peeked at don't yet reflect a transfer of ownership of the five bedroom, 5.5 bathroom, single-story quasi-Cape Cod/California ranch-style residence young Mister Hill picked up only last September (2011) for $2,175,000 but multiple online reports say he's done flipped his rather matronly-looking house in Tarzana to even younger Miss Gomez.

The .85-acre property was not, as far as we can tell, made available on the open market but at least one report says 20-year old Miss Gomez—who currently lives in an apartment on her parent's substantial Encino estate—paid $2,900,000 for the 4,650 square foot, quintessentially-suburban gated estate that includes a swimming pool, spa, landscaped grounds and a tennis court.

By Your Mama's busy-body, rudimentary calculations, Miss Gomez's new digs are 9.8 miles from her boyfriend's even larger and even more quintessentially-suburban estate in a double-gated private community in Calabasas.

listing photos: Prudential California Realty

Read More

Eurozone Retail Sales Decline 15th Month, Plunge Led by Italy, France; German Sales Contract Slightly

Once again there is grim data from Europe. The safe thing to do is expect grim data every time European data is reported. Except for an occasional outlier, you will not be too far off.

Eurozone Retail Sales Decline 15th Month

Markit Reports Eurozone retail downturn deepens in August

Key points:

• Revenue contraction extends to tenth month
• German sales flat; sharper falls in France and Italy
• Inflationary pressures build up

Retail sales in the Eurozone continued to fall sharply on an annual basis in August. The rate of contraction accelerated to the fastest since May, and extended the current sequence of continuous decline to 15 months. This was despite a further year-on-year increase in Germany, and reflected substantial declines in both France and Italy.





Employment Declines 5th Month

Employment at retailers in the Eurozone declined for the fifth month running in August. The rate of job shedding remained modest, reflecting sustained workforce growth in the German retail sector. French retailers posted the steepest job cuts for over three years, while the rate of contraction in Italy eased since July.

Prices Paid Rise

The Prices Paid Index rose for the third month running from May’s 19-month low in August, signalling a strengthening rate of inflation of wholesale prices in the Eurozone. Sector data signalled that clothing & footwear and food & drink drove cost pressures in August.

Gross Margins Drop

Retailers’ gross margins continued to fall sharply in August. The rate of deterioration eased since July, but was still among the fastest registered to date. Reflecting the relative strength of demand, Italian retailers posted the steepest drop in margins, and German retailers the weakest.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

Today in Pictures - Archstone's NoMa Apartments

Archstone's First + M apartments in NoMa was just the second apartment building to go online in the once quiet neighborhood, but thanks to its distinguishing design and sheer size, is helping transform the area that is now busy during the day and even sometimes at night.  Occupancy of the building began June 1, and the leasing office says that 162 of the 469 units are now occupied.

The building was designed by Davis Carter Scott and broke ground in June of 2010, and features 192 one bedrooms, 206 two bedrooms, and 71 three bedrooms – as well as a smidgen of ground floor retail.  Amenities include a communal "chef's kitchen" that opens onto an outdoor dining area, a 5000-square-foot 24-hour gym, a large interior courtyard, a “Rooftop Resort” that features a heated lap pool and sun deck, an internet cafe, a theater, two soundproof music studios, a bike workshop, even a pet spa.

Washington D.C. real estate development news

Read More

France to Hire 150,000 Subsidized Workers With Zero Qualifications; Why Stop There?

Looking for a loony idea to address unemployment in France? Look no further because I have a doozie.

Via Google Translate from El Economista, France will create 150,000 jobs for young people without qualifications

The French Government has today adopted a draft law providing for the creation of 150,000 subsidized jobs for young people with little or no qualifications, which are most affected by unemployment and employability harder.

The beneficiaries of these so called "jobs of tomorrow" will work for municipalities, hospitals, schools, social organizations, associations or, exceptionally, in private companies, and will receive a grant of up to 75% of their compensation.

The estimated cost is 500 million euros in 2013 and "more than 1,500 million" next year by the state budget, said Labor Minister Michel Sapin, at a press conference.

"We want contracts defined privilege" said Sapin, who nevertheless admitted that the storms are also accepted, and said that public support will be maintained in each case between one and three years, provided that employers provide a "accompaniment" to "very great difficulty youth push" to which they are targeted.

He insisted that the "accompaniment", which may include training for classical channels is "fundamental" to the 500,000 eligible people likely to have between 16 and 25 years, lack of skills and work.

Why Stop at 150,000?

The second half of that translation is a bit choppy but the bill clearly targets "500,000 eligible people" between 16 and 25 with no skills and no qualifications.

So, why stop at 150,000? Why not hire them all? And why stop at age 25? Why not hire everyone with no skills and no qualifications regardless of age?

Hopefully the answers are so obvious that hiring even 5,000 with no qualifications seems preposterous.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

Plans Presented for a New Woodridge Library

Despite its intense building spree over the past couple of years, the DC Public Library system isn’t quite finished. A final big project included in the budget for the city’s rebuilding of existing libraries is a redo of the Woodridge Library, located on Rhode Island Avenue in Northeast DC. On Monday night, architects Bing Thom and Wienceck + Associates met with local residents to introduce the new plans, which showed a three-story building with a roof deck, windows overlooking nearby Langdon Park, and a potential adjoining café.

The meeting, held at the existing library, was crowded with roughly 50 residents, according to library spokesman George Williams. Many had submitted suggestions earlier in the year for what they’d like to see in a new facility: a business center that included a fax machine, up-to-date books, more sitting areas, and better computers, lighting and restrooms.

The designs incorporated some of those hopes. While the skin of the building isn’t visible in the drawings and 3-D models, the structure is clearly airy, open and organic. From the outside, the facility’s most notable feature is its broad roof, designed to glow at night.  Internally, a series of balconies open the atmosphere, and a circular third story reading room looks out on a wide terrace largely shaded by the trellaced roof. Throughout the structure, southeastern walls are lined with windows to take advantage of the green hills of adjacent Langdon Park.

There are still lots of maybes on the table—like whether the facility will include that café, something residents throughout the city have clamored for in their libraries, but which doesn’t yet exist in any of the new structures. The architects would also like to close Hamlin Street, an east-west artery that runs just in front of the library, and create a public plaza instead. Williams said that library officials are discussing the issue with other government departments - and are also talking about how many parking spots can be accommodated on the site.

The presentation was largely well received by residents, who are by all accounts eager to see their library transform like so many others in the city. The only library within miles, the Woodridge facility is a squat, two-story brick structure built in 1958 that encompasses about 19,500 square feet. The new structure, which is fully funded at $16.5 million, would be approximately 22,500 s.f.

Library advocates and Rhode Island Avenue residents rejoiced when the architecture team was announced in April. Bing Thom, based in Canada, is responsible for the much-heralded renovated Arena Stage in Southwest, and the local Wienceck + Associates built the new Francis Gregory and Washington Highlands libraries. The Friends of Woodridge Library held a “meet and greet” to introduce Thom to the community in May, and Chief Librarian Ginnie Cooper traveled to British Columbia earlier this month to examine a library designed by Thom there.

Demolition is scheduled to begin next summer. The new library is slated to open in 2015.

Correction: The library is a two-story structure. The original post described it as having only one story.

Washington D.C. real estate development news

Read More

Morning Real Estate Review

DC's 21st century waterfront, connecting past with future (Atlantic Cities) The evolution of the revived waterfront is bringing design full circle, with urban parks ebbing and water-centered commerce on the rise.

Pending homes sales rise for 15th straight month (HousingWire) Pending home sales in July rose to the highest level since 2010.

Housing starts down in July, but permits up (NAHB)  The up and down swing of new homes reflects builders' timidity about being burned by the market, with construction slowed by a conservative housing outlook.

Life insurance companies bullish on DC real estate (Globe St)  As they make 2013 allocations, insurance companies are viewing DC as one of the top markets in the country, with investors bullish about next year.

Crystal City starts work on its Metro entrance enhancement (Crystal City BID)  A new, redesigned area outside the Metro entrance is another step in making neighborhood more attractive.

Read More

Governor Brown Admits the Obvious "We Have Lived Beyond Our Means"; Brown Agrees to Vast Overhaul of the California's Pension System; Unions Howl Over Obvious Truth

In a long-overdue moment, governor Jerry Brown has finally admitted the obvious, the state's pension system is broke and California Has "Lived Beyond Our Means". Unions of course are howling at that obvious admission.

Please consider California leaders strike public pension reform deal

California Governor Jerry Brown and lawmakers have reached a deal to raise public employees' retirement ages, have them pay more into their pension accounts, and cap retirement payments in a vast overhaul of the state's pension system that he says will save $30 billion.

California faces a huge liability for funding the nation's largest public pension system, but other states and cities also have enormous pension funding gaps and will be watching the state closely.

Brown did not get everything he wanted from lawmakers, such as a hybrid plan that would funnel some contributions into 401(k)-style accounts, and some of the deal's measures will not affect current employees.

"We have lived beyond our means," he said. "The chickens are coming home to roost and this is just one in a series of countermeasures that will be required over the next decade."

LABOR UNIONS OUTRAGED

Democrats in a conference committee of both legislative chambers approved the deal 4-0 late on Tuesday. The two Republicans on the committee abstained, protesting lack of time to study the measures, and labor groups were stunned.

"We are outraged that a Democratic governor and Democratic legislature are taking a wrecking ball to retirement security for teachers, firefighters, school employees, and police officers," said Dave Low, chairman of Californians for Retirement Security, which represents 1.5 million public employees and retirees.

Outside the state building where Brown unveiled the agreement, union activists said the deal unfairly bypassed collective bargaining rights.

"Labor did not have input on this and we are very, very concerned on what this will mean for rank-and-file workers," said Barbara Maynard, also with Californians for Retirement Security.

Labor Did Not Have Input

That my friends is precisely the way it should be. Labor does not deserve any input and collective bargaining by public unions needs to go the way of dinosaurs.

There is no public benefit to public unions, so there is no need for them. All public unions do is raise costs. The goal of public unions is to do no work for mammoth wages and benefits.

No one in their right mind would willingly take input from such a group.

Beacon of Light in Ocean of Darkness

The key sentence from Governor Brown stands out like a beacon of light in an ocean of darkness. In case you missed it, here it is: "This is just one in a series of countermeasures that will be required over the next decade."

Precisely. Brown's proposal is not the end of what needs to happen, it is the beginning of the beginning of what needs to happen.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Read More

Kristen Stewart's Momma Buys Malibu Beach House

Ever since pasty-pallored Twilight heart throb Rob Pattinson's often-sour-pussed Twilight cast mate and long-time girlfriend Kristen Stewart was caught smoochin' and coochin' with British-born and very-married neophyte movie director Rupert Sanders (Snow White and the Huntsman), the Pattin-Stew corner of the interweb has been a scalding conflagration of scandal, intrigue, outrage and harsh judgement by fans and foes alike.

Life can get so complicated sometimes, can't it? While we can't condone anyone stepping out on their love-mates and life-partners—unless it's an agreed upon thing, of course—these matters are personal so Your Mama's gonna—for the most part, anyways—leave the cheating lectures and monogamy moralizing to the children and focus, natch, on the (quasi-) related real estate matters at hand.

The celeb-watchers at US Weekly reported yesterday that Mister Pattinson had done booted his  unfaithful but reportedly deeply regretful ex-girlfriend from the swank Los Angeles, CA paradise he bought, they shared, and he now (allegedly) wants to sell because—as per an unidentified "insider"—it holds "too many memories."

We weren't surprised at these rumors or read the reports. Your Mama had thrice heard this scuttlebutt from no fewer than four separate sources more than a week ago. It will undoubtedly appear to many that Your Mama dropped the damn ball on this particular celebrity real estate scoop. And maybe we did. But, alas—and in all honesty—we were unable to come up with a proper confirmation or any significant details—i.e. an asking price—from any of our most trusted and reliable celebrity real estate moles. No shade intended on all my much-adored Chatty Cathies; That's just the way the ol' celebrity real estate llama spits sometimes, you know?

Anyhoodles poodles, our research shows Mister Pattinson—through a blind trust—picked up the 1.52-acre hillside spread (above) in a particularly posh pocket of L.A.'s star-packed Los Feliz neighborhood in September 2011 for $6,275,000. Not bad for a rather unkempt-looking fella in his mid-20s, is it now?

The walled, gated and no-doubt heavily fortified property was not listed on the open market but various online resources indicate the dignified, Spanish-style residence was built in 1921 for a wealthy insurance executive by architect Stiles O. Clements, measures 4,026 square feet and contains just 3 bedrooms and 3 bathrooms.

The extensive gardens and grounds include a curvaceous gated stone driveway; a second-gated motor court and garage; party-sized terraces off the rear of the main floor; and a painstakingly-planted, completely-landscaped and multi-terraced backyard that climbs the moderately steep hillside behind the house.

Near the top of the backyard oasis, well above the house, there's an honest-to-goodness amphitheater for a scheduled and impromptu performances and even higher up than that a dark-bottomed swimming pool and spa are set into an amorphous stone terrace, a location that not only takes in the city views but unfortunately assures—unless there's a facility up there we don't know about—lazy and/or full-bladdered sunbathers and swimmers will pee (or worse) in a flower bed behind a tree rather than embark on the long, thigh-busting journey down to the house and then undertake the ass-punishing climb back up to the pool. We suggest a high-speed funicular be installed if one hasn't already been.

The seller was movie director Robert Luketic (Legally Blonde, Monster-in-Law, 21) who bought the property from Oscar-winning cinematographer Robert Richardson (JFK, The Aviator, Inglourious Basterds, Kill Bill: Vol. 1 and II). Previous to that the house had been owned by boob-toob actor Noah Wylie (ER) and before that it belonged to English actor Tim Curry (The Rocky Horror Picture Show).

When K-Stew's cheating cat was let out of the bag, R-Pat, now out and about promoting the wildly-successful Cosmopolis, fled to friend Reese Witherspoon's semi-secluded ranch-compound in Ojai, CA. Miss Stewart, so the stories go, alternated between her parents long-time home in Woodland Hills and the Burbank bedsit of bestie actress Scout Taylor Compton. At one point Your Mama heard (but could and can not substantiate) she might also be squirreled away with a pal in Venice and two days ago we heard from another canary we'll call Divine Flowers who chirped to Your Mama that Miss Stewart might also be hiding out now and then in Malibu. Malibu?!? Miss Flowers, dontcha know, told Your Mama Miss Stewart "actually has a property" in Malibu then she thoughtfully and generously provided us with a location and street name.

This was the first we'd ever heard of this Malibu beach house bizness so we took to the interweb and in less than two minutes turned up indisputable evidence (in public records) that in September 2011 a quite contemporary house on the very street named by Miss Flowers was purchased for $4,800,000. However, it's important to note that all the several property records databases we perused show the almost ocean-front residence is actually owned by Miss Stewart's momma, Jules Mann Stewart.

Momma Stewart, a script supervisor originally from Australia, has been in Showbiz since at least the late 1980s with recent tee-vee and movie credits that include Scooby Doo! The Mystery Begins, The Sarah Silverman Program, and My Wife Is Retarded. Shaggy-maned Poppa John Stewart toils primarily as a Tinseltown stage manager for programs like Fear Factor, Man vs. Beast, Weakest Link and Family Feud.

A little internet elbow grease turned up a number of still available online listings for the "radically modern glass and steel" beach house that all show it measures 5,800 square feet while the L.A. County Tax Man shows it's 3,944 square feet. Make of that what you will. Listing information also shows the tree- and shrub-enshrouded mini-compound—lightly perched on a thick, poured concrete base and tucked into a discreet, low-key enclave—is wedged on to a tight .12 acre up-sloping lot, was built in 1993, and includes a total of five bedrooms and 4.5 bathrooms divided between the three story main house and the detached and unpredictably oval-shaped guest house.

Listing information states the house has been published a handful of times and listing photographs show the main living space finished in a Post-Modern(esque) sort of contemporary style with pale hardwood floors; a (probably gas) fireplace; long walls of both opaque and clear class; and a slender balcony with over the roof top Pacific Ocean view. The streamlined, galley-style kitchen has blond, burled wood cabinets; grey stone-tiled flooring; some sort of stone or solid-surface counter top; and sleek, stainless steel appliances.

A top floor family room/den, wrapped on three sides by frosted and clear glass, spills out to a root top terrace with panoramic (if not entirely unobstructed) views of the ocean and coastline. A terraced backyard with above-ground spa provides additional and protected outdoor space away from the wind and sea spray.

Now children, use yer noggins now. Firstly, keep in mind the listing photos show the house as it appeared at the time of the sale. the day-core is not that of Missus (or Miss) Stewart but rather, of course, that of the seller. Secondly, this house in Malibu is technically owned by Kristen Stewart's momma Jules Mann Stewart and not, as per property records, by Miss Stewart herself. However, despite her relative success in The Industry and despite our complete and total ignorance of her personal finances and/or net worth, we still think it seems like a bit of a stretch to imagine Momma Stewart has the wherewithal to purchase and maintain a nearly five million dollar beach house.

We confess we don't really know a thing about who actually provided the money to buy the Malibu beach house but we do know, based on a reasonably thorough peek and a poke around public property records, that K-Stew's momma has a straight up eclectic real estate palette. In addition to the (fairly) newly acquired, multi-million dollar Malibu beach house and the family's long-time, six bedroom and five bathroom residence in hot as Hades Woodland Hills, CA—bought in November 1998 for $620,000—Momma Stewart also owns a hodge-podge of residential and commercial properties that include (but may not be limited to):

—A nondescript commercial building in decidedly downmarket downtown Maricopa, CA, bought November 2004 for $59,000

—An undetermined amount of undeveloped land on a two lane state highway just outside of Gainesville, FL near the unlikely community of Williston


—A single-story, triplex apartment building in a leafy but lackluster corner of Pasadena, CA, bought in July 2008 for $628,000

—A couple of adjacent properties with a couple of itty-bitty cottages tucked into a ho-hum section of Topanga, CA and bought in April 2010 for $700,000


—a 1,665 square foot office building in Van Nuys, CA bought in July 2010 for $1,100,000

Although we did find young Miss Stewart's name briefly attached to triplex property a few years ago in Pasadena, it's not clear or obvious—at least to Your Mama—if the broken-hearted Twilight superstar does (or does not) have actual ownership of or a partial stake in any of the above-listed properties.

aerial photo (Los Angeles): Pacific Coast News
listing photos (Malibu): Pritchitt-Rapf & Associates (via Redfin)

Read More