Bits Bucket And Craigslist Finds For June 30, 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.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
November 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
Ah, another Saturday with sign spinners galore, open houses everywhere and a chance to read the RE funny pages that have been spruced up so nicely now with glossies. Just another busy day in paradise. Careful with those small explosives now everyone.
My husband has gotten a new trademark client. Some “creative real estate” guru with big dreams. I told him to get the money up front
Good call. Is your hubby in prosecution?
Yeah. Patents and trademarks.
Ah, thus the comment the other day when I was ranting about switching from IP to crim.
Good business, though over the past few years one hears some talk of commoditization and offshoring - there’ll always be demand on the high end though.
Yup, same with a good friend up by Aspen who does graphics - established company that now wants to get even bigger - ha! I told my friend that it was an indication of the coming RE crash and she just said she thought it would be different there. Methinks the company is trying to get more glossy RE ads going because biz is slow.
I was in Palm Beach County Florida during the super bubble and I was even blown away by Aspen’s bubble. I guess it could be different there?!
I was watching the local Friday evening political punditry show here in the Tampa Bay area. The show was devoted exclusively to the Florida tax “reform” measures and all the panelists were all state senators or representatives from this area. All of them except one seemed to think the “super” exemption, if it passes the citizen vote in January, would give a boost to housing sales. Sheesh. Good luck with that one.
I did learn something interesting, though. No need for a state income tax in Florida, there’s plenty of money to go around. Also learned how crazy this “highest and best use” assessment on commercial property is. No wonder business is dying here in Fla. If you’ve got a little bait and tackle shop on the water, your property is taxed AS IF there were an 8 story condo building!!! As one of the panelists put it, it is like the IRS taxing individuals not on actual income, but the highest income they could potentially make (convenience store clerk paying the taxes of doctor, lawyer, etc.).
A couple of the panelists were against this “highest and best use” assessment and tried to do something about it, but couldn’t, which shows how much Florida politicians are in the pockets of builders and developers. Being taxed at “highest and best use” forces Mom and Pop businesses in desirable locations to sell out to development.
Since when are condos considered “highest and best use”? Who was the big mega-mega who decided that?
Who was the big mega-mega who decided that?
As always follow the… MONEY!
That’s exactly the kind of thing that’s killing old Florida. It’s sad. I’m not a Florida native - but it really pisses me off still.
Pisses me off, too, packman. I also saw a show yesterday about a mayor of Jacksonville (Delaney, I think) who was farsighted enough to cobble together a bunch of land along the St. Johns and other areas some years back and put it under protected status. I’ll bet a bunch of developers are gnashing their teeth over that.
It gets worse for condo owners on the water. It seems the Goveners “Golden Veneer” is wearing thin.
http://www.heraldtribune.com/article/20070619/REALESTATE/706190358/-1/xml&display=Doubleblowforcondos
If I were a condo owner, I don’t think I’d have an issue with the new law. It takes 80% of the owners to agree to sell out, meaning a minority of 20.1% could block the deal. It would probably have to be a pretty good offer to get 80% to accept.
The problem as I see it is: You bought your condo knowing that you could never “lose” it. If you have lived there for any length of time your taxes are relitivly low due to a constitutional amendment (SOH) that guarentees your property taxes won’t rise more that 3% a year. If you live on the water and are forced to sell you most likely will be unable to buy into another water front property. Plus your taxes will sky rocket because you lose SOH when you move. This law is to help developers “scrape older condos so that they might build “monsters”. It is also a way to circumvent SOH.
It’s not just killing Florida. It’s killing the country. The mega-corporations and financial interests, and the opinion-making outlets and political parties they control, are moving us toward a corporatist quasi-fascist state.
As long as you are a corporate quasi-fascist, this is a good thing.
“Being taxed at “highest and best use” forces Mom and Pop businesses in desirable locations to sell out to development.”
No need to use cattle prods to herd the formerly middle-class along.
Stripping them financially works even more efficiently.
Of course, we all pay more taxes once the development goes in, once the stormwater is screwed up, the reservoirs polluted, more miles of fresh water and sewer and electric must go in, etc, etc.
Economic suicide.
OT - Palmetto. I went to USF one semester back in the mid 80s - I didn’t have a car and was totally hosed - nothing around the campus at all, had to get a bicycle to be able to even do anything. Is it still like that (doubtful)? What’s there now?
We are suddenly seeing the bad side of highest and best use. Citizens wanted this during the previous booms as more govt. entities took their property for roads and public projects. Citizens wanted the land, the govt was taking and improving, assessed at the highest and best use to get more eminent domain money from govt. Now that it is effecting more mom and pop places we have more people b**ching. CITIZENS OF THE STATE OF FLORIDA, YOU CAN’T HAVE YOUR CAKE AND EAT IT TOO.
Home Values Slashed in Half? The Housing Bubble Is About to Burst
By Dean Baker, TruthOut.org. Posted June 30, 2007
A somber tour of the housing market.
The latest data on housing sales showed that the inventory of unsold homes climbed to 4.4 million in May, yet another record. The current inventory would be more than a full year of housing sales in the mid-nineties, before the housing bubble began to take off. There is also a record inventory of new homes for sale. Economists usually expect that excess supply leads to a drop in prices, and in this case, there is a considerable excess >>>>>>
>>>However, many homeowners followed the advice given to them by Realtors, politicians and financial advisors, and were simply pursuing the American Dream of homeownership. When the wreckage from the real estate bubble becomes clearer, these “experts” will have much to answer for.>>>>>>
http://www.alternet.org/workplace/55384/
“homes in the most-inflated markets could lose 30 to 50 percent (in real terms) from their bubble peaks. Some people bought homes in these markets expecting to make great returns on their investments. Perhaps these people deserve their fate.”
I think these people do deserve their fate. I like Baker’s columns, but I don’t agree that realtors, politicians and financial advisors will answer for anything. If FBs learn anything from this bubble, I hope they learn something about personal responsibility. Maybe it is sour grapes on my part, I had to learn that somewhat bitter lesson myself many moons ago (not in housing, but other financial matter), but I’ve never forgotten it.
Good article and good site. Thanks for posting, Key Lime.
On yesterday’s thread some of you wished for parks and preservation instead of development…… Sadly the opposite is happening.
The Rich Have Priced the Outdoors out of Everyone Else’s Hands
By Barbara Ehrenreich, Barbaraehrenreich.com. Posted June 30, 2007.
As mansions increasingly eat up the coasts and hillsides, an old saying rings true: “If a place is truly beautiful, you can’t afford to be there.”>>>>>>>
http://www.alternet.org/story/55525/
Awesome and sad commentary. Reminds me of the report Ben posted not too long ago about the mobile home park somewhere on the water in Sarasota (not sure if it was the Myakka River or the Gulf) that was being purchased by a developer who said mobile homes shouldn’t be on the water, or something like that. You don’t wanna know what I’d like to do to that developer….
Wonder how the American Indian felt as they watched the land being taken away?
Same as the aborgines felt when England made a penal colony of Australia.
Reminds me of that clip from “Last Comic Standing”: “Wonder if the Native Americans wish they’d had a better immigration policy?”
“Wonder how the American Indian felt as they watched the land being taken away?”
Wonder how the tribe felt that was having their land taken away by another American Indian tribe. They probably got slaughtered first so they probably didn’t feel anything.
Wonder how the American Indians feel owning casinos?
Probably a similar feeling to the feeling renters have when SFH prices drop like rocks…
Zee chermons kall it Schadenfreude.
Many years ago the good people of Oregon ptotected many areas along the Pacific coast. Yes there are big houses in places, but that coastline has many parks and waysides along it.
Yes, and then OR passed Measure 37, (recall Initiative 933 here in WA, last election cycle? Based on 37) And this lovely measure requires govt. to recompense private property owners for any ‘value’ removed by govt. regulation. Little things like zoning, protecting streams and wetlands from becoming septic drain fields, stuff like that–that’s a ‘taking’, and you can demand financial recompense. Or a waiver of the regulation. Just about the most wretched idea ever.
Hello, anyone, want a nice drink of your neighbor’s pee? How about a 337 unit subdivision in what was a small cow pasture?
Isn’t that true of everything fun? I remember when I used to go to about 5-10 concerts/sport events a year because at $30-40/pop it was no big deal. Now when I look at event pricing, I decide its not worth it. The rich have cornered everything fun.
I went to an SU lacrosse game for $8 recently and had more fun than I’ve had in years. But now scalping is allowed in NY. So much for that.
I was lamenting this same problem with a ski instructor friend of mine about skiing. When I was a kid, it was a fairly reasonable sport, now the prices of rentals and lift tickets are outrageously priced. He personally hates it, as his clientelle have become increasingly wealthy and dull.
Not to sound elitist, but to those of us who grew up in Colorado skiing from a young age, the sport has morphed into something pretty distasteful - not the sport itself, but the crap that surrounds it. Lots of my ski buddies (and myself) refuse to pay the prices to ski with a bunch of clueless numskulls (trying to be nice, here), so we just go snowboarding in the mtns on our own (we all have extensive avalanche training and stay away from hazardous areas) - it’s free and we don’t have to pay $20 for a dried up instant meal. plus we can enjoy nature w/o contributing to its demise. OK,rant off.
Tried to post this earlier, my apologies if it shows up suddenly out of the ether - I recall mtn biking around the White Rim (Canyonlands Natl Park) for several days a number of years ago with some friends. We were sitting around the campfire speculating as to how soon only the weathy would be able to afford what we were doing (on the cheap) - price of gas and park permits, etc.
Same here except it’s cross country skiing in the Sierras for me.
“When I was a kid, it was a fairly reasonable sport, now the prices of rentals and lift tickets are outrageously priced.”
When I was a young skier in Lake Tahoe, CA one had to endure long lines at the lifts, and poor snow during drought years. Now we have the high speed quad chairlifts and snow makers and top notch grooming. Like skate boarding, skiing has improved and costs more.
This is direct effect of rising income inquality.
Activities which used to be within financial stretch for a large swath of the population have now become more ‘exclusive’ as the gap between rich and average widens to a gaping chasm.
I recall bicycling for several days in Canyonlands Natl Park (White Rim) with some folks from Boulder. We were sitting around a campfire just really enjoying ourselves when one wisecracker said we should capture the moment because there would come a time when only the wealthy would be able to afford the gas to drive to such places. He will probably be proven right.
Don’t know about in general, but the Utes here in Colorado are getting rich. They just bought a huge gravel pit near Montrose and are supplying the builders - there’s a bit of irony there, seeing how this area was once their wintering grounds and they were very bitter about losing it.
Anybody heard of supply and demand? Sports teams, ski resorts, etc. charge what they do because they can and still pretty much fill their venues. If you were to impose an artificial limit on ticket prices, then the black market (a.k.a. scalping) would determine the true price. And it’s usually some insiders who get to buy the tickets at the artificially low price and then turn around and scalp them.
yikes - that last comment was supposed to go under “Wonder how the American Indians feel owning casinos?”
Sorry about the double post above, that’s what happens when you use the espresso cafe’s WIFI - it drifts -
The only way to prevent poor people from getting locked out of beautiful places seems to protect the place by a requirement of actual physical work to reach it. If you build a road to everywhere, more people come and demand drives prices up. Make an area, on the other hand, bicycling only, and you will be able to enjoy it forever(?).
http://www.larouchepub.com/other/2007/3427mbs_cdo_crash.html
Bear Stearn’s Fund Failure Opened the Door to a Credit Crash
From the article above:
“This liquidity pullback [caused by CDO implosion] has devastating implications for the hedge fund- and private equity fund-driven mergers and acquisitions wave, one of the only things that holds up the bloated world financial bubble. (Last year a record $4.1 trillion were consummated, and this year the pace was set to exceed that.)
On June 28, the Carlyle Group, the giant buy-out firm, “postponed” the $415 million Initial Public Offering (IPO) that it planned for one of its funds, and reduced it to $300 million. MISC, the world’s largest owner of liquified natural gas tankers, cancelled a $750 million bond offering June 27 Foodservice, the American subsidiary of the Dutch supermarket giant Ahold, had to cancel a $650 million bond offering required by its takeover by KKR. The pall cast over all CDOs—not just those based on mortgages—by the failure of the Bear Stearns funds, had spread over junk bonds and commercial bonds generally.
However, there are further consequences. The failure of CDOs, and the associated credit derivatives, has the potential to rupture the $750 trillion-plus world derivatives market—a rupture which would instantaneously bring down the world financial system.”
To all those people who say Metro DC (or any other area) is different I give you this from the Washington Post:
http://tinyurl.com/25dt4l
Enjoy!!
“Foreclosures normally come amid economic downturns, when people lose manufacturing jobs or when regions are devastated by a natural disaster.
The surge in foreclosures, in relatively good times, can be traced to risky, so-called subprime mortgage loans made to people who stretched too far to purchase homes in an inflated real estate market.”
We have heard again and again about how unusual it is to see this big spike in foreclosures with no economic downturn in sight. Being the skeptic I am, I have serious doubts about whether this is a particularly unusual way for the cycle to unravel. For example, the Florida Land Boom of the 1920s went bust in 1926, three years before the Great Crash on Wall Street. I will not be surprised if Wall Street is in the tank by 2008, three years after the Housing Bubble began to deflate, thanks to leverage run amok with no underwriting standards. I see little difference between the problems facing CLOs, MBS, CDOs etc. in this lax regulatory environment.
It’s by our favorite Kirstin Downey.
I like this quote:
“Now many immigrants who bought homes in Herndon are walking away from the properties, said Miguel Martinez, a real estate agent with Prosperity Realty. He said the good-paying jobs they had in residential construction have disappeared, and they can’t make the payments any more. Many undocumented workers also fear anti-immigrant sentiments in Herndon, Martinez said, and worry that they or their relatives could be deported if arrested for other infractions.
“Now everybody wants to leave Herndon,” Martinez said.”
“Now everybody wants to leave Herndon,” ??
Yeah, but not because of housing….Just read yesterday that Virginia passed new traffic laws raising the fines 1000% or more….So now, if you get a ticket for 75 in a 55 the fine is $2500….They said they need the funds for road improvements…Now there is your government at work for you…Lets make the traffic violators pay for all the roads…Where does the greedy hand stop ??
I thought vehicle registration taxes, driver’s license fees, gas taxes, etc. are for building and maintaining roads. What is that money being used for?
For firing all the engineers ten years ago and then hiring them back at double or triple the pay as “consultants”.
For dumping routine road maintenance on the state instead of clearing that through the county or city level.
For paying inflated rates to old boy contractors who sew up the jobs so outsiders can’t get in, and then paying millions of dollars to an unqualified company to upgrade the computer system so you can get around the Federal Disadvantaged Business Enterprise requirement, except that it turns out this firm *was minority-owned, but it *wasn’t capable. Oops. Spend millions of dollars again for computer system that actually works. Find yourself years behind.
Spend millions of dollars on a mixing bowl interchange and cost commuters hours of their time every week, in order to save thirty seconds each way when finished.
Feel free to add to this list if you were sentenced to live in VA any time in the last decade.
MASSIVE INCOMPETENCE, POOR DECISION-MAKING, AND FRAUD.
Schools >; )
Opps, I thought we were talking about CA.
That’s the ‘personal responsibility’ assessment you’re talking about, and as a speeder, I fully support the law. As the legislature is saying, let those who are imposing the greatest costs to the public (in terms of police and emergency services) assume a significant portion of those costs. If ya don’t want to pay a huge assessment, obey the law. I’m cool with that.
The Florida land bubble of the 20s and the Depression of the 30s do not relate to each other in that way at all. The Florida swamp speculation was very much apart from what was going on elsewhere in the nation. At that time homes were very small and especially in the Florida swamps indoor plumbing was in barely over a quarter of homes there at that time. Most importantly, the Florida land crash was old news long buried by the time the markets soared in the late 1920s.
Wall Street is already having sputters completely integrated with this property boom which is nationwide and very intense in at least a dozen urban centers all over the US, not to mention internationally. Many factors make manias go out of control, but at the heart is a preference for sloppy math ahead of genuine reason and logic. That is why looking back at previous manias is so dangerous. There are always many shared factors, but no two manias are exactly alike. Globalization, just to name one factor, was just beginning to influence industrial society in the 1920s and now a huge percentage of items we buy are made in China using German industrial machines and Japanese robots. This is not your daddy’s housing boom or your grand daddy’s housing boom.
The door to the front of the house was propped open with a rope attached to the front railing to signify it would accept anyone passing by who wanted to rent a room. Tenants wandering in off the streets have plenty of options in Manassas: At the Global Foods grocery nearby, there were more than 35 handwritten fliers, most in Spanish, offering rooms to rent in homes.
That will really make the old hood a wanted place to be. Location, location, location.
An even lovelier picture from Springfield, VA:
“The house where Reyes and her family live was, at one time, a standard three-bedroom rambler.
Now, in each of six rooms, two or three mattresses are spread out on the stained carpet. There are bathrooms as well, and the garage has been modified so that it could be another bedroom.
In each bedroom there is a television and numbers hang above each door, motel-style. In the back yard, mattresses are stacked against trees, and water bottles full of what looks like urine are scattered across the yard.”
Wow, I bet the renters in the giant apt complexes by Franconia-Springfield station feel like geniuses now!
she’s poor w/ 3 husbands and 7 children? she needs her tubes tied - involuntarily
And her “husbands” need to be sterilized as well. Very likely they are not just procreating with her.
“Maryland Gov. Martin O’Malley (D) recently announced a $111 million loan commitment effort to help home owners facing foreclosure…”
That’ll help maybe 500 FBs. A drop in the bucket.
I know someone who works for a public utility in Maryland who told me he knows at least three people in his office (professionals, support staff) who are facing foreclosure.
Would love to see statistics as to how many foreclosures are toxic purchase loans, and how many are serial refinancers who have finally run out of equity.
I know someone who works for a public utility in Maryland who told me he knows at least three people in his office (professionals, support staff) who are facing foreclosure.
That’s pathetic. They made good money, but they spent like they were making 20% more…
Un-effing-believeable.
No stats on that, but a fascinating anecdotal read:
“…For what it is worth, none of the properties cited became an REO due to a subprime loan resetting, In fact, I have seen very few instances out there of foreclosure due to resets of 2/28 or 3/27 loans. The owners with these loans have thus far either quietly sold off at an acceptable loss or refinanced to die another day. The death knell is the HELOC….” This is from the Reno Realty Blog at
http://dianecohn.blogs.com/reno/2007/06/jaded-in-reo-wo.html
Totally O/T, but since many here have kids, & these toys are very common (have them in Barnes & Noble, too), thought I’d post it. (I know my kids have been chewing on these for the past couple of years…)
Recall of Wooden Vehicles and Train Set Components
In cooperation with the CPSC, RC2 has issued a voluntary recall on June 13th, 2007, of various Thomas & Friends™ Wooden Railway vehicles and wooden train set components sold at toy stores and various retailers nationwide from January 2005 through June 2007.
RC2 has determined that the surface paints on the recalled products contain lead. Lead is toxic if ingested by young children and can cause adverse health effects.
http://recalls.rc2.com/recalls_Wood_0607.html
Meant to add: “Made in China”
Someday, we might actually get back to valuing quality & safety over cheap junk made in third-world countries.
I’m all for trade, but it should be limited to countries who share the same beliefs WRT human rights, environmental concerns, safety, etc. Otherwise, it’s a race to the bottom.
That’s why I say globalization is THE WORST. IDEA. EVER.
Many people say we can’t stop it. Well, we stopped polio, didn’t we?
BTW, I’ve been reading about these hedge funds and their managers moving to Asia. And I say, good riddance to bad rubbish. And, once they move, NEVER let them back in the US under ANY circumstances. Shut ‘em out of US markets. Let ‘em pull their shenanigans in China and get a little taste of Chinese justice.
The US needs a Klingon cloaking device like yesterday.
“The US needs a Klingon cloaking device like yesterday.”
Uhhh, palmetto, that would be a “Romulan” cloaking device.
I am hereby stripping you of your trekkie badge and demoting you to a red shirt security officer on an away team.
“I’ve been reading about these hedge funds and their managers moving to Asia. And I say, good riddance to bad rubbish. And, once they move, NEVER let them back in the US under ANY circumstances.”
Like mob bosses still running their empires from prison, these pig men will still have their fingers in our economy. They’re only physically in Asia to avoid repercussion.
I’ve been reading up on the former Soviet Union, how in the last days of the USSR the symbiosis between the “Mafyia” and the State, and later the financial-industrial tycoons, became to intermeshed it was almost impossible to tell where one stopped and the other one started. It seems like we’re moving toward the same situation here.
Does anyone remember when Richard Grasso, head of the New York Stock Exchange, traveled to Colombia to meet with the FARC? Supposedly he was there to talk peace, but when has “peace” ever been a Wall Street priority? On the other hand, the FARC has a very lucrative commodity - cocaine - that one can surmise Wall Street would love to get exclusive distribution rights for, especially as their other “investments” are collapsing.
http://www.larouchepub.com/other/2001/2848dope_money.html
Dope, Incorporated - The real movers and shakers behind the global drug trade.
Enough of the Lyndon Larouche stuff already.
Ugh, this description of the end of the Soviet state is greatly distorted by an agenda. This intertwining with industry they had was like giving a starvation victim a nutrient IV drip. Productivity was negligible. Even the rich had trouble getting toilet paper. I was there and saw what an utter wreck our ultimate foe was. Standing up to Communism was important, but in the end it became just another excuse to kick the Russians when they were down just like everyone else does. We have a lot of problems in the US, but to say “It seems like we’re moving toward the same situation here” is horrifically ignorant. Let me know when you have trouble finding toilet paper, comrade.
The comment about the Romulan cloaking device reminded me of how it was the Romulans who developed the technology, but the Klingons who became known for it because not only did the Klingons buy them off the Romulans, but the Romulans, needing to expand their fleet quicky (*cough* the producers had only one Romulan model and apparently didn’t know any basic film school tricks *cough*), contracted with the Klingons to purchase cloak-equipped Klingon light cruisers, as seen in “The Enterprise Incident.”
These are the same ships that had the tendency to blow up in giant fuel-fire-balls in minor skirmishes with Federation heavy cruisers.
So, even in the 23rd and a half century, globalization has its issues.
Eventually the Romulans stopped talking to the Klingons, and started building their own heavy cruisers again. Hope?
The US is supposed to be like the Federation, of course, with its network of heavily integrated trading partners. Just what these folks are trading in the galactic market isn’t terribly clear, although it seems like Earth is in the pleasant position of selling high-tech stuff, assembled in the Solar system, in exchange for valuable raw materials as well as some biologicals for the pharmaceutical industry and pretty artifacts for the consumer market.
Today, in the US, we seem to be trading FIRE & marketing “products” for high tech finished products. Not very sustainable. (But neither was the Federation. What happened when those client states–even the ones you tried to keep from learning your tech secrets through the “Prime Directive” doctrine–start manufacturing their own stuff? Utopia? Er…)
I think Bill Clinton was watching a little too much Star Trek … but not paying enough attention.
WHO thought it was a good idea to send the semiconductor industry to Taiwan, now?
Yes, Palmetto, we did eliminate polio, but it’s re-emerging in Muslim countries thanks to insane clerics telling people not to let their children be vaccinated, because the vaccines will make them sterile and sick, and are a U.S. plot to kill Muslims. Christopher Hitches describes this fiasco in his new book, but I posted links here a few weeks ago to articles dealing with the problem.
I don’t think ANYTHING from China should be allowed into the country till it has been checked for every possible contaminant. I have a large, optically flawless solid quartz sphere (crystal ball) from China that would have cost at least fifty-thousand dollars had it been ground down from natural quartz, but which only cost about a hundred dollars because it was ground down from laboratory-grown quartz (supposedly purer than the natural). I won’t even handle it because I don’t know what else might have been added to the supposedly perfect formula (besides, it’s too heavy to leave out; it could hurt my pets if it fell on them). I wonder what kind of lab I could take it to for examination (without potential damage).
What does your crystal ball tell us about the future? What do you see?
This is ot, but does anyone have a web site with all the contaminated items from China listed? Seafood, tires, children’s toys, garlic, vitamins, apple juice, pet food, etc?
While I wait out the blowout in my rental, I would like to not poison myself to death.
Hi WAman. I’ve never tried to use it, though I had a great book on crystal gazing long, long ago (Theodore Besterman’s “Crystal Gazing”). I don’t want to know the future; it might be horrible. As far as I do know, most scrying (using a reflective substance for paranormal imaging) isn’t aimed at fortune-telling, and the images might not be worth anything in any event.
The FDA site lists a lists a lot of stuff that HAS been recalled, but I don’t think it lists those that SHOULD, or might be.
Why stop at globalization?
I don’t understand why we trade with other states. Why can’t every state have a steel industry?
Not all states have the raw materials to begin with, natch.
Ah “gator” how stupid of me.
So why not every state with its own car, computer, appliance, furniture, corn, wheat, sugar, dairy industry?
That sounds dumb too, no? So, what’s the difference between cities trading between cities, states between states and countries between countries?
If you’re going to suggest limiting trade makes sense then why stop at “globalization”? Why NOT limit it between, say, NEIGHBORHOODS?
Your argument holds only when everyone holds to the same standards of production, trade, quality, and ethics.
well, since capitalism is obviously failing, i guess we need a World Court to create and a Global Army to enforce strict, fair business practices worldwide.
That’ll teach those Chicoms who’s boss.. who do they think they are anyway.. trying to profit from and take advantage of other countries weaknesses.
Yep! Capitalism is failing. Bring on Stalinism! And who is “Santayana” anyway?
These extreme responses (re: Stalin, communism, etc.) do not address the issues regarding globalization.
Guys…there is a middle ground. Don’t know why many are so narrow-minded, to the extent that they cannot see beyond what’s already been done.
There is a lot to be said for “public” control of necessary goods & services, while privatizing everything else. When I say “public” control, I mean public, NOT under the control of any political party or supposed “representatives”, etc.
Additionally, there is no reason, even under a semi-socialist system, why there cannot be rewards and bonuses to those who perform above & beyond their duties.
Too much to discuss here on this blog, but people need to open their eyes and their minds to what’s going on around them.
> I say globalization is THE WORST. IDEA. EVER.
It doesn’t get more true by repeating and SCREAMING it.
For all to you who have children: Thomas sucks, and not only because of some lead in the paint - Thomas is such a dorky character, always better than the others and without fault. If you want some wooden trains, BRIO is a nice alternative, maybe there are more out there (I have no financial interest in BRIO).
I have at least 4 customers that either have two homes, trying to sell one, or are trying to sell a single home…They are all under water…These are very young folks that got caught. They are not speculators…I told my wife they dont own real estate, they own real escape.
They need real “escape”.
“These are very young folks that got caught.”
Please explain this sentence. It appears that you are looking for sympathy for these GFs. If they could afford all that they bought, then a downturn should not matter. They just keep moving on with their lives. If they couldn’t afford what they bought then they are indeed “speculators”. Which is it and why are they selling?
Lighten up Francis…Nobody said they couldnt afford it…They
were changing jobs and got caught in the turn…They simply want to sell their homes…no more no less.
Written like a true “economist”. Say “hi” to Lawrence Yun at your next meeting.
Written like a true NYorker…Say hi to all the aholes up there for me.
Sorry economist, if they’re changing jobs and are underwater, sounds like they didn’t have the tradional 20% down payment, thereby fitting my definition of THEY COULDN’T AFFORD IT (and hence were specivestors). And they don’t have to worry about it being sold…eventually the bank’ll auction it off and then they’ll learn the true market price of their alligator, with a BK to memorialize their new title of GreatestFool. Oh this show just keeps getting better and better.
Got diversified assets?
“Nobody said they couldnt afford it”
If a forced move puts them underwater, to me that means that they “couldn’t afford it”. Maybe they should have had a down payment, or maybe they should have rented until their job situation was stable?
Or were they lured into the market by “real estate always goes up”, “buy now or be priced out forever”, and “you can’t lose buying real estate”?
These guys are all special forces military…They are elite fighting guys, but they obviously dont stay tuned to the markets…They shouldnt have purchased…I agree…They are able to make their payments, but they are in a bind…
I do have a soft spot for these guys….But hey, they probably learned a good lesson here.
Godwin’s rule updated to the 00’s.
OT, but did anyone here get an I-Phone?
Would anyone here admit it if they did?
Yes, of course I am typing this response on my new iPhone as we speak!!!!! I love it so far!!!!
and it is almost as addictive as Ben’s blog…that’s really saying zomething!!!!!!
something
not until I get get exchange email
I am typing this on my iPhone. I’ve owned Apple stock since 2001 and figured I owed it to Jobs after he funded five years of my retirement.
I thought of the bloggers while watching local coverage of the i-phone sales:
Reporter asked the Abercrombie clad blond teen/early 20 something at least 3 times if the price bothered her at all. No. No, not at all, she announced.
I’m thinking, at her age, she was not the one footing the bill. 3 of her Abercrombie’d friends looked on from behind nodding in agreement.
She merely withdrew some money from The Bank of Mommy & Daddy. Of course The Bank of Mommy & Daddy is not nearly as well capitalized as they were back in the summer of ‘05. I wonder if Buffy, Hunter, Schuyler and Scout will understand this concept when the funds run dry.
U S consumer gadgetry…. never understood it, never will.
Compared to Japanese consumer gadgetry, we Americans are minor leaguers.
As I watched all those people on TV waiting in line to buy an iPhone, I laughed out loud, thinking: Those are FB’s waiting to happen. Same sheeple, different product.
– Judge Smales
“You’ll get nothing and like it!”
I will NEVER buy one at $499 - $599 for a F!@#$!ing phone ??? Gee I could get a replace the current clunky LAPTOP for that amount of $ The Hollywood hype machine at its finest ! Steve learned a lot at Pixar I bet within 6 months the Iphone will be a worthless BRICK! Another shrill working to part the $ from the sheepie (think FB & IO ARM)
I’m waiting two years … price should be nicely down by then and the bugs ironed out.
I thank all the early adopters … I couldn’t will have done it without you guys *sniff*
Exactly my thoughts. Additionally, after two years we will know how useful it really is.
Well, I wouldn’t buy at those prices either, and being somewhat of a Luddite, prob. never would buy. But now, if someone were to give me one for my birthday or something, I’m sure it would be cool. But if someone can afford it and wants to have fun, why the beef?
Two of them.
AT+T.. no thank you.
I’ll wait for the dust to settle.
MSM accounts are clouded with lingering doubts about whether subprime fallout is contained. The Bear Stearns meltdown and subsequent media followup reminds me of the aftermath of the Chernobyl meltdown two decades ago.
S&P 500 Stalls on Concern Subprime Losses to Worsen; Dow Gains
By Nick Baker
June 30 (Bloomberg) — The Standard & Poor’s 500 Index was little changed amid heightened concern that losses from loans to the riskiest borrowers will mount, while the Dow Jones Industrial Average gained, capping its biggest quarterly advance since 2003.
Bear Stearns Cos., Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc. led financial firms to the second- steepest retreat among 10 industries in the S&P 500. Bear Stearns this week said it would spend $1.6 billion to bail out two hedge funds that made bad bets on bonds backed by subprime mortgages.
“The issue with subprime could be far-reaching,” said John Davidson, who helps oversee more than $11 billion as president of PartnerRe Asset Management in Greenwich, Connecticut. “The week has been focused on what’s going on at Bear Stearns. The thought was that this could affect the housing market, the consumer and the overall economy.”
http://www.bloomberg.com/apps/news?pid=20601087&sid=aertX06PH7_0&refer=home
Hi GS,
Here is another interesting piece about CDOs. It’s rather long, but towards the end of the article, it explains how CDOS work(which is nice for those like me who don’t understand a lot of the issues with CDOS), and most alarmingly says that because of the extreme leverage in these funds that if 5% of the mortgages held by a fund go bad, the entire fund is toast.
http://market-ticker.denninger.net/index.html
Sorry if already posted (I may have seen this article here a couple of days back), but I am interested in any comments readers can offer on the greater St. Louis housing market. Unfortuntately, my sister owns two houses there, and needs to sell one soon into the downturn (in St. Peters).
Slumping local home market reflects national slow down
By Riddhi Trivedi-St. Clair
ST. LOUIS POST-DISPATCH
06/26/2007
Signs such as this one at a home on Sutherland Avenue in St. Louis have been staying up longer.
(J.B. Forbes/P-D)
The national market for existing homes remains mired in a slump, and the St. Louis market hasn’t bucked the trend. Indeed, compared with sales a year ago, the local region fared worse than the nation.
http://www.stltoday.com/stltoday/business/stories.nsf/0/B9DBE6C7C0A514138625730600139CD7?OpenDocument
From the Syraucuse.com Real Estate discussion forum:
624. 2007 Market predictions-foreclosures
by re7012,
6/29/07 15:07 ET
I work for CurrentForeclosures.com and we have been seeing a huge increase in the number of foreclosures across the nation over the past year. I believe that is is mainly because of subprime lending and ARM loans-and the ARM interest rates are set to rise early next year for a large majority of homeowners. I don’t think that the market will turn around until mid-2008….what are everybody else’s thoughts?
624.1. I believe your
by Roadblock06, 6/30/07 7:46 ET
Re: 2007 Market predictions-foreclosures by re7012, 6/30/07
right about the subprime market and ARMS. Now HUD is trying to take away Down payment programs away from buyers. The market is saturated with homes both foreclosures and regular listings just sitting on the market. Banks are now fixing up these foreclosures and selling them at market value rather then letting them sit AS IS condition. They are pushing investors away I beleive.
I think we are going to see a vareity of changes throughout these coming years and already seeing changes in the Sub prime market, stricter guidelines for Stated, NINA, 203k programs, and companies shutting down.
All this due is to a minority of investors taking advantage of certain loans, and Refi’s, lenders who don’t explain disavantages of interest only loans, ARMS, or just getting them the loan that looks good in the beginning to people who can’t afford it altogether. Appraisers who fudge the #’s onlt to find the house is worth less then it really is.
Yea, we have a problem BUT I think we will get through all this. Just to bad the investors, lenders, appriasers, sellers and buyers who are on the upand upwho are the majority have to suffer…
624.1.1. We are seeing more and more
by FreqFlyer, 6/30/07 9:15 ET
Re: 2007 Market predictions-foreclosures by re7012, 6/30/07
foreclosurers here in my area. Never in my life have I seen so many homes closed up with extremely overgrown lawns. Nice looking houses, too. How sad that the American dream of home ownership was pulled out from under these homeowners. Of course, too many purchase homes at the top of price limit not taking into consideration that the real estate market might slow or rollback making their home worth less than the mortgage….
I can understand why banks are fixing up these homes, hoping to sell at market value instead of discounting the houses where flippers could find a great bargain. Many of these homes have back tax debt and unpaid utility bills that are owed.
(I believe FreqFlyer is in the Carolinas). If anyone wants to respond:
http://www.syracuse.com/forums/realestate/index.ssf
http://www.larouchepub.com/other/2007/3426toxic_waste_banks.html
Bear Stearns Crisis: Wall Street’s Toxic Waste
The most beautiful thing I’ve seen in a long time. It brings a tear to my eye.
http://tinyurl.com/2yp8qc
Test….
Reminds me of bungee jumping w/o a cord.
And that is just closing…. Add another data point of $36.45 to the front, the original open.
Actually down 19.7% from the initial open, not the 16%-ish that the chart shows of closings.
Or, if you go from “expected open” that was being tossed around the night before when the shares were priced at $31… that expected open was over $40. We’re down 50% from what the insiders were hoping to make.
Yes, the Chinese bought a pig in a poke. That should encourage them to stay in T-bills and keep interest rates down. BX is a joke. Worse than FIG.
The New Rich Are Building Bigger
“Warren Buffet still lives in the same Omaha, Neb., house that he bought in 1958 for $31,500.”
Yahoo
http://tinyurl.com/yvlu6h
Yeah, and Buffet stays there, what? Two days a year?
The rest of the time he’s in a luxury hotel suite. Don’t get me wrong, I admire the guy but he’s a bit removed these days from the Omaha scene, no?
Buffet had a big, beautiful house in Laguna Beach, CA overlooking the Pacific. Had Prop 13 taxes on it from 1960. Do you really think asnybody wants to really live full time in Omaha??
Hell of lot better than the “flakes” in California who are trying to impress eack other with their big, let me show you what I have bought today, living. California is the top bubble in the nation and is bringing down the values of all the houses as flippers/buy more than you can afford to impress others crowd does. Still want to live in a state where taxes are going up because of a soon bankrupt state, with the highest upside down loans in the country ocurs? I think not.
‘Hell of lot better than the “flakes” in California who are trying to impress eack other with their big, let me show you what I have bought today, living.’
That sounds hauntingly like the prequel before the ‘87 crash and the death of the yuppy.
Pulp Fiction and Dead Spartans at Thermopylae
http://wallstreetexaminer.com/blogs/winter/?p=867
Russ,
love your blog. And pigman Marin is no Leonides. But where is Cioffi in all this? Is he some close, personal friend of boss Jimmy’s that he survives all this? Or is he too headed for Long Term Parking?
While Thermopylae was a great stand against incredible odds, let’s not lose sight of the fact that Sparta was an outright military tyranny.
It was a disaster for Greek civilisation when Sparta defeated Athens in the Peleponnesian War.
Asset inflation in residential houses way outstripping ability to pay for most people w/out using exotic mortgages. Incredible overbuilding/oversupply which still continues according to what I can see anectodotally in Ohio. Are there any sophisticated economists who are modeling this stuff without a bias towards preaching to the pro-development business community? Kunstler was never more accurate than when he described suburban (and now the urban condo boom) as the “greatest misallocation of capital in history.” He also had a graphic on a recent journal post showing that retail sq. footage per person is an order of magnitude (i.e., 10x) higher in the U.S. than in Europe. I really have trouble understanding commercial development practice–do the original developers and banks simply rake off fees than pass the risk off to the broader MBS market? This seems like the definition of “moral hazard”. Is massive over-investment in non-productive assets deflationary or inflationary? My instincts tell me inflationary, but its just a wild guess….
Normally deflationary. If the people who made the investments can’t pay their loans, banks fail and money disappears (or more accurately, reduction of available credit causes slowing of the velocity with which money changes hands and multiplies).
Only inflationary if the Fed prints money to bail everybody out.
Found on Craigslist… You can own this lovely, little, Roseville CA gem for only $230,900. Why, it’s even cozy! Just how cozy? Neither the CL posting or the dedicated site say, but Zillow says it’s a 1/1 and 740 sq ft. That is mighty cozy.
Zillow also says the last purchase was 8/2004 to the tune of $212,500. Lessee, $230,900 times the 94% left after Realtor’s fee is $217,046. I don’t think this was a wise investment.
Just buy a camper and a pickup and avoid those property taxes. Not much smaller, and LOTS cheaper (even if you buy new).
My sister used to live a few blocks away on the same street. It’s right next to the rail-road tracks and the trains blow all day/night. She had to wear ear-plugs to sleep at night.
The tone of this blog is quite festive today, full of merriment and prankishness, even. Is it anticipation of the approaching festivities of our glorious Independence Day? Or is it anticipation of the even more enjoyable and eagerly awaited and now incipient massive CDO explosion? Maybe both. Either way, I drove to the Squaxin Res this morning and got not two, but THREE, immense colossal mega blast-o-tron firework packs, turgid with pounds and pounds of illicit fireworks and assorted munitions! I’m going to patriotically celebrate America AND the irrefutably collapsing housing/lending bubble! With incredible style! If only my brothers were here. Alas, they are stuck in Utah, with inferior quality exploding things. Although that’s probably for the best.
Anyhow, Washington state posters, WAman, Bantering bear,–when you see that giant exciting fireball radiating wildly in the sky tonight over Olympia? That’ll be me! Those of you in California, maybe you’ll see it too. Heckfire, maybe palmetto will get a glimpse.
Just please don’t shoot off flares near the water. My Coast Guard watch standing friends used to hate July 4th…
Just don’t be going and burning anyones house down!
Oh, heavens, no. We wouldn’t want that.