Archive

November 25th, 2016

Mortgage rates spike to near yearly highs following Trump victory

    The sharpest spike of the year in mortgage rates came after Donald Trump's win.

    According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average soared to 3.94 percent this week with an average 0.5 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) That's 37 basis points higher than a week ago when it was 3.57 percent and the fifth-largest one-week jump in the 30-year fixed rate since 2000. (A basis point is 0.01 percentage point.) It was 3.97 percent a year ago. The 30-year fixed rate hasn't been this high since January.

    The 15-year fixed-rate average jumped to 3.14 percent with an average 0.5 point. It was 2.88 percent a week ago and 3.18 percent a year ago. The 15-year fixed rate hasn't been above 3 percent since February.

    The five-year adjustable rate average climbed to 3.07 percent with an average 0.4 point. It was 2.88 percent a week ago and 2.98 percent a year ago. This is the first time since January the five-year ARM has been higher than 3 percent.

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Japanese officials cling to Donald Trump's history as a businessman

    President-elect Donald Trump's surprise victory has left government officials around the world -- including here in Japan -- scrambling to make sense of the most uncertain moment in U.S. political history since the election of Ronald Reagan, if not before. They have been hanging on every tweet.

    The emerging view -- or, more likely, hope -- among many top Japanese officials is that Trump is a pragmatist willing to reverse himself. "In one of his Twitter entries," noted Tomohiko Taniguchi, a close adviser to Japanese Prime Minister Shinzo Abe, a few days after the election, "he denied what he said during the election campaign about how South Korea and Japan should go nuclear."

    The alternative -- that Trump actually meant many of the things he said in the presidential race -- seems unthinkable.

    Earlier that day, I sat down with another senior Japanese government official. His tone suggested optimism -- or was it disbelief? "The strong point of President Trump is that people do not expect a kind of consistency," he said. "The president is decided, but they can change the policy any time."

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How World War III could begin in Latvia

    Four years ago, I predicted Russia's invasion of Ukraine. Here's my next prediction, which by now will strike many people as obvious: The Baltics are next, and will pose one of President-elect Donald Trump's first and greatest tests. It probably won't take the form of an overt invasion.

    Russian President Vladimir Putin has a clear goal and a grand strategy. But it's not the most realists perceive. Some argue that he is driven by fundamentally rational, defensive goals: NATO expansion appeared threatening and Russia is pushing back. The West expanded its sphere of influence at Russia's expense, and Russia is now retaliating. That's why the "Ukraine Crisis Is the West's Fault," according to John Mearsheimer.

    As with most academic realist analysis, this is nonsense. Putin is not driven by cold calculations of rational self-interest, because no human is. We are not Vulcans. We are driven by our perception of self-interest as shaped and defined by our deeper presuppositions and beliefs - which is to say, our ideology or religion.

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November 24th

Why many of us will miss Gwen Ifill

    Like other friends and fans of Gwen Ifill, I did not expect to be talking about her in the past tense. Not this soon.

    The groundbreaking, award-winning "PBS NewsHour" co-anchor died Nov. 14 in hospice care in Washington. The cause was endometrial cancer, according to her brother Roberto Ifill.

    She was 61. That surprised me. With her relentlessly youthful zest for life she didn't look that old. Yet it was shocking to hear that she had died so young.

    Those of us who were fortunate enough to have known her or worked with her can speak of her deeply held belief in the finest tenets of journalism, such as accuracy, fairness and a quest for balance without resorting to false equivalencies.

    But what was most memorable about her was her unshakeable and thoroughly engaging on-camera presence in her two jobs since 1999: co-anchor with Judy Woodruff on "PBS NewsHour" and moderator on PBS' "Washington Week."

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How a Trump administration could lead to trade and capital controls

    Despite a presidential campaign in which Donald Trump blasted his opponent for ties to Wall Street, financial markets seem pretty giddy about the incoming Trump administration. And in the short term, they're not wrong for feeling that way.

    The prospect of far-reaching financial deregulation seems at play. President-elect Trump's tax plan would slash rates for those working on Wall Street. His proposed infrastructure plan, although somewhatdodgy in the details, seems like an additional Keynesian fiscal stimulus (along with any increase in defense spending). And it appears that Trump will be sprinkling his administration with plenty of Goldman Sachs alums.

    As Politico's Ben White concludes, "Christmas has arrived early for Wall Street in the early days of the Donald Trump era." No wonder the stock market and the dollar have surged in value over the past week.

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How a Trump administration could lead to trade and capital controls

    Despite a presidential campaign in which Donald Trump blasted his opponent for ties to Wall Street, financial markets seem pretty giddy about the incoming Trump administration. And in the short term, they're not wrong for feeling that way.

    The prospect of far-reaching financial deregulation seems at play. President-elect Trump's tax plan would slash rates for those working on Wall Street. His proposed infrastructure plan, although somewhatdodgy in the details, seems like an additional Keynesian fiscal stimulus (along with any increase in defense spending). And it appears that Trump will be sprinkling his administration with plenty of Goldman Sachs alums.

    As Politico's Ben White concludes, "Christmas has arrived early for Wall Street in the early days of the Donald Trump era." No wonder the stock market and the dollar have surged in value over the past week.

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Give Steve Bannon a chance. It's not like he's literally Joseph Goebbels.

    Listen, what proof do you have that this dead lizard wrapped in the Confederate flag will not make an excellent chief strategist and senior counselor to the president of the United States?

    I, for one, believe that everyone deserves a chance.

    You're not wrong that this appears to be a pig's head slowly rotting on a stake, grotesque insinuations pouring from its mouth as flies buzz around it in the island heat, but I would need to learn more about it, honestly. I'm no expert.

    You say that this man just painted a swastika on a church but -- couldn't it be a plus sign? We don't know. Some people are better at drawing plus signs than others. I wouldn't read anything into it. Maybe he just loves churches.

    Yes, okay, this rabid opossum bit me on the ankle, then handed me an Islamophobic pamphlet, but we have no proof it wrote the pamphlet. This is America, where we give the benefit of the doubt.

    You say, "potato enthusiastically supported by the Ku Klux Klan's David Duke"; I say, "controversial potato."

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Germany and Merkel are ready for Trump

    As U.S. President Barack Obama visits Berlin to prepare Chancellor Angela Merkel for a future he doesn't understand himself, it may look as if he is passing the baton of free world leadership to her. It's hard to imagine how Merkel could take on any such role and why she would want to. She may be the last strong idealist among major Western leaders, but she's also a pragmatist, and in some ways, the new U.S. administration may suit her just as well as the outgoing one did.

    German newspapers describe the relationship between Obama and Merkel as "late-blooming love" or "love at second sight." By German standards, which are far to the left of U.S. ones, Merkel is a conservative, and Obama the progressive didn't immediately impress her -- thus her still-remembered decision to deny him the Brandenburg Gate as the backdrop for his Berlin speech in 2008, when he was still running for president. Later, however, Obama and Merkel came to agree on almost every important matter: free trade, climate change, Russia's new assertiveness, immigration. (According to Obama, Merkel's decision to temporarily open the German border to Syrian refugees was "on the right side of history").

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Even a Republican Congress might block some of Trump's agenda

    Congress is not, to put it mildly, the most popular institution in the United States. Its approval ratings are low. It has developed a reputation for mindless obstructionism. And when Donald Trump promises to "drain the swamp" in Washington, he seems to be talking in large part about the legislature.

    Congress may also be the last, best hope of those who fear substantial parts of Trump's announced agenda.

    Our national legislature has a reputation for fecklessness in disputes with the White House. After all, legislation nearly always requires the president's signature, so how can lawmakers hope to rein him in? But this standard view is too myopic -- Congress does a lot of things other than pass legislation, and most of them do not require presidential assent. Moreover, many of them can form effective tools with which to push back against the president's agenda.

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Don't build Trump's wall. Amend the Constitution

    I support expanding legal immigration. I believe in welcoming refugees. I think deporting 11 million illegal immigrants is cruel and impractical, some form of amnesty is inevitable and wise, and Donald Trump's wall on the border with Mexico would be a $25 billion boondoggle.

    I also believe that the U.S. needs to pass a constitutional amendment making it impossible for anyone living in the country illegally after that point to acquire legal permanent residency or citizenship, including for their children born here.

    As part of a package of comprehensive immigration reforms, such an amendment could both curb illegal immigration and help heal one of the biggest partisan rifts facing the country. It would remove a huge incentive for illegal immigration. It would reinforce the importance of citizenship, bolster public support for legal immigration, and honor the 4.5 million would-be immigrants waiting patiently for their green cards. And it would affirm that we are a nation of laws, not loopholes -- surely one reason many immigrants are attracted to the U.S. in the first place.

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