“An Accident Waiting To Happen”
The Boston Globe reports from Massachusetts. “Massachusetts Secretary of State William F. Galvin said yesterday his staff has demanded documents from two Wall Street firms over their recommendations on subprime lenders such as New Century Financial Corp. of California, questioning whether analysts remained too positive on the faltering companies to prop up other financial relationships.”
“Yesterday, Galvin said he has also subpoenaed documents from UBS Securities LLC and Bear Stearns & Co. concerning their research on New Century and other firms. In an interview, Galvin noted analysts for both Wall Street firms had upgraded their recommendations on New Century at key points since February even as the California lender’s woes piled up and it said it would restate earnings.”
“One goal of the probe, he said, is to see whether other factors could have influenced the analysts’ actions, such as investment banking relationships or the dealings of certain hedge funds with the companies. Both UBS and Bear Stearns were part of a 2003 settlement with Galvin and other regulators in which 10 firms promised to avoid future conflicts.”
“But the case of New Century and others now suggests the terms of that deal haven’t been met, he said. ‘Our instincts were right in the past. We’ll see if they’re right this time,’ he said.”
From Reuters. “‘We want to know if there were any conflicts. Were there relationships, investment banking relationships? Did the brokerage company have a financial position in the company? Were there hedge fund clients that might have had those,’ Galvin said.”
“He said Massachusetts had been hurt by foreclosures on subprime lender mortgages and that the investigation had some urgency to it. ‘This is having an effect on the marketplace right now, so we want to make sure that we move on as rapidly as possible,’ he said.”
“In Massachusetts, where housing prices notched double-digit growth between 1995 and 2004 in a red-hot market, foreclosure filings surged 70 percent to 19,487 homeowners last year, as single-family home prices fell for the first time since 1993.”
“The Federal Reserve Bank of Boston blames subprime loans, saying they accounted for more than two-thirds of the state’s foreclosure filings in the third quarter of 2006, even though they made up just 12 percent of all mortgages.”
The Boston Herald. “The subprime-mortgage market teetered on the brink of collapse yesterday, threatening everyone from Wall Street investors to Massachusetts home buyers who have bad credit.”
“The state Division of Banks banned subprime giant New Century Financial Corp. from writing new mortgages in Massachusetts after the firm disclosed problems meeting financial obligations. Officials also ordered New Century to have other lenders take over any Bay State mortgages the firm was already working on.”
“‘We are forbidding them from taking any new loan applications and ordering them to place (all incomplete mortgages) with other lenders,’ Banking Commissioner Steven Antonakes said.”
“A source familiar with the situation said yesterday’s order affects 450 to 600 Bay State loans already in the pipeline. The person, who spoke on condition of anonymity, said bankers worked over the weekend to find new lenders for these loans. But the source said about 100 of the riskiest mortgages might not find takers, leaving some home buyers without financing.”
“Somerville real estate broker Stephen Bremis said that, in the past two weeks, lenders have stopped approving no-money-down loans for people with weak credit. He said banks are also requiring private mortgage insurance on many subprime loans.”
“But Bremis actually endorses such moves. He said giving no-money-down mortgages to people with bad credit ‘was an accident waiting to happen.’”
“Massachusetts said it was coordinating its ‘cease and desist’ order with several other states, including New York, New Jersey and New Hampshire. ‘There probably will be others either today or tomorrow,’ Massachusetts Banking Commissioner Steven Antonakes told Reuters.”
“The order applies to three New Century subsidiaries — New Century Mortgage Corporation, Home 123 Corporation and New Century Credit Corporation.”
“Antonakes said in a statement the action was prompted by serious concerns about New Century’s finances after the firm on Monday said that all its lenders had canceled their lines of credit and it does not have enough cash to repay its own creditors.”
“The banking commission also issued a cease and desist order against Brandon, Florida-based Apex Financial Group Inc. after it failed to disclose three enforcement actions by other states.”
“It issued the same order against Garden City, New York-based Old Commonwealth Mortgage LLC after its owner pled guilty to a felony charge.”
The Record from New Jersey. “Bergen County mortgage banker David Sadek was riding high a year and a half ago, serving sushi and shish kebab to investment-banking clients aboard his yacht A Loan at Sea.”
“It was ‘a good time to be in the mortgage business,’ he told The Record in an interview. But in the second half of 2006, the business went quickly downhill.”
“Amid rising defaults by borrowers, wholesale lenders cut off Sadek’s funding last fall. Sadek quietly closed 18 lending offices in New York, New Jersey, Florida, Pennsylvania, California and Washington, firing all but about a dozen of the company’s 110 employees, said William Dimin, an Englewood attorney. Dimin is representing the company in civil suits to recover bad debt.”
“‘Overexpansion in a very bad market,’ Dimin said last week. ‘That’s what caused the downfall of the company.’”
“‘It’s a big shakeout,” said David Akre, co-chief executive officer of a New York City-based real estate investment trust. ‘For the most part, it’s loose underwriting standards,’ Akre said of the subprime lenders that have closed down. ‘Under competitive pressure, underwriting took a back seat to common sense. They didn’t want their volume to drop off.’”
“Meanwhile, loan brokers throughout New Jersey are reporting that their funding sources have tightened credit in recent months in response to rising defaults. ‘Our lenders are giving us much more stricter guidelines,’ said Michael Laheny, a broker in Paramus.”
“The banking industry is trying to fend off increased regulation of mortgage lenders being called for by lawmakers and consumer groups concerned about people losing their homes. ‘Market discipline in this industry is swift, can be severe, and is more effective at changing lending practices than any potential changes in regulation,’ said Doug Duncan, the Mortgage Bankers Association’s chief economist.”
‘Market discipline in this industry is swift, can be severe, and is more effective at changing lending practices than any potential changes in regulation,’
although I agree with this for the SHORT TERM, one nagging point keeps coming to my mind: how do we prevent this in the future.
clearly lenders have not learned their lessons of the past (see S&L crisis, only 20 years ago).
so although the mantra of the “invisible hand” and “market efficiency” sound persuasive, in the end they don’t really work for more than a short period of time in our current society.
It seems our current society is GO GO GO and has the memory of a goldfish.
I’m not always a huge fan of regulation, but those anti-regulation folks must also understand that APPROPRIATE regulations are needed to keep confidence in the market. THat leads to the question: “are current mortgage regulations appropriate and sufficient, and should they be expanded?”
just some thoughts.
‘although I agree with this for the SHORT TERM, one nagging point keeps coming to my mind: how do we prevent this in the future.’
It can not be prevented…..the media has programed folks with the entitlement idea - you deserve it now, don’t wait, now is the time, while you are young.
You must repay whatever is borrowed at some point , at most they are simply delaying the payment for instant gratification.
I agree, it can’t be prevented. As a renter, I have a hard time seeing how people who “bought” homes using subprime loans actually considered themselves homeowners in the first place. They’re worse off than renters. Don’t believe the hype, dummies.
You are so right.
“It can not be prevented”
I disagree somewhat. If for example we had a law that said “all purchases must have 20% down” then RE could never have reached these heights.
not saying that’s a wise law to have, just saying that our situation would be quite different if everybody was FORCED to bring 20% to the table.
The sheeple would have started bidding higher and higher out of entitlement, but it would be restricted to a price low enough so they could bring 20% to the table.
Similarly, life would be different if we abolished Fannie and Freddie and made them reopen as different entities. They would lose their “implicit” guarantee.
or even more important, if we abolished fractional reserve lending system (which in my opinion has been MORE devastating to our life than fiat)
I always thought something was fishy with our RE debacle. And I felt that something was wrong. But I didn’t feel we were in a true bubble until my good friend with an income of $36,000/yr bought a condo for $450,000 with 0 down and an IO ARM.
It was the ability of the foolish to do that that propelled this from RE bubble to mania IMO.
HIC,
The only thing that regulating loan terms will do is relocate human stupidity to some other unregulated activity.
Both the housing bubble and stock bubbles are symptoms a generation that never got whacked over the head by history.
Agreed, future bubbles cannot possibly be prevented given the current social and economic paradigms. The best we can all do is lower our tax profiles as much as possible.
Doubly-agreed, especially given the direction and incentives coming from the Fed. Too much authority to mislead the creightons we call bankers.
dd
The word is cretins–it comes from the French, cretiens, meaning Christians. A reflection of the anti-clerical fervor during the Revolution (theirs, not ours).
IMO when it comes to loans you have to have regulations for the protection of the investors and the homeowners . Many people have been cheated by the incorrect ratings on these junk loans and the loans didn’t make any sense at all, in fact the loans were absurb .Yes ,I would like regulations against making loans based on real estate going up to every Tom ,Dick and Mary that doesn’t qualify who wants to get into a hyped up speculation market .The property tax base has to be based on a stable market with stable appraisals .
I’m discusted with the hyped up RE market that catered to overbuilding and selling to speculators and low down uqualified profit seekers or fear-based first time buyers who believed the REIC .The market should of contracted in 2002 based on true market competition and it was just a matter of keeping the party going . Alot of people are going to lose money because of this fake market and in some instances it will be pension funds and savers in banks that will lose .
The financial world we live in today has to be regulated because there are to many stupid greedy people in the world that will bring everybody down given half the chance .The great experiment failed with easy money ,just as it did in 1929 with margin buying on stocks .
I see it as fairly simple. Regulate to the point of good common sense. Decent credit, savings and a history of honoring your obligations + a significant personal stake in the property+ affordable house= a deal
Am I the only one who is wondering why home loans were ever offered to the bad credit crowd in the first place?
Due to high returns with a fairly safe collateral as long as the rising housing prices supported the ponzi refinance scheme. As long as borrowers could refinance to repay the loan, or sell the home, the loans were pretty much failsafe.
That ponzi scheme is now unraveling, hence the return to the normal lending mode from the ponzi mode.
Yes, they should be expanded. Current regulations are insufficient.
What would satisfy me, and I suspect, many others?
Easy, when I come to the table to buy a home with cash and I am NOT competing with 20(twenty) 100% financing “buyers” (or 104% + for that matter) I’ll be satisfied.
Then, and only then, will I know we have sanity.
Right now is like trying to be a “clean” bodybuilder when everyone else is using steriods. Worst of all–the steriods are out and the open and accepted.
You can either play the game and destroy yourself along with everyone else, or simply remove yourself from the game.
I’m like you. I’ve opted out of the game altogether. Once lending standards have sufficiently tightened, subject to prices making sense, I might enter the fray. In the meantime, I’m saving more and more of a down every month–and sleeping quite well debt free.
Right now is like trying to be a “clean” bodybuilder when everyone else is using steriods. Worst of all–the steriods are out and the open and accepted.
You can either play the game and destroy yourself along with everyone else, or simply remove yourself from the game.
Very well put. Slim, this is a better answer than I gave above.
one nagging point keeps coming to my mind: how do we prevent this in the future.
THE ONLY sure way;
IS TO STOP HIRING IDIOT MORONS IN THE FIRST PLACE, Those mallable, bangable, cute little chicky poos, and gamer guys clueless airheads, and so easy to mold them into good scammers.
Without “THE MORON GENERATION” being hired at every turn, this could not have happend.
Also it helps to Eliminate as many ADULTS from The Hiring process as you can. Make sure No adult are in HR, so the Paris Hilton types will hire their own kind!!!!
We sure did DUMB DOWN our great country.
It’s kinda hard to prevent malfeasance when it is sold as benevolent affordability.
Right ,you said it mrkMaven Fl . You post states exactly how the industry sold this con game .
“It seems our current society is GO GO GO and has the memory of a goldfish.”
Every generation needs to make its own mistakes in order for the lesson to stick. The spending on “toys”, the extravagant parties at sub-prime mortgage companies, etc., were all seen during the dot-com boom. Each generation likes to think “it’s different this time”. If you add too much regulation, at some point the new generation will feel “held back by the man”, and get rid of the guidelines…until the next bubble bursts.
60’s mantra: Don’t trust anybody over 30
00’s mantra: Don’t trust anybody under 30
The intergenerational flamewar has been done to death, but this is an important point for framing the political response to the Depression of ‘08. As someone who straddles the two generations, I think I want to retire to Canada and be rid of both the Boomers and the Xers.
Tulkinghorn-
Rent me the other side your duplex.
and if hd74man doesn’t show up, rent it to me (I’m 43 today, decidedly not a Boomer, because I’ve been living in their shadow all my life. They got all the fun, and wrecked it all for their kids.)
Hey, I’m under 30 … and I’m a saver!
I don’t think we can afford the luxury of those kind of lessons you speak of .People will abuse easy money ,it’s a given .People are childlike filled with dreams and given the chance will go for it if they have a sweet talking salesperson leading them down the path . Let people earn a loan like it has been in prior lending cycles like you should earn every thing in life . I can’t tell you how many times my own kids wanted me to just give them money for some easy get rich quick scheme they dreamed up . I would say ,”have fun saving the money “.
“People are childlike filled with dreams and given the chance will go for it if they have a sweet talking salesperson leading them down the path .”
And that is why, after you are gone (dead), they will just get rid of the guidelines yet again. You really can’t force people to not be stupid. I agree the reasonable guidelines are a good thing; I just don’t think that they will last further than the next mania. After all, as I said, “it’s different this time”.
I tell my kids “you can do whatever you want with your money, but first you have to earn it”. My oldest daughter (8) wants to open a savings account because she’s tired of p*ssing it away on little trinkets; she wants to save for an I-Pod (itself a trinket, but at least she’s saving and working for it).
My wife and I both have stories from our childhood regarding that one thing that we needed to save money for. Not an iPod, but similar concept–a luxury item. We both were fortunate enough to have parents that made us earn and save the money–and I think we have a greater appreciation for savings because of it.
Even if you overpay your kids for minor chores, at least it gives them the sense that you need to work for money–there is no free lunch.
“How do we prevent this in the future?”
The government has a vested interest in the boom, it’s only the bust they are concerned about. In a democracy there isn’t much way to prevent what almost everyone wants. That’s the biggest weakness in our system. Without individual restraint and morals the whole system collapses.
Absolutely climber! Democracy and government regulation are no substitute for a conscience. The idea that a government made of people who have the same weaknesses, fears, and foibles can do better than the people who compose the market is preposterous. At least the market is playing with it’s own money.
I agree; “retention” is definitely an issue. Speculative excesses occur throughout history, and even though the details vary in each case, the fundamentals are the same. The housing bubble is not all that different from the Tulip Bubble, the South Sea Bubble, etc. The argument that markets “learn” from past mistakes is fairly weak.
In addition, there is the issue of collateral damage. Yes, the market will “correct” itself, but what collateral damage will it inflict in the process? You could argue that the market would “weed out” companies that poison their own town’s water supply because it eventually becomes unprofitable for them, but after the market correction puts those companies out of business, the public still bears the cost of cleaning up their mess. Just because the market “corrects” itself does not make everything OK.
The Boston Herald. “The subprime-mortgage market teetered on the brink of collapse yesterday, threatening everyone from Wall Street investors to Massachusetts home buyers who have bad credit.”
Too late the messenger.
All the canaries in the mine are long since dead.
Fookin’ hell to pay now.
Prevent what? Prevent stupid people from being exploited? Why would you want to do that. This entire problem was caused by sheltering people from reality for so long. Let the homeless flood the streets to serve as examples for those would be careless with their finances, otherwise this will just be repeated in 10 years.
“But Bremis actually endorses such moves. He said giving no-money-down mortgages to people with bad credit ‘was an accident waiting to happen.’”
Really? I’m shocked, I tell you, shocked!
Really, who’d a thunk it, that lending huge sums to deadbeats is a risky business model.
Though I am now amused by those who are calling for “APPROPRIATE regulations to keep confidence in the market” since these seem to be the same folks who want to ignore immigration laws and profit thereby.
spike, Dodd’s bailout would probably help out many illegal immigrants who bought homes with some exotic mortgage. Frosts my patootie big time.
Hmmm… My patootie feels a certain chill as well.
Bremis has been the buyer’s agent for about a dozen of my friends over the past few years. He’s one of the “good guys” in realty; getting rid of the current madness will actually make his job much easier. To the best of my knowledge, he’s steered all my friends into homes they can afford. At the very least, none of them has had a forclosure or even a threat of one.
Cause and effect. The same cheerleading noise that ran home prices beyond affordability is now crying for their fall. Just as no RE analyst seemed to understand that easy credit was causing skyrocketing prices, they will be stunned (Stunned, I tell you!) when the restriction of these toxic loans eliminate 75-80% of first-time buyers. The door is slamming shut on American real estate, and a few months we’ll all feel the draft.
“But Bremis actually endorses such moves. He said giving no-money-down mortgages to people with bad credit ‘was an accident waiting to happen.’”
I bet it did not stop him selling people those houses!
Please see my comment above; I have a number of friends who’ve worked with him, and nothing could be further from the truth. He’s one of the “good guys.” He’s worked mostly as a buyer’s agent, and he’s a very reputable one.
“The Federal Reserve Bank of Boston blames subprime loans, saying they accounted for more than two-thirds of the state’s foreclosure filings in the third quarter of 2006, even though they made up just 12 percent of all mortgages.”
There is going to be hell of a recall on these products. Some people will need to provide answers to questions like: How did your firm expect granny to make the $3,500 monthly pmt with $2,500 monthly income? Ahhh! There is a scandal brewing.
Subprime is now a bad word.
Lending to people with a track record of flaking on repayment has always been considered a bad idea. Especially when it is clear they have no money to repay the loans.
Then how do you explain AAA rated treasuries?
It is different when you have a giant printing press at your disposal…
greatest story never told.
“Lending to people with a track record of flaking on repayment has always been considered a bad idea.”
Across the mortgage lending spectrum from borrowers to CDO/MBS investors, subprime is now a bad word. Anything with the word subprime attached to is being dumped including subprime borrowers, subprime originators, subprime loan packagers, packaged subprime products, subprime industry champions, and so on. IOW, subprime is revolting as described in Kindleberger’s Manias, Panics, and Crashes:
‘Sixth, at the peak some insiders leave the market, there is “financial distress” and a bankruptcy or the revelation of a swindle leads to the final stage; the rush for liquidity. The panic (or “revulsion”) feeds itself until prices become so low that people are tempted to once again go into less liquid assets….”
Of course regulation was not necessary until after it was too late. Talk about closing the barn door after the horses are long gone.
I have to admit, that bearish as I am on the entire RE market the speed with with the credit markets is falling apart is amazing.
Picture the perfect storm on the horizon. Hundreds of thousands, perhaps millions of foreclosures on the market at once, and no money to lend for anyone to buy them. I am not sure Lenders have to luxury of allowing properties to go unsold for years while waiting for the market to rebound.
We (the bloggers here) pridicted this would happen two years ago. Lending would be tightened, invtentory would soar, prices would crash. It amazes me that so called *professionals* are just realizing this now.
It’s inevitable. The perfect storm you forecast is going to set off a deflationary spiral in Real Estate. The subprimer group is suddenly either locked in or locked out. They cannot sell nor can they buy. Pretty soon, as prices fall, the only people able to transact will be those with substantial equity OR savings.
I strongly predict this is not only a “subprime” problem, but a problem for anyone regardless of credit score who borrowed more than they could afford to repay. Locked out - yes, but I have a great job and a high credit score and have been “locked out” of the San Diego market for at least 4 years now, which is part of the reason my credit score will remain high. I know many around here who have great credit and are indebted upto their eyeballs, with huge resets coming up this year.
“I strongly predict this is not only a “subprime” problem, but a problem for anyone regardless of credit score who borrowed more than they could afford to repay.”
I’m in CA also, and your statement applies to everyone I know who bought in the last few years. Everyone did a piggyback loan, little or nothing down, IO, because that’s the only way they could “afford” to get into the house. Once those payments reset, your FICO score can’t help pay the increase. Everyone was banking on years of 20% appreciation to carry the load.
I’ve been saving and have a huge down payment nest egg.
I can’t wait to kick the stupid owners out of their foreclosed houses right on their asses, kids and all.
Sorry, I have no sympathy for stupid, and arrogant people.
“the only people able to transact will be those with substantial equity OR savings.”
My guess is that they already own and most plan on staying put…especially when things get downright scary.
OK - So Subprime is dead. Any word on Alt-A mortgages? I am still seeing ads all over the place for interest only / option ARM loans. There is a guy on the radio with a new inovative product which can maximize a landlord’s cash flow (probably an option ARM).
Any word on these whether these loans are starting to feel the heat.
Didn’t you see that Pisani single-handedly fixed the subprime problem last night on CNBC??
His comment to the panel was that since 30-year rates are now below 6%, all the sub primers can just refinance into a fixed product - problem solved.
What bugs me is everyone gives him a free pass, they nod their heads, whack each other off some more and move on.
They are so out of touch with reality, they don’t stop to think that less than .1% of sub primers could actually refi at today’s best rates.
What happens to the landlord’s cash flow when the tenants trash the property? And, for fun, let’s say that this trashing happens just as the ARM re-sets…
“But the case of New Century and others now suggests the terms of that deal haven’t been met, he said. ‘Our instincts were right in the past. We’ll see if they’re right this time,’ he said.”
his critics will say he’s suffering Spitzer-syndrome?
I agree with aNYCdj. The moron generation sure can ply those video games, but they don’t have an ounce of common sense. Airheads,
with an entitlement attitude. But, on their behalf, our geneartion created these airheads. With both mom and dad working, we sent them to school, not to learn, but to avoid sitting costs. We made babysitters out of our teachers…We took away the teachers right to discipline them…put them in front of the tv all weekend to entertain them, gave them video games and said go play. Yep, what goes round comes round.
amen….
I see it every day. Narcissism starts in the 3rd grade. Entitlement starts earlier and earlier and is reinforced by their parents. I have no ability to truly discipline a child in my classroom.
Thier appetites as a consumer knows no bounds and their ability to sustain that appetite is limited, because of a lack of social skills, empathy and true academic rigor.
We are raising a generation of weaklings with anger management issues and sense of entitlement.
jct
Balloon Guy, have you ever met my mother? She’s now retired from teaching, but she used to tell me the exact same thing that you just posted.
Then explain my in-laws. Mortgage on the house, mortgage on the motor home, taking seasonal jobs to make ends meet - at age 77.
I suggested selling the motorhome and getting a small camper after they mentioned fuel prices being so high “Can’t…the mortgage on the motor home is substantially more than it’s worth”. They only recently bought the house - with a 30 year mortgage.
And then they gripe about $150/ tube cancer cream. It’s not only the young who can’t discern between nice and necessary. Without the big house in the exclusive gated community and the motor home they’d have plenty left over for medicine.
What a mess. A democracy can’t last when folks can’t make good decisions.
Sure a demoncracy of stupid people can work. Just stop whining about stupid people when they become homeless. Our taxes can pay for tent cities and shanty towns if you must alleviate your guilt. I have no such feelings.
This isn’t King Louie and Marie Antoinette people. These idiots were given access to hundreds of thousands, maybe even millions of dollars and flushed it down the toilet. They are completely responsible for what is happening to them. If you can’t handle money, then you shouldn’t have it. You get to live in a shack on government cheese until you learn to add two numbers. I don’t know what the big deal is.
foreclosures in San Diego: 2 weeks ago were 1,800, today 2,483.
http://www.foreclosure.com/search.html?st=CA&cno=073&z=&tab=f
I started this little project Countrywide Foreclosures,
http://countrywide-foreclosures.blogspot.com
The foreclosures are piling up like crazy. Yesterday’s scan on California was 750, and today’s 841. This is going to get real ugly.
Here in CA the first tax installment is due in April and so are income taxes. No doubt about it the home owner is going to be stress and taxed by check writing time. Delinquent payments should shoot up in May and June.
Your a teacher…
“Why doesn’t the United States of America with a capitalist
system and free enterprise do more to educate our children about economics and personal finance so that they don’t make these idiotic decisions?”
Educate about finances?
Ask yourself this question:
Who owns and runs the financial system in the US?
Uneducated people who attended places like Yale, Harvard…etc…
or educated people who get degrees from community colleges?
idiotic decisions?
Look at the fine print on your credit card and explain it in simple terms to a 12 year old.
Did uneducated financial pencil-heads create that clarity for the benefit of the consumer?
That’s that sort of “word” construction that lends itself to make an informed decision rather than an “educated guess”?
All of this is the most efficient way for a young family to put a roof over their heads?
Teach your students to play monoploy…only rig it so that you can change the rules… at any time… for any purpose… so that you always win. Then they will “learn” something.
Due to emotional cascade saturating normal frequency
thought construction timing patterns the self-editing of grammatical review was inadvertently not validated.
In other words:
“Sorry for the typo’s”
Corrected:
You’re
12-year-old
Idiotic decisions?
In admiration for all the wonderful schoolteachers I had in school, I could not help but feel guilty for submitting my rant in such condition…even after all these years you make me feel guilty.
To think, I was just one click on spell check from not getting caught. Charlie Brown…you’re a blockhead!
It’s not a sexy answer, but as a school teacher and with kids in the public schools, please answer this question for me:
“Why doesn’t the United States of America with a capitalist system and free enterprise do more to educate our children about economics and personal finance so that they don’t make these idiotic decisions?”
My 16 year old wants a car. Of course she wants something next to new. I’ve repeatedly told her that when one is brand new in the job market, one should not expect to drive a car that is of a level of someone who has been working for years. It is so difficult to teach teenagers in these days the concept of delayed gratification.
My answer. Work your two jobs this summer, save every penny you can and I will match your savings up to $2,000… and that is the car you will get. I think it’s more than reasonable.
I’m hoping that this type of training will be a start to her learning that one waits until one can afford an item (ie. a house) before on makes the commitment.
How many who are being foreclosed on in the coming months are learning this lesson for the first time.
jct
As a teacher, you should know your hands are tied. You cannot teach common sense or things which sem important, but must follow the rules set down by the State and Federal Government in this regards. These rules seem to revolve around giant book publishers which in turn pay off our elected officials to force school districts to use thier “copyrighted” material.
Be careful, your teen may show up one day with a $5000 credit card at 20% and a car… But seriously though you are absolutely right.
hotair: You presumme that people will learn a lesson.
My belief is they will blame it on someone else but not themselves. Probably Bush.
And the other side will blame it on Democrats now controlling the House and Senate and not allowing Bush to push through fiscal policy “that would have helped”.
There is going to be plenty of blame to go around–in both the public and private sectors.
How on earth can you attribute the results of our socalized schools on captialism or free enterprise? Public schools are pure socalism. It may work ok in many places (socalism can work on a small scale as long as there’s accountability and responsibility), but it’s still socalism.
It is not in the interests of the controlling elite to have us know the answers to two fundamental questions:
Q1 What is money? (What are the characteristics that distinguish the things we call money from other things, such as blades of grass)
a. Medium of Exchange
b. Store of Value
c. Unit of measure
Q2 What is a dollar?
A dollar is a silver coin with 371.25 grains of fine silver. The so-called “Pieces of Eight,” which is why stock prices, measured in dollars, were divided into eighths, until recent years.
A federal reserve note is something that you exchange for a dollar; it is not a dollar itself. The fed pulled a fast one and convinced us that the paper receipt is the same thing as the dollar itself.
This is very true. There is a knowledge that they need to do more, but most institutions have too much inertia. Oddly enough the Federal Reserve has put quite a bit of resources into education and outreach. You might find some useful materials here. People did work very hard to provide this, and used money that comes from taxes you paid. No miracles yet, but this does seem like at least some tiny measure of progress where it is sorely needed.
Here is the link to the Federal Reserve Economic Education site with resources for teachers. Not an ultimate solution to be sure, but potentially a positive sign and useful resource:
http://www.federalreserveeducation.org/teachers/
“It is so difficult to teach teenagers in these days the concept of delayed gratification.”
You have to start teaching delayed gratification way before they turn teen-age. Some of that teaching will go out the window if your kid hangs out with the kids that seem to get a new toy (cel phone, i-pod, DS/PSP, car) every week, but if you do a good job, they will at least be able to delay gratification more than most kids they hang out with.
Actually, they can see if a child will delay gratification at 18 mo.s old. It’s the ‘one cookie now versus two cookies later’ test. Apparently they did some tests on me as a child and found I preferred the two cookies later. Needless to say, some of my siblings did not.
Upbringing is important (in The Millionaire Next Door they found that Scots were very effective at teaching their children thrift and independence) but sometimes we’re born with different personalities … like my brother the showman. He’ll always make bigger incomes than me, I’m sure, but he’ll probably spend more, too. Mom did do her best to teach him some money sense, and he’s trying, but he doesn’t shift down easily like I do.
Gee, and to think that when I was the teacher’s daughter’s age, my mom offered to buy me a ten-speed bike.
Geez.
Any money I ever got from my dad, I paid 7%.
Even as a teenager.
JCT,
Please see my post…I placed it above your’s…It’s all Lucy’s fault!
I have been a foreclosure specialist apprasier for FHA for many years. One thing is for sure and that is the condition of these foreclosed homes will be less than pristine.
In most cases the folks foreclosed have a hammer party the day they move out and that is they throw hammers through the walls, bust up all of the fixtures, smash glass, steal wiring and switch plates as well as all appliances and anything not nailed down right down to the compressors and air handlers.
They get downright creative with the destruction. You can add the cost of management and maintenance as well as repair to the tab.
This is why you offer them CASH CASH CASH to leave the place with no damages…….
Most landlords are so freaking DUMB in america they NEVER think paying a tenant to move is a good idea…..so rather then paying them $2000 to move peacfully…. they wind up with $10-20,000 in damages…….
Before we were married, my wife bought a house in Moreno Valley, in the early 1980’s. Back then, places like MV were really considered “out there”, an hour’s drive to the o/c, (make that 2 or 3 now) and she told me that initially, the houses were all new and bright and shiney and there was a bit of community pride and within a couple years, the pride was gone and neglect set in.
The Moreno Valleys and Palmdales that were just onesy twosey problem developments on the outer edges of suburbia, 25 years ago, have been joined by bigger, farther away disasters, all over this fair land.
We are modern day descendants of the Anasazi, who endured prolonged droughts in the Southwest, eventually forcing them to leave their real estate holdings and just walk away, around 900 years ago.
Some evidence that the Anasazi had a hand in their own demise. By cutting down trees for framing and firewood, they altered the groundwater holding capacity of the desert, drastically changing the floral/faunal mix. Basically over-developing themselves out of their environment. Sounds errily familiar, doesn’t it?
“Anasazi America” by Stuart, is quite frankly, an amazing book.
You’d be amazed at the many similarities of the ancient ones and us.
Recommended!
Have you read ‘Caddilac Desert’? An incredible book.
One of my favorites…
Should be required reading for anybody contemplating a move to vegas or phoenix~
On a slight tangent, Asphalt Nation by Jane Kay is also illuminating.
This is great–I have to look into it!
I think my skeptical friends will be interested, too–you get really sick of this “wisdom of the ancients” caca. Good to see they (and the French, and the Romans, and the Mayans) were just as stupid (collectively) as we are.
(I have heard that Navajo elders have been quite useful to public health officials in identifying disease vectors (ie rodents) in the SW … I just dispute the claims to magical, intuitive or natural knowledge because they “live closer to the Earth”. Science is the only reliable process for learning new things about Nature.)
(And yes, I know the Navajo are relative ‘newcomers’ to the area … just goes to show that it was simple observation, not magical powers or peyote huffing or whatever, that allowed the elders to identify the problem species.)
This blog is great.
“Why doesn’t the United States of America with a capitalist system and free enterprise do more to educate our children about economics and personal finance so that they don’t make these idiotic decisions?”
============================
WE HAD HOME EC when i was in HS many years ago……. Maybe the Better question is :
Why did we let the Teachers Union DUMB DOWN our kids???????
Why doesnt the Teachers demand this in the school ciriculum?
Why wont the teachers Demand we teach Black kids to read write, and speak ENGLISH not Ghetto?
Imagine a world where kids of all colors can stay out of jail and be financially responsible… RADICAL ideas.
Why arent the teachers stepping up to the plate on these issues?
You’d be hard pressed to convince the founding fathers or an Austrian that America, as it exists today, is free enterprise or capitalist. The public schools are the best example of that, totally socialist. Everyone pays, the feds meddle, the states meddle and the locals try to work around all the meddling.
I honestly can’t speak for the teachers union… I’m not in it. I’m a full time substitute when not flying a hotair balloon.
I can tell you that the testing required by “the no child left behind act” and the new continuing education requirements are leaving most of these people stressed beyond belief.
Not to mention that if you show any sense of “high standards” in academics and behavior, parents are accusing you of child abuse.
jct
I guess that why we wont touch the Rap/ Hip hop crowd.
We need those people to fill up our jails and criminal justice sytem
Imagine all the unemployment associated with Black people reading writing and speaking proper English.
I’ll say it again, the current filthy, Rap and Hip hop music is nothing more then promoting the Ku Klux Klans ideas in a more palitable way.
When I saw my first images of our teenagers wearing fashions, ala what convicted felons wear in prison, I knew we were in the midst of a steep decline.
Convicts, fashion role models.
I like when folks really speak their minds, even if its racist drivel! The so-called “educated” people/experts who led the charge re home-ownership via sub-prime loans may very well get a cell right next to the the “current filthy Rap and Hip-hop” group. Afer all FRAUD played a role in the current events in RE market. Although the FRAUDESTERS do not wear baggy pants, they are FRAUDSTERS none the less. Watch CNBC…and listen to their pitch…who desreves a jail cell more.
And by the way many of us do write and speak ENGLISH, and are able to reason sans racist lens.
I am a person “in the know” about this issue, “the no child left behind act” is the ONLY thing in the past 40 years that has done anything to make schoold districts actually attempt to teach the kids who just passed through before. Yes it is stressfull and not perfect but you cannot argue with the results.
Because you say you’re “in the know about this issue” we’re to take your word for it? I detect more pinocchioisms here.
Gotta support BP here. As an educator and a school board trustee, NCLB may be a stressful, lousy, expensive way to measure achievement rates in students…but after 40 years of bitching and buck-passing about the causes of differential achievement we at least can estimate its results. If NCLB shines a glaring light on these issues, it is worth the pain.
That makes sense and it’s definitely worthwhile… But the mad rantings of idealogues should be disregarded entirely.
“mad rantings”…?
where?
“…questioning whether analysts remained too positive on the faltering companies to prop up other financial relationships.”
Wait… Haven’t we seen this movie before?
These “creative” Buyers, RE Agents, Loan Brokers, HomeDebters and the entire REIC middlemen had NO SKIN in the GAME other than Commissions and GREED.
This RE/Loan Trainwreck WAS NOT an Accident waiting to happen.
It was a DISASTER CONSPIRACY based on GREED and Corruption in which damned near Everyone WAS from the appraisor, local Gov’t’s to the MSM a willing and enabling COLLABORTOR in THIS FRAUD.
This FRAUD is NO ACCIDENT and the MSM lame response is Total BS …MAJOR FRAUDS are ALWAYS WELL PLANNED !
“This FRAUD is NO ACCIDENT”
Sing it, Brothah! Testify!
Don’t forget the government was a willing co conspirator as well. The increasing property taxes were spent with abandon and many of the regulations in the industry were bent or ignored as long as prices (and taxes) were going up.
Shoot, they even ponied up downpayments for some of these disasters in waiting.
In today’s Coloradoan:
“Times are tough for builders these days, especially those building homes for the lower-end market. Coming off a 15-year low for single-family building permits last year, 2007 is off to another sluggish start.
Building permits for new single-family homes dipped to half of what they were last year at this time, according to statistics from the city of Fort Collins building department.”
2006 was a 15 year low and 2007 is half of that so far!!!!!
According to Money magazine, this is supposed to be the Best Place to Live in the US and another publication said it is one of the top 10 for home appreciation over the next 5 years.
Got Jack Daniels?
Atlanta too, they’re ncek n neck
roflow
The moron generation has nothing to do with it…There are morons in all generations (remember the pet rock, or “mood” rings, or how about going crazy over Sinatra in the early years, or appeasing hlaf mad European tyrants, or buying land in Florida on margin in 1925).
If the average IQ is about 100, and the distribution of IQs is like a bell curve, it means there are a lot of dumbasses in any large population. Are these people capable of reading and understanding a mortgage? How about their 1040? How about the small print (”that taketh away”) in an insurance policy? These are complicated legal documents, and one could think that some sort of “professional” advice ought to be given.
The problem has been that some, if not many, of the “professionals” in the mortgage industry seem to have forgotten that one has a duty, an obligation as a human and a professional to not take advantage of people.
If there are morons responsible for this, it is the ethical imbeciles who have helped to doom a portion of our society to debt servitude, a portion of our society to monetary losses -and all the resultant anxieties and worries -that could have been avoided had if “professionals” farther up the food chain had shown more strength in the face of pressure to take in more cash, and all of us to a society in which trust has been shaken again in institutions that should be striving to show what is good in humanity, and not doing there best to remind us that we still have animal impulses!
‘Nuf said!
I think that relying on professionals to remember their “obligation as a human” is hoping for a little too much. You would need some motivational mechanism other than money, such as professional esteem/shame, in order to have at least a chance at self-regulation. If anything, we’re moving further and further away from non-monetary motivational mechanisms and towards a model where the only possible reward is money and the only possible punishment is lack of money.
You also have to realize that the call for less regulation is very often fueled by the desire to take advantage of the people who are on the left side of that IQ bell curve. A successful business model does not need to create wealth; it just needs to redistribute wealth in its own favor.
See, this is the whole problem. People have this idea that you should “save” people from themselves. Now we have these morons who have been coddled and think that Bill and Hillary are Mom and Dad.
You need to let people hit bottom before they learn. Americans have been sheltered from reality far too long. Unless there are examples of failure, you know, homeless families in the street, then no one takes any consequences seriously. They think the state is going to rescue them. The proof is the number of airheads who paid 800,000 dollars for average homes in the San Fernando Valley (Los Angeles area). Who in their right mind pays that much for something that was worth 200,000 10 years ago?
Proof? Terry Schiavo had a higher net worth than most Californians, ZERO. How much brain does that take?
“Yesterday, Galvin said he has also subpoenaed documents from UBS Securities LLC and Bear Stearns & Co. concerning their research on New Century and other firms. In an interview, Galvin noted analysts for both Wall Street firms had upgraded their recommendations on New Century at key points since February even as the California lender’s woes piled up and it said it would restate earnings.”
I see no problems ahead for the bozos who baked up this bogus pump-and-dump report on NEW from Bear Stearns. Quattrone showed the world that the punishment for bogus pump-and-dump recommendations from big Wall Street firms is a slap on the wrist…
——————————————————————————-
Quattrone Drops Hints About His Next Move
February 14, 2007, 2:35 pm
Few people know exactly what Frank Quattrone, formerly the sine qua non of technology bankers, is going to do next. Lots of people seem to think it will be big. Mr. Quattrone isn’t telling.
Still, the formerly high-flying Credit Suisse First Boston banker did lay out a few scenarios for the San Jose Mercury News’ Constance Loizos in an e-mail interview.
A private equity fund focused on the technology sector is certainly one possibility that makes sense, he wrote, adding, “I’m open-minded to considering any number of things and wouldn’t rule out any interim possibilities. But I am focused mostly on what the next long-term opportunity will be.’’
http://dealbook.blogs.nytimes.com/2007/02/14/quattrone-drops-hints-about-his-next-move/
Telling article on Yahoo about resetting monthly payments:
WASHINGTON (AFP) - In the heady days of the US real estate boom, it seemed like a safe bet to use her house as collateral for a loan. Today, Sharon Edwardsen risks losing her Staten Island, New York home, trapped by spiraling payments.
Edwardsen, a 47-year-old assistant optician, was tempted to take out a special high-risk loan targeted at people with low credit ratings. Today her monthly repayments have soared to 2,800 dollars, yet she only takes home 1,600 dollars.
She is among 2.2 million people across the US who risk forfeiting their homes by the end of the year as they struggle to meet monthly repayments swollen by rising interest rates, and triggering fears that a financial crisis could sweep US lenders.
http://news.yahoo.com/s/afp/20070314/ts_alt_afp/useconomyproperty_070314133106
Another quote from the article:
“Each time she got into difficulties, her mortgage broker would offer a new deal. From an original loan of 103,000 dollars, she now owes the credit company some 285,000 dollars even though her monthly income has remained the same.
“They took advantage of the fact that I was so desperate that I needed it. I told her (the broker) I had trouble with it. So she said in three months ‘we’re going to do this again. We’re going refinance you again and the money you take out, you going to use it for your mortgage payments,’” Edwardsen said.”
That’s the kind of game playing that will be, thankfully, over with the pop of the bubble.
she’s a victim and she votes !
circus an bread
This article says that “2.2 million people” risk losing their house to foreclosure. Isn’t it 2.2 million households? i.e., there’s more than one person in almost all of those houses. The dislocation of foreclosure would affect everyone in the house including (especially?) the kids.
actually with all the Casey Serins running around it’s probably half that.
Edwardsen is one of the victims that Senators Dodd and Clinton want to make certain are enabled to stay in the homes they cannot afford to buy nor to own.
She could afford the home. Staten Island is the place where assistant opticians live, and her mortgage balance started at $103,000.
She HELOCed hereself out of the home. Others overpaid for the same house they would have been living in anyway.
Summary — in the Northeast and Coastal California there was a price bubble, and people are in the very homes they could afford at prices they can’t afford. In the rest of the country there was a development bubble. It is there that people can’t afford the houses.
The Boston Globe reports from Massachusetts. “Massachusetts Secretary of State William F. Galvin said yesterday his staff has demanded documents from two Wall Street firms over their recommendations on subprime lenders such as New Century Financial Corp. of California, questioning whether analysts remained too positive on the faltering companies to prop up other financial relationships.”
hmmm.. somehow i get the feeling that big money got hosed following these recommendations from the analysts.
got cash?
If the government could lend the subprimes 20% of their mortgage and let them refi @ lower rates into 30 year mortgages and while their at it make it illegal to report any negatives on their credit report I think this whole problem would go away.
The government should simply make subprime loans forgivable. Then buyers with patchy credit could get any kind of home they want, and we would not have to ever worry about affordability again.
I’m calling “Flexpoint Loans” today! Don’t have the number handy but they’re advertising 24/7 on TV up here for the past couple weeks.
No job
No FICO
No tax statements
ETC.
100K loan for @ 120/month was what they said I believe.
For equivalent rent that I’m paying, that ought to put me into an 800K house -as long as I don’t include maintenance, insurance, and property taxes- NICE!
GET ON THIS BAILOUT WAGON before it leaves the scene! !!!Everybody qualifies!!!!
Yes, as long as the people whose retirement was being paid by those sub prime mortgages don’t mind. Yes, that’s the solution. Let the seniors live in cardboard boxes while the stupid 20 somethings get to keep their houses.
send in a check today
make it out to HUD
The government! You mean us loaning the irresponsible, sorry, not my tax dollars. Would you loan them 20% based on their credit history? What ever happened to consequences of ones decisions?
Wrote my Senator today about “no bail outs” Have you? Take action and not just complain or wait for someone else. It will depend on you.
different his time - I remember owning in late 70s early 80’s and RE going up just because inflatio was high
hhhhhhhhhhhhhmmmmmmmmm
Ah the good old days of 70/80 inflation, times were you could inflate your mortgage away. It’s a premise that RE professionals still use today. “Well your mortgage payments are high now but in 3 to 5 years you will be making lots more money and the payments will be manageable.” Ya, right, in today’s low wage growth environment you are lucky to just keep up with inflation.
kckid, you sound like a f**ked borrower–
“If the government could lend the subprimes 20% of their mortgage and let them refi @ lower rates into 30 year mortgages and while their at it make it illegal to report any negatives on their credit report I think this whole problem would go away.”
“I think this whole problem would go away”
“you sound like a f**ked borrower–”
I think it was sarcasm.
Why not give me the same deal?
Gibraltar Mortgage Capital
• Direct Hard-Money Lender
• All 50 States
• Rates Starting at 9.50%
• FICO Down to 400
• Bankruptcy/Foreclosure/Poor Payment History OK
• Max LTV 70%
• Loans from $125,000 to $5 million
• No Seasoning Requirements
I would love to help you out with this deal. Feel free to contact to me.
Danny Bacher
Gibraltar Mortgage Capital
(954) 332-3567
Help is on the way!
“Direct Hard-Money Lender:
as opposed to all the other lenders who lend out soft money?
kckid, sorry, I think you were being sarcastic—-
haven’t had my morning coffee yet, I’m on the West Coast..
Dow down 60 at 9:05 Pacific time. Ouch.
Help! My wife wants to buy a big old house currently listed at $900K (we’re in a fairly wealthy Phila suburb). It was listed early-mid last year at this same price for 6 months with only one offer (less than $700K). The owner pulled it off the market, slapped granite countertops on the 40 y.o. cabinets (oooooh, granite!), put cheap new tile in 2 of the 4r bathrooms, and added central air. He recently re-listed at $30K MORE than last year, and my wife wants to bid somewhere around asking, afraid that someone is going to snatch it from us (as had been done to us in years past during the boom).
I think we should wait to see what the market does for a year or so before upsizing (no talking her out of upsizing), or offer what was offered last year, if only to connvince the seller that his place ain’t worth what he think it is. She thinks I’m cheap, but I say that the house is only worth whatever was bid on it it last year and even less. Thoughts?
google divorce lawyer or psychiatrist in your area.
If she can’t see what’s going on and calls you cheap then I’d go with kckid’s advice.
flamable ?
tell her she has to pay the diff as it goes down
dump her.
If you can’t, find where she’s getting the idea that you’re cheap and cut her off from whatever that source is.
Astute.
Mikey in the PHL burbs, promise me you won’t even think of submitting any offers in this inflated market, at least ’til Oct-Nov of this year. I just got some comps e-mailed to me, the 19010 zip. Is that anywhere near you? I will share with you if it will help.
Your wife is being ridiculous. Surely she can wait another seven months. I agree that certain areas of the Phila. metro are very sticky going down, but prices ARE sliding. Re-listers in my zips are also trying to get 2005 prices. Good luck McTrump Chumps! That train left the station last year.
Man up, Mikey.
What does zillow say about the house’s value? Many houses nosediving in zillow graphs. Maybe visual aid like that would help.
John Uptick
I think this is a great idea. A lot of people — smart people — don’t really get numerical things without seeing them graphed out.
Yep. Them number thangs is hard sometimes.
YO mikey
How much Money does the wifey make????????
Tell he to double her salary by next year and you will glady buy her the house….
Fair is Fair!
Go for it. It’s a good deal. What are you waiting for?
I’m NOT that mikey and thank God she ISN’T MY Wife
Do not make an emotional decision because of a relationship. Her nesting instict and desire to appear favorably in comparison with her peers appears to be taking over. Unfortunately, most love is not unconditional. If you don’t purchase and she leaves, she was meant to go and you will be better off in the long run. Good luck with your decision.
JB
txchick - you are interesting. you always reference my old pals Todd Harrison and John Succo. they are good dudes, but I had to part ways with them for personal reasons. all the best.
Do not make an emotional decision because of a relationship. Her nesting instict and desire to appear favorably in comparison with her peers appears to be taking over. Unfortunately, most love is not unconditional. If you don’t purchase and she leaves, she was meant to go and you will be better off in the long run. Good luck with your decision.
JB
txchick - you are interesting. you always reference my old pals Todd Harrison and John Succo. they are good dudes, but I had to part ways with them for personal reasons. all the best.
I don’t know if this posted or not. can’t seem to figure it out.
In our posting frenzy today we’ve been slowing the server down. It takes a while for the posts to show up, that’s all.
Mike from Philly burbs here again. Don’t know if anyone’s watching this string anymore, but Zillow shows the house at a little over $715K with a range of 200-300K on each side of that; showing it dropping every week. She makes nada, zippo. I don’t think she’s leaving over this - she couldn’t afford to go anywhere anyway. We’re not living in a slum, we have a very nice 2000sf house nicely appointed with all the Ethan Allen (how cheap I am) furniture she wanted.
She just wants a nicer gilded cage, that is all. If you can afford to buy it at 900, let her have today’s 1.2 million house next year for 900. Then she can tell her friends how smart she is, too.
Tell her to read this blog for a week. Or even one day.
I can’t think of anything stupider than to buy a 900K house right now. Unless you guys just won a multi-million dollar lottery, in which case, it’s only money.
Seriously, do people remember what a million dollar home looked like 5 or 10 short years ago? They could be looking like that again soon.
Why are you people trying to convince this guy to not buy?
Dude. Go ahead and buy. Your wife will really love you more when you are broke.
Haven’t hit the lottery; in fact, this would be a big-ass loan. Amazing what the bank will lend. I’ve had five good years in business, but you never know when the bottom is gonna drop. Guess none of us do, but it helps me to sleep knowing that I can handle some down years without risking the roof over my and my family’s heads.
Wait till end of year and revisit. Ask the owner of the house if they are willing to rent it. You would then be able to collect data to see if you can afford it, watch the market for the real price and also assess your own business during the downturn coming.
It’s about time! I have relatives who are appraisers and have been “black-balled” by New Century because they would not inflate their numbers; although requested to do so; amend their reports to take out problems with the properties (although requested to do so); illegally assign appraisal reports, etc. and other ILLEGAL activities which New Century’s Brokers requested. Hopefully, the Justice Department will visit the GOOD appraisers who were victimized by this Company (and others like it) because they are not willing to prostitute themselves to make a number just to get a “deal to go through.” The Mortgage Brokers are to blame for this bubble burst (and the unethical appraisers who just gave them whatever number they wanted to make the deals). Last time it was the Savings & Loans, this time it was bandits bearing deals too good to be true. THey wanted to “make the deal at all costs.” Well, they did and we are stuck with their errors (PA, NJ, Ohio, NH, etc.).