The Housing Bubble

The Gazette reports from Colorado. “The Pikes Peak region’s residential market has had thousands of foreclosure filings over each of the past three years. Commercial property owners are being plagued by the same woes homeowners have faced: a horrible economy, tumbling property values and difficulty borrowing money. Three years ago, the number of commercial properties with loan balances of $1 million or more, and which fell into foreclosure, totaled 15, according to a Gazette analysis of El Paso County Public Trustee records. A year later, the total was 24. In 2009, the number of commercial properties with loan balances of $1 million and up and that were foreclosed on had ballooned to 73.”

“‘I think there’s going to (be) a flood of distressed properties coming back on the market,’ said Jim Justus, president of a Springs brokerage.”

“A patient heading into a doctor or dentist’s office might notice chipped paint or a bathroom that’s not as clean, said Randy Dowis, a broker with NAI Highland Commercial Group in Colorado Springs. ‘It depends on how observant you are,’ Dowis said.”

“The downturn is good for investors because discounted properties will be available for sale — assuming a buyer has cash or can obtain a loan, he said. But property owners who aren’t in trouble should think twice about trying to sell. Falling values mean that owners who can wait out the downturn should hold onto their properties. ‘If you don’t need to sell it, forget about it,’ Justus said. ‘We’re in this for what could easily be another two years.’”

The Summit Daily in Colorado. “Some 5.4 percent of local residents were unemployed in January — well below the statewide rate of 8.2 percent, according to the Colorado Workforce Center. The Summit County unemployment rate may have been lower because more jobs are available during the ski season. Or perhaps people leave the pricey area when they can’t find work. ‘I think the economy is still fairly good, but we have seen a lot of people move out — particularly in the construction trade,’ said Jennifer Kermode, executive director of Summit Combined Housing Authority. ‘We’ve seen a lot of people relocate somewhere else.’”

“Summit County Commissioner Karn Stiegelmeier said that…there are many people who are self-employed or in real estate having an especially tough time making ends meet. ‘I think the true impact to the county, in terms of the needs, is greater than that,’ she said. ‘(Many) Realtors are not really getting an income they can live on.’”

The Salt Lake Tribune in Utah. “The tidy split-level on a large corner lot in West Valley City has a lot going for it. The house is in a nice neighborhood, it’s clean and updated, and has big yards front and back. Three years ago, at the market’s height, similarly priced homes would have sold quickly — some within days or even hours. But like scores of other properties priced in the low-$200,000 range in the Salt Lake area, this five-bedroom, three-bath property listed at $210,000 has languished on the market.”

“On a quiet cul-de-sac in West Jordan, sellers Joe and Kristina Duquette have their 1,900-square-foot home on the market for $224,900. In 2007, the couple saw homes in the area selling in the high $200,000s, with one topping out at $320,000. Today a foreclosure next door is listed for $195,000, while other sellers keep cutting prices. To help compensate, they recently lowered theirs by $10,000. ‘Even a year ago, homes were going for $250,000,’ said Joe Duquette.”

“After a few encounters with bargain-hungry buyers, many sellers ultimately decide to stay put and not move up. Others elect to rent, rather than sell their properties, even if it means getting rental income that doesn’t quite cover their mortgage. ‘Buyers want a three-bedroom, two-bathroom home with a fireplace for only $100,000,’ said Salt Lake Board of Realtors president Bill Heiner, only half-joking. ‘But that’s just not reality.’”

“Heiner stops in front of a house listed for $225,000. At the height of the market this house probably would have sold quickly, in the high $200,000s. Last year, it listed for $239,000, but where the price goes next is anyone’s guess. ‘This is about what a home like this should sell for,’ Heiner said. ‘But in a market like this, that doesn’t mean anything. All that matters is what a buyer is willing to pay.’”

The Associated Press in Arizona. “Hundreds of homeowners trying to avoid losing their homes to foreclosure met with housing counselors and lender representatives at an event in Glendale. Avoiding a foreclosure notice is just what drew Surprise resident Denise Knott to Glendale. Her home, bought in June 2008, has plunged in value and her fiance hasn’t been able to find work in construction. Still, the retail manager isn’t ready to walk away from her home. ‘I’m hoping to get my mortgage modified and get into a payment that I can sustain,’ she said.”

“But Knott is also realistic of her chances of getting a modification that lowers the debt to a level that makes sense. ‘I look at it this way,’ she said. ‘I love my home, I want to keep it. But I really might be better off letting it go and renting.’”

From KYMA in Arizona. “Shelley Ostrowski is a local expert and associate broker at Century 21 action group in Yuma. Ostrowski said, ‘I would say a decline is probably the best word to describe foreclosures in Yuma, but I do think its slowing. I do see from my business, that’s 95 percent foreclosures. I do see a slow down.’”

“She said even though foreclosure notices are down two percent from January, Yuma’s housing market is not out of the woods yet. Ostrowski said, ‘I think we’re still going to see quite a few, I do, but I’m not gonna say that it’s gonna be as heavy as last year.’”

“But there is a flip side. Ostrowski said in this buyer’s market, there lies great opportunity to cash in. That’s exactly what Yuma resident Ryan Seale has done. Seale said, ‘I bought a foreclosed home. Best investment ever, my first home, my wife and I bought it.’”

“Seale purchased a foreclosed home back in July of 2009. He said he’s never regretted the decision. Seale said, ‘A month later it was appraised at $25 thousand more than we bought it for. So right there I just made $25 thousand equity on it.’”

The Reno Gazette Journal in Nevada. “adjustable rate mortgages became popular during the housing boom as a way to get more people approved for loans. And particularly in Nevada, which continues to have the highest percentage of ARMs in the nation. The fact that ARMs continue to account for a large chunk of mortgages in Reno-Sparks makes them veritable wild cards for the local housing market.”

“One type of adjustable-rate mortgage, the ‘Alt-A’ ARM, accounted for 4,420, or about 60 percent, of active mortgages in the Reno-Sparks metro area by the end of December — a rate more than four times the national average. Of those ARMs, 2,267 have yet to reset. Although resetting ARMs hit Reno-Sparks hard just a few years ago, low interest rates should help soften the blow for this year’s resets. But this would be a temporary reprieve at best, said Ken Wiseman, broker-owner of Reno Rancho Realty.”

“‘With interest rates so low, some people will see their mortgage adjust to a lower interest rate,’ Wiseman said. ‘Unfortunately, it’s not going to be locked. And if interest rates start rising within the next year like many experts are saying, then you’re going to see another wave of people defaulting on their mortgages.’”

“Wiseman owns a condo rental with an ARM that he couldn’t refinance because it didn’t have enough equity. He tried a loan modification but was turned down. ‘They told me I didn’t qualify because I didn’t have ‘hardship,’ Wiseman said. ‘I guess they still see me as a target to make money from. I’m doing OK so I won’t just walk away. But rental rates have gone down so much that I’m sure a lot of people are just throwing in the towel.’”

The LA Times. “Few plans embodied the hubris of Nevada’s go-go years like Lake Las Vegas, the wannabe Tuscan village launched two decades ago 17 miles from the Las Vegas Strip. Over the years, Michael Jackson dodged paparazzi at the Ritz-Carlton. Elizabeth Taylor jetted in for her 75th birthday. Celine Dion bought a million-dollar home. At the time, it probably sounded like a can’t-miss pitch.”

“Conceived as a competitor to upscale getaway Palm Desert, Lake Las Vegas, on some days, is now more a lavish ghost town. The 3,600-acre development, like so many in Clark County, suffered one malady after another. When Lara Volkonskaya opened her Hermitage Art to Wear shop in 2008, she spent $25,000 on a single chandelier while retooling the store to resemble an art gallery. Her first customers all took home floaty — and pricey — silk clothing.”

“But within months, business had evaporated. ‘My store is a high-end store,’ Volkonskaya said. ‘Right now, I’m in the wrong place.’”

“Such a predicament was unfathomable to backers of Transcontinental Corp., which launched Lake Las Vegas. It was assumed that Lake Las Vegas would provide second and third homes, or investment properties, for the well-to-do. Transcontinental Corp. defaulted on $540 million in loans and lost the property in foreclosure. Lake Las Vegas was scooped up by a turnaround management firm, Atalon Group, and entered bankruptcy in 2008.”

“‘Put bluntly, the project was ill-equipped to deal with any slowdown in the real estate market,’ Atalon president Frederick Chin said in court documents. The development, he said, lacked money for infrastructure and the golf courses (only one of which remains open).”

“Inside the development’s gated communities, home after custom-made home was abandoned in the foreclosure crisis. Foreclosure sales have spiked, but the average closing price for foreclosed homes in December was $174,000. That same month, new home prices averaged $669,000. In the meantime, the new owners hope to woo more full-time residents and businesses have retooled their pitches for a less-affluent crowd. The Loews hotel, in hopes of luring corporate groups, dropped the word ‘resort’ from its marketing; that signaled extravagance.”

“Two years ago, Sandee Hiegel rented a one-bedroom condo for $1,400 a month, which she considered a bargain. This year, she moved to a similar condo for $900 a month. ‘They’re pretty much giving away units now,’ she said.”

“A hostess at the Black Pepper Grill in the MonteLago Village shopping district, Hiegel enjoys her short stroll to work and walking her two Maltese on the Ritz’s grounds. Would she buy something in Lake Las Vegas? She hesitated. ‘It’s got to come back,’ she said, a mantra oft-repeated in Nevada these days. ‘I mean, how much lower can it go?’”

The Las Vegas Sun in Nevada. “More than 150 people who filed into the Centennial High School gym at the start of a housing workshop Saturday hosted by Rep. Dina Titus, D-Nev. Peter and Jean Girard haven’t gone into foreclosure and they are still current on their credit card payments and two mortgages. But they are suffering and worry about what is next. After moving to Las Vegas in 2003 from Chicago to semi-retire, the couple saw the value of their house double in the boom years. So they bought and moved into a larger house and rented out the first.”

“Then things got tough; the values of both houses plummeted, Peter went back to working 60 hours a week and they had to use their retirement savings to get by. ‘I don’t know how long we can chip away at our retirement — not forever,’ Peter Girard said.”

“They tried to get the bank to change the rate on their second mortgage, but since they are current on their payments, Girard said the bank gave them a worse offer than what they already had. ‘When you get a ridiculous offer like that, you don’t even respond,’ Girard said. ‘Since we’re not behind, they don’t want to talk to us. If you’re in foreclosure you can get help, but if you’re not, you don’t…We don’t have sour grapes about any of it, but we need some adjustments to our mortgage.’”

“Johnny Holmstrom is a union plumber who lost his job when work finished at CityCenter. He has stopped paying his mortgage and got a letter saying the bank intends to foreclose on his house. ‘When you lose 60 percent of your income, it’s tough,’ he said. ‘The kids got to eat. What are you going to do?’”

“Holmstrom paid $250,000 for the house a few years ago, but the house across the street just sold for $75,000, he said, leaving help from the bank or foreclosure as his only ways out of the situation, he said. He said he hopes the bank will help, but he’s almost indifferent at this point. ‘They can have it back if they want it, but I don’t think they want it, so they need to work with me,’ he said while filling out a bank form. ‘Am I in bankruptcy?’ he read out loud, ‘Not yet, but it’s coming.’”

The Las Vegas Business Press in Nevada. “People are walking away from their mortgages by the thousands, making a financial decision that it’s better to take the hit on their credit score than try to recover $300,000 of negative equity on a $600,000 home purchased at the peak of the housing bubble. Bill and Lynn Jerbis haven’t paid their $2,400 monthly mortgage payment since October after failing to get a loan modification. Both have taken cuts in income. Meanwhile, the value of their home has dropped from $429,000 to about $142,000.”

“‘We can’t afford to pay this and live,’ Bill Jerbis said. ‘I would just be using the savings I had built up. We are not leaving, unless they physically come take us out of the home.’”

“While homeowners may not have jobs or assets today, time is on the lender’s side. ‘I hear (lender) attorneys say they’ll put a clock of one or two years on the debt, so the person can get a new job and back on their feet. Then they’ll start wage garnishment,’ bankruptcy attorney Philip Goldstein said. ‘It’s a very cruel economy right now.’”

“‘Here’s the predicament we find ourselves in,’ said housing analyst Larry Murphy of Las Vegas. ‘While some of our neighbors are negotiating a short sale or a loan modification or simply walking away from their home, others who elect to stay in their homes and continue making payments feel a sense of desperation and betrayal. Why? Because your neighbor who paid $240,000 on his home and put 5 percent down now owes $225,000 on a home worth $95,000. His equity in the home is negative $130,000. Even if his home appreciates at 3 percent a year for the next 25 years, it will only be worth $198,000.’”

“‘So your neighbor vacates his home, which goes into foreclosure, sits empty, deteriorates, taxes don’t get paid, homeowners association fees don’t get paid, the value declines, which in turn causes all the homes in the neighborhood to decline. Now your neighbor no longer has negative $130,000 equity. Instead, he has zero equity. Now which equity would you rather have in a home? Zero or negative $130,000?’”

“Tisha Black-Chernine of Black Lobello law firm in Las Vegas, said people tried to get a loan modification and when that didn’t work, they opted for the short sale. Now they just don’t want to pay their mortgage. ‘They’re going to look at strategic default with a keener eye,’ Black-Chernine said. ‘We’re at 60 percent negative equity position in some houses. They’re starting to realize it’s throwing money in the hole.’”

“Lynn Jerbis knows one thing is certain — no remedy exists that will make her home whole. ‘At 59 years old, we don’t have the time for this home to come back in value,’ she said. ‘We will die before we see equity.’”

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The Nashua Telegraph reports on New Hampshire. “In terms of home foreclosures, Scrooge took a holiday in December, but in January, he came back strong. The state saw 352 foreclosure deeds in January, a record for that month and the second most ever, just seven behind the 359 of last October, according to statistics compiled by the New Hampshire Housing Finance Authority. ‘This level of foreclosure activity may reflect the possible deferral by lenders of foreclosure proceedings during the holiday period, and it certainly offers evidence of the continued economic distress of many New Hampshire home owners,’ according to the authority’s report.”

“Banks will hold off on foreclosing in December for two reasons: They’re hesitant to foreclose during the holidays, and December can be a tough month for scheduling, said Jane Law, director of communications for the New Hampshire Housing Finance Authority. ‘That has happened in the past, particularly by some of the larger lenders,’ Law said.”

“Nashua Realtor Paul LaFlamme said he handled two foreclosures in January, which he called a ‘heavy’ number for one month. And there might be more coming, said LaFlamme, whose business includes short sales. Some banks have approached LaFlamme to get his opinion on the market value of properties, an indication that the lenders might be preparing to take ownership of the properties, he said.”

The Union Leader in New Hampshire. “There were 505 bankruptcy filings in February, a historic high for that month in New Hampshire. It’s the highest number since the bankruptcy laws were changed in 2005, and comes after a record January, when 381 bankruptcies were filed here. Sandra Kuhn, vice president of FamilyLegal law firm in Concord, isn’t surprised that bankruptcy filings are at an all-time high. These days, many of her clients are unemployed and unable to find work. ‘They’re living paycheck to paycheck, and when they don’t have that paycheck, they’re spiraling out of control,’ she said.”

“Meanwhile, new mortgage data indicate the problem still may be getting worse. The latest National Delinquency Survey by the Mortgage Bankers Association found that delinquencies continue to rise in New Hampshire, with 9 percent of all home loans past due in the fourth quarter of 2009. (Rates were not seasonally adjusted.) In sheer numbers, 10,674 prime loans and 5,446 subprime loans in New Hampshire were delinquent at the end of last year, according to the MBA.”

“The psychological aspects of foreclosure and bankruptcy can seem even more difficult for many these days, according to Kuhn. While some national experts say the economy is improving, folks who are still unemployed or losing their homes aren’t seeing any improvement. Kuhn would like to see a moratorium on mortgage payments — a kind of ‘breathing room’ — for those who are jobless.”

“‘It’s really, really hard if you’re unemployed, to be able sometimes to pay your mortgage,’ she said. ‘The thing is, nobody’s getting jobs.’”

The Times Argus in Vermont. “The recession continues to make its presence felt in Vermont as the number of homeowners facing foreclosure jumped 17 percent last year. There were 1,928 foreclosures filed in the state in 2009 compared to 1,639 the prior year, according to the Department of Banking, Insurance, Securities and Health Care Administration. With the exception of Rutland County, foreclosures increased in all 14 counties in the state last year.”

“The number of calls to the Mortgage Assistance Program hotline would indicate that more foreclosures are likely, at least in the near term, said Thomas Candon, deputy commissioner of the Department of Banking, Insurance, Securities and Health Care Administration. Some distressed homeowners are working with lenders to modify the terms of their mortgage using a voluntary loan modification program. But Candon said a successful outcome for many homeowners is questionable.”

“‘We’ve had people actually calls us, get into a loan modification, come out of it, go back into another one,’ said Candon, in pointing out the difficulty.”

The Warwick Beacon in Rhode Island. “Following the lead of its neighbors, Warwick gave first passage to an ordinance that city council members hope will work to stem foreclosures in the city at Monday evening’s meeting. ‘When I checked the number of foreclosures I was simply shocked and I said to myself ‘something needs to be done about this,’ said Helen Taylor (Ward-3). ‘This forces the banks and the lenders to sit down with the homeowners to negotiate with them to refinance or lower the price of the monthly payments that they’re required to pay.’”

“The process does allow for foreclosures to take place, but only after a good faith effort at resolution has occurred. Bill White, president of Coastway Community Bank, says that’s already happening. He observed it is not in the bank’s interest to foreclose, as the bank ends up selling the property at less than what it is worth. ‘When talking about some of the larger out of state banks maybe they aren’t going through the process, but we bend over backward. Where people have had extenuating circumstances we modify payments. It’s our best bet to get paid,’ he said.”

“‘I don’t see it as a productive step,’ he added. White said legislators are ‘making judgment we haven’t done that (attempted to keep people in their homes) and we have. I’m sure it is well intentioned but speaking for Coastway it misses the mark.’”

“Despite voting for the ordinance, councilman Ray Gallucci (Ward-8), said he believes it will be difficult to enforce. ‘I think it’s a good piece of legislation, but if we can’t enforce it, what good will it really do. I’m hearing Providence is having some trouble enforcing it,’ said Gallucci.”

The Boston Globe in Massachusetts. “Massachusetts could face a second wave of foreclosures as tens of thousands of distressed and bank-owned properties hit the market, slowing the state’s nascent housing recovery, officials from the Massachusetts Housing Partnership said. Clark Ziegler, executive director of the state’s quasi-public, affordable housing agency, said there are about 64,000 distressed properties in so-called shadow inventory poised to go on the market because they have delinquent mortgages, are in foreclosure, or already are owned by a lender.”

“‘The report is not warning of the ‘next big crisis,’ Ziegler said, but is a reminder that the housing market still a long way from recovery. ‘The reality is that there are more [foreclosed properties] to come, and it will stretch out how long it takes the recovery to play out,’ Ziegler said. ‘It is a cautionary tale.’”

“Alan Clayton-Matthews, a professor of public policy at Northeastern University, doesn’t believe shadow inventory will have a big impact locally. He said shadow inventory has been an issue for a while. ‘If this were a problem, it would derail the recovery in housing. We would have seen its effects by now,’ Clayton-Matthews said.”

“But Barry Bluestone, dean of the School of Public Policy and Urban Affairs at Northeastern University, said he was alarmed to see a recent surge in auctions of foreclosed homes, which can bring down prices especially in hard-hit towns. The number of published auction announcements tracked by Warren Group jumped in January by 81.5 percent to 2,385 compared with 1,314 in the same month in 2009. ‘The number of auctions is off the chart,’ Bluestone said. ‘It can have the effect of continuing to depress prices just as they are continuing to come back.’”

The Asbury Park Press in New Jersey. “The total value of properties in the township has decreased by about 7.5 percent, from $6.16 billion to about $5.7 billion, following the township-wide reassessment completed in December. The reassessment was intended to bring valuations in the township closer to market-rate figures, after Manalapan lost nearly $300,000 in legal fees and judgments in 360 lost tax challenges last year.”

“The average township home is now assessed at about $376,900, a 12 percent decrease from last year’s figure, $428,480. But the new valuation won’t be used on local and county tax bills until after 2010 municipal, school, fire and other budgets are adopted, township Chief Financial Officer Patricia Addario said. ‘(The reassessment) is not necessarily good news, because the value is irrelevant until you determine what the rate is,’ said Alan Ginsberg, an accountant who saw the assessment on his single-family Wildflower Court Colonial dip by about 13 percent.”

“Gov. Chris Christie’s looming budget cuts will put the brakes on an already slow economy, but the short-term pain will make New Jersey more competitive, Joel Naroff, an economist, said Thursday. ‘The issue was not the pain, but how to spread the pain,’ Naroff said. ‘We now have a governor who intends to inflict a major amount of pain across the state. And I congratulate him for that.’”

“Short of the creation of a bubble that rivaled the technology bubble of the 1990s and the housing bubble of the 2000s, consumers will remain stingy and the economy will grow only modestly, Naroff said. ‘I call it a change in strategy from shop ’til you drop to shop ’til you’re tired,’ Naroff said.”

“It means the state can’t count on a very big increase in tax revenue, leaving the state government faced with slashing expenses — a move that won’t be confined to the public sector, he said. ‘Everybody has to pay a steep price in the short-term,’ Naroff said after his speech, ’so that in the long-term we can have an economically competitive state.’”

Crain’s New York Business. “Real estate developer Shaya Boymelgreen’s Web site proclaims his finance business is ‘built on a solid foundation.’ He might wish to revisit that statement after federal regulators seized LibertyPointe Bank, an institution that he helped start and served as chairman. LibertyPointe late Thursday became the first New York City bank to fail in 11 years. For Mr. Boymelgreen, it was just the latest turn of the screw.”

“In January, he was evicted from his corporate headquarters in Brooklyn after the landlord said Mr. Boymelgreen stopped paying rent. Several of his real estate projects are stalled, and he faces a flood of lawsuits alleging everything from failure to repay loans to fraud and negligence, as well as breach of contract related to the construction and sale of two condominium projects.”

“Mr. Boymelgreen branched into banking in 2005, starting LibertyPointe with a partner named Meyer Eichler, the founder a Coney Island Avenue bookstore that bills itself as the world’s largest Judaica store. The idea was the bank would serve Brooklyn’s Orthodox Jewish population. ‘Money is begging us to come out,’ Mr. Eichler told The Brooklyn Paper at the time.”

The Real Deal on New York. “State Attorney General Andrew Cuomo’s office, which regulates the sale of condominiums in New York, has told the developers of the financially-troubled One Madison Park condominium to offer refunds to any buyers that have not closed on their apartments, The Real Deal has learned.”

“Cuomo’s office forced the rescission offers after senior lender Istar Financial filed last month to foreclose on developers Ira Shapiro and Marc Jacobs for allegedly defaulting on five months of interest payments, pledging apartments without the bank’s permission and allowing the building loan to fall out of balance by $63.6 million, according to court documents and legal sources.”

“Such a move would require the developers to refund deposits on more than 40 percent of the 69-unit tower at 23 East 22nd Street, as half of the units are under contract and a dozen of those contracts have closed, according to Department of Finance records.”

The New York Times. “Senate Banking Committee members from both parties said on Wednesday that they had agreed to include in their regulatory overhaul bill a new Office of Research and Analysis that would provide early warnings of possible systemic collapses, Edward Wyatt and Sewell Chan report in The New York Times. By standardizing financial instruments and reporting mechanisms, the agency would give regulators a broader view of the health of participants in the financial markets and the potential for problems to spread. The idea’s supporters say that kind of information was lacking in recent years as the housing bubble burst and troubles spread from firm to firm.”

“‘One of the problems we observed in the recent crisis is that nobody knew who had what,’ said Senator Jack Reed, a Rhode Island Democrat who last month introduced a stand-alone bill to establish a National Institute of Finance. ‘The result was a cascading effect of uncertainty and doubt.’”

From CNN Money. “In the U.S. Senate, the progressives are restless. A handful of them are making it known that Democratic leaders shouldn’t take their votes for granted when it comes to Wall Street reform. ‘I won’t vote for a bill if the banks have control of it,’ said Sen. Sherrod Brown, D-Ohio.”

“Brown sits on the Banking, Housing and Urban Affairs Committee and is among a group worried that Democrats have given away too much to woo Republican support for the bill. ‘Republicans are doing the bidding of their benefactors, the banks,’ he said.”

“The warnings come as committee Chairman Chris Dodd announced that negotiations with Republicans are taking too long and that he will unveil his own Wall Street reform bill Monday. Though Dodd’s proposal has no Republican support, the Connecticut Democrat said he will incorporate many Republican ideas in the hopes he will win bipartisan support.”

“Two other senators who have expressed deep reservations: Bernie Sanders, I-Vermont, and Ted Kaufman, D-Delaware. In remarks on the Senate floor, Kaufman warned that he won’t get behind ‘compromise measures that give only the illusion of change and a false sense of accomplishment.’”

“Sanders said he would vote against a Wall Street reform bill unless it includes an independent consumer regulator and tough new restrictions on banks. ‘The American people are disgusted with the behavior of Wall Street, and they don’t want us to go back to a time when Wall Street had no accountability and no regulation,’ Sanders said.”

“Still another Democratic senator, who asked not to be named, said the influence of banks isn’t limited to senators in just one party. ‘These banking institutions are so powerful, they’re all afraid of taking them on,’ the senator said.”

The Hartford Courant in Connecticut. “Unemployment in Connecticut ticked up slightly to 9 percent in January, the highest in this recession, according to a new report released by the state Department of Labor. The January rate, up from 8.8 percent in December, is the highest number for Connecticut since 1976, but it still is lower than the national rate of 9.7 percent.”

“In a sign of recovery, employers in Connecticut added 2,300 jobs in January — the first time since October that the net job figure increased and only the second time since March 2008. ‘Don’t break open the champagne, but you can open a bottle of beer over that one,’ said economist Nick Perna, a Yale lecturer and economic adviser to Webster Bank.”

“Over the past 12 months, construction had the biggest loss by percentage — 12 percent fewer jobs — and professional and business services lost the most positions, 18,600 over the year. Overall, the state’s economy reached 1,610,400 jobs in January, down by 52,500 from January 2009. The decline since the employment peak in March 2008 was 101,100, or nearly 6 percent of all jobs. ‘There’s a long way to go to regain the jobs that have been lost, Perna said. ‘All the TARP and all the other stuff from out there just kept the bottom from falling out,’ he said.”

“Perna is one of a stable of economists who make forecasts for the Wall Street Journal. That newspaper asked him which of five things was the greatest threat to the economy: scarcity of credit to small and medium-size businesses, losses in commercial real estate, another decline in the housing market, the U.S. deficit and less spending from consumers.”

“His answer: ‘None of the above. The U.S. Congress. And I mean that.’ Perna said the Senate has gone beyond gridlock to ‘armed conflict.’ ‘These people have gotten ideologically constipated,’ he said. “I think we’re now incapable of making reasonable economic policy in Washington.’”

The Norwich Bulletin in Connecticut. “Eastern Connecticut home foreclosures rose last month, with Windham County registering the highest percentage of the state’s eight counties. Windham County foreclosures rose 41 percent to 106 from 75 in January, according to RealtyTra. Windham’s February rate was 32.5 percent higher than the 80 foreclosures in the same month in 2009.”

“New London County foreclosures rose 11 percent to 174 in February from 157 in January. New London’s number was up 39 percent from the 125 in February 2009, RealtyTrac statistics show. The figures made New London the No. 5 county in the foreclosure rate rankings. The head officer of the region’s real estate sellers association wasn’t alarmed by the numbers. ‘Connecticut is in much better shape than the rest of the country,” said John Bolduc, CEO of the Norwich-based Eastern Connecticut Association of Realtors.”

“Connecticut had less of a housing boom than states such as Arizona, California and Florida, meaning the foreclosure problem is not as intense. Bolduc said he expects foreclosures to remain a problem for another year or two. ‘It’ll hang around, but things should get better,’ he said.”

The Wethersfield Post in Connecticut. “With jobs disappearing, unemployment growing and Connecticut facing an ongoing budget nightmare - in an election year - the Spring 2010 issue of ‘The Connecticut Economy: A University of Connecticut Quarterly Review,’ analyzes the state’s grim budget prospects.”

“The Quarterly Review also examines the economic consequences of local policy decisions including zoning controls, taxes, spending and regional cooperation that affect property values and the mix of residential housing. The editors note that Connecticut is an old state and growing older; the 39.4 median age of the state’s population ranks Connecticut as the seventh oldest state in the nation.
So, if Connecticut hopes to replace its aging, retirement-bound baby boomers with a cadre of younger workers, it needs to import them with a mix of challenging jobs, good pay and affordable housing, writes Quarterly Executive Editor Steven Lanza.”

“However, like most towns in other states, Connecticut communities have long used zoning controls to regulate the pace, mix and location of development. Lanza examines whether zoning works at cross purposes with broader public policy objectives, such as attracting young professionals to a rapidly graying state.”

“To shed light on how local policies affect real property values, co-editor Dennis Heffley and UConn economics Ph.D. graduate student Ekaterina Gnedenko apply a novel ‘open city’ model to examine policies including municipal taxes, spending, zoning and regional cooperation that maximize local property values.”

‘They note that ‘if property values reflect not just a town’s site and socioeconomic conditions, but also ‘how the town is run,’ then public officials who seek to enhance property values may be serving the interests of their constituents well.’”