Bits Bucket And Craigslist Finds For October 19, 2007
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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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Bad news from Wachovia in 3….2….1….
blastoff
http://biz.yahoo.com/ap/071019/earns_wachovia.html
In the quarter, Wachovia recorded a provision for credit losses of $408 million, up from $108 million, reflecting modest deterioration in credit quality, a more uncertain credit environment and loan growth. Net charge-offs were $206 million, or 19 percent of average net loans.
So long as they’re only deteriorating modestly, I guess there’s nothing to worry about.
“modestly”….does that mean they’re wearing a bhurka when they report these numbers?
How is increasing loss reserves by almost 300% modest?
I notice oil just broke $90. That’s going to hurt any SUV owners.
Got popcorn?
Neil
“I notice oil just broke $90. That’s going to hurt any SUV owners.”
Not sure if you were online yesterday but a few posters were noticing the barrel price didn’t seem to be reflected in pump prices yet. $2.85 here last time I filled up so I’m still under $50 for a minivan fill-up. Usually CNY is high. Someones eating it for what ever reason.
Won’t hurt the very rich,
Luxury luxurious again
Luxury is once again “the exclusive preserve of the very rich,” says Daniel Gross in Slate. Ten years ago, luxury businesses convinced “aspirational” shoppers to start trading up. But now, with a “credit crunch, poor housing market, and slowing economy,” America has fractured into three tiers of shoppers: working class, middle class, and ultra rich. And only the ultra rich are not cutting back. Wal-Mart is slashing prices 20 percent to draw shoppers, but Gulfstream and Ferrari dealers “literally can’t keep enough goods in stock.” In fact, in a 10-star world, “luxury businesses are now going to 11.” And shoppers “who don’t come heavy shouldn’t come at all.”
With respect to gas prices not rising due to oil prices almost doubling in the past year, I asked my friend who worked at Exxon (in their refineries). He said that for the past several years their margins have been through the roof (thus the record profits) and that they price gas at what people will pay such that they make the “maximum” profit. They discovered that there is a lot of resistance above $3.00/gal and so have kept prices just under that for most areas. They won’t raise prices again until their margins start to fall.
Each barrel of oil gets refined into many different products so perhaps they are charging more for heating oil or jet feul these days to keep their margins up?
CarrieAnn
Refineries (who were minting money previously) are back to more normal margins. The way to see how they are doing is multiply the price of a gallon of gas (don’t forget the tax) and compare that with the price of oil. This summer the spread was $20-30/barrel now it’s back to sub $5.
With such a low profit margin, the oil companies would be better off liquidating and investing in US treasuries.
“…According to the IMF’s World Economic Outlook, demand growth is expected to outstrip supply growth from non-members of the Organisation of Petroleum Exporting Countries (Opec) in 2007 and 2008. The International Energy Agency’s (IEA’s) revised forecasts point to a tighter market than earlier forecast. On the supply side, growth is expected to be limited, with non-Opec supply growth remaining at 0.6 million barrels per day in 2007 (slightly higher than the increase in 2006)….”
Gulf News October 20, 2007
http://tinyurl.com/36cqke
“They discovered that there is a lot of resistance above $3.00/gal and so have kept prices just under that for most areas.” The price of gas at the pump has nothing to do with the Nov, 2008 elections? Nah! Couldn’t possibly be a manipulated market? By friends of the president! Who would have thought about doing something so devious?
No way, Conspiracy Theorist. These guys care more about profit than bending to any politician. Plus, ALL the oil companies would have to be in his pocket.
Gotta disagree, Bronco - the value of a friendly politician to all the oil companies for another four years or more exceeds the value of a year or so of decreased profits.
My refinery engineer friend at V says, as mentioned above, that margins were great earlier and very low now. He also mentioned that refining capacity was low this spring (broken stuff) and everything is back on line now.
Don’t forget that Future price is ahead of spot, and spot is ahead of what’s in the tanker, and that is ahead of what’s in those huge tank farms.
Mikey, you may be right (and I would expect the effort to be there), but I still think it is a profit maximization, elasticity play.
On the “liquidate and invest in Treasuries” comment: Don’t confuse return on sales with return on assets. The oil companies have much higher sales than assets, so a 5% margin on sales is much better than a 5% margin on capital.
Wachovia has not even accounted for its purchase of Golden West. Once the Neg Ams start to fail with the phony accounting of income, sayonara.
I thought they were supposed to account for that purchase from the day of closing, by comparing what the 2 banks had done in the prior quarter IF they had been one. Is that not the case??
My bad, what I meant was that Golden West (World Savings) is primarily Option Arms. Option Arms show up on financial records as profits even though the bank has received nada, zip, zilch. Wachovia is still using this form of accounting. Most of World’s loans were in California. Wachovia has not accounted for these future losses, inadequate reserves (IMHO). Sure it is easier for the FB’s to pay the 1% option arms (with a yearly 7% increase in payment) until the loan adjusts after year five. Then the payments go from $1,700/mo to $4,500/mo. Real profits? not when the FB will walk.
Thank you Hoz.
That takeover was very expensive to me. Was short GDW (quite a lot) because of their 99% (?) exposure to CA mortgages, most of that in “exotics”.
I’ll never understand why companies buy out other entities that look (even to morons like myself) entirely unprofitable.
Neil! I own an SUV! And no, $4 gas prices won’t hurt me! I bought it to use for when I actually need an SUV. I’ve had it a year now, and only racked up about 2100 miles on it. It goes grocery shopping on weekends, to the dump when I need to get rid of stuff, etc.
SUVs should be used for their intended purpose! When you need a “utility vehicle”. If you need to use it as your main car, you can’t afford to have one! For commuting, you need to get a fuel-efficient, safe car.
It’s like those people with the HELOC’s hummers who drive it to/from work. There’s something fun about a hummer (at least an H1), but it only makes sense if you can keep it garaged except for the one Sunday/month when you take it for a spin or a special trip up a mountain. Not if you need to drive it every day.
And the H3 is just stupid. It says “I’m one of those people who thinks owning a Hummer makes a positive statement about someone—BUT I can’t afford a real one.”
Saw a poster in Seattle with the outline of a hummer on it and the caption was “F#@k you and your bling bling too.”
And the H3 is just stupid. It says “I’m one of those people who thinks owning a Hummer makes a positive statement about someone—BUT I can’t afford a real one.”
Now that’s just damn funny right there.
Given the level of consolidation in refineries in the US there is no way that they can’t jack up margins. They have been asked or they have decided to keep gas prices low to protect the economy. There was little to no drop in consumption this summer when gas hit 3 plus bucks a gallon this summer acording to all of the talking heads. Take a look at the profits reported by refiners when the price was north of 3 bucks a gallon. They were through the roof, and now they are down because margins are lower, but the arguement is the reason they are down is because they were making less money when they were high. It’s a lie.
Not so good for BofA either:
http://tinyurl.com/32svpo
“As the last of the nation’s top three banks to report results this week, Bank of America’s news suggests that the problems in the credit market may yet be closer to the beginning than an end. But while Lewis blamed some of his bank’s problems on those market conditions, he admitted his traders also made plenty of mistakes.”
“What I can’t say is that we’ll stay the course,” Lewis said on a call with analysts, after his company posted a 32 percent profit drop in the third quarter. “The probability of changes and eliminations of some businesses and infrastructure … is very high.”
“The probability of changes and eliminations of some businesses and infrastructure … is very high.”
Xmas pink slips?
“The probability of changes and eliminations of some businesses and infrastructure … is very high.”
Bwahahaha. Good thing they are building the Bank of America building on 6th Avenue and 42nd Street, kitty-corner from Bryant Park. That piece of infrastructure must have cost a fortune. Oh, by the way, the building is for their investment banking unit. And Ken Lewis doesn’t like the look of that unit. Plan during the boom. Move in during the bust. Ouch!
Not so good for BofA either:
But the good news is the American people have awoken. They are going to start hunkering down, spending less, working and saving more and paying off their mortgages before taking on more debt.
They’ll make their cars last for 10+ years, quit spending money on frivolous items in a futile attempt to convince themselves that they are worthy and find inner peace.
Chirp. Chirp. Chirp.
You do realize that would result in massive unemployment.
You just wiped out at least a third of the GDP.
You heartless b$#@terd!!!!!!
A quarter century of time and effort spent building out a gigantic consumption spending infrastructure and you have the unmittigated gaul to behave responsibly!!!!!
How dare you, SIR!
You turn right around and go out and max out your 12 credit cards, do you hear ME!!!!!!
Vital Signs….
http://www.businessweek.com/investor/content/oct2007/pi20071018_765303.htm?chan=search
The cockroach infestation is spreading into the corporate cash management arena
MetroPCS Sues Merrill Over Risky Investment
Investors were less than impressed when Merrill Lynch & Co. said its holdings of mortgage securities will take a $4.5 billion bite out of third-quarter earnings. Now one of the Wall Street firm’s big corporate clients, which also lost money on such investments, is up in arms.
…
Moneygram, a Minneapolis money-transfer company, on Wednesday disclosed that it had “unrealized losses” of $230 million in the third quarter on a portfolio of CDOs that totaled $620 million as of June 30.
http://online.wsj.com/article/SB119275660210964338.html?mod=hps_us_whats_news
but of course there is….
http://finance.yahoo.com/family-home/article/103732/The-Global-Millionaire-Boom
That report is 06 numbers. I wonder what they’ll be this year. Remember how many dotcom millionaires there were. Wonder how many real estate millionaires there were in 06 that are no more in 07.
I’ve read a couple times recently that your primary residence doesn’t count toward your net worth? Can anyone explain this?
Only your equity, not the home ‘value’
But I thought I could sign a mortgage for a million dollars and then count myself amongst “The Millionaires Club”. Awww fuuk, there goes another one of my fantasies. You guys are really a buzz kill.
NYCityBoy, don’t despair, walk down to Wall Street and kick some butt.
Have we really become so stupid as a nation that most people really don’t understand the difference? Cause if you think about it that portends way more then just financial debacle.
I recommend “Collapse” by UCLA Professor Jared Diamond…
He chronicles many civilizations that went bankrupt and out of business in this game of life, along with those that realized their mistakes and made changes, enabling them to survive and exist.
http://en.wikipedia.org/wiki/Collapse:_How_Societies_Choose_to_Fail_or_Succeed
Speaking of “the game of life”, did anyone else notice that both Monopoly and The Game of Life are doing away with paper money in favor of VISA-branded credit cards?
I doubt I’ll ever buy anything from Hasbro again.
priceless.
Hold on to the old Life and Monopoly board games folks. This could be the next bubble.
Just print your own money, just like the Fed does.
in Netherlands the primary residence is not counted at all for ‘net worth’, not even if it is fully paid. If they included it, the amount of millionaires would probably multiply from the current number.
One of the arguments for not including it would be that values are volatile/speculative lately (but of course government would never admit that, and the same goes for stock portfolios etc.).
Yeah, I ignore the whole thing. I have absolutely no idea what my house will sell for whenever I decide to sell it. Also, I’ve watched too many people get carried away with the supposed worth of their house. My BIL, for example, who lives in Satellite Beach, stopped saving because he believes his house has doubled in value.
Isn’t the whole idea in the Netherlands to keep the house from becoming a “liquid” asset?
That’s why some of the new homes are built on sliding posts-so if there’s too much “liquid”, the house doesn’t float away
You live there, so it’s liquidity is further constrained by an emotional factor.
I hate articles like that. Do houses count as assets? If so, it’s much easier for older European and US coastal families to reach the $1M mark through house values alone. What happens to the number of millionare households when house values revert to the mean?
Also, looking at the income gap between poor and rich also misses a huge variable, which is standard of living. The poor here in the US today have a better lifestyle than the middle class at the turn of the century. (Can anyone name someone actually living in shack without running water and power who isn’t that way by choice?) I’d much more willingly be “poor” any day of the week in the US or Europe vs China, Mexico, India, or the Middle East. Almost every poor person has access to clean water, TVs, transportation, shelter heat subsidies, and food in industralized nations. The rich only have bigger and more of the same. (Okay, the rich may or may not have lesiure time.)
“Almost every poor person has access to clean water, TVs, transportation, shelter heat subsidies, and food in industralized nations.”
At least at this moment, anyway.
USA has the highest standard of living for the poor on the globe.
Most economists will tell you that how you feel about your wealth is in direct correlation with your country cohorts, not what is happening from a global perspective. If you are struggling financially and people around you are not, it doesn’t really matter to you that people in Africa are starving to death. This is why keeping up with the Joneses is such a major issue.
Regarding people living in poverty by choice, I did some volunteer work in the Mississippi Delta. Many people were living in conditions not too different from some third world countries with very limited medical help and a horrible, horrible school system that only made sure to sustain the problem. Notwithstanding a woman that I met was mildly retarded and I’m sure probably more.
You know they count houses as an asset for a report like that. Everyone is taught that it’s “the biggest investment they’ll ever make” instead of “It’s the biggest money sink you’ll ever own”. I don’t even keep track of my house when I think of my net worth. I won’t even think of myself as a “millionaire” until I have 1 mil in cash in the bank. The term is not gonna really mean anything in another decade or so the way inflation is going.
“Also, looking at the income gap between poor and rich also misses a huge variable, which is standard of living.”
This is a big point that gets missed. I used to deliver pizzas and when going into poor areas I was amazed at the crap that I would see in some of these houses. Huge televsions, insanely expensive stereo systems. All while living in federally subsidized housing and crappy apartment complexes. Used to drive me nuts.
You’re not the only that it drives nuts. I have friend (whose getting a divorce, thank god) who lives on that end of the economic spectrum. Used to complain how the government wouldn’t supply insulin and medicine for her ex-husband’s diabetes (they spent most of their marriage on and off food stamps, etc). She also once complained about the high cost of fresh/frozen food to feed her children with some medical issues. However, they always had money for:
Big screen TVs
Beer
Cigarettes
Chips/Cheetos
Small boats
SUVs
Cell phones
Guns
They never went homeless, without power, water, or food. What am supposed to do about that kind of “poverty”? Why should I subside the medicine of a diabetic man whose alcohol habits would pretty easily pay for his needed supplies? I think people do need some sort of social safety net but to see conditioned dependence like that is aggravating and discouraging.
“I’m shocked!”
Shocked, I tell you… to find out that kind of thing occurs in the Socialist Paradise of Vermont!
How the place went from one of personal responsibility to one of government dependence in less than one generation is a story that needs to be told.
[Many thanks to Brooklyn's Bernie Sanders and Manhattan's Howard Dean and their many minions who invaded the place]
Vermont is far less dependent on the government than your hometown sf jack.
You must think I’m a fan of the government here.
You mean the one that had 3,000 employees making more than $100,000 a year in 2005?
(The ratio is 250 citizens to a worker that makes six figures working for the gubmint)
You mean that one?
The one that leads the nation in spending per citizen ($6 billion this year in total, the same as much, much larger Chicago), far ahead in unsolved murders (last I checked), can’t run a bus service to get anyone anywhere and absolutely cannot do anything about the homeless.
That city?
Our mayor is OK, but the Muppets could do a better job than our Supervisors.
And to clarify, I’m talking about individuals in Vermont:
“How the place went from one of personal responsibility to one of government dependence in less than one generation is a story that needs to be told.”
Several years ago, rosy numbers about household net worth always included imagined “house value”.
I took Business Week to task for this two years ago (see letter on bottom of first page):
http://www.robert.to/appearances/BW.pdf
It’s a dumb idea to count it, because you have to live *somewhere*, and even a house owned free and clear needs monthly upkeep and taxes.
I’ve never factored it in when seeing what shape I’m in for retirement, etc. I figure I need to live somewhere, so it’s a wash, at best.
And you never know what it’s worth until you
1. Sell it
2. Find a new place to live
3. See what’s left
Ten years ago, I was assigned a college dorm roommate who came from Hyde Park from single parent family. She brought with her a color tv set, a small fridge she owned, popcorn popper, and a boom box……all luxury items to me at the time. I later found out that they were all “hot” items. Then it all made sense.
I think there is a serious income gap in many first world countries and it is quickly getting larger. About 25 years ago the difference between median income and the average for top 5% wage earners in Netherlands was a bit over 5x; nowadays it is over 200 times, probably bigger than ever before while the difference between social security income and median wage stayed about the same (2-3x). I guess the numbers are similar for the US.
Part of the gap was temporarily bridged (for most of the middle class, not all) by home equity gains and all kinds of subsidies, but with the current spiraling out of control of both daily expenses and the every increasing income gap something has to give. Many more people will be ‘poor’ in the near future compared to 25 years ago. Maybe they will have some more (cheap) electronic toys to play with, but in a lot of other areas they will be worse off than their parents from one generation ago.
nhz
Loose monetary policy tends to severely increase income inequality. Cheap debt tends to disproportionately reward capital. That’s why bankers, private equity and hedge funds have done so well while the median household has gone nowhere. It really started with Greenspan in 1987 and we’ve had 20 years of that mess. We’re about to see a historic trend reversal.
yes, I really hope to see a historic trend reversal; this Greenspanian finance economy is tearing the fabric of society down. Not sure about rewarding capital; as long as you are not extremely rich it is very difficult to have your capital keep up with inflation. But taking on loads of debts has been excessively rewarded over the last 20 years, and that kind of wrong lessons will take a generation to get rid of
I hate articles like that. Do houses count as assets?
If you rent them out (i.e. if they generate an income stream) then yes. A primary residence is not a source of income, in spite of what HELOC peddlers say.
“Can anyone name someone actually living in shack without running water and power who isn’t that way by choice?”
I can name several “someones”. Come visit the Four Corners region on the Navajo rez–or any Native American rez. I’d say most don’t choose to live that way. Massive unemployment, drug and alcohol addiction, primitive housing, hunger . . . you know, 3rd world stuff.
White America rarely hears about this, although Oprah did do a drive-by segment about the Navajos a while back (boo-hoo, ain’t it sad) and moved onto more happy stuff like pimping the usual books and movies.
Anyway, the key word is “almost”. ALMOST every poor person has access . . . .
Come visit the Four Corners region on the Navajo rez–or any Native American rez.
I’d say the Navajo’s are behind the times.
Every reservation who can muster a political pay-off here in the Northeast is building a gambling casino.
The “get something for nothing” rake-off is so good, some white folks are turning up with long lost geneology certificates tying them to the tribes so they can get in on the action.
I have driven through the Navajo nation. It is far from any major urban area, and it is a truly desolate place.
Well…yeah, but they choose to live on a reservation and the reservation is its own sovereign state. Therefore, they get to supply their people with utilities, housing, food, employment, etc. You don’t get it both ways (ie. this is our land, but please do provide us with free amenities).
Sorta like the ever-sympathetic, late, great Sam Kinison: “You live in a @#*%ing DESERT… MOVE TO THE FOOD!”
Those shiftless Navajos need to get with the program: enlist a bunch of your best homies to help you put your couch, mattress and TV into the truck and move down to that cool apartment in Phoenix. Sign up for that great job at Home Depot after you’re all settled in. And if you ever get short of cash, pick up the cell and call the P’s for a quick hunnie. Troubles over.
And, hey, how about all those battered wives living in the “sovereign” U.S.A. who insanely “choose” to live in their cars with their kids? What ever are they THINKING??
I (white guy) lived on the “Rez” for several years. Yes, there are those that live in buildings with dirt floors, no plumbing, and no electricity, but they live there by choice. If the want to move to “town” (still on the Rez) they have that choice. There they can enjoy every modern amenity. Sattelite dishes sprout like mushrooms where there is electricity.
Some “choice”. I’m intimately familiar with this “better” alternative myself. They DO have every amenity in town: hot & cold running meth, booze, gangs, junk food, and row after row of depressing, cookie-cutter gov’t $hitboxes on crappy dirt lots in a crappy $hithole area of the rez. Still 3rd world.
But, hey–you can’t beat being able to watch “American Idol”. The American Dream. Like Carlin says, “you gotta be asleep to believe it”.
‘I hate articles like that. Do houses count as assets? If so, it’s much easier for older European and US coastal families to reach the $1M mark through house values alone. What happens to the number of millionare households when house values revert to the mean?’
You thought gold was fungible with some slight intricacies? Imagine people only having a house to offer for barter if the SHTF ?
good point. I know a couple of brothers who rag on me all the time because I don’t own real estate and they are landlords, getting money from their tenants. They say since their uncle made millions in RE, so should they. Well they have condos in Florida and claim they are immune from the Florida RE debacle. Let sleeping dogs lie!
I sent them a graph showing Real Estate only goes up about 1% above inflation over the long haul. So much for wealth creation. They ignored that. Personal Finance 101 shows differently, that real estate is NOT anywhere near the performer that stock investing is.
The term is meaningless using fiat currency.
good point; in the old days in the Netherlands we would joke that if you wanted to become a millionaire quickly, you should move to Belgium (just a short drive for some, and because of the currency some 20 times easier to get a nominal millionaire).
Italy used to be a good place to be a millionaire, on the cheap…
No wonder Japan is on the list.
“I love magic.” Harry Potter
And in fairy tales, magic has its place. In real world finance, with a negative savings rate an unstable job security, relying on real estate appreciation for moneys is insane.
We exported this crap. And as my Slytherin friends keep coming back too haunt Mr. Harry Potter, the bad credit decisions (overextend on ‘easy credit’) will show up again and again in the least likely places. This will take a couple of decades to work its way through the system.
“But some see a darker side to all this new wealth .” There is little new wealth. It is magic of the darkest sort. False wealth.
“I love magic.” Harry Potter
Even Harry couldn’t conjure gold out of thin air (unless he had the Sorceror’s/Philosopher’s stone).
And we all know who Voldemort is
This is weird.
FBI has raided the offices of David Copperfiled in Vegas and also at the MGM where he has a show.
Is he the mastermind behind all this?????
I don’t know if this is the same survey, but a survey done this summer touting those with over $1 million of assets, when you read the fine print of the survey, left out one minor point: LIABILITIES.
That survey didn’t count mortgages, car loans, credit card balances, nothing. Only assets (including houses). Leaving out liabilities automatically made the survey useless, but of course that wasn’t pointed out in the article.
From a spam advertising a new condo in Annapolis, MD. How can a free lease on a Mercedes with every purchase not qualify as mortgage fraud?
A special ribbon-cutting celebration will signal the official opening of the elegant new Park Place Annapolis complex on Friday, October 19 at 10:00 a.m.
Following the ribbon cutting, a series of activities will take place and continue through the weekend. Local Annapolis musicians will
perform and the new restaurants and shops of Park Place will host signature events.
Visitors can register to win the grand prize, “Experience Park Place” package, which includes a two-night stay in the Westin’s $1,700-a-night presidential suite, a $200 gift certificate to Morton’s, a spa package from Varuna Aveda Salon & DaySpa; plus additional drawings for other amazing prizes from Carpaccio, Fado, Saucy, The Papery and Starbucks.
Anyone who purchases a condominium during the Grand Opening weekend will receive a two-year lease on a new Mercedes Benz courtesy of Mercedes-Benz of Annapolis.
What’s “receive a two year lease” mean?
Sounds like you have to pay for it.
Then I guess it wouldn’t be “mortgage” fraud.
Do you really think that the Benz dealership isn’t “courteous?” Or is the blurb just saying that they will courteously demand payment?
I wonder who picks up the insurance tab, on a Benz?
I wouldn’t get a Benz - the crappiest cars ever, a shame really. A Lexus or Acura will do it.
Oil at 90, gold up, futures down, and it was 20 years ago today:
http://www.stock-market-crash.net/1987.htm
My memory is a little foggy but I think that when the dotcom bust happened the Dow started dropping but the Nasdaq kept on going up. Of course it is still over 3000 points under its all time high!
Dow is down 125.
Nice start of the trading day.
Got popcorn?
Neil
Stocks down, but PPT is active in the banking index.
I call a positive close at the end of trading today. The conditions are perfect for PPT intervention.
-190. Market curbs are in.
Today is the perfect day to test the PPT conspiracy theory. If this market comes back today when there is absolutely no good economic news, there must be something there.
I think the PPT musta took a 3-day. Oooopps!
“Oil at 90, gold up, futures down, and it was 20 years ago today: ”
Bookmarked that link. Will shortly have a new dell CPU with plenty of punch to store zillions of bytes/files/data. Informational data transfer rates too slow on my old Dell and I need to do some serious hi-speed blogging, posting,downloading, e-maiing, photo work at hi speed.
Got a good deal on E-bay for an Expandable Inspiron 531 AMC +4400 160 HD 1 gb mem, ect at 50% off retail. Am being very cheap and will pay as cheap as possible for consumerables knowing that retailers are hurting and will undercut till the christmas shopping season gets underway late november.
http://www.businessweek.com/bwdaily/dnflash/content/oct2007/db20071017_582905.htm?chan=investing_investing+index+page_top+stories
More from Hank Fishkind:
Only place for region’s housing to go is up
“Southwest Florida has reached the bottom of its housing slump, but a significant turnaround may take some time.”
Most of that article was much of the same old drivel. As to this quote:
“We’re at the bottom of the housing cycle, but it’s going to be long and flat, I’m afraid,” he said.”
No such thing as “long and flat” (unless it is one of txchick’s trouts). There is no such thing as a business or economic cycle that remains flat for a long time. Things can remain flat for a short time, but then they either improve or deteriorate. I’m going with Door #2. But thanks for playing, Hank.
U Haul index for 26′ truck, pick-up on November 14.
Raleigh to Sarasota: $294
Sarasota to Raleigh: $1908
Last one out of Florida please turn off the lights.
Why does the media never actually do any “reporting”, like this?
U Haul figures nearly 7 times as many people are leaving Florida, vs coming in, via 2 major cities.
And they aren’t a philanthropic foundation either…
Every price they quote is cold and calculated, to make them cash.
That’s worse than the rates from Michigan to Texas in the worst of auto industry contraction. Pretty soon, they’ll be paying people to haul them back to Florida. Ouch.
Since you live down there I think it’s incumbent upon you to grab your own trout and go whack these guys up side the head. These shills are really getting on my nerves.
Mortgage in a bottle
http://www.stockmania.com/index.php?showimage=72
That’s good. S.I.V. is spreading to all corners of the earth.
A hundred billion castaway (mortgages) looking for a home
I’ll send an SOS to the SIV I’ll send an SOS
I hope that some GF gets my, I hope that some GF gets my
Message in a bottle…message in a bottle
” hope that some GF gets my
Message in a bottle…message in a bottle”
‘I send a S.O.S to the world’ that something nasty(international monetary system breakdown)will rise up from a dark Scottish Loch. That ‘little black spot on the sun today’ becomes a mega Mortgage/credit meltdown tomorrow.
From Police ‘Syncronicity Album’ and ‘Every breath you take’ best singles compilation CD.
This will amuse New Yorkers without special deals.
http://www.newsday.com/news/local/wire/newyork/ny-bc-ny–biancajagger1018oct18,0,3882971.story
An Appeals Court reversed a lower court decision and held that Bianca Jagger could not simultaneously keep a rent regulated apartment claiming it as her primary residence and be on the country on a tourist visa that requires a temporary visit. By a 3-2 vote!
I have a co-worker (trying to sell (and leave (hahaha))) who simultaneously cannot believe that his house his “tripled in value” while his “realtor is being lazy and not showing it.”
Good for you, man. Good for you.
Muggy, where is this “tripling” in value and were does this dope of a co-worker plan to flee to?
Yes, details, please!
Seminole (City, not County) Florida. And he’s moving to (I mean, wants to move to)… don’t make me say it… you know I’m gonna…
North Carolina.
Wait! Wait… it gets worse…
He’s tired of the “traffic” and wants to “live in the mountains.”
By the way, I love the term “God’s Country.” I’d never heard that until I moved to Florida. I’ve finally figured out what it means: wherever the next boomer dream is paving over natural beauty.
God’s Country.
Sheesh……..by the time I get to the Carolinas, the place is going to be ruined.
not if everyone has to sell before they can move there
Blano,
The time to move to NC was in 99 - 02, just after the push into the Northwest. It was my dream location too (Chapel Hill).
I also had a few friends who fled the US completely and moved to Prauge back in the 90s.
Gwynster, so where is the place to go now?
I fully plan to profit from the re-migration from the country back to population centers. The trend has already started but the sheeple continue the out migration from small cities to “the country” not knowing they’ll end up right back where they came from.
Good strategy. The locals won’t like them - and they’ll quickly find not everyone is skilled and talented enough to get a high paying stay-at-home job (a key tenant of most all moving to the country plans). So, back to the cities they will go.
Well I think one thing to consider is how many people left the bubble areas for a cheaper cost of living that will be returning once “cheaper” is back home?
Carrie….. I think you can attest to the influx of equity bandits into Syracuse area.(I believe thats where youre at)…. I can tell you this….. upstate NY (from albany suburbs north to Quebec) and all the way east to NH/ME border has been swarmed by equity bandit clowns from elsewhere. The same thing happened in the 80’s but no where near to this extent. As I’ve mentioned here before, I’d estimate that nearly half end up leaving and going back to where ever they came from.
Nosy Nellie here is curious as to how you will profit from that re-migration. I hope you’re right, as I intend to go the other way (head for the country somewhere).
Already in the Phoenix Arizona metro area the fringe areas of Maricopa County such as Maricopa and Queen Creek have ghost subdivisions. Prices are more resiliant in areas such as Tempe. We’ll have to see what the light rail does to Phoenix. I’m interested in finding a spot in Tempe close to the light rail (in a few years). I’m a baseball fan and it would be great to get downtown from lightrail for a dinner at Kincaid’s followed by a game. That is, when I spend more time in Phoenix.
Try St Louis sometime……..light rail line all the way out to Scott Air Force Base on the Illinois side, goes straight downtown, with a station right outside the new Busch Stadium (and the Dome where the Rams play in football season). Several great restaurants within a block or so of the ballpark.
Like the locusts, eat everything, crap everywhere and move on. At least in the Grapes of Wrath they were leaving family farms and moving because the Depression and drought did them in.
“At least in the Grapes of Wrath they were leaving family farms …”
Actually, the Joads were poor sharecroppers - they didn’t own the land they farmed.
NEW YORK (Reuters) - Bear Stearns Cos … is being investigated by Massachusetts securities regulators….
Investigators are also seeking to determine if some troubled securities [MBS?] traded by the bank were offloaded into the hedge funds and whether they were priced properly….
http://www.reuters.com/article/ousiv/idUSN192136920071019
Hallelujiah! Catch it before they pay the bonuses!
That WSJ story last week about it just hit me between the eyes.
Wanna bet the real problem is that Massachusetts government pension funds are stuck with these dogs?
They’ve been bragging lately about how brilliantly they’ve managed their portfolios…….and how their execs (former legislators or their relatives) deserve much more compensation as a result of the performance.
SOP for the I-banks. Dump the losses into toxic waste dumps managed by them where the bag… um I mean shareholders take the loss not the bank. They tried to do that with the Everquest IPO but the CDO losses caught up with them before they could dump it on to the public. Pension funds are the worst at this since the managment of most small ones is amateurish and politicized.
The stories I could tell! I spent 9 months with a pension fund “consultant” this year.
txc, don’t be a total tease - show a little bit
RE: Wanna bet the real problem is that Massachusetts government pension funds are stuck with these dogs?
Excellent point Jag…What’s the annual state pension returns?
Like 16% or so?
Right up there with the Havard endowment monies.
Bad news for those who have been trying to sell in the Washington DC metro area. The Washington Times’ weekly “Charting the Markets” is out with these numbers for resales for September year-on-year:
Metrowide (DC/MD/VA):
2003 - 9,281
2004 - 10,611
2005 - 9,287
2006 - 6,780
2007 - 4,423
Maryland suburbs dipped from a peak of 4,788 to 1,960.
Virginia suburbs dipped from a peak of 5,016 to 1,975.
The crunch is on for sellers.
Housing sales volume in Northern Virginia:
21 billion, Year to date (September 2005)
14 billion, Year to date (September 2006)
10.4 billin, Year to date (September 2007)
50% drop in sales from just 2 years ago.
Here’s the link to nvar.com. It seems the data is mysteriously missing today:
http://www.nvar.com/market/mktsum.lasso
Nothing like a 50% haircut for those in the RE business. I guess Cheesecake Factory is out and McDonald’s breakfast is in.
McDonald’s breakfast is too good for them - they need a White Hen muffin that’s been sitting in the warmer for 4 hours.
What?!?! Even Pravda editors would blush at the shameless spin!
“The outlook for 2008 is positive,” said Christine M. Todd, NVAR CEO, who spoke at a Sterling of Oakton event recently, an active adult community. “The worst will be over by the end of the year and 2009 will be even better. …In two years …we will be back in a seller’s market again.” In the meantime, a buyers market prevails with the metro region excelling beyond all national average indicators.
Don’t worry about that iceberg. This ship is unsinkable!
Here’s a link to the above-mentioned charts:
Charting the Markets 19Oct2007
That is excellent data. Far better than the NAR bs. Does anyone know if this data can be had for other areas?
Every month I track 10 years of sales data for just Northern Virginia counties. Here’s September’s.
“We remain cautious about the market for lawn and garden equipment next spring, especially since it remains to be seen where consumer spending and retail confidence will shake out,” John Shiely, Briggs chairman, president and CEO said in the conference call.
Briggs & Stratton Corp. reduced its full-year sales outlook Thursday amid worries about consumer spending and the weather.
Employment at Briggs factories that make generators and pressure washers has been reduced from about 1,200 people to fewer than 500 in recent months.
http://www.jsonline.com/story/index.aspx?id=676473
“reduced its full-year sales outlook Thursday amid worries about consumer spending and the weather.”
And the weather. Priceless.
No kidding, houses might not sell next spring - but the grass will still grow. Why does every single corporate announcement nowadays have to include some attempt at plunge mitigation?
Well, with food prices spiraling out of control I would say that garden equipment sales should prosper. What’s that you say? Eveyone only has a 10′ back yard with their McMansion and have no room for a garden?
I guess you’re just screwed then….
People have forgotten how to garden. It’s not that simple. My older friend who’s a gardener was telling me some stuff that seems pretty simple, mostly about how some veggies etc. will grow in certain climates but don’t taste good, for ex. things that need hot days and cool nights (melons), stuff like that. She plants by the mjoon cycles, was telling me all kinds of things that seemed important but not common knowledge. Would be pretty scary trying to do all this with no real basis and knowing your food supply depended on it.
That is a great point. Just like many other things we are forgetting how to do.
“People have forgotten how to garden. It’s not that simple.”
I do gardening in the spring and early summer, have about 200 st feet to work with. Simple easy to grow stufflike tomatoes, cucumbers,eggplant,peppers.ect. Stil lot of time,effort,phyical work,prep required, about $150-$200 invested in fertilizers,plants, garden stakes,ect. That is cheap as i cobble together the stakes myself out of discarded cheap scrap wood.
Am not a gardening expert so i keep it simple. Nor is it my primary hobby. I do it to save money on certain grocery veggies. Need to do more leafy green veggies next year which require a bit more prep and tending than Tomatoes.
We are learning how to grow things and our menace is gophers…
Caddyshack becomes us.
Gophers? You need a pellet gun.
Roidy
Gophers can’t tunnel through the concrete floor of our greenhouse…
Live and let live
Gophers a problem in certain localized regions where I live. Traps are a pain, so one of my coworkers made an attachment that he could hook (a high temp) hose to his lawnmower exhaust and gas them.
Gardening is only for those who know what they’re doing. The only thing that can grow OK with pretty much no care is potatoes, but you need a big yard for it to be feasible.
My grandmother is a hardcore gardener, and, no kidding - it’s a full-time job.
Plus here in the US gardening is not cheap.
Chance the Gardener: As long as the roots are not severed, all is well. And all will be well in the garden.
And with zero lot lines those McMansions cast too much shadow to grow much. BOHICA
Werewolves of inflation:
http://www.atimes.com/atimes/Global_Economy/IJ20Dj03.html
Greenspan, the ultimate loose cannon.
http://blogs.wsj.com/economics/2007/10/19/greenspan-warns-of-risks-with-super-siv-fund/
“From the WSJ: Former Federal Reserve Chairman Alan Greenspan said the “Super SIV” fund could have serious repercussions, according to an interview with the Emerging Market newspaper and posted on its Web site. In the article, Greenspan said the ‘Super SIV’ — the $75 billion Master Liquidity Enhancement Conduit designed to take on the assets of troubled investments — runs the risk of further undermining already brittle confidence in besieged credit markets.”
Mr. Greenspan now works for PIMCO. Is he reflecting his own opinions or those of his employer?
add his position at Deutsche Bank to the equation …
at least we can be sure he favors more bailouts of WallStreet & friends (e.g. more monetary inflation).
we just fired up the presses…again
Justice Dept. going after MLS and fixed commissions as being anti-competitive?
http://www.heraldtribune.com/article/20071018/REALESTATE/71018021
Something strange going on here. Must not be enough campaign contributions coming in from NAR.
Interesting, Bill. Not that I’m any fan of the MLS, but RE commissions are a drop in the bucket compared to the stuff that’s happening on Wall Street. Now, when DOJ puts up a website for the hedgies and the likes of Mozillo, I’ll be cheering.
And, true, looks to me like the NAR is going to bear the brunt of the blame for the bubble.
Excellent! I’m all for that. Get rid of these parasites once and for all.
Caterpillars earnings are dismal. One of the thoughts on the Street was that killing the dollar would improve exports. It did improve exports, but after adjusting for currency translations and cost of materials. Lower guidance.
“Despite weakness in U.S. markets, our sales and revenues increased 9 percent,” Owens said in a statement. “We continue to see remarkable growth outside of the United States, with particular strength in key industries like mining, oil and gas, electric power and marine engines.”
So much for the idea of buying US multi nationals. In this international sales market anything tied to the dollar is toast.
Thanks for noting this, Hoz. I posted a paper a couple of days ago by Marvin Feldstein. He posited that the falling dollar would improve exports, which would in turn increase US jobs and avoid recession. I guess that he left out some important facts that you discerned. Once again I learn more from the HBB than a famous economist.
As mentioned by Greg Palast (I think Paul Krugman has a similar quote):
“Currency Exchange Rate Economics Lesson Number One: You can’t change the value of goods by changing the value of the currency on the price tag. The price inflates to compensate for the currency change. As my comrade the economist Art Laffer reminded me: “If cheap currency makes your products more competitive, all automobiles would be made in Russia.” Driven a Lada lately?”
So much for the “Global Market” picking up the slack for the fading ever US market.
CAT has the opposite problem of the Homebuilders.
All those US firms with fleets of heavy equipment are going to have to liquidate their fleets. No one is building anything in the US so those machines get shipped off to the rest of the world. California has shot itself in the foot with the new diesel emission restrictions.
Why buy a new machine from CAT when you can pick up a used one for nothing. Every year the cost of replacement parts falls because the dollar is collapsing. Win-win for foreign construction and mining firms. Lose-lose for the US.
Thanks, AG.
Another home under construction fire/explosion…
http://www.nj.com/news/index.ssf/2007/10/explosion_levels_irvington_hou.html
For your amusement
http://www.reportonbusiness.com/servlet/story/RTGAM.20071018.weustace1018/BNStory/Business/home
LOL……..there you go chick…..Trout Trading Company!!!
Got Green Gold?
The jatropha bush seems an unlikely prize in the hunt for alternative energy, being an ugly, fast-growing and poisonous weed. Hitherto, its use to humanity has principally been as a remedy for constipation. Very soon, however, it may be powering your car.
Almost overnight, the unloved Jatropha curcushas become an agricultural and economic celebrity, with the discovery that it may be the ideal biofuel crop, an alternative to fossil fuels for a world dangerously dependent on oil supplies and deeply alarmed by the effects of global warming.
http://www.timesonline.co.uk/tol/news/world/article2155351.ece
Intel Corporation
Santa Clara, CA
Intel Corp., the world’s No. 1 chipmaker, reported a 43% increase in third-quarter profit Tuesday, benefiting from a robust personal-computer market. Intel also set in motion more staff cuts, saying it would shed 2,000 jobs in the fourth quarter, reducing the company’s head count to about 86,000. That’s down about 9% from where it stood in the end of 2006. The Chief Executive cited “a combination of great products, strong and growing worldwide demand, and operational efficiency” as the key factors for the growth seen in the quarter. The company said its performance was driven by growth in chips for laptop and other mobile devices, along with the corporate market.
Approximate Affected Workforce: over 1000
MarketWatch - October 17, 2007
Novell Inc.
Waltham, MA
Provo, UT
Software developer Novell is laying off 200 people in Provo and shipping many of the jobs to India as part of its reorganization aimed at cutting costs, a spokesman said. Novell still employs about 1,200 people in Provo, where the company was founded in 1983. It moved its headquarters to Waltham, Mass., in 2004. Novell, which develops and markets operating systems based on Linux, as well as security and management software, announced the restructuring effort last year. India has a large number of software engineers, and the U.S. software industry has been moving some operations there because of lower wages.
Approximate Affected Workforce: 101-500
The Salt Lake Tribune - October 17, 2007
SCO Group Inc.
Linden, UT
The Lindon-based SCO Group Inc. says it is planning to lay off 16 of its 123 employees and has asked a federal bankruptcy court to keep their identities secret because it fears they could be harassed. SCO also is facing an effort to push ahead with a trial in federal court in Utah that could determine that SCO owes Novell as much as $35 million in licensing fees because of a ruling in a dispute over ownership of the Unix software program. SCO filed for bankruptcy on Sept. 14, the result of a long court battle with Novell and IBM over ownership and use of the Unix computer operating system program. SCO claimed it, and not Novell, owned the copyright to Unix and that IBM had used parts of that code in developing the Linux operating system, whose code is open to the public and can be used or altered by individuals or companies for their own uses.
Approximate Affected Workforce: 1-50
The Salt Lake Tribune - October 15, 2007
Skywire Software, LLC
Frisco, TX
Moncton, NB
A leading software company has recently cut its workforce across North America, including layoffs at its recently acquired Moncton location. Skywire Software, which specializes in developing software in fields such as insurance, financial services and health care, recently reviewed its organization and identified what a spokeswoman called “overlapping functions”. She said the employees they let go worked in general administrative areas such as marketing and human resources. As many as 40 people have been laid off at the Moncton office, which had just under 100 employees when Skywire took it over in August. Skywire Software is based in Texas and bought the homegrown Moncton company Whitehill Technologies in August. The Moncton office is part of a North American Skywire network that has offices in Texas, Georgia, New Hampshire, Virginia, California and Ontario, and has a total of 650 employees.
Approximate Affected Workforce: 1-50
The Times & Transcript - October 16, 2007
Websense, Inc.
San Diego, CA
Security software vendor Websense slashed its third-quarter revenue outlook and announced plans to save $10m in the fourth quarter and $60m in 2008, mostly from job cuts in the wake of its acquisition of rival web-filtering vendor SurfControl. The San Diego, California-based company blames lower billings for lowering its third-quarter revenue estimates to $50.4m, from earlier guidance of $51 to $51.5m. Billings for the quarter are now pegged at $52.2m, down from the guided range of $56m to $59m. Websense had 728 employees at the end of last year, and SurfControl reached the end of June with 611. The company declined to go into exact details as to how many jobs would go or when, not least because it is dealing with the more complex labor laws in the UK and Germany.
Approximate Affected Workforce: N/A
Datamonitor NewsWire - October 12, 2007
Just some of the layoffs in the past week, but these are/were high tech. -only reason posted.
My elderly in-laws have been puzzled by the “business is great but everyone is losing their job” economy we have been living in these past 20 years. They just can’t fathom it.
layoff news from the Netherlands: a US medical equipment company closes down its Dutch factory (which was very profitable …) because the operations will be relocated to Mexico and … the US. interesting times
Who was it?
SCO! I laughed so hard my GF yelled at me for hurting her ears.
The SCO drama on Slashdot was where I learned the term “pump ‘n’ dump.” Good times.
FB = F’in Bagholder? I’ve been reading this blog for months and still haven’t figured it out. I did buy a house in 2006, though, so I’m apparently not very clever.
F@ucked Borrower
Effed borrower
effed buyer
effed bond holder
effed banker
a whole bunch of effed
Your clever factor is going to exponentially increase if you continue to read this blog.
If anyone followed my suggestion last week that the risk/reward ratio was favorable to short financials and did so, I am closing half my short positions today.
I took PMCS overnight and made a buck/share on it. Not bad on an $8 stock. This market will really give way when these nasdaq ethusiasts give up the ghost too.
SKF was a 10% move, and quite briskly I might add
Yeah, I made money on it too. Thanks, hbb.
(Plus, the IB’s tanking has that sweet, sweet taste of Schadenfreude. Can’t even put a price on that.)
You go Voz and Tx, I am closing half because 1) a very nice profit and 2) do not know when I will be back.
Yesterday, I took my weekly drive into the big bad city (Rockland, ME, pop. 7609), and noticed a sign for a HOME AUCTION!!!, the first one I have ever seen in our little corner of paradise, which I guess means that the subprime mess has finally reached us. On the way back from the Farmers’ Market, I turned off at the sign, just to check it out. Drove about 5 miles down the road until I got to a big industrial site with a BLASTING AREA warning that looked suspiciously like an annex to the Dragon Cement Plant, then turned around. So, I don’t know exactly what was being auctioned. ( There was no realtor’s sign attached, so I couldn’t find it on the Net.)
There is one rental for sale that I’m watching in my town, a dilapidated duplex fully equipped with decrepit single-wide, which is sited conspicuously right on the main drag, where every other house is gorgeous, picturesque, or, at the very least, well-kept. Wow, is that place ever an incredible eyesore with old refrigerators and car carcasses on the lawn, unemployed adults smoking all day on the stoop, ragged children like you’d see in the worst hollows of Appalachia, and a pathetic skinny dog tied to a tree barking insanely. (Ever read “The Beans of Egypt, Maine”? Like that.) One day, we drove by and the kids were playing naked and totally unsupervised in a deep-enough-to-drown-in above-ground swimming pool (which is now sitting there, collapsed, on the front lawn) and it was all I could do to keep my husband from calling Child Services (while he kept me from calling the Humane Society, about the dog). This attractive property is currently listed at $149K (ha!) but if/when the price gets low enough, I am going to screw up my courage and go to the Town Meeting (People From Away: Enter at your own risk!) and propose that the town buy it, bulldoze it, and turn it into a little park.
You DO need to contact the Humane Society. People who tie dogs up and neglect them are scum. The dog doesn’t have anyone else to speak up for it, does it? How many years can this continue?
I totally agree with you, but as it turns out there is no law against tying up dogs in the yard here in Maine and leaving them there 24/7. This is something animal welfare groups have been agitating for nation-wide, but here, right now, it is still legal.
But is not feeding them legal?
The kids from this home, playing in their front yard, will probably grow up a lot healthier than the kids in the other home, sitting in a refrigerated living room in front of a plasma screen shooting people on their XBox or PS3s.
Agree, reuven.
I certainly get the drift of the post, but think too many people want to play “parent police”. One person’s child abuse is another person’s parenting style.
Just because we don’t agree with it, doesn’t mean it’s abuse. I’m not trying to be mean, but have seen the trouble this (false reporting) has caused very nice families (used to be a teacher and saw lots of stuff there).
by all means call someone if you see either child or animal abuse.
I drove by that blasting area this summer while on my annual visit to mom (Waldoboro)and sis (N. Pond). I’m seriously considering moving there in a few years when the water dries up here in Cali. Lots of nice property. And I’m with the rest of these folks. Call child services and humane society. No one deserves to live a life of neglect.
Heck, I am down the road in Friendship and probably have met your mom. Waldoboro is a very small town. Give me a holler the next time you are up here. The problem with calling Child Services or the Humane Society in these very small towns is that everybody knows everybody else and you can quickly and easily insult the brother of the person who you’re relying on for…..whatever. We People From Away try to just bring hard currency here while not rocking any boats.
Hey bicoastal~
What’s the Belfast lookin’ like these days after BofA bought up MBNA?
They ship all those jobs back to NC?
Um, I’ve never actually been to Belfast. We mostly stay in our little comfort zone of Friendship. Waldoboro, Rockland, and Damariscotta. When I really want to get wild and crazy, I drive up to Camden!
Everybody have a great weekend!
R&R time.
Enjoy, Hoz!
I have a BofA credit card. I recently received one of those “change in agreement” notifications. Cash advance, balance transfer and convenience check fees going from 4% with max $90 (so topping out at $2000-ish) down to only 3%. Which they call an increase… Because they are removing the max cap on the fee.
Also upping the max default rate for when you are late on a payment by a day from 24% to 34%.
Are they TRYING to cause writeoffs by pushing people into bankruptcy?
“have a BofA credit card. I recently received one of those “change in agreement” notifications. Cash advance, balance transfer and convenience check fees going from 4% with max $90 (so topping out at $2000-ish) down to only 3%. Which they call an increase……
Also upping the max default rate for when you are late on a payment by a day from 24% to 34%.”
I have a B of A which has a 0% rate for 1 yr om PURCHASES AND BALANCE TRANSFERS & CONV CHECKS. They do have that 3% fee on using the conv checks.
Also have chase which has exact terms as BoF A. Ditto for WAMU. It ’s a race by the major CC’s to turn consumers into debt prisoners for life. One mistake in missed pyments and yes they wlll jump rates to max 34%
I have never missed a pyment in 5 years but if they want to play games i simply transfer that hi-rate into another 0% card or my WAMU HELOC which is 7.2% with a very low balance and huge equity cushion.
Last-ditch nuclear option is I BK if my credit card balances careen out of control, which won’t happen for at least 2 more years even if i make 10 trips around the world and max out my 10 CC’s with average 10% balances. Another last option is to roll everthing into a 5-6% fixed Home equity loan.
“Are they TRYING to cause writeoffs by pushing people into bankruptcy?”
————
The whole financial system has been like a Kafka novel for some time now. Each acting rationally in accordance with their own self-interest, but producing a whole that is utterly absurd.
yes, you push to the brink…
if people burn down in ernest, or capitulate to noose, you have gone too far.
From Today’s Wall Street Journal:
Looks like Buffet just gave the homebuilders a much-needed slap in the face.
Dennis and Sunshine have dusted off the old calculator and crunched some numbers:
http://realtytimes.com/rtmcrcond/California~San_Diego~dennissunshinesmith
“NEWS FLASH *** ***
Sept. re-sale home sales in San Diego County are down 57% from August 2007 and 110% from Sept. 2006. Call me for a full explaination and to see how buyers can benefit from this.”
How can sales be down 110 percent? Negative sales? I would assume the being down 100% would mean no sales what so ever.
Yeah, and how can they call it a “buyers market”, even if sales were down ‘only’ 100% there wouldn’t be any buyers, would there?
Funny thing it’s not just a decimal point error, sales are actually down more than 5.7% and 11%. This must be the calculator they use to qualify tomato pickers for $600k houses with.
I guess it depends on the state, but a Real Estate agent has a legal obligation to represent a buyer or a seller in a financial transaction. If they can’t do simple math, and then examine the results for reasonableness afterwards, it’s clear they’re not qualified.
Which one is “Sunshine?”
I like the way the column calls them “Real Estate Experts”. If they were telling people to buy during the bubble, they’re not experts! Even I, a lowly mathematician, was telling friends to keep renting.
–
California Sinking!
http://www.loanperformance.com/pressreleases/pr101507.aspx
And September and October are going to be lot worse
Jas
Hey Olympiagal
I graduated from Timberline HS and lived in Oly for about 15 years. I was one of those white skinned people you talk about. I would like to get the local scoop. E-mail me at kbarrett “at” USIC.com
Thanks
PS - Is it raining?
Loss control at USG?
http://www.libn.com/article.htm?articleID=40311
“in the first half of 2007; one out of every 180 Suffolk homes entered foreclosure”
“Nassau was hardly off the hook – as one in every 251 homes entered foreclosure during those months.And it’s getting worse. The number of foreclosures climbed in the third quarter, with a 14.4 percent increase in Suffolk and a 27.4 percent increase in Nassau when compared to the second-quarter.”
““It’s likely that the foreclosure problem will be worse on Long Island than elsewhere,” she said.”
Just an update on my 40% lowball offer on the big, old, unmaintained money pit for sale in my neighborhood, if anyone is interested. The lawyer sent me a letter declining to even consider the offer. What was funny was his last sentence: “Hopefully, we will find a buyer who recognizes the value of this old beautiful home and the capitalized value of the income from its rental.” The rental of the garage apartment is actually illegal. Hopefully, they will find their chump.
save that letter. When they come back to you a year later you can use it for more bargaining power.
Don’t use it now? It’s very tempting.
Mickey,
A cold winter is appraoching. Be patient. Let’s see if they get their asking, or if you find a better place for the money. I’d bet on #2.
It isn’t the lawyers job to decide on the sale, only to insult you with the answer.
Thanks for the vote of confidence. I will wait. I’m so tempted to turn them into the zoning board - that’s what an insult will get them.
While packing and awaiting my ride, I was stunned that this was said, ““When the public is unsure about the central bank’s objectives, even greater benefits may accompany achieving a stable inflation rate, as doing so may help anchor the public’s inflation expectations, In a world of uncertainty, informing the public about the central bank’s objectives, plans, and outlook can affect behavior and macroeconomic outcomes.”
Chairman of the Federal Reserve Mr. Ben Bernanke
Oct 19, 2007
Opacity to the extreme.
As long as the public can predict how much we will steal/devalue their money everything is good…. these bankers think it is their right to create money at a “stable” rate… down with the Fed! Ron Paul FTW!
How much of the “public” actually gives a hoot and/or thinks about the central bank’s “objectives”?? I’m thinking not many.
Unless the “public” is his Wall Street buddies.
3%
Serious confirmation that California as a whole is already in recession from Merrill Lynch today:
—————-
California in a recessionary state
The lagged state data show a decisive pickup in jobless claims in California, which seems to be already in a recessionary state: If this key 13% chunk of GDP, and
historically a leading indicator for the national economy as a whole, is not in recession, then someone would have to explain how it is that state government sales tax receipts are down 1.6% so far this year from where they were in 2006 (in September, retail sales tax receipts were down a whopping 7.5% y/y).
Here’s some local job news:
http://tinyurl.com/3dpdbg
Lansner: O.C.’s midsection hit hard by 3rd quarter home slide
http://tinyurl.com/2hbtro
http://www.latimes.com/news/politics/la-na-donors19oct19,0,4231217.story?coll=la-home-center
The candidate’s unparalleled fundraising success relies largely on the least-affluent residents of New York’s Chinatown — some of whom can’t be tracked down.
Dishwashers, waiters and others whose jobs and dilapidated home addresses seem to make them unpromising targets for political fundraisers are pouring $1,000 and $2,000 contributions into Clinton’s campaign treasury. In April, a single fundraiser in an area long known for its gritty urban poverty yielded a whopping $380,000. When Sen. John F. Kerry (D-Mass.) ran for president in 2004, he received $24,000 from Chinatown.
The Senator from MetLife, Citi, and JP Morgan Chase …
“We sold our FL house in November 2005. It had been on the market for a while with one contract that fell through and then ultimately a bidding war at the end to over the asking price. For the entire year or maybe 15 months before we signed the closing papers, I was absolutely positive I was in a race against time to make our “paper profit” a reality, before the window closed. I used to go walking every morning with a neighbor, and we would debate whether there was an end in sight. My position was that there was, and it was coming soon. Her position was that there was not, since people kept streaming into the area from South Florida (having made huge profits on their homes there) and other locations as well. I was on fire to get the deal done and leave.
I am no financial guru, not by any stretch of the imagination. What had me convinced that there was a bubble, we were floating around in it, and it was about to pop, was just common sense. Florida is a service economy. There just are not a lot of high paying jobs there. It’s always been that way. Retirees found it attractive partly, maybe largely, because of the affordable housing costs. But even retirees generally tend to have fixed incomes. I just knew that there was not going to be an endless supply of people who could afford $200,000++ mortgages in Central Florida, even with great interest rates. I knew it was not possible.
Our house sold for $325,000, and the lady who bought it financed 100% of the loan. She was also a real estate broker. I’m sure she is happy with the home itself, because it really is a great house. But she can’t be thrilled with the fact that she is upside down in a house. And she was IN the business.
It was like everybody was taking a drug, and the effect was that the drug lulled them into believing, despite all common sense and just the obvious “nothing can go up forever” law of nature, that there really was no end in sight and the gravy train was on an infinite track headed straight uphill.
It still floors me, a few years later. We would have been okay if we’d stayed in Florida, I guess, but I would have been so full of regret for not following my instinct and seizing the opportunity to get out while the getting was good. ”
http://ths.gardenweb.com/forums/load/realestate/msg1013381423367.html?7
So apparently some people DID make out. Kind of like the few who cashed out at the top of the dot-com boom, eh? Pretty ironic that the house (and alligator mortgage) ended up belonging to a realtor, too!
RE: She was also a real estate broker. I’m sure she is happy with the home itself, because it really is a great house. But she can’t be thrilled with the fact that she is upside down in a house. And she was IN the business.
Just goes to shows ya the general overall level of knoweledge and competency inherant in the RE sales biz. And just think-if this ditz couldn’t even operate in her own self best interest, how many unknowledgable chucks has she flushed down the chute.
Probably markets herself as a buyers broker.
Neil, my wife and I are watching the market tank, and we have just gone through our second batch of popcorn. It is not microwave popcorn BTW, but we just bought the kernels (in the dried beans section at the supermarket). It popped up great!!
DP
1. I keep hearing ads on the radio for rent-to-own storage barns. How lame is that?
2. There seem to be a lot more decent cars for sale in the $2000 range than last time I went car shopping. (Maybe it’s because I didn’t know about Craigslist in February 2005?) Before, most of the cars in that range were 15-20 years old. Now I see plenty that are 7-10 years old. Are people getting more desperate to sell their cars?
3. Around May, there was a radio ad campaign for special pre-construction pricing on a new development. Well, they just started another ad campaign, which makes it sounds like “You better buy now, lots are selling fast!” Yeah, right.
‘Around May, there was a radio ad campaign for special pre-construction pricing on a new development. Well, they just started another ad campaign, which makes it sounds like “You better buy now, lots are selling fast!” Yeah, right.’
If bargains are appearing now, imagine how many desperate sellers will be coming out of the woodwork in the upcoming years. The days of having to feed the squirrels are being met with a reversal of fortune.
The MSM is reporting inflation for - get this - food and everyday necessities! I’m glad to see a report on how the economy is hurting regular people who aren’t asinine FBs.
Living Paycheck to Paycheck Gets Harder
And this is why they live pay check to pay check.
“And 7-Eleven says its grocery sales have jumped 12-13 percent over the past year, compared with only slight increases for non-necessities like gloves and toys. Shoppers can’t afford to load up at the supermarket and are going to the most convenient places to buy emergency food items like milk and eggs.”
I’m never hungry enough to pay for groceries at retail prices, and will always wait for a “sale” price. I’ve learned not to be picky when I eat, and will eat days’ leftovers. My husband and I have trained our kids to be the same way.
Oh give me a break. You must not follow prices very well, because in some places, the convenience store milk prices are well below the grocery store prices.
Dunno about eggs at convenience stores, but Walgreens sells them lower. Also shredded cheese on sale for less.
If you watched prices carefully you would realize that this trend is only people economizing!
Just wanted to go back to post that suggested that gas prices were low despite high oil prices because refiners had decided that gas prices over 3 bucks a gallon were hurting sales and thus profits.
Valeros refining profits way up in July
http://www.marketwatch.com/news/story/valero-profit-jumps-19-strong/story.aspx?guid=%7B7229B6D1%2DEF44%2D4023%2DB71B%2D03128009EE8B%7D&siteid=yhoof
Here is what gas prices were doing the quarter before
http://tonto.eia.doe.gov/oog/info/gdu/gasdiesel.asp
its a lie they have cut margins to protect the economy is it to protect administration???
Previous posts suggested that the reason gas prices hadn’t gone up despite the fact that oil prices have gone through the roof was due to refiners deciding that keeping oil under 3 bucks a gallon was more profitable.
This is completely wrong
July 31st 2003 valero reported record profits
Valero Energy Corp. rode near record-high refining margins to a 19% rise in second-quarter earnings, taking advantage of strong fuel prices during a period plagued by an unusually high number of refinery outages across the U.S.
Meanwhile gas prices were north of 3 bucks a gallon during the 3 months prior
Thus refiners have chosen to keep margins low in order to prop up the economy. Was this done to help their benefactors in the white house ?????? My guess is yes.
Scroll to the bottom of this Ebay auction:
http://tinyurl.com/2cq8je
Maybe the guy is afraid that his kit is junk and does not want anyone to pass the junk on without him getting his royalties? Bwahahaha!