Bits Bucket And Craigslist Finds For February 6, 2008
Please post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Toll 7th Drop…
“It’s like driving the Titanic, things don’t turn on a dime,” said Dave Crossman, an analyst at Kirr Marbach & Co. in Columbus, Indiana whose firm owned about 370,000 Toll shares as of Dec. 31. Crossman commented before the report”.
You can tell this fellow is not nautical, you do not ‘drive’ a boat/vessel of any size. Anyway I still wonder which national builder will be the first to take it in the shorts.
http://www.bloomberg.com/apps/news?pid=20601103&sid=aBeyCgqv5e64&refer=news
When times get tough, the weak must go to their desks to mix their metaphors in a now half-empty glass. However, make sure you don’t bite the hand that rocks the cradle.
Where was I going with that?
Oh, this is as much fun as shooting monkeys in a barrel.
I’m looking forward to the day when I can have my cake and the worm, too.
The worm has most definitely, turned.
Speaking of worms, wasn’t TOL one of the stocks upgraded by Daniel Oppenheim yesterday? He stated that he liked them because house prices are now afforadable. Their outlook was improving. WTF? Toll sells the most expensive homes of all of the builders. They are nowhere near affordable. How do any of these dorks have jobs?
what goes up… must get squashed like a nasty roach.
Because they have a degree and an MBA from some Ivy League school. I swear, these guys are tarnishing the reputations at top universities.
Yea it’s insane how anyone listens to these “analysts”, they are wrong 90 percent of the time, there worse then cramers dumb ass, and most of them are on the take so to speak…
You can’t trust any of them further than you can spit a rat.
Yesterday, I watched Larry Kudlow and some other analyst being interviewed by Bartiromo. Larry mouthing off that the economy is strong, this was just a blip, etc. etc. etc. It was crazy talk. The other analyst disagreed and pointed out several economic factors and almost belittling Larry and basically pointed out that nobody can forecast that the economy is strong right now. So Larry agreed that we may be on a recession right now etc. etc. etc.
WTF!? he just said the economy was strong and that we weren’t in a recession. These A$%holes can turn in a dime when aother analysts calls them on anything.
Other guy was Ron Insanna.
Larry Kudlow is a faaaaaabuloooouuuuussss dresser! And I just adore, I mean ADORE his pinky ring! If I were a gay man, I would have a HUGE crush on him!
Knock all these analysts and members of congress down to an annual salary of 50-60 grand or less and they will start to actually understand the true nature of the economy and what the average person on the street goes through. When you are surrounded by people who make over a certain amount of money, of course you are going to think the economy is doing great. Everyone you know is raking it in, going on trips, buying fancy goods, etc. You’re not exposed to the financial reality that most people go through in a year.
What goes up is a penny earned.
A penny saved is what must go down.
$1 saved is a $1 earned. $1 earned is $.55 after the govt gets their share.
I never can get cliches right. ‘Burning the hatchet at both ends’, ‘keep my eyes squeezed’, and so forth. I’ve learned to just leave those things the hell alone, and we’re all the better for it.
Comment by waaahoo
2008-02-06 07:19:49
‘You can’t trust any of them further than you can spit a rat.’
But, you know–I think I’m gonna be able to remember THIS one. Thanks, hooey.
I worked for a South African man many years ago. He was familiar enough with American metaphors to get himself into trouble. Instead of saying, “jerking my chain” he used to say, “jerking me off.” I’m pretty sure that’s not what he meant.
RE: Oh, this is as much fun as shooting monkeys in a barrel.
It’s “RATS” in a barrel.
Why would anyone keep their rats in a barrel? That’s just craziness.
“One can of worms leads to another”
When the going gets tough, you buy now before you are priced out forever.
“You can tell this fellow is not nautical, you do not ‘drive’ a boat/vessel of any size.”
You will see the process of maneuvering a ship from one point to another referred to as ’shipdriving’ in many places. In fact here’s a link from the US Navy:
https://www.npdc.navy.mil/slc/sublrnfacnfk/default.cfm?fa=depart.tactics
And one from the Coast Guard: http://www.uscg.mil/d1/units/cgcwillow/Deck%20Force.htm
Technically, avoiding an iceberg is a steering manouver.
Nice debate, but the issue is how maneuverable is a ship that has already struck an iceberg and half under water.
Actually, when we are racing the sailboat, it IS called ‘driving the boat’ when you are steering.
Re “shipdriving” - my uncle was a Navy pilot who came up from the ranks.
“@#$*#$)(*&# Annapolis class-ring ship drivers” is a phrase he’s been heard to use more than once.
Yea. but is it ‘driving an airplane’ or don’t you steer that one also, or drive it into a terminal or into the wind..what isit
I grew up on boats - could handle the family 32 footer out on the lake by the time I was 10; got my first dinghy when I was 10; a ski boat when I was 15; and took the 38 footer out alone when I was 18. This was back in the days when boats were wood and you belonged to a yacht club so you had a place to keep it.
We NEVER said “drive”. We ‘ran’ the boat up the coast or would ‘run her over to the shipyard’. We would ’steer to port’ or ’steer on the bouy’
(And I passed the Coast Guard classes for pleasure boaters - including navigating with charts and compass alone - at the age of 12.)
I wouldn’t know about all of this nautical stuff. I am a pilot and I drive planes for a living. I also drive a motorcyle. Been known to drive a weed-wacker occasionally.
Can you drive a hard bargain
Can you drive a hard bargain
I used to be able to drive grade-school teachers insane.
This Dave Crossman guy is an analyst - an ANAYLIST! - for a firm that owns 370,000 Toll shares.
What does it take to be deemed an analyst? How much analyzing does it take to determine that Toll and the other home builders are going down the tube?
“What does it take to be deemed an analyst?”
Printed business cards.
Printed business cards.
good one
What does it take to be deemed an analyst?
watching CNBC and following Crammer.
That makes a bunch of my co-workers analysts as well. I should go tell them.
“It’s like driving the Titanic, things don’t turn on a dime,’’ said Dave Crossman
You have to love the reference to the Titanic…freudian slip?
Oh yeah. I wonder if Dave’s stuff is in cardboard box yet? His employer ought to kick him to curb for that absurdity.
Dave’s not here.
Kind of gets you by the boo boo don’t it!
No, man, this is Dave!
I just found that record at the Goodwill. Brings back some amazing memories. I’m sure you know what I mean.
The ship has hit the fan.
Da-ave…
It’s me DAVE, I got the Toll stuff.
Wait a minute - wasn’t Bob Troll the same clown that at the peak of the Bubble proclaimed a “new age” in housing, one where “prices would just keep going up” and “the next generation would have to live with their parents until well into their 40’s before finally paying over half their salary each month for the mortgage on a cruddy starter condo in a bad part of town.” or something like that?
Don’t you just hate it when reality interrupts the dystopic future that the Powers That Be have planned for us? Hahaha!
“We’ll reach the point Europe reached 20 years ago, where families pay 45% of their income on housing and married couples have to live with their parents for years before they can afford houses,” he says. “Prices will keep going up in double digits for years.”
http://money.cnn.com/magazines/fortune/fortune_archive/2005/04/18/8257004/index.htm
It was fun to read that article. Basically, Toll’s strategy was to out-lawyer the NIMBYs so that he could build zero-lot-line McMansions on desirable property that no one else could get permitted for construction. Then sell the houses at a huge markup based on scarcity.
It’s ironic that NIMBYs did his work for him by preventing competition from other builders, and in exchange, the NIMBYs got the worst possible outcome of poorly built cookie-cutter McCrapBoxes all in a row, with bankrupt FBs leaving their swimming pools untended to breed mosquitoes.
I wonder if the NIMBYs will learn anything from this experience?
So maybe all your base is *not* belong to us?
Maybe all our bass have begun to slap?
Does anyone remember when developers used to live in the communities that they built? And houses had both front and back yards? And low-income housing was for people with low incomes, not for millionaires?
It’s about time for the dead cat to bounce off the hot tin roof…
http://www.marketwatch.com/tools/marketsummary/
February 6, 2008 2:09 P.M.EST
BULLETIN
Investors rethink the plunge
On the heels of the steepest blue-chip decline in a year, U.S. equity indexes seek to get reacquainted with the plus column Wednesday.
Or is the saying “dead cat plunge through the hot tin roof”?
Top loser professions of the housing bubble:
aromatherapy
candle-making
doggie spas
face-painting
Any more?
Realtor®???
Real Estate Agent
Life Coach
Any form of mortgage advertising (email spam, countrywide commercials)
Mortgage brokers
AE’s
Loan processors
loan sweat shops
Divorce Attorney( clients can’t afford to sell the house!)
Winners..
Credit Repair
BK Attorney
Eviction Servers
Foreclosure County Clerk
Sheriff Office
Home Depot Lumber Dept(need boards for the windows)
It is my understanding that the NAR is asking agents to now refer to themselves as ‘Real Estate Counselors’
I’m sorry but I have that Tradmarked.
Real Estate Counselor (TM)
If they use it, I’ll sue. They need to stick with Realtors (TM)
Real Estate Coach
No joke, I wanted to find out what exactly she “coached” but she is related to a friend of mine.
scrapbooking
house staging
feng shui
yoga studio
Sounds like the lady with the knitting shop might have over HELOCed into Yarn inventory as well. You know things are tough whenever the yarn shop in the new high end retail shops can’t make it.
life coach
Japanese Koi Pond/Water Garden Sales & Installation
The future of Koi:
GRILLED KOI
1 koi
Char-grill seasoning
Lemon pepper
Garlic powder
Salt & pepper
Soy sauce
Lime slices (optional)
Cut 2 slits across koi on both sides. Sprinkle one side liberally with soy sauce, salt, pepper, char-grill seasoning, lemon pepper and garlic powder. Place 2 or 3 lime slices over fish. Place fish, seasoned side down, on basket for grilling. Season other side of fish the same as the first side. Clamp fish in basket and grill over the charcoal about 15 minutes on each side or until fish flakes easily.
I’m fond of squirrel fondue.
do you put turtle urine in the fondue?
Koi (carp) is pretty good. Don’t ever eat it raw though. Fresh water fish have lots of parasites.
Lots of bones however.
So does real estate.
Carp Diem
Funny story about KOI,
one late evening in the 80’s while driving ventura Blvd past my fav sushi rest..I saw a glow, sort of like a Fire, which isn’t good cause there is quite a fire hazard in the Studio City neighborhoods, and I pulled over to see the cops pull up too and go to the back of the restaurant which was closed.
Turns out a homeless guy caught himself a Nice expensive dinner and was roasting a KOI or two.
Ingenuity.
Wasn’t sushi anymore.
Arson Coaches are booming.
Good one, Tom.
Not just booming - they are on fire!
They are hot to trot.
Web Animator for the dancing man/woman/cat/piggy bank/gay cowboy banner ads for lower-my-bills type companies.
Nah, those folks’ creations now advertise online degrees.
Only someone who would get mortgage from one of those ads would try to get a degree from them as well.
There should be a study…how many FBs will go on to graduate from the university of the dancing gay cowboy?
Hummer/BMW/Mercedes salesman
Winners include:
Foreclosure lawn sign makers
Payday loan kiosks
Forensic accountants
The Dunkin Donuts next to the unemployment office
My sister has a dog-walking (and picking up dog shit) business in Northern VA that is apparently going gangbusters.
i saw a van this morning in nyc that is the pet limo
people spend lots of $$ on their pets
my losers include
realtors
mtg brokers
contractors
car salesperson
life coach-lmao
winners-
lawyers-always the lawyers
i am thinking of investing in my own home staging business
anyone want to invest?
“My sister has a dog-walking (and picking up dog shit) business in Northern VA that is apparently going gangbusters.”
That one’s interesting. Presumably it’s because the other half had to go get a job, or one or both are working longer or two jobs.
My son (nine y.o. at the time) made several hundred dollars walking dogs over one summer. I keep trying to talk my niece into starting her own house/pet sitting business. Instead she’s applying for work at Disneyland. Honestly, I’d rather pick up dog sh!t than work at the happiest place on earth. Pet/house sitting is a great side job for young people. You can get away from your family for a while, it’s tax free income, your supervisors are gone on vacation… it sounds dreamy to me!
Fung-Shei consultant
Recently-hired municipal employees (clerks, county-program officers, teachers, public-safety - cops, ems, firefighters). As property tax rates falter, jobs will be be cut, and those without seniority will be the victims in many cases.
And, in some cases - public safety folks making big money off of heavy overtime will see the overtime gravy train shut down. (back to working private security at nightclubs on the weekends, I guess)
The entire wedding industrial complex.
I think the life coaches will last a little longer than you guys think, at least the ones that specialize in the truely rich. Rich guys who think going to a psychologist is girly and rich women who think a “coach” is more successful sounding will still use them as they either lose their jobs or have angst over laying off their colleagues. If there is a segment of this job that is really concentrating on the middle middle class, they will be gone much sooner, though they might get used for job hunting/strategizing for a few months.
RE: Top loser professions of the housing bubble:
I think one poster here mentioned the existence of legions of female Benz driving “CLOSET ORGANIZERS” in AZ!
Party planner
Personal Chef (the rich will always be with us, but this kind of stuff was beginning to extend down into the upper-middle class)
Personal Trainer
Lawn Services
Any more?
Granite counter top installer
Sub-Zero appliance salesperson
Flat screen TV installer
Top WINNING profession (for the next decade):
-Tattoo removal
Toll Has Seventh Straight Drop in Quarterly Revenue.
From the article………….
“It’s like driving the Titanic, things don’t turn on a dime,” said Dave Crossman, an analyst at Kirr Marbach & Co. in Columbus, Indiana whose firm owned about 370,000 Toll shares as of Dec. 31. Crossman commented before the report.”
Did this ship sink?…….I thought so
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aBeyCgqv5e64
No, they just hit an iceberg and are taking on water while all the bull investors inside are listening to the beautiful music while trying to keep their drinks from sliding off the tables.
“It’s like driving the Titanic, things don’t turn on a dime,’’ but they do sink like a stone. What kind of moron compares his holdings to a famous disaster?
“You better start swimmin’
Or you’ll sink like a stone
For the times-they-are-a-changin’”
Are you suggesting that Toll’s stock is going to rally today, now that they have thrown the kitsch-and-sink into their balance sheet?
http://www.marketwatch.com/tools/quotes/intchart.asp?symb=TOL&time=12&freq=1&comp=&compidx=aaaaa%7E0&compind=&uf=0&ma=&maval=&lf=1&lf2=&lf3=&type=2&size=1&txtstyle=&style=&submitted=true&intflavor=basic&origurl=%2Ftools%2Fquotes%2Fintchart.asp
What entity set a $20 floor under Toll’s stock price post-August ‘07 credit crunch? (I duly note the floor caved in recently…)
This article shows IMHO why that upgrade yesterday made no sense. The excuse was that lower interest rates will motivate buyers, yet Toll’s average sale price is almost $650,000. Who can afford that even with lower rates, especially if you actually need 10-20% down now??
Well, you see, we can get you in a neat negative amortization, faked income, 40-year, pick-a-payment, no points, no money down loan and… oh, wait - did you say DOWN PAYMENT NEEDED?! Ack… um… can we just put that on the credit card and make the minimum monthly payments on the down payment? That’ll work - right?
What’s a “canceled house”? Sounds terrible, whatever it means…
Toll’s homebuilding revenue falls 22%
By Greg Morcroft, MarketWatch
Last update: 6:24 a.m. EST Feb. 6, 2008
LONDON (MarketWatch) — Toll Bros. doesn’t see any end in sight to the U.S. housing market’s woes as the luxury homebuilder said Wednesday that first quarter home-construction revenue fell 22% compared to the same period last year.
“The housing market remains very weak in most areas. Based on current traffic and deposits, we are not yet seeing much light at the end of the tunnel,” said Robert Toll, chairman and CEO.
Horsham, Pa.-based Toll (TOL: Last: 21.87-0.48-2.15%
4:01pm 02/05/2008) also said its backlog fell to $2.4 billion, down 42% from the first quarter of fiscal 2007, as the number of signed contracts on homes fell 46% from last year. In addition, the average price of a house sold by Toll fell, while the average price of canceled houses rose.
http://www.marketwatch.com/news/story/toll-says-sees-little-relief/story.aspx?guid=%7BDECAB947%2D20CA%2D4D41%2DB30E%2D6E6CE0CE3870%7D
Well I just changed my party registration from Republican back to Libertarian. Ron Paul got only 4% of the votes in the Arizona Republican Primary. McCain and Hillary will end up the nominees and we will have to march on the streets again within the next 2 years against amnesty for illegals.
Granted, Libertarians are for open borders…BUT they are against any taxpayer assistance to anyone. McCain and Hillary will rob all of the legal citizens to pay for the illegals’ health care, education, mortgages, and food.
“In order to become the master the politician poses as the servant.” ~Charles DeGaulle, 1969
Yep, bill, I’m holding a barf bag. McWho and Hillary. That just says it all, don’t it? Not real happy with my fellow citizens right now and thinking they’re gonna get what they deserve, except I may get it right along with them. Paul supposedly only got 3% of the Florida vote, which is BS considering the support he has in this state.
Many still do not know who Ron Paul is. With lack of media coverage I’m not surprised.
http://people.ronpaul2008.com/campaign-updates/2008/02/06/a-scorecard-you-wont-find-on-fox-news/
Paul has $20 mil, more than any other Republican candidate. Why isn’t he spending it? I have not seen one Ron Paul commercial. What’s he saving the money for?
I’ve been seeing quite a few in Arkansas lately.
He’s deluging all the caucus voters here in Montana since last year, but then there were only 1800 of us. Cheap date!
Hey Scooby Doo will beat out what we have now. I’ll take whatever we get and be greatful.
edhopper, that question was asked by Kudlow to a RP campaign mucky muck. His answer? Lack of media coverage means that the $28 million does not go far compared to if McCain had that same $28 million. Media coverage is worth $ millions of uncontributed dollars, ya know.
Maybe RP is saving the $$ for a third-party run.
I’m probably going to be slammed for daring to chime in with my two cents, but here goes. And, no, I’m not going to respond to anyone pissed off by my points.
I’m a Hillary Clinton supporter and already voted for her in California. I do not see the media as selecting her - rather, they are doing everything they can to coronate Obama, a candidate the corporate media probably perceives as a weak, easily controlled candidate if he should win the white house or a candidate that can be steamrolled by a republican, both of which I think are not necessarily true.
I think in order to get back to a strong economy we have to balance the budget, but that means raising taxes on the rich - the top 1% - too bad Bill Gates has to pay more, but the rest of us 99% can’t afford to pay more. The US provided the basis for these fabulously wealthy people to get fabulously wealthy, they owe us.
Again, not going to get in an argument with anyone over this - you all have your opinion; I have mine.
Having said that, I find Ron Paul refreshing and agree that he deserves to be heard on the same platform as the other candidates. I don’t agree about the gold standard or his other economic points, but these theories are worth discussing. His stand on ending overseas military posts as well as ending the war is something everyone needs to hear.
Again, I’m voting for Hillary, but I hope Ron Paul runs in the general election as a third party candidate. Whether that ends up hurting or helping my candidate - that’s irrelevant - these ideas should get a national platform.
Hillary supporters probably know that to achieve Universal Health Care she will enforce mandates to ensure total compliance. She told ABC and Reuters that wage garnishment using IRS enforcement mechanisms will ensure that every “working” American pays up.At least the W-2 crowd. This seems fine to Hillary supporters,but I say it stinks.
John Insane and the Hilda-Beast (aka Hill Billy) are the chosen ones for us - great! Open borders, illegals all over, war without end - what more could you want?
Bill - I’m disappointed, too. Here in central Florida I have been seeing Ron Paul signs for many months and at our polling place he had the most and biggest signs. But the media is determined to bury him.
I’ll put him down as a write-in, next November. Piss on ‘em.
wachovia knew of theft:
Last spring, Wachovia bank was accused in a lawsuit of allowing fraudulent telemarketers to use the bank’s accounts to steal millions of dollars from unsuspecting victims. When asked about the suit, bank executives said they had been unaware of the thefts.
But newly released documents from that lawsuit now show that Wachovia had long known about allegations of fraud and that the bank, in fact, solicited business from companies it knew had been accused of telemarketing crimes.
http://tinyurl.com/2×5c3l
Link did not work for me.
http://www.gadsdentimes.com/article/20080206/ZNYT01/802060373/1019/NEWS01
got wheat?
U.S. wheat prices surged to more than $10 a bushel on Chicago futures exchanges Tuesday, while hitting a record on the smaller Minneapolis Grain Exchange, as Canada reported tight stockpiles and millers scrambled for supply.
Overall, wheat prices have doubled since last June at the Chicago Mercantile Exchange (CME), which owns the Chicago Board of Trade. Prices have been pushed higher by surging world demand and bad weather in some major producing nations.
http://tinyurl.com/yrcq9w
The deflationistas are not gonna be happy about this latest trend…
Increase in money supply is inflation; rising prices is a symptom. The article tells you that there are external reasons for this price gain. We may very well have inflation at some point, but this article doesn’t prove it.
So wheat is becoming more expensive because of external reasons instead of inflation. Got it.
But then, what about oil and gas? There are external reasons for the prices rises there too — more demand, lower quality sour crude, security premium, expensive extraction, etc… that’s not inflationary either.
Um… yeah. There are some prices that will rise even in deflationary times. Less money supply doesn’t mean we stop heating our homes. Prices of necessities aren’t necessarily good inflation/deflation indicators. At some point, if the economy slows down enough, demand will go down and even prices of necessities may go down, but that’s far down the line.
Necessities are overrated.
There’s no argument that we have been in an inflationary spiral, whether you are considering prices of everything or the expansion of credit. What we all want to know, is if the price of everything we want is going to come down, whether our savings is going to scream toward worthless or fortune. Personally overall money (credit) supply means little to me except as an indicator. IF the inflationary spiral is to stall or reverse, we won’t know for a while. As jas pointed out, inflation usually still has a head of steam into the beginning of a recession. Just going to have to be patient and watch it unfold. Things are not headed the way they were seems a sure thing.
“Increase in money supply is inflation”
Correct and the money supply increased by 800% over the last 7 years Without being spent. These dollars are looking for a home and it is commodities.
Buy what China buys, sell what China sells.
You can bet every wheat farmer on the planet is planting every inch of soil he can access and upgrading the quality of insecticide and fertilizer and anything else that will increase crop yield. These actions will more than offset todys tight market and cause prices to fall in the coming months.
Yep, exactly right. Thank you for jumping in.
This is why there is perennially a boom-bust cycle in agriculture.
Last year many fields around here were to be switched to corn production, but the supply of seed ran out.
COnagra and Monsanta ran out of bad fake seed?
…they shoulda used their pull w/Shillary. She’s intimate w/Monsanto……not to mention WalMart, where she may be able to use her former power to create a new selling niche for seeds
Let’s hope you are right. Because if we have a bad weather year, it could be famine.
Not a bad time to consider putting away a year’s worth of food…
(disregard, if you don’t eat)
Already way ahead of you, Lad. Or at least keeping up. Not gonna happen, but if it does…
” … if we have a bad weather year, it could be famine.”
1. The wheat market is global. The weather would have to be bad everywhere to cause a shortage in the wheat harvest.
2. Wheat isn’t the only crop people eat. If there arises a shortage of wheat then high prices will drive consumers to alternative food sources.
Spoken like Greenspan. If bread gets too expensive people can eat tree bark, or leaves. Hedonic adjustment is a great weight loss plan.
Longpig anyone?
I would love to know what grain crop has not gone up.
Look at Board of Trade grain prices, call Bunge or ADM and get prices on spot grains. Just be grateful that US meats do not meet Asian purity standards.
All grains are petroleum products.
US hog exports to Asia are doing well now.
‘November Exports Continue Strong, 2008 Export Forecast Increased
U.S. pork exports for November 2007 were 339 million pounds, 16 percent above November 2006. For the January-November 2007, cumulative exports are 2.8 billion pounds, about 4 percent above the same period in 2006. The top five destinations for U.S. pork products in November were Japan, China, Mexico, Canada, and Russia. Together, these five countries accounted for more than 76 percent of U.S. exports in November.
On the strength of expected low prices from plentiful domestic pork supplies, and a continued competitive U.S. dollar exchange rate, USDA raised the 2008 pork export forecast to 3.7 billion pounds, over 17 percent above the 3.1 billion pounds forecast for 2007.’
http://www.thepigsite.com/articles/7/markets-and-economics/2142/us-pork-outlook-report-january-2008
http://www.nytimes.com/2008/02/05/health/05pork.html?em&ex=1202446800&en=3ddfd008c331e1ef&ei=5087%0A
NYT A medical mystery. Pork Processors Plant, Mayo clinic, and very very sick workers, pigs brains.
Demand is increasing faster than supply. Asia will buy all the wheat we can produce, and more.
Then sell it back to us in contaminated form.
This is partly due to farmers switching to corn, hoping for an ethanol boom. If that peters out, you’ll see that land go back to other crops. My parents grow hay, and they’ve had a great year, thanks to ethanol.
I read that local ranchers are selling bull calves for whatever they can get for em’, as the cost of hay being so much, doesn’t pencil out, as far as letting them reach full Bullhood.
I feel the current run-up in wheat prices is partly based on supply concerns and partly a symptom of infestors looking for returns. Wheat carry over is at an all time low in the U.S. and world supplies are also tight, especially for hard red winter wheat. Our wheat crop will be the next harvested in the world. Watch the weather in the Plains states over the next couple of months (mostly Kansas). If we receive precipitation and a bumper crop is anticipated, look for prices to fall off quickly. If it remains dry or we have a late freeze who knows where prices could go. That said, wheat can be grown all around the world. Farmers can adjust acreage according to perceived demand, but you have to remember we can only do what our climate allows. Here in Texas I can do nothing to increase my wheat acreage until I plant again next fall. The same is true for all winter wheat across the northern hemisphere. Spring wheat areas can still adjust acreage, and the southern hemisphere can adjust their winter wheat acreage. It may take a while, but we will produce ourselves back into a surplus of wheat.
A commodity bubble. People are looking for safe investments and think commodities is the next big “thing”.
All the farmers will go out and start growing and pretty soon you will have an over supply. They say people have to eat. Well… they do… but they will cut back and eat Alpo if they have to.
I’m sure climate change has nothing to do with a world-wide shortage of food.
All climate is local, didn’t you hear?
got wheat?
More benevolent government intervention effing up a market. If we were allowed to import ethanol freely from Brazil, grain prices would be lower. Instead we increase import taxes on Brazilian ethanol and subsidize/stimulate corn production. We are great at growing wheat. Our climate supports wheat. We should grow more wheat. Brazil is great at growing sugarcane. Its climate supports sugarcane. Brazil should grow more cane.
Hey! Does Brazilian ethanol come from sugarcane dross? I support ethanol from sugarcane waste, or, hell, cane full stop. I bet sugar burns like sixty and not man nor beast needs to be eating it.
Maven - has anyone done a study on the efficiency of shipping in ethanol, relative to the cost and upkeep of the vessels, storage, transportation and delivery once landed, etc.? Everything I’ve read points to a colossal miscalculation of ethanol’s benefit as a fuel relative to the direct and indirect cost of producing it. If it is cost-effective to produce it in Brazil, does it necessarily follow that it is cost-effective to get it into the fuel tank of a car in Colorado?
Dallas neighborhood trying to keep eyesore McMansions out tries to recall their city councilman, a former realtor, who sided with builders.
http://www.outwithsheffie.com/
this loser defeated a good friend of mine in that race. She is a member of Preservation Dallas. Nuff said.
Voters made their bed, are having to lay in it now and don’t like it. Too late.
Reminds me of Nov 2000/2004. Too bad Sgrillary is likely to replace thr monkey.
Shrillary
Lie. They are having to lie in it now.
Beware the L-words “loose” and “lay.”
Use “lose” and “lie” instead today
And every day you type online.
Remember this and you’ll do fine
Unless you chance to type an “it’s”
Where “its” should be and give us fits,
Or else in heedless rush to spew
You type a “to” instead of “too.”
“Unbridled pessimism”
http://tinyurl.com/2vozwx
Is that the antidote of “Irrational exuberance”?
This could be epic, if things go loony in other markets, and the Asiatics have to play catch up on Monday…
“Markets in China, South Korea and Taiwan were closed Wednesday through Friday for the Lunar New Year holidays.”
let me downgrade you:
SAN FRANCISCO (MarketWatch) — Standard & Poor’s said on Tuesday that it may downgrade bank ratings because of trouble in the $2.4 trillion bond insurance business.
“Bond insurers are suffering as a result of their roles as guarantors of mortgage-related securities, and downgrading them could affect all markets in which they are active, including the municipal bond, commercial mortgage-backed securities, and other structured finance areas,” Tanya Azarchs, a credit analyst for S&P, wrote in a note to investors.
http://tinyurl.com/yu4w9v
“you qualify for a free downgrade!”
LOL
Cripes aladin - does this stuff just come to you instantly? You’ve been at the top of your game the last couple of weeks. Pretty soon you’ll have your own chapter in Ben’s book.
I’m blessed/cursed with a photographic memory, and it only takes a word or 2, to set me off.
Aladin. That`s funny !!
This is what passes for “quality” McMansion construction in my hood. This place apparently is a $1.2M house. Look at the cheap windows and fiberboard all over it.
http://bp0.blogger.com/_w5kidd0VGd4/R3qgOcE3X7I/AAAAAAAAAY8/KgXaeTV_2zM/s1600-h/DSCN1500.JPG
This is sensationally awful!
However, we have Long Island so you must bear your crosses alone.
If houses could talk, what would that one say?
“please don’t hate me cause I’m fugly”
I wonder if they will keep the chain link fence once construction is done. If I were the near-side neighbor, and it was on my property, I’d keep it and make them look at it.
Then again, they’ll probably ring the property with one of those hideous formed-hollow-plastic privacy fences in blazing bright plastic white. (Someone put one of those up near my neighborhood where everyone uses split-rail, so it really sticks out as a big white blot onthe landscape. The local kids have been knocking out panels at night. Perhaps egged on by their parents.)
I had the opportunity to be in DC around the time of Reagan’s death. There was tons of construction going on in Arlington and Falls Church at that time and every single home that was not yet completed looked like the one in your picture.
That house should last at least 5 or 10 years.
Home builders should be required to show photos of under construction of the properly. If done well, I’m sure people would easily pay 10% to see that their house isn’t a POS under that wallboard or plaster.
Yep, the modern McMansion - the house and your finances after buying it will fall apart at about the same time. You’ll get nothing and like it!
Ecery condo/SFR development under construction in westerb suburbs of PDX looed like that. Add in the rain.
Isn’t that how all McMansions are built now? Fiberboard and vinyl windows have become the norm (where’s the Tyvek?).
I would expect better on a million dollar house however
Chicago is ringed with that kind of construction too. And here they stand out in the snow/slush/rain - sometimes the loosely stapled Tyvek flapping in the wind.
Once saw a subdivision after a snow storm. At least a foot and a half of wet snow sitting for days on the exposed wood floors and beams. The workers just walked through it and kept nailing as their steps drove the moisture into the untreated wood.
It’s a good thing for HBs that today’s FBs know absolutely nothing about proper construction methods - just grandiose entrance ways and granite.
RE: It’s a good thing for HBs that today’s FBs know absolutely nothing about proper construction methods
I’ll bet there are scores of houses constructed with green wood.
So there goes the drywall joints!
Just a mess to repair.
How should it be built? Plywood vice fiberboard? (Good info!)
So, what should go on a house over the frame?
Well, I’ve seen some houses around here that only have styrofoam and then the vinyl siding! Yikes! That’s from the 70’s and 80’s. Cheap construction can be had in almost any decade you choose. The most recent 5 years probably provides a bonanza of it, though.
Anyway, plywood is better to use for typical frame construction if you’ll be using siding, so I have heard. Add foam layers if it’s a cold climate. Whatever you use, you really ought to wrap it ASAP to keep driving rain from soaking it.
This is what passes for “quality” McMansion construction in my hood.
TXChick lives in a ‘hood? You gots a crew? You be kickin’ it wit da homies?
Built by Toll, right?
CityBoy Fun:
I was riding the elevator up this morning. There was a little Asian woman in the elevator with me. Much of our building is rented out by a major Japanese corporation. She looked at the little TV screen in the elevator, and out of the blue said, “I wonder if stock market goes down again today.” I was shocked. She said, “it’s so bad”. I wanted to say, “well it is just another over-priced, over-leveraged asset class” but I didn’t. I just said, “it sure could go down again”.
The woman looked at me and added, “it was down 350 points yesterday”. I paused for a moment and said, “actually, it was down 370 points yesterday”. The elevator doors opened and she got out. I said, “have a good day” and she returned the greeting with a smile. Something tells me that all the secrets are leaking out to Joe 6Pack and Salli Sushi.
I bet Olympiagal is proud of me for setting the record straight.
You didn’t add “bee-yatch” as a gratuitous honorific?
Growing soft in your old age, you are.
oft usually can’t ‘grow’….
Salli Sushi…..
NYCityBoy, I can honestly say, your complete lack of “PC acceptable” comments are one of my guilty pleasures.
It reminds me of talking to my husband’s gramps who the family avoided taking out in public for fear of public flogging.
I thought he was hysterical.
If you ever want to have fun in a crowded elevator full of strangers…
Walk in and face the crowd, instead of looking towards the doors.
This will unnerve most of them.
If someone ever did that while I was in the elevator, I would also turn around quickly just to freak everyone out even more.
There’s a “safe” distance in the USA between people, and as long as you are 10 inches away from the back of somebody’s head, it’s ok. but being 10 inches away from somebody’s face is a whole different kettle of fish.
I find that many people do not understand what a proper distance in public is. Also ,it’s annoying to hear people shout/talking at each other or talking loud on cell phones .
People should understand that” Freedom” doesn’t mean your entitled to invade other people’s space and force your “trip” on them .I wish that parents ,or the school system ,might teach more about manners . Also, why do some people think friendship means that they can drop by anytime without notice and dump their current problems on you , but they have a 2 second attention span about hearing anything about your life. Sorry …..I’m in a bad mood .I know a guy who just found out that he has a tumor the size of a grapefruit ,and this guy won’t even ask for any help in spite of needing it. This guy (with the tumor ) has a wife who can’t drive or talk because she had a stroke a couple of years ago . Now that guy has real problems .I guess i just needed to vent .
Wiz…
You ought to avoid French Canada like the plague.
Space violation is an art form, there.
it’s due to the extreme oversexiness caused by the ingestion of poutine
A lot of people have no boundaries at all. There is a family down the street, whose children run wild in the neighborhood, playing war games in other people’s yards, flower gardens, hedges, porches, driveways, etc. Their dog is always loose as well, and he runs around chasing and barking at passing dogs. The mom, who likes her wine, will come out of the house in her robe and perfunctorily apologize as she yells her dog in and look martyred because we had the nerve to walk our dog past her house. I want to shoot them all. Is that wrong?
“Also, why do some people think friendship means that they can drop by anytime without notice and dump their current problems on you…”
After 50 years of watching families on TV who apparently never lock their doors and all live next to 5 sets of “come and go as you like” neighbors, what can one expect?
I want to shoot them all. Is that wrong?
hmmm…shooting with a firearm may be a bit over the top. You may wish to lightly taser them only.
There’s something happening here
What it is ain’t exactly clear
There’s a man with a gun over there
Telling me I got to beware
I think it’s time we stop, children, what’s that sound
Everybody look what’s going down
Good tune
For What It’s Worth, Buffalo Springfield
Dude - the issue is whether you got her number. You left that out.
She looked at the little TV screen in the elevator
I need to get to big city more often. I have never seen an elevator with a TV in it.
I guess it’s nice because it gives you something to stare at while you’re in the elevator, but the content is not that great. Half the screen is an advertisement and the other half is a 20-word blurb about some world event - and you probably don’t care for 75% of them. Britney Spears got drugged by her manager?!? OMG!
I bet Olympiagal is proud of me for setting the record straight.
I sure am, NYCity! I greatly admire how you and the Brutal Truth are such good buddies.
Although I’m rather surprised you didn’t make the simple little Asian lady cry, just by accident, you know how you do.
The Boom Was a Bust for Ordinary People
http://www.alternet.org/workplace/75944/
But hellooo, we’ve had brisk growth for the past few years, as the president has tirelessly reminded us, only without those promised increases in personal income, at least not for the poor and the middle class. According to a study just released by the Economic Policy Institute, real wages actually fell last year. Growth, some of the economists are conceding in perplexity, has been “decoupled” from widely shared prosperity.
There’s plenty of news about international economies decoupling from the American economy, but few news stories or talking heads deal with this internal decoupling.
Let’s hope internal coupling continues. That is prices of imported goods rise, profits fall, interest rates rise, and the better off take a hit — but J6P keeps his job because labor force growth is slow. It would be unfortunate to miss out on the gains but take the losses.
Worker Productivity Grows, Hours Cut. Fear is a great motivator.
“Feb. 6 (Bloomberg) — Worker productivity in the U.S. grew more than forecast in the fourth quarter as companies cut employees’ hours at the fastest pace in almost five years.
Productivity, a measure of employee efficiency, rose at an annual rate of 1.8 percent, after a 6 percent pace in the third quarter, the Labor Department said today in Washington. The median forecast in a Bloomberg News survey was for a 0.5 percent gain. Labor costs rose less than forecast, the figures showed.”
Barbara Ehrenreich is an interesting author. I read her book “Bait and Switched” regarding the perils of being a middle aged white collar worker. I know far too many people who could have been sample cases in that book. And we wonder why so many people went for get rich quick schemes like real estate.
Her “Nickeled and Dimed” is also good. It deals with a step down on the economic ladder compared to Bait and Switched.
Being an occasional voice of doom, I learned awhile back to keep doom on the down low, when talking to friends…
But lately, they’ve been out-dooming me.
What’s up with that?
“If you are sufficiently negative then bad things won’t happen.”
There are actually people who believe that. It’s extraordinary.
“Cheer up, things could be worse………sure enough, I cheered up, and things got worse!!!!!”
My theory is this: being a pessimist or a cynic works out fine since I am either proven right or pleasantly surprised!
Pondering the Mess. My father approached life the way you do .My father use to say that if things worked out better than expected it was a nice bonus. Come to think of it ,my Father was aways pondering the mess …just like your name .
“”Everything is going to become unimaginably worse and never get better again” — Vonnegut
Just kidding! I have to tell myself that a few times a day to counteract the “It’s all good!” attitude in here in SF and give myself the happy medium. Better than meds!
MrBubble
PS: Was I in hell with my SKF psn during the run-up? Oh, yes. Did I do the “Humpty Dance” when the financials were downgraded this week? You bet your a$$. Just making sure that I don’t “forget about the losses and exaggerate the wins”, with apologies to Jackson Browne.
well sometimes that works. Hopefully. Sort of like Murphys law.or ?
Pretty easy aladinsane. They’re merely parroting the MSM mantra. If MSM sez things are wonderful then dammit….. everythings great.
Sounds like a bottom for the stock market. If *everyone* thinks things are bad, then the market usually goes up. However, my gut tells me something ahistorical is about to happen.
Yeah it’s weird - unfortunately I think this is one time the MSM has it *right*.
It’s become in vogue to be contrarian lately. So personally I think I’ll go against the mainstream and be non-contrarian for a while.
I think the problem is the MSM and the public really think things are bad. Even here on this forum the reports of empty stores, etc.
I don’t really think things have slowed down at all. At best we undid 9 months of what was very fast growth. We still have a LONG WAY before people have actually seen any significant change.
I traveled around in an RV during the boom years, and believe it or not, there were famous malls that were sometimes empty. Like waves on the ocean, sometimes things just interact that way.
Real things: Car sales have dropped, but man, didn’t we have enough new freaking cars since 9/11 and the ‘Employee Price Sales’? Grocery prices have gone up but only in the past 2 years. the housing market growth has clearly stopped and sales have found to a halt…. but prices still have to drop. And foreclosures are only now returning to a normal level… the flood of them hasn’t even started yet.
We were at 90MPH accelerating in a train…. all that has happened is the acceleration has stopped suddenly. Maybe we have slowed down to 88MPH. I think when things hit 60MPH we will be more widespread problems. Of course, always a chance this is the beginning to the end of the USA empire… where we smash into a way at 80MPH (stock market crash, civil war or other widespread unrest).
We ain’t seen nothing yet. I think the MSM and others only like to think _this is bad_ as now the 800K house on 50K income party is over. What a joke, it can get a LOT worse.
Strange things can happen when you approach 88 mph.
Gloom-and-doom on Main Street gives great hope to Wall Street insiders for the future opportunity to snap up assets at fire sale prices.
Dooministas!
“But lately, they’ve been out-dooming me”
My $.02 analysis is we (the bloggers) have been processing this stuff for years. This “hard times” concept is new to them and coming at them fast.
We’re sitting back with a decent set of expectations for what comes next munching on our popcorn. (Thanks Neil)
Olive oil and popcorn popped in a pot over an open flame, is the bomb.
Just like Mom & Dad used to do! Yum!
really starting to feel anger these days.. Just because I told you what was going to happen, sold my house and told you not to buy since 04 now its my fault! It’s better to say looks like a big turn around this spring and change the topic.. or houses can’t get much cheaper.. then to hit them with the facts.. People hate people like us these days.. you know the Know it alls!
Morning yuck. Hot Ladies Talking Money With Bald Dudes
http://bigpicture.typepad.com/comments/2008/02/hot-ladies-talk.html
“It turns out that you owning a house was a mistake. Well don’t worry — a lot of us make mistakes.”
Jon Stewart spoofing the housing bubble is one of the milestones I have eagerly anticipated for some time now.
Next up: Desperate Housewives comes back after the writer’s strike with an episode where the foreclosure crisis hits Wisteria Lane.
Really? I can’t wait to see which one of those bimbos gets tossed out on her silicone ta tas. I hope it’s Brie. She’s had so much work done on that face, she is actually starting to look like the cheese that is her namesake.
Private tutoring
AFX News Limited
Bernanke, Senator Dodd to meet on economy on Wednesday
02.05.08, 11:52 AM ET
http://www.forbes.com/markets/feeds/afx/2008/02/05/afx4616315.html
“Bernanke, Senator Dodd to meet on economy on Wednesday”
Oh, boy. There’s your trouble, right there.
Is there an index I can short America?
I saw you accuse someone of being an america hater the other day. Hmm.
If I have to continually watch this country make fools out of itself, I might as well make a buck or 2, off of it.
“Not an America hater, A Yankee hater. Where I come from everybody hates the Yankees”
old but appropos:
“Definition of a Yankee - (1) to a foreigner, an American; (2) to a Southerner, a Northerner; (3) to a Northerner, a New Englander; (4) to a New Englander, a Vermonter; (5) to a Vermonter, someone who eats apple pie for breakfast.”
Definition of a cheesehead…
sore loser, rancid with resentment.
LOL
I am not a sore loser, nor rancid with resentment. I am a cheesehead
Camem-bear?
Currency trading.
And there are reverse splits. No reason the Euro can’t go to 4 to 1 from 1.5 to 1.
Not that I would count on that…. but it is possible.
Can a day please pass without a member of the Fed opening their mouth? Just 24 hours please.
How else are we gonna know they’re lying?
http://www.nypost.com/php/pfriendly/print.php?url=http://www.nypost.com/seven/02052008/postopinion/opedcolumnists/the_real_scandal_243911.htm
PERHAPS the greatest scandal of the mort gage crisis is that it is a direct result of an intentional loosening of underwriting standards - done in the name of ending discrimination, despite warnings that it could lead to wide-scale defaults.
At the crisis’ core are loans that were made with virtually nonexistent underwriting standards - no verification of income or assets; little consideration of the applicant’s ability to make payments; no down payment.
Most people instinctively understand that such loans are likely to be unsound. But how did the heavily-regulated banking industry end up able to engage in such foolishness?
From the current hand-wringing, you’d think that the banks came up with the idea of looser underwriting standards on their own, with regulators just asleep on the job. In fact, it was the regulators who relaxed these standards - at the behest of community groups and “progressive” political forces.
Flexible lending programs expanded even though they had higher default rates than loans with traditional standards. On the Web, you can still find CRA loans available via ACORN with “100 percent financing . . . no credit scores . . . undocumented income . . . even if you don’t report it on your tax returns.” Credit counseling is required, of course.
Ironically, an enthusiastic Fannie Mae Foundation report singled out one paragon of nondiscriminatory lending, which worked with community activists and followed “the most flexible underwriting criteria permitted.” That lender’s $1 billion commitment to low-income loans in 1992 had grown to $80 billion by 1999 and $600 billion by early 2003.
Who was that virtuous lender? Why - Countrywide, the nation’s largest mortgage lender, recently in the headlines as it hurtled toward bankruptcy.
As I watch CNBC Kudlow and company try to convince me that John Mc Cain is a conservative.
This was posted and discussed at length yesterday.
wet blanket
Is it fairly routine for the rated to “frantically raise capital” in order to convince ratings agencies they are credit worthy? Reminds one of the plight that must be facing at least a few prospective U.S. homeowners upon learning that downpayment requirements are back in vogue.
Monolines downgrades could hit banks
By Aline van Duyn and Michael Mackenzie in New York and Paul J Davies in London
Published: February 5 2008 19:32 | Last updated: February 6 2008 03:12
Standard & Poor’s, the credit rating agency that is considering downgrading the top triple-A credit ratings of bond insurers, warned that the move could be damaging for banks with direct exposure to the insurers.
The forecast came as bond insurers including Ambac, FGIC, MBIA and SCA continue frantic efforts to raise capital to avoid downgrades.
http://www.ft.com/cms/s/0/b5655a7a-d41c-11dc-a8c6-0000779fd2ac.html
Let me see if I understand the logic here. The bond insurers insure the bonds the banks hold. The bond insurers are insolvent and will not be able to pay claims to the banks. As a result, the banks will have additional losses. So, the regulator’s bright idea is to persuade the banks to give more money to the bond insurers that cannot pay.
The money being raised is all designed to keep the bonds from being downgraded . Somehow to me this bailout plan reeks of “conflict of interest” and is not acceptable .
Very interesting…
Nikkei blew out 5%, and the margin calls must be coming fast & furious, and there’s a lot more mellow yellow in Nippon, then there is here, and the awfully attractive metal is up $11.
there’s a lot more mellow yellow in Nippon
Have you been hanging out with NYCityBoy again?
BTW, how is that Trump real estate project down in the Baja coming along?
Kidnappings of U.S. citizens on rise
Sophisticated Mexican groups plot abductions
By Tony Manolatos
STAFF WRITER
February 6, 2008
Organized, well-financed and violent Mexican kidnapping cells are targeting a growing number of U.S. citizens visiting communities popular with San Diegans and other California residents.
http://www.signonsandiego.com/uniontrib/20080206/news_1m6kidnap.html
Many parts of Mexico have been taken over by the narco trade, including police departments…
The Mexican army had to disarm the entire Rosarito Beach P.D., last month.
Mexico is on the brink of becoming a failed state.
All the more reason to get the wall built.
Annex it. We frankly need more “united” states, less federal government.
Not that this will happen, people seem to only want MORE federal government.
I would welcome Mexico as another 2 states into the USA. Just lower federal minimum wage to $1 and let states set their own, if you want social health care: make it state level and not federal.
I don’t want a “high tax high benefit” social nanny state, I could move to another.
the solution to our problems is to let states work out problems then let the good solutions spread to other states. Yha, some will go backwards - but that’s freedom baby!
Annex it
The Mexican people might not go along with that. Sure, they’ll come here to make $$$, but they are not interested in becoming Americans.
Also, past polls in Mexico have indicated that half the country would move to the US if they didn’t have to be illegals. Abosrbing 50,000,000+ Mexicans could prove to be interesting. At least we could stuff them into all those empty houses we have.
Annex it. We frankly need more “united” states, less federal government.
Not that this will happen, people seem to only want MORE federal government.
But the PTB that state they are for smaller gov continually build a bigger gov and also take away states rights to gov themselves.
I feel like I am on one of those playground things where you are on it, and someone else stands offside to push it faster for you so YOU get dizzy and fling yourself off.
What is that “toy”.
I just thought the mangy stray dogs; the leering, toothless, stubbled street vendors; the filthy shoeless, chiclets-peddling children; the scent of stale tequila, cerveza, cigarettes and vomit wafting from the cantinas crammed with wildly drunken under-age youth; and the charming policemen who will disregard your ticket for driving the wrong way down an unpaved road for a mere $80 were alluring. The notion of my Mexican holiday turning into an abduction by masked Mexican gunmen is inexplicably titillating! I’m calling my travel agent - and pronto!
A friend of mine had her car stolen (with a distinctive custom paint job) in San Diego. Almost a year later, while watching the evening news, she saw her car being driven by the Mexican police in a story about drug runners crossing at the border and working with San Diego police. She demanded that her car be returned, but nothing came of it.
Pardon, el senor federale. Por favor debe me mi coche con muchos colores y la licencia de San Diego. Muchas gracias.
“A week ago, Mexican authorities rescued two female real estate agents who were being held in a Tijuana neighborhood. The women were kidnapped Jan. 19 by three men after showing a property in southern Tijuana, the Baja California Attorney General’s Office said in a statement.”
Geez. Kidnapped after showing property.
they did want to accept the first ransom of 3 mcmansions and are still negotiating
Did they get to write an offer after all of that?
“This is not about terrorizing people or retaliating. This is about making money, and obviously this is good business for them,” Horan said.
I guess that real estate thing wasn’t too profitable for them either.
Just got back from Cabo…what a waste..fast becoming a tourist trap…like a turd on a Monet. It is almost as bad as key west. We need a bomb that destroys all tourist shops and Gringo bars. But I digress, I Stayed a fancy resort for 3 days and reservations were down 30% from last year per mgmt. Drove up the Mex 1 hwy. Incredible. No other white boyz at all. few europeans. Safe no problems but did get the bite from Los Federales for $40….better than jail.
Funny, but I thought I just heard the sound of a stock market bubble bursting. With yesterday’s ISM report, the bond market move is fundamentals-driven.
Bubble trouble in Treasury market?
Buying spree puts prices in question
By Leslie Wines
ASSOCIATED PRESS
February 6, 2008
Investors’ raging demand for safe assets over the past six months may have created a bubble in the Treasury market – and some onlookers expect to hear a bursting sound any minute now.
http://www.signonsandiego.com/uniontrib/20080206/news_1b6treasury.html
“Of course, many analysts do not buy the idea that the Fed will halt rate cuts soon.
Paul Nolte, director of investments at Hinsdale Associates, believes the central bank made clear with its latest rate cut Jan. 30 that it is now preoccupied with economic weakness and likely to keep cutting rates. If that is true, investors won’t want to liquidate Treasurys.”
Scuze me, Mr Nolte, but aren’t Fed rate cuts in the face of inflationary pressure likely to reduce, not increase, the value of l-t Treasurys, due to the perception among bond traders that the Fed is trying to stimulate the economy out of a slowdown at the risk of higher inflation?
Ha. I’m bullish and long indices at the moment.
Is your bullishness based on news (either MSM or behind the scenes) or instinct?
I suppose a high-level meeting between Dodd and Bernanke could be interpreted as bullish for U.S. asset markets.
just charts. support on the s&p and point and figure
Phew…..thought maybe you were listening to Cramer, lol.
Last night his attitude was “no big deal, take a few profits yourself, this too shall pass” re: yesterday’s drop.
jdsu had a unbelievable premarket rocket ship…that you chick?
“February 6, 2008 9:42 A.M.EST
BULLETIN U.S. STOCK INDEXES RECOVER SOME GROUND LOST IN TUESDAY’S DRUBBING
When you wish upon a stock Disney results offer ray of sunshine after markets get ’super-drubbing’ ”
What are the charts telling you right now?
http://www.marketwatch.com/tools/marketsummary/
Is it safe to buy the dip yet?
BREACH!!!
Got any P&F charts for this action?
http://www.intrade.com/
Good call on picking up calls yesterday.
VIX charting 101 for me today.
I think it’s hilarious the market bounced on better-than-expected Disney results. Give me a break. Disney profits were down, just less down than expected. Bank stocks bouncing off this doesn’t make any sense. I give this the day before it wanes.
“…this doesn’t make any sense.”
Epitaph for the U.S. bull market…
http://www.floridarealtors.org/NewsAndEvents/n3-020108.cfm
“You know builders are desperate for cash when when Developers Sue Realty Firms over previous paid commissions.
With numerous condo buyers walking away from sales contracts, developer Related Group has begun suing real estate brokerages to get back commissions on those busted deals.”
wow, wonder what the verbage is in the contracts
LOL, SunDevil. I thought I’d seen everything, now developers are going are going after realtor commissions? That is such a hoot.
blood from a stone comes to mind
a florida realtor is not exactly flush with cash at this point in time
Exactly, their cash has already been spent or “invested” in more real estate. Can a judgement against a realtors’ boob job be enforced?
Breasts repossessed.
RE: Can a judgement against a realtors’ boob job be enforced?
I think I could go for a state court job entitled “physical asset inspector”!
“It’s Related’s practice to pay commissions after buyers put down deposits, rather than when sales close.”
Now whose stupid idea was that?
No kidding. They asked for it.
I think during the boom years it was an incentive to get the realtor to bring their buyer to your condo development first (kinda like offering a larger than 6% commission). Since nearly 100% of the purchase contracts were closing back 2 to 3 years ago it wasn’t a concern.
NOW, its a big concern. Poor Related (sarcasm intended).
cramer had an interesting comment
market can’t go anywhere till housing turns up
wow, see you in 2-3 years…………….
He also said housing will continue to bottom until the Fed funds rate hits 1.75 percent……does this make sense to anyone??
To Jim it does. Look, I have no problem with Cramer as long as he is still on his meds. It’s when he dumps them that I have a issue.
Roidy
How can one tell the difference??
Someone buy one of these for Jas
http://www.zazzle.com/deflationistas_do_it_for_free_shirt-235458381991754446?CMPN=ltt
oops
http://www.zazzle.com/pd/find/qs-deflationistas?sp=7
Thanks TXchk for link.
got Cougar Bait for pal’s son.
Shouldn’t the price of that shirt be falling?
I’ve certainly noticed that deflation has taken a toll on the price of some books…
Are You Missing the Real Estate Boom?: The Boom Will Not Bust and Why Property Values Will Continue to Climb Through the End of the Decade - And How to Profit From Them (Hardcover)
by David Lereah (Author) “The recent U.S. real estate boom has made money for an incredible number of households in America…” (more)
Key Phrases: real estate services companies, home price appreciation, real estate expansion, Fannie Mae, Freddie Mac, United States (more…)
43 Reviews
5 star: (11)
4 star: (4)
3 star: (0)
2 star: (1)
1 star: (27)
See all 43 customer reviews…
List Price: $19.95
Price: $19.95 & eligible for FREE Super Saver Shipping on orders over $25. Details
Availability: In Stock. Ships from and sold by Amazon.com. Gift-wrap available.
Only 3 left in stock–order soon (more on the way).
…
56 used & new available from $0.31
http://www.amazon.com/Are-Missing-Real-Estate-Boom/dp/0385514344
I wonder how Armando “D0uche-bag” Montelongo’s book is doing? I watched a re-run of the “Cat House” episode where his brother and SIL quit and the house was a money pit. Sweet.
Worker Productivity Slows Sharply in Final 3 Months of 2007 As Wage Pressures Increase
http://biz.yahoo.com/ap/080206/economy.html
Is that another popping sound I hear???
Oh noes!!!!! Wage pressure increases! We can’t have that!!
Wages can pressure all they want, but management won’t budge. We have a few reqs that have been open for a year that we can’t fill. We have found acceptable candidates, but they always reject the offers as too low.
That is a contrarian signal that the worst is over. I expect a rally on the headline U.S. stock market indexes to confirm that a bottom is at hand, and only the sky is the limit on how high winged bulls can fly.
Worker Productivity Slows Sharply in Final 3 Months of 2007
I blame Ben Jones and the HBB
The HBB has certainly caused mine to deteriorate.
We’re living/witnessing history…so it’s okay.
We’re living/witnessing history…so it’s okay.
Real Estate Agent in 2005: Man, it is like shooting fish in a barrel. People are bidding 20% over asking price. That Johnson place I sold in 2001 for $125K just sold yesterday in 3 hours for $425K. Plus Jim the broker is giving me an extra 3% if I go to them. Should I feel guilty about all the 6% cash I’m swimming in?
“We’re living/witnessing history…so it’s okay.”
This is epic history, in real-time.
Prices rising? No problem. Wages rising? THAT is a problem.
Thinking of everyone in the affected southern section of our country. Stay safe today GA, Floridians!
Long time lurker, first time poster (be kind!). (BTW, great blog, Ben!)
From GMAC ResCap’s hometown paper:
http://www.startribune.com/business/15336216.html
ResCap’s Loss for All of 2007: $4.3 Billion
“ResCap’s loss for the year was a stunning $4.3 billion — a swing of more than $5 billion from its $705 million profit in 2006, before the housing boom ended and the company’s mortgage-lending business went sour.”
“Said Jim Jones, ResCap’s chief executive: ‘We all understand that the best benefit to us in terms of both job security and job opportunities is to make the business successful.’ ”
“Meanwhile, nonaccrual loans — loans for which full interest or principal has not been paid on schedule — rose to 7.1 percent of ResCap’s receivables, up from 5 percent in the same period in 2006.”
Two interesting points:
First, nonaccrual loans (read: loans/houses that will eventually be fire saled) are 7.1% of receivables. Just in case you missed that, 7.1% OF FREAKIN’ RECEIVABLES!!!
Second, their leader’s name is “Jim Jones”. My message to ResCap employees: Avoid the company outing, by all means avoid the Kool Aid!
“When you wish upon a shooting star…” I guess increased recession risk is good for Disney’s prospects, as the first thing laid-off workers want to do is spend a few days at the Happiest Place on Earth?
http://www.marketwatch.com/tools/marketsummary/
Looks like the proverbial wall of worry is experiencing a landslide…
Wouldn’t surprise me. Laid off workers typically get good severance for a few weeks / months. If you assume that you can turn around and get a job easily, then why not take advantage of a few weeks’ worth of double paychecks, along with some time off? Not unreasonable given the still-low unemployment.
When unemployment starts to get high though - like past about 6-7% or so, then look for that trend to change dramatically.
Stimulus could get spent on Disney vacations too, I suppose. But that does not sound like much of a boost to their long-term profitability. In fact, yesterday’s ISM survey results should be a fundamental downer for Mickey Mouse.
The mouse house conference call was highly informative. The cruises are 85% sold out for the year. What it means, I have not the faintest idea.
85% booked, kind of like deposits on unbuilt houses.
A weeklong Disneyworld vacation for a family of 4 can easily cost $5000. Those cute commericals touting packages starting at $1600 are shorter, are at “resorts” that resemble a Motel 6 (All Stars) and do not include meals (very expensive at WDW), airfare or ground transportation.
If I had just been laid off I would hang onto my severance check until I found a new job.
I have to compliment the PPT for holding the line at the opening bell level, just when Mr Market looked like he wanted to jump off a cliff. Heckuva job!
The market’s ability to snatch a rally out of the jaws of a selloff proves that America has a resilient economy.
Bear Stearns cuts rating on General Motors and Ford
By Steve Goldstein
Last update: 7:34 a.m. EST Feb. 6, 2008
http://www.marketwatch.com/news/story/bear-stearns-cuts-rating-general/story.aspx?guid=%7B921E7F53%2D8AB9%2D4D4A%2D9897%2D99EB9CD1ACEB%7D
Who is buying now?
Mortgage applications rose 3% last week: MBA
By Amy Hoak, MarketWatch
Last update: 8:25 a.m. EST Feb. 6, 2008
CHICAGO (MarketWatch) — Applications for mortgages rose a seasonally adjusted 3% last week compared with the previous week, reflecting a pick-up in filings for loans to buy homes, the Mortgage Bankers Association reported on Wednesday.
http://www.marketwatch.com/news/story/mortgage-applications-rose-3-last/story.aspx?guid=%7B8C459B0F%2D77EE%2D4F04%2D87EE%2D110D7EBC1AD0%7D
All this means is more people are trying to refinance, often submitting multiple applications. The mortgage industry and realtors keep harping on these meaningless numbers, trying to make us believe everything has turned around. Today, that idiot Fishkind, or whatever his name is, Florida’s most deluded “economist,” said that prices will not drop any farther. This was reported on the local news as God’s Truth, so who am I to fall down laughing?
“Fishkind, or whatever his name is, Florida’s most deluded “economist,”
He has serious competition from Sean Snaith.
I forgot about that one. I think they must be associates of Sylvia Browne’s.
The mortgage industry and realtors keep harping on these meaningless numbers, trying to make us believe everything has turned around.
Some of them actually believe the downturn is all the media’s fault. So if reporting bad things creates a decline, reporting good things will make things all better.
happy talk happy happy all the time
so who am I to fall down laughing? Incredulous!
Anybody know what happened for this?
Sears, Roebuck & Co. is closing down and laying off 149 employees on March 9 at 5601 Santa Monica Blvd. in Hollywood
Apparently they laid off employees that were standing around doing nothing….
No good damn wage earners. Get rid of them. /sarcasm off
Had a friend who tried to buy something at that very store a few years back. Had such a bad experience that he vowed never to return. Drove 10 miles to Burbank instead.
Sears, where America doesn’t shop.
Not sure. I drove past that place a couple of weeks ago, and saw the closing signs. Looked like it was in a pretty depressed part of town, judging by the number of pawn shops/bars on windows liquor places along there. Not a particularly large store either.
Sears will be gone soon. Go to sites like Slickdeals.net and see how they are already clearing out as much as they can, but they constantly botch it. You order online and they actually phone you 20 minutes later to say ‘ready for pickup’. But then you show up and they don’t have the item. And they offer nothing as compensation. Talk about empty stores and high prices (when not on clearance).
I ordered Xmas presents thru Sears dot com. I tried to return items that didn’t work out to the store, but they would not accept them. I returned them to Sears dot com, but they said they never received them and so I’m out over $100 plus time and trouble. Sears just has bad karma and I advise everyone out there to steer clear.
I couldn’t watch Squack Box this morning. Kudlow, Amrey and Forbes on screaming SUPPLY SIDE!
Are they liars, totally dumb or just blinded by dogma????
We have run the course of supply-side economics and have reached the end-game… No demand.
Supply-side is that you slam more and more capital into markets, and pooofffff…. growth.
The problem with it is, that businesses need 2 things: capital and customers. We were awash in capital to the point we ran out of customers. The customers maxxed out their debt and are now defaulting on that debt at record rates. The customer is done.
Kudlow actually made comments like the rebate checks are the dumbest idea ever and should actually be using the money to further cut taxes on the rich. WTF?? The rich stay rich only if the poor keep spending. The poor have quit spending. How do tax cuts on the rich help the rich if the economy simply stops and the rich have no income to be taxed anyway?
He also said that low unit wage is a key to American properity.
He went on and on about how no politician is addressing the needs of the investor class.
Why doesn’t he just come out and say it. He wants the rich to get richer and the poor to get poorer. That is his dream land… this privelaged few “investor class” become the new arestocracy while the (looks down his nose) “workers” become the serfs, share-croppers, endentured servants….
What a moron!
You know, if we can just get the average wage of the American worker down to subsistence levels, we can reach our economic goals.
What are those, anyway?
Keep the rich getting richer…. That is the goal of supply-side economics, right? Deregulate markets and drop the tax rate on the rich to ensure the rich have ample oppertunity to get richer. Everyone else? They exist to make the rich, richer….right?
No wonder they hate McCain. Spending cuts first…. then tax cuts? We can’t have that.
Campaign finance reform to take away our ability to buy politicians to make sure they enact laws that will make us richer? Can’t have that.
Tax relief focused at the workers instead of the “investment class”? Can’t have that.
“How do tax cuts on the rich help the rich if the economy simply stops and the rich have no income to be taxed anyway?”
I’m not rich rich but this year OV won’t have to pay any estimated tax. I may get $ back.
I went to bed with a pounding heart and woke up shakey.
Classic anxiety.
One thing worse than estimated taxes is un-estimated taxes. I will have to explain to my wife in a couple of weeks how $40k of my “wages” ended up on a 1099 instead for 2007. That should be a fun discussion. I hope the under withholding penalty doesn’t become one of those “camel-straw-my back” events.
Why the rich, rich want to repeal the AMT.
They got the capital gains tax rate cut to 15%, but that doesn’t do them any good if they are up against the 28% AMT.
I got hit by AMT for the first time this year. Given my druthers…. Paying $300 extra taxes casued by AMT, or giving back the $50K extra income that caused me to hit the AMT… ($10K amilony ended, wife got $22K raise, and I got $16K severence from one job and a raise when I started the next job)
I’m thinking I will take the $50K…. Even if I have to pay $20K extra tax tax because of it.
I’m thinking I will take the $50K…. Even if I have to pay $20K extra tax tax because of it.
BINGO.
This is why a flat tax makes sense. And cut all the damn layers of taxes (income, sales, license fees, property). Then we can all get a clear view of exactly how taxes impact income.
I don’t have a problem paying taxes. If I am going to earn another $50K I’ll pay another 20K in taxes. I do however hate the paperwork and knowing someone who makes more can afford to pay someone else to do it (smaller percentage of overhead when you make $2,000,000 a year to pay $50K for an accountant).
I think the key to _the people_ taking control is transparency and simplicity in taxes. If people saw how much they really paid (all the various forms) they might think a little more before asking for ‘free’ handouts.
Tiny Texas Houses
http://www.thestate.com/real-estate-wire/story/308379.html
Paul Volcker is mentioned from time to time on this board. The comments remind me of the way someone laments about a long-lost lover. I’m wondering what you all think about him coming out and endorsing Obama the other week.
Anybody want to play Gold scissors paper?
If the price of chocolate keeps going up, they can close all their facilities.
Hershey Chocolate of Virginia Inc. is laying off 163 employees at 120 Harold Cook Drive in Stuarts Draft, VA, as of the end of January.
I usually buy Swiss chocolate and what used to be 3 oz’s is now 2 oz’s.
It’s a Potemkin village gig, as the bars are the same size, but 2/3rds as thick.
Has anyone here tried Hershey’s Aztec spiced hot chocolate mix? If so, how is it?
I don’t know, but I’ll bet the real Mexican stuff (Abuelita, Ibarra) is better and cheaper. You can find them in the Mexican food section of your local supermarket. If the don’t have it, try your local Super Walmart.
Keep in mind, this is the stuff that is sold in solid form, not powder. An easy way I have found to makle it is:
1) Soften the chocolate in the microwave (say 20 seconds)
2) Pour the softened chocolate into a blender with hot milk and blend.
Is it sweetened? I seem to recall Mexican hot chocolate being served without sugar, and very spicy.
We use Ibarra almost exclusively. We use it in our mole usually, but yeh, you have to sweeten it. Any old sugar will do.
IIRC, Abuelita is already sweatened, but you might want to sweaten to taste. It also has a lot of cinnamon.
The Little Debbie’s/Tastycake factory is a couple miles down the road and they’re doing fine. Hershey’s is locked into a high-priced, low innovation strategy that doesn’t work in this environment. Discounters rule!
I hear the choco ration is being increased 10 grams. Double plus good.
Luv_footsie or HHPanky
What’s going on in the housing in Australia since they raised rates. I see the Australian metals are soaring again, Jobs?
Also what is the grain crop looking like?
I think the International Bits is where all the info is on AUS.
Aladinsane this ones for you.
“…The accuracy of the representation of past climate trends and their cause suggests that the same models are a reliable predictor of future conditions in the West. These models have forecast a serious water supply problem for those dependent on the Colorado River drainage and substantial alterations to the hydrology of the Sacramento River delta, home to many sensitive ecosystems and economically important wildlife.
The models “portend a crisis,” said Barnett. “After the performance on the last 50 years of observations, we can put high confidence in their general predictions for the next 20 years, at least in the western United States.”
“Climate Crisis” in the West Predicted with Increasing Certainty
Scripps Institution of Oceanography/UC San Diego
EMBARGOED BY SCIENCE FOR RELEASE:
http://tinyurl.com/243jb4
Hoz…
Looks like the Empire will still have plenty of H20 in the year 2050.
Everybody else looks a little iffy.
Emperor Norton II, of the Inland Empire, Protector of Mexico & Adjacents
“When markets are in trouble, the phrases are always the same: “The economic situation is fundamentally sound” or simply “The fundamentals are good”. All who hear these words should know that something is wrong.”
John Kenneth Galbraith
“The Great Crash 1929″
txchick,
Did you cover short GLD yesterday?
No. See a potential h&s top on that and want to add. It’s a small position right now.
PPT working overtime today.
They need to make sure the stock market always goes up, in order to prove the terr0r!sts have not won!
The CAGR on the S&P 500 for the last 10 years is about 1%.
http://tinyurl.com/2fam3n
Take a look at Al G in this clip. He wants to suppress the highly skilled and educated by importing people who would demand lower wages for the same work. Then he wants to improve education and training people with these very same skills. So what is the incentive to attain this level of education and skill? I note that Al is wealthy. I also note that without appropriate compensation, no one would want to attain that level of skill. It takes a lot of effort and money to do that. I know.
He is such an old fool
Roidy
Yea, I saw Al state hire out for high skilled. WTF. what about the citizens in the US? What are the US citizens, chopped liver?
Wtf is up with the Uber wealthy, and what kinda crap are they teaching in those bs mba schools? rape, loot, pillage, enjoy your 5 homes and expensive shower curtains?
Where did this mental state come from and how can we turn them around to view a little more of the ENTIRE picture, not just themselves…
rantoff. too much green tea.bzzzzzzzzzzzz
Slash and other “celebrities” losing their a$$ in real estate:
http://www.forbes.com/business/2008/02/05/hollywood-economy-housing-biz-media-cz_dp_0206realestate.html
Whoa 271 (I mean, 272!) posts on the hbb blog already? At 9amPST ?
For a year and a half I’ve been posting about a house in Morro Bay that was offered at $580K in early 06, at various prices down to $419K in 2007, at $349K at the beginning of 08, and now…voila! it is sold! We are still talking about almost $500 per square foot, but this was certainly the lowest-priced free-standing house on the MLS, after the price was reduced to the $349. I hear the buyer is someone who already owns several MB houses. Thus, “investors” are not yet out of the picture, and there is no way the POS will rent out for more than $1000/mo. So, Knife Catching with a capital K and a capital C.
Could this be the news that sparked today’s contrarian bull run? If any index whatever is at a 14 year low, then clearly a bottom is at hand.
Consumer comfort gauge plunges to 14-year low
By Rex Nutting
Last update: 5:01 p.m. EST Feb. 5, 2008
http://www.marketwatch.com/news/story/consumer-comfort-gauge-plunges-14-year/story.aspx?guid=%7B86316999%2D6EB5%2D4C93%2D8F07%2D0436A8E63D4C%7D
this is not your father’s recession.
It is not a recession — it’s a growth slowdown.
1:38Plosser sees ‘08 core inflation above stable range
1:38Plosser: Growth will pick up in H2 and into 2009
1:38Plosser: Growth in first half will be around 1% rate
1:38Plosser: Slight rise in price worries could be warning sign
1:38Plosser: Slower growth doesn’t always mean lower inflation
That was based on last weeks data; this weeks data is a new chapter.
according to NBERs modified definition from 2003, its a recession.
It seems Wall Street didn’t like what the Fed had to say, so it looks like today’s Bull run has been temporarily postponed.
Jeremy Hobson: Right now, Fannie Mae and Freddie Mac can purchase loans no higher than $417,000 to limit risk. The stimulus package would hike that up as high as $729,000 in some areas. It also calls for boosting limits on mortgage insurance from the Federal Housing Administration, which would benefit lower-income families.
Charles McMillan of the National Association of Realtors says raise the limits, and more people will be able to buy homes.
Charles McMillan: More importantly, so many more people will be able to refinance into something much more palatable at interest rates much more appropriate.
But there are some who say raising the limits will just pass the troubles of lenders onto the government. Banking consultant Bert Ely says Congress shouldn’t rush through Fannie and Freddie reform as part of the stimulus package.
Bert Ely: Lots of times in circumstances like this, things are done that are not very helpful — maybe even counter-productive.
Ely says Fannie and Freddie have enough trouble as it is, and shouldn’t be taking on more expensive loans.
http://marketplace.publicradio.org/display/web/2008/02/06/battling_recession_with_fannie_and_freddy_
Why do banks want to return to lending at historically low rates anyway? If the loans they will make aren’t ARMs, do they really think that interest rates will stay low forever? Or maybe they really do need the fees NOW…
McCain is on the right track - especially about this part: The only people who deserve assistance are those who should have qualified for a better deal than they got. And, even then, the most government should do is freeze or readjust mortgage rates. It shouldn’t pay out a dime. Those who had bad credit and had to turn to the subprime market in order to purchase a home should never have been buying in the first place. And if you bail them out, what are the chances that they’ll wind up in a similar scrape down the road?
Thanks to unscrupulous lending practices where a lot of people made a lot of money by preying on others, and where many of those predators most certainly belong in jail, we now have a situation where many homeowners can’t afford to stay in their homes. But make no mistake. We can’t afford a wholesale bailout - not just because of the cost to government, but because of the cost to our society and the principles that hold it together.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/02/06/EDHGUSFTI.DTL
And yet just a week ago, McCain admitted he knew absolutely nothing about economics, and trusted in the Fed to do whatever was right: an article of faith he’s been professing for many months now. The Government has no authority to freeze or adjust mortgage rates agreed upon by private parties in a transaction; only the parties in question can amend the contract. If a contract is illegal, it can be voided. Clearly McCain is Hillary’s twin, separated at birth, and spewing exactly the baloney.
I remember he was trying to sell his own house in Phoenix a year or two ago. I wonder if this is a factor in his position.
The prospect of pro-war McCain as president and bible-thumping/”queer-baiting” Huckabee as another animal-abusing vice president (I think the two candidates are in cahoots) , both pandering to La Raza and Christian fundamentalists, is too much to swallow without a big drink.
“Thanks to unscrupulous lending practices where a lot of people made a lot of money by preying on others, and where many of those predators most certainly belong in jail…”
Darn, got excited there. Thought he was talking about the fradulent buyers at first. The loan-owners were preying on the banks just as hard as the mortgage brokers were. And these liar loan people aren’t as cuddly as the banks are.
This is the first shard of sensible leadership on the housing crisis that I have seen any of the candidates exhibit to date. I am glad he is doing well in the primaries.
When asked about the issue during last week’s CNN Republican presidential debate in Los Angeles, John McCain took a somewhat saner approach. He said that lenders must “return to the principle that you don’t lend money (to people) who can’t pay it back.” McCain said there are “some greedy people on Wall Street who perhaps need to be punished” and urged that there be more transparency. He also said that, ideally, a mortgage “should be one page … (with) big letters at the bottom that says, ‘I understand this document.’ ” Last, McCain implied that any bailout should be limited to “people who were eligible for better terms but were somehow convinced to accept the mortgages which were more onerous on them.”
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/02/06/EDHGUSFTI.DTL
Oh my… God.
I… I like something McCain said. Am I having a stroke? What’s happening? The walls are disappearing! Everything is turning pink! Meeeep! Meeeeeeeep! Ah-wooooooooo-gah!
wow..he sounds almost like Edwards. It makes you wonder who the real republican is in this race
*cough cough* Hilary *cough *cough*
“…Two points shine out about the financial system over the past three decades: its ability to generate crises, and the mismatch between public risk and private reward….
It also true, on the second point, that the banking sector is the recipient of massive explicit and implicit public subsidies: it is largely guaranteed against liquidity risk; many of its liabilities seem to be contingent claims on the state; and central banks create an upward- sloping yield curve whenever banks are decapitalised, thereby offering a direct transfer to any institution able to borrow at the low rate and lend at the higher one….
Yet big risks have indeed been run. The US itself looks almost like a giant hedge fund. The profits of financial companies jumped from below 5 per cent of total corporate profits, after tax, in 1982 to 41 per cent in 2007, even though their share of corporate value added only rose from 8 to 16 per cent….
In the end, we are left with a dilemma. On the one hand, we have a banking sector that has a demonstrated capacity to generate huge crises because of the incentives to take on under-appreciated risks. On the other hand, we lack the will and even the capacity to regulate it….”
FT
Martin Wolf
http://tinyurl.com/yps2zy
Banks being regulated by the Federal Reserve is more dangerous than Passenger Airline carriers being regulated by the airlines or miners safety regulated by mine owners.
Hoz,
I agree with your last paragraph.
What’s the old saying business will police itself? How’s that been working so far? I’ve never seen it.
“What’s the old saying business will police itself?”
Did you mean that old saying about letting the foxes guard the hen house? Or were you thinking of the more recent one about Cookie Monster guarding the cookie jar?
Professor,
All of the above.
TEST
I propose a simple solution: Create incentives for would-be sellers of vacant homes to lower the asking price to levels the market will bear.
As Houses Empty, Cities Seek Ways To Fill the Void
By Michael Corkery and Ruth Simon
Word Count: 1,342 | Companies Featured in This Article: Washington Mutual
Cities are scrambling to cope with a surge in vacant homes and abandoned properties in the latest fallout from the mortgage-lending crisis.
Nationwide, the homeowner-vacancy rate, which measures the number of vacant homes for sale, rose to 2.8% in the fourth quarter, the Census Bureau recently reported. That matches a record set in the first quarter of 2007 and is the highest since the government began tracking vacant homes in the 1960s.
The current vacancy rate could be the highest since the Great Depression, when an exodus of Americans left the Dust Bowl states for the West Coast,…
http://online.wsj.com/article/SB120226298614746353.html?mod=todays_us_marketplace
The gubmint still seems to prefer use of demand-side stimulus programs to try to goose home sales. Why not just for once trust Mr Market’s superior judgment on this matter and try to encourage buyers and sellers to find a mutually-acceptable middle ground? Incentivizing more buyers to purchase homes they cannot afford could backfire, leading buyers to misplace blame for foolish decisions to catch falling knives on stimulus measures.
“trust Mr Market’s superior judgment on this matter”
You can’t buy votes with “we’ll just let this little thing run it’s course, it will be better for everyone in the long run”.
People want it better NOW. Just like they want everything else NOW.
You are correct. Feeding the popular delusion that politicians are directly responsible for the economic prosperity of the American voter is a time-tested campaign strategy.
I just can’t wait until some woolly, wacky, socialist-type town gets lots of press for seizing houses from banks. They’ll probably use a vacant property/nuisance/tax lien strategy, figure the bank owes them more than the house is worth and repossess like mad. And the talking heads will then launch into a tirade about the sanctity of property.
If a Vermont type town gets there first, the attack will be about socialism, if a historically black city does it first, there will be the usual racist undertones [ie., blacks wanting stuff for nothing.]
Point is, property seizures will occur, as this thing progresses and the market locks up — with no buyers, plenty more will go vacant and local authorities will get tired of waiting. What thousands of towns will see is the local effect of Wall Street greed — this thing is turning into a veritable neutron bomb.
Someone pointed out a couple days ago that the Federales are essentially nationalizing the housing market — at the local level I expect to see plenty of outright seizures.
Another possibility is for local gov’ts to work out deals with the banks, to purchase for, say 25K a unit, float a housing bond to finance the purchase and then set up a mortgaging division to put people into truly affordable housing. The bond could get paid back — after the agency securitizes the mortgages, for an ironic denouement.
Anybody see this last week. Just curious
Wal-Mart Stores, Inc.
Bentonville, AR
In a major revamping of its sluggish clothing business, Wal-Mart Stores will shut two divisions at its headquarters in Arkansas, eliminate dozens of positions and move dozens more to New York City. This will be the first time in years that Wal-Mart, a company renowned for growth, has laid off a significant number of workers at its headquarters. The overhaul is intended to revive one of the weakest departments in Wal-Mart’s 5,000 stores: men’s, women’s and children’s apparel, a $30 billion business for the retailer. In an announcement Tuesday, the company said it would close its product development and sourcing divisions. As a result, dozens of positions will be eliminated. The work handled by the two divisions will be shifted to different units, called buying and brand merchandising. The buying unit will be based at Wal-Mart’s headquarters in Bentonville, Ark.; brand merchandising will be in New York City.
Approximate Affected Workforce: N/A
Source: The New York Times - January 30, 2008
There goes the Bentonville local housing bubble…
Real estate signs are about to sprout like weeds.
It already went. This should help things along tho.
The point of fashion is to say “I am better than you”. Sorry, but I do not care where the clothes are designed (New York or Bentonville). Anything sold at Wall-Mart will NEVER say “I am better than you”, and will therefore never be purchased at a high price or in large quantities.
You can buy a DVD at Wall-Mart since no one will know it is from there. You can buy tools, car parts, medicines, paint, etc.
But, could you imagine going to high school and having the resident snobs say “You got that shirt at Wall-Mart, didn’t you.” or “That brand of shoe is sold at Wall-Mart, isn’t it”.
What would a stylish woman say if her friends asked “Where did you get that skirt?” She can’t lie because a friend may go to the place looking for the skirt.
Soe things Wall-Mart can do, some things it can’t. Fashion it can’t.
WalMart is pretty good for some minor clothing items, like light sweaters, summer blouses, capris, plus undergarments. But definitely not good for coats, dresses, or shoes.
They keep the stock moving and you never know what kind of thing you might pick up there. But they rearranged everything here so i can’t find anything anymore. But ooh ooh they put in hardware floors and tried to make it more like a mall boutique. That shows you they’re worried about something.
Ahhh, the joys of living within an association community:
Light bulb feud sparks $80,000 in fines, fees
http://www.azcentral.com/community/scottsdale/articles/0206sr-feud0207-ON.html
The Reichbach’s refused, saying they wanted to wake up to the sunrise and spectacular mountain views through their huge bedroom window.
Wow.
I mean, if you want to be so perfectly left alone, why in the h-e-l-l would you buy a house in a freaking subdivision?
“But Shelton calls it a “matter-of-life and death…” She says the lights and cameras are vital to protecting her 45-year-old daughter from a stalker.”
However, even in a non-association neighborhood, a bright security light like that (or is it three?) would be unneighborly. Get one or two directional, non “lighthouse grade” security lights in order to scare intruders, and get IR cameras and IR light sources (pretty cheap) for the video. Problem solved. I think she’s just being ornery or selfish…or both.
WTH, these lights can’t be Motion Lights for fagawdsake. whats the matter with these schnooks that they can’t get a decent light like the rest of the neighborhood and IF they need a brighter light, it should ONLY be a motion light.
Heck if I was a stalker, then I would figure out how to turn out those damn lights. what good are they anyway, but to use electricity constantly and bug the neighbors.
At night when I walk around neighborhood, there are 2 houses that have those damn lights on their garages and you need Sunglasses to just approach INTHESTREETand pass by.
It should not be that way.Had neighbors like that growing up and they got away with those damn bright lights.
There is nothing Upscale about those damn brite lights, it only makes you look like you live on a farm.And if that is what I did, live on a farm,then I would have a light or 3 like that, but not in the burbs. What is with people anyway.
beginning of rant..off now.
There must be more to this story. Why doesn’t the 45 y/o get a dog? How about a garage door opener, drive your car into the garage, close garage, and enter the home? Other comments from HBB posters have included some good ideas. It seems Sheldon has some major control issues and is about to be taken down a notch or two…
I agree the light is likely excessive, but that’s just my opinion and I don’t think my opinion outwieghs her mortgage payment.
At least it seems like she tried to be helpful. Didn’t the article say she put sheilds on the light and redirected them downward. The nieghbors on the other hand won’t even put up curtains…
West Virginia tries to block public posting of public tax maps
Via Techdirt
“People were swarming to buy stocks on margin-in other words, to have the increase in price without the costs of ownership. This cost was being assumed, in the first instance, by the New York banks, but they, in turn, were rapidly becoming the agents for lenders the country over and even the world around.”
John Kenneth Galbraith- “The Great Crash 1929″
Just replace “stocks” with “houses” and it’s a do over.
“People were swarming to buy
stocks on marginhomes with no money down-in other words, to have the increase in price without the costs of ownership.”The Great Housing Bubble 2005
I’ll bet margin buying is still huge. “Just add ‘houses’ to ’stocks’ and it’s a disaster.”
liquidity is the issue; at least for stock, you can just sell it at open market and be done with it. It is not as simple as selling a house to qualify the buyer for financing, etc. It takes a lot of time. And you know, Time is money
Big layoffs no longer limited to finance, housing
The potential for mass layoffs this year no longer seems confined to just the financial services and housing industries now that major companies in other sectors are starting to announce cutbacks as well. ….
Moving forward, this could pose a unique management challenge: Because of the more sober hiring rate in recent years, there is less “fat” to cut if a company is considering making layoffs, said Lorraine Hack, a partner in the financial officers group at executive search firm Heidrick & Struggles.
“Basically,” said Ms. Hack, also a former CFO, “it becomes a question of what limb you can live without most.”
http://www.larouchepub.com/other/2008/3506fed_pumps_hyperinflation.html
Foolish Fed’s Rate Cut Spurs Hyperinflation
I wish folks would stop linking stories from disreputable, alarmist sources. I purchased gasoline for under $3/gallon for the first time in months two nights ago. If this is hyperinflation, then I can live with it.
I wish mentally circumscribed pinheads would take the time to read said stories, examine the track record of the individual(s) making them, and be open-minded enough to weigh “contrarian” information on its own merits, rather than reflexively trying to smear or discount “alarmist” sources that happen to be dead right.
“pinheads…examine the track record of the individual(s) making them,”
Ad hominen attacks are a tried-and-tested tactic amongst Larouche’s followers (not to mention other wacko cults). Occasionally fading reputable sources is another time-tested strategy. Show me one shard of evidence that anyone in Larouche’s organization has done any original thinking or independent research on the housing bubble, and I will agree to shut up.
I don’t feel any need to spoon-feed you or anyone else with “shards of evidence,” when such evidence abounds for anyone who actually cares to look for it.
LaRouche’s economic forecasts have been uncannily accurate for years. He and his staff called both the tech bubble and the housing bubble earlier, and far more authoritatively, than anyone else that I’m aware of. Go to the Executive Intelligence Review website and do a search back to past years, and see for yourself.
“LaRouche’s economic forecasts have been uncannily accurate for years.”
Like the ‘forecast’ that says we are currently experiencing hyperinflation? I guess it is high time I go out and invest in a wheelbarrow in which to cart around my reams of paper currency. Give me a break.
http://www.larouchepub.com/other/2002/2924fannie_mae.html
The “disreputable, alarmist source” you speak of was among the first to sound the alarm in no uncertain terms about the US housing bubble - reference this June 2002 article.
OK — I will send my contributions to Lyndon Larouche post haste.
Didn’t Hitler come to power in part by making reasonable observations to the effect that the German economy was in deep doo doo?
http://en.wikipedia.org/wiki/Godwin’s_law
Comparing people you don’t like to Hitler has kind of been done to death. Can’t you come up with something more original?
Ron Paul sure went on and on about it in his talk to our caucus last night (patched-in conf call). He sounded like someone out of this blog. The kids who came out for him are all really depressed and desperate acting. Man, we may be on the road to hell but I would never let it get to me that badly.
sm landlord, thanks for weighing in with the sanity check. “Godwin’s law” definitely applies here.
Yes, thanks! I’m going to keep that link. It will quickly make fools out of those who do the Hitler name calling.
I did no Hitler name calling. I simply stated (factually I believe) that Hitler played on the dire economic circumstances in 1930s Germany as part of his rise to power. Not sure if Larouche is up to the same game, but it is not a far-fetched notion.
http://www.larouchepub.com/other/2008/3506bloomberg_putsch.html
Rohatyn and Shultz Drive Bloomberg “Beer Hall Putsch”
latest news
Fed’s Plosser warns against ‘damn the torpedoes’ rate policy
Bernanke committed to use all tools: Sen. Dodd
Dodd gearing up Senate Banking Committee to address mortgage meltdown
By Greg Robb, MarketWatch
Last update: 3:09 p.m. EST Feb. 6, 2008
WASHINGTON (MarketWatch) — Federal Reserve chief Ben Bernanke reaffirmed his willingness to use all tools available to aid the economy, according to Sen. Chris Dodd, chairman of the Senate Banking Committee.
“I think the chairman’s commitment to use the tools available to the chairman has been evident already and I’m confident he’ll continue to utilize those tools,” Dodd told reporters Wednesday after a closed-door meeting with Bernanke.
http://www.marketwatch.com/news/story/bernanke-use-all-tools-available/story.aspx?guid=%7B93804287%2DC4EF%2D4AB6%2D86B1%2D420DB198AE7D%7D&dist=hplatest
Next Fed meeting could be interesting . . .
Bernanke v. Plosser in a Pay per view cage match
http://www.larouchepub.com/other/2008/3502debt_crisis.html
Debt Crisis Moves to Center Stage
The Larouchies are taking over the blog!
“LaRouchies” are plural. I’m one guy. Despite your paranoid ravings, I’m not “taking over the blog.” I posted several links of interest and relevance to anyone seeking information and perspectives on the housing bubble, and the US economy in general. True knowledge seekers will not find that threatening in the least (and I appreciate Ben’s forebearance).
As far as my comments directed at you, Professor Bear, if you’ll stop making asinine comments, I’ll stop setting you straight. Deal?
Hey, chill buddy. I don’t always agree with PB’s ideas , conclusions or opinions, but I have found his contributions to be WELL REASONED and often highly ORIGINAL and often VERY WELL INFORMED. I should know, I have a 30 year carrer in finance and at a pretty high level.
..oops, career, not carrer
So much for any tools the Fed may have at their disposal for ensuring stock prices always go up…
http://www.marketwatch.com/tools/marketsummary/
I wish folks would stop linking stories from discredited Wall Street propaganda outlets like Marketwatch….
How else to discredit them?
THE FED
‘Damn the torpedoes’ isn’t good policy: Plosser
By Greg Robb, MarketWatch
Last update: 2:52 p.m. EST Feb. 6, 2008
WASHINGTON (MarketWatch) — An overly aggressive rate-easing campaign by the Federal Reserve would only fuel higher inflation down the road, Philadelphia Fed President Charles Plosser said Wednesday.
“There are those who have expressed the view that in times of economic weakness, the Fed must not worry about inflation and should focus its entire effort on restoring economic growth by dramatically driving interest rates down as far and as rapidly as possible,” Plosser said, calling this a “damn the torpedoes, full speed ahead” approach to policy.
Ignoring inflation during times of economic weakness “risks undermining our ability to achieve economic growth over the long run,” he added.
Speaking to a business group in his hometown of Birmingham, Ala., the Fed president also said he doesn’t agree with conventional wisdom that slower growth will automatically lead to lower inflation.
“All you have to do is recall the 1970s, when we experienced both high unemployment and high inflation to appreciate that slow economic growth and lower inflation do not necessarily go hand in hand.”
http://www.marketwatch.com/news/story/plosser-warns-against-damn-torpedoes/story.aspx?guid=%7B193CEEF1%2D667C%2D4D16%2D82ED%2D10C9F11B0403%7D
I wonder if the other governors understand the concept of cavitation?
There are physical limits to how fast you can accelerate (or decelerate) the Titanic.
test ©
how about this one: ™
TORONTO, Feb 6 (Reuters) - The U.S. dollar will continue to decline over time unless there is a change in how the trade deficit is handled, billionaire investor Warren Buffett said on Wednesday.
Buffett has bet against the U.S. dollar in the past, including in 2005, when his Berkshire Hathaway Inc (BRKa.N: Quote, Profile, Research)(BRKb.N: Quote, Profile, Research) made a $21.8 billion bet that the dollar would fall. Berkshire later unwound that successful bet as it found other non-U.S. investments. (Reporting by Wojtek Dabrowski; Editing by Peter Galloway)
Short the Euro, buy Asia currencies.
The Financial Times has a good article on CDS problems.
“…The CDS is economically similar to credit insurance. The buyer of protection (typically a bank) transfers the risk of default of a borrower (the reference entity) to a protection seller who for a fee indemnifies the protection buyer against credit losses. Current debate has focused on the size of the market. But the key problem is that a combination of documentation and counterparty risks means that the market may not function as participants and regulators hope if actual defaults occur….
If the CDS contracts fail then “hedged” banks are exposed to losses on the underlying credit risk. The CDS market entails complex chains of risk – similar to the re-insurance chains that proved so problematic in the case of Lloyd’s of London. A default may quickly cause the financial system to become gridlocked as uncertainty about counterparty risks restricts trading.
As the credit crisis deepens, the risk of actual defaults becomes real. The CDS market will be tested and may be found wanting…”
By Satayjit Das
http://tinyurl.com/2b22ce
New topic for much needed information.
What would you do if you “inherited” ‘came across’ -$5mill legally.
What would you do with it, LLC or INC or funds, or offshore, or where and how would you protect the initial bulk from taxes.
If you were to set up a LLC or a corp, which would it be and why?
Always wondered about a LLC or incorporation, which would help “little guys” like “ourselves”.
How would you diversify your money.
I’d retire and live within my means. No, really
Seek a competent money adviser.
They are registered by state. Do not pay an adviser a penny until you research references. If the adviser wants moneys up front, get another adviser.
Do your homework.
And have fun, its only money. :>)
It is a dream I have and What if …so a LLC or a S corp.
Hoz, I will check advisorS plural out.
You never know.
Has anyone had experience with either S corp or LLC? Good or bad, it doesn’t matter. A particular state to incorporate into?
My cpa friend says all tax attnys have diff opinions.
So, that didn’t enlighten me all that much.