Bits Bucket And Craigslist Finds For December 28, 2006
Please post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
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Hilarious deflating baloon noises
http://marketplace.publicradio.org/shows/2006/12/27/PM200612273.html
“VIGELAND: Well, you know, if you look at the national housing market from the beginning of the year to now the end of it, I think you would say, yes, the bubble popped. But let me take that back and say no, it didn’t really pop so much as dissipate. If you think about it like a balloon and you’re kind of squeezing the top of it and letting the air out with a little squeak . . .
MOON: That always makes an interesting noise.”
So does the sound of hot gas escaping from the mouths of REIC experts who keep insisting a soft landing is on the way with no credible evidence to support the claim.
I was thinking about it and so long as I’m not in tornado alley a mobile home seems like a decent idea I’d pay lot rent in place of ‘HOA and property tax’ and not have shared walls. The home itself is going to cost 10-15% of an actual home. What am I missing here?
I thought of this too, and then I did some deliveries in the area.
I’m not sure my neighbors and I would get along
You have to be very selective on where you park your mobile home. I know of a place in Tucson that has a 24/7 guarded gate. The guard verifies the visitor has an invitation to come in from the resident and takes down the name. I was there years ago to visit an accountant of my aunt and uncle to take care of some financial dealings. It was nice and neat inside. Not extravagant, but not expensive. Other mobile home parks have no guarded entry and you tend to see them as scenes on “Cops.” On the high extreme, I hear there is a mobile home park with million dollar mobile homes at PVE. Expensive, but the ocean views are out of this world!
Andy,
take a look at this upscale “trailer” designed by a Canadian team–solar and wind power equipped, it’s designed to be off the grid and the included furniture and bath are high quality.
http://www.sustain.ca/
You might see other alternatives at fabprefab.com
Who would live in that POS? That would take the greatest of GF’s.
‘The MSRP for our show model is $145,000 CAD. The beta units are under a limited warranty for the period of 1 year, with subcomponent and equipment assemblies carrying their own warranties from 3 to 20 years. We will be posting a detailed options:cost breakdown on the website by the end of August.’
Affordable? I’ll wait until they come out on DVD.
I like it, but it looks like it is out of a woody allen movie!
More Jacques Tati I think.
http://www.imdb.com/title/tt0069400/
The truth about affordable housing is mobile homes. Politicians like to say ‘wee need affordable housing DESPERATELY’ then they pass zoning laws against mobile homes.
What they really mean is ‘we need more apartments and condos to generate high revenue’ and don’t forget mostly high end homes go up.
The blue states that pretend to care about middle class and poor are the LEAST affordable states that have laws that crush the middle class (CA-prop 13, rent control causes lack of supply for rent, no mobile homes, no ‘high density’ housing)
And so RED states are way more affordable/livable for regular people and they are where capitalism free markets are more able to set prices.
Um, no. Blue states tend to have more expensive housing because they have superior job markets and higher overall wages due to improved knowledge bases and standards of living.
thats nuts. the median price in CA 10 years ago was under 200k. same job market. Its growth restrictions on land that are more of a factor.
Well known Econ fact - high taxes keep out the “undesirables.” Blue states are known for high taxes, hence “Taxachussetts.” Education did not bring better living to Blue, only people that can afford to live in Blue are mostly educated.
I think Prop 13 protects people so they don’t lose their homes in unstable markets. It’s very fair, IMO, however, I do feel people who bought in the last few years are paying too much property tax. Prop 13 protects the little guy so he can feel secure that he can pay his taxes in the future. I bought years ago…if I had to pay the taxes on my home now, it would be unaffordable.
You are right about rent control but it’s not all over the Blue States. I am in a Blue state but we have no rent control.
I used to hate prop 13. But now I think anything that deprives govt of money is good. Anyway I suppose rents would be even higher without it.
“And so RED states are way more affordable/livable for regular people and they are where capitalism free markets are more able to set prices.”
Are you talking about the laissez-faire naval shipyard in Virginia or in Mississippi? Or the laissez-faire grazing fees and mineral leases in the Mountain States? Or is it the laissez-faire price supports for the farmers in the Plains States?
A North Attleboro man faces financial ruin because he built a new home so close to dangerous high-voltage transmission lines that fluorescent bulbs inside the house light up without even being plugged in.
http://news.bostonherald.com/localRegional/view.bg?articleid=174189
Not to absolve the town’s approval of a building permit, but the appraiser, who I assume was working for the institution which lent this guy his construction dough, should have noted this acute, horrific economic obsolescence this in his report.
Obviously, the report was down by an incompetent trainee hack intent on simply collecting his $125.00 fee split.
Just another loathsome example of the residual inherantly unqualified garbage which consitutes the appraisal profession these days.
On a construction loan the appraisal is based on blueprints!
WAMan
There are 3 approaches to Value…Cost, Market Data, and Income Approach.
Blueprints are used for the Cost Approach only, which is usually the least reliable indicator of value.
Many lenders don’t even require the application unless the home is less than 5 years old.
Economic obsolescence is applied in the Direct Sales Comparison Approach and Income Approach.
Whew…talk about a demise your gross rent multiplier because the tenants can’t open the door or get in the bath
with out fear of electrocution.
If the loan officer was doin’ his job by the retention of a knowledgeable appraiser, reporting back to him, this project would have been DOA before a pencil had even been to paper for the appraisal report.
Many lenders don’t even require the application unless the home is less than 5 years old.
We are talking about NEW CONSTRUCTION! I am building a house next year and have already talked about construction loans with several lenders and they all have said they use the blueprints and the county tax documents to value the home to be built.
WaMan-
Guess I’m not in tune with the way lenders do biz in your neck of the woods.
Cost is not synonomous with value.
You can spend a bazillion dollars for a place, but if it’s got a load of functional obsolescence in the floor plan or is substantially overbuilt for the location you’re gonna lose a bundle on re-sale.
why one earth would anyone even consider building that close to power lines?
I wonder if this guy had a survey completed prior to turning the first shovel of dirt? It would have shown the power company easement which the homeowner now claims is wrong. It should have been handled first, not last.
Free lighting.
Why do people build near power lines? Check out the contruction near a power PLANT in Philly. I posted pics of this on the photo gallery link on this site. The photos are numbers 5 and 6.
I doubt the power plant accidentally illuminates anything nearby, but you can always hear the 60 Hz hum within a block of the place.
Now that has to be the Greatest Fool of all time.
My wife and I are always amazed at these big McMansions that people put up overlooking a interstate highway or worse. The only reason why the fool could have built such a house is cause the land is worth next to nothing.
Land being scarce in L.A., there are a few housing developments built on old dumps, all cleaned up. What sort of person is “ok” with the idea of these living conditions?
Yea, I can’t wait for the horror to begin with that development behind the Getty. That place was dump for many years. You’d have to be insane to purchase a house over there.
This level of stupidity is …. shocking.
And so it begins — Violent crime is up in the nation. Particularly ominous for people in big cities — this is a critical component of how well cities like mine will do in a downturn -you cannot believe how much faster property values can decline when people no longer feel safe in their cities and neighborhoods.
http://www.npr.org/templates/story/story.php?storyId=6647024
interesting quote:
Blumstein finds the robbery numbers especially troubling, because they’ve always served as a warning of what’s to come.
“There’s clearly a growing number of people who have no future in our economy,” Blumstein says. “There are basically three modes of earning income: One is to have a job, the other is welfare. The third is theft.”
Housegeek-
Some Mazzhole thinktank just did a study on the growing unemployment for limited education (HS and below) males ages 18 thru 54.
Since the historical jobs which this group traditionally gravitated to, meaning entry manufacturing positions in areas like steel, paper, shoes, textiles, auto parts, etc., etc., has been exported, there is now a dire social situation of what do with them.
In a total disconnect, the report went on to say training should be undertaken to place them in the burgeoning female dominated fields of health care, social welfare work, and education.
LMFAO…Who the fook are these people kidding?
My opinion is that as these workers become increasingly desperate, you are liking to finding a gun suddenly stuck in your nose as you return to your car in some dimly lit parking lot after a visit to a restaurant or shopping place.
Your comment on large city disintegration is right on target.
I laugh at the fools buyin’ high price residences right in the middle of this coming socio-economic apocalypse.
Hi-ho Fort Apache.
hd74man, I think you’re correct on all counts yet I believe the demographics support a flight to the city centers by the aging class. We’re seeing the evidence everywhere. NY, Beantown, Philly are all building “luxury” condo’s and highrises.
CC-Yes, this seems demographic trend has been a focus of the MSM currently.
The pundits hope is the influx of million dollar condo owners will result in a gentification of these urban centers
and all will live happily ever after.
Homicides are up drastically in Beantown. The violence is becoming increasingly random. Personally, I believe a generation raised without father’s weaned on a combo of violent video games and the gangsta image spewed like no tomorrow on MTV will create a crime havoc like nobody has ever seen before.
The people movin’ into the cities are molly-coddled suburban burghers who don’t have a clue.
I think their reality is based reading too many urban living mags. It’s the opposite of the “Country Living” movement.
As somebody who homesteaded in Maine with a solar house in the early 80’s, that rag used to put me into hysterics.
I repeat my ending slogan for the new urban pioneers…
Hi-ho Fort Apache…be sure to lock those front gates.
Ah yes…. Mother Earth News. The toilet rag that sent scores of imbecilic white urbanites to rural areas to live out an idealized fantasy but when it finally dawned on the dumbasses that they couldn’t make it/didn’t like it/etc, they went broke and moved backed to areas where they could make some dough.
I do remember that. Deja Vu.
I hope after homesteading in the country you stayed in the country.
SM-
No-Eventually kids came and needed better schools. I later became a divorce statistic and my biz collapsed from the distraction.
After 30 years of rural living I now find myself, back in my hometown on the northshore of Beantown, attending to a dying father and elderly mother.
The commonplace rudeness arrogance, smugness, and full blown, outright worship of material possessions by the people who inhabit this realm simply blows me away.
It is total crass materialism run amuck all fed by hyper-inflated real estate values.
I am like a fish out of water.
hd74man,
Come to NJ. You’ll think beantown is an episode of little house on the prarie. Some of these people are so out of touch with reality, they have no idea that they’re living in a fantasy world. Consume, buy, consume, buy, consume, buy….. It’s quite sad.
If you do not require the material things consider yourself rich.
SM-Good words to live by, but I have to say there is so much to the adage, your perception of wealth is relative to what you see around you.
In Maine, I basically felt very wealthy. I took my sustenance from the wide open spaces.
In Mazz, I feel like a total loser.
And the gals I’ve on the i-net dating services, never cease to remind me.
I’ll bet on more than one occasion someone in Mass has dropped a small fortune on a house just because it had its own big backyard. In the country unless a sign says you can’t trespass, it’s virtually all your own backyard without owning it. Besides, as long as you have to pay taxes on that backyard in Mass, it’s never really yours - you are in essence simply renting it.
From Faith Popcorn’s 2007 predictions released this week:
http://biz.yahoo.com/prnews/061226/nytu023.html?.v=75
“The Future: A person’s net worth is no longer measured by dollars earned, but by improvements made. Families compete with each other on how many people they fed while on vacation, and the most envied house on the block is not the biggest, but the most sustainable”.
I’m not sure I put much stock in pop futurists’ predictions, but since keeping up with the Jones’ is a game that society at large can’t win, perhaps people will eventually just get exhausted playing it and gravitate to less materialistic pursuits.
You’re expounding the explanation of why my summers in Maine are great and winters are lousy if I spend them in So. Cal. But, I expect to get “richer” as others get “foreclosed” …
I would have to add to this, S. FL might take the cake for hyper-consumerism. Everyone down here thinks they are Don Johnson.
Anyway, living in Palm Beach is an experience, that’s for sure. I can almost promise, with 10 mins on the highway, I will see a Lambo, and an Bently (the Continental GT is like a Ford Taurus down here its so common).
Anyway, I am sure other places are worse, but the hyperspending here is pretty hard to take.
Walked into Gucci in the Gardens Mall about a week ago. 5K for a handbag? Are you FING>LHOPSDYLK:JLKj out of your mind??
Then I looked around, and I noticed that lots of people in the mall had..exactly that handbag! My GF (girlfriend, not greater fool) had to clue me in “They are all knockoff babe”.
WTF? Why would anyone pay for the real thing when everyone thinks its a knockoff anyway?
Stupidity is just staggering.
They’re building condos in Philadelphia, but the market has dried up. Not too many are buying anymore. Yes, some boomers moved from ‘burbs to city, and some of the high-end condo inventory went to NYers who left Manhattan after the WTC attacks.
Mainly the boomers in the Phila. metro area are flocking to the 55+ communities in the counties ringing the city.
As for the increase of crime in Philadelphia, things started to deteriorate when John Street took up where Ed Rendell left off.
Agreed. A friend of mine is looking to rent a place in Philly, so she went to craiglist. She found a bunch of really nice rentals in all of the new CONDO buildings. All of the units that are for rent are owned by “investors” and f**ked flippers.
She told me that one of the f**ked flippers is going to rent his condo until he can sell it at $475K. I don’t know what he paid for the unit, but she said that it was less than $475K. The owner belives that market will turn in the near future.
I think he’s making a big mistake if he holds on to the unit. He’s only asking $1400/month for rent, so the rent covers just a fraction of his monthly payment (assuming that he put little money down).
This guy is being fed the NAR’s BS about the market turning in 2007 — instead of selling NOW at a loss and cutting his almost-certain future losses.
More trouble in Philly, an alleged “no bubble here” city.
Until a few days ago, there were two homes for sale within a block of my home. One was asking $650K and the other was asking $1.2M. Both had been on the market for many months.
Lo and behold, both “for sale” signs are gone. I contacted the agent, who infomed me that both homes will be relisted in 2007. God only knows how many other agents are using the same strategy.
Can someone please explain to me why agents believe that a listing becomes “stale” after it is on the market for a long time? I don’t buy that reasoning. If I am a new buyer, why would I care if the home I’m looking at has been on the market for 8 months rather than 8 days? If the home — and its price — suits me, then I’ll buy it. I don’t get this whole “stale listing” thing.
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fishing for a GF. if the DOM is too long, the realtwhores are afraid it might scare away the GFs. pull the listing and the DOM resets. so much for ethical marketing.
Hi Gekko. While I’m quite familiar with this tactic, I still don’t understand how a long DOM scares away buyers. Why would a buyer care if the DOM is long? Isn’t this just a figment of the imagination of the realwhore?
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Long DOM could be perceived as something must be wrong with the house - ie undesirable. (other than just price).
Wow. Are people that stupid? (That’s a rhetorical question…)
To me, a home with a long DOM would signal that the property is priced too high and that I could negotiate with the seller.
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perception is reality.
As a vulture waiting to buy just one house, long DOM, especially for a new house, is my signal to go in with a “low” (as in, year 1999) offer. Partly true for used houses as well, but there I have to deal with ego, whereas for the new one I am just dealing with margin and the builder’s reluctance to screw the comps. I think the odds are better with the latter.
There is an excellent book by Robert Reich (cannot pull the name in, someone else will know) about just this idea. How we are moving from a service/manufacturing economy to a knowledge based economy.
That’s great for those of us who are educated, and who are able to participate in the economic upswing. However, when you think about how many dumb people you meet in a given day…. What are they all going to do to remain a part of this society?
Trust me, if all hope is removed for moving up to a better life, we will have a disaster. The dream of “rags to riches” drives many in this country, if that is a lost ideal (only the knowledge workers will ever have money) then we are in for some very bad times.
“Trust me, if all hope is removed for moving up to a better life, we will have a disaster.”
It’s dwindling at a rapid rate as even the most uninformed knows upward mobility is nothing more than a dream of yesteryear. They may not be able to define upward mobility or even spell it, but they feel it.
Care to define “knowledge based economy”?
Richard Florida pointed out similar findings with more hard data to back them up. Creativity is what has value nowadays. Being able to make products is something anyone with a big room full of robots can do. Coming up with the new product that people will want to buy is the key. The big complication with this is that historically manufacturing has driven this level of innovation. D’oh!
No need to worry in 20 -30 years the rich Chinese and Indians will be buying junk made in America.
I believe there is a high probability of tha WAman.
No one in their right mind would open a factory or some such in the US unless they have to. You have high taxes, high wages, the lawyer tax is unpredictable.
If a woman or minority sues another one of your employees for some civil rights made up fiction the employer will have to pay millions or pay them off to avoid a legal battle. What kind of capitalism do we have here we should think about it more.
What about when they sue for genuine discrimination?
Sandra,
The people haters haven’t thought of that one yet.
Its all nice and makes us all feel good to allow 12 million dollar settlements for genuine discrimination but its now and ‘industry’ to sue for this. The result is jobs going overseas. Maybe there should be a cap at a years salary or something for these awards. You have to admit millions is too much.
I agree. The “hope for a better life” is now based on a winning lottery ticket…not putting in the sweat equity that previous generations needed to be successful. Not to mention ethics, compassion, and humility.
There is plenty of blame to go around, and there are lots of theories of how we came to this depressing state of affairs, all of which are true to some degree. No matter…it all comes together like some hideous hurricane and it is frightening. And I’m a positive person.
agree. The “hope for a better life” is now based on a winning lottery ticket…not putting in the sweat equity that previous generations needed to be successful.
You need those lottery ticket winnings for start up capital.
There’s no more goin’ to Uncle Henry hat in hand for a $500 loan.
Sure hard to start a biz here in Mazzholeland, when a simple commercial site, like to place to park your bulldozer, dump truck, with a maintenance shed (we’ll assume a small scale start up construction biz whereby scores of lesser educated became successful in the Greatest Gen) can easily cost a million bucks.
And no matter what ya say, there isn’t any way your gonna cash flow a seat of the pants start-up biz bein’ a million clams in the hole before you’ve even dug a fencepost.
I will try.
So, Robert gives us several different levels of development. Argricultural based, manufacturing based, service based, and knowledge based (the highest level). A knowledge based economy is where people are paid for what they know; and how they can apply that to problems. Think “doctor”. Your paying them for their knowledge, the training they have had and what they can do to make your life better.
However, the problem is, only a small percentage of people can take part in an economy based on knowledge. It’s like it we decided that only people who can squat 400lbs can work in this country. A huge percentage of the population can’t do it; they just do not have the makeup, or the inclination to spend years in the gym working up to it (akin to schooling/training). And therefore, they are excluded from the “good” jobs, or any jobs, because of their inability to function on that level.
The book is called:
The Work of Nations: Preparing Ourselves for 21st Century Capitalism
Also, I found a Wiki on Knoweldge Based Economy:
http://en.wikipedia.org/wiki/Knowledge_economy
The book mentioned here, by Peter Drucker, is a great introduction to the ideas, if your interested. I like Reich better, but that’s just me.
he has a 5 ft 3 view of capitalism
has embrassed the big spend w krugman
“human investment”
FREEer healthcare etc……
“My opinion is that as these workers become increasingly desperate, you are liking to finding a gun suddenly stuck in your nose as you return to your car in some dimly lit parking lot after a visit to a restaurant or shopping place.”
The key to avoiding this situation is to ALWAYS PARK OR DO YOUR SHOPPING IN A WELL LIGHTED PLACE WITHIN SIGHT OF WITNESSES OR LOTS OF PASSERBYS. Theives,robbers,criminials preying on likely victms like dark, deserted places with no lookers. A SuburbAN or city resident who goes back to their dwelling at dusk or at night in an unlocked/unguarded complex which has few dwellers/kids running about outside and is in a questionable urban area would make a good target. It would be a good idea to carry mace or teargas in questionable urban areas:a handgun is only practical for home defense.
PeteM-I was simply stated the situation as a simple example of an activity which suburban burghers take for granted.
The Boston Globe has reported repeated incidents of daylight smash and grab robberies along swanky Newbury St. in Beantown over the shopping season.
Desperation and the criminal element doesn’t give a rot about lighting circumstances anymore.
I think you might want to read up on the story of Kitty Genovese before dispensing such advice:
http://www.crimelibrary.com/serial_killers/predators/kitty_genovese/
Sickening. Her neighbors watched and did nothing. In a better world they would been held accountable for their inaction. The lessons of this story are as clear today as they were all those decades ago.
OMG I just read the whole story. I feel depressed. So much darkness.
Those (liberals) who say that there are no “bad” people are out of their minds and not facing reality. It is clear that some people commit evil, for evil’s sake.
“I think you might want to read up on the story of Kitty Genovese before dispensing such advice:”
I have done deliveries at midnight in some of the toughest meanest ghettos in LA , including compton, east LA,Scentral LA, so maybe i might actually know a thing or two about avoiding getting jacked or assaulted on mean dark/lighted streets in inner city hoods. Have actually confronted crazed knife-welding hoodlums face to face, and was involved in a carjack in compton. This actually can also occur in supposedly safe LA neighborhoods even in broad daylight, where cruising gang-thugs spot a lone person walking down a quiet neighborhood street and quckly dash out of their car and do a rapid hit and run ‘jacking’. One cannot say if you do this and that that your safety is 100% guaranteed, but my advise will reduce your chances of becoming a crime stat by quite a bit. Maybe a pair of constantly roving eyes, and constant scanning of areas at least a half block up and down the street, even driving around the block a few times to spot intruders, might be worth it. It Takes finely attuned street -level instincts to spot potential trouble, which may be as simple as an assailant lurking behind bushes or hiding behind a parked auto . A pair of fast feet and a bull voice/primal scream/yell may also be a lifesaver in case some ghetto homeys zero in and make a dash at you.
On a just barely related note; our tolerance for illegal aliens. Iv’e always thought our tolerance for illegal labor had a lot to do with our economy and our overall feeling of wealth. It is something we can afford (tolerate) when times are good
Give us a drawn out recession - maybe bordering on a depression - while overshooting the mean in a reversion to it, and I wonder how much tolerance the masses will have to those who don’t play by the rules (and believe me they don’t), and how vocal they will be about it (so that the ruling elite will actually notice and worry).
The “tolerance” was ignorance.
Now that people are learning the facts of the high cost of illegals people are increasingly intolerant.
(Social disintegration, high medical, educational costs, welfare, food stamps, section 8 housing, extra police, judges, 30% in prisons, high crime on Americans, molest, rape, iliteracy, translation services, etc etc etc breaking the bank including using hospital emergency rooms as primary care facilities and it goes on).
Those high costs you reference are simply the high costs of our government. It’s not the illegals’ fault that we live in a socialist state.
The middle class Joe Soccer Moms are the ones who support the welfare state the most. I’m glad they will get hosed in the housing bubble as well as taxation.
The middle class Joe Soccer Moms are the ones who support the welfare state the most.
Geez, and I think I’m the only one thinkin’ this shit. Whatta a great blog!
Chicote That is not true. If we said “no” to illegals, we could still have these benefits. Also, I am a citizen but I have never used these benefits. Just because they are there does not necessarily mean they will be used.
It is rather ironic that we spend more on tax dollars on e-room primary health care than it would cost to just provide some level of universal health care.
But nobody is going to convince you guys to let go of your liberal/socialist boogeyman. Gotta have someone to blame for your lot in life dontcha?
Funny, I live in Seattle which is about as “liberal” as berkley, and all the liberals here want is for government to spend the taxes it already collects on helping people more rather than war profiteer who blow people up.
And for government to stay out of people’s private lives.
But hey, as long as you have your demon to wrestle with at night…
Never met this “liberal” you guys keep talking about.
It is rather ironic that we spend more on tax dollars on e-room primary health care than it would cost to just provide some level of universal health care.
But nobody is going to convince you guys to let go of your liberal/socialist boogeyman. Gotta have someone to blame for your lot in life dontcha?
Funny, I live in Seattle which is about as “liberal” as berkley, and all the liberals here want is for government to spend the taxes it already collects on helping people more rather than war profiteer who blow people up.
And for government to stay out of people’s private lives.
But hey, as long as you have your demon to wrestle with at night…
Never met this “liberal” you guys keep talking about. All the soccer moms I know all vote republican.
One thing we might agree on - I won’t shed a tear when their property values drop.
Funny, I remember hearing this “world is gonna end” rap somewhere else. It was several years ago … started with a “Y” … had something to do with the millennium … oh well, it’ll come back to me.
Y2K was a real problem with IT. The reason it did not happen is because huge teams of folks (myself included) worked very hard for a few years leading up to the date transition and averted it. Can the same thing happen for housing?
Huh?? Wrong analogy.
A much better analogy is to fiber optic cable. Too much of it helped to crash the telephony sector in the tech stock debacle. And too many new homes will sink the housing market, no matter what teams of folks do behind the scenes to avert the situation.
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“Michael Nighan couldn’t believe his eyes. As Global Crossing’s North America director of regulatory affairs, one of Nighan’s tasks was to review all of the startup telco’s marketing and sales material. But what confused him in late 1999 was a map of Global Crossing’s network that showed a fiber-optic loop around the continent of Africa. “What’s this?” asked Nighan. He was told it was Africa One, an undersea broadband cable that Global Crossing planned to build for a group of telecom carriers. “But I said it didn’t belong on a map of our network because one, it doesn’t exist, and two, even if it did exist, it wouldn’t belong to us,” says Nighan, who left Global Crossing last November. The response Nighan got was, “Gary wants it there.” So it stayed on the map.” - Fortune Magazine,”Global Crossing: The Emperor of Greed” - June 24, 2002
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“Gary” being Gary Winnick.
My elders (God rest their souls) yammered on about how America was going to hell-in-a-hand-basket. Think it was Plato or maybe Socates who said every generation thinks the one behind them is inferior. I’m no different .. I don’t trust folks covered with tats and pierced in places I can’t even imagine. Ever notice how many of them there are? (bunches) Very few of them are at the top of the economic scale of their peer group (unless entertainers or sportsmen/women). Home ownership isn’t on their radar screen. Don’t think it ever will be. Hmmmm, try to imagine the society this group forms in their in old age — it isn’t a pretty picture. WAIT!!! I’m hearing my father say this about the wild van loads of hippies — I think most of them are pretty mainstream now accept for a few hardcore dudes and dudettes in tie dye and peace signs living in small enclaves here and there (Veneta OR; Arcata, CA, ect.) Oh NO … I’ve become my father!!!!!!
Ya can cut your hair…pretty hard to dispense of a gallon of needled ink in your arms, or get rid of the scars from all the pins and bones you put in your nose and lip.
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The media’s doom-and-gloom economic pronouncements about lackluster holiday spending is an annual tradition. “Worst Holiday Shopping Season Expected In Years” is always repeated year after year regardless of reality. Same goes for “Crime Rate Highest in Years”.
Except that it’s about numbers. These are FBI crime stats. And mostly the press has been all about touting decreases in crime over the years. This is a new trend that bears much thoughtful watching.
Ignore the troll.
ditto
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anybody who doesn’t agree with you three kooks is a troll.
Not just anybody. You specifically. My recollection is of a media constantly spewing about how GOOD sales numbers will be every year.
Anyone who points out that Gekko is a troll must be a kook, silly.
it is funny you mention crime, i am obviously not shocked by crime as i have lived in ny for all my 35 years but of late there has been quite a spike in robbery, and there are countless bank hold ups daily, now they just pass a note and usually get away with under a grand or so (al capone they ain’t)
and just yesterday in queens there was a home invasion and the only thing taken was a playstation 3 console??????
long jail terms for a $600 video game system? wtf?
but in these parts people get shot for nonsense
even for the big city crime definatley seems on the rise
but we are setting records for tourist travel, mostly europeans
with their hugely valuable euro’s
Something from H.G. Wells:
History is a race between education and catastrophe.
I am trying to find this link on gawker — read it a couple of days ago — from a Park Sloper’s blog on how he got robbed at knifepoint recently -and how the detectives told him they were seeing an uptick in this sort of crime. A friend I know witnessed a gang of subway muggers in action firsthand last month–both crimes occurred mid-afternoon -something I haven’t heard happen in a very long while. It does feel different here lately…
“There are basically three modes of earning income”:
Earn it
Steal it
Beg for it
4. Luck into it
(Buy a house back in 1998…)
Note that the crime stats are as cooked as the economic stats. For example, if you are carjacked, robbed, and murdered, only the most serious crime is actually recorded. For political reasons, most big-city police departments substantially under-report criminal acts, while many victims don’t even bother to report crimes against them due to a justified lack of faith in the criminal-justice system.
It really makes me angry how our politicians are selling out our country and jobs, without a care to how it will effect us. For instance, there are tons of underclass folks who have to work somewhere to make a livable wage…but the elites take it away. I hate what they are doing to our country. While they are protected in their walled in communities, far away from the realities of life, we all have to deal with it. And as for the liberals who want “everyone to go to college”…please…not everyone has the capacity to go to college. We need job for every JOe and Jane, not everyone can be a professional in that sense.
Take it one step farther…
WFT are you suppose to do with all the illegals on the lowest wrung of the ladder is what I want to know?
US goin’ 3rd world…and in only a generation, my, my…
“My life is being destroyed,” said Zagami, of the financial crunch he’s now facing. “I was trying to live the American dream and now I’m getting killed.”
Sounds like it was everybodys fault but his.
I guess Ben will post it later today, but I couldn’t help being irritated with the headline on p. 3 of today’s WSJ: “End of Housing Slump Seems to be Drawing Nigh.” The evidence? Mortgage applications the highest in several months, plus, yesterday’s slight uptick in new home sales. Plenty of Deniability in the article itself. “It all depends on blah blah blah…IF blah blah blah…BUT blah blah blah” Yawn. I am amazed they were able to find an “economist” to say the worst may be behind us. Economist not named Lereah. Formerly of Fannie Mae.
And of course no mention that new houses are being built at a much greater rate than they are being sold.
http://www.bloomberg.com/apps/news?pid=20601039&sid=aEMGTIycjgH4&refer=home
Housing Bears May Just Have It Right for 2007
In a Nov. 27 comment, Rosenberg notes that in addition to the record 4.3 million residential units for sale as of October, there were 1.95 million home completions, the 12th-highest month since 1979. Units under construction were through the roof as well. Rather than seeing supply dwindle and prices start to firm up in early 2007, Rosenberg says “it could be a year before the reduction in starts begins to put a meaningful dent into the inventory backlog.”
John Mauldin, an investment adviser and frequent contributor to Investors Insight, a financial-data publisher, throws an extra log on the fire. According to Mauldin, even the current projection of housing sales may be overstated and thus the existing supply of homes greater than what is reported in the official data. The reason is that the Census Bureau, one of the Commerce Department’s statistical agencies, fails to account for cancellations in home sales contracts. Cancellations ran as high as 40 percent for some major homebuilding firms last quarter.
“it could be a year before the reduction in starts begins to put a meaningful dent into the inventory backlog.’’
Does anyone expect builders to let their new homes shrivel on the vine rather than selling them at a loss, the way that grape growers do when a supply glut pushes prices down to a level where it does not pay off to sell them?
On a related note, I have great news for homeowners who until recently were using home equity ATM withdrawals to buy expensive wine. Thanks to a grape glut, the quality of Two Buck Chuck should be very impressive next year.
http://www.forbes.com/business/global/2006/0724/051.html
My descent into winoville 2007 continues unabated.
Thanks GS
Ignoring all the sobering housing market facts (ballooning inventory, high cancellations, subprime defaults, lender exits, and so on), does’nt CONKEY have a sense of economic history?
It’s only been ~15 months from the peak. Has the housing market really bottomed already? I was under the impression 3-4 years minimum is historic norm for this to occur.
Your impression is supported by the findings of this report (not to mention David Lereah’s own August 2006 powerpoint presentation, which he cleverly entitled “Reality Check”).
Sorry to keep posting this repeatedly, but I want to make sure that everyone on the planet who seeks quality information about how housing busts have historically played out before has a chance to see the evidence, instead of taking the MSM ‘experts’ at their word.
(Of course this time is “different,” though I am still awaiting the reasons…)
————————————————————————————-
WHEN BUBBLES BURST. Stock market booms and busts are a recurrent … Sources: Thomson Financial Worldscope database; and IMF staff calculations. …
http://www.imf.org/external/pubs/ft/weo/2003/01/pdf/chapter2.pdf
It of course differs based on the particular cycle and particular market. But then there’s the sideways silent killer where prices don’t change much but the value of money does over time. That can last for MORE than 3-4 years.
Same old same old.
The elite is attempting to use its outlet, the media, to “soften the landing” as th RE bust was in full tilt. They’re trying to hold back the damn that broke.
They seem to subscribe to the untested theory that a slow, painful death is preferrable to a swift coup de grace (like in the chicken clip).
Here is some news that will help end the housing slump — NOT…
——————————————————————————————–
Mortgage applications topple as rates climb
Activity drops more than 14 percent as 30-year fixed-rate mortgage climbs to 6.12 percent, industry trade group’s weekly index says.
December 27 2006: 9:49 AM EST
NEW YORK (CNNMoney.com) — Mortgage applications fell as interest rates rose across the board, an industry trade group reported Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended Dec. 22 fell 14.2 percent to 555.8, from 647.6 a week earlier. The 30-year fixed-rate mortgage fell to 5.98 percent, its lowest level in 14 months, from 6.13 percent last week. The 30-year fixed-rate mortgage fell to 5.98 percent, its lowest level in 14 months, from 6.13 percent last week.
The 30-year fixed-rate mortgage rose to 6.12 from 6.10 percent last week.
The group’s seasonally adjusted refinance index fell 18.5 percent to 1604.6 from 1968.8 the previous week, and the purchase index decreased 10.6 percent to 390.2 from 436.5 one week earlier.
http://money.cnn.com/2006/12/27/real_estate/mortgage_apps/
For those in the NY/NJ Metro area, the newest edition of Lowball!
http://njrereport.com/index.php/2006/12/27/lowball-december-2006/
MLS Town OLP LP SP % off OLP $ off OLP
2307965 Saddle River Boro $1,999,999 $1,799,000 $800,000 60.0% $1,199,999
2283696 Allamuchy Twp. $439,900 $380,000 $210,000 52.3% $229,900
2288787 Phillipsburg Town $105,000 $65,000 $52,000 50.5% $53,000
2235610 Newark City $249,777 $174,777 $130,000 48.0% $119,777
2255200 Delaware Twp $1,125,000 $699,000 $600,000 46.7% $525,000
2324021 Middlesex Boro $359,000 $309,900 $200,000 44.3% $159,000
2246907 Alexandria Twp $1,125,000 $850,000 $695,000 38.2% $430,000
2256953 Mountainside Boro $675,000 $575,000 $425,000 37.0% $250,000
2292034 Phillipsburg Town $110,000 $85,000 $70,000 36.4% $40,000
2302885 Plainfield City $499,900 $384,900 $320,000 36.0% $179,900
2307626 Elizabeth City $399,900 $329,000 $257,500 35.6% $142,400
Thanks for the data…I found it interesting that the August 2006 haircuts ranged from 10% - 30%, and your latest table shows a range of 25% - 60%.
I’m posting one of your comments because I think it bears repeating:
The goal here is to illustrate the fact that list prices are marketing tools, and sometimes bear no resemblance to the market value of a property. Because most people don’t have access to sales data, they typically use asking prices to gauge the market, a flawed approach. Another goal is to illustrate the variablility between asking and sales prices. Many folks will tend to look at an asking price, and assume a property sold for asking when it goes off the market. A flawed assumption as well.
This is why I no longer follow housingtracker.net. They use asking prices to compute inventory and median price. Their numbers don’t jive with what’s occurring on the street.
“Their numbers don’t jive with what’s occurring on the street”.
You mean JIBE not JIVE.
I don’t think the crime rate has anything to do with the bubble popping. There are a host of issues that cause crime rates to increase, but the main one is idle young men who don’t have parents (particularly fathers) guiding them.
My mother is still a school teacher and she has some horror stories about a cheap area in the far west Houston suburbs where she works. New houses from $80-$90k that until recently were being bought by working middle-class are being bought up en masse and used to house Katrina evacuees. Evidently it’s a profitable business with the Section 8 HUD and other government mad money. My mother says each week between 5-8 kids are arrested at her school. This is a middle school. When it’s common for 12-year-olds to tell a smallish older teacher “F*** you, b****. Get out of my face,” you know the neighborhood has problems.
Unseen, uncaring parents are why we have a growing crime rate. Any other reason is simply a lame excuse.
Of course…
having been convicted of a crime at a young age, these people are effectively excluded from meaningful employment for the rest of their life. Their children will be born to uneducated, unemployed and hopeless parents, leading to the kind of behaviours you speak of above, and another generation of incarceration and joblessness etc. I have recognized for many years that the US is actually two countries overlaying each other. One a first world technological nation, and the other a miserable thrid world nation. Of course, we have to be PC and pretend all is well. And lastly, of course it is the poor and uneducated who have suffered most greatly as a result of illegal immigration, which has pressed down wages and made life that much harder. Our schools do nothing either to help these people get any kind of life skills or trades that may make a difference.
That’s a good way to put it. I have no sympathy for the underclass of thugs (see my post below). Their parents had more children than they could afford. This is also why I do not believe in indiscriminately giving charity to the poor. many people in that second class are lazy, on drugs, or have the criminal lifestyle. I donated to the Tsunami relief and to 9/11 relief partly because neither zeroed in on helping druggies/criminals/lazy types, but partly because the victims could not help their predicament and I put myself in their shoes.
What I think is great is that people in the US have a choice to either be in the first layer or the second. I know folks who were born into the second “under tier” and decided it was not the place for them. Through hard work they escaped the normal path and to this day live happily.
This is why I support open borders.
My nephew is idle, and not so young anymore. Had severe ADHD in school and extreme hyperactivity. Graduated from high school and tried college but could not handle it - straight d’s. Now he’s 30. He worked one year in his life. My sister (his mom) basically has him on economic outpatient care. And she does not earn much money herself, but works her tail off 50 hours per week to support her, my nephew, and my niece who is at least in college. My nephew is too nice to go into crime. More likely, after my sister dies, he’s going to be a too-nice street beggar. He does not know how much money his uncle has, nor will he find out. He is the laziest human being I know. Has minor medical problems and probably sever psychological problems. The extended family tried to coax that sister to get counseling for herself and that nephew, but she took it as an insult.
All they know is that I have a roommate and few possessions and a modest Toyota economy car, which is true. My wealth is tied up in stock mutual funds, T-bills, savings bonds, municipal bonds, CDs, money market funds, individual stocks, and precious metal bullion coins. Except for my paper savings bonds and metals, everything else is electronic! My timeshare, in a sense, is electronic. Eventually, when I do get a house, I’ll not raise an issue about it to the relatives who are “will nots” (”will not work”). They made their own choices to not be healthy, to not produce and not save.
Right on. Individual responsibility is still instilled in a few.
Individual responsibility is in most people - until government teaches them that it is not necessary.
Hey Bill-
Did you avoid the “marriage/divorce” trap?????
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prenup!!!
Gekko-
I’m not even sure when I started out down the marriage road the concept of a “pre-nup” even existed.
Such is the evolution of things.
My adage now when it comes to affairs of the heart is “Once bitten, twice shy, baby…”
Get thee to thy lawyer’s office.
“Did you avoid the “marriage/divorce” trap?????”
Barely. The woman was/is honest and all heart and very intelligent (Phd), and would have earned more money than me back in 2000. But the stipulation was that I had to pretend to be her religion, at least through the marriage ceremony, in order to marry her. Sometimes I regret it and miss her. Haven’t met another like her since 2000, only pretentious ones and rip-off artists. One stole $20,000 from me. And that is another reason I purposely made myself fade into the woodwork and look from the average class. I only indulge on vacations these days.
>But the stipulation was that I had to pretend to be her religion, at least through the marriage ceremony, in order to marry her.
Reminds me of a Seinfeld episode: In The Conversion, George falls in love with a girl whose religion is Latvian Orthodox, and then attempts to convert to the religion so that he can be with her.
I think you should call her.
My prayer is my daughter does not meet and fall in love with Bill in Phoenix!
We get in a bad depression (on the way, 2010-2015) and you would dream your daughter meets a guy like me.
Italics off?
Today is my 10th wedding anniversary. I’m off to buy a nice piece of fish so we can have a romantic candle-lit dinner at home and celebrate.
Some of us actually do manage to fall in love with the right person and NOT get divorced when the going gets rough. We have had our share of hard times, but we got through them.
Good for you, fiat!
IMHO, people end up in the marriage/divorce trap because they are chasing the wrong things.
Bill has stated on a number of occasions that he expects his mate to look a certain way (very fit and attractive). No wonder he keeps hitting on the wrong women. Has no clue as to what makes a successful marriage.
From one happily married person to another…may you and your wife enjoy many more “decade” anniversaries!!! Enjoy!
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roomate? life is too short to have a roomate. especially if you’re older than 30.
True. This was only transitory. I was helping out a relative. I will be renting the entire place January 1 and I will be very happy to get the space I need!
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nice. the older you get, the more set you get in your ways!
Oh no, having a roommate post age 30 can be a boatload of fun, especially when your housemate postponed all that wild $hit you do when you’re young ’til after she got divorced at age 40-something.
Please, people, get your craziness out of your system when it’s age-appropriate!
Have you been trying to persuade these folks to get counseling or something? Even advice might help. It may be that nothing works, but if you sit by providing nothing but commentary as they flush themselves down the drain then you may also in some sense be avoiding responsibility in favor of the easy path. I’d dare point out that some of the richest shmucks in this whole country are also stupid, emotionally disturbed, lazy, and useless, but that doesn’t seem to have stopped them.
Mole Man, how dare you insult me! Oops, I’m not one of the richest shmucks in the country. I recognized the rest of the description, though! I know you meant me! az_lender = 1 of 2 all-time dumbest Hrv grad
I donno about that one. Lots of politicans go to Ivy League, and I think they may have you beat, hands down, on the stupid level.
You mean like MR. Dupont driving around his estate in an army tank?
Whoa — you must’ve bought that ‘49 Dodge new, to remember that one!
That is because the highest paid and best rewarded trait in our world as it currently stands is charisma. Those with Charisma go into Sales and politics, sometimes law - need I say more?
“Have you been trying to persuade these folks to get counseling or something? Even advice might help.”
Hey MoleMan, we have given advice until we were blue in the face. My father and mother gave and gave and gave to that sister and her children until death. My father offered to pay for any medical help. Listen. All that was on deaf ears. When you reach a certain age, past 21, no one can really decide for you. It is an individual right to refuse association with anyone (including medical practioners) if you don’t want to associate with them. Good Day.
“My nephew is idle, and not so young anymore.”
Maybe the military would have cleaned up his act; cooperate and graduate.
It is not that crime caused the “pop” of the bubble, it is question of how a slumping economy (which seems to be happening because of popped housing/credit bubbles) affects crime. See front-page article just yesterday in washpost about how immigrants can’t find work anymore in housing construction. Jobs are being lost every day — immigrants and non immigrants- and the more the bubble pops, the more desperate the situation will become.
I’d like to believe that a large unemployed population, in a market where credit is tightening, and services are shrinking, where people feel hopeless, won’t contribute to a higher crime rate, but history tells a long tale otherwise. NYC in the 1970s was not about bad parenting, my friend.
And regardless of cause, if crime increases in a neighborhood, property values will decrease.
Hey, just check out recent events in France…
You are absolutely right, housegeek.
We are also experiencing rising crime here in San Diego. Two cops were shot in just one week (Long Beach, LA County and Oceanside, SD County). One died. Both happened during “routine” traffic stops. Very sad, and a sign of what’s to come…
Heres one onforeclosures rising in Wisconsin:
http://www.jsonline.com/story/index.aspx?id=546801
‘”Families’ incomes did not keep pace with everything else that was happening, and the final victim was the houses,” said Kathryn Crumpton, manager of the non-profit Consumer Credit Counseling Services of Greater Milwaukee. “I tell them that they are being held hostage by their mortgage payment. It’s just way more than they can afford.”
Oh those poor victims, being held hostage by their mortgage payment — the one they signed up for.
“…the final victim was the houses…”
The houses were victims? Is this a family named House and a capitalization error? Fluffy Newspeak.
ATA: Truck tonnage plummets 3.6% in November from October’s 1.9% decline, down 8.8% from 11/05, biggest YOY decline since 2000:
http://tinyurl.com/yzuynr
This is pretty interesting as an economic barometer.
To a certain extent, I think trucking has been a replacement for good paying manufacturing jobs over the past few years. But I don’t have any stats to back me up.
I agree that it serves as a good barometer.
“November 2006 marked the single worst month for for-hire truck tonnage since the last recession,” said ATA Chief Economist Bob Costello.”
Not so good when you get a month like this in November, a month you would think would be busy as hell with stores stocking up for the holidays.
And I also agree with you that trucking jobs may have picked up some of the lost manufacturing jobs.
Shipping is definately a great Barometer.
I cannot help but notice how the index “shoots up” every holiday season. Yet this year, it is doing the opposite. In fact, every other year on that graph except for 2006 has a surge in trucking for the holidays.
No wonder we could hire a trucker for a drive that included Christmas day. Yes, we paid a premium, but last year no one would take what we were willing to offer. Hmmm…
Note: trucking is usually an indicator of the next quarters economy. (More trucks are required to ship components than the finished product.)
Neil
You can pull in $70k per year easily running cross country runs. The hard part is finding people willing to be away from their families for so long. Personally, if I was only a high school graduate, I would take one of these jobs in a heart beat.
As I remember, though the report was maybe 10 years ago, long-haul trucking is either the most dangerous non-military occupation in America, or way up there.
Interesting link, Win — thanks.
heh. The lead story on wfaa .com (and probably the Dallas Morning News if I can find who has it) is about Mortgage fraud. The more the MSM shouts about it the better I guess, even if some of those needing punishing (lenders, etc) will skate on by.
Not on the snooze page. They’re more interested in the guy who is gonna be DA tossing out all the prosecutors in the office. Can’t wait to see how that shakes out.
But I’d bet you that DFW is one of the top five locations for mortgate fraud in the U.S.
testing
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Laci Peterson’s house being sold again
POSTED: 9:30 p.m. EST, December 27, 2006
FRESNO, California (AP) — The house on a quiet, tree-lined Modesto street where police believe Scott Peterson killed his pregnant wife, Laci, is being sold again for nearly $350,000, a real estate agent said Wednesday.
The current owner, Gerry Roberts, bought the 1949 bungalow-style house last year for $390,000 and has been trying to sell it for five months.
His lender threatened to foreclose on him earlier this month before the couple made their offer December 19, Olson said.
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I’m sorry, but i would not want to live in a house where a murder was committed - especially an infamous one. i don’t care about the price. alright, maybe if it was on the beach and free i’d consider it!
You are tuning into this drama late. This character bought the house hoping that the murder would draw attention and bids to his flip. Some older stories actually have juicy quotes about how his hairbrained scheme with that house have ruined his life. Don’t ever buy a property you can’t bear to be stuck with. This might be worth staying tuned to. I bet the guy BKs and maybe freaks out in some big way. Bleh.
This kind of transaction, selling at a loss after trying to flip, has got to be occurring all the time in California nowadays, but this doesn’t make the news except for the Peterson name.
Good to see a flipper getting what he deserves though.
It would be neat if another murder ends up being committed in that house.
What life looks like when not everything always goes up!
“I am no longer proud.
I have no romantic notions about being poor. I’m not nobler than others, and I’m not a victim. But I am one minor medical emergency away from welfare.
Simply put, I’m in survival mode.”
“My take-home pay is about $660 a month. At $310, my mortgage takes the biggest chunk of that. Phone and Internet cost $70. Heat in winter is usually more than $100 — it’s Montana, after all. Water runs $41 a month. The car takes $127. So, just about every penny is gone even before I buy gasoline or food for myself and the dogs.
Since I’m in the hole every month, I dip into my small savings to pay the difference, plus things like car insurance.
There is no room for error.”
“When I think about buying something, I think about how many hours I have to work to pay for it. That’s a sobering thought.”
http://articles.moneycentral.msn.com/SavingandDebt/LearnToBudget/IMake650AnHourAmIPoor.aspx
internet?
food for the dogs?
Good to see somebody else caught that
I wonder if she could have saved more money while she was still employed at her former income?
no longer define myself by what I do for a living. On the flip side, I won’t base my identity on my income.
hehehe…scads of her more affluent female contemporaries need to learn “the lesson”.
A friend of my brother’s over the holiday season had an gal he met on the i-net get up from the table they were sitting at in a restaurant and leave in a huff, when he told her he earned only $40k in his current job.
I confess am anxiously waitin’ for the guillotine to fall on all these hordes of self-righteous $85k per year females employed in tenured special ed; counseling; and the host of other touchy-feely, namby-pamby parasitic public education jobs, which all cater to the chronic f*ck-ups. in life.
Sounds like your friend dodged a bullet with that girl. Who wants a partner that would leave you at the first sign of trouble? I would have asked her to pay for half of the meal on her way out.
Why someone taking home $660/month (minimum wage?) felt entitled to own a house is a mystery for the ages. Equally baffling is why any bank would issue a mortgage to such a person.
She bought the house before here reversal of fortune.
This article highlights exactly why those people who think it’s a good idea to buy a cheap place in the hinterlands need to plan VERY carefully. The size of the job base in those areas is so much smaller than it doesn’t take a lot to push you into a situation like the one this woman encountered — she lost her professional job and was completely unable to replace it without relocating.
Living in a high-density area will cost more, but you will at least have a larger pool of jobs to fall back on if yours goes away.
Here’s the paragraph John might have included in his post, to clarify things in an instant:
“But finding a rental seemed nearly impossible because I have three dogs, and after two weeks of campground living, my boss fired me, telling me my living situation was “bad for business.” I sold off my household goods — everything from a sofa to pots and pans — and drove back to small-town Montana.”
In other words, she kissed off a good job for her three dogs. I love dogs, but I would find them good homes and suck it up before I’d do what she did. It’s her free choice, to be sure, but I’m not sympathetic beyond the substantial pain of parting with beloved pets.
“What do you want, and what are you willing to trade for it?”
Dogs should be considered just like children… if you can’t afford them, you shouldn’t have them. Hell, there ought to be stiff qualifications, tests & licenses for either!
Site for tracking Countrywide REOs. I counted 360 foreclosed properties just in Calf, about $175 million at 400-500k per pop.
http://www.countrywide.com/purchase/f_reo.asp
YIKES! had to check out Colorado after all the articles lately… it is bad.
That was interesting (the Calif listings of C’wide REO’s). Large numbers in SD & Sac, the rest sort of dotted around.
I am pretty sure Countrywide drastically understates their REOs on that page. Countrywide foreclosed on my neighbor a couple of years ago, but the house was never listed. I even called their REO department to inquire but just got a runaround. The house was sold about 8 months later to a flipper buddy of Countrywide’s local listing agent.
Russ — thanks for the link.
Albrt — a poster here noted, maybe a year ago, that in the S&L bust the great majority of early good deals went to cronies of the lending insiders. No reason to believe it will be different this time — we’ll pretty much have to wait until they’ve taken their full measure first.
Nice site- thankyou!
Hey HD74MAN,
Any thoughts on the next 6 - 12 months of activity for the Essex County/Boston North single family home market?
Thanks.
Pen
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My prediction? More Pain.
Penn-
I just saw a list for the top residential ten sales in Boxford for ‘06.
which is swank inland northshore.
One sale at $1.2mil/1 @ a million even. The rest were in the low to mid-sixes. I was pretty surprised at the numbers. I think $100k on average has been easily shaved off from peak levels.
However:
I regard the area as totally schizophrenic.
Despite $100k haircuts, the northshore is still a haven for old money, and Greatest Gen/older Boomers who got in before the price explosions attendant to the tech boom in the 80’s.
Seller’s still believe they can wait the “collapse” out.
My guess is you might see another 10/12% let out of the balloon from peak. ‘06 value losses statewide were like 13%. Of course much will depend on interest rates.
So at the moment you still are only gettin’ in with big bucks which have to made in Beantown.
There is absolutely zilch for local jobs to support the area’s overall cost of living.
However, right now with a stagnant, disinterested older populace, legislative reps from other regions of the state are stickin’ it to the constituents via roadway tolls and the lack of appropriation funds for improving infrastructure.
The place in my opinion is absolutely stuck in the mud.
All of this will have an impact on the person who has “got” to sell.
And I guess eventually the comp’s will show a declining market.
Personally, I see no reconcilation between quality of life and the cost to live here. I would much prefer to be elsewhere.
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looks like they got Jobs - i hope they nail him to the cross. Wall Street is a rigged game! i’m selling all my stocks and putting my money in the mattress!
Apple board didn’t OK options - report
7:06am: Company granted Steve Jobs 7.5 million options without board approval, then faked documents to show a board meeting happened, says report.
i’m selling all my stocks and putting my money in the mattress!
Just make sure it’s not one of those Tempurpedic jobs. You get more stuffing capacity when you can pull out the box springs and pack the greenbacks into the mattress shell.
Remember, no smoking in bed, though.
You’ll have less to worry about if you convert it to gold before storing in the mattress.
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i was just kidding, gold bug.
Don’t take anything trolls say at face value.
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Didn’t I try to convince you not to own any stocks?
“i hope they nail him to the cross.’
To avert the crisis “they” need to nail at least 100,000 Crooks to the cross in a hurry all across America.
Jas
I repeat, don’t take anything trolls say at face value.
existing home sales
0.6% increase the crash is over
that is mtm number
david liar is praising the news
What’s the 95% confidence band on that 0.6%? I’m guessing it might be something like plus or minus 5%?
Anybody know anything about the St. Louis market? (potential job reloc there and then the question arises, good time to buy given they will cover all my closing costs?)
Ford’s Former Home Languishes on the Market
http://www.washingtonpost.com/wp-dyn/content/article/2006/12/27/AR2006122701709.html
The modest two-story colonial in Alexandria has all the trappings of an ordinary home: the pink bathroom, the Magic Chef oven, a couple of fireplaces. But 514 Crown View Dr. also boasts some signs, both subtle and overt, that indicate its unusual status in U.S. history.
Neighbors talk of the steel rods placed underneath the driveway to support the limos. A previous tenant speaks about the countless telephone lines installed in the basement and attic used by the Secret Service.
But a gold-lettered National Park Service sign affixed to the right of the front door says it all:
PRESIDENT GERALD R. FORD, JR. RESIDENCE.
The death of the nation’s 38th president has focused public attention on his time in the White House. But some spotlight has also fallen on a little-known, decidedly humdrum neighborhood (about 15 minutes south of 1600 Pennsylvania Ave.), where Ford lived for nearly 20 years as a Michigan congressman, vice president and — for 10 whole days before moving into the White House — as president.
Mostly everything about the place appears serviceable and decently appointed (with a swimming pool out back, to boot), but the property spans less than a quarter-acre, a remarkable home simply because it is so unremarkable. It stands in humble (almost painfully humble) contrast with the mansion made available to vice presidents in 1974 in the tony Massachusetts Avenue Heights neighborhood in Northwest Washington.
Ford was the first vice president eligible to live in the house on the grounds of the U.S. Naval Observatory, but he became president before renovations were completed. Ford’s vice president, Nelson Rockefeller, used the house mainly to entertain. The first full-time residents were Walter and Joan Mondale, who took up residence in 1977. Every vice president since has lived there.
Javad Khakbaz, who is the president of an Iranian English-language newspaper company, has tried to find someone to take it off his hands since September and is suffering the same indignity laid upon just about every other seller in the Washington area: No one’s buying.
Khakbaz is reluctant to discuss the home’s plight — he has dropped the original price of $1.05 million to $999,000 — but his real estate agent, Joan Dixon, is blunt: “We’ve had a couple people interested in it, but they wanted to lowball the price,” she said yesterday, showing the home not to prospective buyers but to a bunch of curious reporters. “It’s a wonderful family home. It has four bedrooms, two full bathrooms and three half-bathrooms . . . even if one of them is pink.”
But what might appear to be normal about the home and neighborhood is not. The Abbruzzese family at 515 Crown View Dr. proudly showcases a copper plaque above their garage, given to them by members of the Fourth Estate whom they permitted to camp out on their front lawn while Ford was across the street doing neighborly things, like helping run the country, or his family, depending.
The Abbruzzeses, Democrats, forged a gentle bond with their powerful neighbors across the road.
“When it was Betty’s birthday, or it was their anniversary, he was out of town and I invited her to dinner with some neighbors,” Louise Abbruzzese recalled yesterday. “But she called me and said he was coming home early and I said, ‘That’s fine, he can come.’ I was cooking a rib roast. He liked beef. He liked it rare.”
But in the years since Ford departed Crown View Drive in 1974, the home never found a longtime resident. It changed hands twice, Khakbaz said, and neighbors speak with a calibrated air of decorum about the itinerant nature of its inhabitants.
“It’s a hard house to sell because it’s been a rental for a long time,” said Jill McCaffrey, 63, who lives next door to the Ford home with her husband, retired four-star Army Gen. Barry McCaffrey. “Let’s just leave it at that.”
One of those renters, Brewster Thackeray, 37, now a senior project manager for AARP, recalled yesterday how he first found the place back in 1996. He was 27 and had just broken up with his live-in girlfriend and didn’t want to pay the rent at their Cleveland Park apartment on his own. Serendipitously, he stumbled across an ad for the former president’s house.
“It was super cool,” said Thackeray, who was with the American Trucking Associations at the time. “I had found a picture of Gerald Ford washing dishes in his sink, but there I was using that very same sink next to the same oven next to that same knotty pine paneling on the walls.”
Thackeray was so impressed that he wrote the Fords — and Ford wrote him and his roommates back, two letters and a signed photograph. “You have our very best wishes as current occupants of the home we built and loved,” one of Ford’s letters said. “We were proud of it when we moved in March 1955. Thanks for enjoying it also.”
And enjoy it Thackeray and friends did. The presidential refrigerator was converted into a “kegorator.” And they had parties, though not necessarily of the black-tie, state dinner variety.
“The best party we had was a toga party,” he said. “People came in togas and hung around the pool.”
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zero - nice article. thanks for posting.
You’ve got to look at the photo in the actual article. It’s a nice, undistinguished ’50s tract home. The absurdity of wanting a ~1 million dollars is emblematic of the bubble that we’re in.
Is Jobs going buh-buy?
And on a related note, what about all the other innocent CEOs who unwittingly got caught up in the options postdating scandal?
——————————————————————————————–
David Callaway
DAVID CALLAWAY
Apple without Steve Jobs
Commentary: What’s it worth to you?
By David Callaway, MarketWatch
Last Update: 8:56 AM ET Dec 28, 2006
SAN FRANCISCO (MarketWatch) — Shareholders of Apple Computer Inc. put down their holiday iPod nanos for a moment this week and glimpsed a Christmas yet to come without Steve Jobs — and they didn’t like what they saw.
An unconfirmed report in a legal newspaper that said Jobs had retained his own legal counsel amid the ongoing investigation into Apple’s use of backdated options triggered a 5% drop in Apple shares (AAPL : Apple Computer, Inc News , chart, profile, more Last: 80.08-1.44-1.77%
9:54am 12/28/2006) within minutes after trading started Wednesday. Indeed, the story on MarketWatch reporting the drop leapfrogged all other stories on the site to become the most-read piece less than 20 minutes after it was published.
this apple thing is typical of ceo crap
although they have an excellent product line
with great sales, this is just more corporate greed
i hope the stcok tanks il buy it in the 50’s
You’ll catch a falling knife if you buy it in the 50s. That puppy has to revert to below 10 to get back to fundamental value (or else inflation is lots higher than recently reported
)
gracias gs
i have a friend who bought 10000 shares at 17 like 10 years ago and i told her to sell when it hit low 90’s recently
Below 10? That would give it a P/E of 3. It’s one of the best positioned tech stocks (for growth). Why would you make that claim?
Recent history may repeat itself. And I think IPods are overpriced at $150, as well as the rest of their product line. Maybe the rest of the planet will wake up to this fact when HELOC money really dries up.
http://www.marketwatch.com/tools/quotes/intchart.asp?symb=AAPL&siteid=mktw&time=20&freq=1&comp=&compidx=aaaaa%7E0&compind=&uf=0&ma=&maval=&lf=1&lf2=&lf3=&type=2&size=1&txtstyle=&style=&submitted=true&intflavor=basic&origurl=%2Ftools%2Fquotes%2Fintchart.asp
Product line is seriously overrated. I bought an iMac about a year and a half ago. Fortunately, because I did not have any recent experience with Macs, I decided to buy the extended warranty. It has been out of service more than it has been in service. When they replaced the burnt up motherboard they also installed a cooling fan that sounds like a military surplus dehavilland turboprop.
Nice not having to worry so much about malware, though.
this apple thing is typical of ceo crap
although they have an excellent product line
with great sales, this is just more corporate greed
i hope the stcok tanks il buy it in the 50’s
It seems very unfair to single out Jobs. Lots of CEOs seem to be using stochastic options embezzlement strategies to steal from their companies. It seems fairly safe to assume the 29% estimate reported in the MSM is on the low end of reality…
“Will there be more? Slightly more than 2,000 public companies, or 29 percent of those in the United States that give stock options to executives, have timing issues, said Erik Lie, an associate professor of finance at the University of Iowa, and Randall Heron, an Indiana University associate finance professor. Their research last year helped focus attention on a widespread pattern of conduct.”
http://seattlepi.nwsource.com/business/297346_stockoptions27.html
Single out Jobs? Several CEOs have lost their jobs in the recent scandal for the same thing Jobs did. It seems to me that Jobs is getting special (positive) consideration.
It is kind of sad because Jobs insisted on unusually strict accounting policies and this appears to have happened in part from bad advice from CFO Fred. How can you not trust a CFO named Fred? This is all very exciting, but might I suggest that unless the courts actually decide something this isn’t really the place for hot CEO soap opera. Seriously, if Larry Ellison were going down in flames that might be a housing issue because Larry has many incredible properties, but Jobs mainly lives in a modest Palo Alto home and has a few other properties. Apple itself has hit products and a vast cash reserve, so the general way it and other Silicon Valley tech companies relate to the overheated Bay Area housing market is not going to change.
Seriously, there are other, better places to discuss hot CEO drama.
In retrospect, this may prove to be a form of plunge protection. If Jobs goes, Apple’s share price will do like it did in 2000 again, only from a much higher pinnacle this time. All high profile US corporate stocks currently qualify for plunge protection.
http://www.marketwatch.com/tools/quotes/intchart.asp?symb=AAPL&siteid=mktw&time=20&freq=1&comp=&compidx=aaaaa%7E0&compind=&uf=0&ma=&maval=&lf=1&lf2=&lf3=&type=2&size=1&txtstyle=&style=&submitted=true&intflavor=basic&origurl=%2Ftools%2Fquotes%2Fintchart.asp
The WSJ ran a front page article yesterday on the options scam. I was quite impressed the journalists had the courage to state in plain English that CEOs were using postdating of options to “steal.” But as I have pointed out before, the best forms of theft are poorly understood, widely utilized and difficult to prove in court.
Sorry I don’t have electronic access, but in case anyone is interested, here is a link:
http://online.wsj.com/google_login.html?url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB116718927302760228.html%3Fmod%3Dgooglenews_wsj
stock tanks
sorry for double posting
Don’t know about stocks but
Yields sure are up! 10Y 4.69%
2 yr 99 27/32 -4/32 4.82 +0.04
5 yr 99 3/32 -9/32 4.70 +0.06
10 yr 99 9/32 -15/32 4.71 +0.06
30 yr 94 23/32 -29/32 4.83 +0.06
At todays pace the inverted yield curve will soon be reverted
Yesterday some pundits were commenting in the MSM about the effect of higher gas prices on the housing market. Just wait until mortgage interest rates adjust to reflect the sell-off in the T-bond market that is currently underway…
not seeing rate cuts anytime soon-unlkess you want 250 euro
hey gs any advice on where to park some cash?
in money market now (tax exempt) but looking for
a little higher yield on the conservative side
I have no advice to offer. Ask Gekko.
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mgnyc - “there’s no free lunch”. with greater returns comes greater risk. if you want conservative, stick with your tax-free money market.
swiss franc mm paying 1.25% at everbank- roflow !
At least it doesn’t have the risk of USD depreciation (directly). If I was going to park some cash that would be worth considering. You also have it out of the reach of the US government.
Not so sure. “The Swiss franc has suffered devaluation only once, on 27 September 1936 during the Great Depression, when the currency was devalued by 30% following the devaluations of the British pound, U.S. dollar and French franc.”
http://en.wikipedia.org/wiki/Swiss_franc
>You also have it out of the reach of the US government.
some of you guys are out of control.
Right Gekko. The government would never confiscate wealth (remember gold confiscation?) or impose currency controls or devalue the USD… Just keep all your eggs in the S&P. Hey, it went up .2% in Euro terms last year.
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You set up your portfolio based on probabilities. there is a very low probability of your scenario happening - just like an asteroid destroying the earth or the second coming in my lifetime. i will stick to my plan and my strategic asset allocation.
we can’t export or melt down pennies or nickels, that could just be the taste of things to come.
Extremely low probability of what? The government has confiscated wealth in the past, so we know that can happen. We also know the USD has devalued 95% in the past 80 years. There is an extremely low probability that your S&P bet is a winner. S&P return was beaten this year by emerging markets, precious metals, Europe…pretty much everything, Gekko.
Las Vegas
http://www.reviewjournal.com/lvrj_home/2006/Dec-28-Thu-2006/business/11654095.html
Funny stuff. Homebuilder calling the bottom and someone says they will get to a 60-day absorption rate in spring 2007. Let’s see, there were 2800 home sales in November…and there are about 25,000 homes listed in Las Vegas. You just need to sell about 19,000 homes in the next couple months, at over $300k per house to get to that absorption rate. That would be $5.7 billion dollars worth of real estate to sell. Or maybe he is counting on a wall of fire burning down large sections of the city. Either way.
Here’s my update on the existing home sales report just out from the National Association of Realtors. Also available at my blog … which will have a chart or two up shortly –
http://interestrateroundup.blogspot.com
* Sales rose 0.6% on the month vs. forecasts for a 0.8% decline. The sales rate came in at 6.28 million units vs. 6.24 million a month earlier. But it’s down 10.7% from a year earlier (7.03 million units in 11/05).
* Inventory dropped a bit – 1% to 3.82 million units from 3.854 million units in October. That’s a 7.3 month supply at the current sales rate, just off the cycle peak of 7.4 months in October.
* Prices dropped again. The median price of all existing homes (condos + single family + co-ops) slipped to $218,000 in November from $219,000 in October and $225,000 a year ago. On a percentage basis, single-family only home prices dropped at a rate of about 3.6%. That’s the second-biggest decline ever, behind last month’s 4.2% drop.
My thoughts on these numbers …
Like new home sales yesterday, existing home sales bounced in November. I expected this given the dip in mortgage rates we’ve seen lately. But are these numbers really all that good? I’d argue no, when you look at the big picture. Consider …
- The sales rate is basically going nowhere, up a miniscule 1.1% from the September low and well off the high (-13.6%) of 7.27 million units in June 2005. That’s not exactly a rip-roaring rally.
- Inventories? Yes, they’re down 1.1% from the July cycle peak of 3.86 million units. But when you consider the supply of homes for sale skyrocketed 108% from the pre-boom 2001 low of 1.59 million units through the July peak, that 1%-ish decline doesn’t look so impressive.
- That’s not all, either. It is absolutely normal and customary for for-sale inventory to stabilize or decline late in the year. People who don’t sell their homes during the peak spring and summer selling season often pull those homes from the market for the holidays. Then they re-list early in the following year.
You see that seasonal pattern time and time again. It happened in the boom years of 2001 … 2002 … 2003 … and 2004. Even in 2005, when the market had already started topping out, inventory levels stabilized late in the year, before surging again in early 2006. I expect supply to start rising again after the first of the year, and set a new cycle high by spring 2007.
There is simply no getting around a few basic facts:
1) While sales aren’t falling sharply anymore, they’re not improving much, either.
2) Supply is still at astronomically high levels and …
3) Homes remain relatively unaffordable, despite the recent decline we’ve seen in mortgage rates and home prices. It’s going to take bigger price concessions … more incentives … and most importantly, lots of TIME to work off these conditions. In other words, 2007 should be another weak year for the housing market.
Higher volume on lower prices is not bullish. If it had been higher volume with higher prices, that would have been bullish.
The blip in volume is probaly just some dumb money that beleives the hype about being a buyers market and the market bottoming out.
Wait till the spring surge in inventory and the coming ARM’s adjustments.
With the economy showing some continuing strength, a rate decress any time soon is less likely, and an increase is even possible.
You know, the NAR really didn’t run all that many of those bogus “buy now” ads. Maybe they used most of the $40 million to actually buy houses. That might produce about a 1% volume blip.
One minor correction/update to the inventory stats:
- Inventories? Yes, they’re down 1.1% from the July cycle peak of 3.86 million units. But when you consider the supply of homes for sale skyrocketed 117% from the pre-boom 2001 low of 1.77 million units through the July peak, that 1%-ish decline doesn’t look so impressive.
Mike_in_Fl,
Thank You! Again!
Vmaxer - You have a serious disconnect. When all of these houses are sitting on the market with no offers - no one will be buying stuff at Home Depot, Best Buy, Circuit City, etc. Therefore the GDP will drop further. We are headed into a severe recession or Depression. The Fed will not be raising rates they will be cutting rates.
Not so sure — do you know what happens to the long-term T-bond yield if the Fed overspikes? For a hint, scroll down to have a look at how the green curve is lurching up from the orange curve:
http://www.bloomberg.com/markets/rates/index.html
Off topic- Ran into a guy who works for Home Depot and is the builder point of contact. Plywood is no 40% of last years cost and he said he would have to sell $1 million a month to make his bonus from last year after all the cutbacks at HD.
He said he just hopes he has a job next year.
I ran into a Home Depot floor covering manager about 6 months ago. He just purchased a $500,000 home for 0% down, bragging about how the builder paid all the closing costs, provide S/S appliances and a big screen TV. He did not even want a new home, just stopped by to see what they had. Unfortunately, the sale price contract of his old house did not appraise ($35,000 short) and his wife refused to drop the price. So add another $600/mon negative to go with his $4200/mon house payment. $4800/mon before he even gets out of bed. The Home Depot in Lincoln (Sacramento, CA MSA) is like a ghost town. Hmmmm.
the sale price contract of his old house did not appraise ($35,000 short) and his wife refused to drop the price.
Sounds a smart pair, LMFAO…I’ll bet the medicine cabinet is loaded with Ma-loxx.
DD - thanks for the anecdote. I file these away for conversations with potential builders.
The stock market seems to be struggling mightily to escape the efforts of the PPT to defy fundamentals.
http://www.marketwatch.com/tools/marketsummary/
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Help! Home for sale - the Otts
The housing slump has made moving on up more difficult for this Wisconsin couple.
By Les Christie, CNNMoney.com staff wrriter
December 28 2006: 2:15 PM EST
NEW YORK(CNNMoney.com) — The drive to improve your family’s well being is a strong one, and Mike and Mary Ott thought they had a good plan to do it: They would sell the mobile home they owned outside Montello, Wisconsin, and buy a house in town.
Well, they bought the house they wanted — but they didn’t sell the mobile home. Now, thanks to the housing slump, they have two homes, only one of which they can really afford.
http://money.cnn.com/2006/12/28/real_estate/help_home_for_sale_Otts/index.htm?postversion=2006122814
The housing bears have it right !
http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_sperling&sid=aEMGTIycjgH4#
Please ignore - just want to see what these things do
cite
em
codestrong