There’s No Fear Anymore Of Being Insulting In California
The Voice of San Diego. “With homes taking longer to sell, and buyers choosing between more homes on the market than just about ever, real estate agents are getting pickier over the clients they’ll take. ‘If you’ve driven somebody around for two or three days, six to eight hours of driving around in a day, and then they decide ‘Oh, I actually don’t want to buy,’ I don’t know — how does that agent make a living?’ said Sharon Crown, a Coronado-based real estate broker.”
“‘You know, these listings, it does cost money to carry them, to advertise them, to work on them,’ said broker Jim Abbott. ‘And the huge, vast majority of them are not going to sell.’”
“Emotion plays out most dramatically for sellers stubbornly married to a lofty price, said broker Adam Rappoport. ‘The common line you always hear is, ‘We think someone will fall in love with this house like we did,’ and pay the price we’re asking,’ he said. ‘That doesn’t happen anymore….In this day and age, at least most Realtors are trying to portray a more accurate view of the market, and sellers are still in denial.’”
“The buyers approaching agents these days are increasingly aware of the market conditions, Rappoport said. ‘What I have now is … a different class of buyer,’ he said. ‘It’s a very savvy group of very smart, intelligent buyers who know the market. They have me write up offers 10 to 20 percent below list. There’s no fear anymore of being insulting to the seller or the lender.’”
“Abbott said he and his colleagues typically spend between $1,500 and $6,000 to market a property. But if the price on that glossy flier makes a buyer laugh out loud? ‘If a listing is overpriced and you never sell it, then you’re just out that money,’ he said.”
“Ron Alpert, (who) coaches real estate agents around North America (said), ‘If you’re overpriced, people are going to look at it, and they’re not going to call. Maybe the market would firm up a little bit if all of these sellers in dreamy-dreamy land would just take their houses off the market.’”
The Times Delta. “Patricia Romer doesn’t remember exactly what the sign said. But it promised that a housing development would rise in a vacant lot near her east Visalia home by fall 2006. It didn’t happen. The lot, a former orchard cleared of trees sometime last year, remains vacant. And the sign, which fell down in January, is gone.”
“Meanwhile, Romer said, the lot has become an eyesore. ‘It was just a terrible mess,’ she said. ‘And [at one point] there were people sleeping in it.”
“Fed up, Romer called the property’s owner around January. She was told the project was delayed and would be completed by spring. It wasn’t. ‘So I said I’m tired fooling with these people,’ Romer said.”
“In August, she called Visalia’s Code Enforcement Division, hoping the city could put pressure on the developer to get something done. The city’s subsequent clean-up efforts improved the situation, she said. But the houses remain on the risers and trailer, which Romer said degrades the neighborhood and affects home prices.”
“‘There’s only so much people can be coerced to do,’ said Tim Burns, city of Visalia neighborhood preservation, code-enforcement manager. And still unresolved: the $632 the developer owes the city for its cleanup efforts.”
“The contractor, Ridgecrest Homes of Stockton, plans to build 149 single-family homes on a 40-acre site, according to Jake Jacobsen, vice president of operations. The subdivision is to be called Eagle Meadow, but the nationwide housing slump has forced the company to scale back its marketing of the homes, Jacobsen said.”
“Ridgecrest has pushed back the construction start date to summer 2008. The houses are no closer to being built, however. No construction permit has been issued.”
The Mercury News. “After years of planning, San Jose is joining the bandwagon of American cities that offer an urban lifestyle for those who are tired of commuting and yearn to walk to work - or at least to a train station.”
“While developers would have picked a more auspicious time to hit the market if they could have, it’s tough to time it right when these towers can take five years or more to plan, design and build.”
“‘The headlines are certainly bad for single-family residential homes in outlying markets,’ said Seth Bland, a partner with Wilson Meany Sullivan, which along with CIM Group is building The 88, scheduled to open in mid-2008. ‘But those headlines do not apply to our buyers. The 88 is a new lifestyle option.’”
“Matt Anderson, a partner in an economics and real estate research firm in Oakland, hedged his bets. It’s a tough call, he said, in a city that has never offered this product.”
“‘I wouldn’t call it a slam-dunk in today’s market. The stock market is unsettled. The economy is doing well, but it’s not an outright boom,’ he said. ‘The big question is whether they hit the demographic the right way. Affordability is not really an issue.’”
“For those who worry the market could be flooded, as were those in Miami, Las Vegas and San Diego, John Weis, of the city’s redevelopment agency, said the market in Northern California is so underserved that San Francisco is planning more than 8,000 units for the area stretching from the Mission District to the Bay Bridge.”
“In San Jose, along with the almost 900 units in four high-rise projects either on the market or about to be, 12 more towers with 3,700 units are in the pipeline. ‘San Jose has a total of 4,500 units coming to market over a five-year period where two years ago, we had none,’ Weis noted. ‘No, I don’t think we’re overbuilt.’”
The Contra Costa Times. “Erica Baez once figured she had a great gig in the mortgage business. ‘I kind of fell into this,’ said Baez, a Hayward resident who entered the mortgage business in 1995, soon after she graduated from high school. ‘I realized it could be a way to make a lot of money.’”
“The housing crash has erased all that for Baez and many other workers in the industry. In the East Bay in the past year, the home sales and financing quagmire has sucked into oblivion 8,100 jobs in construction, real estate and mortgage activities.”
“‘Everybody is losing their job,’ Baez said. ‘It’s really stressful. A lot of people are going through this.’”
“In more than a few cases, these workers are discovering that their skills do not always transfer readily to new industries. Many in the industry have been forced to scramble for work. Some must ponder whether to return to college to pick up skills for a new career, all while hunting for work or starting a new job.”
“Baez was out of work for a few weeks. She found a job in customer service for a wholesale manufacturer. Her pay plunged 32 percent, from $55,000 a year in the mortgage industry.”
“‘I expect I will have to take a job at Starbucks or something like that at minimum wage,’ Baez said by e-mail.”
“In 2005, Sabrina Wilson, a Hayward resident, made $110,000 in the home-financing business. Like others, she jumped into the working world right out of high school. Before getting into financial services, Wilson had jobs in retail and fast food.”
“Before long, Wilson found a job handling mortgages, and she never looked back, until this year. She loved the jobs she held in the mortgage industry, but she has never witnessed a meltdown so complete as what is going on in 2007.”
“‘I have seen ups and downs, but I have never seen it like this,’ Wilson said. ‘Companies are shutting down. I know loan officers who made $1 million a year, and now they are out of the business.’”
From ABC30.com. “Falling stocks, the mortgage mess and rising oil costs, a combination that has experts warning that a recession is more than a possibility. Economists in the Bay Area are looking into a crystal ball that looks a bit scary.”
“A recession is a bitter pill to swallow, and the Bay Area Council isn’t trying to sugar coat it. The council’s new economic analysis says a recession is almost certain.”
“The housing market is playing a big role, but that’s only part of a complex economic picture. ‘We think a recession is in the offing here,’ said Bay Area Council and CEO Jim Wunderman.”
“And its latest survey is reflecting the most pessimism since the dot com bust seven years ago and it’s tied to the fall in Bay Area home prices. ‘Overall, people are feeling a sense of malaise and dread, and that tends to have impacts in the way people behave, including spending, hiring, and once that happens, you’re in for a pretty strong downward cycle,’ said Wunderman.”
“‘Many people have not gone through a bump in the road, so it’s a new experience for them. Old times like me have, and what you learn is, you hope for the best and plan for the worst,’ said real estate developer Jon Reynolds.”
“Perhaps the most sobering figure mentioned in its report today is that Bay Area home prices could fall 25 to 30 percent.”
The San Francisco Chronicle. “A real estate symposium on Monday - featuring panels titled ‘catastrophic risk,’ ’subprime crisis’ and ‘economy on the edge,’ among others - predicted more gloom in the Bay Area housing market over the next year or so.”
“‘Housing has not really hit the bottom … and we’re not going to hit the bottom for a while yet,’ said Jim Wunderman, CEO of the Bay Area Council.”
“Economist Ken Rosen, a notorious bear on housing who has called for a correction for several years, said home prices in the urban core of the Bay Area could drop 5 to 10 percent - but outlying areas could see tumbles of more than 20 percent.”
“In other regions, such as economically depressed Detroit, or Las Vegas - the land of speculative building - the damage could be far worse next year and beyond. ‘Las Vegas is finally deflating,’ Rosen said. ‘You had all these massage therapists who bought speculative homes that are now losing money.’”
“The Bay Area’s Wunderman is already seeing an effect on his constituents. Survey results show that business leaders in the area are less confident now than at any time in the last several years, and many say the housing downturn will push them to cut hiring plans.”
“Builders say the anemic market is effectively bringing the value of certain ‘C-level’ building sites to $0, while costs for labor and materials - which spiraled higher as prices rose - have not come down.”
“In order to survive to build another day, some builders may be forced to sell off valuable inner core land, shut down unprofitable divisions or merge with larger firms.”
“Michael Ghielmetti, president of Signature Properties of Pleasanton, predicted the market would begin to spring back in 2009. ‘There’s a perfect storm working against us,’ Ghielmetti said.”
Here is Rich Toscano’s latest on San Diego.
“As the next graph indicates, this process has now gone into reverse. The low-tier home price index has fallen 13.3 percent from its June 2006 peak, while the high-tier index is down a comparitively mild 5.8 percent since its peak that same month.”
Let’s say the average SD home under $482K was $410K in value, while the average SD home over $679K was $920K in value (just guesses for illustration purposes).
13.3% X $410,000 = $54,500
5.8% X $920,000 = $53,000
Conclusions:
1) The magnitude of loss may be roughly comparable at different price points, even if the percentage drop is greater at the low end.
2) This is consistent with a market where investers cashing out are the marginal sellers at various price points.
3) It is comforting to see that investers at all price points have taken a bath.
4) The relatively larger drop at the low end likely reflects the absence of subprime loans. With Jumbo elephant loans on the endangered list and lots of vacant never-lived-in McMansions in San Diego’s 131 “New Home Communities” steadily depreciating in value, I anticipate relatively larger drops at the high end going forward.
I thought you were talking about reverse mortgages. This is how the government will hand money to people. (recently some magazine was selling sheets of 4 uncut dollar bills for much less than the face value of the bills — this is how you will be handed cash - just provide your own scissors!)
What is this reverse mortgage, sounds kind of fishy of course:
http://finance.yahoo.com/focus-retirement/article/103906/Reverse-Mortgages-The-Choices-Expand?mod=retirement-post-spending
There is so much going on today I ran out of popcorn.
Got Popcorn?
I absolutely LOVE the fact that the rose-colored glasses crowd is now at the “Recovery in 2009″ mantra. It’s been less than two months from the “Recovery in 2008″ slogan and less than four months from the “Recovery in late 2007″ bull.
When realtors and builders and brokers and lenders are all saying 2009, you can see acceptance starting to set in. Of course, we still have the anger and denial evidenced in the “Maybe the market would firm up a little bit if all of these sellers in dreamy-dreamy land would just take their houses off the market.” quotes still coming out. But still. Ouch.
Recovery in 2015! Woot!
I’m thinking recovery in 2012. Maybe flat from 2010 from 2012, since all those option ARMs due to reset by 2012 will likely be tripped early.
I think we need to define what recovery is. Is it when we get to the point where housing is increasing in value at approx. the rate of inflation (whatever the heck that REALLY is) plus maybe 1% or 2%.
Or is it when prices are totally flat??
Or maybe it’s when prices start going up 10% or more again per year?? I think if you poll most people, it’s when prices are going up like they were a few years ago.
When I say “recovery”, I just mean that prices will start going up again in a normal way (close to inflation). I don’t think we’ll see bubble prices again in this lifetime.
I agree with big V.
Recovery in 2012 proceeded by a flat line. I also believe the option ARMs will trip very early (2008/2009).
Got popcorn?
Neil
Everyone fails to mention the “flatline” factor. You hear these guys saying housing will “bounce back” in late ‘08, or in ‘09, and you just know the koolaid drinkers are thinking off to the moon again. Sorry chumps, it just don’t work that way.
So it sounds like bottom in 2010, flatline for a couple of years, then uptrend in 2012, right?
The same type of people were forecasting a “V”-shaped recovery following the stock market crash in 2000. There were a very few contrarians then that said that an “L”-shaped “recovery” (decline followed by a long flat period) was more likely. Priced in a stable (non-USD) currency, we know who was right.
Similar to 2000, those that are actually basing a forecast on data are forecasting a flat period after the decline, this time for housing.
I say long-term decline with NO recovery, at least not the recovery these realtor clowns are looking for. Nope, not for another generation - not until we have a whole new crew of “Masters of the Universe” who will apply their own absurd models to create a new Ponzi scheme based on housing.
Housing has so many things working against it right now:
- The psycological factor of the current decline. People are slowly learning that real estate does NOT always go up. Once they get burned or crushed and either lose their own homes or get to see friends losing their homes, they won’t want to touch real estate investment again. That conditioning will not go away until the current crisis is far enough in the past that a new generation who did not experience it is running the show.
- Banks are afraid. They have taken massive losses that are only a small amount of the stunning losses they will be seeing in the future. While the Bubble provided plenty of cash and fees, I think it’ll be a long time before the big players decide to again give absurd amounts of money to people with no ability or intention of paying it back. Same idea with the current failed “securitization” asset-backed security model - another failure that won’t be coming back soon.
- Wages are declining. Jobs are leaving the country or being insourced with illegals. We can’t support miles of McMansions on $10 a hour, no benefits, almost-part-time service sector jobs.
- Inflation is rising. Ties into the above; with the dollar being trashed and the price of energy sky-rocketing, how are the minimum wage earners (the soon to be future of most of this nation) going to afford a “start townhouse priced only in the low $400’s?”
- Demographics: the Baby Boomers will eventually retire, downsize, and die. The generation after them is not large enough to fill up all the houses and probably will be much poorer after the Boomers are done robbing us, so there won’t be much use for second homes, either. Barring a massive influx and legalization of the illegals, demographics are against the “not enough houses” argument. And if they did legalize the illegals, quality of life would plummet in this areas, which also decreases property values.
Just my thoughts on the matter, but I really think this Bubble, at least in real estate, will not be seen again by anyone alive at this time, save for the children who are too young to understand the problems that caused the current Bubble.
There will be no recovery until 2017 - at least - for those who bought at peak.
When they say RE will never recover then I know its time to buy a house.
Palmetto said:
So it sounds like bottom in 2010, flatline for a couple of years, then uptrend in 2012, right?
Yep. Everyone will have a long time to shop at your leisure.
And as Crisrose notes… We’ll see peak prices again, but it won’t be for a LONG time… I agree with 2017.
Got popcorn?
Neil
Bubbles repeat when a majority forgot about the pain. The latter won’t happen within the next 15-20 years.
Ha! The public completely forgot about the early 90’s price drop by 2000. They’ll remember for _maybe_ five years.
It’s a eight year cycle but the players have a five year memory.
I don’t think this bust will be forgotten within the lifetime of those who suffered. Comparisons to the 1990’s price drop are not appropriate, this one will be so much more catastrophic. See tomorrow’s posts where the demise of Levitt (remember Levittowns) is reported. Emblematic of a really unprecedented problem. Persons in their 20s-30s now must die before this kind of housing mania will be repeated.
Why can’t I see this negative pschology working in Los Angeles? Where we see cars and big homes everywhere owned by everyone? Look at some of the listings in Zip Realty….prices have barely come down. Would you consider a 1000 sqft POS place in Pasadena going for $650K a good price? I certainly don’t…so what gives? Let’s not say it takes time….I think things are in full swing now.
There are lot of people with ALOT of money here….many of whom have enough money to probably ride out 2, even 3 housing bubbles like this.
Believe, I’m the first to say I hope all this goes to hell and people get burned BAD….I have no remorse…but I sometimes wonder if I should just stop wasting my life and pack my bags and leave.
I agree, Big V. In the 90s, prices continued to drop for about five years, and then were stagnant for two years before rising again in 1998.
What makes you think there will ever be recovery at all?
Ah, what an interesting question. I’ve mulled this over myself and can only come up with the conclusion that just about everyone (myself certainly included) is using past cyclical experiences to predict the future. But, and humor me for a second, what if the future takes a path that doesn’t resemble any commonly cited past event? (ex. 1893, 1907, Great Depression, 1970s, 1982, 1991, etc.) What if?
Otherwise I agree with the Pondering on two points…
1. this might get so bad that RE is abhorred for an entire generation
2. downward pressure on real wages will continue unabated and wages will not support the housing costs of this past decade - not to mention future commuting costs and HVAC/electricity costs and (most importantly) taxes
So no, the this bursting bubble might not merely be a good time to buy RE “on the dip” - it might be something altogether different - something that no one can predict.
impressions from 1950 (I was 3): people were cautious, guarded. I now believe that the depression had made them so, they didn’t just remember, they knew. My mother and father knew, it affected how they acted, what they bought and that they never borrowed - except for a mortgage. Take 1940 as the end of the depression, it has taken 3 generations to forget it. It looks like we’re due for a refresher course.
God bless America!
I’ve wondered the same thing on both of your main points.
1. Will it get sufficiently bad that real estate is viewed differently than it has been in the past 50 years forcing fundamental changes?
2. Are other factors occurring that will impact far more than housing (climate impacts from global warming, peak oil, downward pressure on wages from globalization, e.g.)?
Either of the above would probably be sufficient to keep values from returning to their peak 2005 level for at least a decade. If both occur, then multiple decades if at all.
Even if one looks at the past, this shouldn’t be anything but a slow rebound after a substantial decline. However, since the conditions that supported higher prices in the past are changing in ways less favorable for higher prices, any recovery may well be slower than even the slowest projections based on the history of the past several decades.
If you read commentary in place like the HGTV message boards, ivillage blogs, or newspaper article comments, there is still a bit of denial but the regulars are moving or have moved into anger. In places like the BrokersOutpost, it’s all anger. It’s fasinating to watch.
I was curious, so I checked. You are right, fascinating. In a “slow down to look at the car wreck” sort of way. I especially liked the HGTV board. So many delusional sellers looking for the secret answer. Even the ones “helping” aren’t helping. Some will get around to PRICE eventually, but even then, it’s done with kid gloves. Time for ‘tough love’ over there. “Look sweetpea52, you’ve had your house on the market for 23 months, shown it to 9 buyers, with no offers. No amount of staging, buried statues, add a pool, remove the pool, repainting, redecorating, or taking new photos is going to make an f’in difference. Lower your price by 10% per week and keep doing it until it sells. THAT’S HOW TO SELL YOUR HOUSE!”
Maybe, someone should tell sweetpea52 where they can bury that statue. LOL
Gwyn: I chortled reading your postings. Talk about re-arranging deckchairs on the Titanic.
har! I try and the few smart cookies come around (a few do read here) but I’m continuously amused by what JaneCheapChardonay comes up with.
The woman pleading and literally crying because Zillow won’t remove her house from the DB or change her valuation is a frightening. The realtor from Co. who likens media coverage of the RE downturn to 3rd Rietch (sp?)propaganda is priceless. You really get some strange cross sections of humanity on these assorted boards.
If nothing else, these wild reactions confirm the extent to which RE moved from shelter to commodity to mania.
“It’s fas(c)inating to watch.”
Yes, it is. But I often wonder how this is all being documented - especially by the academic community. I’m just a student at a local five and dime university - but how about the heavy hitters from the big schools? Do they lurk on those sites, or the HBB? Are they paying attention to how people are reacting and how places are changing - or just positioning themselves for a career with a lobby group?
I teach a course on international political economy that inlcudes a month on financial crisies in the developing world. I have been weaving the eerie parralels between the current bubble implosion and IMF events like the Asia Crisis and Mexico 1994 into the class. This has made the the political and economic issues much more immediate and understandable for the students.
Recovery? Hell, in the NW they still haven’t acknowledged a problem even exists so recovery hasn’t even entered the vocabulary here.
Meanwhile, someone just knocked $5k off a $350k house I’ve been watching sit for about 6 months. Nope, no problems here.
Lots of family in the NW, some who moved back from So Cal, they are the only ones who recognize what is beginning to happen up there. Others think it is a minor rainfall and won’t touch them. My brother in law ( in Vanc, WA )developed 6 lots to build on 2 years ago and had an offer to sell them out to a builder and make 50% profit. No he thought they were going to keep going up up and up; now couldn’t hardly give them away let alone build spec houses on them and he is still paying the bank on the development stuff. As I see it, its just that Seattle, NW is about 9 - 12 months behind the rest of the US but their day is coming. We are looking to buy a 2nd place in Eugene to be close to my daughter, but forwarned I have been watching the market for a year and seeing prices halt from going up, begin to soften, soften, begin to drop and no seeing folks start to get serious, but for us we are going to wait it our another 4 - 12 months. It is fun to watch.
“They have me write up offers 10 to 20 percent below list. There’s no fear anymore of being insulting to the seller or the lender.’”
Oh, please. Even in normal times, I’ve always offered at least 15% less than asking. And no one was ever insulted.
In some areas (Fremont), Bay Area home prices have already fallen 20-25%–but there aren’t any comps to prove it–because almost nothing is selling–and they are the best of the lot. Asking prices alone have fallen at least 15%. I know–I sold a house last Fall. There are several within one block of mine that are now asking 15~20% less. And that’s “asking”. For sure they will close escrow even lower…
If Fremont is falling what about places like Pleasanton?
I expect AT LEAST 40 % haircut when all is said and done.
San Pablo, anyone? From the October 2007 DataQuick sales results (% Chg is YOY):
Community Zip Sales % Chg Median Price
San Pablo 94806 31 -62.7% $445,000
http://www.dqnews.com/ZIPSFC.shtm
Isn’t San Pablo part of the Okland hood?
Yeah, I liked that one too, Palmy! ”
…They have me write up offers 10 to 20 percent below list. There’s no fear anymore of being insulting to the seller or the lender.’”
Oh, I can insult someone- yes I can, but now is waaayyy too soon. I prefer to wait and kick them when they’re DOWN- they roll farther that way! People in Orlando are just beginning to open their eyes.
10 - 20 percent list is a compliment. Take the offer and count your blessings, ’cause the 30 - 50 percent below list offers are just around the corner.
It’s there now but sellers can’t except it. They will if they want to “realy ” sell and move on, otherwise equity continues to go down, down and down. Not a pretty picture but “reality”. Informed, educated buyers know 50% is here now.
well, thats just because in the past they were just selling thier homes. These days, they are selling ( at least it seems) the house, land, and mining rights to the gold they discovered under their homes…………….
if lowball offers won’t do it, there’s got to be another way to insult them..
I would like a two page essay explaining to me why I should offer them -39% instead of -40%
was there lots of chatter about fnm/fre
where do you dump the morts now ?
e-bay, lol.
“In order to survive to build another day, some builders may be forced to sell off valuable inner core land, shut down unprofitable divisions or merge with larger firms.”
Oh, the horror of it all..
i dunno if the Marketwatch page about “17 reasons we need a recession” has been linked, but getting rid of builder dead-wood could be #18.
A public builder the company i work for works with is doing just that. I dont want to say who, but they supposedly are abandoning all projects in the Los Angeles area and got rid of most of the staff, while not building for at least 2 years. I havent seen this info posted anywhere. But if 1 builder is going to just sit around like that, imagine if a couple builders start following that direction.
“It’s a very savvy group of very smart, intelligent buyers who know the market. They have me write up offers 10 to 20 percent below list. There’s no fear anymore of being insulting to the seller or the lender.”
They can’t be that savvy, smart or intelligent if they are buying now. 20% below list is still 40% to much. IMHO you would have a deal at 20% below list.
True.
But someone has to set the comps on the way down.
Got popcorn?
Neil
Neil, rumor is that you are a ConAgra shareholder.
They just shut down their caramel popcorn plant.
HAHHA Neil, when I read that I picktured a bunch of “very smart, intelligent buyers” impaled on to the cow catcher thingy they used to have on the old steam locomotives.
“Perhaps the most sobering figure mentioned in its report today is that Bay Area home prices could fall 25 to 30 percent.” NOT! That’s good news!
Folks–In some areas (Fremont), Bay Area home prices have already fallen 20-25%–but there aren’t any comps to prove it–because almost nothing is selling–and they are the best of the lot. Asking prices alone have fallen at least 15%. I know–I sold a house last Fall. There are several within one block of mine that are now asking 15~20% less. And that’s “asking”. For sure they will close escrow even lower…
I’m even starting to see some capitulation here in “fortress” San Francisco. People are at least willing to accept the fact that prices can fall here.
It’s unbeliebvable how optimistic SF homeowners are. There’s no shortage of denial there, let me tell you.
Money makes people do the most stupid things.
I’ve never cared for the majority of homes in the “city” per se. Of course, I like space.
Yep, along with all the high density housing they are building — should help even more!
Oh how the mighty have fallen and how the tides turn! NOW they realize that if prices don’t fall, they aren’t going to make a dollar!
Then they’ll raise their hands
“Sayin’ we’ll meet all your demands
But we’ll shout from the bow your days are numbered
And like Pharaoh’s tribe
They’ll be drowned in the tide
And like Goliath, they’ll be conquered”
Bob Dylan
Hoz, any predictions on tomorrow? For a moment there, I thought perhaps your sucker rally had fizzled out, but then, by golly, the mighty markets rallied to just top 13,000. I’m just saying, if we’re going to see 11,000 by the end of the year, the “controlled crash” needs to pick up a little steam, no?
And then there’s gold stocks…
http://finance.yahoo.com/q?s=gg
Don’t kid yourself. Today’s action was mostly little day traders. Most of the professionals are on vacation.
disagree. volume was good.
Marinite, what’s going on with your blog? Looks like it’s closed for the season.
OI dropped across the board, it remains to be seen if a rally is in the cards.
How about: tomorrow will have surprisingly little volatility compared to recent sessions. Then big moves in both directions Friday. Probably up first, then another weak close.
The stock market is just one of the many manifestations of this credit bubble.
At some point, some well regarded financial economist will put
2 + 2 = ? together. The losses in the financial systems are so enormous that we are incapable of evaluating the total impact. We can guess. Assuming best case scenario, Goldman Sachs and Deutsche Banks $400B in losses, the reduced lending capacity of $4T reduces US GDP in dollars by 12%. (Goldman’s numbers published show reduced lending capacity of $2T, but there is a simple multiplication error that understated the severity - the GDP difference between the reduced lending capacity is huge). These losses are ‘hard’ costs.
75% of all listed companies are under financial duress. When Citigroup takes additional writedowns, they have less moneys to lend, when Wells Fargo increases its loan loss reserve, less moneys to lend, when Bank of America has a forced liquidation of CDOs it holds, less moneys to lend.
A simplified example: A Company in the US manufactures a widget. It pays for the raw materials (borrowed moneys), pays the workers (borrowed moneys), pays for shipping and demurrage (borrowed moneys) and finances the retailer (borrowed moneys), the retailer sells to consumer (credit card), then the manufacturer borrows moneys against the amount owed from the retailer to continue production. This whole chain has come to a grinding halt.
Large companies are going to be OK, but small companies (employing over 50% of the American work force) are struggling for survival. Many small companies use Asset Backed Commercial Paper. ABCP is made up of a lot of accounts receivable and is trading at a 40% discount. There are few funds available to lend. There is unreasonable risk in lending and getting paid back. The assets on the lending institutes balance sheets are all suspect.
There is no financial institution that I wish to own at this time. There are some US stocks I am looking at owning down the road, but probably a year or more away. I still think the DJIA will be 11,000 by year end, but I have no idea what will happen tomorrow. Probably more sucker rally. What happens in the Hamptons and Greenwich is all that matters, the Street does not believe what is happening in the rest of the US. There has been an incredible amount of fund redemption (401K?, I do not know yet). Most mopes are expecting a year end rally, however “the market will do what it can do, to cause the most amount of pain to the most amount of people.”
Before the end of the year, there will be a strong Financial Institution rally (a classic bear market rally), this will clean out the weak shorts. Then Sayonarra.
I expect to see a couple of forced liquidations of CDOs (perhaps as many as 15!) in the next few weeks. (Google Carina CDO), There is no immune bank. Finance will lead the way down.
Thanks, Hoz. I very much appreciate your analysis, it is very reasoned. Sounds like a grim holiday season, to say the least. I look forward to seeing those forced liquidations.
I’d like to see you on Kudblow. Of course, he wouldn’t allow that sort of “pessimism”.
Thanks Hoz, for your astute introspection. I value your opinion, and I`m sure a lot of other people do to. I fear you may be right, and frankly, I`m worried by what I see.
I don’t think all the big companies are going to take too big of a hit.
I work for a big industrial that everyone has heard of, and we’re in pretty darned good shape. Though I see signs of battening down the hatches to survive a US-led recession. We’ll survive in relatively good shape for one reason, we don’t need debt to survive/operate. We generate hard cash from operations, and have enough cash in the bank to more than pay off our operating debt.
I’m not saying that companies won’t take a hit, but the ones that will survive best have one thing in common… a great balance sheet. That means low debt, and enough cash on hand to avoid any ‘liquidity issues’. Highly leveraged companies are likely toast, and will make a satisfying crunch when they it the wall.
Hi,
Some truth to what Freedman said. The weakness of the dollar helps make exports cheaper to other countries, and makes imports more expensive to US consumers. Driving more purchase of US made goods. So while there are definite problems, the weaker dollar has an upside. That’s why China works to keep the yuan weak, after all.
I bought some beer yesterday. The German beer I wanted was $7.99 per 6p, but the US micro brew was $6.99. So I went US. A small example.
(sure, Busch is probably $4.99 but life isn’t entirely about paying as little as possible! tap water is essentially free.)
I believe the preferred phraseology is “how the worm turns”. Makes me feel all evil and vulture-like inside.
Back from a date with my favorite 1,600 year old…
Another nice thing about giant sequoia’s is that they don’t sell you toxic loans, eh?
How’s your mom doing? Tell her I said, “hey”.
It’s been a world of Sundays since I can remember the aftermarket for mellow yellow, being up $12…
‘If you’ve driven somebody around for two or three days, six to eight hours of driving around in a day, and then they decide ‘Oh, I actually don’t want to buy,’ I don’t know — how does that agent make a living?’ said Sharon Crown, a Coronado-based real estate broker.”
Holey Moley, doesn’t this lady know ANYTHING about pre-qualifying the buyers? I’m not in RE and even I would know enough to invite them into the office, have a long conversation, check out their financials, find out why they think they want to buy, target certain listings to see if they spark an interest, etc. You don’t spend three days driving people around.
Just as an aside, I’ve posted about this before, but back in the mid 1990s, the ex and I were looking to buy a property. We knew how much we wanted to spend and we had the financing lined up. We contacted an agent who was absolutely brilliant. She completely understood buyer psychology and played us like violins, in a good way. Spent a lot of time talking to us, finding out what we really wanted, etc., etc. Then she lined up six properties for us to see in one day. We were starting to get discouraged by about the fourth property and wondering if maybe we’d misjudged her. Well, the last property was perfect. We knew it, and she knew it. But she also knew, that if she’d shown us that property first, we would have probably still wanted to see more, just to be sure. She also negotiated us a good price. She was one of those old-time tough aggressive broads with lots of makeup and a gravelly voice, but a great agent. Yes, they used to exist.
“Abbott said he and his colleagues typically spend between $1,500 and $6,000 to market a property. But if the price on that glossy flier makes a buyer laugh out loud? ‘If a listing is overpriced and you never sell it, then you’re just out that money,’ he said.”
$1500 to $6000 ? I’m throwing the Bullshit flag on this one.
(sure, it’s BS if the houses are selling in a week, but not if it is taking months)..
this doesn’t sound all that unrealistic, if you have ever placed a newspaper ad, done a mailing, had stuff printed…you know how it is..
In a tough market, figure advertising in three papers/re magazines per week, at $100 per ad, times three, times four weeks is $1,200 per month…that doesn’t included multiple listing service fees, printing costs for brochures, postcard mailings, etc.
I worked for a restaurant many years ago and advertising/marketing costs are brutal. The web only gets you so far.. for some dumb reason, the print media is still a must do.
take off a zero and $150 to $600, is more in line.
No. If you advertise in one of the luxury real estate mags, Abbott is right. I’m not in real estate but I know Abbott and he’s a very decent and honest guy. In case the article didn’t say so, the fellow works in the heart of glutted downtown San Diego.
I know agents (more than 10) here in stockton that easily spent $10K/mo and more on advertising. Not to mention 3-7 assistants. A busy guy in my office (85 sales per year at the top) had two to three assistants and spent pretty heavy on mailers ($3k+ per month).
The advertising sent the plastic boob hotties into the office and they tried to sell me ad space on the shoping cart seat that your kid sits on. They wanted $3,000 for my ad on 40 shopping carts for 6 months!!! The busy agent said I was mean for laughing at them and saying that they were fucking nuts. He thought it was a prudent “investment”. Every time I go shopping now those agent ads on the carts make me smile.
I am quite sure that not one sale was closed due to advetising on a damn grocery cart!!!
But if the price on that glossy flier makes a buyer laugh out loud?
Someone has seen me at an open house.
Got popcorn?
Neil
Any good realtor knows that - you show the target property last after about 4-6 dogs.
Once again realtors are proving they are nothing more than glorified taxi cab drivers. I think it would be great to have some loser cruise you around in their Lexus SUV, pick up the cost of the gas plus lose money on your behalf. That is what I call a really great weekend. Bwahahaha losers.
Great agents still do exist, but when there are so many newbies who were used to just “taking signatures and multiple offers”…the current crowd only wanted to ‘hire’ the fashionable crowd to agent for them. The great agents of “yore” will resurface because the others will be weeded out and gone.
Imo..
‘…how does that agent make a living?’
Couldn’t be simpler: Talk the seller into lowering the asking price to market value.
I’ve been through a major downturn and that is not how it works. For agents that are determined to make sales a typical day starts early with a strategy session. Back in the age of paper listings might be put on index cards or tabs of paper and then laid out in various ways. It is critical to know the territory well because when an actual buyer with cash comes in they will say a few things about what they want and it is necessary to infer from that which listings will be best. Listings are becoming pervasive now even in the most choice areas, so the issue is showing the buyer what they want. The very first picture they see might be the only chance and more than three pictures before some interest and a possible tour means things are not going well. Showing homes can sometimes mean a lot of leg work, but most of the time the first two or three homes are it or they aren’t and that is the end of it. With plenty of listings and buyer scarcity and attention spans at a low point sellers have essentially no leverage. More than manias, down markets are what assures realtors get paid because sellers become increasingly anxious to make a sale and will part with six percent easily in order to transfer their loadstone to someone else, anyone else.
I guess I am just different than the typical Realtwhore customer. I simply have no interest in catching a falling knife at a 6 percent discount to the recent ever-declining comps. If they can talk the seller into discounting to anywhere in the neighborhood of where prices will bottom out in four years or so, then my interest might increase.
He was just saying that the sellers will take the 6% hit and pay the commission. He didn’t mention anything about them taking lower offers.
“I’ve been through a major downturn.” Unless you lived throught the Great Depression dont make me laugh. Imagine a United States where more than 50% of homes are upside down and most homes are sold at bank auctions for less than 50% of current value. Welcome to America 2009. I believe that you are the same poster that said buyers agents have no duty to be aware of current events and market conditions, and have no fiduciary duty to disclose this to their clients. I guess anything for a sale is all that matters, and destroying your client’s lives, well thats just part of the game (not my responsibility). I certainly wouldnt use your services. Also, down markets assure realtors they will get paid? I guess you dont understand the meaning. Down market means sales are being cut off hun. The bubble didnt make any of those realtor bastards rich, but the collapse will. Time to wake up, educate yourself, and mature. The realtors rape, s**w, and f*** montra with respect to what duties to their clients is wearing thin and hopefully will cost lots of realtors their jobs.
We had a new lady start at the office yesterday. I’m training her on the sytem for a couple hours, then we need a break so we start chatting about kids, marriage, like that…
She got married 2 years ago and her husband had bought the house he grew up in from his mom, so he had her sign a pre-nup saying she wouldn’t go after the house in a divoce…. no lawyers, so totally non-enforcable.
Anyway, she mentions her husband wants to cash-out refi about half the equity in the house and buy an investment property.
OMG!!! NOW is the WORST time imaginable to buy!!
No, it is a great time she says… There are so many pre-foreclosures out there… You can get for $20K-40K below market.
Yeah, and that is still $100K toooo much!!!
No way, because we can rent it to cover rent. That will put a basement under prices.
Are you including the higher payments on your primary residence and that you’ll get higher interst on an investment property? Are you including maintenance and repair? What if it sits vacant? Is there enough profit in it to cover these things?
So, I go away and find Shiller’s chart showing prices in this peak are 100% too high. I get the ARM reset schedule. I show the spike in foreclosures, and how the ARM reset chart indicates that will double again in the next year. I show her the housing affordability index for PHX. I show her the Case-Shiller index and how prices are falling, and the rate of fall is still increasing. I show her the vacancy rate.
I show her info on AZ’s econonmy, how real estate is the largest sector. Construction has lost 19K jobs and rate of job loss is increasing. I show her our unemployment rate clicking up.
I ask, what happens if a significant portion of the 12% of our workforce that is illegal up and decides to leave when our new employer sanction law takes effect in 6 weeks?
I then leave her alone for two hours to contemplate.
As she’s leaving, she says, I think you’ve convinced me.
Now, that’s laying in on the line, Darrell. Good for you! With regards from your Tucson fan club…
You’re a patient man. I would’ve just JT’ed her over the copy machine and left the charts at her feet.
My coworkers aren’t that patient. Enough “know.” (The majority, of course, are sheeple…) One coworker stated “you never know when home prices will just shoot back up.” I never had to say a word… He was laughed out of the room.
Got popcorn?
Neil
Yeah. My cousins or my co-workers arent that patient either.
I have given this website and tons of other websites about HB, calculated rent vs own, what if house prices go up infinite in future, case shiller index, foreclosure rates, and on top of it how 80% of our workforce got laid off on Feb 28th 2008, and the reasons. Still no use. They went ahead and bought $500k 3 b/r in NW. And are soooooooo excited… and hope that prices wont go down more than $10,000 in their city, cos its different.
Oh yes, I used to work for an Investment bank which was in RE lending business until Feb 27th. After that, dont ask
Saving the Greater Fools, one at a time… I’ve done close to that too, and it’s like missionary work. I say Ahem to you, brother!
Great save, Darrell. Now all you have to do is convince her to dump that deadbeat husband of hers. Sounds like a jerk AND an idiot.
No BIG V:
How about having her see a lawyer and take him up on his offer to keep the house in his name only. So only he is responsible for the cash out refi if it goes bad..
sneaky…huh?
Bull$hit on this one. She won’t listen. She was humoring you. I’ve had it happen to me recently. They don’t get it. She is too smart for you. You tried but that soul is lost. That’s just the way it is.
she’s gonna go home and talk to her husband and decide that you don’t get it and buy the property and regret it later.
c’est la vie
That was nice of you, Darrell. She should take you to dinner in three years.
“That was nice of you, Darrell. She should take you to dinner in three years. ”
AND she will be single.
“‘The headlines are certainly bad for single-family residential homes in outlying markets,’ said Seth Bland, a partner with Wilson Meany Sullivan, which along with CIM Group is building The 88, scheduled to open in mid-2008. ‘But those headlines do not apply to our buyers. The 88 is a new lifestyle option.’”
Yeah. First it was different this time, then different in this state, then different in this county, then in this city, then in the neighborhood, then on this street (because the foreclosure is on the other street), now it’s different IN THIS COMPLEX!
What a douche.
“The 88 is a new lifestyle option”, it may end up being the lifestyle option for a lot of delusional RE people.
http://en.wikipedia.org/wiki/Oldsmobile_88
‘But those headlines do not apply to our buyers. The 88 is a new lifestyle option.’
This is not your father’s Oldsmobile.
test
Congratulations. Passed.
“Patricia Romer doesn’t remember exactly what the sign said. But it promised that a housing development would rise in a vacant lot near her east Visalia home by fall 2006. It didn’t happen. The lot, a former orchard cleared of trees sometime last year, remains vacant. And the sign, which fell down in January, is gone.”
“Meanwhile, Romer said, the lot has become an eyesore. ‘It was just a terrible mess,’ she said. ‘And [at one point] there were people sleeping in it.”
Lots and lots of empty lots like this, in the Central Valley…
“In San Jose, along with the almost 900 units in four high-rise projects either on the market or about to be, 12 more towers with 3,700 units are in the pipeline. ‘San Jose has a total of 4,500 units coming to market over a five-year period where two years ago, we had none,’ Weis noted. ‘No, I don’t think we’re overbuilt.’”
huh? My neck hurts because my head just spun completely around, then wobbled a little bick, then snapped back. How can anyone claim that SJ is “not overbuilt” when house prices are declining and 4500 units are coming on the market within the next 5 years? That doesn’t even count the units coming online in surrounding areas.
You seen Skyline at Tamien station ? It’s surrounded by an eyesore of a neighborhood with a great view of highway 87. Their wishing prices start out at high $300K’s for a very small 1 bedroom. Most redeeming feature is being close to both light rail and Caltrain.
Damn V, get with the program. These are special units in special San Jose, not like the unspecial units in special Miami - and especially not the unspecial units in unspecial Arizona.
Sheeh!! It’s so simple.
Any one unclear about SJ core and what overbuilding looks like should look at all the condo overbuilding in San Diego
“Economist Ken Rosen, a notorious bear on housing who has called for a correction for several years, said home prices in the urban core of the Bay Area could drop 5 to 10 percent - but outlying areas could see tumbles of more than 20 percent.”
He’s a bear? Sounds like a bit of an optimist to me.
This is a must see………..WOW !!!!!!!
http://www.cnbc.com/id/15840232?video=597114925&play=1
I can never get those dang CNBC videos to play. What’s it about?
You’re not missing much, just Maria Bartiromo in roller skates hammered, naked, and playing the ukulele like a pro.
Tell her to put her clothes back on and I just might watch. That woman has gone from the “money honey” to the money harpy in no time flat.
When I look at that fish-faced wench the word “boob” comes to my mind but it has nothing to do with what she has hanging in her sweater.
Was she playing?
“Tip toe through the tulips (bubble)”
“I can never get those dang CNBC videos to play. What’s it about?”
Same here, and I’ve got MPlayer on Linux, which plays nearly everything. Funny, it works fine on MSNBC.
They don’t work in firefox but they do work in IE. Welcome to the 20th century CNBC :p
“Abbott said he and his colleagues typically spend between $1,500 and $6,000 to market a property.”
I think this is a load of BS. I’d like to see an itemized list supporting this statement.
…unless there is some magical ingredient in the brownies…
They must be counting their time spent on this and putting in some hourly rate for their time.
“Economist Ken Rosen, a notorious bear on housing who has called for a correction for several years, said home prices in the urban core of the Bay Area could drop 5 to 10 percent - but outlying areas could see tumbles of more than 20 percent.”
Even notorious bears are right once every ten or twenty years.
Isn’t he the guy that shot Tupac Shakur?
It wasn’t him specifically. It was his possum.
“In 2005, Sabrina Wilson, a Hayward resident, made $110,000 in the home-financing business. Like others, she jumped into the working world right out of high school. Before getting into financial services, Wilson had jobs in retail and fast food.”
This morning on the radio, I was annoyedly listening to some farmer-type complaining that the government is cracking down on illegal workers, and his farm may not be able to even work anymore at all if he can’t find any workers. Well, I have good news for him. About 8100 folks from the East Bay are looking right now
“Before long, Wilson found a job handling mortgages, and she never looked back, until this year. She loved the jobs she held in the mortgage industry, but she has never witnessed a meltdown so complete as what is going on in 2007.”
“‘I have seen ups and downs, but I have never seen it like this,’ Wilson said. ‘Companies are shutting down. I know loan officers who made $1 million a year, and now they are out of the business.’”
This person has “been in the business” for approximately 2 years, apparently working for multiple companies during that time, and I’m supposed to care whether she’s seen this before or not?
“Before getting into financial services, Wilson had jobs in retail and fast food.”
Obviously, these financial services jobs required higher-level transferable skills. Flip burgers, flip houses. Typical of a bubble, anyone with a pulse gets a job in that sector.
I had one mortage company screw up on my loans docs. I told the notary I would not sign them and called the mortage broker that I would not do my refi with them. It sounds almost the same as someone getting your order wrong at the drive through window.
“This morning on the radio, I was annoyedly listening to some farmer-type complaining that the government is cracking down on illegal workers, and his farm may not be able to even work anymore at all if he can’t find any workers. Well, I have good news for him. About 8100 folks from the East Bay are looking right now”
I have a feeling many skills are transferable…
If you can ‘pick-a-payment’, you can pick a pear…
LOL - “if you can dodge a wrench, you can dodge a ball!”
CLANK!
“If you can ‘pick-a-payment’, you can pick a pear…”
A classic - I hope you don’t mind if I borrow it!
“and his farm may not be able to even work anymore at all if he can’t find any workers.”
We hear this all the time in FLA, too. So much for agri-business, making the same arguments the old South made for slavery. I guess they never heard about inventions like the McCormick Reaper. I don’t know why they don’t take advantage of technology, I’m completely dumbfounded by the lack of tech in agri-business. Still in the pre-Civil War era, only with better chemicals.
No, they have plenty of tech. Probably more than they should have. It really all about the money. Why pay $15 an hour plus withholding when you can take your pick of basically desperate, uneducated alien workers at 8 bucks under the table. Then wash and repeat this in 5 million jobs across the country.
Just greed. Nothing else.
Seems to me like all the tech is on the growing side, not the harvesting side. If there were tech on the harvesting side, they wouldn’t need much stoop and stretch labor.
Yes, the tech is more expensive than illegal labor, but cheaper than legal labor. Now, if only we could find some more slaves …
My take on this crackdown on illegal workers is that the gov knows unemployment is rising. Kicking out the illegals will decrease the rate of unemployment. Yes real estate agents will have to gut chickens at Tyson, or sweep floors for HBB readers but they will be employed and that will make the gov numbers look better.
So if you ran an orchard you’d hire legal workers and charge twice as much for your oranges because of your lack of greed? I wonder how long you’d stay in business.
If you have to break the law to stay in business, you’ve got no business being in business.
Oh dear, the farmers might have to actually pay a (gasp) livable, working wage to regular US citizens if their desperate captive illegal workforce is forced away. The HORROR of it all; why, the consumer would have to pay $10/Ib for produce. (no,they wouldnt). But most importantly, joe farmer wouldnt be able to buy hisself a new Ford 3-fiddy dually every year & send bubba to private school. Think I’m jokin? Take a tour of any central valley orchard grower’s private residence. Yeah, G’head Mr Kotter - take real close look see . .. hmm seems the poor farmer been doing pretty damn well on the backs of slave wages for a long time. I hate illegal entry as much as anyone, but am savy enough to see just who profits, and I say BULLSHIT to the myth of farmers going broke without em.
All it means is the farmers wont rake in the cash by the combine-load, and instead have to (double gasp) SHARE some profits! Same theory in San Fran about paying the restaurant workers a living wage … Rest owners kicked n screamed but how many have gone under ?!! hmmmm ..
If you had it so good, would YOU voluntarily let it all go away without putting up a fight? Course not, so dont believe the rhetoric about all the bidness owners going broke; its a total lie.
Aqius, the ole plantation is still alive and well. I’m glad you brought up the grower’s private residence, they’ve got some pretty fancy spreads here in FLA, too, come to think of it. Right around here. Pretty savvy bastids. They don’t even have to provide housing or medical now, the taxpayer does that. No more shotgun shacks or rows of trailers, nosirree. The Farm Bureau/USDA has built some pretty fancy housing for the hired help, with swimming pools and tot lots and jitneys to bring them back and forth to the doctor.
Now you’d think, with all that progress, the farmers could afford some mechanization. In fact, there’s a Japanese fellow in San Diego, I believe, who has invented an automated fruit harvester.
My old boss now works for the company that makes those.
So what happens in 10-15 years when all fruit is picked by robots?
Another interesting case of a few white collar jobs replacing a mass of unskilled labor jobs.
Now just how happy do you think all those guest workers will be when they get replaced by a robot that charges less than minimum wage?
“Oh dear, the farmers might have to actually pay a (gasp) livable, working wage to regular US citizens if their desperate captive illegal workforce is forced away.”
do you honestly think that many americans want to work in the FIELDS? no way. we want people to go to college not work in the fields. the farmers were doing the “desperate captive illegal workforce” a huge favor- giving them a much better and higher paying job than they could get anywhere else. it’s helped keep food prices down and made poor people less poor. why do you think these people risk it all to get here?
I’m not saying that there are not abuses of illegal workers, but if you care about the poor at all you should thank god there is a huge pool of poor and unskilled labor force so close to the richest nation on earth. my god, if there wasn’t.
“In 2005, Sabrina Wilson, a Hayward resident, made $110,000 in the home-financing business. Like others, she jumped into the working world right out of high school. Before getting into financial services, Wilson had jobs in retail and fast food.”
you think this lady is going to work in the fields?
Why do I get the sinking feeling that the MSM is just copying and pasting dot-bomb sob stories from 2001 - simply replacing tech with RE appropriate terms?
“thank god there is a huge pool of poor and unskilled labor force so close to the richest nation on earth. my god, if there wasn’t.”
If there wasn’t, agri-biz would have mechanized the harvesting process decades ago, necessity being the mother of invention and all that.
Last time I watched the history channel farmers were working in air-conditioned $300,000 combines with GPS that they hardly had to steer. I’m sure there are still some crops for now that need to still be worked by had during some of the process.
This is what I’m talking about.
http://www.wired.com/science/discoveries/news/2007/06/robo_picker
It’s a beautiful thing.
“Last time I watched the history channel farmers were working in air-conditioned $300,000 combines”
With a mounted shotgun to pick off birds during harvest and a built in frig for the beer. Life in the country. Everything is fine until you burn out a bearing and the wheel overheats causing a grain explosion or some moron decides to pass you in a ‘no passing zone’ while you are making a left hand turn with the signal on and you have the right of way, but they clip your front tractor wheel and sitting two stories up your going over and pulling 10+ tons of hay. And your praying to Jesus, Buddha, Mohamed and other real or semi mythological deities to keep the tractor from throwing burning oil on you. They stop and you look at the “out of state plates” and want to grab the friggin shotgun, but your arm isn’t working anymore….
Farmers have traditionally hired students during summer break to harvest their fruit. Permanent farm hands get paid more money to manage the part-time and temporary workers.
hey, guess what? no one WANTS to work in the fields. Legal,illegal, white, brown, green, purple or whomever. it’s a backbreaking, dirty, hard job. Thats just a fact. But what is also a fact is that the harvest has to come in. How is it going to happen?
The age old question/dilemma isnt solved by having illegal workers doing it. Thats just a temporary fix. What matters is how the truth of the entire situation is made obvious. Not skewed by the farmers to their advantage, nor the construction companies, nor restaurant, meatpackers, and any other labor intensive need that profits from cheap workers. Yes , cheap workers that have no other choice but to work for more than they left at home, but less than a legal citizen.
People keep talking about legalizing workers, but if you really stop & think about what would happen NEXT you’d realize its a self defeating cycle; Once the large mass of illegals, doing the brutal field work ( and other detested jobs ) are legalized, do you think for one moment they are going to remain IN THOSE HORRIBLE JOBS??
Of course not. Would you? Would I ?! Hell no, they will do what any sane person would, and that is head lickety split for better jobs in the nearest city. Yeah, think about that for awhile, then you wonder, gosh darnitt, why arent they grateful & stay down on the farm? Well again, why would they??
So now you have empty fields, and you need MORE ILLEGAL WORKERS to replace the suddenly legal ones who moved on for higher wages. This already happened in the ’80’s.
THATS why I suggest just paying the people ALREADY HERE in the country a livable, not exhorbitant, wage for those dirty jobs. And why cant that happen??! Why ?!? The average citizen will gladly pay a bit more for a product IF THEY KNOW FOR SURE IT WIILL GO THE WAGES OF THE WORKER & NOT LINE THE POCKETS OF THE FARMERS/CONSTRUCTION/HOTEL OWNERS!
Why should the US citizens be forced to decline to a 3rd world standard of living just to satisfy the paychecks of the rich? There is a mininum decency to our way of life which is accepted, indeed outlined by the founding fathers, and which makes us the envy of the world, but the rich class resents this situation & has declared econimic warfare on the middle class, simply for the pusuit of obscene profits. Not fair profits. Not high profits. But outrageously high sacrifice-the-middle-class profits.
This wasn’t intended to be a diatribe but does reflect my opinion that the last decade has crystalized into clear battle lines between the haves ,the have-nots, and the want-to-have-it-alls. As the rich dilute & weaken the labor force by allowing massive amounts of desperate workers to bring down wages, only a fool will stand idly by pretending that the future generations will have it better, not worse.
I dont like being forced down the road to serfdom, and I wont go willingly, quietly, or without a struggle. It’s just that simple.
Right on Aqius!
Aquis, I think I’m in love!
Somehow I doubt that many white collar workers are going to want to work in the fields for sub minimum wage.
but this brings up another interesting point. A lot of complaints about food prices lately. Also about food imports. What’s going to happen if a significant number of farmworkers are forced to leave?
A. food prices will go down due to fewer farmworkers eating
b. food prices will go up due to the need to pay higher wages
c. more food will be imported due to lower costs in other countries.
Hint, the answer is not A.
I would really like to see a way to legally bring in the farmworkers that are needed in the US. Unfortunately I don’t see anything happening til 09 as candidates are fearful of being tagged as pro-immigrant nowadays.
“In 2005, Sabrina Wilson, a Hayward resident, made $110,000 in the home-financing business. Like others, she jumped into the working world right out of high school. Before getting into financial services, Wilson had jobs in retail and fast food.”
Whooweee…the NEW ECONOMY
From sales and fast food CLERK with one of those punch in the pictures of Big Mac cash registers because nobody can figure out how make change to SIX FIGURES in RE financing.
Even Stephen King couldn’t make these horror stories up.
Hey HD..
How’s things?
Any thoughts on Boston North? Where to from here?
Why are you surprised?
The same people who impulse shop at the mall, and gobble down cheeseburgers 4x a week, are the same people who were jumping feet first into these mortgage products. She was just following her customer base.
I just wonder how she will ’service’ her peeps in the future…
What exactly do you mean by “peeps”?
peeps = people
“Patricia Romer doesn’t remember exactly what the sign said. But it promised that a housing development would rise in a vacant lot near her east Visalia home by fall 2006. It didn’t happen. The lot, a former orchard cleared of trees sometime last year, remains vacant. And the sign, which fell down in January, is gone.”
It’s a double loss really…
Useful fruit trees used to be in those 40 acres, and if the ground was compacted in preparation for houses, nothing will grow there, in the future.`
“Useful fruit trees used to be in those 40 acres, and if the ground was compacted in preparation for houses, nothing will grow there, in the future.”
Except for radon gas. At least, that’s what happens here in FLA. According to a lady at a local environmental testing firm, that does home inspections, homes with concrete slabs directly on top of former ag land tend to generate radon gas. I didn’t understand it all, but it was something about the concentrated phosphate in the fertilizer or some such thing. She mentioned one area around here, which used to be mostly farmland, and now is all developed, where almost all the houses they’ve tested, tested positive for unhealthy levels of radon. Wondering if that happens in CA.
Radon doesn’t come from fertilizer or phosphates, unless Chernobyl is the suppler. Radon comes from naturally occurring minerals in the ground. (Uranium/radium bearing ores) What happens is that houses can act as containers to keep it trapped in a house rather than letting it disperse naturally into the atmosphere. The radon was always there, just now there is a nice sealed house to trap what is seeping out of the ground.
NEVER believe ANYTHING you read in the San Jose Murky-News, quite possible the worst, most inaccurate self-serving daily ever printed IMHO. This paper is an embarrassment to an already embarrassing city full of thieves, crooks and liars. I believe they all would sell out their Mothers for a dollar, or less, or more advertising space by the local real estate cartel or the illegal alien mafia. Beware.
For those who don’t know the Mercury News, they have twice weekly special THICK RE sections full of ads and happy articles. Even the bad news is sickly sweet coated not to offend the overlords.
The City of San Jose is aggressively ticketing motorist to raise money for city.
They nabbed me the other day. I think they’re even using illegal tacticts to try to get people to pay the fine up front even if they’re pleading guilty. SJ is truly a wanna-be city.
I can vouch that the meter maid is very active around the dining areas at lunch, you’re better off overfeeding the meters.
Yeah, I hear ya on the increased traffic enforcement/revenue raising scheme. Motorcycle cops gave me a ticket for barelyyy sliding thru a stop sign, just around the corner from my home. Habit made me impatient, (but not a hazard) - just not a 100% full stop - more like 90% … no cross traffic …
they are lucky (this time) that I’m so burned out from years of visitation court appearance battles w/the ex, that I gladly just paid the $188 ticket to avoid another day in court.
“I can vouch that the meter maid is very active around the dining areas at lunch, you’re better off overfeeding the meters.”
Tough to get into, and back out, of the new Starbucks at 3rd & Santa Clara before getting a ticket.
Cali is a police state. Well really its a any kind of government worker gets more than private industry state. Good thing Cali has millions of illegals to do all the crappy work there so the rest of the work force ( that don’t have government jobs ) can become realtors and sell real estate to each other. Well it could be worse you could be in AZ where their are plentful jobs that pay real bad right at the federal minimum wage. And no police at all compared to Cali.
chuckle…
Are you saying 50 cents in the meter will stop the sale of that triple venti carmel mocha latte frapachio, soy?
Got popcorn?
Neil
Ah, mexicanization of America.
Doing the corrupt Police jobs that American’s won’t do
I’d love to see SJPD do traffic enforcement. I’m tired of getting passed in the turning lane while going 30 in a 25 mph school zone. No more 50 mph in 35 mph residential streets. No more running red lights. Living in SJ for 8 years, I have seen exactly one SJPD do a traffic stop.
Los Gatos on the other hand, they do enforce residential speed limits.
“Economist Ken Rosen, a notorious bear on housing who has called for a correction for several years, said home prices in the urban core of the Bay Area could drop 5 to 10 percent - but outlying areas could see tumbles of more than 20 percent.”
This guy is a pansy. His numbers need to be multiplied by 5.
And keep in mind he said they COULD drop 5 to 10 percent, implying that he thinks they won’t even drop that much.
He’s even more of a pansy…
in a lot of areas we’re probably already down at least 5%.
Outlying areas could see falls of more than 100%? I know some folks are hoping for a depression but that seems a bit outlandish.
OTOH, maybe you are on to something. I wouldn’t take a free house beyond Pleasanton if I had to live there and commute to SJ. so to me, a house in Livermore or beyond has negative value. hmm…
“‘You know, these listings, it does cost money to carry them, to advertise them, to work on them,’ said broker Jim Abbott. ‘And the huge, vast majority of them are not going to sell.’”
Oh how I pity you, you poor POS.
NOT!.
Considering the obscene amount of money you douchebags charge as commission in comparison to the NOTHING you actually do, you should bow down in humility and thank God for all the money you’ve ripped-off from buyers to date.
Then eat shit & DIE.
Gee Dan…..don’t hold back……tell us how you really feel.
Bank of America’s Countrywide Deal Loses $858 Million
Nov. 20 (Bloomberg) — Bank of America Corp.’s $2 billion investment in Countrywide Financial Corp., the biggest U.S. mortgage lender, has lost almost half its paper value as Countrywide fell amid speculation it may file for bankruptcy.
Charlotte, North Carolina-based Bank of America, the biggest U.S. bank by market capitalization, made the preferred-stock investment in August to help bail out the lender amid the global credit rout that cut off its access to short-term financing.
Bank of America has the right to convert the preferred stock to common shares at $18 each. If the preferred shares had been swapped for common stock at the mortgage lender’s high of $24.46 on Aug. 23, the first day of trading after the deal was announced, Bank of America would have made a $700 million paper profit. Countrywide also agreed to pay dividends of 7.25 percent on the preferred shares.
Instead, Countrywide’s shares have tumbled, leaving Bank of America’s investment down $858 million, data compiled by Bloomberg show. Countrywide fell 29 cents to $10.28 today in New York Stock Exchange composite trading as the lender denied speculation it will seek protection from its creditors. The shares have lost about 76 percent this year.
Scott Silvestri, spokesman for Bank of America, declined to comment. Bank of America’s shares fell 5 cents to $42.77 in New York Stock Exchange trading today. Bank of America shares are down about 20 percent this year.
But wasn’t there something written about BofA hedged by shorting Countrywide stock?
They lost the right to do that when their regulator said they would not allow the bond to be converted to stock.
Oh well, they shouldn’t have signed the contract then.
I think B of A has some secured Countrywide debt, or some sort of creditor rights should Countrywide go BK. They can’t possibly be stupid enough to have no upside should this pig go bust. Aside from all the loan losses, how is Countrywide going to keep operating now that they’ve lost nearly all of their new loan originations? There is no longer a market for the loans they sold.
Bank of America’s Countrywide Deal Loses $858 Million .
Nov. 20 (Bloomberg) — Bank of America Corp.’s $2 billion investment in Countrywide Financial Corp., the biggest U.S. mortgage lender, has lost almost half its paper value as Countrywide fell amid speculation it may file for bankruptcy.
Charlotte, North Carolina-based Bank of America, the biggest U.S. bank by market capitalization, made the preferred-stock investment in August to help bail out the lender amid the global credit rout that cut off its access to short-term financing.
Bank of America has the right to convert the preferred stock to common shares at $18 each. If the preferred shares had been swapped for common stock at the mortgage lender’s high of $24.46 on Aug. 23, the first day of trading after the deal was announced, Bank of America would have made a $700 million paper profit. Countrywide also agreed to pay dividends of 7.25 percent on the preferred shares.
Instead, Countrywide’s shares have tumbled, leaving Bank of America’s investment down $858 million, data compiled by Bloomberg show. Countrywide fell 29 cents to $10.28 today in New York Stock Exchange composite trading as the lender denied speculation it will seek protection from its creditors. The shares have lost about 76 percent this year.
Scott Silvestri, spokesman for Bank of America, declined to comment. Bank of America’s shares fell 5 cents to $42.77 in New York Stock Exchange trading today. Bank of America shares are down about 20 percent this year.
OT,,
But here are some great ones from Bloomberg..
Bank of America’s Countrywide Deal Loses $858 Million (Update1)
By Caroline Salas
Nov. 20 (Bloomberg) — Bank of America Corp.’s $2 billion investment in Countrywide Financial Corp., the biggest U.S. mortgage lender, has lost almost half its paper value as Countrywide fell amid speculation it may file for bankruptcy.
OUCH!
Pimco’s McCulley Says the Fed Funds Rate May Decline Below 3%
By Kathleen Hays and Deborah Finestone
Nov. 20 (Bloomberg) — The Federal Reserve may reduce its target interest rate to below 3 percent to keep the U.S. economy from lapsing into recession, said Paul McCulley, a fund manager at Pacific Investment Management Co
DOH!
The following is worth reading at the link that follows…
At Subprime Event Too Early to Tell Who’ll Survive - Nov. 20 (Bloomberg) — They dubbed it “The Survivors’ Conference.” In early November, 2,000 people who handle asset- backed securities for a living crowded into a ballroom at the JW Marriott hotel in Orlando
http://www.bloomberg.com/apps/news?pid=20601109&sid=acYywk3n_iL8&refer=home
Once again, despite prices plummeting in the rest of California, the Eureka Reporter illustrates prices are still going up in coastal northwest California. When is this ever going to end? Sacramento, San Diego, and the Central Valley have dropped 20-40% and yet this little area can stay similar? At this rate, within a year prices will be cheaper in San Diego than Eureka! Some encouragement, people!!!
http://www.eurekareporter.com/ArticleDisplay.aspx?ArticleID=30864
Those are just median prices. They probably reflect the fact that only lateral moves are happening, and those transactions tend to be for higher-end homes. The Realtors actually have a way of calculating across-the-board price changes, but they won’t do it unless that number is in their favor.
The Eureka Reporter is probably just another asspit.
Don’t worry, based on the median income it can’t last there either.
Looks like one reporter has already gotten sick and tired of the media being blamed for the Deflation of the National Housing Souffle!
From CNBC.com
Diana Olick
The biggest focus of this month’s report is negative media attention to the housing market: “Builders are worried that the national media has tended to report negative housing stories as if there is one real estate market, when in fact, there is no such thing,” says Brian Catalde, president of the NAHB in the press release. “As a result, some healthy markets are being unfairly impacted by this negative media coverage.”
I agree with Mr. Catalde that the bulk of the media coverage tends to be far more general than pointed and that the very premise of the real estate business–location location, location–gets lost in the flurry of national numbers and statistics and ultimately fear. Home buying is one of the most emotional purchases anyone can make, so buyer sentiment, confidence, is as big a factor as location, number of bathrooms and granite in the kitchen. Some local markets, with strong demographics, will inevitably fall victim to buyer fear, largely fueled by national news.
Here’s where I respectfully disagree: The media may focus on the negative numbers, but we don’t make them up, and I’m specifically talking about the mortgage crisis that is the real driver in today’s housing recession. Defaults and foreclosures are at record levels. The lending industry has fundamentally changed the way it does business in just the last six months, and many of the loans that fueled housing prosperity in the last decade simply aren’t being offered anymore.
That hits the big public home builders hard because they build the bulk of the starter homes in this country, the ones that younger folks with lesser credit are looking to buy. They also build step-up homes, which depend on buyers being able to sell their existing homes, which may be to, again, subprime borrowers. We report the earnings from the big builders, and they are not pretty numbers these days.
I remember, during the height of the housing boom, doing dozens of stories on sky-high appreciation, on flippers making millions, and on front-porch bidding wars. I don’t recall anyone blaming the media for the good times.
If you report the facts and the facts happen to be negative, you are “too negative”. What’s more amazing given the dismal state of reporting and the effort of those in the building industry to obscure the facts is that the “negative” information is getting reported at all. Perhaps once it’s an elephant and the room keeps shrinking, it’s impossible to ignore any longer.
Thank you, Diana Olick!
The Bay Area stands a greater chance to feel the effects of a recession more so than other regions. Simply put- a huge swath of the citizens here have almost all of their money tied up in mortgages and have zero wiggle room. Most are basically one small slip-up in their professions and financial situations from falling off a cliff. I see this everyday.
I see the Bay Area as having some rather serious economic fallout over the next 5 years.The name of the game here is volatility.It can rise dramatically, and as we’ve seen, it can fall as well.
Smarter minds required to explain this…ACA faces possible default. Huge problems for ibanks.
In the 10-Q filed yesterday, auditor Deloitte Touche wrote:
… “on November 9, 2007 Standard & Poor’s Rating Services (“S&P”) placed its financial strength rating of ACA Financial Guaranty Corporation (“ACA FG”) … on “CreditWatch with negative implications”. Should S&P ultimately downgrade ACA FG’s financial strength rating below “A-”, under the existing terms of the Company’s insured credit swap transactions, the company would be required to post collateral based on the fair value of the insured credit swaps as of the date of posting. The failure to post collateral would be an event of default, resulting in a termination payment in an amount approximately equal to the collateral call. This termination payment would give rise to a claim under the related ACA FG insurance policy. Based on current fair values, neither the Company nor ACA Financial Guaranty would have the ability to post such collateral or make such termination payments.
So a downgrade would effectively wipe out ACA, and the counterparty (the Investment Banks) would be left without insurance for their CDOs.” From CR. posted today.
Either Standard and Poor’s will leave the rating unchanged or Merrill gets to write down $10B (in the event of ACA BK, total CDO exposure risk rises by USD 69bn).
My moneys are on S&P to leave ratings unchanged, a lot cheaper to bribe S&P auditors than to come up with $10B in writedowns.
ACA faces possible default.
“In the 10-Q filed yesterday, auditor Deloitte Touche wrote:
… on November 9, 2007 Standard & Poor’s Rating Services (“S&P”) placed its financial strength rating of ACA Financial Guaranty Corporation (“ACA FG”) … on “CreditWatch with negative implications”. Should S&P ultimately downgrade ACA FG’s financial strength rating below “A-”, under the existing terms of the Company’s insured credit swap transactions, the company would be required to post collateral based on the fair value of the insured credit swaps as of the date of posting. The failure to post collateral would be an event of default, resulting in a termination payment in an amount approximately equal to the collateral call. This termination payment would give rise to a claim under the related ACA FG insurance policy. Based on current fair values, neither the Company nor ACA Financial Guaranty would have the ability to post such collateral or make such termination payments.
So a downgrade would effectively wipe out ACA, and the counterparty (the Investment Banks) would be left without insurance for their CDOs.” From CR, posted today.
That’s such good news and make me feel so good, I might need a cigarette..
This is getting better and better all the time…
GOT CASH?
I’d be impressed if ACA ever had a market cap of more than ten cents.
I always bid the “Buy Now” price on EBay because I don’t want to insult the seller.
I’m just mad there’s no “Overbid the Buy Now price” button that I can hit to ensure that I don’t get priced out of the market.
This blog lately reminds me of similar doomed predictions about dying companies on another site from back in the day: F**KEDCOMPANY.com
love it. LOVE IT! (Bay Aryan, your rambling upper-crust muses are missed)
OMG. Me, too. Haven’t been to the spinoffs in at least a year. The whole James thing soured me. Hung out there regularly, though, starting on 9/11, when you couldn’t really get the latest news except there. I think I’ve seen Hell is Like Newark here once or twice. Good times, good times.
This Washington Post piece talks about legislation to allow bankruptcy judges to renegotiate (apparently) every aspect of a mortgage: Interest rate, principal, payments… everything except the market value of the house, of course. Any regulars care to comment about this legislative falling knife?
Much as I wouldn’t like it on the one hand, on the other hand I would consider it sweet justice considering the banks and financial institutions lobbied so hard to get the bankruptcy laws changed in their favor. Like to see that backfire in their faces.
That lobbying work is what got me to realize the crap was about to hit the fan. Sold my house, restructured investments
What does that do to the contractual terms to which the lender thought they had agreed?
And to other would-be lenders’ willingness to make loans in the future?
Or to investor willingness to put up moneys for loans if the contract is not binding and can be summarily modified to reduce its value to the lender?
It sounds to me like this legislation is an anti-mortgage-lending proposition.
It’ll never happen. As was pointed out in the article, it really wouldn’t help most borrowers, it would just prolong the agony and further clog the court system. It’s bad for both the lender and the borrower.
That legislation would be like shooting the mortgage lending industry in the head to put it out of its misery. No one would ever want to lend anything to anyone again if that law were to be enacted.
Think that’s great, how about this?
http://www.sacbee.com/749/story/507430.html
I hate those websites that require registration, although I did get a peep before they cut me off. Something about California lenders agreeing to freeze rates? Whoo-hoo. I submit most buyers couldn’t even really afford the “taser rate” for more than a few months, maybe a year. Not to mention, it still doesn’t prevent the value of their homes from declining.
More info:
http://gov.ca.gov/index.php?/press-release/8147/
I’m tellin’ ya, they don’t call Arnie the Terminator for nothing. Watch this interesting bit of contagion spread. Gives new meaning to the term “Countrywide”. Florida’s Good Time Charlie Crist likes to do whatever Arnie does, so I can’t wait to see this happen in Fla. Lawdamighty, at least before, people could count on the fact they could walk away. This just injects more confusion into the scenario. Yeehaaa!
you probably already know about this…but if not…there is a way around that for sacbee and many other sites at bugmenot.com
Sounds like a great way to dissuade anyone in their right mind from making a mortgage ever again. Should bring the price of a house down by 90%
“In 2005, Sabrina Wilson, a Hayward resident, made $110,000 in the home-financing business. Like others, she jumped into the working world right out of high school. Before getting into financial services, Wilson had jobs in retail and fast food.”
“Before long, Wilson found a job handling mortgages, and she never looked back, until this year.”
It kind of reminded me of the Internet Boom. There were so many open positions at these Internet companies that there were not enough qualified people to fill them. I recall we hired a marketing person who got paid $100,000 and her previous position was a retail store. What the…? She was SOOOO unqualified.
Now, since the demand for homes, loans, etc. is slowing to a trickle, people are dropping like flies and they are in trouble. How do they make that kind of money again. They don’t. They need to re-educate themselves. It’s amazing that they were your financial advisors, your experts to handle a large financial transaction. But when you really look behind the covers, they were once your local cashier, homemaker, construction worker, fast food, teacher. They had no business giving you advise.
When I’m involved in a large transaction or even an employment contract, I have my lawyer look at the contract and make recommendations. It’s actually inexpensive.
There has to be something in the works, another “surprise” for tomorrow. World leaders cannot afford to let this unravel any further.
Coordinated intervention would seem to be in their mutual interest, but what form would that possibly take that has not already been in play?
SPR release to knock down oil, maybe dump money into the GSE’s. It won’t solve the long term problems, just enough to stabilize things.
Have you heard of the prisoners dilemma?
In game theory, the prisoner’s dilemma (sometimes abbreviated PD) is a type of non-zero-sum game in which two players may each “cooperate” with or “defect” (i.e. betray) the other player. In this game, as in all game theory, the only concern of each individual player (”prisoner”) is maximizing his/her own payoff, without any concern for the other player’s payoff. The unique equilibrium for this game is a Pareto-suboptimal solution—that is, rational choice leads the two players to both play defect even though each player’s individual reward would be greater if they both played cooperate. In equilibrium, each prisoner chooses to defect even though both would be better off by cooperating, hence the dilemma.
In the classic form of this game, cooperating is strictly dominated by defecting, so that the only possible equilibrium for the game is for all players to defect. In simpler terms, no matter what the other player does, one player will always gain a greater payoff by playing defect. Since in any situation playing defect is more beneficial than cooperating, all rational players will play defect, all things being equal.
Prisoner’s Delemma
“World leaders cannot afford to let this unravel any further.”
Reminds me of the line from The Godfather, where the movie producer who ends up in bed with the horse’s head tells Tom Hagen “A man in my position can’t be made to look ridiculous”.
“With homes taking longer to sell, and buyers choosing between more homes on the market than just about ever, real estate agents are getting pickier over the clients they’ll take.”
Come to think of it, the feelings are mutual. In fact, I have become so picky about Realtwhores that I will take none of them. The only time in the past two years I have talked to a Realtwhore was when my sister and I visited an open house in the area. My sister became irate with me when I rubbed in the fact that prices were falling and nobody was looking besides us.
“real estate agents are getting pickier over the clients they’ll take.”
I talked to a realtor today and he told me he’s selling a lot of homes in Temecula to investors but not families.
Ask him to tell you about the recent UFO sightings he’s witnessed in the area too. The give him a lollypop and put him to bed.
Of course he did say its a great time to buy!
Panic? Perhaps not.
Black swan about to blow up Paragon? Probably so.
November 21, 2007
Paragon boss who insists there is no panic
James Rossiter
Nigel Terrington did not go university, preferring instead to go straight from his school in Wimbledon into banking. A spell at Charterhouse, the old UK venture capital house, was followed by time as a corporate financier at UBS.
In 1987 Mr Terrington joined Paragon, trading under its old name National Home Loans, where he worked in mortgage-backed securities. National Home Loans lent to the sub-prime market before Britain had got used to the term for lending to those with poor credit histories. The company expanded rapidy during the property boom of the late 1980s but nearly went bust during the 1991 recession. Its funders at the time, mainly banks and local authorities, cancelled funding arrangements.
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article2910985.ece
here’s a link in case you accidentaly swallowed posion and need to barf
http://www.youtube.com/watch?v=Ei5OrV-CmHg&feature=related
The commercial is right; “No one can do what Countrywide can”.
Except maybe a neutron bomb.
Is that lady a retired stripper? I hope she at least got Countrywide to pay for the plastic surgery.
Don’t know if this story has already been posted….this is big stuff.
“Schwarzenegger, 4 big lenders agree on plan to stall high mortgage rates” (SF Gate)
http://tinyurl.com/2g3uwz
They just ran a huge piece on ABC on the housing bust. All these concerned reporters and politicians with long faces getting to the bottom of the problem right now. You can just see flippers and investors all over America realizing with one collective unconscious catharsis that they’ve just been slapped by the 20 pound trout and it’s only a matter of time before the holy mormon desert lily does its unsavory task.
“A recession is a bitter pill to swallow, and the Bay Area Council isn’t trying to sugar coat it. The council’s new economic analysis says a recession is almost certain.”
We are in the beginning stages of a recession that looks like it’s going to be a nasty one!
With homes taking longer to sell, and buyers choosing between more homes on the market than just about ever, real estate agents are getting pickier over the clients they’ll take. ‘If you’ve driven somebody around for two or three days, six to eight hours of driving around in a day, and then they decide ‘Oh, I actually don’t want to buy,’ I don’t know — how does that agent make a living?’ said Sharon Crown, a Coronado-based real estate broker.”
“‘You know, these listings, it does cost money to carry them, to advertise them, to work on them,’ said broker Jim Abbott. ‘And the huge, vast majority of them are not going to sell.’”
Awwwww…let me break out the violin….
“Matt Anderson, a partner in an economics and real estate research firm in Oakland, hedged his bets. It’s a tough call, he said, in a city that has never offered this product.”
“‘I wouldn’t call it a slam-dunk in today’s market. The stock market is unsettled. The economy is doing well, but it’s not an outright boom,’ he said. ‘The big question is whether they hit the demographic the right way. Affordability is not really an issue.’”
Affordability NOT an issue???? The economy is doing WELL??? Man…I wish I could contact this guy and ask him for a bit of whatever he’s smoking….must some SERIOUSLY mind-altering stuff.
“Matt Anderson, a partner in an economics and real estate research firm in Oakland, hedged his bets. It’s a tough call, he said, in a city that has never offered this product.”
“‘I wouldn’t call it a slam-dunk in today’s market. The stock market is unsettled. The economy is doing well, but it’s not an outright boom,’ he said. ‘The big question is whether they hit the demographic the right way. Affordability is not really an issue.’”
Affordability NOT an issue???? The economy is doing WELL??? Man…I wish I could contact this guy and ask him for a bit of whatever he’s smoking….must some SERIOUSLY mind-altering stuff..