neonvincent

In my previous Buzz about Detroit from Model D Media post, I noted:

Nearly all of my most popular articles here seem to the ones in which I comment on a New York Times article about how Detroit and its suburbs are dealing with contraction. This one fits that mold, except that it's more optimistic.

That seems to be the theme for nearly all the articles from Model D Media's Buzz page. Of course, one should expect that from a publication whose Twitter profile states:

We love Detroit. We write about Detroit. We photograph Detroit. We film Detroit. We want you to love Detroit, too.

...And whose attitude I characterized as "Optimism but not business as usual." They're certainly living up to both my billing and their own.

This week, I present three articles that protray Detroit, not as a disaster and not as a place being reborn from its ashes, but as a phoenix worth visiting. No, I'm not kidding. Detroit is now a place for the adventurous to visit and settle in.

( Excerpts of and commentary on travel and real estate articles from the New York Times, BBC, and Financial Times behind the cut. )

Above originally posted to Crazy Eddie's Motie News as Detroit as a travel destination? The New York Times, BBC, and Financial Times think so.

Suburbia: What a Concept
By ALLISON ARIEFF

There is no more iconic suburb than Levittown, the postwar planned community built by the developer William Levitt in the late 1940s, so it is understandable that in launching Open House, a collaborative project to imagine a “future suburbia,” the Dutch design collective Droog in collaboration with Diller Scofidio + Renfro architects would make it the focus of their inquiry.

"Future Suburbia"--now, that looks promising, especially if it can solve the issues facing a car-centered way of living during a time when being car-centered is likely to be more of a liability than an asset. It would be nice if the designers came up with something that actually solved some of the real problems with suburban living during a time of resource shortage and economic contraction that was more uplifting than Kunstler's dismal vision of them being "the slums of the future" with "two or more families living in a McMansion" and "crops growing where the front lawn used to be." Unfortunately, they didn't.

But in approaching a real place as a perfect blank canvas on which to execute distinctly urban interventions, the Open House project conveniently excused itself from substantively engaging with the real issues facing suburbia’s future. Which is a pity. Because it would have been interesting to see what they’d come up with if they had.

What a wasted opportunity!

[T]he suburban existence is as exotic to them as say, Dubai, the site of Droog Lab’s first project where, says co-founder Renny Ramakers, they’d made a deliberate decision not to explore it as “a spending society — people felt we weren’t being critical enough; they couldn’t understand why. In this project I don’t want to be critical, I want to look for inspiration because in every part of the world, people are creating their own society, their own community.”

But that’s not really valid. Can we discuss the future of suburbia (or the future of anything, really) without being critical? Without talking about developing accessible transit or increasing walkability (and community) through mixed-use development, for example? This alas, is not uncommon. Addressing suburban ills requires massive change to systems, to finance, to transportation and infrastructure, and perhaps most challenging, to a culture deeply wedded to suburbia as emblematic of the American Dream.

Above originally posted to Crazy Eddie's Motie News.

Update to this entry, in which I posted the following from the Detroit Free Press.

Median home sale prices were down 13.3% in metro Detroit to $58,000 last month, compared with $66,900 in March 2010. Prices were down in all counties, but sales prices in the city of Detroit rose by 10%, to a median of $8,505 from $7,725.

Prices are also down, but note the price rise in Detroit proper. That's an early sign of a possible recovery, even if it's starting at a very low level. In a BAU environment, I'd say that the local market is very close to a bottom. The BAU people agree.

Kathy Coon, broker/owner of Real Living Great Lakes in Rochester Hills, said that prices are coming up despite the March readings.

"Once the appraisers see what is going on in the market, the prices will start coming back up," she said. "The good houses right now are selling really quickly, those that are priced right and in good condition. We are seeing the good foreclosures selling really quickly with multiple offers."

Looks like Ms. Coon was right. A few days after I posted that news, the Free Press followed up.

February metro home sales up 1% from January

The metro area gained 1% in February compared with January, but was down 3.7% from February 2010, according to S&P/Case-Shiller home price data released Tuesday. Home prices for the top 20 cities in America were down by 3.3% from a year ago and down by 1.1% compared with January.

Detroit was the only major metropolitan area in the U.S. to show an increase in prices month-over-month according to the Case-Schiller index. Even so, home prices here are only 68% of what they were in 2000. Business as usual? Not quite.

Above originally posted to Crazy Eddie's Motie News.

A few days ago, I described how oil prices dropped and stocks went up on news of bin Ladin's death. I also said that it wouldn't last, a view shared by Kunstler.

This morning, Bloomberg is putting out a story that the price of West Texas Intermediate crude oil dropped - from $113 to 112 - because Bin Laden was tossed into the sea. How long will that state of affairs last, I wonder. Through eleven o'clock in the morning, Eastern time?

He called it, at least in the short run, as West Texas Intermediate rebounded to its Friday levels by noon. However, that price drop now looks like a preview of coming attractions.

Reuters: Oil crashes 10 percent in record rout
By Matthew Robinson
NEW YORK | Thu May 5, 2011 5:40pm EDT

Oil collapsed into free-fall on Thursday, diving as much as 10 percent and sending U.S. crude back under $100 a barrel as investors staged a nearly unprecedented stampede for the exits.

This could be interpreted as good news, as it means that gasoline prices are likely to drop soon. However, it isn't entirely good news, as it is a sign that the market became worried that the price was getting high enough to impede expansion.

Weak economic data from Europe and the United States fed concerns that have battered commodities all week. German industrial orders fell unexpectedly in March while U.S. weekly jobless claims hit eight-month highs, sparking a fourth day of profit taking in early trade.

The oil markets have been doing this dance for a year now. Just about every time oil's share of U.S. GDP starts to pass 4%, Hamilton's magic number for contraction, the price drops. The traders are acting as if they know what that 4% share (or the 6.5% of personal income spent on energy) means and they sell off.

But the onslaught of selling went far beyond any single cause.

I've also heard and read that the projected end of the second round of quantitative easing has let the air out of commodities, although Krugman disputes that it's just the dollar.  He even points out that the recent price rise in Euros has been even higher in percentage terms than it has been in US Dollar terms with the following graph.



Speaking of Europe, Brent crude also followed suit.

Brent crude plunged more than $12 at one point -- exceeding the sell-off that followed Lehman Brothers' collapse.

That's even better news for lowering gas prices, as a lot of the gasoline in the U.S. is refined from oil priced as Brent, not WTI.

So, how long will this trend last?

0"The longer-term bull cycle is still in place, but this correction may have a life span of several months, as weaker economic data is fueling this correction to a large part," said Sterling Smith, senior analyst for Country Hedging Inc in Minnesota.

Just long enough to the economy to expand some more, that's how long. If I were Obama, I'd hope oil prices and the U.S. economy keep doing their dance until November of 2012. Maybe they will.



Above originally posted to Crazy Eddie's Motie News, along with videos about the effects of higher gas prices on the Detroit economy, both good and bad, and gas rising above $4.00/gallon for the first time since 2008.

It's been more than a month since I promised you all an analysis of the Census for Detroit. I haven't exactly followed through, even though the Census figured in several posts since then, so it's high time I bring you some more news inspired by the Census, even if it is a bit old.

Detroit News: Empty homes dot Oakland County's upscale suburbs
Laura Berman
Last Updated: April 07. 2011 5:47PM

Numbers don't lie: They tell unpleasant stories, including new census numbers pinpointing high vacancy rates in some of Oakland County's most elite suburbs.

The half-secret behind many of the well-maintained facades and manicured lawns of some of the area's most lavish properties is that nobody's home.

Birmingham (9.4 percent) and Bloomfield Hills (10.2 percent) showed vacancy rates significantly higher than 10 years ago. Those rates are similar to Detroit's vacancy rate a decade ago.

Those of you from metro Detroit reading this entry should understand exactly what this means. For those reading who are not familiar with the area, these two towns are very upscale suburbs, the equivalent of Beverly Hills and Westwood/Bel-Air in Los Angeles. Imagine those areas with 9-10% vacancy rates. That would be very distressing.

Tiny Lake Angelus, with 132 households in north Oakland County, is historically a pocket of the county's wealth. Always private, the census takers also found that 13.2 percent of the residences were unoccupied. Vacancies in Farmington Hills were 6.8 percent, up from 3.3 percent in 2000.

The first one--eep! This enclave of Richistan is not doing well at all! The second shows that things are bad, but that areas that are more solidly middle-class instead of rich, people are staying in their homes if they can.

"One of the striking things is that the foreclosure crisis has hit parts of Oakland County that we would have thought are untouchable," said Andy Meisner, Oakland County treasurer.

This is one of the signs that things are not business as usual (BAU), nor are they going to be for the foreseeable future. Too bad. In a BAU climate, I'd be very optimistic about an economic recovery around here. There's nothing a lot of energy for economic activity wouldn't fix. But this isn't BAU, so I'm not very optimistic about BAU solutions.

Back to the article.

Vacancy is a distress signal and communities try to hide the red flags of emptiness. Owners — even banks — maintain the lawns and exteriors, and when they don't, neighbors call the city.

"Even our blight is better," quipped Annabel Cohen, a Bloomfield Township homeowner who hasn't noticed any deterioration.

Snerk You wish. Also, let's see how long that lasts.

Others aren't as chipper, saying that as the crisis goes on, homeowners are more likely to be as distressed as their unsold properties.

Lots more at the link in the headline. I will pass on on one bit of advice from the article before moving on--watch the lawns this summer to see which houses are really occupied, and which are just being kept up to look that way by the bank. Also, keep in mind that those figures are from a year ago. Things could be worse by now. Or, they could be better.

( The Detroit Free Press has more articles about the real estate situation here in Metro Detoit. I'll give the good, the bad, and the ugly. )

Above originally posted as The Census on vacancy rates plus the Good, the Bad, and the Ugly about March 2011 real estate in Metro Detroit on Crazy Eddie's Motie News along with Earth Day in the National Progressive Press.

Crazy Eddie Motie News: Weekend News Linkspam--Midwest University News

By virtue of having a week's worth of news as green as its school colors, Michigan State managed to have yesterday's linkspam pretty much all to itself. Now, the rest of the Midwestern public research universities get their turns.

University of Michigan: The Population Bomb: How we survived it

ANN ARBOR, Mich.—World population will reach 7 billion this year, prompting new concerns about whether the world will soon face a major population crisis.

"In spite of 50 years of the fastest population growth on record, the world did remarkably well in producing enough food and reducing poverty," said University of Michigan economist David Lam, in his presidential address at the annual meeting of the Population Association of America.

Lam is a professor of economics and a research professor at the U-M Institute for Social Research. The talk is titled "How the World Survived the Population Bomb: Lessons from 50 Years of Exceptional Demographic History."

In 1968, when Paul Ehrlich's book, "The Population Bomb," triggered alarm about the impact of a rapidly growing world population, growth rates were about 2 percent and world population doubled in the 39 years between 1960 and 1999.

According to Lam, that is something that never happened before and will never happen again.

I think someone is being too optimistic. Then again, it's an economist saying this, not an ecologist.

University of Michigan: Personal income up, but are we better off?

ANN ARBOR, Mich.—Although U.S. personal income per capita has risen 5.7 percent since 2000, an increase in tax-exempt benefits provided by the government and employers accounted for all of the income growth in the past decade, says a University of Michigan economist.

Thanks to these nontaxable transfer payments, which include Social Security, Medicare, Medicaid, health insurance, unemployment, welfare and disability benefits, inflation-adjusted personal income per capita rose nearly $2,200 since 2000, despite America's worst economic recession since the Great Depression.

But when growth in transfer payments and employer-paid benefits are excluded, U.S. taxable income per capita actually decreased 3.4 percent from $32,403 to $31,303, says economist Don Grimes of the U-M Institute for Research on Labor, Economics, and the Economy.

"Last week, the Bureau of Economic Analysis released preliminary personal income statistics for all states and the data shows that personal income per capita in the United States increased," Grimes said. "But, why don't we feel better off? Because the personal income per capita data includes 'spending' that we don't recognize as contributing to our economic well-being.

"Most people are not going to feel better off if their employer has to pay higher health insurance premiums, even if to government statistics experts it is the appropriate way to measure our well-being, which strictly speaking it is."

See this graph from Calculated Risk for personal income minus transfer payments:



No, we're not back to where we were before the recession.

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