Bits Bucket And Craigslist Finds For November 3, 2007
Please post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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There are 10^11 stars in the galaxy. That used to be a huge number. But
it’s only a hundred billion. It’s less than the national deficit! We
used to call them astronomical numbers. Now we should call them
economical numbers.
- Richard Feynman
Just in case someone were interested in a primer on the Central banking scam and the basis for why we, as a nation, are in deep doo doo, this is an excellent article.
http://www.dollardaze.org/blog/?post_id=00255
If you are going to read that then you definitely need to take the time to watch this.
http://tinyurl.com/37txmd
I think most people on this blog have already seen this but it sure is good to review once in a while.
Please stop waving that pen!
That is way off. The Rothschild view of inflation makes it out to be “the cure that kills”, and they would never encourage it. This piece does not give credit to people fighting deflation which would be an even more serious problem with modern levels of growth. Wanting money to hold value without participating in markets turned out not to be a good idea, and it encouraged the wrong things. At the absolute worst we might abandon one fiat currency for another. None of this changes the essential point which is that money is a social contract and not just a metal or other such asset.
“None of this changes the essential point which is that money is a social contract and not just a metal or other such asset.”
And social contracts are easily abandoned or twisted to protect the interests of the highly-privileged few at the expense of the slightly-clueless many.
“Man is a strange animal. He generally cannot read the handwriting on the wall until his back is up against it.”
Adlai E. Stevenson, Jr.
LOL,
I was listening to business radio talk show here in Houston a month or so ago and this older guy (who sounded a bit far-out) calls in and asks the host whether shorting financials made sense, given the subprime situation. The host basically said: “look at the analysts that do this for a living, they’re not too worried, and they think the worst is behind us.” The host continued and pretty much said: “so who the h3ll are you to second-guess these experts, you’re just a Joe Smoe.” Unfortunately, the caller tended to agree with the host…Luckily I didn’t listen to him.
Actually, I listened to you guys…thanks.
I wonder if Ben Stein has found enough ointment to ease the pain in his sphincter.
If he has, then I’m sure we can find some volunteers around here to reapply the Joshua Tree.
Would one Joshua Tree be enough for both Ben Stein and Donald Trump?
a twofer
Oh no, Donald would recieve a special “treatment”. I’m talking the General Sherman sequoia for that rat-bastard. It may not have the spiny protrusions of our beloved Joshua, but I think the girth will more than offset that deficiency.
The Sherman Tree was originally named the “Karl Marx” Tree, by the socialist utopian society that held legal rights to the ground on which it stood, until it was taken away from them and made into a National Park…
The only thing certain about the Karl Marx tree coming down on him is…
It wouldn’t mess up his hair.
“so who the h3ll are you to second-guess these experts, you’re just a Joe Smoe.”
Unfortunately, that seems to be the attitude toward members of the general public on many levels of business, government and media. Ever watch a media punditry show like Washington Week, Chris Matthews, etc? What a complete waste of decent air time, on most occasions. It’s just a bunch of media types in a self-congratulatory setting, all cozy and clubby and tickety-boo, aren’t WE the smart folks putting it all in perspective for you, the disadvantaged Joe Schmoes who don’t know any better. They’re so drippingly condescending, not to mention disconnected from reality. Sometimes, when I do tune in, if it is an issue I’m interested in, I wonder if they live on the same planet as the rest of us.
A buddy of mine commented the other day, after having some argument with a local businessman, that everyone wants to be one of the “elite” these days.
I turned on “Smart Money” for 5 minutes last night. What a bunch of worthless, pompous f—ing a##holes. The $hit that they were saying was so stupid that I almost put a brick through the f—ing TV. So, I did something drastic. I turned the channel.
NYCityBoy, do I EVER understand. I wonder how many people are turning the channel. Many moons ago, just out of college, I got into the advertising game. Media buys (purchase of advertising time) were based on numbers from ratings agencies like Nielson, Arbitron, etc. I assume that’s still the case. I would venture to say that, just like the financial ratings services who rated the credit backed securities, the numbers are severely jiggered. I don’t think there’s any way of measuring how many people watch a particular program any more and I would venture to say that most advertisers are being majorly ripped off. I look at the news anchors, talk show participants, reporters, etc. and think how way overpaid they are for what they do. If Brian Williams and his shoulderpads were being paid based on ACTUAL viewership, he’d probably be worth about $50,000.00 per year, LOL. The media market is so splintered now.
“If Brian Williams and his shoulderpads were being paid based on ACTUAL viewership, he’d probably be worth about $50,000.00 per year, LOL.”
And I base that on the fact that, whereas I used to watch the evening news fairly regularly, in the past few years, not so much. A lot of times I’m here on this blog and don’t even have the TV on because I’m to lazy to reach over and hit the clicker.
Talk about media people. I just saw on ESPN that A-Rod won’t even talk to the Yankees unless the opening offer is $350 million.
Thanks to A-Rod and others Saturday is my favorite sports day.
GO PENN STATE!!
Thanks to A-Rod and others Saturday is my favorite sports day
And how much is the starting quarterback for Penn State being paid? Student Athletes is another joke on the American public
This is so hard for me to understand. Yankees fans don’t even like him. They tolerate this arrogant jerk as long as his numbers are great. In Boston they love David Ortiz and Manny Ramirez. In New York they love Derek Jeter. I could see paying some premium to those guys because the fans like them. But Rodriguez for 10 more years in this town? What a joke! There is definitely an Alex Rodriguez Bubble. We will see if the Yankees are dumb enough to buy in.
When I was a lad, the mvp of the all-star game would receive a corvette or some prized ride and man, was that one happy camper…
It wasn’t uncommon for a major leaguer to have another job in the off season, either.
Andy Etchebarren, catcher for the Orioles in the 60’s and early 70’s, had a liquor store in my hometown.
You guys are proving my point. Programming is not based on the wants and needs of the people, really, but what corporations want or what they THINK people want. Do people really want what’s on TV these days? The Singing Bee in prime time? Oh, please, give me a break. Joey Fatone is a piss poor Dean Martin substitute and obviously the budget is so tight they can’t even get Fatone a decent tailor. (Yeah, I watched it twice, call me a sicko, but sometimes popular culture is a train wreck you just can’t look away from). And then they bury some decent (IMHO) shows like Dirty Sexy Money and Journeyman.
The Yankees need to walk away from A-Rod in much the same way Oracle walked away from BEAS system. Let them joke on their own greed and humble up.
Funny enough, my family was a “Nielson” family a year ago and yet none of the shows we watched were the top earners.
Go figure.
ok Danni Nielson : )
Has a nice ring to it…
A-Rod is going to Hollywood…..Perfect fit….He can move next door to Barry Bonds….They are a perfect pair….
You guys just don’t get it. If the money doesn’t go to the players, it’s just going to go to the owners. You think A-Rod is unlovable? Try Hank Steinbrenner.
You think the owners will drop ticket prices instead? Ha. Ticket prices have nothing to do with player salaries. Ticket prices are set to maximize revenue, which is totally independent of costs.
These gangsters are preying on mom and pop, fully supported by their corporate ahole buddies. Cramer, Cocaine Larry, Smart Money, these people are all slime.
So true, but what REALLY annoys the elite is that most of the “little people” vote, and they are the majority in this country.
I’m sure the moneyed interests backing the various campaigns wish there were a way they could paste ads on the persons of the candidates, kind of like the guy who sold his forehead for advertising space on ebay. It would be a kick to see all the candidates at the televised debates with ads on their foreheads for banks and brokerages, WalMart, etc.
But who really gets to choose the candidates?
The candidates more or less choose themselves, if they have enough money, or think they can get enough money and think enough people might like to hear what they have to say. If they file all the proper paperwork, etc., it’s off to the races. It’s after that, I think, that people get weeded out or promoted by special interest groups, etc.
But that’s my point. Who is left after the “weeding” you allude to?
The last time the “little people” in my country actually voted down something the elites truly wanted was in the Republic Referendum.
We’ve got an election in 3 weeks, and there’s really no choice at all because there’s no significant difference between the 2 parties.
“We’ve got an election in 3 weeks, and there’s really no choice at all because there’s no significant difference between the 2 parties.”
Nor is there a difference here, despite rhetoric to the contrary.
Anyway, no matter where we live we’ve got to stop calling ourselves “little people” and the ruling, babbling turds “elites”. I’m gonna take a lesson from my buddy’s experience, next time I call one of my representatives and they ask me what group I’m from, I’m gonna say I’m one of the “elite”.
–
“But who really gets to choose the candidates? ”
Don’t ask tough questions whose honest answer will destroy people’s faith. People need to hold on to their deeply held beliefs even if they are false in practice.
Jas
That’s because we now longer live in a representative republic where we choose electors to pick or elected officials. the electoral college was made for a reason.
YOU choose the person locally who you think shares your values and desires. THEY elect the Govenor/Senators/Congressmen.
This keeps MONEY from buying the election.
With single one-man/one-vote systems, the one with the best media campaign wins. Period.
So money runs the country.
A case in point. In Florida Bob Maritinez became Governor here before becoming appointed a Federal Jobs. He won EVERY county in Florida on the recommendations of all the press except ONE, here in Hillsborough County. WE knew who he was and voted AGAINST him. The other 66 Counties did what the papers told them to do.
ozjah:
This has been the biggest political scandal in America and it was buried. You really must have an open mind about this.
Our Fair political system has been destroyed by refusing Ross Perot into the presidential debates in 1996
He had $18 MILLION of our taxpaying dollars and because the other parties had Double that and could raise a ton more, Perot chose to be thrifty and spend it all after the debates.
Well the FEC said Nope your numbers are not high enough so you are not allowed into the debates.
So what did my network Court TV do…NOTHING, the number of times i almost got fired for wanting our network to see the LEGAL implications of a 3rd party candidate with OUR tax money denied equal access. We check off the $3 box on our tax forms each year….right? I mean Terry Moran was sympathetic, but still the higher ups Nope.
So what did the Fox network do..Nothing and i had friends who were show producers, and they wanted nothing to do with Perot, yet it is an excellent legal question. Same with ABC NBC CBS no body assigned a crew to follow Perot, after he was denied entrance to the debates.
We could have had a viable 3rd party…that would probably be our last chance in America…i just don’t think ron paul had the same charisma as Perot…LOL
“look at the analysts that do this for a living, they’re not too worried, and they think the worst is behind us.”
It strikes me as most amazing that a ragtag bunch of bloggers, some of whom wear tinfoil hats at time, have collectively left a cadre of highly paid Wall Street analysts in the dust.
Wall Street Analysts?/
We’ve left the CEOs in the dust…and their CFOs …Prince can now join O’Neal and old Purcell at the Golden Parachute Ranch in BFE. The new business model, become CEO, trash the franchise, exit with hundreds of millions after failing and look for a book deal for more money. America’s a great country or what?
I hope street criminals are paying attention to where these golden parachutes are coming down; there is lots of money to be collected there.
‘The new business model, become CEO, trash the franchise, exit with hundreds of millions after failing and look for a book deal for more money.’
Ben Stein’s dad had an appropriate saying to describe the sustainability of this new CEO business model:
“Anything which cannot go on forever will stop.”
That’s like an old surgeon’s saying:
“Bleeding ALWAYS stops.”
“look at the analysts that do this for a living, they’re not too worried, and they think the worst is behind us.”
Most (not all) of the analysts wheeled out for talk shows, especially for big investment banks, are under orders to shill for their organization’s sales products. You don’t get ahead in these political organizations by revealing unpleasant truths, even if you are eventually proved correct. Most of them are self-promoting careerists with little or no interest or insight into discerning what is really going on.
There are some really good astute analysts, but the ones with integrity usually work under the radar and have no stomach for the showbiz/politicking required for the big corp/media circuit.
What I found most interesting about the ex-Prince of Citibank was…
The timing of his axing, on a Friday afternoon~
Monday will be very interesting, to say the least.
C was up 3.47% after hours. Good luck keeping that going. The knife catchers are out in force at the WM message board. They are the same idiots that have been buying the homebuilders for the past 14 months, always calling “the bottom”.
Yep, thats why things are down 5 then up 2, down 5 then up 2 or 3.
The guy on TV yesterday, Rogers was his last name, was shorting Citi. They asked, “What do you make of this.”
He says, “I don’t know but I will have to cover and then see how it plays out.”
Any news of a change causes a cover or pop in the stock. Doesn’t mean it’s a positive change. Just shorts covering is all. They have to do what they have to do.
Is there any info on the exact reason for the firing?
Did he condone/oversee/suggest some funny accounting practices?
I don’t know, but I can think of 2 significant events that occurred during the week.
1. Meredith Whitney’s downgrade of Citi, accompanied by her reasoning (for which I understand she has already received death threats).
2. The Fed’s statement that they will be enforcing the Basel II recommendations (which I think have to do with capital/reserve ratios).
As long as the Ponzi scheme was working and the FAKE financials had everyone believing this was a legitimate business organization, no one cared.
They are sitting on a LOAD of LOSSES and hiding as many as they can.
He is a useless idiot that has lost the company lots of money by sitting back and allowing all this crap to go down.
Think Franklin Raines.
Another EEOC idiot that collected lots of money before the truth finally came out.
in Netherlands (and probably most of Europe) most banks are still claiming zero losses as a result of the subprime problems, because all their mortgage debt is AAA rated etc.
It could take years before we know what they are hiding as no one can force them to be honest, and apparently the shareholders don’t want to know the real situation.
this is Enron and WorldCom all over again, only in financials rather than tech.
OFF-BOOK accounting. It’s the work of bookies, not legitimate businesses.
I know a couple of local businesses that keep two sets of books here, too. One for the government, and one for the proposed buyer, the so-called “real numbers”.
The GAAP should require disclosure, so now they are selling them off with a promise to “re -buy” later at full 100% value plus return. the question is, would you trust them to pay you back?
Because of the very fact that Corporations are playing games with disclosing their losses is the very reason why the Stock market is a rigged game . When the talking heads made statments to the effect that they do not know the extent of the losses to lenders /Corporations involving the sub-prime mess ,but yet they start fast talking how good the global markets are , it should of been a clue that the stock market was going to have some down days .
The stock market gets a rally going on all the cheerleading ,than the talking heads report some bad news about financial, builder or lender stocks ,than a sell off takes place ,than the cheerleaders talk up the market again and a rally takes place and than another piece of bad news comes out ,than the cycle repeats, and than Wall Street starts calling for a rate cut from the Feds.
Maybe a smart investor can make alot of money on this up/down stock market ,but it’s driving me crazy .
then????
Of those 103,000 jobs, 14,000 were in the construction industry, and 25,000 were in finance. Does anyone believe that all those new companies are being created in those industries now?
http://norris.blogs.nytimes.com/?ref=business
Those are “Tass” like numbers…
We sound so very Soviet.
Look, you just need a guide to stock analysts recommendations. Here is my little explanation of a stock analysts buy, sell, hold rating system. If you see a buy recommendation, then that means that the analyst’s firm is in contract negotiations with the sotck’s company. Strong buy? The stock’s company has just contracted to do a lot of business with the analyst’s firm. A sell means the company went BK (aka Tits Up) last year. A hold rating? Dear Sir This Is A Family Blog!
Roidy
Here,
http://www.safehaven.com/article-8753.htm - read section called “payroll Survey Sausage”. It will explain why the numbers don’t work in a very understandable way…
Still waiting for a response on my short sale offer to a FB. 190K on a house with a 340K balance. FB accepted it, waiting on the lender. The lender would be a fool to reject this offer. There’s a foreclosure around the corner now, a new house, listed at 180K.
Why try to buy now? Prices are sure to be lower next year.
Now before everyone piles on txchick, keep in mind that probably half of the people on this blog are homeowners (me included), and most of the other half don’t have a problem with home ownership in principal, but we do have a HUGE problem with people paying way overinflated prices for homes (especially when they have virtually no hope of meeting the terms of their loan), and a huger problem with the REIC giving loans to these people. Paying $190k for a really nice house definitely means that txchick is still on our side.
Yes, I am. This is a 3500 square foot house on over an acre of ground. It’s in excellent condition. If I get it for that, I’ll be quite contented. I haven’t been in the market for a house since 1987. I’d pay cash for this and it would be a steal. The only downside would be having to live with foreclosures around for awhile but that doesn’t bother me.
I knew it, but wow, $54 per square foot is AWESOME.
Can’t replace it for $54. per foot…$54. per foot is close to material cost alone…I don’t think Chic can get hurt on this one 3 to five year out…Hope you get it Chic…
Why would you buy in a neighborhood, with foreclosures surrounding you?
Perhaps the most important consideration in the coming hard times, will be the financial sustainability of a given area.
If 6 out of 20 houses turn into McCrack houses or McMeth houses in your ‘hood, it’s not long before the other decent neighbors say, adios.
That would be my fear too. I’d wait two or three years to see what type of neighborhood that turns out to be. Perhaps prices will come up in that neighborhood in two years and you lost a good opportunity at $54 per square foot. But then you will be sure of what type of neighbors you will be living next to. It’s one thing to pay low for a place to live, but it’s at least as important to enjoy living in that place.
The situation is dynamic. Predicting how any neighborhood will turn out is like predicting how the stock market will do over the same interval. Whoops, I forgot we’re talking about txchick57 here.
Where is the house located?
What would your Property Tax base be if you got it for that price?
If you get it, make sure the purchase price is entered as a comp in the market (as a service to your fellow HBB’rs) and immediately petition the county for a tax reduction!
Of course. That goes without saying.
Is this the mid-century house of your dreams?
No, I wish. I see many of those I like but they keep getting “snapped up” since they are mostly in the inner city.
I am coveting one in University Park, but, you’re right, there don’t seem to be any deals here. Am really looking forward to my next trip to Big D and my first visit to the Nasher Sculpture Center!
There was one in the White Rock area I had high hopes for. It was listed at 289K which I thought was ludicrous. I informed the realtor I’d pay 238K which was the tax value. It sold in 10 days for 289K. Pissed me off big time.
TxChick,
Remember that every time you call a realtor, God kills a little kitten.
LOL. No realtors involved here. Just me, the FB and the bank. Found this dude on Craigslist.
LOL you are truly a shark, I’m impressed
About a month ago I put out my reasoning for putting every last Cent into physical Gold Bullion…
I feel 10 times more urgency, right now.
The rampant fraud and dishonesty was in every nook and cranny of our financial system, from the top on down.
Very soon, the Dollar will be getting whacked, and all stocks, t-bills and cash money will all suffer a rapid decline in buying power.
Amazingly, at this late hour…
You can still perform modern alchemy, turning paper into Gold.
“The rampant fraud and dishonesty was in every nook and cranny of our financial system.”
True. But the operative word in your statement is the word “was”. What “was” is rapidly turning into “isn’t”.
Witness the recent headchopping going on in the financials. Also note that the FBI is becoming quite interested in the financials lately. These are signs of a cleansing taking place, a healing, the repair of the System.
This is one massive enema that is taking place. They are dislodging stool that originated in the ’90s.
Thanks NYC. Your metaphor finally got things moving for me this morning. Gotta go……..
The same metaphor is behind a blog entitled {The Annals of Stock Proctology.}
80’s
Yea you can give me a headchopping any day along with the $155 million golden parachute.
Can the FBI get me in the Cayman Islands?
“Can the FBI get me in the Cayman Islands?”
Theoretically, no. In practice, there’s always extraordinary rendition.
Well within the range of a cruise missle. Maybe the next president will go on a “bring them to justice” kick.
All kidding aside, I’ll bet that with all the surveillance and wiretapping going on, the FBI/HSA/Blackwater has all the information, photos, recorded telephone conversions, etc. about who’s going to Switzerland, Grand Cayman, et al and how much money is being moved. Probably a lot of occurrences a la that scene in “Training Day” where someone’s loot is liberated by government forces.
you were/are so right; unfortunately I listened to some gold advisers like SKI in the last year and as a result I’m mostly out of the gold market now
I’m itching to get back in (like many others I guess) but it is just too risky after the huge runup of the last 2 months. I guess monday will see a new all time high in the Euro goldprice and that could give gold prices another boost. And if the ECB decides to cut rates this months too (they are under strong political pressure), all bets are off.
I gave up on SKI last year thankfully…flipping a coin would have been more accurate.
I wouldn’t wait for a pullback, we are heading for $1000. Currency devaluation is accelerating and it will become impossible to get physical gold sooner than later. People won’t sell it unless they have to (I know I won’t). IMO metals will be outlawed, currency controls imposed and the longterm price of gold is over $3000.
Silver has huge upside as most people will be priced out of gold soon. Get in.
Last week a friend that probably buys and sells more physical Gold to the public and wholesale, than anybody else in the city of angles…
Told me that there was 5 sellers for every buyer, in terms of people.
And many of the sellers were only selling to meet mortgage payments…
The buyers made up for their lack of presence, by buying much more than the sellers were selling.
So more metal is going out the door than coming in, and all of the metal is going into Strong Hands, and there is just so much physical Gold available…
“I’m itching to get back in (like many others I guess) but it is just too risky after the huge runup of the last 2 months. ”
Risky? If you think of the us$ as a reference and gold as a commodity yes. This is not the correct frame of reference; gold is the fixed reference, and it is the dollar that is held up by mutually agreed upon confidence. So change your statement around a bit.
“I’m itching to get my money out of such a volatile asset (US$-s) (like many others I guess) but perhaps its due for a dead cat bounce after the tremendous devaluation of the last 2 months. ”
and change
“I guess monday will see a new all time high in the Euro goldprice and that could give gold prices another boost. And if the ECB decides to cut rates this months too (they are under strong political pressure), all bets are off. ”
to
I guess monday will see a new devaluation of the Euro also and that could reduce the value of the Euro as an alternative place to park cash.
just for the record: I’m from euroland so I have most of my money in euro currency. I agree that gold itself is a better reference (and store of value) than euros or dollars, but I don’t believe the (euro) gold price is going to the moon in one shot. Parabolic moves in gold like the current one usually are followed with even faster plunges (even if they don’t correct all the way). There can be a HUGE plunge now without even damaging the uptrend in gold. Of course this time COULD be different but I’m not betting all my euros on that. If the ECB decides to follow the FED by cutting rates and/or gold significantly surpasses its previous EUR 560 high, that would be the time to jump out of euro currency into gold.
Exactly. I think it’s likely that gold will move higher. The market is people who are worried about fiat currency. That market is likely to get bigger as we slide into recession. But at some level, Au is pure speculation. The attraction is that the supply is relatively fixed, at least compared to the supply of money. But aside from a small amount used for jewlery and electronics every year, the demand is driven by speculation that demand will grow. It’s a pure momentum bet, and like it has before it is likely to reverse at some point. While I think it will be awhile before this happens, I have zero confidence in my ability to figure out exactly when it will.
NHZ, Everyone has their perspective. You are in Europe. Maybe there things don’t look so gloomy compared to the U.S.
Here we see the dollar near record lows. And it’s not backed by anything. Your Euro is partially backed by gold at least. We have “Helicopter Ben” at the helm. We have a major entitlement mess, especially with aging boomers ready to force us into socialized health care. We have to pay for a war against terror. Worldwide we have hundreds of millions of new motorists and more hundreds of millions in a decade from then - in China and India. We have V.P. Cheney admitting oil production has been increasing 2% per year while consumption/demand has been increasing 3% per year. That affects you there in Europe too. Resources are more precious with the growth of the middle class in Asia. For us, we see the 10 year note still around 4.4%. I think that is a cheap yield and I’d be concerned about holding my gold if it was above 8%. We are a long way from 8% still. $800/oz gold in 1980 was accompanied by 10% (or higher) notes. $800/oz gold in 1980 is equal to $2000/oz gold in 2007.
I can see gold going above $1000 per ounce in 2008. I am too chicken to put 100% of my investing in any one asset though. I learned a lesson from participating in real estate in the 80s/90s and from from watching internet stocks in the late 90s and watching the current real estate bubble.
I know of a good coin dealer here in Maryland who’s shop is open on Saturdays and accepts cash. He’s almost as good as the coin shop I like in Los Angeles and is on the list of gold Eagle/Buffalo and platinum eagle dealers by the US Mint. A colleague at work also is a good source of buying coins. He sells at my LA dealer’s sell price.
Unlike Aladinsane, I have no fear of T-bills and the like. government can print more money and pay the interest on them still. I consider them a hedge against my own mistakes.
So far we have a slow bubble burst, but this big Citibank issue could speed it up. Or something else could. I’m hoping for several more years of slow deflation in RE so that I can continue to build up my metals and government securities.
My main hobby is to focus on my physical health, avoiding obesity and avoiding other excesses. It’s good to have other obsessions than a strive to financial freedom. It makes life more interesting. It’s also good to have some indulgences. My own indulgence is travel. I fly to Arizona every other weekend. I will really need it this winter to keep my mental balance while being here at the Mid-Atlantic. Nothing like having sunshine and 68 degree temperatures and no humidity in Phoenix in January!
we have an even slower bubble burst in Europe and our RE bubble has not even burst yet. Just like in the US, some time the fiat system is going to unravel and if some big banks go belly up that might speed things up in Europe too (because these banks are all connected). EU inflation numbers are just as much a lie as they are in the US (M3 growth 14% and official inflation 1.5-2.5%), but most of the sheeple haven’t noticed yet and many still believe the good times of free money are here forever. The writing is on the wall, but on the other hand, I wouldn’t be surprised if they can delay fiat currency reckoning day for another 5 or 10 years - and that’s a long time.
I converted all my USD into Euros about a month ago and have already made a quick 3.5% not including the interest earned. I also set up the infrastructure to make the next move to mellow yellow.
I’m also mad about saffron, but only in rice dishes…
Good one! If I ever buy gold I certainly wouldn’t want it kept in Russia therefore I need to take a couple extra steps.
Palladium is a better bet than gold right now, IMO, given its rising industrial usage as well as its overlooked (so far) precious metal status.
“190K on a house with a 340K balance. FB accepted it, waiting on the lender.”
Holy Devaluation, Batman! LOL, you bring up an interesting point. Anyone who is underwater, realizes the market is not coming back anytime soon and just wants out, will be inclined to accept pretty much any offer, since foreclosure will be an inevitability anyway. Now it won’t be the FBs who will be stubborn, but the banks. Remains to be seen if the banks will be as stupid on the way down as they were on the way up. If you really want this place, I hope the bank plays ball, but let us know, because that will give us sort of a feel for the mindset of the banks at this point in the bust.
I gave them a good package including nearby builder foreclosures on new houses listed for less and not selling. I remember how we did this in the RE bust of the 90s.
You are screwed now, Chick. You are trying to reason with them. That seems like an antiquated tactic. I hope the package you sent included some drawings that were done in crayon. Otherwise it will go right over their heads.
Good luck. If the deal works for you go for it. This will be a success story for the blog.
“How good information from Ben’s Blog can save you thousands.”
The bank should NOT accept it. They should make the seller PAY IT, for the next 20 years.
You guys that like all this “walk away” attitude seem to forget that ALL OF US are banks customers. This is killing the financials, and though they deserve a good spanking, it is devaluing their income stream and making them insolvent.
That is not good for the country.
I don’t care about FB’s. They drove this insanity by buying things they could not afford. If you can’t make the payments and don’t plan on staying, you have NO BUSINESS buying a house.
what’s done is done. There will be a loss. The only variable is the size of the loss.
I realize the loss is coming. However, SHORT SALES generally say the bank will eat the loss.
I think the bank should agree to the sale in foreclosure, and go after the seller for a deficiency judgement. I don’t think people should be able to “walk away” from debts. It creates a false economy that encourages bad deals and fraud. Bankruptcy for mortgage debts should be about a new payment schedule……………for the next 20 years.
That puts and end to the “speculation”, because it’s no longer gambling with the house’s money.
The financials committed suicide when they created a ponzi scheme based upon making loans that the borrowers had no realistic chance of paying off. They just haven’t realized it yet. Contrary to the opinions voiced here, you will always have an easy time finding people happy to borrow money. It when it is time to repay it that they start to whine. The only way to limit boom/bust credit cycles is to make people reluctant to lend potential deadbeats money.
“Contrary to the opinions voiced here, you will always have an easy time finding people happy to borrow money.”
I second that opinion. So far as I am aware, the burden of screening out bad credit risks has always been he lender’s burden. There have always and will always be people who will gladly accept a loan regardless of their potential to repay it.
I’m known around the office as being a cold-hearted ba$tard. It isn’t really true. I have sympathy for many, many people. Last week I visited a friend. Her story, although of her own making, did make me feel bad for her.
I was in Boston for the weekend. I hadn’t been to Boston since November of ‘05. At that time the market was booming. It was different there. Prices would never come down but it was already becoming obvious that the market was maniacal. Our friend bought in the summer of ‘05. It was a three-story converted into condos. Her place is in South Boston in a transitional neighborhood. Parking is awful. But it is very close to downtown and I liked her condo. I would have probably paid close to $200,000 for the condo. Well, $150,000. We were horrified to hear that she paid $380,000 for the place. My wife and I thought of doing the intervention but nobody at that time wanted to hear.
Let’s fast-forward to last weekend. We were talking at the conversation meandered to real estate. By now she has about $400,000 into the place. It is clear that she knows she would be unable to get $300,000 for her place. The number might even be quite a bit less. It was sad. She works hard and is a good saver. She is not an FB. There is no toxicity in her mortgage. But she is probably stuck for a long time.
The price decline numbers we are seeing are bull-plop. Look at this one personal example in “it’s different here” Boston. This place is down at least 25% already and maybe close to 40%. My friend told me that her sister that bought in the Boston burbs in ‘03 or ‘04 would also not break even if she tried to sell right now. There is hope that the market will bounce back. What was that movie called? Oh yeah, “hope floats”. So do turds.
She is not an FB.
She IS an FB, but you believe she’s going to be willing and able to suck up the losses going forward.
This is what happened with the majority of underwater owners in both Australia and the UK (and California??) during the bust in the early 90’s. People were prepared to take a lot of hurt to keep their homes.
In fact, I think remembrance of this attitude might just have entered the lending paradigm. If so, that could make matters worse now because investors won’t, and a lot of FB’s just can’t, work through the pain.
Good correction. She is an FB. She is not a “completely over her head” FB. She is a great person so I hope she comes out of this okay. She can’t just walk away without leaving a lot behind. She has a lot of skin in the game.
Good information. These people just would not listen to reason. The believed that you can’t go wrong with housing and that prices ALWAYS go up so buy now or be priced out forever. Now they are stuck. Now they learned their lesson. Hopefully many do. This will cause this kind of crap from happening any time soon I HOPE. It will eventually happen again. We rarely learn from history once we forget about it.
They had a lot of help “believing” this line of crap.
Remember “Suzanne says you can do it, she researched it”.
from the REALTORS(tm) group.
They sold the public fear………..buy now or you’ll be priced out forever. Remember? They are a bunch of scumbags.
It’s funny to me that many people who are good savers and very frugal fell into the FB trap. I’m thinking of several people I know well. I’m not like that myself. Although I am not in debt I am not a coupon clipper and there are quite a few things considered luxuries that I like to spend money on. But the thought of overpaying for a house gives me hives. It’s amazing to me that many people who wouldn’t splurge on a great meal will sign up to overpay 100,000+ on a house and do almost zero research.
“It’s funny to me that many people who are good savers and very frugal fell into the FB trap. I’m thinking of several people I know well. I’m not like that myself.”
I’m not like that either. However, I also lived through the economic hardship of the seventies and early eighties, which calloused me several times over. Note that Oedipus couldn’t “see” clearly until he gouged his eyes from his head. Today’s young are just beginning to “understand” how the world works.
The guy who painted my little condo in Cambridge (rented for the past 6 years; positive cash flow & swell tenants!) told me he just bought back a house he used to own in Jamaica Plain for 50 percent less than what he sold it for in 2005.
NYCB,
your friend, decent and reasonably frugal, is now a member in good standing of the mortgage serfs of America. She’s literally stuck in place, until she can bear to suck up her losses and walk away. Otherwise, many of her future decisions have now been made for her–she’s not free to move for a new job, she can’t escape rising property taxes, her discretionary income will be limited by that mortgage et. al. Any hope, as Huck Finn said, of “lighting out for new territory” is now closed to her until she can take those losses. And in an economic winter, making up losses is a hard road to travel.
Your friend may be a good person, but in my book, she did her bit to jack up prices and feed the bubble in the 2004-2005 run-up. As such, she gets no sympathy for me. Too many decent families have been priced out of good houses and neighborhoods because “good people” fed the bubble.
I do really feel a little sorry for people who have skin in the game ,who were honest on their loan applications ,and are now stuck in a house or condo that they would take a loss if they sold,(especially if the FB saved alot of money for a down payment). I was in the same spot a couple of times with the house I sold in 2005 that I lived in for 23 years . I was lucky that I never needed to sell during that timespan , that some down cycles took place, and I could afford my payments .
I guess there are alot of good people who just thought the real estate market was stable and they just wanted a little piece of the third rock from the sun before prices went up more . Sure the FB purchase fed a fake market ,but that’s alot different than a greedy investor, with no skin in the game ,that lied on their loan application, who was betting on a short term profit .
Right now I have a neighbor who is walking from a house they bought with no down payment on a toxic loan . It’s the only foreclosure in the whole project that I live in and I have to look at it everyday . The owner owned I think 6 homes before they purchased the one that they now have walked from . Apparently they tried to do a short sale ,but the bank didn’t accept it . The owner has alot of assets and equity in other property and I just wonder why they think that the bank should pay for their error in judgement on a house purchase, and they were clearly speculators that bought at a high .The other day cops showed up at the dwelling , with a clipboard ,looking for the owners ,(the house is vacant ). In the meantime the lawn guy is bitching to me because he hasn’t been paid for 5 weeks for taking care of my neighbors lawn .So anyway, my ex neighbor is a different sort of investor than the FB that New York City Boy described I think .But ,anyway you look at it ,the nice people are going down along with the greedy FB’s that fueled the market .
The homebuilder stocks get discussed on this board all of the time. They get big play from the CNBC and media blowhards. Just yesterday the blowhard “jenius” Bill Miller stated that the homebuilder stocks will be great over the next 5 years. That guy should do standup. This occurred on the same day that many of the builders got cut to junk status.
The table below is an example of earnings estimates for one of the builders. In this case it is MDC. For 2 years they have continually been walking down earnings estimates for these shysters. Look at the change in just the last 90 days. For those of you that don’t actively follow these disasters, this should be an awakening. Who believes that we are anywhere near done walking down the HB estimates? They are now trying to say MDC will lose $.81 next year (average analyst estimate). I would guess it will be closer to this year’s $8.00 loss that is predicted (still optimistic). My point is just how dishonest and stupid the Wall Street community is. This is but one example.
Earnings estimates for MDC (I hope it formats correctly):
Current year Next year
Current Estimate -8.02 -0.81
7 Days Ago -6.44 0.02
30 Days Ago -6.00 -0.33
60 Days Ago -5.66 0.14
90 Days Ago -4.11 0.60
MILLER is so far underwater he’ll never get out and talking his book is really just shameless…..I hope the monkeys can pump Lennar back to 25 so I can reload for the trip to 15.
Agree. He caught a falling knife on these HB’s last year (calling a bottom then) and is down big! He is looking for some suckers to take these losers off his hands.
Don’t forget the financials. Miller is loaded up with Countryfried! Or is it Countryslide?
I posted this late last Saturday but I don’t know how many people saw it. I was able to get my hands on an instructional video that lenders were sending out to their collections departments. It is very interesting to see the collection tactics the lenders are advocating. It should be interesting to see what this does to the foreclosure rates.
http://tinyurl.com/2j9co7
That is pretty sick - I can see why you say that “I’m known around the office as being a cold-hearted ba$tard”.
I agree with you Wamu. This is pretty sick. If only Brian had paid on time, all of the bloodshed could have been averted. Of course you are probably mad that a large government bureaucracy wasn’t setup to address the issue. Maybe next time. Have a good day.
LOL… Good one.
Almost ideal. Had a Joshua tree been introduced just prior to the flame-thrower, it would’ve been perfect!
That was great. I just say Family Guy for the 1st time this week. Loved it. Most deadbeats are nothing more than thieves. Deserve what they get.
say = saw
Opening up the mail this morning and got one of the usual offers- this time from Chase. What really struck me about this was the rate for cash advances. That rate is 24.24%. Earlier this week we heard that the number of people who are making mortgage payments with their credit cards is at record numbers. How many of these fools are now paying the Ultra Subslime rate?
You need to call up Chase and inform them that the Fed has cut rates to stimulate the economy. News travels slow. Maybe they didn’t get the memo.
I have a 0 interest credit card expiring the end of this year and am getting a 1.9% interest card expiring May of ‘08. These are very helpful to me in my situation of working on the east coast and flying home for the weekend every other weekend. I have the obsession of keeping my fees low, so I’m going to have $0 balance on all my cards in five weeks (including my frequent flyer credit card). My AT&T stock has been great the last few years, and certainly justifies having the teaser rate credit cards. But I’m cashing in on my AT&T. Have an 8% trailing stop on it. Hope to not hit the stop before December 4, as that will make the gain long term.
That sounds like a pretty good deal on your credit cards Bill especially the ones that give you mileage if you travel a great deal. I have probably earned a few international flights but I can’t bring myself to handover the information to enroll those programs. I have a couple of debit cards which are tied to interest earning bank accounts with minor balances in case the cards get stolen.
I’m a member of Equifax credit watch. Also my bank in charge of that frequent flier credit card is very vigilant in detecting fraud. Recently the bank detected a few small charges. They told me someone is testing my account and they immediately shut down the credit card. Minor inconvenience waiting for a new card and new number, but it probably saved me a lot of moolah. It’s always a good idea to read all your statements.
…and read them real-time too on-line, as I do on a daily basis. I had the same thing, a couple of $5.00 tests. Called up, cleared it, and got a new card. It probably shocked the fraudster that I nailed him about 3 days after he posted the charge.
http://www.slate.com/id/2175724/
Protecting Paulson’s Pals
The subprime collapse didn’t bother the Bush administration, until Wall Street bankers started whimpering.
The subprime mess has been spreading like toxic mold since the housing market peaked last year. So why did it take until now for the government to decide it should do something about it? I have a theory.
When individual borrowers began to suffer, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson didn’t seem overly concerned. The market would clear out the problem through the foreclosure process. Loans would get written off; properties would change hands and be resold. When upstart subprime mortgage lenders ran into trouble, Bernanke and Paulson shrugged again. The market would clear out the problem through the bankruptcy process. Subprime companies like New Century Financial filed for Chapter 11, others liquidated or restructured, and loans made to the lenders were written down. Meanwhile, Paulson and Bernanke assured us that the subprime mess was contained.
But as the summer turned to fall, and the next several shoes dropped, their attitude changed. And that is because the next group of unfortunates to fall victim to subprime woes were massive banks. In recent years, banks in New York, London, and other financial capitals set up off-balance-sheet funding vehicles called SIVs, or conduits. The entities borrow money at low interest rates for short periods, say 30 to 90 days, and use the funds to buy longer-term debt that pays higher interest rates. To stay in business, the conduits must continually roll over the short-term debt. But as they searched for higher yields, some conduits stuffed themselves with subprime-mortgage-backed securities. And when lenders became alarmed at the declining value of those holdings, they were reluctant to roll over the debt. Banks thus faced a choice. They could either raise cash by dumping the already-depressed subprime junk onto the market, or bring the conduits onto their balance sheets and assure short-term lenders they’d get paid back.
US Treasuries: it is discussed on this board from time to time, but can anyone explain to me why 10-year Treasury rates are at 4.3% (lowest value in two years)? Why would any sane person buy US Treasuries yielding 4%/year, denominated in a currency that drops about 4%/week? Of course EU pensionfunds and central banks couldn’t care less about loosing money, but we know that China and Japan have started unloading Treasuries (in small numbers though) instead of buying. Is the FED monetising all this debt?
P.S.: Libor rates in Europe dropped last week, and mortgages are getting cheaper again, so at least EU FB’s are profiting from the market turmoil. Also, difference between 1-year fixed and 20-year fixed is now next to nothing (both are a little above 5% here), bizarre …
Treasuries are looked upon as the safest of the safe places to put your dollars. No quasi-government agencies (FNMA, etc), no FDIC, no third party between you and your bucks but the organization that issues the bucks, the US government itself. In bad times you are first in line to get your money, even before those people lining up for their FDIC payouts.
For what it is worth, you are not paying state or local taxes on that return.
With that perception of safety comes a cost, and the cost is a reduced premium on your investment.
“Treasuries are looked upon as the safest of the safe places to put your dollars.”
This opinion does not necessarily hold up very well when the dollar is quickly devaluing. At such times, hard assets may prove much more effective as a store of value.
“Why would any sane person buy US Treasuries yielding 4%/year, denominated in a currency that drops about 4%/week?”
Perhaps they believe the U.S. dollar will bottom out before the real estate market does, which strikes me as a reasonable hunch. But your point is well-taken — why not save in U.S. denominated assets that always go up, like stocks, oil, gold etc, then convert to dollars either when you are ready to make a real estate purchase or when you are convinced the dollar has stopped dropping?
One more thing: Hoz pointed out the low T-bond yields may reflect a flight to quality from U.S. corporates into Treasurys. Asset quality is relative.
so we assume it still is mostly the flight to quality theme that is lowering Treasury rates? … wonder how much more dollar devaluation it takes before buyers panic … just imagine what happens when they all want out. Personally I don’t think the US dollar is ever going to recover, but maybe the euro etc. will soon share its fate - in that case US Treasuries might be preferred to Euro and certainly to Japan government debt.
I don’t know why anyone would bet on a bottom in the USD when we know the government wants to devalue it much more. As for low yields, that is a result of foreign government buying in the past (china) and government intervention now (US treasury will monetize debt as foreigners stop buying bonds).
I buy a few 10 year notes per year, but much more 3 month T-bills than 10 year notes. I like the safety of them, and the diversification. If we had 8% 10 year notes, I’d buy them like crazy, and just buy an occasional few T-bills.
“…government intervention now (US treasury will monetize debt as foreigners stop buying bonds)…”
That is my leading suspicion: The Fed and Treasury are running a ’share buyback program’ to shore up the asset prices of U.S. Inc. (both equity assets in the stock market and debt assets in the T-bond market). It really does not seem conceptually much different from a company issuing debt to buy equity shares in order to send a signal to the market that such shares are currently undervalued.
http://www.rockymountainnews.com/drmn/other_business/article/0,2777,DRMN_23916_5738328,00.html
Banker commits suicide to avoid jail time.
More to come?
“He’s gone from being the perpetrator to another victim of the fraud.”
Unbelievable … at least they seem to be serious in the US with nailing these gangsters. In the Netherlands such crooks get a proforma sentence or a few days of community service, and often claim millions in damages after their trial because their reputation/career has been damaged. I hope he sets a nice example for all the other financial gangsters. Still hoping for some webcams on WallStreet to broadcast the popcorn when the heat is turned on there
It’s the same old song……….same old song and dance my friend:
The bank, once labeled as one of America’s most profitable small banks, paid high rates of interest to attract deposits, then turned around and issued more than 500,000 credit cards to credit-challenged borrowers. As losses mounted, Mattar and fellow defendants hid the numbers from regulators while receiving performance bonuses.
Sounds like FANNIE MAE/ ENRON/ CITIBANK/ MERRILL et al.
“…fellow defendants hid the numbers from regulators while receiving performance bonuses.”
Hey Crispy,
Still no “evidence” of fraud for the DA in Bakersfried?
Damn, must be a real moral city filled with law abiding “professionals”
Had a few drinks with friends the other night, one guy is really a good, honest, hardworking realtor. Always “Mr. Positive”, he spent the last year saying how lucky we are to be in Upstate South Carolina because we were not having the housing problems many of the other areas were having. After about 5 bourbon & cokes, he dissuaded any of us from spending money on unnecessary home improvements in our houses, as “we won’t get the money back” if we sell. He said over $400K is deader than dead, and now the under $400K market has gone cold too.
Also, a Clemson U grad told me that “my man” Ron Paul had about 2,000 at his campus rally there yesterday. Our local newspaper reported that about 500 “Paul die-hards” turned out. Who is not telling the truth?
The paper didn’t lie, they just presented the story the way they wanted you to read it. They estimated that of the 2000 people who turned out, 25% were “die-hards”. Therefore, their best guess was 500 die-hards were there.
You, of course, read the story the way they wanted you to read it, that 500 persons actually showed up.
My best guess at the “discrepancy”.
It’s a lot like the Million Man march with 200,000 unemployed losers.
Well traditional wisdom has always been that it’s a fools game to spend money of home improvements in an attempt to boost selling value except for 1.) minor cosmetics like paint and yard work. and 2.) major rehabs of distressed property that leverage alot of sweat equity. You should spend money on home improvements because YOU will receive sufficient enjoyment from them before you sell, not because you think somebody else will like your taste sufficientyl to pay for it.
Canadians see deflation in US travel. Eyewitness in Western NY.
30 to 40 % of the cars parked at the Buffalo airport have Ontario plates. Ticket counters are opening at 4:30 AM to handle the extra traffic.
This is good news for Western New York. They need the business and the cash flow, and the Canadians will get good value for their money. Without the Canadian taxes and tariff costs, anything you can buy at retail in the US is a good deal for Canadians.
Thats for sure. Cars in the U.S. are thousands cheaper than here.So is just about everything else, from books to electronics to clothing. Even though the C$ is now 1.07 U.S. you wouldn’t know it. Retailers here are still pricing at 75 cents cdn. to the greenback. I stopped shopping in Canada altogether.
USA has become a cheap destination for foreigners, like Mexico or Cuba. Will we be selling black market body parts to Canadians soon?
The government here already functions like a banana republic, completely ignoring all the problems of the people while paying lip service to enforcement of our laws.
So, we might as well become a banana republic we’ve worked so hard at becoming. Thanks George Bush. You make Jimmy Carter look like a genius.
The funny thing is that foreigners come to the US to buy Made in China.
I saw a friend of mine who lives in Hong Kong last summer in P’cola and he loaded up on a number of clothing items while he was in town. I couldn’t believe it because all the stuff is made in his backyard. He said the sh!t was cheaper in the States.
Everyone I know traveling on their own dime from Toronto in the next few months is leaving through Buffalo. Saves 25-60% on airfare.
We head down to the Buffalo area once every 6 weeks or so to stock up on staples and bigger-ticket items. We save 30% easily, well worth the $20 in gas it costs, and we’ve never paid duty and we always declare everything. Every night the news has some “expose” on how expensive identical goods are in Canada vs. the US.
Many stores are advertising deflating prices in Canada. Car companies are laying off a few thousand people in Southern Ontario. Canada thinks it’s immune to the US recession, but it’s looking like it might fall even harder.
“stock up on staples and bigger-ticket items.”
You cross the border for staples? Make sure you grab some pencils and scotch tape while you’re here.. Lol.
No joke that…check out the difference in price on a can of Campbell’s soup sometime, and you’ll see what AK-LA is talking about. Shampoo, soap,toothpaste…prices are close to double in Canada for brand names.
My GF thinks the rising $CAD is pretty good stuff and talks often that Canadian prices should come down. She gave me a really strange look when I suggested that in order for prices to come down, wages would have to come down too.
“Canada will be fine.”
In honor of you, the fresh ex-Prince of the Largest Bank in perhaps all the World…
I was dreamin’ when I wrote this
Forgive me if it goes astray
But when I woke up this mornin’
Coulda sworn it was judgment day
The lies were all purposeful
There will be bank runs, everywhere
Tryin’ 2 run from financial destruction
U know you didn’t even care
‘Cuz they say two thousand zero zero seven party over
Oops out of time
So tonight you’re gonna party, and blame it all on Sub-Prime
I was dreamin’ when I wrote this
So sue me if I go 2 fast
But life is just a party
And parties weren’t meant 2 last
War is all around us
My mind says prepare 2 fight
Yeah, they say two thousand zero zero seven party over
Oops out of time
So tonight Prince is gonna party on Citibank’s Dime
Yeah
Dutch housing bubble update:
just like in the seventies when the previous Dutch housing bubble was raging (tiny bubble compared to the current one), squatters (’krakers’ in Dutch) are back in the streets and on the news. Just like 30 years ago, many people can’t afford a home while whole blocks of homes stay empty because that is the easiest way to make money with housing in the Netherlands. And just like then, government does everything they can to protect the big housing speculators (often politicians and their rich friends). The situation is not as tense as in the past, when tanks and paramilitary forces were rolling through the streets of Amsterdam to protect the RE mob from angry citizens, but we might get there again soon.
The government is considering to make all squatting illegal again (it is legal in many cities under certain conditions, e.g. when a home has been empty for more than a year). Some rightwing politicians are calling the krakers terrorists and have proposed to use the new EU anti-terrorism laws (similar to US Homeland Security) to stop the squatters. Of course, if you want affordable housing in the Netherlands you are a terrorist, no doubt about that as the whole purpose of this country seems to be expanding the housing bubble.
The newspaper today also had a story about one century of homebuilding in the Netherlands, mostly about the reasons why production is declining while demand is high (all people involved make more money when there is a shortage, and the terrible Dutch burocracy and building regulations do not help either). The story gives some historic values for monthly rent for a simple Dutch worker home (writing down from memory, maybe with some minor errors, converted to current euro currency):
1905: EUR 10,-
1935: EUR 8,-
1970: EUR 40,-
1990: EUR 200,-
2007: EUR 600,-
actually the last two numbers should be (much) higher, because these are highly subsidized rents now.
And the corresponding salaries are?
it’s not a closed system, folks.
I listed the numbers most of all to show rental price inflation (not as bad as home price inflation in Netherlands, which is several times higher over the last 17 years).
of course the salaries are important, but it’s not so easy to find them and compare (because of huge shifts in tax rates, deductions, shift to double-income households etc.). Current gross median wage in Netherlands is 30K euro and tax rate is 42-50%; after tax (the only number that matters for renters) there is at most 1600 euro monthly income left. Paying the real +/- EUR 1000 monthly rent for a standard working home would be a problem, and so we have huge renter subsidies (only for certain ‘disadvantaged’ citizens of course, but there is enough subsidy going around to make sure the rental market is NOT working).
Coastal Maine–For Sale
http://tinyurl.com/3bcqg5
My husband and I toured this place, which used to be a nature preserve, about two years ago, when it launched. I was horrified that the state, county, or some environmental group had failed to buy and preserve it. But they did not. The developers envisioned this as an extremely upscale summer colony of $1M+ houses and they seemed to be doing a quality job on the infrastructure with a big substantive dock, buried power lines, and much common acreage conserved. Looks like they have failed to sell most of the lots and are now throwing in the towel. BTW John Travolta does have a house in Maine, but on Isleboro, not here. Which is sort of like peddling a house in Ventura with the promise that you could “Live near Oprah!”
From the St. Paul Pioneer Press:
http://www.twincities.com
“One of the most definitive voices on the Twin Cities new-home market scolded builders Thursday for constructing still more houses when there’s a damaging oversupply.
“There’s a few idiots out there still building specs,” said Betty Hardle. “They must have a death wish.”
Hardle was addressing a group of builders and developers Thursday in St. Paul at a seminar sponsored by the Felhaber Larson Fenlon & Vogt law firm. Hardle, who recently sold her Residential Research Services Co. to Hudson, Wis.-based MarketGraphics Twin Cities Metro, told the group she doesn’t see the bleak market for new homes turning around until “sometime next year.” She instructed developers to hunker down for a hard winter.
“If you’re a developer, you might think about working at Target over the holiday season,” she told the crowd.
Derrick and others agreed land prices still haven’t come down, despite that many counties are overloaded with developed vacant lots.”
Go to defcon 3! We got death threats!
“Meredith Whitney, the analyst who prompted a $369 billion (£177 billion) plunge in the value of US shares on Thursday by issuing a negative note on Citigroup, hit out at Wall Street’s culture of intimidation yesterday after receiving several death threats from investors in the bank.”
Times Online
http://tinyurl.com/2lezku
This story seems OT, until you get to the end:
http://www.sacbee.com/101/story/469562.html
“Melikian told the jury in his closing argument that Dharni was financially desperate and stood to gain $250,000 by eliminating a third mortgage on his home if the restaurant was totally destroyed.”
“Willing to work on the cheap, Duran agreed to do the arson in exchange for Dharni bringing him current on his mortgage payments – approximately $1,500.”
And they are both meth-heads. I wouldn’t lend a meth-head $10, let alone $250,000. I guess as long as the broker got his commission…
For anyone who is thinking about buying a house in the next few years, and plans to keep this house for 20 years or more; here are some things to consider when choosing a location.
Global Warming is happpening, and its happening faster than even the most shrill alarmists had predicted. Its quite likely that all of the ice caps will be melted in 20 years with a 20 foot rise in sea level. Some of the MSM have talked about a 1 or 2 foor rise in sea level; but they are only telling the best case scenario. So what does this mean for a potential homebuyer. Dont buy a house less than 40 feet above sea level or within 1/2 mile of locations less than 25 feet above sea level. Since local governments are going to be paying a huge cost for sea walls, flood control, victim relocation etc…; you probably want to avoid any state that borders the ocean. Certainly all of south Florida is going to be underwater.
Another consideration is a stable water supply. Phoenix gets its incremental water piped 1700 ft uphill from the oversibscribed Colorado River. in an era with energy has increasing costs and less reliabilty, you dont want to be somewhere where water can be so tenuous. I would personally avoid Arizona, Vegas, and Southern California just because of the water concerns.
Peak oil is real and it has allready happened. Every year the US is going to somehow learn to live with 10% less petroleum. Its not a matter of spending more money; the oil is simply not there for any price. There will be temporary supply disruptions in the next few years where there simply is no gas available. This suggests you want to choose a community where you could go for a few days or weeks without using a car. Along with shortages, there is likely to be a major spike in crime. This implies it would be good to live somewhere with less crime, perhaps a smaller town or rural area.
Phurther Problems Phor Phoenix…
The dreaded Quagga Mussel showed up all over the Colorado River system this past January. It loves intake pipes…
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2007/01/20/MNG96NM0A71.DTL
well … that would seal the fate of the Dutch housing bubble, as only a small percentage of the whole country (and an even smaller percentage of the homes) is more than 40 ft above sea level.
I share your concerns about global warming and flooding (and also risk of severe drought because most of the gletschers that feed our rivers in Europe will disappear in about 25 years). But I have not seen any credible reports that predict a 20 foot rise in sea level, not even in 200 years. Scientist in my country (who are more concerned than the government itself) are expecting a 1-2 feet rise in the next 20-50 years; a few are talking about 2-5 feet in one or two centuries. A rise of that magnitude can be handled with existing technology, although the cost would be huge. With a 20 feet rise in sea level the whole country (and probably many big EU cities) would have to be abandoned, because then you cannot built dikes high enough to keep the sea out (the water would simply leak in from under the dikes).
Obviously, an unexpected Peak Oil scenario would be the best cure for global warming, although with some delay
Another world war (GWB is working on it) could result in some additional cooling because of all the dust particles in the atmosphere ;-(
David,
You need to spend less time with NPR.
They world is not melting down. There are areas re-icing where other areas are melting down. The entire globe is warmer by about 1/2 degree than some 100 years ago.
I am waiting for the water to rise as my canal is silted up and makes getting in and out difficult at low tide.
I have been waiting for 8 years for a good 1 foot rise, but, no luck.
Hopefully, the “global warming” will fix all this, and i can count on 2 foot rise in the water level. That will make access much better.
I’m not worried about the global warming crowd. I fear Al Sore far more than climate change. World peak oil is not a theory though. It’s a fact that we will see. It’s going to force us to change our lifestyles, not the “global warming” baloney. We will never run out of oil. We will run out of inexpensive oil. http://www.theoildrum.com
“…with a 20 foot rise in sea level [in 20 years]“.
david,
POLLUTION — of air, sea and land — is very real.
OVERFISHING of the oceans, to the point of predicable irreversible depletion, is real.
OVERPOPULATION, probably to the tune of 5 or 10 times the carrying capacity of the planet, is all to real.
PEAK OIL, and PEAK WATER are geological facts.
while all of the above are quite verifiably true statements, your preposterously anticipated rise in sea level is, nonetheless, complete nonsense!
and for my reasons stated above, i think you’ll agree i’m in the 99th percentile of doomers and could hardly be accused being unreasonably optimistic about a rosy future.
i simply think that the anthropogenic global warming model is just that — a fatally flawed computer model that has more to do with politically correct manipulation than good science.
in fact, the best science i have read tells me that we are entering a longterm cooling period, and that the prospect of rising sea levels is, at best, misguided, if not entirely bogus.
but, if it’s any consolation to you, i’d agree that any way you look at it, we are all f*&*^d!
longterm cooling period: yes, probably starting in a thousand years or so; won’t help you very much. It is not clever to talk about worldwide cooling if readily observable facts directly contradicts the hypothesis. Human caused global warming is a fact that cannot be denied anymore and yes, I’m a scientist and consider myself well informed on the subject.
Of course, what percentage of the warming is caused by humans, and how much sea levels will rise in the long run due to global warming cannot be told exactly by the models because there are too many unknown factors, and new ones are found every year (or month). But melting of most of the North Pole ice seems a pretty sure bet for the next 20 years or so, and that alone is enough to get 1-2 feet higher see levels.
P.S.: one of the scientists that constantly says in the media that global warming is bogus and that we are entering the Big Freeze comes from my country. He is a geologist (not a climate expert) working for Shell, one of the companies that denies global warming for obvious reasons; they also deny Peak Oil.
i don’t deny there’s been some warming, and i wouldn’t doubt there’s been SOME human component.
i do question whether ‘climate change’ as such makes any sense to prioritize as the major problem facing humanity given the extent of the other problems i’ve mentioned, all of which seem to both be out of sight of the environmental lobby and predictably unresponsive to a lowering carbon emissions. and any way you slice it, i see no indication whatsoever that we are about to reduce carbon emissions. as the world reverts more and more to coal, emissions are are likely to increase substantially.
whatever the problems, nuclear war may well be the ’solution.’
Well regardless its too hot for me here in Phoenix so my long term plans are to move up in elevation and near mountains with snow on them. But right now its going to be nice weather in Phoenix for 4 months so I’ll take it.
Long term I don’t know maybe Colorado ? Eastern Oregon , idaho ? Good to be a renter right now
Cactus, I’d prefer being back home in Arizona this time of year. If you had a home business and with very few material possessions, you could live in Flagstaff from May through October in a rental, then in Phoenix the other months, also in a rental. Just do 6 month leases.
I agree that the above quoted sea level rise is way overstated.
But I have to take issue with your statement,”i simply think that the anthropogenic global warming model is just that — a fatally flawed computer model that has more to do with politically correct manipulation than good science.”
I don’t agree with you there. You could say “the anthropogenic global warming model is just that — a predictive model”, but can you really tell us how it’s “fatally flawed”? Do you disagree with the initial parameters/assumptions? Or do you take issue with one of the IPCC models in particular? If so, which one and why? Is it the issue of the water vapor not being included among GHGs? The drought in the US as counter-evidence (it’s global climate change, not US climate change)? Are you swayed by K.I. Abdusamatov’s claims that solar isolation is behind warming (which is demonstrably false when you look at cosmogenic isotopes)? Or is it Svendsmark’s unpublished (i.e. non-peer reviewed) rebuttal to Lockwood and Frolich?
And just because the model is being promulgated by Al Gore doesn’t make it wrong. That’s a specious argument. Perhaps we could both re-read the 6th IPCC report and take this discussion off-line?
I hope that I’m not coming across as a d*ck, but this gainsaying of climate change (”global warming” is not the preferred nomenclature) on this board by non-experts who often cite the Heritage Foundation and obscure Russians (whose evidence contradicts Fourier’s law of heat conduction) as their evidence rankles me. That and people who use the word “b*tch” when referring to women, and “neighborhoods infested with immigrants” as though they are cockroaches. That’s pretty bad too.
MrBubble
If all the snow in the polar ice caps melted the sea level would rise 20ft. The arctic sea ice is melting much faster than the most pessimistic models predicted. The amount and rate of carbon emissions is going up, the earth can only get hotter from her. As the ice caps melt it tends to accelerate the warming. The argument that the sea level will only rise 2 feet is based on glaciers more rapidly flowing into the sea. But if we reach a tipping point such that the earth warms 4deg C, all the ice caps could melt in 20 or 50 years. We dont know when it will happen, but this is the sea level rise when it does melt. If you are skeptical, and like living in a low lying area, you are taking a risk. Maybe there will be time in 10 years to see whats happening and change your mind. I plan to find a house and a community I can live in for the next 30 years, and i want to be ready for the flooding; not one of the billions of refugees.
I find it painful that environmentalists obsess about things like using plastic bags in the supermarket (maybe 10 gms of CO2), and then fly to Europe, (1,000 kgs of CO2). There are 3 power sources that could really make a difference in carbon emissions on a big scale, hydro, nuclear, and LNG; and the sierra club is dead set against all three.
If the organizations that supossedly really care about global warming are fighting against the tools that can help us, i think we are really screwed as a race.
I’d just add that it’s only the ice that’s on land that would make a difference in sea level. Strangely, a large part of sea level rise is the water itself expanding as it gets warmer.
Also, I think that the small things can make a difference as long as someone who recycles a bottle and then flies to Europe doesn’t get all self-righteous about it and drives people away from conserving. We shouldn’t say, “Eff it, I’m flying to Europe so I’m getting extra packaging, a plastic bag, throwing my trash out the window and choking a baby seal!”
Just try to cut back everywhere that’s easy for a start and see what happens. Lowered my electricity/gas bill last month to $39 with a few simple things, but I flew to WY from CA for work. Then again I did get a deer, so I have my hormone free, non-corn fed meat for the year and the freezer would be on anyway.
I think that hydro is done in the US and we’ve got the same GHG emission problem with LNG. Nukes for baseload (and further fossil fuel independence) and a massive, I mean MASSIVE attenuation in frivolous consumption. Decoupling of profits and sales for the energy companies would be a first start. Also, nice to see a big wind farm near Sidney, NE casting shadows on the enormous coal trains.
I’ve spent a good part of the day trying to determine whether it’s better to use a hand dryer or two towels when you go to the can. So this stuff has been on my mind. Conclusion: use a hankie.
what a pompous a$$wipe you are! i suggest you take that hand dryer and SIUYA!
Some of the Great Lakes have been seeing below average water levels for the last 10 years or so. And these records go back to at least 1860, among the oldest of American lake level records.
“Global Warming is happpening,…”
Green political fear mongering is happening.
naive extrapolation.
I am interested in science too. Unfortunately this is an interest not shared by some who make their living from predictions.
Thermal expansion, oh my! Ice has a higher volume than liquid water, so melting the caps should lower sea level, LOL. If the planet warms, the rock will warm with the ocean. Rock is deeper than the oceans, so the land will rise more, LOL. All that creaking and cracking will result in some huge volcanic erruptions, sending up clouds of dust that will freeze our @ss, problem solved.
“Of course, what percentage of the warming is caused by humans…”
nhz,
as unbiased research proceeds, it may well be proved that much of the ocean warming is the result of undersea volcanic activity, where 6/7ths of the planet’s volcanoes are to be found.
Comment by Professor Bear
2007-11-03 07:41:32
“look at the analysts that do this for a living…’
‘It strikes me as most amazing that a ragtag bunch of bloggers, some of whom wear tinfoil hats at time, have collectively left a cadre of highly paid Wall Street analysts in the dust.’
Will you stop with the ‘rag-tag’! Speak for yourself, my good professor; what, are you wearing a roll of garden twine or something?
And there is nothing wrong with tinfoil headgear. An underutilized couture material. In fact, I believe I will fashion myself tinfoil headgear this weekend, and it shall be a miracle of beauty. I will send a photo to Ben when I’m done.
I do agree with you that the bloggers have left the idjit Wall street analysts in the dust, coughing bewilderedly.
I think I’m going to start selling tin foil hats on eBay. Full page ad in today’s paper says eBay sellers make $10K a month.
“‘It strikes me as most amazing that a ragtag bunch of bloggers, some of whom wear tinfoil hats at time, have collectively left a cadre of highly paid Wall Street analysts in the dust.’”
your answer is in your question: we can afford to be right. highly paid analysts cannot.
http://www.larouchepub.com/pr/2007/071021asians_dollar.html
Asians Dumping Dollars as Crash Proceeds.
Can Larouchees’ analysis be trusted?
http://www.larouchepub.com/eiw/public/2007/2007_40-49/2007-41/pdf/15-17_740.pdf
[Warning - PDF!]
Loudouon Country housing bubble imploding on residents, local government.
Many here are negative on financial stocks and I tend to agree for obvious reasons. Check your mutual funds for financial stock weightings out of proportion to the S&P which I think is about 20%.
Mutual funds with names like Value or dividend may tend to have higher numbers and amounts of bank stocks. This isn’t meant as financial advice just a cautionary note in case you are worried about this sort of thing. I sold out of a Value fund with 36% financials and no it has not done too good this year, almost missed it until I checked its holdings. Du-oh.