Tuesday, June 24, 2008

The Bush Cartoon

KAL's cartoon
Jun 12th 2008
From The Economist print edition

Illustration by Kevin Kallaughe

Case Schiller declines over 17% yoy

Case-Shiller Composite 20 Price Index Off 17.8% from Peak
by CalculatedRisk
From MarketWatch: Four years of home gains have been wiped out
Home prices in 20 major U.S. cities have dropped a record 15.3% in the past year and are now back to where they were in 2004, according to the Case-Shiller home price index released Tuesday by Standard & Poor's.Prices in the 20 cities are now down 17.8% from the peak two years ago. The biggest declines were seen in Las Vegas, Miami and Phoenix, with prices falling by 25% or more in the past year. Prices in 10 cities have fallen by more than 10%. Prices were lower in April than they were a year earlier in all 20 cities tracked by the Case-Shiller index.Note that the Composite 20 is not the national index, but this show prices are still falling in many areas of the country - and still falling quickly (the Composite 20 fell 1.4% in April alone).

As noted earlier, S&P reported that the Case-Shiller home price composite indices declined sharply in April. The Case-Shiller composite 20 index (20 large cities) was off 15.3% YoY through April, and off 17.8% from the peak.Note: the composite 20 index is not the National Price index, but this does suggests the national index will be off sharply in Q2.However, 8 of the 12 cities in the composite 20 saw month to month price increases.

Case-Shiller Selected Cities Click on graph for larger image in new window.

This graph shows the price changes for several selected cities that I've been following. Prices continue to fall in the 'bubble' cities, like San Diego, Miami, and Las Vegas. Prices actually rose slightly in areas that saw less appreciation, like Denver and Cleveland. However this could just be seasonal noise, as these cities saw small increases last year at this time too.

The above post is courtesy Calculated Risk which is a blog I follow very closely. CR and Tanta the co-posters of that blog are very astute and they have been calling the housing downturn play by play. Thank you CR & Tanta for all the work you do.

China and Japan relations improve

from http://www.nytimes.com/

June 25, 2008
Japanese Warship Visits Chinese Port

SHANGHAI — In the first such visit since the Second World War, a Japanese naval warship steamed into a Chinese port on Tuesday, docking at a heavily guarded naval base in Guangdong Province for a five-day port of call.

The visit of the 4,650-ton destroyer Sazanami, which was billed as an earthquake relief mission, is being seen by many military and diplomatic analysts as part of a broad and gradual reconciliation between the two countries, the pace of which has quickened since a five-day visit to Japan in May by Chinese President Hu Jintao.

“When a naval vessel visits, it sends a clear signal that the countries have buried the hatchet and are working for peace,” said Gao Hong, director of the political research office of the Chinese Academy of Social Science’s Japanese Research Institute. “This is the clearest sign yet of the improvement in relations between the two countries. It says they no longer harbor animosity toward each other.”

Mr. Hu’s visit was the first by a Chinese head of state in a decade, and was seen by commentators in both countries as having moved Japan and China in the direction of a closer and friendlier working relationship.

Relations between the two neighbors have long been cool, in large part because of China’s lingering resentment of Japan’s conquest and occupation of this country between 1931 and 1945.
Mr. Hu’s visit was followed almost immediately by the devastating earthquake in Sichuan Province on May 12 that killed almost 70,000 people, and Japan earned a measure of goodwill here by being among the first countries to provide relief assistance.

Last week, the two countries also agreed on terms for the joint development of natural gas fields in disputed territorial waters of the East China Sea.

Each step in the reconciliation has brought reminders, however, of the depth of nationalist sentiment in China and of lingering emotions in some quarters against Japan. The warship visit, for example, was originally intended to take place early this month, according to Chinese media reports, but was postponed, ostensibly because of the political sensitivities.

As it is, the port of call is closed to most media, and the ship’s visit will be unusually low-key for a goodwill mission. The conservative Japanese newspaper, Sankei Shimbun, for example, reported that a planned concert performance by a Japanese naval band had been canceled and that access for Japanese media to the port had been restricted.

“We are considering the possible reaction of the Chinese people,” said Takashi Sekine, a Japanese Defense Ministry spokesman, according to Reuters. “We need to consider the situation.”

A Chinese Foreign Ministry spokesman, Liu Jianchao, denied that Chinese public opinion opposed the port call. “Strengthening our exchanges and cooperation in the field of defense will be supported by the people and I don’t think there will be any public anger,” he said in a news conference in Beijing.

The recent agreement over the development of gas fields in the East China Sea, however, illustrated the continued sensitivity of political developments involving Japan. Beijing handled the announcement of the agreement with unusual circumspection, and as word of the agreement spread, it quickly drew expressions of outrage from many Chinese Internet commentators. Chinese censors have busily removed many of the comments since then.

On Tuesday, there was a similar flurry of blogging activity, with one online commentator writing, “as long as Japan hasn’t made a formal apology for the history of invading into China, hasn’t stopped the domestic action of glorifying the invading history, we will oppose any of the Japanese military force coming again into China.”

Another reminder of sensitivities here came shortly after the earthquake, at a time when China was desperate to provide shelter for the affected populations of Sichuan Province. Japan offered to fly in tents and other emergency supplies aboard a military aircraft, but China appeared to change its mind on the airlift idea after considering the likely hostile public reaction to military aircraft from Japan.

An editorial in the state-run China Daily newspaper acknowledged the potential for controversy regarding the naval visit, but said that the Japanese ship visit was part of an effort to “build trust and dispel each other’s doubts.”

Saw the movie Children of Huang Shi last night. Moving picture with the brutal Japanese invasion of China as the background. Recommend watching. I dont think China Japanese relations will ever be anything beyond an uneasy and wary calm.