Bits Bucket And Craigslist Finds For June 29, 2007
Please post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Today’s chart details New Home Starts and New Household Creation in an effort to investigate if there is a population growth relationship compared to New Home Starts, and it may also somewhat refute the “they’re not making any more land” preachers. I also included more background on my methodology as this chart posed some challenges I didn’t run into with the previous data sets.
I’ll be taking the weekend off and will have only a couple posts next week due to the holidays. Thanks to all of you for the positive feedback, and I encourage everyone to make a donation to Ben for his time and effort in preparing the Housing Bubble Blog.
http://theendofandanada.blogspot.com/
Next chart: Income growth for the general population and new home prices.
“Not being an economist, I lack the facilities to interpret these results.”
Michael, very nice work. Your comment above cracks me up, I believe you definitely have the “facilities” necessary, “even though” you’re not an economist. LOL
Nice job!
Interesting article about why trade statistics don’t work very well to capture a globally sourced product.
http://www.nytimes.com/2007/06/28/business/worldbusiness/28scene.html?ex=1340683200&en=e2038257a41ac21c&ei=5090&partner=rssuserland&emc=rss
Apple makes far more than most firms (and China makes very little) from each iPod manufactured, but it stacks up as a $150 import in the trade statistics.
These numbers completely ignore the issue at hand: where are the jobs created? So what if Apple makes money off of it, the money gets plowed back into creating more jobs in China.
As a designer of high-end computer chips I can assure you that the same dynamic is at work in my field. 98% of the employees under 30 are Asian nationals, most of whom work out of Asia, and virtually all of the investment in physical plant and equipment is in Asia. Sure, the executives drive Ferraris, but the middle class in the USA is shrinking while the same class is exploding in Asia due to this investment dynamic.
There is absolutely nothig to stop the subs in China, Mexico, India to pull the plug, take over all facilities and wish the shells where the CEO is located in the US good luck.
And why not? They do all the R&D, manufacturing, client service/help desk (miserable though it is). What could the corporate shell here do? Yell, scream, threaten and thats about it.
Dunno about other companies, but Apple vendors have already tried it, and lost. Apple can and will shop around to other providers, and crush their competition in court. Plus, all they can do is mimic. Visionary Steve Jobs, with his nerd squad of US R&D and US marketeers and industrial designers, are still shaking up fields that the experts think are–or thought were–commodity markets.
That said, I think it’s kind of sh-tty that Taiwan can build semiconductor factories and we apparently can’t.
Not only is it creating management jobs overseas, it is also creating a skilled work force. The US invented the FAX machine during WWII, the Japanese made it a household item. We invented the transistor, semiconductor, photovoltaic etc. How many are currently being produced in the US? The next generation of chips will be designed, licensed and royalties paid to Asian owned and operated companies. The US is incredibly rich, but so was Spain in the 1550’s and all the gold ended up in England by 1650.
US corporate tax policies are currently designed for a get rich now mentality. As a result of the current tax policies, long term corporate investment in the US is below replacement cost. Any US company that attempts to set a long term goal is going to be subjected to a buyout. It has been 30 years since any new US nuclear reactors or oil refineries were built. KKR’s acquisition of TXU relies on halting construction of additional power plants. Great long term strategy. Until there is some form of corporate tax structure that adequately compensates today for investing in the future, these deals will continue to occur. And manufacturing will continue to move overseas. My rant.
“…And the higher the level of investment in machinery, equipment, and structures, again, the greater the output that can be generated without leading to inflation. Of course, there is more to productivity than just the quantity of labour and capital. Quality matters as well. Improved education and training of the labour force can make a big difference in terms of the productivity gains that can be realized over time, as can the way a company organizes itself to get the work done….”
David Dodge
Governor of the Bank of Canada
to the St. John’s Board of Trade
June 13, 2007
Canada seems to have the theory right. Time will tell.
American Home mortgage to take ’substantial losses’:
http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070628:MTFH52122_2007-06-28_20-55-02_WNAS4975&type=comktNews&rpc=44
One thing to note:
‘Unlike “subprime” lenders that lend to people with weak credit histories, American Home specializes in prime and near-prime loans’
“and withdrew its 2007 earnings forecast”
now that is just shocking. lol
And the pattern continues…
thats definitely NOT contagion
That’s news.
You see the feeding frenzy the media, and the credit market, is going through on “subprime” three months after the problems were first disclosed.
What will be going on a year from now with other loans?
Don’t know about no other loans, but subprime has been, is, and will remain contained.
Well, contained to the planet , Earth, anyway. Don’t think this thing will spread to Mars, at least, thank god.
LOL!!
Imagine, KBH subdivisions on Mars. It’s different there, too.
They’re not making any more Mars’, you know….
Will you remember what you said six months from now?
But I thought the sub prime mess wouldn’t spread?
It’s not spreading, it’s “massaging the tense broader markets with relaxing fingers of joy”.
LOL, for real.
Centex Salesman getting desparate?
It’s been removed.
Perhaps someone from Tampa with an Uzi - threatening to spray a crowd of visitors at the sales office for not buying?
Not to worry, Ray’s put the Uzi away. He’s free and clear - just traded his house for a boatload of tires, seafood, pet food, and toothpaste from China.
Flag it as SPAM, because that is what it is…
Long article on Bloomberg detailing shaky CDOs and the failure of the ratings agencies to downgrade them. It’s like porno for HBBers. Very hard to believe it’s in the mainstream press.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aN4sulHN19xc&refer=home
Another article along the same lines.
http://news.goldseek.com/GoldenJackass/1183129380.php
related article on credit crunch:
http://tinyurl.com/2u36dk
“The median price fell for the 10th month in a row to $223,700, down almost 14pc from its peak in April 2006. This is the steepest drop since the 1930s.”
Not exactly the way it’s characterized in the U.S. MSM…yet.
I agree. I don’t really understand why the MSM is unable to accurately convey the seriousness and magnitude of the pricing changes/inventory build. I’d almost say it was intentional if it didn’t involve so many organizations. Perhaps it is an ingrained bias towards spinning business news in a positive manner?
“I don’t really understand why the MSM is unable to accurately convey the seriousness and magnitude of the pricing changes/inventory build.”
Because they are advertisement driven, and no one wants to advertise in a media that is telling being that the entire economy is on the knife’s edge of total collapse.
The mainstream media consists of reporters and editors. They are people with more energy than average folks, but with no greater intellectual capacity or insight.
They report on things they find interesting, and things which impact them personally. For a long time, they must not have been impacted personally by the housing bubble. Once they felt the impact, they begin to report on it in a way which they think benefits them. At first it was cheerleading, now it’s moved to more neutrality and a bit of doom-and-gloom.
But regarding their insight and intellectual capacity - see how they keep going to advocacy groups like NAHB or NAR to get their “expert quotes.” It’s like going to a pro-life group to get quotes on abortion or going to an anti-death-penalty group to get quotes on capital punishment policy.
To the discerning, the kind of advocacy group consulted determines the slant you’re going to get.
It is either laziness, bias or a lack of insight that leads the MSM to continue to consult advocacy groups for quotes on important issues of the day.
You know, they teach you in journalism first off to consider your source. There’s no way that the MSM, comprised mainly of those with college dregrees in journalism, are unaware of the basic logical error underlying the gathering of “experts” from advocacy groups. I’m of the opinion that most of these guys/gals already own houses and just don’t want the market prices of their own properties to fall.
“Lehman Brothers Holdings Inc., the biggest underwriter of mortgage bonds, sold $2.43 billion of Structured Asset Investment Loan Trust bonds a year ago. An $18 million portion of the bonds rated BBB- fell to 43 cents on the dollar from 98 cents in January, according to prices compiled by New York-based Merrill Lynch & Co.”
Ouch.
They’re throwing around numbers like $150-250 Billion of losses on these CDO’s. And as we have seen from BS, many were probably bought using leverage of 5-10 times.
So what they are really trying to say is more like $1 Trillion in losses rolling not only over the bond (bag)holders, but also over anybody who may have lent them money. It’s too bad lot’s of these are pension funds. Time to get worried perhaps.
Given that the bailouts on record have been for in the range of $4-5 billion, how in the heck do you bail out $1 trillion….
You can’t. Hence the desire to postpone the day of reckoning.
bailing out 1 trillion is just more “NEW PARADIGM WEALTH CREATION”…finance it.
Losses may rival the savings and loan crisis of the 1980s and 1990s. The Resolution Trust Corp., formed by the U.S. government to resolve the thrift crisis, sold $452 billion of assets at a cost to taxpayers of about $140 billion.
And this is news to the fave’s and reg’s on HBB?
If the reporter had any gonads he’d write that the current debacle has the potential to DWARF the ’90’s collapse.
Don’t just get your popcorn.
Better starting checkin’ up on the bug-out kit.
This was in one of Ben’s posts yesterday, but I thought it bore repeating.
The Telegraph. “The United States faces a severe credit crunch as mounting losses on risky forms of debt catch up with the banks and force them to curb lending and call in existing loans, according to a report by Lombard Street Research.”
“The group said the fast-moving crisis at two Bear Stearns hedge funds had exposed the underlying rot in the US sub-prime mortgage market, and the vast nexus of collateralised debt obligations known as CDOs.”
“‘Excess liquidity in the global system will be slashed,’ it said. ‘Banks’ capital is about to be decimated, which will require calling in a swathe of loans. This is going to aggravate the US hard landing.’”
Will it be “controlled flight into the ground” to use NTSB vernacular? Or will it be a stall-spin that leaves nothing but unrecognizable wreckage at the impact site?
“Underlying rot.” I wonder how well BB is sleeping these days.
“The United States faces a severe credit crunch as mounting losses on risky forms of debt catch up with the banks and force them to curb lending and call in existing loans, according to a report by Lombard Street Research.”
I wonder if anyone at the Fed is even aware the U.S. faces a severe credit crunch? Anyway, not to worry — I am sure this is nothing a few helicopter drops of freshly printed cashola cannot cure.
Let me be the first to answer the question posed. It is going to “Auger In” with no survivors.
I do not subscribe to Lombard Street- so I have not seen the original source material -, I am skeptical of this Telegraph item just because Ambrose Evans-Pritchard wrote the article. Ambrose Evans-Pritchard (with regard to previous financial items) misquotes, takes out of context and uses unverifiable sources. His earlier item this week also in the Telegraph was a deliberate misconstruction of the BIS annual report taking “what ifs” and relaying as “stated” fact.
I agree that we may face a credit crunch and I believe that 75% of the listed NYSE companies are at risk. However “toggle bonds” are still liquid and Japan is still lending. As long as someone is willing to buy a “toggle bond”, there is difficulty in having banks calling loans. Toggle bonds in the financial financing work similarly to option arms, but can be refinanced at any time without ever paying interest.
Toggle bonds “pay” interest in the form of additional bonds given to the bondholders. Eventually it ALL must be repaid. Toggle bonds only delay the day of reckoning.
I don’t know, borrowing money to pay the interest on money already borrowed seems like a pretty conservative play to me. What could possibly go wrong?
The U.S. govt does it, so how can it be bad?
Wouldn’t it be great if you could buy a house with toggle bonds! Just pay with a new bond to in lieu of interest and when you die - tough luck to the creditors!
I’m thinking that we’re looking at what rocket scientists call a “RUD event”.
Rapid Unscheduled Disassembly….
Usually, the first indications we’re heading for a RUD is when fuel flow into the combustion chamber exceeds the tolerace set by the ability of the combusted materials to escape the exhaust nozzle. This causes a build up of preasure in the combustion chamber.
It is a rocket, so you can’t just shut it down, and it can’t glide to a smooth landing. Once you’re in a RUD event, several things can happen.
1) the exhaust nozzle can be blown off, destroying thrust and causing the rocket to fall to the ground and be destroyed in a hard landing. Most of the fuel continues to burn off, so not much explosion, just one giant piece of metal hitting the ground very hard. Technically not a RUD, but still results in total destruction.
2) combustion chamber explodes from over preasure, blowing the rocket into lots of various size pieces, releasing the fuel which explodes, and further disassembles the big pieces into small pieces.
3) The presure in the combustion chamber exceeds the preasure in the fuel feed lines… Think backfire where the burn spreads to the fuel tank. One GIANT boom. A true RUD.
We clearly have a problem with financial loss (fuel) flow exceeding the ability of these funds to absorb, and they can’t shut down that flow. Preasure is building in the financial markets (combustion chamber) as everyone seeks to mitigate losses.
What kind of RUD are we going to have?
DRUM BEATING FOR BEN. Yesterday, I noted in a thread that Ben, his blog and the insights of the talented posters here saved me a ton of money re a disastrous house purchase I was trying to make in the Spring of 2005, just as I discovered the HBB. I was chasing properties that had multiple bidders and my HBB epiphany saved me about $150K, or 30% relative to what I’m certain the equivalent property will cost late this year or next. In my budget, that’s huge.
During more than two years of following Ben’s blog, I’ve been in awe of his dedication to providing copious, timely and relevant content, day in and day out. No time off. Annoying trolls are long a thing of the past – which takes even more work, from what I can tell.
Ben rarely asks for donations. I contribute regularly and I’m sure several others do, but likely there are many of us who came close, yet didn’t pull the trigger. There’s no better time or way to say, “Thanks, Ben,” than by making a financial contribution now. If you can’t get PayPal to work for you, I’m sure Ben can find a means for you to participate.
Thanks for the reminder. Time to “pull the trigger”. I refuse to use Paypal due to their anti 2nd amendment stance. So I contacted Ben on an alternative method of contributing to this vital site. I was given an address so that I might send my personal check.
PO Box 3312
Sedona, AZ 86340
I look at it as very inexpensive tuition on a education I couldn’t get anywhere else.
I’ve spend the word here at work. Ben has a nice following developing in several dept at UCD that watch these sorts of events.
Thanks! I prefer this method.
Off to write my check.
What anti second amendment stance is that? (Life NRA member but also occasional PayPal user here and concerned to hear it…) Email me offline, jwright at NO SPAM FOR ME PLEASE commsoft dot com.
“I contribute regularly…”
And I do too.
Thanks for the reminder. I sent mine
More HBB porn is offered up on p. C1 of today’s WSJ. There is also some great detailed information in this article about the problems extending foreclosure forbearance to subprime borrowers creates for different risk tranches of MBS holders. I recommend Ruth Simon for a HBB journalism award.
Subprime: Point to Where It Hurts
By Lingling Wei, Ruth Simon and James R. Hagerty
Word Count: 939
As defaults on home loans mount, mortgage companies are scrambling to work out deals to help as many borrowers as possible stay in their houses.
On the surface, it seems an obvious tactic. Lenders usually end up losing money on foreclosed homes because of legal and other costs and the need to sell those properties fast, often at a knockdown price. Also, politicians are pressing mortgage companies to minimize the damages foreclosures cause to families and neighborhoods.
Still, the effort to hold down foreclosures threatens to create clashes between mortgage companies and investors in securities backed by bundles of home loans, a $6 trillion market that has been shaken recently by losses on some of the riskier types of mortgage bonds. And because of the way these securities are sold, these efforts can pit groups of holders against each other.
“It’s going to create a class warfare” among different types of investors, predicts Kyle Bass, managing partner of Hayman Capital Partners LP, a Dallas hedge fund.
http://online.wsj.com/article/SB118308383764052523.html?mod=home_whats_news_us
class warfare in America begins when J6P is refused the right to buy an Iphone on his credit card, cause the Japanese and Chinese are paying in cash.
I figure the smarter people here would know, is there any good way/ program to keep gold in a Roth IRA?
Buy gold ETF in your fund. GLD is the obvious one
You can choose to have your IRA administered by American Church Trust. http://www.churchtrust.com
If you go to the site, click on IRA services and you will see a “precious metals” tab. That gets you all the info you need to start.
You are able to order the type of metal you want to hold in your account through your own dealer. Please note that not all coins are allowed to be held in the account and that info is given on the site. There are quite a few places to buy the gold/silver. I’ve always found good service and good prices at http://www.apmex.com
The administrators can help you with the details.
Of course the easiest way is to just buy either the ETF’s (GLD) or the Central Fund of Canada-CEF ticker (which holds both gold and silver). The problem with either of these is that you only hold a proxy for the metal and not physical metal ownership. Not much of a problem if you want to settle the account for U.S. dollars. Hope this helps
http://tinyurl.com/263r6u
Link from BusinessWeek about the implications of Bear Sterns situation. Openly talks about possible crash.
In the current unsettled environment, I can’t imagine writing that and then having it dated July 9, 2007.
Great article. Really tells it like it is, IMHO. Thanks for the link.
From the article, “It’s white-knuckle time on Wall Street as firms try to prevent the subprime mess from spreading.”
How can they prevent it? Either people can make their mortgage payment or they can’t. No amount of paper shuffling can change that. Sure, they can apply some band aids to buy time, but in the end it changes nothing.
I think it is “white-knuckle” time because they can’t spread the subprime mess further into the hands of unsuspecting buyers. In other words, the cat is out of the bag and nobody is going to buy this crap from the bagholders. The merry-go-round has stopped moving and the stench is starting to waft up from what they are sitting in.
All these articles today (from very mainstream sources) are really scaring the heck out of me. Yet the market is up. I don’t get it.
90% of the masses hear the words “CDO and Hedge fund” and its means nada, zilch, zero..
All the MSM coverage is not gonna get JSP away from the playstation to pay attention to the melt-down.
the stench is starting to waft up from what they are sitting in.
The bottom line is the entire mess is based on the virtual takeover of the entire real estate biz by an incredible number of inherantly dishonest people over the last 4 years.
All these alphabet soup financial debt holdings are largely based on a series of LIES AND DECEPTION from the loan application process; to the appraisal, to the underwriting process, all compounded by an evironment of unregulated oversight
So how do you have rating agencies function when what they are rating is nothing more than a mirage, far, far removed from what’s really transpired on the street.
Sure like to know what the mathematical derivative formula is for blatant and outright human greed and treachery.
No way these guys got a handle on any of this.
Too big to fail?
It’s a new paradigm.
Forrest Gump: Stupid is as stupid does.
As London Firm Shuts Down, Worries Spread To American Home Loans Made Back in 2005
By Carrick Mollenkamp, Michael Hudson and Serena Ng
Word Count: 822 | Companies Featured in This Article: Dollar General, Goldman Sachs, Citigroup, Lehman Brothers, Wachovia, Bear Stearns
Bond market turmoil spread yesterday as a London investment fund shut down because of bad bets on mortgage-backed securities and, separately, banks were left holding part of a closely watched corporate bond offering.
The London fund, Caliber Global Investment Ltd., announced it was shutting down because of souring investments in bonds backed by mortgages to American homeowners with sketchy credit. So far, most of the pain in the mortgage market was caused by loans made in 2006, when lending standards reached a low.
http://online.wsj.com/article/SB118308397498652526.html?mod=home_whats_news_us
“So far, most of the pain in the mortgage market was caused by loans made in 2006, when lending standards reached a low.”
And this was after the peak, which occurred about NOV-2005 in California anyway.
Had a conversation with a mortgage girl from a major US bank. She confirmed my fears. You can still today get a loan “no problem” with a 640 FICO and only 5% down. The bubble loans are STILL BEING MADE! Will these people never learn?
Yes I believe it. I saw a piece (no link, sorry) a couple of days ago that mentioned that some consumer advocacy organization had analyzed a recent loan securitization and pointed out that all the same abuses (stated income, zero down, low scores, etc.) were still there, and in large numbers.
and outside the US the free money party is still continuing like never before, despite the internet … 8-10x income loans, 0% down, 110-120% financing, no problem at all.
“and outside the US the free money party is still continuing like never before, despite the internet … 8-10x income loans, 0% down, 110-120% financing, no problem at all.”
And this is why I won’t buy into the foreign securities markets. The music would stop, and I’d be without a chair.
yes, I agree - the stellar uptrend in EU stock markets is driven by loads of funny money. On top of that there is a currency risk (I don’t think the euro will ever rise strongly against the US dollar, but I wouldn’t rule out the opposite).
still, I’m surprised that while the music in the US seems to have stopped the game of musical chairs is still very popular in Europe.
I may be wrong but that 5% might be a bigger obstacle than you think. At least there is no more 100% loans.
Not true. Just sold a house to a couple who are getting one. I feel kind of bad, except the house is underpriced by about 20% and they do have good jobs (medical).
Perhaps the other houses are overpriced by 20%? Just a thought.
Just read somewhere that the “federal” level guidance (and implied threat) about subprimes is directed only at banks, not at the mortgage brokers who generate some 3/4 of this stuff.
I just got another “offer” in the mail yesterday to refi with a neg-am loan. I’m still getting at least one of these a week. Amazing. Just out of curiousity, I’d almost like to find out if any of these lenders would appraise my place high enough to make the loan, not that I’m in the least interested in their “product”.
I get one or two phone calls on my answering machine every day. “You’ve been approved for a 1%…..” Got to be for some neg-am teaser rate. On the one hand, somebody has to be pretty dumb to fall for that, on the other hand how can that NOT constitute fraud? In what reasonable version of the English language could “1% loan” imply a negativly ammortizing payment rate?
I just got a phone call trying to sell me a 1% loan (didn’t bother to listen after than) Maybe they forgot to turn off their computer calling machine.
KB Home Loss Comes Amid Glut, Waning Demand
By John Spence
Word Count: 337 | Companies Featured in This Article: KB Home, Lennar
KB Home reported a fiscal second-quarter loss, reflecting how builders are attempting to slog through a U.S. housing market stuck with an oversupply of homes for sale and slackening demand.
“Housing affordability challenges and tighter credit conditions in the subprime and near-prime mortgage market have…exacerbated current market dynamics, keeping prospective buyers out of the market, slowing the absorption of excess supply and further delaying a housing market recovery,” …
http://online.wsj.com/article/SB118303487697551426.html?mod=home_whats_news_us
The docking bubble…
When the Dock Is Worth More Than the House
Boat-Friendly Homes
Sell for Big Premiums;
Friction in Florida
By BEN CASSELMAN
June 29, 2007; Page W1
The most valuable piece of a waterfront property isn’t always the land. Sometimes, it’s the dock.
In vacation spots from Buzzards Bay in Massachusetts to Puget Sound in Washington, home buyers are increasingly paying big premiums — sometimes as much as twice the cost of comparable properties — for waterfront homes that come with their own docks.
http://online.wsj.com/article/SB118308397101952525.html?mod=todays_us_nonsub_weekendjournal
A dock and a boat looks always seems like a good idea, but it requires a lot of cash and expertise to actually use them. I live in a waterfront/lagoon community, and more than half of the owners do not have boats because they can’t afford them or are unable or unwilling to do the work required to operate and maintain them. The adages about boats are true: “a hole in the water into which one pours money,” and “the 2 happiest days of a boaters life are 1) the day he buys the boat, and 2) the day he sells it.”
And don’t forget the old adage: If it flys, floats or f**ks, rent it!
Had my daddy taught me that principle before I turned 12, I likely would be rich by now.
LOL That is funny and true!
Wish my girlfriend’s father realized that… He’s working gigs he doesn’t even like away from his family and feels depressed about money–in part to pay for his bought new Sea-Ray.
He and the wife fuss about keeping it nice, but let’s be real. Boat resales are even more brutal than used car prices. That’s because many people need (or think they need) a car for transportation to work, but nobody needs a boat (unless they fish for a living, and this thing is no commercial fishing boat).
At first I just thought he was a bad father because he wouldn’t give my gf any money when she was broke one summer in college and I was feeding her. In retrospect, though, getting herself broke, and then getting herself out of broke, was a painful lesson she had to learn.
Now I just feel sorry for him, because he’s still paying off that stupid boat, as well as his Beemers and Suburban, when he wants to be partially retired. And let’s not even mention the “dream house”, the dock, the gigantic mortgage payments. What a fool. 45-year old David made promises that 50-year old David no longer wants to keep.
Sounds like a bad father to me. His Suburban, beemers, boat, and early retirement are more important to him than feeding his children when they’re in school. Forcing his daughter to turn towards men for food is not acceptable in any culture. This sort of thing is quite annoying, really.
“45-year old David made promises that 50-year old David no longer wants to keep.”
Excellent way to make the point.
Summer’s half over.
I never seen so many boats in people’s yards and broker’s lots on the 4th of July in my life.
Boatowner = bagholders for $4.00 a gallon dock fuel.
Last week I saw a link to a chart that showed Countrywide Funding was holding over a trillion dollars worth of REO’s. I know that many states let people pay their property taxes in two installments, if Countrywide is still holding these properties around tax time how will they pay these taxes?
A trillion dollars? At 250K per home that’s 4 million homes.
Does that sound reasonable?
Last I heard it was about 10,000 homes worth about 2.5 billion.
Their balance sheet has 60 billion in assets, not a trillion, IIRC.
It is 10,000 homes worth $1.8 Billion.
http://countrywide-foreclosures.blogspot.com/2007/06/9214-reos-offered-for-sale-on.html
Go to:
http://countrywide-foreclosures.blogspot.com/
As of june 29 9,495 houses at $1,856,277,255 at 1% tax rate would = $18 million
From Forbes.com
http://finance.yahoo.com/real-estate/article/103175/top-markets-for-home-buyers
Top Markets for Home Buyers
“To determine which of the country’s real estate markets most benefit buyers, we looked at data from Moody’s Economy.com and the National Association of Realtors. We tracked excess inventory and the change in sales rate over the last year to gauge the relative tightening or loosening of the market. Then a measure of price stability was applied to prevent the list from being a run-down of sinking ships.”
—
OK, that paragraph was pretty funny.
Paraphrasing on Tampa: Sure it’s going down “and has yet to bottom out”, but because the bubble here was caused by “high investor share” and those are being shaken out (and other piddling market forces like insurance and lending changes mentioned briefly), the market in Tampa is “highly resilient” and should rebound. So Tampa is the number one best market for buyers. Yippee. (Later in the pictures: “Moody’s projections have the market bottoming out in early 2008.”)
The final paragraph suggests watching if inventory burns off through October. “If sales don’t pick up and work out inventory issues, expect to see significant price declines.”
Gee, what if there are significant price declines _leading_ to sales picking up? (I can’t wait to see how that would look on the October version of the list.)
Does anyone know what subrime rates these days are? Any info on rates by fico?
Sure subprime less than 80% LTV is ~ 9.5% 1%ysp
Prime full doc 80% LTV is ~ 6.375 par 30 yr fixed fico 620
prime full doc 80% LTV is 6.125% par 30 yr fixed fico 680
Jumbo full doc 80%LTV is 6.625% par 30 yr fixed fico 620
Jumbo full doc 80% LTV is 6.375 par 30 yr fixed fico 700
different states, diff rates; I quoted Wisconsin; Illinois is worse.
http://tinyurl.com/2mcdn2
Fifth Third Bank rate sheets - pick your state
thanks a lot!!
Murrieta company, broker to forfeit licenses in Inland Empire fraud case:
http://tinyurl.com/2j7293
“A Murrieta-based real estate investment company and a broker that sparked a rash of lawsuits and a criminal investigation have agreed to forfeit their real estate licenses, according to a document filed with the California Department of Real Estate.”
“Montecastro and Stonewood Consulting are accused of engaging in a scheme in which inflated appraisals were used to obtain mortgages larger than the price that the sellers actually received for their properties.”
“Stonewood Consulting took as commissions the difference between the contract sales price that was reported to the lenders and the price paid to the sellers, according to the complaint. The department said an audit of 10 properties conducted as part of its investigation showed that Stonewood Consulting collected commissions ranging from $75,000 to $115,000 per house, for a total of $969,158.”
“In civil and federal lawsuits, Stonewood Consulting investors claim they were induced to buy multiple houses with inflated mortgages with the aim of raising funds they thought would be invested for them with a guarantee of big returns.”
“Richard Ackerman, a lawyer for many of the plaintiffs, says that investors in California and several other states were defrauded in a scam that involved the purchase and refinancing of hundreds of houses, the majority concentrated in southwest Riverside County, particularly Murrieta and Temecula.”
“Anna Richter, 39, a Rialto resident and Stonewood Consulting investor who has been organizing rallies to urge authorities to take enforcement action, said, “I am happy their license will be revoked. However, I am extremely disappointed in the bureaucratic slowness of justice. Someone should be arrested by now.”"
“The Riverside County district attorney’s office has said it is investigating Stonewood Consulting for possible crimes involving mortgage fraud.”
With the housing market tanking, losing one’s real estate license seems more like lifting a burden than administering a punishment.
“Bank regulators have agreed on new standards for subprime mortgage loans and are prepared to release it Friday, several sources familiar with the matter said Thursday.
The draft called on mortgage lenders to take more care when dealing with less credit-worthy borrowers by assessing whether they can cover long-term payments and warning them about hidden costs.
It also asks lenders to weigh a “borrower’s ability to repay the debt by its final maturity at the fully indexed rate.”
That provision is tougher than many lenders had hoped, as qualifying borrowers at the “fully indexed rate” could put a crimp in standards that evolved during the housing boom….”
I follow the forclosures in seminole county fl. here where I live. There used to be just a couple per day…Check out the volume now.
And like we have been saying this is just beginning.
http://www.seminoleclerk.org/Foreclosures/
There were 960 foreclosures in the Sacramento area last month. The total sold thru MLS for the same month as about 1500. Soon, more foreclosures will be coming on the market than are sold each month. Wow. It wil be a Housing Tsunami….
One for the the Philadelphia area bloggers…
http://www.philly.com/inquirer/opinion/pa/8240697.html
“…estimates that 2.2 million borrowers who got subprime loans since 1998 either have lost or will lose their homes through foreclosure over the next few years. This includes one of every five borrowers who got subprime loans in 2005-06, a default rate unmatched in the history of the modern mortgage market.
What does this mean locally?…”
(I do not necessarily agree with this statement, “We need to help families everywhere - including in this region - who are struggling with foreclosures today.”)
The article states that 1 in 5 will lose their home to forclosure. I disagree. I believe it will be 3 in 5 will lose their home.
I should have said 3 in 5 subprimes will lose their homes while
1 in 5 prime lose their homes… This is just my humble prediction.
According to the FDIC (in March of 2006), their estimate is that 10% of all current homeowners will lose their house - subprime, Alt-A and Prime included in their figures were 100% owned houses. So I think your figures are pretty accurate, possibly low.
Got cash.
Funny…when I read that, the 3/5 number is exactly what I came up with as well. No way “sub-prime” is only going to see a 1/5 forecclosure rate. Not unless there’s a major bailout plan.
There was a letter to the editor in The Inquirer today http://www.philly.com/inquirer/opinion/20070629_Letters_to_the_Editor.html from the Pres of the Pennsylvania Association of Mortgage Brokers touting legislation for the licensing of loan originators and the education of consumers to avoid future subprime debacles. Seems to me that there is an extraordinary lack of attention to greed in such analyses, be it the greed of the lenders or the greed of those seeking subprime loans. The fact is, some people are not responsible enough or do not have the financial ability to buy a house.
I tend to think we’ll see an increase in crime in the coming months…
Foreclosure possibly pushed man to invade Macon home
http://www.macon.com/100/story/77900.html
I agree. I’ve actually been seriously considering switching to criminal law to capitalize on the coming wave.
“..two counts of kidnapping, attempted armed robbery, burglary, theft by extortion and two counts of making terroristic threats..”
The results of his foray into the criminal world are on par with his real estate endeavors.
In the *old* days, the deppities would have just smacked the crap out of this fella, made him apologize profusely to the innocents involved and warned him that his body might never be found if he ever tried that again. In the old days, that pretty much worked, and it saved taxpayers one heck of a lot of money.
Laid off aerospace worker turns to hilarious crime to fill in his empty pool hole and replace his repossessed shrubbery.
Truth is stranger than fiction
1977 George Segal and Jane Fonda
http://www.imdb.com/title/tt0076059/
Ahead of its time.
Fun with Dick and Jane (2005) Jim Carrey, Tea Leoni
http://www.imdb.com/title/tt0369441/
Someone here recommended the Dick & Jane movie when it first came out. We saw it, and it was all about how they weren’t as rich as they had thought because their mortgage was worth more than their house, no job, etc. Too funny & totally right on!
http://news.goldseek.com/GoldenJackass/1183129380.php
Absolute Bond Contagion
When the contagion (denied no longer) is systemic, pervasive, broad, multi-faceted, and ominous in its lethal potential, perhaps one can calmly conclude that the system is merely adjusting to a total change in the seas. NO WAY!!! Without much doubt whatsoever, Bear Stearns is GROUND ZERO for the bond market firestorm. BS was forced to extend $3.2 billion in loans to its hedge fund clients, who attempted to liquidate but could not. That represents 25% of the BS entire capital. Don’t worry. Both hedge funds will eventually die, but when they do, BS will possibly die with them. A few months time is all they bought. Call it a STAY OF EXECUTION in legal parlance. With great amusement on my end, reaction to the denial of contagion, the claimed containment of the subprimes, the assurance of no spillover into other arenas, housing recovery in the spring, capex from corporations leading the recovery, these have been met with my disgust, outbursts of laughter, and dismay that such broad deception and misrepresentation can pass as journalism and economic analysis. Without doubt, the economics profession is replete with more harlots than Piccadilly Square or Battery Park or any fine district in Copenhagen. Instead, their analysis and forecasts should be labeled what they are, bold promotion marred by giant lies…
Here is a very good article by Dean Baker on the Housing Bubble.
http://coffeehouse.tpmcafe.com/blog/coffeehouse/2007/jun/28/deflating_the_housing_bubble
This item struck me;
” The inventory of 4.4 million unsold existing homes is equal to 15 months of sales at the pre-bubble selling rate.”
As credit tightens, we should expect sales volume to return to normal far quicker than prices. So I think Baker is right here to look at inventory and compare it to a traditional market. Not the bubble market we’ve had the last 5 years, which is what the NAR does and the press reports.
15 months of supply! That is a collapsed market.
I tried to post this about an hour ago - Last week somebody had a link to REO’s at Countrywide Funding that showed that had a trillion dollars of real estate. If they still own them in a few months will they be able to pay the property taxes?
The taxes will accrue and they will pay them when the house sells. It usually takes years for the taxing authority to take a house for non-payment of taxes. Still, it makes you wonder why no sub-prime loan has tax or insurance impounds! I will be they soon will have them on every loan.
Did anyone see The Office last night? Steve Carrell was snookered into signing an adjustable 30 yr. mortgage when he thought he had been approved for a 10 year fixed.
One of his staff said: Committing to a 30 year mortgage at his age is like paying down a coffin…with thin walls.
Art imitates life.
Implode O Meter hit 92 this morning.
Latest one to cack….Wells Fargo subprime correspondent operations as of this morning.
Will Neil buy us more popcorn soon?
“Subprime has been contained!….all is well….as the stampede heads for the exits.”
Popcorn for everyone!
Holy cow! The big one fell… Ok, Wells Fargo itself is a AAA rated bank that will be the last US bank standing… but at least they have exited subprime.
BTW, I love the “subprime has been contained” swipe.
Bwaa haaa haa!
I’m sharing the popcorn today!
Neil
Yes Neil, Stagecoach is a big player and will take awhile for the wheels to come off the axles….
Think the Germans got a woord for it… Schadenfreude…..
This comment…Brought to you “buy”:
Neil’s “All American Buttered Debt Derivative” Popcorn!
Thanks Neil! …very tasty…
Local realtors now under investigation (1st office closes, then foreclosures, then IRS tax liens and now this):
http://bakersfieldbubble.blogspot.com
Allco Credit Union reports steep loss
Subprime mortgage mess takes toll on West Allis lender; consultant called in
http://www.jsonline.com/story/index.aspx?id=625779
It’s everywhere.
Man, even credit unions.
What’s the FDIC insurance limit on deposits at any one bank these days? Did it ever rise above the old $100K amount?
It’s still $100k. Credit unions are insured by the National Credit Union Administration:
http://www.ncua.gov/Publications/brochures/insured_funds/funds.pdf
FDIC:
http://www.fdic.gov/deposit/index.html
While you’re there, check out all this good advice:
http://www.fdic.gov/consumers/consumer/index.html
If you’re married, you’ll get $100k each, unless you really screw up. IRAs are insured separately.
One has to wonder how much this NCUA/FDIC insurance really is worth. As far as I know, the insurance premium that the banks or credit unions pay is pretty minimal. If the sh*t really hits the fan, then there wouldn’t be enough in the fund, IMHO.
There will always be access to moneys - just turn on the presses. Or as Greenspan said, “I can guarantee the payments, I cannot guarantee you can buy anything…”. Also NCUA and the FDIC do not guarantee the interest.
still 100K everywhere afaik.
FDIC insured items:
“… accounts in different ownerships (such as beneficial ownership, trusts, and joint accounts) can be considered separately for the $100,000 insurance limit..”
http://en.wikipedia.org/
search fdic
a $5.2 mil Q1 loss for a 75 mil in assets credit union? WTF? Stick a fork in these guys, they’re done. That’s truely unbelievable…but just the start of things to come.
A bit OT: Someone made a comment yest. about the devaluation of the dollar vis a vis the yen. My question: if one were looking to buy a new Toyota (not me, I would buy used), would it be priudent to do it now over later? (For that matter, anything made in Japan?)
A lot of Toyota cars are made in plants North America. They just opened a plant in Texas to build their full size truck.
In fact, BMW is planning on expanding their production in a North Carolina plant. I believe this is to capitalize on the falling dollar compared to the Euro. Therefore, I don’t think there is a need to rush into buying a new car because of the falling dollar.
I would be more careful to see what is available based on the cost of gasoline. I have heard rumors/talk about diesel powered cars coming out the next few years that get considerably better mileage.
Carlsbad R, you are most assuredly correct about items that are manufactured in the US. But unfortunately for us a lot of the parts are shipped from Japan and assembled here. And costs in the US are going to soar. From yesterdays fed Minutes “Moreover, the high level of resource utilization has the potential to sustain those pressures.” It is naive to believe that inflation is coming down when almost every industrial metal has gone up 200%+ in the last 2 years. We have not experienced “pass through” yet. Industrial commodities are soaring relative to the dollar or are commodities truly unchanged relative to the rest of the world and it is just the dollar collapsing. Ignore China, their agenda is to find jobs for 10M people every year - China does not care about price, but to most currencies, oil is unchanged or down over the last 7 years.
Buy a BMW they last forever - well at least 20 years.
Hey, I made my ‘88 Plymouth Horizon last 19 yrs!
Actually that US BMW plant is here in Greer, South Carolina. Great company, great cars.
Yes you will see more diesels soon. We now have better diesel in the US (ULSD - ultra low sulfur diesel) which doesnt ruin catalytic converters and allows the cars to meet US emission requirements. VW will bring the diesel Jetta back soon and then hopefully a diesel Golf. Honda is replacing the hybrid accord with a diesel accord. The Golf would get 40-60 mpg depending on city/highway.
Undercutting the competition in Wash, DC. Ad refers to just one building at 1300 Army Navy Drive. The building is typical apartments maybe vintage 1950 - 1970 so fairly large. Used to sell for a song. As recently as a year ago saw one bedrooms there advertised for $400K - Are you kidding. Also the building is larger probably 300 - 400 units. Very high condo fees like $450 - $500. Should there be some economy of scale in large building? Maybe the insurance went sky high becasue of proxim. to Pentagon? — “THere are twelved one bedroom condos for sale in Pentagon city. Click here to see them all.. this one is the cheapest and one of the largest… ”
http://washingtondc.craigslist.org/nva/rfs/362933691.html
I live right near there. That’s kind of a junky-looking old building from the outside. $274k for 900 sq. ft. is way more than I’d pay. There is a much nicer, newer building right nearby, in which such a price wouldn’t be quite so bad (you can walk to the subway from there).
Even the mighty bemoth, Google, isn’t immune to the malaise surrounding the residential housing market. Check out number 2 on this WallStreet.com article:
Anecodotal Account of Mortgage Brokers using Google
I checked to make sure the article wasn’t about appraisers using Google Earth to do fly over appraisals…
Is it time to short RIMM?
Quel horreur! The spec house where I’ve been living is in fact now under contract to be sold. I’m so surprised. It will be interesting to find out how far off the original asking price the actual price goes, assuming the sale goes through. I’m told the new owner may wish STILL to rent to me - how odd - it’s a crappy “investment” but maybe he expects appreciation (I don’t). More on this topic some other time.
AZ, I’d lay you dollars to donuts that the new owner is betting his farm on appreciation. Same thing’s happening here in Tucson.
We also have a great deal of lot-splitting going on around here. What’s happening is that “investors” are buying double lots with one house on them. Then they turn around and put a “for rent” sign on the existing house, and start building a slapdash second house in back.
So, just imagine. You could rent a house that’s in a construction zone! Just think of the thrill you’ll have when you awake to the sounds of strangers traipsing all over the property, many of them in this country illegally. And you’ll savor the sounds of power tools, especially before 6 a.m. in the morning.
Needless to say, these houses for rent are just sitting there. As the construction behind continues.
I like to say that these “investors” are losing money, but making it up in volume.
The person renting the property is the one who owns the property rights. If you find yourself in this situation, you can simply ask the construction workeres to leave, then call the cops if they won’t.
He probably thinks he can raise the rent by $750 a month, too, just so he can still lose $1000/month.
Lawyer’s Sarasota office is focus of complaints
By TOM BAYLES
tom.bayles@heraldtribune.com
SARASOTA — The Florida Bar has filed a slew of complaints against a Tampa lawyer with an office in Sarasota.
One of the complaints stems from Sarasota resident Elizabeth Whitlock, who went to Hernandez’s firm for help in getting out from under a mortgage she claims she did not fully understand and could not afford.
Her complaint says that she gave $17,000 to the firm and no legal services were rendered.
the shylock listened didnt he? whats the problem?
You mean shyster. Shylock is the Jew in The Merchant of Venice. I know you didn’t mean to make an anti-Semitic statement.
(Btw, sometimes Google and/or Wikipedia saves my butt when I’m not sure if I’m using the right word.)
Here’s proof from San Diego that the homebuilders are not as greedy as you’d think after reading this blog:
http://www.voiceofsandiego.org/articles/2007/06/29/news/01kearnymesa062907.txt
It has long been the rumor that the Sunroad tower was build so high because the developers wanted Montgomery Field closed. This article touches on that:
“The controversy has deepened suspicions that the building’s nonconformity with the Federal Aviation Administration’s guidelines is an affront to the area’s industrial future: A way for real estate developers to reroute aircraft away from the building — or close the airport altogether — to make way for other high-rise development in the area.”
But they got it all wrong: the developers want the land so that they can build affordable housing:
“On the other hand, civic boosters have suggested that opening the airport up to development would solve the city’s affordable-housing crunch. They say the Sunroad saga has tainted a once-earnest discussion.
“I don’t think there’s any doubt that there’s a strong assertion out there that developers are ganging up to make this happen, and knowing the level of paranoia in this town, that’s a pretty significant issue,” said former City Manager Jack McGrory, who chaired a city panel in 2002 that suggested the airport as a potential affordable-housing site.”
I can’t wait to see all those $85k SFH go up in a few years. I hope the developers get this land for $1, as usual….
Anecdotal from Portland:
I almost had a “Falling Down” moment yesterday. I’d been watching a house near my old neighborhood that a flipper bought for $440K and had listed for $525K back in August 2006. It didn’t sell going into the holidays after being reduced to $475K, and was delisted. On January 1, it relisted at $509K (!!) and sat again for 5 months. I thought, “good. People aren’t stupid enough to buy that house, it’ll just sit there forever.”
I looked it up the other day and someone purchased it for $500K. Grrr!!
I used to really despise the people selling homes in this situation. Now, I’m insulted by the buyers. In their defense, they put down $100K so maybe people really can afford these places. On the other hand, and part of my reason for getting worked up, is that this is a half million dollar home one block from MLK Blvd. Not a pretty part of town. Five years ago, that would’ve been a $150K house tops.
Looks like the new buyer was caught in a “bull trap.” Buy in haste, repent at leisure!
I grew up in PDX, and back in the day, you pretty much could have bought that entire section of town for $500k.
Don’t fret, though. Just because a few people choose to play knifecatcher, don’t think that the crash isn’t happening.
That’s annoying. The same thing happened to me a few times, but now I’m sure it has to stop because there are 3 vacant houses on my street alone, and the one I’m living in is in preforclosure. This has to be the inflection point.
Hello All:
I just tried to find my landlords month-old notice of default on the county recorder’s site, but it’s not there. It was my understanding that the bank doesn’t even send the notice to the debtor until 10 days after filing it with the county recorder, so it shoud be there, right? Does anyone here know enough about the process to help me figure out how/when I can get the doc (or a record of it)?
Thanks,
Big V
Maybe contact a title company & see what kind of info you can get (buy?) from them. Find out who the lender is & what stage of F/C it’s in.
Good luck!
Arlington Va. 22202. Close in to D.C. and walking distance to the subway. One of the last places in No.Va. to see reductions, in my experience. Well, it’s started here. Just down the street from me is an old beater of a house with major problems that sold for $603k at the end of 2005, went into foreclosure last year, and just sold for $525k (after an asking price of $545k, from what I recall). Here is the county assessor’s page:
http://www.arlingtonva.us/Departments/RealEstate/reassessments/scripts/Inquiry.asp?Action=View&lrsn=55727
Folks, this has been a “hot” neighborhood, and this is the *only* house in this neighborhood that has sold since March, according to the assessor’s page. It’s hard to gauge prices, since it’s an older neighborhood where no two houses are even remotely alike (built from the ’10s to today). But things are starting to slip.
Today the yuan (RMB) is trading at 7.6145 to the dollar, one year onshore yuan forwards are trading at 7.26 to the dollar, 5 percent stronger in one year’s time. So you can buy the 1 year RMB bond yielding 3% and lock in the futures to receive ~8%. Have a nice weekend all.
Can you provide some info on how to buy an RMB? Thanks
“China Development Bank (CDB) announced Tuesday that it will issue five billion yuan (about 657 million U.S. dollars) RMB bond in Hong Kong, which is the first Chinese currency bond to be launched outside the Chinese mainland.
The two-year bond, which will be synchronously sold to institutions and individual investors from June 27 to July 6, yields three percent annually. The return is relatively high compared to the 0.7 percent interest rate for six-month deposit here, with the anticipation of RMB appreciation. …
Noting the renminbi is the fourth currency to go on the Real Time Gross Settlement (RTGS) System, Tang said this will facilitate the trading or the liquidity of the renminbi bond.”
RTGS is available through most major brokers and banks.
Why does it take family members so long to get ready to go camping?
I wanted to be gone an hour + ago!
oh well in the nonce - weekly unemployment update
Brookstreet Securities Corporation
Irvine, CA
In another fallout from Orange County’s subprime mortgage industry collapse, Brookstreet Securities Corp., an Irvine broker dealer, shut its doors and laid off 100 local employees because it could not meet margin calls on complex securities backed by faltering mortgages, a company spokeswoman said. The securities, known as collateralized mortgage obligations, lost value as Wall Street confidence in mortgage-backed securities collapsed.
Approximate Affected Workforce: 51-100
Capital One Financial Corporation
McLean, VA
Credit card company Capital One Financial plans to eliminate 2,000 jobs, or about 6 percent of its workforce, as part of a $700 million restructuring, the company said yesterday. The McLean company, which is attempting to diversify into banking from being the largest independent issuer of credit cards in the United States, said the job reductions would affect all parts of the company, including its British unit. About half of the employees being eliminated have been notified, said the company, which has 33,000 workers. Capital One, which has 720 retail bank branches throughout the Northeast, Texas and Louisiana, expects the layoffs to reduce operating expenses by about $400 million in 2008 and $300 million in 2009.
Approximate Affected Workforce: over 1000
Safe Auto Insurance Group Inc.
Columbus, OH
Sterling, CO
High turnover and difficulties recruiting staff led to the abrupt closure of the Safe Auto Call Center Tuesday and the elimination of more than 60 jobs. It is only after many months of analysis that we regretfully announce this decision, the senior vice president said in a news release sent from the company’s Columbus, Ohio, office. The office showed high levels of turnover, far exceeding the turnover averages from our other locations and it was difficult to recruit others to replace those people, she said.
Approximate Affected Workforce: 51-100
LSI Corporation
Milpitas, CA
Chip maker LSI Corp. said Wednesday it will cut roughly 900 jobs, or 13 percent of its non-production work force, as part of a restructuring plan. Separately, LSI said Magnum Semiconductor Inc. agreed to buy its consumer products business for an undisclosed sum. LSI said the job cuts and the unit sale are part of a business acceleration plan begun in April.
Approximate Affected Workforce: 501-1000
Rogers Corporation
Rogers, CT
Rogers Corp., a maker of specialty materials used in electronic and consumer products, on Wednesday lowered its fiscal second-quarter guidance and said it planned to eliminate 400 jobs to cut costs. The company said the decline is mostly due to lower sales in its custom electrical components and printed circuit materials segments.
Approximate Affected Workforce: 101-500
Tyco Electronics Corporation
Middletown, PA
East Berlin, PA
Reading, PA
Tyco Electronics Corp. announced the closing of its East Berlin facility and laid off 600 employees. As the transition from the East Berlin facility to other facilities in central Pennsylvania, South Carolina and China gets started, the company will phase out different sections of the facility, getting rid of both jobs and machines. Tyco Electronics Ltd. packed a one-two punch with its announcement Friday that it will also be closing its plant in Reading in March 2008. The facility, which employs 145 workers, will be shifting its production to Juarez, Mexico. It makes outside communications products sold to other companies for placement on utility poles.
Approximate Affected Workforce: 501-1000
Dubreuil Forest Products Limited
Dubreuilville, ON
Dubreuil Forest Products is laying off about 100 workers at its sawmill operation in Dubreuilville. The company is suspending one of its shifts starting June 30. Factors for the job losses include a decline in housing starts, low demand for lumber and a strong Canadian dollar. More than 90 per cent of the random-length spruce-pine-fir softwood lumber produced at the Dubreuilville operation is sold in the United States.
Approximate Affected Workforce: 51-100
Alsco Metals Corporation
Raleigh, NC
Roxboro, NC
More than 60 employees of Alsco Metals Corp. are going to lose their jobs at a plant in Roxboro, officials said Tuesday evening. Alsco, headquartered in Raleigh, is a 60-year-old company that boasts of being the largest supplier of residential aluminum building products in North America. Alsco wants to consolidate operations in Ohio.
Approximate Affected Workforce: 51-100
Briggs & Stratton Corporation
Milwaukee, WI
Port Washington, WI
Briggs & Stratton Corp. will close its Simplicity lawn mower and snow-thrower factory in Port Washington next year, eliminating some 325 jobs. Briggs plans to shift most of the work to McDonough, Ga., site of another of the three factories it acquired when it bought Simplicity in 2004. Though expected, Briggs said in late April that it might close its factory, the official announcement Friday left workers glum and wondering about their futures.
Approximate Affected Workforce: 101-500
Delphi Corporation
Troy, MI
Athens, AL
Delphi Corp. will close a north Alabama auto parts factory that employs more than 1,000 people by March 2009, and cutbacks will begin almost immediately. The union said the plant at Athens employs nearly 1,400 union members and managers, while Delphi said the total employment was closer to 1,200 people. The company declared bankruptcy in October 2005 and said in court papers that it planned to close the Athens plant unless a buyer was found. It manufactures steering components and axles.
Approximate Affected Workforce: over 1000
Hanesbrands Inc.
Winston-Salem, NC
Hanesbrands Inc. will cut 5,300 jobs, or 11 percent of its current work force, and close nine sewing and assembly operations as it moves production to lower-cost sites in Asia and Central America. The underwear and apparel maker said Wednesday it will close plants affecting nearly 5,000 employees, mostly in Mexico and the Dominican Republic. Positions in Canada, the United States and Puerto Rico also will be eliminated. Another 350 management and administration positions will be cut, mostly in the United States. The Winston-Salem, N.C.-based company said the closings, which will cost about $42 million, are a part of an ongoing restructuring effort to make its business leaner and more profitable. The bulk of the layoffs will be in the Dominican Republic, where 2,500 jobs will be eliminated, and in Mexico, where about 2,200 workers will lose their jobs. Hanesbrands currently employs about 47,000 people.
Approximate Affected Workforce: over 1000
Springs Global US, Inc.
Fort Mill, SC
Lancaster, SC
Fort Lawn, SC
Springs Global announced today that it will cease bedding manufacturing operations in South Carolina and close the Grace plant in Lancaster and the Close plant in Fort Lawn. In all, more than 700 jobs will be eliminated.
Approximate Affected Workforce: 501-1000
Weyerhaeuser Company
Federal Way, WA
Claresholm, AB
Forest-products company Weyerhaeuser Co. said Friday it will close its plant in Claresholm, Alberta, Canada, and eliminate 85 positions amid the sagging housing market. The plant makes iLevel Trus Joist TJI joists, a structural framing material for floors. It is the smallest of seven THI joint plants Weyerhaeuser owns.
Approximate Affected Workforce: 51-100
Woodbridge Foam Corporation
Mississauga, ON
Corunna, ON
Woodbridge Foam Corp. will close its Corunna plant in December, resulting in the loss of 182 jobs. The manager of Woodbridge plants in Sarnia and Corunna, said Monday the decision to close the Corunna facility was driven by a number of factors. “This includes a shift in the energy management market from requiring an engineered premium product to a commodity-based market where lower-cost plastics are available which significantly erodes our sales,” he said.
Approximate Affected Workforce: 101-500
84 Lumber Company
Eighty Four, PA
The 84 Lumber Co. laid off 26 employees at its corporate headquarters Thursday, blaming the job cuts on a slumping housing market. Sales are down and, as you go, you look at programs you can put on hold or eliminate, and the unfortunate aspect of that is that there are people attached to those programs, a spokesman said. The company supplies building materials and services to professional contractors, announced a three-year strategic plan last year to more than double its annual sales to $10 billion. The plan called for opening 125 new stores in high-growth areas nationwide. The company also closed 67 underperforming stores.
Approximate Affected Workforce: 1-50
King Motor Company
Fort Lauderdale, FL
King Motor Company of Fort Lauderdale is selling off its Sunrise property and new-car dealerships and plans to relocate its management to another facility in Deerfield Beach, the company said Tuesday. Up to 99 employees will be laid off as a result of the sale.
Approximate Affected Workforce: 51-100
Limited Brands Inc.
Columbus, OH
New York, NY
Limited Brands said today it will reduce its home-office and New York City work force by 10 percent, or about 450 jobs. Currently, 3,500 people work in corporate and brand positions in the Columbus headquarters. These and other moves are being made to reduce expenses by $100 million annually beginning in fiscal 2008.
Approximate Affected Workforce: 101-500
Welcome to tapped out country.
AMERICA WAKE UP!
Does family member = wife?
Thanks for all your posts, Hoz! Hope you have a fun camping trip!