“The Tipping Point Has Passed”
Chicago Business reports from Illinois. “Slumping home sales are showing the first signs of hurting Chicago-area banks, which are reporting an increase in bad construction loans. Problem construction and land development loans by local lenders increased 58% at the end of 2006 to $169.4 million from $107.2 million at the same point in 2005, according to Federal Deposit Insurance Corp. data.”
“The primary culprit, bankers say, is the housing-market contraction, exacerbated by an increase in mortgage defaults and foreclosures. ‘It’s another manifestation of the housing recession we’re in,’ says Paul Kasriel, chief economist at Northern Trust Corp.”
“Sales of new Chicago-area homes fell more than 30% in 2006 from the year before, according to real estate consultant Tracy Cross & Associates Inc.”
“Chicago’s Cole Taylor Bank, which lends to homebuilders in the city and suburbs, has seen fallout. ‘If there are fewer homes being sold, it reduces the demand for your developed lots and undeveloped lots,’ says Robin VanCastle, chief accounting officer of holding company Taylor Capital Group Inc. ‘That’s the first impact.’”
Reuters reports from Michigan. “With bidding stalled on some of the least desirable residences in Detroit’s collapsing housing market, even the fast-talking auctioneer was feeling the stress. ‘Folks, the ground underneath the house goes with it. You do know that, right?’ he offered.”
“Even with the steep discounts on Detroit-area properties, some buyers handed over their deposits with a wince. ‘I’m not sure it’s congratulations,” said Kirk Neal, a 55-year-old auto body shop worker who bought a ranch in the suburb of Oak Park for $34,000. ‘My wife is going to kill me.’”
The Toledo Blade from Ohio. “A Reuters wire story starts with an account of a ‘fast-talking auctioneer’ under pressure to sell a house for which bidding came to a standstill. ‘After selling house after house in the Motor City for less than the $29,000 it costs to buy the average new car, the auctioneer tried a new line: ‘The lumber in the house is worth more than that!’”
“My hair curls because of the regional prevailing wisdom. You do know what that is, right? As Detroit goes, so goes Toledo.”
“I know a guy who sells real estate in this town. His name is Tony Bassett. ‘Here’s what I want to know, Tony: How many houses are for sale in Toledo that are listed under, let’s say, $30,000?”
“So Tony noodled around on his computer with that MLS database, and then I got my answer. ‘I’m coming up with right around almost 300,’ he said. ‘And that’s just in the Toledo Board of Realtors [multilist database]. It doesn’t include people trying to sell by owner, or anything for sale by a bank that’s not using our MLS. So really, it might easily get to 300… [325].’”
“The Board of Realtors, meanwhile, said somewhere close to 3,060 houses are on the market in Toledo - meaning right around 10 percent of the houses up for sale in this city cost less than a run-of-the-mill new car.”
“‘Inventory’s high. There are tons of foreclosures everywhere,’ Tony said. ‘We’re showing [foreclosed] houses in Sylvania, Maumee, Perrysburg, and they’re competing with the regular listings. But that’s everywhere [nationally] too.’”
The Chicago Tribune reports on Ohio. “Cleveland, with a rapidly growing stable of vacant and boarded-up homes, is known for mortgage foreclosures. Between 1,200 and 1,300 foreclosure filings land every month on the desk of Cuyahoga County Treasurer Jim Rokakis –including a recent one for his childhood home, which his family sold years ago and was auctioned off last week for $19,000.”
“Perhaps no place in the Midwest has been hit harder by foreclosures than Cleveland. In Illinois, Cook County reported a total of about 4,260 foreclosure filings in January and February, about 1,700 more than Cuyahoga County, over the same time period. But Cook County, with 5.3 million residents, has roughly four times the population of Cuyahoga County, which includes Cleveland.”
“‘This just empties out the city,’ said Rokakis, who is scheduled to testify Wednesday in Washington before a congressional subcommittee on foreclosure prevention. ‘For a lot of neighborhoods, the tipping point has passed.’”
“Ohio has an estimated $24 billion in subprime loans, and Rokakis said about 40 percent of those could go bad. Rokakis speculated that 30 percent to 40 percent of the mortgage loans in Cleveland are subprime.”
“Council member Anthony Brancatelli estimates that 60 percent to 70 percent of the foreclosures in his ward involve people who tried to manipulate the subprime mortgage system and bought several homes with the intent of renting or quickly selling, or people grasping for their piece of the American Dream, without the financial means of making regular payments.”
The Plain Dealer from Ohio. “You might think the evaporation of high-interest loans is good news for a region where thousands of people have lost their homes to foreclosure. But the timing could not be worse, Cuyahoga County Treasurer Jim Rokakis says.”
“High-interest mortgages are often the only option for people who are rebuilding their credit. If the supply disappears when many houses in Northeast Ohio are vacant and begging for owners, it might cause a glut and depress values for years, Rokakis said.”
“‘Look out below,’ he said. ‘It’s going to get ugly.’”
“Critics, including Rokakis, say sub-prime lenders have fed Northeast Ohio’s foreclosure epidemic by locking people into deals they don’t need or can’t afford.”
That’s one sad story.
Those are plague like numbers.
I agree. I have never been to Ohio, but I feel for those people.
Parts of Ohio are really quite beautiful…My brother in law lives outside of Columbus, and it’s nice there, except in the winter….Of course Columbus is the Capital, and doesn’t have the problems, because of the University there….
I live outside Cincinnati and the economy and housing market are totally different than Cleveland. I’d say Columbus and Cincy are still growing economically, while Cleveland, Toledo, Dayton, Akron/Youngstown are are not.
There are beautiful places to live in Clev. proper and even more in some of the better suburbs. One of the problems with Clev is that the local schools are so bad, no one with children wants to live in the city. Since most people in Ohio have children and leave the city, that leaves only the poor and elderly still living there.
Columbus is a really nice place. I worked the 2004 election there and got to see most of the city and its exurbs. It was great. The city is surprisingly urban. To be sure, it’s a small Midwestern city, but Columbus has a reasonable amount of commerce and is quite sophisticated.
I spent most of my time in the exurbs and they were absolutely wonderful. Housing was affordable, commutes were breathtakingly short (Columbus is small, so a “long” commute from a far-flung exurb into the city takes like 20-25 minutes) and the people were wonderful.
In fact, I wish I was living in Columbus right now. It certainly beats LA in pretty much every way imaginable.
I dont think the snow beats LA.
Columbus used to depend on the University… back in the 70’s. Now, we have a bunch of very large service industry companies with a few manufacturing ones thrown in. Mostly what OSU does now for Columbus is diversify our population and provide an educated local workforce. And the local economy is growing in part because of all the people coming from elsewhere to live here. Want a haircut? Odds are a woman from West Virginia will be doing it. People have been coming here from Toledo for the last 10-15 years, Cleveland less so. Even have a few coworkers from Chicago now.
I just hope to hell that we don’t get a flood of people from CA, especially ones who don’t “get” places east of The Rockies.
ps. Winter did indeed suck here this year.
“In Mahoning County, Youngstown has demolished 500 houses in the last few months, placing the city well on its way toward a goal of knocking down 3,000.”
That’s too bad. Many of these homes had beautiful ornate woodwork in them. Many were left to go to seed over the past decades, only to be replaced by shoddy homes built with crappy materials.
From 12/27/2007 in USA Today:
As older cities shrink, some reinvent themselves
The USA’s population hit 300 million this year and is expected to keep booming, reaching 400 million in about 35 years. Despite this phenomenal growth, many of the nation’s older cities have shrunk. More than half of the 100 most populous cities in 1950 have fewer residents today. About 6 million fewer people live in 16 of the 20 cities that were largest in 1950. Eleven of the 100 largest cities 50 years ago have fewer than 100,000 people today.
…
Many such cities are starting to capitalize on what they still have rather than what they’ve lost — whether it’s historic neighborhoods, cultural amenities or waterfronts. “Their aspirations should be to build on their strengths and to assume that they’re not going to be as big,” says Eugenie Birch, a professor at the University of Pennsylvania who has documented the resurgence of downtowns.
“Cities that measure success by population growth have an outdated view of what success is all about,” says Carol Coletta, head of CEOs for Cities, a non-profit alliance of mayors, executives and other urban leaders based in Chicago.
That group’s research has shown that population growth doesn’t always bring cities wealth. Bakersfield, Calif., grew 35% in the 1990s, the second-fastest gainer; per capita income, however, declined 7%. Las Vegas was No. 1 in population growth but 38th in income growth last decade.
When a city’s growth is buoyed by a boom in construction and service jobs, many of its new residents are lower-income families including immigrants.
“Urban leaders are getting very clear-eyed about these things,” Coletta says. “But they do it in the face of a world that judges them by population growth.”
…
What occurred in U.S. cities over a half-century happened almost overnight in Germany after the fall of the Berlin Wall in 1989. Eastern Germany suffered a net loss of almost 1 million people to western Germany from 1991 to 2004, according to Pallagst, who is German. In 2002, more than 1 million housing units were vacant.
The rapid decline inspired Germany’s Federal Cultural Foundation to launch the Shrinking Cities project. It analyzed Halle/Leipzig in Germany, Manchester/Liverpool in England, Ivanovo in Russia and Detroit. The goal was to develop strategies for eastern Germany, but it unleashed broad interest throughout Europe and parts of Asia, where fertility rates are dropping and populations aging. The discussion went global.
…
“You have to deal with a huge water system that’s serving less people. Same with buildings. You still have to supply them with power, water, sewage.”
…
Youngstown, Ohio, …has fully embraced its shrinkage. The population, now about 83,000, is less than half what it was when the steel industry collapsed in the 1970s.
“You look at the facts and come up with solutions,” chief planner Anthony Kobak says. “The first step the city has come to terms with is being a small city.”
Youngstown approved a 2010 plan. The goal: “A safe, clean, enjoyable, sustainable, attractive city,” Kobak says.
The city long was better known for gritty steel mills than green space. Now that the mills are gone, there is plenty of space. With the help of a grant, Youngstown preserved 260 acres. It’s targeting neighborhoods and redesigning them with the help of residents who stayed.
The city may let homeowners buy abandoned lots next door to create gardens. It’s considering relaxing zoning rules to allow small horse farms or apple orchards. It’s offering incentives for people to move out of abandoned areas.
“If you had three or four square blocks that at one time had 40 homes per block and now have maybe five homes total, we could relocate those people across the street and convert the vacant area into a large city park,” Kobak says. Residents would be living across from a park rather than being surrounded by decrepit homes and lots overgrown with weeds.
When you consider it this way, Youngstown may actually be a city with a great future.
Great post, Brian. I was just discussing this today, about how Tampa and other cities in Florida seem to think they have to be like LA or New York. They want “growth”, Trump Towers, etc. It’s better for a city to just be what it is. Tampa, for example, will never be “world class”. Florida already has that in Miami. Tampa would do best to enhance its laid-back, historical southern port city foundations and clean up the bay. Instead, it has messed things up with all the trash and pseudo-development. I’m hoping Tampa gets into the whole light rail/hydrofoil thing. That will help.
I guess Miami is world-class in many ways, but the other 85% of it is sh@t.
Personally, I would LOVE to live next to a community garden. Or a horse farm. Or an orchard. Great ideas, Youngstown!
I don’t know about a horsefarm. Have you ever been to one? There’s nothing like the smell of horse manure early in the morning. I’ll stick with a park or an apple orchard.
“‘Look out below,’ he said. ‘It’s going to get ugly.’”
Yep. Detroit and Ohio… toast.
Florida? Toast
California? Toast
Pheonix? Toast
Las Vegas? Toast
DC? Toast
Boston? Toast
The NAR is trying the “real estate is local” line. Not when this is happening. Credit crunches are national. Hold on folks.
Sadly, the layoffs are gaining momentum. I now know more people looking for work.
The secondary impacts are happening in so-cal a little faster than even I would have predicted. Then again, its shouldn’t be a shock that Sony is laying off… 
Got popcorn?
Neil
Oxnard is burnt toast….
SOUTH FLORIDA IS ASHES!
Speaking of Sony, here is a link to a digital artist’s forum, in which they discuss Sony’s announced move of the Imageworks jobs from Culver City to New Mexico. The conversations quickly moves to the price of houses and cost of living. Internal migration at the expense of the coasts.
http://forums.cgsociety.org/showthread.php?t=472498
sm_landlord
Thanks! I know lots of this is going on, but its tough to quantify.
Its interesting that New Mexico is proposing a bill for movie studio tax breaks… if enough jobs transfer… expect the flow to continue.
Also, I like that blog… the readers have the rigth idea. Any part of LA is too expensive. Quality of life… not very good here.
Got popcorn?
Neil
pic on yahoomarquee of a house being auctioned in Newton MA
that’s a nice area
“Credit crunches are national.”
The credit-fueled bubble was international, and I expect the ensuing credit crunch will turn out likewise.
touche’
Got popcorn?
Neil
Why is Las Vegas toast? 2 MM people headed to 3 MM. Low taxes. Lots of sun. Housing prices need a 30% haircut, but toast in the same boat as Deriot?
Come on. Vegas is a tourist mecca. It has no high paying jobs. Utility bills in the future and infra-structure costs are going to suck the life out of it. Continued high gas prices will too!
Vegas is toast due to the glut.
Not to mention the condos. Also, in a recession what areas take the worst hit?: Tourist areas.
I do agree Detroit is worse. Maybe it will the worst?
Its only a question of when the cities on my list fall of the lemming cliff, not if.
Got popcorn?
Neil
I used to live in Vegas (2002-06), and IMHO they’ll come out of the bubble better off than a lot of places. The rapid rise in prices there was at least partially driven by fundamentals (50k people/year moving there, many from CA). In absolute terms, it’s still cheap compared to CA, and there’s a thriving tech sector in Vegas paying pretty good wages. Everyone thinks the city revolves around menial jobs at the casinos, but a lot of casino employees can make some serious cash, and the city is diversifying somewhat. Vegas has made a big push to attract tech businesses from California.
It’s still too early to buy, though. 20-30% seems about right.
I think there’s a limit on how much Vegas can eventully get to, housing bubble aside. It’s still a one-trick pony, although I’ll grant that “trick” is travel and tourism in general above and beyone just gambling. People go there to go there, pretty much.
But that’s it — there’s no economic base. No banking, no agriculture, no natural resources, no government, no university that matters, no military, no factories, no distribution center for anything, no big engineering or construction companies doing business with anything outside of Vegas, no Fortune 500 companies (other than one of the hotel chains, maybe), and no history of any of these things. So when the gambling/entertainment industry plateaus, what else is there?
I think I saw a headline recently about Macau eclipsing Vegas in terms of gambling $. Of course, Vegas will always continue to be a big draw, but after its transformation in the 90’s, I would think it would have to plateau at some point.
“Why is Vegas toast?”
Because the price-to-rent ratio there is out of whack. What you can rent for $1200/mo has a $300,000 price tag on it. And there are plenty of rentals available. So what idiot would buy.
I’m working in an unrelated sector, and we are having a very tough quarter. This is an odd transition from last year which was stellar. Another company near us just shut their doors last week. I don’t know what the company can do except cut expenses drastically.
I’m working in an unrelated sector, and we are having a very tough quarter. This is an odd transition from last year which was stellar. Another company near us just shut their doors last week.
What sector or industry do you work?
As re Detroit: Did anyone read today’s WSJ?
Page one, top of the fold:
HITTING A WALL
It is so over with for Detroit. Many of Ford and Chrysler’s suppliers are already in Chapter 11. Others are being propped up by money from the finance divisions of the automakers. They are the walking dead, zombies that are awaiting the silver bullet or the stake through the heart. Michigan is going back to forest land in our lifetimes. Polluted, evil forest land, but forest land nonetheless.
Toast.
I live in Ohio and I can say it’s just not the urban areas being affected but the rural small towns are going down too. They were on the decline anyways but this may be the braking point for towns that have lost manufacturing and small businesses.
From what I’ve seen in my random driving around Ohio (which I do now and then) I think the smallest of the small towns don’t have the tax base to keep going, so they’re either abandoned or merged into townships. The smaller cities, like Urbana, London, Mt Vernon, ones that didn’t depend on a single employer, I see new stuff going up, some growth, new school buildings, etc. JMO.
Sorry if a repost. From BO, add this one to the “dead” list:
http://www.loancity.com
From another post: They were Alt-A, right?
We have been repeatedly assured by “experts” that the subprime implosion would be contained. I guess another bull(sh!t) theory was just laid to waste by the harsh glare of reality.
LoanCity Closes Seven Branches
Posted by Stephen Bernard on Feb 19 2007 05:58:13 PST
Mortgage lender LoanCity closed seven branches recently, leaving it with five nationally, BankNet360 has learned.
The San Jose, Calif.-based lender closed offices due to a “softer market and improved technology, which allows for better load balancing among branches,” according to a company spokesman.
LoanCity originated about $5 billion of loans last year, which includes prime, alt-A and jumbo mortgages. It also recently named John Giagiari as its new chief operating officer and Jeff Minch as national sales manager.
http://www.banknet360.com/news/NewsAbstract.do?na_id=7572
And today we have HC out there saying it is also spilling over into prime. Of course she has just the solution, a bailout using FHA.
Loancity Com: Offices
Arizona
7600 N 15TH ST STE 165
PHOENIX, AZ 85020
Tel: (602) 324-5900
Fax: (602) 324-5912
California
18301 VON KARMAN AVE #120
IRVINE, CA 92612
Tel: (888) 256-9542
Fax: (949) 417-3516
3300 DOUGLAS BLVD STE 155
ROSEVILLE, CA 95661
Tel: (916) 677-2000
Fax: (916) 677-2020
3131 CAMINO DEL RIO N STE 650
SAN DIEGO, CA 92108
Tel: (858) 550-9016
Fax: (858) 457-1037
5671 SANTA TERESA BLVD
SAN JOSE, CA 95123
Tel: (408) 281-3600
Fax: (408) 360-2467
1575 TREAT BLVD. #201
WALNUT CREEK, CA 94598
Tel: (925) 956-1911
Fax: (925) 956-1923
Colorado
4600 S ULSTER ST STE 250
DENVER, CO 80237
Tel: (800) 478-9519
Fax: (303) 539-7442
Florida
600 N. WESTSHORE BLVD #204
TAMPA, FL 33609
Tel: (813) 353-0197
Fax: (813) 354-1826
Georgia
200 GALLERIA PKWY SE STE 800
ATLANTA, GA 30339
Tel: (678) 303-3376
Fax: (678) 303-3388
Illinois
18 W 140 BUTTERFIELD RD #100
OAKBROOK TERRACE, IL 60181
Tel: (630) 613-7270
Fax: (630) 613-7741
Minnesota
601 CARLSON PKWY STE 105
MINNETONKA, MN 55305
Tel: (952) 449-5252
Fax: (952) 449-5282
New Jersey
2310 ROUTE 34 STE 1A
MANASQUAN, NJ 08736
Tel: (732) 223-8010
Fax: (732) 223-8364
North Carolina
6135 PARK SOUTH DR STE 510
CHARLOTTE, NC 28210
Tel: (704) 945-7134
Fax: (704) 945-7154
Oregon
7409 SW TECH CENTER DR # B135
PORTLAND, OR 97223
Tel: (503) 419-9269
Fax: (503) 419-9285
Texas
405 SH 121 BYPASS BLDG B #240
LEWISVILLE, TX 75067
Tel: (972) 829-8600
Fax: (972) 829-8612
Virginia
14500 AVION PKWY # 110
CHANTILLY, VA 20151
Tel: (703) 547-1050
Fax: (703) 547-1070
Washington
15 LAKE BELLEVUE DR STE 101
BELLEVUE, WA 98005
Tel: (425) 451-4592
Fax: (425) 451-8197
Wow — LoanCity was a ubiquitous presence in BubbleVille.
WHy to people take the opportunity to hijack Chicago stories with unrelated stuff? Some of us are actually interested in the midwest bubble
Umm, about those 4,260 foreclosure filings in Cook County, IL - isn’t that enough to cause some real concern in the Windy City? Many areas of the Midwest (MI, OH, IN) have been under pressure for quite some time now - can Chicago hold it together? If the F.I.R.E. jobs start going here, and why shouldn’t they by all recent nationwide accounts, there’s gonna be a whole lotta granite up for grabs.
I checked out foreclosure.com a week ago when I saw how high the foreclosure numbers were for Cook. There is pain happening everywhere, but a whole lot of those were in the more undesirable areas on the south side.
Inventory is way up over here, I drove north on oak park avenue (on the NW side of the city) two sundays ago and have never seen more open houses/houses for sale in my life.
Are you from the NW side, Steve? N. Oak Park Ave - that would be Schorsh (sp?) Village - some nice little homes there. I’m originally from Portage Park, where so far things seem stable. My sights are on the condos further east, where we’ll probably see the most volatility going forward.
Grew up just south of Riis Park around fullerton and Narragansett. I’m in the Oak Park area now.
I was indeed driving through Schorsch village–every year my buddies and I do a “Casimir Pulaski Day” celebration where we eat ourselves sick at a Polish buffet–we went to the Jolly Inn. Good stuff. But the real estate stuff was ridiculous–starting at about grand avenue all the way to Irving there were probably on average 2-3 signs every block. The block just north of addison I think had about 4 houses for sale. It was fairly shocking because that neighborhood I’ve always considered more stable, less transient.
Yeah, the south side, long a target for predatory lending.
Consider this:
Illinois wanted to try to keep people from being sucked into the subprime vacuum. They started a pilot program in which home buyers would be required to attend a mortgage counseling session if they met certain requirements (low credit score + high LTV) before being allowed to close on a house. The pilot program went into effect in a couple zip codes on the south side of Chicago and if the program was successful, they’d tweak it and make it statewide.
Turns out that the zip codes chosen for the pilot program were predominately ultra poor with 95%+ black residents. Ignore the fact that these zip codes have a history dating back 6-7 DECADES of predatory lending and high foreclosure rates.
Residents claimed it was racism. Realtors and mortgage brokers picked up the lobbying price tag and got the whole thing shelved within a month of the program starting.
Now, guess where a huge chunk of these foreclosures are located…
Talk about reverse redlining! And the poor get screwed again…
Just an observation. My friends who stayed in Illinois, all work for the State or Local government. Maybe not representive of the whole state, but I wonder with the Illinois Gov. wanting to increase taxes $34 billion. Will Illinois lead the way with the all goverment work force outstide of DC. Pay huge taxes to pay for one’s own salary. Interesting idea. I think it was tried in Russia a couple of years ago. Housing prices in Moscow and St. Petersburg are head up. Might work in Illinois too.
Everyone’s complaining about this one. Chicago tribune letters to the editor the other day was full of complaints. As a partner in an small business/LLC, I pay taxes already on any money I bring home. now they’re going to tax me on receipts, and then tax me again on what I bring home? fuhgedaboutit
Chicao is in a lot of danger. All the twenty & thirty somethings that bought over the past three years will none or little down are starting to feel the pain right now. I have a lot of friends screaming about their ARMs and they’re all having probelms getting refinanced.
That, and the area where many of those same people bought, the north side, has been reassessed. There might be added pain this fall when Cook County’s second installment bills come out. I too cannot fully grasp how many twenty and thirtysomethings I know of have bought condos at $250k+ with $400k not all that uncommon too. Some of the locations and quality of construction of these units are awful.
Crappy MSM reporting! The predominance of foreclosures in Cook County are new construction. These houses were sold as “monthly payment will be” , tax escrow was set up on a $200K house at $50/mo; the property tax bill comes in at $4100 and escrow is short by $3600, The borrowers monthly payments jump by $700/mo ($600 to cover actual extra 100 to cover future tax increase.
I have had a few of these preforeclosures referred to me - not a damn thing I can do.
The perils of buying payment.
“Sales of new Chicago-area homes fell more than 30% in 2006 from the year before, according to real estate consultant Tracy Cross & Associates Inc.”
So those are actual figures from 2005 to 2006…well they cannot blame the media. The media has started to talk about the housing bubble from February 2007 on…so the sales (or lack of sales) in 2006 is coming from the actual market conditions, not from any panick caused by the media…hehehehe
Are those $29K houses going to be included in the NAR stats ? I’d love to know what they were appraised at and how much the FBs had them mortgaged for !
Selling homes for $29K REALLY has to hurt comps. And when FBs get wind of really big price declines, that should start home prices accelerating lower. Accelerating.
Well, that and about a 30% reduction in buyers due to not qualifying for a mortgage anymore.
If the sale didn’t go through a local MLS, it’s not included in NAR stats, nor will Realtors see it when doing comps.
Your local MLS has a handy-dandy comp creator tool for Realtors to use - but it only covers stuff in their database. You think a lazy Realtor is going to walk on down to the county recorders office to look up sales that aren’t in their easy-to-use database? Ha!
I’ll tell you what. There ought to be a federal law that requires foreclosures to be part of MLS and comps. And it should be overseen by someone in authority as well.
If Dodd and Clinton really wanted to be helpful they would try to introduce this as legislation.
You don’t have to walk anywhere to get comps from the auditors office. It’s all online and realtors in Ohio have to use comps from all sources not just the MLS.
“High-interest mortgages are often the only option for people who are rebuilding their credit.
Let see here…Theres renting, living with your parents, living under a bridge car camping, tent camping…See…There are a lot of different options
living with your brother,your sister,your grandparents
“…living with your parents, living under a bridge car camping, tent camping…See…There are a lot of different options”
The American Dream!
Casey!
I work at a law firm in Chicago that does foreclosures for a couple of banks (I do not work at a mill) and our foreclosure department is extremely, and I mean extremely busy. Busier than ever before. We represent lenders who are prime and subprime and both are giving the firm an extremely volumnious amount of work. Its insane how busy we’ve been.
We also have an eviction department too; In Illinois, a condo association or homeowners assoc. can evict people for failing to pay timely assessments. Yes, you read that correctly. If you fall behind on your assessments, your assoc. has the option to evict you, take possession, and then sell the unit on your behalf to cover the past due assessments. (as a side note they don’t usually kick you out with the sheriff because the assoc. is still required to pay your mortgage - the eviction is just a threat/nuisance).
That being said, I think that homes are too expensive and people have stretched themselves too thin. On paper they can afford the loan but then life happens and there isn’t much margin for error. That’s what seems to be happening.
And of course, there are other antecdotal foreclosure stories. The funniest one is the idiot accross the street from my girlfriend and I who inherited his house mortgage free, and then heloc’d the crap out of it for a new truck, new car, pool, nice kitchen, etc, and then failed to pay his mortgage for two years. Oh, did I mention that someone bought his foreclosed home a judicial sale? Along with the judicial deed, a mortgage for $1,000,000 was recorded on the property. Do you know what that means? TEAR DOWN!!! All that money the dumbass put into his house (siding, kitchen, pool, basement) is being torn down for a McMansion!!! OH the frickin irony just kills me.
Yes, and wasn’t Illinois condo law strengthened just about two years ago? I have it in my notes from a meeting of the Association of Sheridan Road Condo/Co-op Owners, but forget the details. Speaking with long time residents of bigger buildings, I’ve learned of many an association that was left holding the bag. What of the smaller buildings though - how will a building of just a few units handle the ordeal of a foreclosure as they don’t have the resources and management experience the larger associations?
Can the affected smaller condo associations merge and manage several properties with limited resources?
Great question, makes sense, but there will likely be a whole slew of complicating factors. Imagine for instance, if a well constructed building’s residents must help shoulder the special assessments of a poorly constructed building?
Here in Houston, the HOA can foreclose on your house. There was a story in the Chronicle a few years back about an 80- or 90-year-old widow whose HOA foreclosed on her $150K paid-off house because she owed them $800. They sold the house out from under her for $5K.
“Council member Anthony Brancatelli estimates that 60 percent to 70 percent of the foreclosures in his ward involve people who tried to manipulate the subprime mortgage system and bought several homes with the intent of renting or quickly selling, or people grasping for their piece of the American Dream, without the financial means of making regular payments.”
And we’re supposed to feel sorry for those a-holes? What pisses me off is that because of their greed, I’ve ended up with higher and higher propety-tax bills.
You know, all of this just sucks. I think we have had our flash of “I told you so.”
Now reality is setting in, at least for me, that this whole thing is going to be painful for a lot of people.
Each of us has our interests to protect as best we can, whether you are trying to buy a house, sell a house, or just remain whole.
Because this is happening so fast it also seems to indicate that it will be very serious and far-reaching.
Gulp.
Its kind of an odd felling for me. On the one hand, I feel bad for the people in Ohio, but on the other, I want the same thing to happen here in Southern Cali.
I just want to see that smirk wiped off of so many peoples faces here.
“I just want to see that smirk wiped off of so many peoples faces here.”
I feel a little bit that way about some of the folks in Florida.
Hmmm, I don’t feel much because the majority in this country vote with their feet, and never question authority or MSM. So screw them and us.
Look. The pain. The pain boss.
PRETTY SCARY
Subject: Thank your stars we still have jobs!!!
So sad for all these people!
!. E-loan announced it will close their sub- prime wholesale division.
2. ResMAE is listed for sale.
3. Wachovia Corp.’s consolidation of its wholesale operations will
result in
layoffs.
4. Fieldstone announced that it is closing 5 west coast branches including
its Arizona operations.
5. Mortgage Lender Network (MLN) “stopped funding residential loans” on
12/29 (they didn’t actually say they were closing).
6. HMIC closed its doors on Dec 20.
7. Sovereign Bancorp, as part of a $100 million cost reduction strategy,
exited the wholesale mortgage market.
8. Own it Mortgage - closed its doors.
9. Sebring Mortgage - closed its doors.
10. Axis Mortgage - closed its doors.
11. Oak Street Mortgage - closed its doors.
12. Right Away Mortgage - closed its doors.
13. Secured Funding - closed its doors.
14. Loans 123 - Not taking any more business.
15. Aegis Funding (sub-prime division) - closed its doors.
16. Option One - Up for Sale.
17. Meritage - sold to Lime Financial.
18. Mandalay - closed its doors.
19. Southstar - Account Executives are leaving (a good source stated the
company cannot meet payroll obligations)
20. Countrywide - Multiple local layoffs.
21. Washington Mutual - Continued layoffs, exiting correspondent
business.
22. Saxon Mortgage - layoffs.
23. RFC - layoffs.
24. Decision One - closed 6 regional centers.
25. Argent - consolidated and let 1,000 people go and currently for sale.
26. Ameriquest - laid off 3,800 and shut 229 retail branches after
announcing a $325 million settlement with state’s attorneys general for
overcharging borrowers.
27. Bank of American Mortgage - laid off 225 locally.
28. Fieldstone Mortgage - closed their Las Vegas branch.
29. Acoustic Home Loans - closed its doors due to a sudden increase in
repurchases.
30. FNLC - exiting the correspondent sub-prime market.
31. WestWorks - closed their doors.
32. Funding America - closed all 3 regions, laid off all but 3 people.
33. Mylor Subprime - closed their doors
Todays Wall Street Journal lists two more casualties:
34. HSBC just added $1.6 Billion to its 2006 Bad Debt Provisions, reducing
their earnings estimate by 40%.
35. New Century Financial lost one-third (36%) of its total market value
after announcing sub-prime loan related write-offs. They will re-audit
financials for the first three quarters of 2006 after announcing accounting
irregularities.
Don’t worry, it’s not over yet…
Sorry I had to remove sender from this email.
I hear Wells Fargo just laid off 600 in sub prime area.
Here’s the story you’re referring to …
Wells Fargo Cutting 500 Jobs
Tuesday March 20, 2:52 pm ET
By Michael Liedtke, AP Business Writer
Wells Fargo Cutting 500 Jobs in Subprime Mortgage Division
SAN FRANCISCO (AP) — Wells Fargo & Co. is eliminating more than 500 jobs in a division that makes home loans to high-risk borrowers, adding to the economic distress caused by the decaying subprime mortgage market.
Most of the cutbacks, concentrated in South Carolina, Arizona and California, stem from Wells Fargo’s recent decision to make it more difficult for borrowers with blemished credit records to qualify for subprime mortgages.
http://biz.yahoo.com/ap/070320/wells_fargo_subprime_cutbacks.html?.v=1
Buh buh buh I thought there would be no employment spillover from subprime?
# 5 Mortgage Lenders Network has filed for bankruptcy protection. They have stopped construction on their HUGE new office building (its now just dirt and girders) up near Wallingford CT–or is it Meriden? sorry to be sloppy about this, for you out-of-staters, this is about half way between the coast and Hartford CT–and layed off most of their staff, hundreds of people. This was in a local, regional, business weekly.
Urban decline is an old story, especially in Toldeo, Detroit and Cleveland. Kind of like rural decline. No bubble in Tumbleweed.
The new story is suburban decline.
Yeah, I’ve seen pics of whole blocks and sections of Detroit and St. Louis that are completely uninhabited wastelands. But still, the decline seems to be accelerating. Guess that’s what happens when all the Konsumer Krap is made in China.
I’m guessing that those $30,000 Detroit houses are uninhabitable shells. Probably just paying for the land value. Which still ain’t very much.
Yeah, and for $30k you get the calls in the middle of the night from the cops telling you your crack house is on fire, they found a body or two, etc. etc. etc.
And would you want to visit the place? Imagine the thoughts going through your mind as you enter the place.
Is there a drug deal I am walking into?
Are people shooting up?
Will my car be stolen while I am inside?
Am I going to make it out of this alive?
They could give me the property and it still wouldn’t be worth it!
so i guess putting it up as a rental would be out of the question?
got cash?
I wouldn’t consider the places for rent. Imagine the people that would be interested in living in them?
No thanks!
The only bet is that the places will be bulldozed and some renewal projects will save you. But who’s to say the city government doesn’t come along first and take your property for a song?
Again, no thanks!
The city of Detroit will give you, for free, the deed to a vacant lot adjacent to your house if you use it to grow food for sale. For $10, you get plants, seeds, and compost. Consider it perhaps a thank you for not leaving?
“There is a food desert in Detroit,” said Emily Reardon, who works at MSU on projects that bring agriculture and youths together. “There is a lack of affordable, fresh food. The reason so many kids are getting pop and chips and candy at the neighborhood store to eat is that’s only what they have access to and what they can afford. But if you use available land to raise produce, it will be available and it will be affordable and people will buy it.”
Riet Schumack, 51, a mother of six who lives in the Brightmoor neighborhood, is an “Urban Roots” success story.
Last year, she persuaded the city, using techniques learned in the class, to give her the vacant lot across from her home. She built three raised beds — often, city soil is too contaminated to safely grow food — roughly 4 feet by 8 feet and filled them with free compost, brought to the site in borrowed trucks she got from the Garden Resource Program. She grew tomatoes, greens, beans and turnips.
At the end of the summer, she took her greens and some chocolate mint to the program’s stand in Eastern Market and made $45 in two hours.
There were about 300 urban “farms” in Detroit in 2006, and it’s estimated by the end of 2007 it will be up in the 375 range.
Urban farming in Detroit? Great idea, IMHO. People need to have more of a connection to their food.
And, yes, I do grow some of my own food.
I’m really surprised that there aren’t more strategies to “reclaim” urban areas. I know it sounds easier than it really would be but it just seems like a huge waste to keep building out in the suburbs or creating new suburbs when there is so much unused housing stock in some of these older cities.
Let’s face the real fact here about the borrower’s role in this. I work in the mortgage business, not in sales, but in the closing department.
There’s a reason why these borrowers fall into this trap of 2/28 and IO loans. They can’t pay their bills and these mortgage products exist to bail out this type of borrower for the time being.
The borrower has the FINANCIAL RESPONSIBILITY to manage their own bills. If the borrower doesn’t charge up all their credit cards again and spend spend spend, they can increase their fico score and get a 30 year fixed loan. When you miss payments or have substantial debt the only loan you can get is a 2/28 or ARM product of some type.
It’s called hedging your risk as the bank. That way the bank has a prepay penalty coming their way if this borrower wants to refi again within the 2 years or the bank makes good interest on this borrower for the full 2 years and the borrower refinances out into a new loan. People don’t sign their loan documents because they think it’s fun. The subprime borrower only sees cash out (instant money) and they spend it and then it’s gone and they put themself right back where they started with an even higher payment.
It’s obvious to me that the repeat refi’ers are doing so because they cannot budget themselves.
Why should anyone save them? They deserve what they get. Too many of these subprime borrowers should have never owned a home in the first place. It was just the latest fad that everyone else is doing and everyone contributed to the problem. But own up, if these borrowers didn’t get a loan through my company and you said, hey budget yourself and wait out your prepay, they’ll just call someone else and get a loan through them.
I have to be responsible for myself and I decided not to buy into the housing madness that’s been going on the past few years even though I work in the industry.
My friend is mortgaged at 100% to get into a condo and now with the business they face losing their house too. He bought last summer in Southern California. And he works in the business.
I told him to rent and wait it out, but no, they could not wait, having just gotten married. He’ll see this year that the house will be upside down on the mortgage and any hopes of a refi in the next year (when his 2/28 is up) will be a nightmare.
In the end all of these people deserve to be ruined because they don’t save their money and they waste it on going to restaurants 5 nights a week and try outdo everyone else. I bet they can’t even balance a checkbook.
I live well below my means and save save save. I don’t waste money. I use coupons and I don’t over pay for things.
What they should be saying is that subprime borrowers are not the victim, but the reason why the foreclosure epidemic is about to affect everyone in this country.
Values will drop due to over supply, yet everyone in So Cal is in complete denial that this imminent. Wake up people. Party is over.
I’ll wait this out another year or two and get a smoking deal on a place buy putting money down and having at least 12 months reserve in the bank.
Well said. Thanks.
I agree 100% that people have to live within their means. And that does not happen for most. But we cannot ignore the fact that the mortgage brokers played a MASSIVE role as well.
Nobody held a gun to their heads and said “loan Jose $500k”.
Lots of blame EVERYWHERE.
The problem I have with this assessment of “it’s all the borrower’s fault” is that this kind of behavior is human nature. If you tell people they can have X, many of them are going to take X. Anything you say after that, like “in return you must pay me Y,” is ignored. All the warnings in the world won’t stop them.
Most people simply don’t understand basic finance, and definitely not complicated mortgage products. This is why we have bankers and mortgage lenders: to act as trusted intermediaries. The trust has been violated.
There’s only one way to keep people from getting into a mess, and that’s not to offer them the money in the first place. This is why we have loan officers and lending standards. Hell, the raison d’etre of the entire lending industry is to be repaid on loans. If the industry cannot handle this obligation, their sole obligation, then they have failed as an industry, and they deserve the pain they will get.
This is why we have bankers and mortgage lenders: to act as trusted intermediaries. The trust has been violated.
Where in the world did you ever get the idea that bankers are supposed to act as trusted intermediaries. Bankers have always been interested in increasing their bottom line at the expense of their customers. That means getting your cash in their pockets. It is naive for you to believe that bankers are trusted intermediaries.
Just like the realtor who has a fiduciary responsibility - right?
this kind of behavior is human nature
All the warnings in the world won’t stop them.
Most people simply don’t understand basic finance
You say this, then you claim that it’s not all the borrowers’ fault? It IS their fault, plain and simple. I do agree, though, that the lenders deserve all pain they’ll get for loaning the money out (i.e. being enablers). But when it comes to blame, nearly all of it can be put on stupid borrowers who signed the dotted line.
“That way the bank has a prepay penalty coming their way if this borrower wants to refi again within the 2 years or the bank makes good interest on this borrower for the full 2 years”
Ah but here is where the banks are truly predatory: THEY ROLL THE REFI COSTS INTO THE NEW LOAN. If these dead beats had to come up with the cash this game would have stopped long ago.
What about the thousands of mortgage brokers, only concerned about their commission checks, who said: “Don’t you worry, you will be able to refinance later on…sign here, I promise.
The entire system is rotten. IMHO
I agree with most of what you said, however people are stupid as you pointed out and they need to be protected from greedy lenders like your company. I bet that not too many lenders want to part with their cut on the mortgage loan.
3 weeks ago some lender from California (probably out of business now) emailed me a GFE that had a 1% origination and a $4500 administrative fee.
What BS that was - how many fools have paid these fees to crooks?
“Ohio is working off of a totally new economic model than any of us have ever experienced in the past.” He predicts that a unlimited supply of polluted land coupled with exodus from baby boomers will prolong the bust indefinitely.
OMG, that’s funny!!!
Seriously, rural Ohio is very beautiful, and I really hope that the Midwest can come back to life. That’s really the core of America, in so many ways.
There is definitely “polluted land” here in Ohio. But, as a consulting engineer who specializes in brownfield redevelopment, there is more work available here than I could possibly pursue. State programs like the Clean Ohio Revitalization Fund have really started to spur some urban redevelopment projects, so I predict there is hope for inner cities and older industrial areas yet.
For what it’s worth, I have lived a dozen different places around the midwest and west, and the northern suburbs of Columbus where I live now is unquestionably the best of the bunch, in terms of cost of living/crime rate/amenities/schools.
Oscar,
I’m interested in your line of work (and from Cleveland area originally). Would you be willing to discuss offline?
If so, I can be reached at miscellaneous1@earthlink.net
I went back to Ohio,
And my city was gone
Hey, ho way to go Ohio!
But don’t worry, Chris Cagan over at American says the subprime meltdown won’t have any significant effect on the economy!
Here are 100’s of homes being sold for a 2004 song, and no busloads of specuvestors; no RE shills talking the game; no investor clubs showing links to ‘HOT NEW PROPERTIES!!’. It’s all going, going, gone. And coming to a city you live in.
Within the Bell school district in Chicago there must be close to 50 $1.XM+ spec homes sitting on the market. Unclear to me who is going to buy them anytime soon.
Bell, the CPS elementary school over there near Lane Tech?
That’s right - apparently one of the best elementary schools around…
Yes, it is. A friend of mine is the business manager at Ogden - another highly regarded CPS elementary school. He told me that they get lots of parents requesting tours of the school before plopping down their dough on all the new condos and townhomes going up near north. Evidently it hasn’t been beyond a realtor or two to stretch the school’s boundaries - much to the chagrin of the parents who later discover their $1M+ pad is outside the enrollment area.
Sounds about right. I love how they stretch neighborhood boundaries as well. And make up new ones in neighborhoods with bad reputation.
“Take a look at this beautiful home in rapidly appreciating West Bridgview!”
“Aren’t we in Pilsen?”
One thing’s for sure - you aren’t in Kansas…
I always get a kick out of “West Bucktown” and “West Wicker Park”
I am sick and tired of hearing “The bubble has popped, we’re in a housing recession, things are going downhill fast.” PUUUUHHHHLEEEEASE! The pin has not even pricked this bubble yet. We are only getting started folks! I recommend fortifying your humble abodes and stocking up on guns, ammo, rice, candles, and firewood if you live in the frigid northern regions. Hang on my friends, we are in for a long bumpy ride to the bottom.
PS if you are thinkng of buying when you see a 20-30% reduction, you may want to think twice. Beware the dead cat bounce.
At a true 30% off of today’s pricing, I’d be buyer. Make that a lightly leveraged buyer in a pretty nice home at 2x income.
I’m in MA.
Add a “wheelbarrow” to the list if the fed lowers rates this year. You guys should be able to figure out why on that one.
I’ve loaded up on Twinkies and Scotch. Is that wrong?
I’ve heard that Cleveland is known as “the mistake on the lake.” I wonder what ultimately becomes of a city when the majority of housing units are empty and boarded up, when there’s an insufficient tax base, when services are no longer provided. Does it become a “Mad Max” environment? Can such a city experience a rebirth after a period of extensive, convulsive destruction?
“The Fabulous Ruins of Detroit” might answer your question.
http://www.detroityes.com/home.htm
Those pictures look like something out of post-Chernobyl Russia.
Unbelievable.
Actually many of those buildings came down for improvements. Believe it or not downtown Detroit is better than it was 6 years ago with Compuware coming downtown. The problem in Detroit is its city neighborhoods - everyone is moving out to the suburbs because of the schools. What you have is a central core that is getting revitalized and then absolute decimation in the city neighborhoods.
In another city, the Ford Motor Company Headquarters building would become nice lofts.
“Can such a city experience a rebirth after a period of extensive, convulsive destruction?”
Ask the Decider.
Further aggravating the problem in Cleveland is the drain of the prime educated, working age people. I have complained about the Ohio (among other states) license plates driving all over our area of S.C., but I have to say that these re-locators we are getting are fairly affluent looking people who are mostly from 25-45 years old, primarily families. Can you say “tax base”?
And I can know they are from the Cleveland area because Ohio plates have the county name on them, Cuyahoga. I don’t recall that I have seen a Franklin County (Columbus) plate.
“Council member Anthony Brancatelli estimates that 60 percent to 70 percent of the foreclosures in his ward involve people who tried to manipulate the subprime mortgage system and bought several homes with the intent of renting or quickly selling, or people grasping for their piece of the American Dream, without the financial means of making regular payments.”
GREED, G-R-E-E-D. Not everyone who used a subprime was a person with little financial means. I mean, if you were going to flip a house, using a 30 year conventional loan made no sense, after all, your profit would come from holding the house for a while, not in decreasing your principal. Now a good chunk of these flippers are up chocolate creek without a popsicle stick.
Heck! Even my brother in law is trying to flip a house that he cannot afford to live in.
I lived in Western Michigan in the mid 90’s. For some reason during a few of those years they experienced “multiple offer” bids and real estate was going pretty strong. It’s quite the opposite now I guess. I moved away in ‘97. I was back this summer and noticed many large corporations had layed people off and trickle down from the auto industry has put the area on the skids.
I know a guy who sells real estate in this town. His name is Tony Bassett. ‘Here’s what I want to know, Tony: How many houses are for sale in Toledo that are listed under, let’s say, $30,000?”
“So Tony noodled around on his computer with that MLS database, and then I got my answer. ‘I’m coming up with right around almost 300,’ he said. ‘And that’s just in the Toledo Board of Realtors [multilist database]. It doesn’t include people trying to sell by owner, or anything for sale by a bank that’s not using our MLS. So really, it might easily get to 300… [325].’”
All I can say is, “HOLY TOLEDO”.
New Century ordered to stop loans in California
http://bakersfieldbubble.blogspot.com
Why is LEND allowed to carry on while NEW is nullified? Where is the outrage among NEW shareholders?
Where’s the outrage among the NEW shareholders
I don’t know, I’ll ask them both next time I’m at McDonalds.
OT..but I think you all will like this…from http://www.bostonbubble.com
ARM Reset scedule from Smith Barney conf. call (supposedly)
http://www.autodogmatic.com/forum/viewtopic.php?p=1226#1226
Ok I got these shocking Numbers from realtor.com
Toledo,OH TOTAL SFR for sale:
2604 listings
# over 1 million: 5 total (.002% of homes listed are over 1 million)
Most expensive listing: 1.8 million (8,000 sq feet)
—-
Los Angeles,CA Total SFR For Sale:
5313 listings
# over 1 million: 1042 (20% of homes listed are over 1 million)
Most Expensive Listing: 43 Million (they dont even list the sq feet!)
So what does this tell us? OH has endless land and no high paying jobs plus poor weather = real estate disaster.
your conclusion is: lack of million dollar homes = endless land and no high paying jobs. Go see if your local community college offers a course in logic.
New to the blog after lurking for a while. I agree that the credit market is international and that what we are seeing is only the first ripples of a potential economic tsunami here in the good old USA.
We deserve it though. The United States stopped manufacturing goods long ago. I’m an engineer and most of us in Southern California work in the defense industry. (also known as middle class welfare). My colleagues are oblivious to everything but keeping their defense jobs. I don’t expect us to keep building high tech boondoggles for billions. Once a defense downturn hits the South Bay area, places like Palos Verdes and the beach cities will really get hammered.
I guess “greed kills”.
tranche_ila
We deserve it though. The United States stopped manufacturing goods long ago.
Thank a union member.
Careful with comments like that, or I’ll call my Union Boss and we’ll go on strike.
I’d put in a “greevance” for that remark but I don’t think that’s how you spell “griieevanz”!
I love my union!
Don’t even start with “greevances”. Ugh…
I’m in a well run company with matrix management. Its the modern management solution that does what unions are supposed to do. Yes, only if matrix management is implimented right (just saying you’re doing it doesn’t work). In those scenarios, we’ve seen the blue collar workers walk union organizers right off the property. Why? They know they’ll lose too much if they unionize.
I’m at a multi company site. So we have several unions at one location. Two of the unions are in a pissing match and its creating a hassle and a half. The quantity of greevences has gone through the roof.
Critical path work could be done faster if we could move non-union or the 2nd union technicians to do certain work. Nope… not allowed. Worse, when the project reaches the next stage, because the 1st union won’t let the 2nd union do any of their work, the 2nd union is going to lock all other union’s out of *their building* when all of the work moves inside….
Insane. What this has resulted in is work being tranfered from the unionized companies to the non-union companies on this project. So when about 20 of the 1st union technicians will be laid off… we’ll transfer 30 non-union guys to the project.
Absolutely insane.
Don’t get me wrong, I’ve seen good unions. I believe its quite possible. But some things must change:
1. Promotion for performance. Sorry, but seniority means you have a bunch of guys who *might* know what they’re doing be baby sat by a 20 something engineer. Ugh…
Plus side? Technicians get moved into “non-degreed” engineering ranks (much higher pay) to be in charge if they are capable.
2. Flexibility. If I need 20 wiring guys one day but only 10 the next… let me put 10 guys to preparing the next job instead of being idle in the break room. And jobs get done by anyone trained/certified to do that job with no local certs by all certs being industry recognized.
3. Employment stability for the workers. When its hard to find replacements trained to do almost everything…
4. Improvements in productivity from below, a la Toyota.
We have that! Amazing how many unionized companies don’t… (Some do… as I noted, there are good unions. Very few.)
5. No threats at work. I’ve never been threatened at a non-unionized company. Every unionized company I’ve worked at I’ve witnessed people being threatened for doing their job.
6. A fair management process. See above on Matix management.
7. Fair benefits for all. E.g., I’ve bought picnic food for *everyone*. Not special meals for engineering and another for the floor. *everyone*.
8. Programs for *everyone* to advance on an accelerated basis (college tuition, specialized skill training).
Most of all, a union should, long term, provide a benefit to the customer. If the customer cannot see a reason to have a union, something is broken. The union should ensure worker safety, training, and morale while in return ensuring a fair cut of the pie.
None of this should be new. Its all implimented at many of the fast growing manufacturing companies.
Ok, rant off…
Got popcorn?
Neil
BS….love the right wing.
It is never managements fault.
Hey blame the Privates and the Sergeants and Captains it couldn’t possibly be the Generals or Colonels. Couldn’t possibly be the people in charge.
The big boys will give you plenty of people to hate, next to you or below you or different or far away….much easier to take everything from you when you are so busy paying attention to the poor shmuck across the Street.
Please did you really think our overlords were going to stop sucking the marrow from the bones once they munched through the poverty class and the working class?
With globalization they have figured out that the US middle class is just so unnecessary at least in the short and middle run…..and as the decider has said “In the long run were all dead”.
They ain’t done and you and I are next.
Welcome to the blog, Tranche_ila.
Like the moniker…
Say, ready to escort us to the next level, you huge-ish nasty looking spider that is for the most part, harmless.
I’m thinking though, that your version of a tarantula might be on the venemous side, if you know what I mean and I think you do.
Tell all you know.
“High-interest mortgages are often the only option for people who are rebuilding their credit. If the supply disappears when many houses in Northeast Ohio are vacant and begging for owners, it might cause a glut and depress values for years, Rokakis said.”
What about low-interest FHA mortgages (as advocated by Hillary)?
I feel sorry for the hard working stiff who lives in an apartment, who works studiously, saves money and will be laid off due to this economic contraction. Those who jumped on the kool-aid bus and rode it down the cliff with their exotic suicide loan get no sympathy from me.
But I feel for the “collateral” damage that this will cause throughout various industries. Live within your means was ignored by too many. There is a reason I do not try to buy (squeeze into) an 800k house, I can’t afford it. Is that so hard to understand?
Mind numbing stupidity. This is like 100 financial H-Bombs going off in 100 communities, lots of collateral damage to those who were not involved in the cause of it.
Collateral damage on this credit bubble will be worldwide. The total amount of debt that is going to do nuclear is astronomical. mortgage debt alone in the US is what 3.5-5 trillion dollars. Whoa, momma! Now mix in all the related games played by WS and the rest of the world and this will get messy.
Just a thought….imagine if every entity that was owed had to pay on demand. Imagine every entity that was owed had to be paid on demand. Talk about popcorn. There would be rioting and looting. However, it might just get to this at the rate we are seeing the demise of FBs and these mortgage houses!
OCDan,
Agree. Every word.
Its scary enough imagining a Christmas sales season sans new debt.
As to rioting and looting… I wonder if that will happen.
Arioch,
A lot of good hard working people are about to move in with mom and dad. Even worse, a few parents are now going to have to move in with their kids.
The number of people I know laid off is going up by the hour! Yes, I’m in southern California, but its scary who is now looking for a job.
It doesn’t matter what the fed does… it “feels” like the dam has broken.
Got popcorn?
Neil
“A lot of good hard working people are about to move in with mom and dad. Even worse, a few parents are now going to have to move in with their kids.”
Yet another reason rent will go down, not up as has been suggested if there was a home price decline.
Just a comment: Kudlow is an ass!
They said the R word… Recession… I don’t remember reading that before.
Wow, compare the MSM now to March of last year, what a change… I really do think think the business schools will be disecting this for years.
After readng this thread a few thoughts come to mind. First, this country’s sheeple and us included are going to need to rethink the whole idea of debt. After this collapse it will be hard to get and even if you get it, you won’t want too much of it. Second, I really believe that Youngstown is going to be a model for many midsized and smaller cities and towns across this country. While I realize the winters are tough and heating can be expensive, the thought of horse farms and apple orchards has more appeal than smog, overcrowded McCrap boxes stacked up against each other next to overcrowded schools. The thought of some quiet space is nice. Third, if I were in the banking game right now I would be very worried. Oh, it’s only LoanCity that died today. Sure, it always starts with the small guy and before you know it is eating the very top dogs. Lastly, I liked the discussion that cities need to stop measuring themselves by the population growth. I think this is an excellent point. For one thing, all of America needs to stop thinking that large numbers are the only way to measure improvement. We all need to downsize and consume less. I know that flies in the face of the Decider, but I don’t care. We all need a reality check on this and the next 3 years are going to be a harsh lesson for many and the others, if not effected, will now someone who will learn that lesson.
Not surprisingly, today when I left my apartment, there was a Countrywide ad for a home buying seminar. I thought, geez, these guys are getting desperate. Why not slowly shrink operations?
Stay away from POAs:
http://www.miaminewtimes.com/2007-03-15/news/paradise-lost/
..and HOAs….
Condo associations and the management companies suck too!
A SFH is about as close to soverignty as we can get. Why turn that remainging sliver of it over to someone else?
I loved this comment in the article referring to POA (HOA):
“He encouraged targeting “champions” who would lead the effort for a yes vote, and “bell cows” who would influence their neighbors.”
New word for ’sheeple’ is ‘Bell Cow’
The background of board members is a huge red flag…it’s also funny that someone would do a “santeria” ritual within the billion dollar premises.
First of all, let me say that I love this talk. The last 3 years have been dull, dull, dull. I will say, though, that it is amazing how quickly the markets can forget. Look at homebuilders in 1990/1991. NVR LP which is selling for over $700/sh was in Chapter 11. All the then major builders took huge write-offs. Most lenders in this country took huge losses. Citi had to go get $750 million in preferred stock from the Saudis and 6 months later had to go back and get more.
It’s another needed shake-out and the signs of the apocalypse are being noted again. This too shall pass. But enjoy it while you can, there will be some great deals out there,especially in FLa.
One constant though, The Donald was a deadbeat then, with an ugly combover; he still has the look.
Denial lasted quite awhile in Herculaneum & Pompeii, from what i’ve read. Many people got away, the ones that hung around felt safe, i’d suppose.
Wonderful places to visit, I recommend them highly. See them first and then finish your trip by going to the Archeological museum in Naples, where much of the booty from the diggins’ is on display.
A snapshot in time, of history, perfectly preserved.