Cartoons by Tom Toles used to be a regular feature here, but, for some reason, they’ve appeared here infrequently over the last year or two. This one was worth the wait.
From the Tom Toles archive at the Washington Post.
Worrisome signs have been emerging from China in recent weeks that all is not well. Home prices have been notching modest declines of a fraction of a percent over each of the last three months (though this may be one case where the government’s data is manipulated even more than usual) and the manufacturing sector saw a modest contraction in November for the first time since 2009.
Today, the Chinese services sector notched its weakest growth in three months and, after the central bank loosened bank reserve requirements last week after two years of tightening, policymakers fret that slowing growth could lead to social unrest. Amid daily calls by pundits for a “hard landing”, the LA Times reports that the planned economy is in trouble.
According to an official New China News Agency report published Saturday, China’s top security chief warned provincial officials to brace for unrest if financial conditions continue to deteriorate.
Zhou Yongkang, a member of China’s nine-person Politburo Standing Committee, said the country should focus on developing better social management -– a euphemism for control aimed at stamping out opposition and unrest.
“The Party and the government have always paid a lot of attention to social management … but it still cannot keep up with the changes in economic and social development,” Zhou reportedly said, using typically dense party jargon.
“Faced with the negative impact of the market economy, we still have not established a complete social-management system,” Zhou continued. “How to establish a social management with Chinese characteristics to suit the socialistic market economic system in China is the most pressing task we face today.”
With the labor market now showing some distress as the number of strikes and other protests escalates, income inequality is an increasingly important issue to workers with increasingly idle hands and this is not good news for the government.
Last night, 60 Minutes ran two segments on the failure to prosecute anyone on Wall Street for their involvement in the subprime disaster and 2008 financial crisis and former senior executive at Countrywide Financial Eileen Foster kicks off part one below.
You’ve got to hand it to her for not taking that hush money after she was fired. I imagine we’ll be hearing more from her in the future and, if all goes well, Countrywide founder Angelo Mozillo will someday see the inside of a jail cell. Part two is here.
From the other day, Yale Economist Robert Shiller talks about the latest S&P Case Shiller Home Price Index that showed property values are again falling sharply and he notes that there’s no reason to think they’ll go up anytime soon.
They say that market bottoms are made when everyone’s lost interest and that time could soon be approaching for housing here in the U.S., a good example of this being that neither of these two seem much interested in talking about it.
Standard & Poor’s reported that the Case-Shiller 10-City and 20-City Home Price Indexes rose 0.2 percent from July to August, but when seasonal factors are taken into account, the indexes were down 0.2 percent and flat, respectively. The nation’s best housing market remains the nation’s capital where home prices rose an impressive 1.6 percent in August and, along with basket-case Detroit, were the only cities with year-over-year gains.
Ten of the 20 cities saw home prices increase in August while 16 cities saw improving annual returns, though, prices continue to decline on a year-over-year basis as the 10-City and 20-City indexes saw annual returns of -3.5 percent and -3.8 percent, respectively.