Bits Bucket And Craigslist Finds For March 30, 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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Name:Ben Jones
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Columbia county (bedroom community for Augusta, Georgia) RE slows:
http://chronicle.augusta.com/stories/033008/bus_192831.shtml
Georgia sucks except for the northern mountain parts. But house prices are outrageous there, just as bad as Florida.
have you looked into the local ymca? pretty cheap from what i hear
I don;t know Bye why you say Georgia sucks..there are tons of nice communities here with very affordable housing..under 200K BRAND NEW..with under 1% for property taxes..
I would never compare the housing prices and cost of living(utilities, auto insurance, gas prices etc) in GA to FL..too me they are worlds apart…
Have you seen the crime of Atlanta and the rest of the southern 2/3 of Georgia? The mountainous northern Georgia is still nice but costs as much as Florida.
$200k houses in Georgia don’t interest me anymore. I can get $200k houses right here in Palm Beach County on acreage. Prices have gone down alot in Florida. Georgia is way behind in the price drops. And what costs $200k in Georgia is $100k in Texas.
Do ppl in GA north of Atlanta have stills and lil’Abner,Daisy Mae types? Do ppl have teeth in northern GA.. JUST KIDDING!
Bye lives in a world of fiction. In that world he is the person that gets to make a few hundred grand a year, live in a place with tons of services he expects to get while paying taxes on 50K place in a safe area. It does not occur to him that a 50K place on a house would bring not only poeple like him but crackheads, methheads, etc.
LOL have you looked at 1998 prices? $50k was a middle class starter house in a safe neighboorhood. It will be that way again if things aren’t “different”
Evil Cap, I think it’s simpler than that! In Bye’s fictitious world, the weather of northwestern PA will be bearable in winter as well as in summer.
Oh, and I forgot this: Bye will gag on the PA state income tax bizarre reporting requirements. The mere fact of PA having an income tax (as opposed to FL which doesn’t) is not such a big deal — PA tax is only 3% — but the PA return, instead of asking you your Federal income and going from there, makes you start over again with a separate Schedule A/B, Schedule D, Schedule C if applicable YAWWWWWWWWN. And, unlike Arizona, PA has no special form for part-year residents, and hardly any instructions for p-y’s, so you get to make lots of mistakes and wait to see if they charge you lots of penalties.
az_lender: That is why god invented turbotax.
Bye, unless the time machine invented, it is irrelevant what something used to cost 10 years ago. 50k/house is NOT a sutainable price in a sustainable community/city/town in 2008. Deal with it.
OK Bye is right $5.15 minimum wage in 1998….so if you earned a middle class wage of $9-10 hr $360-400 wk or about $18-20K a year…then $50K house was affordable
———————————————————–
LOL have you looked at 1998 prices? $50k was a middle class starter house in a safe neighboorhood. It will be that way again if things aren’t “different”
Bye FL is smoking crack on this one. I am a native of metro Atlanta, lived in Gainesville, GA (in north Georgia) for a number of years, my adult children and extended family live throughout Metro Atlanta. A wonderful house on a landscaped 1/2 acre lot can be purchased for $300K.
In the subdivision where I reared my children the homes average about $350K now. All have at least 1/3 acre, double or triple garages, most are all brick or hard-coat stucco, 90% are 2-story and all but a couple have full basements. It is in one of the most coveted public school districts in the metro area. Unless you have lived in these areas of Georgia, I would advise not making pronouncements on what it is like and the value for the dollar.
Atlanta metro has been a magnet for international corporations for about 30 years. The cost of living and the quality of life has made the area far more desirable than other large metro areas. And though it is far from perfect, it is a much better place to rear a family than where I currently live. Glad my children are grown.
There are a couple of very elite areas in the far reaches of Northern GA around Lake Burton and Lake Rabun. Corporate CEOs, retired US government officials, and the inherited-wealth crowd live there with people who have lived there for 50 years before the area boomed. In fact a retired Fed Chairman built a spectacular mansion on a small island in one of the lakes.
I am outta here as soon as my contracts expire which hopefully will be in 5 years. Then I am headed back to the SE U.S. The quality of life where I am just doesn’t compare.
I worked with a customer in Macon, GA in 2002. I thought that seemed like a nice place, what little I saw of it in one day.
I live in California, and I wouldn’t live anywhere else. I’m sure plenty of people HATE California, and that’s fine, I’m staying.
BTW, my husband says that if we had to live in another state, Georgia would be his second choice. I’ve never been to Georgia, but I’d only heard good things till I visited this board.
The more people hate CA, the more affordable it will become to live here.
**** Austin Texas get together ***
AUSTIN Housing Bubble Blog meetup! did you guys know there was a local documentary playing at the Alamo Drafthouse?
I searched the HBB and zero hits on the title “The Unforeseen”, info on IMDB here: http://www.imdb.com/title/tt0912596/
Looks like the final showing is Thursday, April 03, 2008 at Alamo South Lamar. Anyone up for a 7:15 showing?
Anecdotal story:
Had to go to the mall yesterday for things we couldn’t get any other way. Large regional mall was PACKED on a sunny spring day. However, not a lot of packages being carried around.
But what struck me was when we went into Macy’s. That place was deader than a tomb. From bumping into people constantly in the mall to hardly seeing anyone in Macy’s (shoppers or employees). Kohl’s, on the other hand, was a madhouse of busyness and long lines as they were having a “sale”. (You know,the ones where they take 50% off the already overinflated Manufacturer’s Suggested Retail price…)
Me thinks the higher end retailers are in for a rough year.
We were at an outlet mall in here in San Diego on Friday. The place was **packed** beyond belief. The parking lot was full of people waiting to find a parking space — at least one waiting in every aisle.
Met a friend for lunch there and the line was out the door before we arrived, and still a line out the door when we left about an hour later.
Even she commented on the crowds and how it didn’t make sense with the “economy the way it is.”
Interesting. We went to dinner at Black Angus in Mira Mesa last night (Sat.) - no wait. Place almost empty. Never seen that!
Crowds at a mall in So Cal mean nothing. What else do people do in So Cal? Malls, trendy restaurants, and a plastic attitude. That’s pretty much it.
By the way, I’ll be snowshoeing the PCT this morning, and sneaking up on lunker browns this evening on a private ranch (caught and released a 25″ beauty last weekend). All of this will cost me……………..nothing.
This is nothing against you, ex-nnv, and I know I’m in the minority, but I just want throw out for public consumption the fact that there are some outdoorsy types who think the idea of torturing fish just for the yucks of it is pretty disgusting and certainly not something to brag about. (I realize some people think being yanked away from your business via a sharp barb in your upper palate doesn’t hurt if you happen to be a fish.)
Your preaching to the creator of the JT treatment. Do you actually think I’m concerned about a fish’s discomfort? He’ll get over it. That’s what he gets for being fooled. Hopefully his stupidity will leave him all the wiser. (there’s a metaphor in there for the taking)
February 24, 2003
PETA’s Nervous System
Fish don’t feel pain after all, according to a major academic study comparing the nervous systems of fish and mammals. Dr. James D. Rose, a 30-year veteran of neurological science whose paper appears in the Review of Fisheries Sciences, found that fish simply don’t have the gray matter to detect pain.
Thank you ex.
Torturing?? Gimme a break. Can only imagine what you think about deer hunters.
Or what I do. You don’t want to know.
Appreciate the rejoinder - a lot better than the, oh, fish can’t feel anything crap. It’s funny - as a kid I never liked putting worms on a hook or pulling hooks out of fish (or a bunch of other stuff about animals I won’t go into). As I got older I just did it - but now that I’m getting “really old” I find everything I felt as a kid is the way I feel now.
Blano - I think killing (or pestering) NOT for food is worse than doing it for food. You’ll never convince me sport-fishing isn’t torture.
There is actually a deep question here. My personal subjective belief is that cows feel pain far more vividly than do fish (assuming that fish feel it at all in the sense that humans do).
ESSAY; Fishing for Clarity in the Waters of Consciousness
By JAMES GORMAN
Published: May 13, 2003
Dr. James D. Rose, a 30-year veteran of neurological science whose paper appears in the Review of Fisheries Sciences, found that fish simply don’t have the gray matter to detect pain.’
That’s the least believable bit of ’science’ I’ve ever heard. ‘Review of Fisheries’ my bum. Rose is clearly about comparable to any other hired whore, say..oh…Yun? Lereah? Etc?
Whyn’t they just say, ‘report paid for by Skipper’s Fish and Chips’?
I eat fish, by the way. They’re dead when I do it, but I bet it did in fact hurt at some point.
I just object to lies.
“I find everything I felt as a kid is the way I feel now.”
The older I get, the deeper my appreciation for Shakespeare grows. No offense, Paul in Jax, but you bring to mind a favorite passage:
The sixth age shifts
Into the lean and slipper’d pantaloon,
With spectacles on nose and pouch on side,
His youthful hose, well saved, a world too wide
For his shrunk shank; and his big manly voice,
Turning again toward childish treble, pipes
And whistles in his sound. Last scene of all,
That ends this strange eventful history,
Is second childishness and mere oblivion,
Sans teeth, sans eyes, sans taste, sans everything.
(As You Like It, 2.7.161-70)
“I just object to lies.”
Why don’t you publish your opinions in some peer reviewed science journals, then?
RE: I think killing (or pestering) NOT for food is worse than doing it for food. You’ll never convince me sport-fishing isn’t torture.
You need a few packs of Texas wild pigs rooting around in your backyard.
“You’ll never convince me sport-fishing isn’t torture.”
Sports fishermen generally eat their catch, so it is for food.
The level of ignorance about fishing on this blog is quite frightening!
Professor Bear –
Jaques isn’t the best character to go to for advice about human nature. How ‘useless’ is Adam?
This is nothing against you Paul in Jax, but there our some of us indoorsy people who think it is abhorable that outdoorsy people go out and trample and maim innocent vegetation just so they can feel manly. I guess you don’t think grass can feel?
No kidding. Stay on the pavement and off the grass, or else the little grassies will say “ouchy.”
‘…there our some of us indoorsy people who think it is abhorable that outdoorsy people go out and trample and maim innocent vegetation just so they can feel manly.’
How about if they just want to feel womanly? And anyhow, I don’t ‘trample’ vegetation. That’s oafish and noisy, and then I couldn’t sneak up on frogs and moss and things. I mostly delicately prance through the vegetation, like a PIXIE.
I don’t think anything should be killed for sport. For survival only. That means it is a threat or for food. Just trying to be practical. I do not believe that any other animal kills for sport (could be wrong, but I do not think so) besides humans. I think it is unnecessary and foolish.
In nature, animals kill to protect from a threat or in the case of meat eaters to provide substance. Only man kills for sport., from what I have heard.
‘Only man kills for sport., from what I have heard.’
I grew up in on a farm in far-flung rural Utah, and I believe I’ve seen coyotes kill for sport, if by ’sport’ you mean ‘for fun and excitement’. Of course we’ve probably all seen cats torment and maul mice and other small creatures, but I think, in my opinion, that’s more idle practice or just playing with their food. I hope. Because doing something for ’sport’ means a capacity for comprehension and choice-making that I would just as soon cats not acquire.
But coyotes? Oh, yeah–they’re capable of doing it just for fun.
gee, I didn’t know cats killed for fund. As someone who lives in the suburbs and not in the country, I thought cats, like kittens were practicing their hunting skills.
I am not an expert on this subject, just what I read and heard. (Stupid city dweller)
lol
“I thought cats, like kittens were practicing their hunting skills.”
That’s what I mean by ‘…that’s more idle practice…’ when cats fiddle with their little squirming food things and then leave bits decorating the porch. I wouldn’t call it ’sport’, per se, but I guess it depends on your definitions.
One of my friends is a marine biologist and has participated in some of the tracking and research of the orca pods, transient and resident, of the Puget Sound area and he told me some interesting stories about orcas ‘playing’ with their food bits (harbor seals). Since none of us bald monkeys speaks orca, we cannot know what’s going on in their big convoluted orca brains. They are certainly very intelligent creatures, and communicate with each other. He was telling me about an event, with a transient pod that got hold of a seal and batted it back and forth to each other. It was a fur bag of mush after the first swat, and ready for tasty snacking, so it was hardly hunting practice or efficient meal preparation. (they didn’t even eat it, even when it came apart.) More like picnic-going co-eds enjoying a fun game of volleyball on the beach. Party-time! Except that vacationing co-eds don’t merrily smack a dead ball back and forth in front of a bunch of watching living balls, before chucking what’s left back on the beach and swimming off.
(okay, repost)
And the moral of that story is: This is why I will not kayak where orcas are known to habitate. Big, highly intelligent, ‘playful’ marine predators? Combined with a small pink meat tube floating in a plastic kayak? Fook! I’m practically a Slim Jim!
“Only man kills for sport., from what I have heard.”
Tell that to my dog. Much to my displeasure, he’s been a killing machine since he was a pup. Raccoons, cats, rats, mice, opossum, birds, beavers, skunks, porcupine, nutria, moles, voles, coyotes, deer, he’s chased all of them, and killed many. He doesn’t eat even a morsel. His tail is happily wagging when he gets something.
I had a miniature poodle growing up. She was a good dog but had a nasty habit of digging up baby rabbit nests. The ultimate atrocity occurred when she entered our house one day with a rather smug look on her face, happily wagging her tail. She gently burped, and out popped a partially-digested baby rabbit on to the living room rug.
Ewww…
You fish saltwater or freshwater, PB? (or none of the above)
Crowds at a mall in So Cal mean nothing. What else do people do in So Cal? Malls, trendy restaurants, and a plastic attitude. That’s pretty much it.
LOL! SoCalers love to wax about how wonderful the weather is, yet they spend most of their time indoors: at work, at home, at the mall, in their cars. How often do they really go to beach (plus the water is cold)?
Took my sons to Mimi’s Cafe (a popular SoCal franchise restaurant) for dinner last night. In January 2008, our family went there for dinner on a Saturday night but left because of the forty-five minute wait for a table. Last night, at about the same time on a Saturday evening, there was no waiting plus half the tables were empty the entire time we were there (6pm-7pm). The food quality is clearly suffering as a consequence of the drop in demand.
i was in a local supermarket yesterday and it was crowded but all the other stores in the shopping center were dead
(food prices have got to be killing large famalies everything is close to 20% more )
btw there was a woman creating quite the show arguing with the cashier about an item for $1.49 she says she did not buy
things are great here
also yesterday i took my wife to the lower east side of nyc for
a spring leather jacket (she had this money since x-mas for this purchase) and instead of the one jacket she was going to purchase at another store last week she was able to get 2 beautiful jackets and still has money left over for a pair shoes
these guys were starving for business and paying cash only made the price drop even faster
lots of open house today and not much reduction in prices
but you read the local papers and every article is about the horrible economy, cancelled major projects in the nyc area and so many people struggling
how much longer can this charade last? i am talking about outer boro’s not even manhattan
Patience, young Grasshopper. Remember how stubborn California was. And look at that disaster. Check out the flip shows coming out of California (as I’ve documented below). The mentality here is changing and the average Joe is beginning to understand what’s happening. Banks are not lending. The patient has died. He just won’t lie down.
On another note I went to the Auto Show yesterday. That was so painful. The only thing I want to own less than a house is a car. I cured my headache with a plate of oysters and a few beers on Bleecker Street. Give me beer. Keep the depreciating assets for somebody else.
I don’t even have any interest in owning a car. With rapidly escalating costs of gas, people will start walking, biking, busing or carpooling.
Gas is still cheap, it’s just been in a couple decade long depression that everyone has gotten addicted to. Sorry if that’s not a popular comment but I grew up in Texas and remember my dad having to lay off friends, then get laid off himself when the Arabs cut the crude price so bad it just about decapitated the U.S. oil production industry.
Well, look up peak oil, we are running out. Time to go green and forget driving, it sucks anyway.
I get about 42 mpg and outperform almost anything on the road. Motorcycles work just fine for me. It costs $15 for a full tank of premium gas at current prices.
Better buy up some more life insurance.
bye fl
i would rather buy a motorbike and ride without a helmet then live in a town that homes sell for 50k in
In this case, you might want to stay in NYC forever in order to avoid paying too little for a house that the rest of us middle class people will enjoy. When this bubble deflates fully and the market bottoms out, youll have a hard time finding a town with houses costing over $50k.
Comment by Bye FL
2008-03-30 07:07:44
Better buy up some more life insurance.
Why?
Is there a glock shortage?
Because motorbikes/motorcycles are very dangerous. I know no shortage of stories of accidents. With a car, you have some protection.
Motorbikes are very dangerous.
So is war in Iraq. So is terrorism financed by petrodollars. So is Irans nuclear program. So is Russia rolling back democracy and giving the US and Europe the finger. So is famine as food becomes more and more expensive. So is a collapsing US economy built on cheap oil.
There are a lot of dangerous things out there.
Comment by Bye FL
2008-03-30 08:30:13
Because motorbikes/motorcycles are very dangerous. I know no shortage of stories of accidents.
With a car, you have some protection.
From a glock?
‘i would rather buy a motorbike and ride without a helmet then live in a town that homes sell for 50k’
I don’t like wearing a helmet on a motorcycle. I like having my hair flow out behind me in the wind of my passage, more picturesque and Easy Rider-like. It’s much funner. The problem with that is: 1) WA has a bitch of a helmet enforcement law, and they truly mean it. 2) I have long hair and the wind of my passage whips it into a horrid felt rope sticking off my head and boy, does it hurt to comb out. Screaming and howling time, and not a bit picturesque. 3) I’d probably be less darling with half my skull embedded in a tree trunk and the rest of it spread out in a clumpy red streak along the road, should a ride ever go wrong.
So I wore a helmet. And, when I get a motorcycle again, I’m looking for one on deep sale from some FB sap getting forcibly downsized, at that time I will wear a helmet again.
Motorcycles are not dangerous. As an expert, riding and racing since 1965, I have found that most motorcycle accidents are caused by agressive auto drivers. Everyone knows of Sturgis. This is the only place i know, where motorcycles are dangerous. They are dangerous there, because of the nebies on Harleys total ignorance of the word RESPECT!!!!!
P.S. Former outlaw!
You can kill yourself in a car, you can kill yourself on a motorcycle. Once we get past the thrill seekers, there is one inescapable truth proven time and time again by statistics and 911 calls:
The most dangerous thing about riding a motorcycle is drivers of automobiles.
They listen to the radio, talk on the cell phone, eat, drink, smoke, play with GPS, play with kids, play with dogs, put on makeup, change pants, read the newspaper, swerve, and do a dozen other things that threaten the lives of people who are safely riding motorcycles.
As a result, I support $5 a gallon for gas. Hell, I support $20 a gallon for gas. People bitching about SUVs have, in my opinion, a strong element of narcissism in their complaints. You don’t become a Good Person (TM) by driving something other than an SUV. There are far too many automobiles in the US. Period. $25 a gallon for gas works for me too.
glocks rule. Just today, I was in a match and a guy’s 1911 keep jamming, his wife’s XD was screwing up, and even another guy’s revolver was fubar. Two of us had Glocks and absolutely no problemos.
Oops, wrong board…
well you saw my pimped out ride
so you know how much i care about cars
did you get the tix from work?
No. I paid at the gate. I went to please others. I took one for the team.
Because motorbikes are dangerous
So is current war, w 4000 dead
So is terrorism and Iran’s nuks financed w petrodollars
So is famine that will occ as oil continues to spiral higher
So is economic collapse that occurs in the USA a country designed with a belief of eternal cheap oil.
Those leather shops on the LES have always been really, really cheap. I see people spending as much as ever in NYC.
true i just went because i love to haggle and negotiate
I am getting ready this morning to go out and shop for a suit. I’ve never been one to dicker and I normally use a CC (which we pay off every month) for the convenience. But today I plan to bring cash and see what kind of discounts I can get.
RE: Large regional mall was PACKED on a sunny spring day. However, not a lot of packages being carried around.
Brain dead American consumer lemmings don’t know any other way of life.
They will head to the malls because of the cheap A/C and stuff their faces in the food courts whether they have money in their pocket or not.
The Foreclosure Machine
http://tinyurl.com/39tsag
Joel B. Rosenthal, a United States bankruptcy judge in the Western District of Massachusetts, wrote in a case last year involving Wells Fargo Bank that rising foreclosures were resulting in greater numbers of lenders that “in their rush to foreclose, haphazardly fail to comply with even the most basic legal requirements of the bankruptcy system.”
For years, consumer lawyers say, bankruptcy courts routinely approved these firms’ claims and fees. Now, as the foreclosure tsunami threatens millions of families, the firms’ practices are coming under scrutiny.
Pamela L. Stewart, president of the Houston Association of Debtor Attorneys, said she has become skeptical of lenders’ claims of fees owed. “I want to see documents that back up where these numbers are coming from,” Ms. Stewart said. “To me, they’re pulled out of the air.”
There was a lack of scutiny during the bubble, so it’s not surprising that there is a lack of scrutiny during the bust.
Thanks for posting this. Shows that some being foreclosed on are truly victims. The “let them all hang” crowd here should understand that some were and still are taken advantage of.
Either they are adults capable of making their own decisions, hence responsible for their own actions, or they should be incarcerated for their own safety (as frugally as possible, as taxpayers will have to pay for it in many cases). Those are really the only two possibilities. So if they want to claim victimhood, then they must be prepared to be placed somewhere safe for the rest of their lives.
Re lenders’ claims — I have always been astonished at everyone’s failure to question lenders, including me. When one of my clients wants to sell a place, I typically get a request for a payoff statement from either the seller or the new lender. In one case about 10 years ago, a seller wanted a payment history from me. In all the other dozens and dozens of cases, someone just took my word for how much was owed me. Why I have not been tempted to cheat is also very curious. I am perpetually tempted to cheat on my income tax (although I don’t actively do it, for fear of being caught), so it is not a matter of my being innately honest. I guess in the case of the borrwers, the bookkeeping is so simple that I would be hard pressed to back up any fraudulent claim on my part. Plus, the borrowers have been given an amortization schedule at the outset, so they have a good chance of knowing the balance at any time. Plus, I don’t resent the borrowers the way I resent the tax man.
my county, fairfax va, is claiming a loss but wants to buy more housin fo da poor because it’s such a bargain.
fair to say? the bottom is when it’s cheaper to own than rent on a cash flow basis.
Were you wearing black face when you posted this?
“cheaper to own than to rent” didn’t happen at the bottom during the 90s land crash in California, we rattled along the bottom 1993-1996 but the dotcom boom pushed up rents and prices equally through 2000, then rents went to the moon in 2000 but prices were held back by the stricter lending standards of the time.
It would absolutely have happened in SoCal, and probably did in some pockets, but rents also declined sharply during the early-mid 1990s, which may have kept real estate “above water” in that sense. But it was certainly comparably cheap to own versus renting - which one came out ahead depended on your assumptions about tax rate, maintenance, insurance, etc. These days it’s not even close, with or without those factors. But we’ll get there again in 4-5 years, I have no doubt.
P.S. I lived in a rent-controlled apartment in LA at the time, so that skewed my calculations. But even as early as 1998, the market rents had risen high enough that I strongly suspect that it was then cheaper to own than to rent. This may have been true even as late as 2000, because market rents kept climbing whereas house prices didn’t start skyrocketing seriously for another year or so. By 2000, when an apartment went vacant in my building in the Fairfax district, it rented for $1795, versus the $1050 I was paying for the identical unit that I occupied four years earlier. That’s a 70% increase in four years. House prices didn’t do that, not that early.
jbunniii,
In certain areas, prices started screaming upward in 1997. That’s when I started seeing the flipper/speculators come out — the real, old-time flippers and not amateur housewife flippers.
I lived in LA during the last downturn and bought in San Diego at the bottom (because I still couldn’t afford LA on a single income). In both places, you could find a home that you could rent for positive cash flow from day one, with 20% down. Fairly decent areas, too.
How to Cast a Mortgage Lifeline?
http://tinyurl.com/34skhn
In the Frank-Dodd approach, existing mortgages would be bought below face value, forcing investors to, as they say in the trade, “take a haircut.” But homeowners who get nice, new mortgages to replace their nasty old ones should also be made to pay for the privilege. If not, the Super F.H.A. would be flooded with applicants. So the proposal would make homeowners relinquish part of any price appreciation on their houses for as long as their Super F.H.A. mortgages remain in effect.
Good idea. But I’d go further, by also making beneficiaries of the plan forfeit the right to take out second mortgages or home equity loans.
I can hear the NAR now; buy now or miss the bailout!
I wouldn’t be surprised if one of the “unintended consequences” of this crazy quilt approach to the so-called crisis is that it makes actual home ownership tougher on creditworthy people. I notice, for example, that no one’s talking about rolling back the bankruptcy laws to where they were before CONgress decided to suck up to the banks in a big way.
This idea of keeping people in their homes may well be related to keeping property taxes coming. I check a few areas in mid-coast Maine and upstate NY just to watch the prices, which may be coming down some, but the taxes will still eat you alive. A lot of the effect of Bush’s tax cuts was to shift the burden to states and local areas, which are getting slammed by foreclosures and unsellable homes. Price declines aren’t enough, it’s changes in demographics and the local tax burdens that have to be watched.
And add employment prospects to that mix…
Very observant spike. You home runned. The property tax burden combined with fuel oil and gasoline prices have put a massive squeeze on NE. Add to that declining wages and non-existence jobs equals an extremely gloomy forecast. I’m amazed that my family and friends there cannot see it. Many of them still believe the Mcmillionare boomers are coming to buy their “infestments”. The don’t follow through with that logic and realize that those same boomers are headed to the grave and a rapidly escalating rate leaving massive inventory everywhere.
It is not the job of the federal government to subsidize state hand out programs. I’m very glad that the local homeowners in places like Maine are finally experiencing the costs of crazy local programs, such as school districts with a couple of hundred students with dozens of administrators.
schools are already paid for with local taxes.
The Federal goverment takes that money from the states
Schools and other state social programs and other pork are paid from a combination of federal, state and local money. It is idiotic for a state to have a multiple school districts with a few hundred students and dozens “administrative” folks that make such school districts run. It is idiotic for municipalities to build $30M school sports complexes when their pupils struggle to add or subtract whole numbers by the time they are in fourth grade.
40% of the teachers and administrators at my kids’ school are dedicated to special education. Right or wrong, that was not a major drain on resources when I was a kid.
“If not, the Super F.H.A. would be flooded with applicants.”
‘…flooded with applicants…’ = the Achilles’ heel of D-ratic giveaway programs.
The upside: There may be many applicants, but at least you won’t have to dole out the dough in $29 bn chunks.
They will say screw you banks and walk away or sell the house at a loss since the bank will end up keeping any appreciation so why price it high?
PB, that “Achilles heel” point is so good…none of us would mind supporting the 2% of people who can’t support themselves. We are just tired of supporting all the people who choose our support when the opportunity is available.
Let’s just say there will be lots of lobbying money spent on assessing the “right” value for the government to buy the mortgages. That’s where the huge bailout comes in.
Hey, I’ve got an idea? What not replace the purported treasuries in the “lock box” with 2004 to 2007 vintage mortgage bonds? This would allow those over 55 to HELOC again and spend some more money.
All I saw when I read that article is, “the middle-class gets f–ked once again”. I don’t think this piece of crap will fly but it is just a socialist piece of garbage. It demonstrates how detached from the real world these morons really are. And that picture of Dodd makes you want to punch him right in the face.
So must love Paulsen’s plan to give the Fed more power and let Wall Street regulate itself.
Nope. I hate that idea with every inch of my frame.
Every inch, eh? Even the “inch worm”?
2008 = the year USA turns Japanese
years to know
1921- gov did nothing = biggest recovery from the biggest cpi loss
1033 gov did everything and depression lasted 10 more years
1990 Japan saved jobs, created jobs and bailed the banks= still in recession
BTW:CAN someone repost the turning japanese song redo in housing bust lyrics
Why would anyone want to own a home when any future appreciation they don’t get to keep? They will still just walk away.
Because they want to be able to paint the walls! No price is too high for that privilege.
you can paint the walls on a rental, just be prepared to do it twice.
“Why would anyone want to own a home when any future appreciation they don’t get to keep? ”
Pride of ownership… Bahahahaha!
The idea behind this is that some people simple want to live in their home and the concept that its “an investment” or a “path to wealth” is meaningless. If they stay in their homes and do not sell for a certain amount of years, their payments do not reset to become unaffordable. The lenders take the hit and only recover if and when the owners sell somewhere down the line for more than the reset value. These loans are insured, but are given only to owners that can meet current payments.
Seems a lot more moderate than what the Fed is doing with Wall Street now.
I keep reading all of the “bailout” articles and something has struck me. I think the main reason for the Bear Stearns bailout was to pave the way for more and more individual bailouts. All I hear this weekend is, “if they can bailout Wall Street they can bailout Main Street”. It was clever to do Bear Stearns first to justify all the rest.
I am so sick of one wrong being used as justification for another wrong. I’m not flaming you, Ed. I’m just venting.
I actually agree about that. But I don’t think the Government stepping in to modify loans that the borrowers are currently paying as a bailout per se. The lenders lose whatever lower price the house eventually sells at and the owners get to stay in their home but not build equity.
I don’t think the Feds or Wall St. had any thoughts of the FBs. They are too greedy and selfish a lot for that.
Look at the Paulsen plan. No help on mortgages, Wall St regulates itself. Good plan!
I think the main problem with all of these plans to help borrowers is that they ignore the fact that the best option for a good many of them is foreclosure. If someone were proposing something to help people through foreclosure I think I would be able to stomach some of the other things that are being proposed. What I see with most of these “bailouts” is nothing more than loss mitigation plans for the lenders. It is not possible to help someone with a $40k a year income who has a $3k a month mtg payment. I think a lot of this goes to back to the cult that has been built up around home ownership. There are many who view home ownership as a positive no matter what the costs are. Many of these bailout plans will take borrowers in a bad position and bury them in debt for the rest of their lives. Better to let them walk away, take the credit hit and start building up some savings.
I for one hope and trust that the recipients of bailouts in the form of mortgage balance write-downs will have that embarrassing failure duly noted in their credit reports.
NYCityBoy,
Actually I think the precedent was set with the stimulus package. The Gov’t drops $160 Billion from helicopters (to everybody, including non-earning retirees and veterans). At that point, I knew it was off to the races. $30 Billion to bail out JPM/Bear Stearns becomes something of a footnote after that first $160 B became history….
Job Market 2009
http://www.youtube.com/watch?v=O2uErWWwQTo
reply to comment in yesterday’s Bits Bucket:
Comment by Lostcontrol
2008-03-29 08:41:56
We are dead ducks! Both parties are basically pushing the same policies. Where is Ralph Nader when we need him?
———————–
Ralph Nader is running, and this is his site:
http://www.votenader.org/
He was on Lou Dobbs last night talking about how all the other candidates were/are taking money from the subprime lenders and he was not.
Personally, I can’t bring myself to vote for any of the other candidates, and though I don’t agree with all of Nader’s stances, at least we all KNOW where he stands because he has a record of his many accomplishments.
Some good info here:
http://www.nader.org/enbio.html
Yep, I, too, may not agree with all of Nader’s positions, but he’s one guy who does look out for the people. I’m either voting for him or writing in Ron Paul. The three invented CONdidates give me the dry heaves for one reason or another.
An interesting tidbit I learned while researching Nader was that he was behind the “Freedom of Information Act.”
Definitely a “for the people” guy.
I voted for Nader in the past two elections, and was subsequently told off, repeatedly, by Democrats who blamed me for costing them their presumably divinely-ordained victories (an especially stupid accusation, since I would never have voted for Gore or Kerry; I would have simply have not voted at all). However, I discovered Nader’s running mate last time was a true lunatic, and I’ve decided to be a bit more cautious this time around. Nader really has been an advocate for consumers for decades, but some of his political ositions are a bit nutty, and one has to weigh the pros and cons. Be warned, if you vote for him, you will be screamed at for years by so called tolerant Liberals if their candidate doesn’t beat John McCain.
Thanks, CA Renter,
I don’t know about you or anyone else on this blog, however, good old “Ralphy” seems to be the only honest and desirable candidate running (He is running, isn’t he?). Anti-big business and anti-corruption. A great independent ticket would be R. Nader/R. Paul.
I would vote for this ticket over Reps or Dems.
“A great independent ticket would be R. Nader/R. Paul.”
Love to see that one. The two would balance each other out, I think. In any case, I’m not voting Rep or Dem this time around. That is, assuming we get to the elections with McCain vs. Obama or Hillary. Lieberman as Veep is a foregone conclusion for McCain. I got a big kick out of the video footage of Lieberman all over McCain in the Middle East, like a cheap suit in the rain. Reminded me of a clip from “Weekend at Bernie’s”.
Nader was interviewed a few weeks ago on Meet the Press (I believe it was). He was making some sense then they brought up the mortgage mess. He jumped in, with both feet, to the “they are all victims” line. He said how he would help all these people that were preyed upon. There would have to be government money used, etc. Blah, blah, blah. Not exactly a dream.
I suggest Ralph consider using this slogan, “A vote for me is a vote for McCain.”
If you hate Democrats, then vote Democratic this time around. If you hate Republicans, then vote Republican. The poor sap who gets the Presidency this time will be vilified as a failure just as W is. Remember that the new Pres will have to preside over the failure in Iraq, the housing mess, the credit crunch, a global meltdown, and the blowback from these events. I do not envy the next Administration. It will be thankless.
Roidy
ACH, you are making sense, yet I think we could see some surprises. For example, McCain might end the Iraq war (Nixon went to China) — because, who else could get away with it?
Amen, ACH.
I pity any of the poor saps who get voted in in 2009 - they’re going to get blamed for the woes of America, even though the damage was done well before their term started.
As for Nader - I’m all for Independant/3rd Party candidates, but he was born 2 years before McCain (Nader 1934, McCain 1936). People are already saying that McCain may be too old run, so how is Nader going to deal with the same accusations?
Its not my opinion - both of them seem very fit, healthy and active, but it does pose a problem - especially amongst those that think that the Presidency may be too much stress for a Septugenerian
” I’m all for Independant/3rd Party candidates, but he was born 2 years before McCain (Nader 1934, McCain 1936). People are already saying that McCain may be too old run, so how is Nader going to deal with the same accusations?”
To me, Nader projects a lot more alertness and vigor than McCain, which is understandable considering McCain spent a number of years under torture. It may be just a perception on my part, but Nader or Paul seem equal to the job and age not a factor, whereas in McCain’s case, he just comes across as old and doddering, as much as he’s trying to hang in there. Given the amount of stress that McCain has had in his life, he’d be best off retiring and taking it easy and enjoying his family. This job is not for him, IMHO, despite his protests to the contrary.
ach, what if the next president succeeds in all these failure or our current beloved president?
if Nader is so good why does he go into hiding and do nothing between elections - might as well not vote
He doesn’t go into hiding.
See, he actually works to improve the lives of Americans (and others around the world) instead of wasting time and money campaigning and politicking (sp?).
Read his bio and check out his accomplishments.
Seriously, I’m not a shill for Nader, and am strongly opposed to some of his ideas; but overall, he is on the side of the middle-class — and he is the only with with the accomplishments under his belt to prove it.
He doesn’t talk, he acts.
I just contributed $50.00 to the cause.
Investment Bank Lehman Brothers to Sue Japanese Trading Firm Over Alleged Fraud
http://tinyurl.com/2j5z4f
Marubeni said in a statement Saturday that it did not secure the loans, and documents to that effect are fake. It contends that it is also a victim of the alleged fraud and therefore should not have to cover any damages.
Ah, I love the smell of lawsuits in the morning!
Lol.
If I were still in private practice, I would tell my clients to tape the signing of all closing documents and keep the originals in safe deposit boxes with records kept of all times the box was accessed and whatever other evidence I could think of to prove that signatures were legit. Just trying to pretend you didn’t sign something is going to be a huge temptation.
Unfortunately, for those whoes signatures may be forged, it is way harder to prove a negative.
…..speaking of affordability……
http://www.buffalonews.com/149/story/311329.html
“The key threshold, when the programs begin paying out more in benefits each year than they collect in payroll taxes, is projected to be reached this year for Medicare and in 2017 for Social Security.
The calamity will build, as the population bulge of the baby boom draws more health and retirement benefits and leaves behind a smaller work force to pay into the systems.
Unless Congress begins to work now to fix this problem, more of today’s children are going to have to make tough decisions in balancing care for seniors and their own children’s education.”
Just add it to the pile of increasing costs chipping away at the American budget and therefore funds for housing. Between the potential of deflating wages (which happened after the first few years into the Gr Depression and is a stark reality in our global marketplace) and increasing financial obligations I’d be signing any mortgage agreement with trepidation.
Thats why more and more people should not have children. They gotta take care of their parents.
That’s not at all why more and more people should not have children. More and more people should not have children because they are f–king worthless losers. Any do-gooder out there can take a ride on the subway and try to debate this point with me.
Not caring for your aging parents, I take it?
One reason ill never have children is I want to allociate resorces to care for my aging parents. The world doesn’t need more people!
When I grew up Blue Skye, we lived without. My parents scrimped and saved. They took care of their retirement. That was smart, even if us kids didn’t understand it when we were young.
I tell everybody at work, the best thing you can do for your kids is to properly fund your retirement. They look at me like I just took a dump on their mouse and then proceed to shop for sh*t the kids don’t need.
I hear that. When I grew up we scrimped and saved too. My mom and dad were obliged to offer some aid to their respective mothers, which they did without (much)complaint. My father made provision for my mother, which is proving inadequate only because of relentless inflation. My sister and I provide additional support, without regret. It seems fair to us.
When each generation saves, they are much better able to look out for each other.
sounds more like those guys a long time ago during the last world war.
““I just smiled. Hubby and I were saving for the diamond, and we decided used furniture was a better fit. Yes, we saved for a rock, it’s modest and I actually prefer other gemstones to the ice.””
Dimaonds are a huge waste of money for many reasons. What can you do with a little pretty stone? And diamond prices are insane. Also we are getting technology that can create man-made diamonds. Finally you can just get cubic zirconia for less than .1% of the cost of a diamond.
It must be wonderful to have all the knowledge of the universe at such a young age.
In my ripening age, I have come to understand the tactics that DeBeers uses to control supply and maintain prices.
On another note: I used to work in a facility that would grow crystographically perfect sapphire and diamond. The diamond layers were microscopically thin (it grows about one micron per hour) but the sapphire was huge chunks. Inevitably, some of the chunks were discarded.
It’s amazing to watch the female response to large polished (discarded) sapphire. Just for an oxide of aluminum.
You could elict the same female response by handing over a box of chocolate(Godivia is popular) and she will devour it up in the blink of an eye(literally)
Debeer’s days are numbered. People are realizing that diamonds aren’t worth anywhere near those prices. That thousands of dollars could be going towards a downpayment or rent.
Another new decade-00 pet peeve that shows how mindless people are getting - the use of the word “literally” when you mean figuratively.
I can understand the industrial use of diamonds but their value is wildly over inflated. It’s just pure carbon folk!
You do know they will burn? Diamonds burn in pure oxygen at about 1320 degrees Fahrenheit. In air (which is about 20% oxygen), the temperature raises to around 1560 degrees Fahrenheit.
Actually he is right on this one. Debeers is the only monopoly in the world. The greatest marketing in history—convicing the US women that diamonds are precious stones when they are only semi.
It may crash some day but not anytime soon.
Precious and semi-precious are not terms used by mineralogists, or even jewelers. Certain types of stones are rare and prized; they are considered “gems” based on an ever-changing subjective interpretation of the same. Sapphires and rubies, for example, are generally considered in the public vernacular “precious” stones whereas turquoise is “semi-precious,” but this has little meaning as to value. Diamonds are pure carbon, and generally are thought of as a separate category from “colored” stones. All diamonds have a characteristic hardness and specific gravity, but even most diamonds are not “gems.” Most gems require cutting to achieve their highest value.
You are forgetting about RusAlmaz
Hi Tx!
That diamond quote was mine - LOL.
I sure wish I had all the knowledge of the Universe at such a young age!
Truth be told, we were dirt poor in $, beyond rich in love.
Leigh
let me guess bye you are not married
just a thought
Reminds me of a married fellow I used to work with. He had a decent income, no obvious lack of material wealth, but he told me he didn’t buy his wife flowers because they died within a couple of days, so it was like throwing money down the drain. My thought: You don’t have any kids, and you won’t get any* unless you start buying more flowers…
*Double entendre intended…
Maybe he buys her alcohol?
Are you suggesting alcohol provides more bang for the buck than flowers?
maybe somewhere between flowers and diamonds
trust me, a well timed purchase in the latter should ensure a ready supply for a long time
txchick — for clarification, are you talking about engagement rings, post-nuptial diamonds, or both? (I may have to reevaluate my portfolio allocation…)
Toe rings.
That’s not a toe.
“Belly button rings?”
That’s not a belly button.
Baby, that’s not even an inch!
” What can you do with a little pretty stone?”
Make a commitment to someone.
You of all people should know that based on your “website” about “mating”.
No, I am not married. Thank goodness
If you want to buy her flowers, buy her seeds and a bag of soil and instructions how to grow them. Much prettier and longer lasting.
You can commit to someone with your heart, not with a shiny stone.
“buy her seeds and a bag of soil”
I have to admit that I have never tried this path in the mysterious mating process. I’m more results oriented.
lol
I just bought a pretty pink sapphire a week ago.
tx you are such a girly girl
personally my wife likes diamonds and likes the few nice
pieces i have bought for her
and you know what she deserves them
And what will you do when technology gets to the point that machine can mass produce perfect diamonds?
Got $10 for a 1 ct. diamond?
I just bought a pretty pink sapphire a week ago.
That is the type that we manufactured. (Sapphire is Al2O3, and the pink comes from doping it with titanium.) When the sapphire came out of the furnace it was a cylinder of 1 in diameter and 4-5 inches long.
Try and put that on a ring!
It turns out that they are useful for lasers, which is why my group was growing them.
A lot of women like diamonds but there’s nothing more special than a pearl necklace.
Ohhh, somebody had to type it after this painful diamond discussion.
Thanks NYCityBoy for that Ron Jeremy and Barbara Bush visual. Insert fork into eye…
“You can commit to someone with your heart, not with a shiny stone.”
Okay, Bye FL doesn’t need me, or anyone, to defend him but he’s RIGHT about this. I’ve been married nearly 19 years and I don’t own a diamond. My simple gold band will do. I’d rather have cash and investments than shiny rocks.
If shiny rocks are what other women want - fine with me. Just so I don’t have to pay for it.
I never wanted kids and I HATE jewelry. So I know I’m not normal.
A blood diamond is forever.
My gf wouldn’t take a diamond on account of social concerns. She sports a modest ruby and is quite happy with that token.
I just sit back and enjoy watching the new flip shows. Last night was a return trip of flipper “Arthur” on “Flip That House”. He admitted that he was renting out the last flip he did in Downey, CA. It would be hard to count all the times they stated that the market in terrible is California.
He was looking at potential new flips, to either sell or rent. What a dunce! The prices were still way too high and he was still complaining about the weak market. I saw houses that should be $150,000 going for $469,000. So, bonehead rocker Arthur, buys his new flip for $340,000. He does almost nothing to it but spends $5,000. He didn’t want to spend too much because he hadn’t decide to sell or rent it.
The finale was great. The “REALTOR” told him she thought he could get about $300,000 for his palace. That was okay with Arthur because he would rent it out. The rental price would be $1,500 which would cover the mortgage. WTF? If he financed $340,000 his mortgage should be $2,500 on an investment property. I smell an interest only loan with a teaser rate.
Conclusion: California is f–ked and getting f–keder. As Bobby Knight once said, ” just lie back and enjoy”.
at least the brokers are “working” harder for their 6%
http://www.nytimes.com/2008/03/30/realestate/30cov.html?ref=realestate
“Because the New York City market is growing increasingly stressful — sellers worry the peak has been reached and potential buyers are reluctant to commit for fear of paying too much — more is being asked of brokers.”
Good lord, I think reality might be in site.
why don’t folks chop the 6% off and list on craigslist ?
too simple I guess
Actually $340,000 pencils out to $1400/mo carrying cost for me:
IO: $1558.33 (5.5%)
PMI: $240.83
Prop Tax: $350
Less Tax Credits For Above Costs: ($800)
Subtotal: $1353.74
Insurance: $80
Monthly carrying cost: ~$1450.
(IMV, counting prinicipal payments as part of the carrying cost is incorrect, since you’ll be getting that money back with interest unless you walk away)
“you’ll be getting that money back with interest unless you walk away”
You’ll be getting that money back unless prices are declining.
Anything for maintenance or do you have the only renters in the world that don’t do damage to the domecile? A former co-worker back in 2001 had to put $16,000 into a house to fix it up after a tenant left. That place was renting for $900 at the time.
Methinks your pencil creates voodoo economics.
NY-
I watched that show last night and I could not stop laughing. The guy drives a Ferrari and lives in a disgusting RV, and he “owns” at least two homes. I knew he was a jackhole when he was demmo-ing the windows by throwing rocks from the outside into the house.
I commented to the spouse, that I was thrilled that this program is showing all the warts and pimples of house flipping. I also love how TLC runs a disclaimer at the beginning of each show “Flip at your own risk”
I always wonder who would agree to go on that show. I think Arthur may have gone on the show just to promote his rock band, no one can be that stupid. But I have a friend who’s sister-in-law went on that show and lied about everything. The cost of the house the cost of her supplies and the sale price. She said she went on the show to get deep discounts from retailers, but she still managed to lose 25k but she lied and said she walked away with 80k.
One had this, “We cut up the last credit card 2.5 years ago, and if I want a TV I have to save up to purchase it. Of course I won’t roll in there and spend 5K on a TV, because when you pay in cash you feel the ‘pain of purchase,’ and suddenly you start thinking things like ‘hmm, I can buy a 1k TV, take a 1K trip, throw 2k in savings for the kids education, and buy new laptops for the whole family for 1K.’”
“Nobody would make those stupid purchases if they made them with cash.”
And that, is why I don’t use credit cards except to purchase online for my business. My dad uses credit card to buy food. Cash is king.
Hey that quote was from me Bye!
Another leg on the Florida bull chair kicked out
http://www.miamiherald.com/news/florida/story/474647.html
“Even with slow growth in population statewide, there is one county likely to enjoy strong growth: tiny Lafayette County in North Florida. It is predicted to grow the fastest in percentage terms between 2007 and 2010 because of prison construction, Smith said.”
Prison construction. A real up and comer, eh? Let that sink in. Kinda scary. Because when they privatize the prison system, everyone’s a potential criminal.
Because when they privatize the prison system, everyone’s a potential criminal.
I don’t quite understand this statement. Even if the prison system were privatized it still requires a gov’t (with it’s monopoly on the use of force) to send people to the prisons in the first place.
As far as “everyone” being a prisoner. No need to privatize. The current US gov’t (combining local/state/federal) is the most efficient in the world in imprisioning it’s population. We currently hold the title for the largest prison population in total (beating out China) as well as the largest prison population rate per capita.
No reason to worry about privatization but you should certainly be worried now.
“Because when they privatize the prison system, everyone’s a potential criminal.
I don’t quite understand this statement.”
When private companies are reimbursed per day per prisoner, I would imagine the prison population and length of incarceration would swell quite a bit. And that could well be why we have such a large prison population at this time, because it is partially privatized. Would be interesting to see a study comparing the increase in the prison population to the time line of when privatization began.
Now if you think it requires a government to send people to prisons in the first place, I’ve got one word for you: Blackwater. Check it out. The gov’t is scared crapless of Blackwater, no lie. Especially considering Blackwater “guards” folks like State Department dignitaries and Congresspersons travelling abroad.
Yep, I’m concerned over this fer shure.
So you are saying that blackwater derives it’s power from the gov’t officials it protects? I’m just making sure I understand your statement. If that’s the case, that’s not “privatization”. When a so-called “private company” gets power from and paid by gov’t and does work at the behest of govt, that’s not really much of a “private” entity is it?
blackwater? a small player. i believe they are just the fall guy. 1b contract in 5 years! the big players get billions per year and you hardly hear about them.
Im emailing that link to my parents. Everyone does *not* want to live in Florida. Even I dont!
The lower rate of growth is caused largely by people leaving South Florida, where the cost of living is driving them away from the region.
Exactly. Can’t wait to be out of here. Even the heat is driving me insane.
Why bother emailing them? Sounds like you live with them. Just print it out.
As someone else pointed out, because of all the people who retire there to die, Florida is leaking out of both ends. It truly is “Gods waiting room”
True. I have been on the Gulf Coast my entire life. Think about Florida this way. Everyone must evacuate the coastal region during these big hurricanes. They have to board up and take care of pets, businesses, etc., and then they have to get on the road for 16 hours. Oh, they will alright. You get someone who has never been in a big one go through that once. They won’t stay for the next one. Anyway, this gets tedious when your 70 or older. Florida for retirees? You’ve got to be kidding. Look up Wilma and see what they went through.
Roidy
The only explanation is the lack of winters seem attractive. My parents think ice and snow is the worst possible thing. Meh I think ill be happier in PA than FL
Bye Fl,
Did you live in Oldsmar?
Roidy
“‘We’d like to see the values of our homes increase when the market increases, and not decrease because of KB Home’s decision to change the demographics of this community,’ she said. ‘We’ve all put a lot of money into our brand new homes —- for most everyone here, the investment is over a million dollars, and to turn more than 60 percent of this community into $300,000 homes … is not right, it’s not fair.’”
Waaaaa, Waaaaaa life isn’t fair. You bought at the peak and if this makes you feel better, the $300k homes are dropping in value just the same. You probably put next to nothing down. Just walk away!
The comforting part of the $300k homes dropping is that it is hard to notice such things when nobody is buying (”If a tree fell down in the forest but nobody was present, would there be a sound?”). By contrast, construction of smaller homes would naturally lead to sales and price (re)discovery…
““That offer got a few interested callers but no buyers — so, this week, bettershelter slashed the price to $499,000 and offered an additional $10,000 incentive for people who purchase the condos before April 15.”
“Zehnder said he suspects many people are waiting for the costs to bottom out. ‘I think they [home buyers] have a tendency to wait a little bit,’ he said. ‘These people are not experts. None of us are experts. But it’s a shame, because there’s really great deals out there and people sit on the sidelines, and by the time they decide to make their decision, everyone else is making a decision already.’””
By the time they decide, those who made their decision already a couple years back will have walked away and they will be able to buy from the bank for $250k
The Contra Costa Times. “Earlier this year, Eight Orchids was marketed as an upscale, Asian-influenced part of the revitalization of Oakland’s Chinatown. Developed by BayRock Residential, the 157-condominium project, priced the 770- to 1,645-square-feet homes starting at $550,888.”
“Now the developer will start auctioning 41 of those condominiums at $245,000 on Sunday.”
Big haircut but still very overpriced. Crazy that at the peak, some properties were as much as 5x overpriced!
On my annual pilgrimage to Key West: no wait at any of my fav restaurants; still a good spring break crowd; most retirees I know are limiting “going out;” wait staff saying it’s been slow etc.
Prices here are still insane.
I have to say I didn’t see too many ‘For-Sale’ signs in the middle keys.
Also, I chatted up a stock broker from the Midwest, he told me to, “wait two years” because we, “have a long way to go to the bottom.”
As usual, I acted surprised. “Really, but interest rates are so low!”
LOL, Muggy! If I were to talk to a realtor right now, I’d throw every one of their tired old cliches right back at them, with a huge, toothy, sunny smile on my kisser. “Whaddya mean it’s slow? Real estate only goes up! Everyone wants to live in Florida! Buy now or be priced out forever! It’s a great time to buy!”
Who wants to live in the keys? Miserable hot weather, hurricane central and ripoff house prices.
Yeah, but back in the day, it was a great place to kick back and PARTAYYY! Sorry you missed it, bye.
I’d kill to live there.
I wouldn’t kill to live here; judo chop, roundhouse kick, vulgar threats and maybe stab, but not kill.
It’s a fun place to party, but live there? No, it’s dull after a while. Great to visit but too far away from things. Miami is an eight hour drive. No big screen theaters, no real places to go, no museums, universities, no long motorcycle rides to new places, take a drive to New Orleans, Memphis, Dallas, or just out to the country? Not from the Keys. This is just me. I wouldn’t be able to handle it even though I like the place.
Roidy
“Miami is an eight hour drive”
We made it from St. Pete in 8.5 hours on a Friday during Miami rush hour. And no, I was not speeding.
Exactly. Might be good if you like going to the beaches everyday all year long. You guys can have the keys. I was on a cruise to a Mexican island near Cancun and god the heat was horrible! I was literally melting!
Even now as I sit and type, it’s 80 degrees in my room and im hot, sweaty and sticky. I am going to shower soon then fire up the a/c. I am so looking forward to cooler climates.
Bye: NW PA in summer will be well over 80 and intensely humid. NW PA in winter will be below zero. What fun.
“Even now as I sit and type, it’s 80 degrees in my room and im hot, sweaty and sticky. I am going to shower soon then fire up the a/c. I am so looking forward to cooler climates.”
Are you NAH from city data? You post the same crap over and over? Just move to Oil City and be done with it.
I can hate Florida with the best of them, but one thing is for sure: if I hated it more than I loved it, I would move tomorrow.
Just do it already.
How did Bye Fl end up in Florida in the first place? It’s not like its horrible hot humid weather is a well-kept secret.
went to key west in 98 and had a blast
I want to post regarding my credit card. Anyone else with Capital One receive their bill early this week (mine was Tuesday), with the due date next week? Maybe a problem with the USPS, however in the past I always remember having a couple of weeks grace? Perhaps a way to get $$$ from the sheeple due to the late fees & interest…
With the cc companies nefarious practices, I keep an eye on the cycle, call their 800# for a balance, copy a blank payment stub, and mail in a check (full amt of acct). I don’t rely on their timing, ever. 835 FICO
I noticed the window of receiving the stmt., and the due date shrunk on B of A too (formerly MBNA).
The lobbyists have done an excellent job.
i monitor my cards ( i use 2 amex and boa)
pay them the same day every month
i know my cycle so i stay on a schedule
i love those 30 day interest free loans
There are other flaws in the CC payment system besides the timing of the statements.
After you send in the check to pay your CC account, also verify that the check was received & posted to your account. Then save the canceled check. Years ago I paid the largest CC bill of my life with a check. The check was debited from my bank account, but never credited to my CC account. The bank on which the check was drawn had “lost” its copy of the check for a month. To avoid a penalty, I had to make a duplicate payment, which was sent by certified mail, return receipt requested. After some investigation, it turned out my payment had been credited to someone else’s account. The canceled check eventually was mailed to me, it had been torn in half & taped together. There was no endorsement of any kind on the canceled check, just a stamp of the date it was processed, no mark on it as to who processed it or where it went. I was astounded to discover there is no actual requirement that a check be endorsed & so no way to prove who cashed a canceled check.
For 3 months my money was floating in the ether, not drawing interest. Eventually I was given the credit for the duplicate payment. Then I canceled the CC account and the bank account.
Do it electronically in a sane manner and you will be fine.
When you receive the bill immediately electronically pay minimum payment. It should be posting on your account the next day. Once you are sure that the payment posted, you won’t be late and have the time to pay off your 0% interest loan in a way it is benefitial to you.
I have a Capital One Rewards Card, we use it for everything and pay it off every month, we redeem a $100.00 Target gift card every 3 months and use it for our toiletries.
That Bill has always come with a short leash for me, about a week before due, but I know this and always look for it.
Interestingly enough I asked to raise my limit, but I guess paying me $400.00 a year is where they stop at. Would of loved to throw the vacation last year on it too, could of got an extra $100.00
OCBEAR! I do the same thing… i use my rewards points at xmas every year to get gift certificates for presents! I LOVE doing this! I pay off my balance every month but i use my card for everything i can! Its so easy, it takes a minute to order whatever you want as a reward and you get it in the mail within 5 days!
deadbeat
Will supersized Jumbo loan deals available under the stimulus package have a marginal effect of increasing or decreasing former bubble market housing prices? It seems clear that housing market liquidity would increase due to an effort to put more monies into the hands of qualified buyers at price points up to $700K and beyond. But it is far from obvious to me which way the price effect will go, assuming the lending standards have truly been tightened compared to what they were a couple of years back. The claim that the measures are ‘temporary’ coupled with falling home prices and tepid wage growth makes the effect all the more unpredictable.
They are the next round of knife catchers.
That would be my guess, too, unless the talk about tightening lending standards covers up myriad loopholes which provide for looseness. It would become much easier to ignore any such loopholes if there were only one agency in charge of monitoring the entire U.S. financial sector.
Learning from Japan’s economic downturn
By Bill Emmott
March 30, 2008
(KAZUHIRO NOGI / AFP / Getty Images
Stock price board in Tokyo during the 1991 plunge.)
A little knowledge can be not just dangerous but grossly misleading. That is the right conclusion to draw from the latest, surprisingly reassuring data about the U.S. economy and from the interview in Thursday’s Wall Street Journal in which Sen. Hillary Clinton warned that America must avoid a “Japanese-like situation.”
Clinton should have researched what actually happened in Japan after its financial crash before using the bogeyman of a Japan-style malaise to support her proposal that taxpayers’ money be used to bail out holders of troubled mortgages. She thinks that Japan’s mistake was to rely excessively on monetary policy to rescue its economy, rather than on fiscal and other measures. The truth is the exact opposite.
http://www.itulip.com/forums/showthread.php?p=32118#post32118
Found via above:
Revolution Monday: The Bankster’s Coup
http://www.urbansurvival.com/week.htm
Thx chick
Zombie House Debt
http://news.bbc.co.uk/2/hi/business/7317470.stm
Interesting. I think the reason the mortgage servicers aren’t going after deficiency judgements is fear of a political backlash — and a modification to the bankruptcy laws. But if they draw it out a few years…
In direct response to the miserable advertising numbers that newspapers saw in the last quarter, the Washington Post decided to run not one, but two articles on what a great time it is to buy a home:
http://www.washingtonpost.com/wp-dyn/content/article/2008/03/28/AR2008032801996.html?hpid=moreheadlines
http://www.washingtonpost.com/wp-dyn/content/article/2008/03/28/AR2008032802997.html?hpid=moreheadlines
Love the heartwarming story about the couple that found their dream house in Chevy Chase…the owner perserved the 1950’s kitchen, and it had crystal door knobs, all for the low price of $600,000. Knife catcher.
Frugality is a skill that can’t be bought
By Caitlin Kelly
NEW YORK TIMES NEWS SERVICE
March 30, 2008
Consumers, long held up as the saviors of the American economy as it rose, are taking some of the blame for its fall. Critics now say consumers were too eager to buy big, expensive houses and fill them with the latest electronic gadgets. Consumers used their houses as piggy banks, these critics go on, to pay for their profligate ways. The question is, how do consumers learn how to deal with their finances? How do they learn how to save, invest and manage their money?
Where were these critics for the last 6 years? i thought housing was getting bubbly back in 02 and sold our place in the summer of 03. I though the crash would start in Jan 04, but had no idea the lenders would roll out IOs/ Neg Arms, and Greenie would start preching the virtues of short termarms when rates were historically low and prices were at all time highs.
The biggest question is, how do US consumers learn to save, invest and manage/hold on to their money in an economy based on extravagant/profligate consumption with a financial system rigged against their interests?
Less bang for a buck
Greenback’s decline has more people considering foreign investments, currencies
By Dean Calbreath
STAFF WRITER
March 30, 2008
To really confuse the situation, now that the U.S. hoi poloi is waking up to the U.S. dollar’s demise, the international central banking community must face the question of whether it is time to intervene on behalf of Uncle Buck in order to forestall a disorderly adjustment process:
Economics focus
Divine intervention
Mar 27th 2008
From The Economist print edition
Under the right conditions, currency intervention can work. So is it time to support the dollar?
How have those Asian stocks been doing lately? Ouch!!!
“How have those Asian stocks been doing lately? Ouch!!!”
GOLD doesn’t seem to be making much noise around here anymore.
I sold some two weeks ago. It was very disappointing. I only got a 40% return after 9 months. It might have been in dollars but it still buys plenty of Jack Daniels. And “no” I will not contribute any to H!llary no matter how many parties you attend with Rob Reiner.
Careful there, NYCB — you risk inspiring David Cee to bankrupt himself by going to bat for HC yet again.
I’ve been trying to buy a COMEX June 2012 gold call at 1400 strike for $9500 over the past week - you are most welcome to hit my bid and pocket 9500 in your account. GLD is at its 50d SMA right now, most likely forming a consolidation triangle. Support at nice round number (900) and 200d SMA. Someone has 150 calls at 800 strike for June gold 2010, the only options trading for that contract right now. Must have been some bet (or hedge). Nice!
It’s all Greek to me.
“These things develop over time. West L.A. between Westwood and Santa Monica was once SFHs — now it’s almost completely apartments. Same with Wilshire Blvd. between Westwood and Beverly Hills: residential towers now. Even the close-in burbs of Glendale and Pasadena have sold out their former small-town atmosphere for low-rise condo developments and smaller “mixed-use” developments.
But they forgot what increased density would do to the traffic… and the limited subway and commuter rail lines barely make a dent. L.A. driving commuters have progressively adjusted themselves to 40-, then 60-, then 90-, 120-minute commutes as they went further afield for affordable housing — but in the end, they found themselves paying half a million bucks to live in the freakin’ desert and spend 3 hours out of every workday sitting in their cars.”
Time to leave the city, if not the state. And that’s why many are leaving FL and CA as the standard of living has gone way downhill. Even western Pennsylvania offers a better standard of living when you aren’t crammed like sardines or need a 3 hour commute.
Job Market 2009. Pretty amusnig
http://www.youtube.com/watch?v=O2uErWWwQTo
LOL
That was great!
Wow — looks like the San Diego job market is expanding to the national scene…
Credit woes lead to calls for more bank regulation
By Joe Bel Bruno
ASSOCIATED PRESS
March 30, 2008
One of the casualties of the credit crisis is a long-held notion on Wall Street – that the investment banking community can take care of its own problems.
Some of these proposals would have the Federal Reserve supposedly “regulating” investment firms. MY question is, how can the Fed regulate anything? They’re not a government entity, and it would be the fox watching the henhouse.
The proposal to be announced tomorrow may be more about increasing market concentration in the regulatory business than creating a more effective financial regulatory system. Stronger laws and enforcement mechanisms coupled with greater decentralization in regulatory authority would seem to be the way to get more effective regulation.
Whatever. This is more about consolidating power, and shooting the SEC + CFTC in the head than anything else.
R.I.P. SEC 1934-2008
It would be much easier for one centralized regulatory authority to look the other way than for many independent regulatory authorities to collectively do so.
Naah, they are bureaucrats. Easily intimidated. Just threaten to take their cushy lives away.
Whenever there is a crisis, people try and consolidate power. This is normal.
Nice side show though.
It would be much easier for one centralized regulatory authority to look the other way than for many independent regulatory authorities to collectively do so.
Nice piece on credit card companies and regulation
http://www.pbs.org/wgbh/pages/frontline/shows/credit/interviews/mierzwinski.html
Credit woes lead to calls for more bank regulation
By Joe Bel Bruno
ASSOCIATED PRESS
March 30, 2008
…
“The fear among analysts is that too much regulation could hamper the companies’ ability to drive profits and in turn shift business to financial centers overseas.”
Sorry for the double post from the same story, but the temptation to skewer the dumb analysts’ remark overwhelmed me.
As I have said before, Americans are tapped out. Financial s are moving on to greener fields. This, I suspect if I was really cynical, is the new gold mine for financial corps. Give everyone in the world credit (credit cards, insurance and home mortgages). This ponzi scam is not over yet1
I’m leaving to spend a week in Poland, followed by a week in Israel. I’ll see if I can find any evidence of a housing bubble there. I suspect that Poland isn’t immune from folks thinking that sub-prime mortgages are their ticket to wealth….
(I presume Real Estate signs look the same everywhere….whatever the language. I speak no Polish.)
Israel might be less bubbly, I didn’t check much into house prices but my cousin bought a condo there and sold it a year later for the same money to buy a different condo. She wanted to be on the first floor because it’s hard to climb stairs when pregnant. The cost was about $110k US dollars(convered from sheqels) If there was no funny loans going around, not much of a bubble. Otherwise prices will adjust.
“it’s hard to climb stairs when pregnant” Oh pah-lease!
I guess you’ve never seen a step class filled with pregnant women.
Reuven,
I have a nephew who owns an apt. in Cracow; says prices were driven up by European investors and a strengthening local economy. Cracow is a pretty city, not destroyed by the Germans in WW2 as happened to Warsaw, and much less expensive than Prague. Poland is still very friendly towards Americans, and even with a lousy dollar, but get out in the countryside, and you’ve gone back a century in time.
Have a great trip.
There’s been a lot of news in the UK about all the young Polish workers who have made money there & lately have been returning to Poland in droves with their new wealth. That may cause a spike in housing prices.
Funny how politicians never worry about opportunity costs of bailouts. Did it ever occur to HC that throwing more monies down the REIC rathole might limit monies available to fund college educations?
GETTING GOING
Credit crunch will affect families’ search for college aid
By Jane J. Kim
THE WALL STREET JOURNAL
March 30, 2008
Why blow more air into the college costs bubble?
Point taken. However, I still maintain that pols are oblivious to tradeoffs when they propose to throw more money down the REIC rat hole.
The general utility-maximizing framework for politicians is to win elections. Obliviousness or non-obliviousness to all issues is irrelevant, or at least subordinate to U(x).
Sadly, I concur.
Government bankruptcy won’t occur, experts say
March 30, 2008
It’s no wonder consumer confidence is so low.
Yes, jobs are becoming harder to find as some businesses grow concerned about a weaker economy and hold off on hiring. In addition, many people are stuck with homes they can’t afford and harsher terms on credit cards. These conditions are not good for a slowing economy, and they could lead to more job losses and perhaps a deeper recession than some experts envision.
…
But while individuals can go bankrupt, “there is no risk the government won’t pay its bills,” said Anil Kashyap, a University of Chicago Graduate School of Business finance professor who has written extensively about the current financial situation. “The United States is nowhere near a crisis situation.”
CLICK!
They should go the Federal Reserve’s St Louis web site and read the paper
“Is th US Bankrupt” Laurence J. Kotlikoff
NPR just ran a story Sunday Morning where they profiled an auctioneer who works for the Virginia courts to auction foreclosed homes. He mentioned that there are more auctions than ever and “it’s not unusual” for nobody to be at the auctions. Law requires him to call the auction even if there’s nobody there.
hope we add more gov regulations soon- we can all have jobs that produce nothing
fha
fnm
fre
office of duper super-vision
From today’s Boston Globe - and this helps explain why healthcare is also in such a mess:
Carol Anderson, a hospital administrator in her 50s who lives in Dorchester, said she and her husband, a carpenter, make $70,000 to $80,000 a year combined and borrowed $465,000 to purchase their home with no down payment. To finance it, they agreed to two mortgages with rates of 11 percent and more than 9 percent.
“I wanted a house,” she said. “That was the best opportunity.”
The total monthly payments of about $3,400 were just barely affordable, she said, until one day she opened her bill and was stunned to learn that the larger loan was adjustable. Now her payments are more than $4,800 a month.
This winter they kept their gas heat off and made do with electric space heaters.
She came to yesterday’s workshop hoping to speak with her mortgage servicer, but the company was not there. She did speak with a counselor, though.
“I’m hoping I can get a mortgage I can pay,” she said. “I feel hopeful.”
The woman is in her 50’s!!!!!!!!! How does she expect to pay off the mortgage before she drops dead?!?
IMO this is one of the most interesting aspects of this bubble. In the area of Los Angeles that I live in, the first wave of foreclosures all seemed to be blue-collar people in their 40’s and 50’s who had obviously never owned a home before. Whenever you’d go to an open house you’d see the same telltale signs that the owners were blue-collar workers with teenage children. (Interestingly, the foreclosures currently hitting the market are a little different; they seem to mostly involve speculators and 30-something white collar workers who bought too much house. IMO the third wave will consist of Boomer serial HELOC-ers.)
I have never understood why so many people in their late 40’s -50’s became first time buyers during this bubble. I do feel a little sorry for the blue-collar workers. At least here in LA, prices have been so unaffordable for so long that people got desperate and saw the suicide loans as the only chance they’d ever have at the American Dream. These people still should be foreclosed upon, but I understand why they did it and do feel a little sorry for them.
Don’t people plan for the future? Don’t they realize that they will stop working, retire, and DIE someday? We might not like to think about these things, but you know, the probability that each of us will die one day is 100%; therefore I personally think it would be a good idea not to overlook death when making future plans.
Why are people in their 50’s buying houses? At what point do people just realize that they missed that boat? I am 36, 5′4″, and out of shape. As a result, I have given up on my dreams of a career in the NBA. Sure, it’s harder to give up on the dream of home ownership, but come on — if you are in your mid 50’s and are taking out a 30-year mortgage, you’ve got to ask yourself whether that makes sense.
A foreclosure in the making. They put nothing down, why should they be so attached to a 150% overpriced house?
I commented up thread that the best option for many borrowers is to help them through the foreclosure process, this couple is a poster child for that. Unfortunately, my guess is that they will take the course that will cause maximum financial damage by taking the advice of various do-gooders who try to help them “save their house”. The saving of this house will of course be at the expense of their long term financial health.
NY Times Mag today has an article (Roger Lowenstein) about government meddling with our financial system.
http://www.nytimes.com/2008/03/30/magazine/30wwln-lede-t.html?ex=1364443200&en=96818e112ef4019e&ei=5124&partner=permalink&exprod=permalink
And Lowenstein should know. He wrote that book “When Genius Failed”, about Meriwhether and Long Term Capital Mangement. However, I don’t want the FED meddling anymore in the US. FED really pissed the bed, IMHO.
The big question that everyone watching this unfolding drama should want answered: Can hair-of-the-dog hangover cures reflate the bubble from here, or have we passed the point of no return in the correction?
Hair of the dog -No,
too late - Yes
I have a question.
Milk is now $5-$6 a gallon. Food is through the roof. Gasoline approaches $4 a gallon while Diesel is already past that.
Does Bernanke keep cutting rates? Does commodity demand drop as people are forced to consume less due to higher prices? Do the speculators who bought oil and gold at these levels profit or do they get hammered when demand drops? That is, if it does.
I can get milk for a little over $4 a gallon here. Gasoline is close to $3.50 a gallon but could raise to near $4 this summer. As for food, thats why I want to grow an orchard, itll greatly cut down on the $ I need to spend buying food when it grows for free! Money doesn’t grow on trees but food does!
“Money doesn’t grow on trees but food does!”
Agricultural inputs are not exactly free, though.
Prices here are similar, Bye.
I’m gonna miss my chickens and their eggs when I leave this (rental) place. And the vegetable garden. DH could hunt across the street beyond this farm’s property if he ever got his license.
Hubby and I may have to have a gentleman’s farm in our future too.
I think the unwind has started with China. When Rogers was touting commodities, certain currencies, and Chinese equities I was with him on everything except Chinese equities, but now I think the rest may also be coming unraveled.
I think ag is actually more vulnerable than oil. It is a much freer market, and always reacts to higher prices with greater supply. OPEC actually has more power now than they’ve had in 30 years.
As for PMs, it does look like we may have seen an intermediate-term high. But every time I seriously consider the economic and political situation - and the prospects of rapidly-rising unemployment coming on top of the electioin cycle - I raise my mental probability of an inflationary end, and I really expect gold to be much higher (i.e., fiat currencies much weaker) a year or two from now.
BTW, was on the road this week, and am seeing a lot more hitchhikers - I travel a lot and there is just no doubt that there is a very sudden and significant increase. Made me kind of nostalgic for the good old 70s!
Another interesting thing I noticed was that more of the trucking seems to be running in older trucks of the notorious low-paying and bad-to-work-for outfits - Swift, Schneider, Werner. Looks like O/Os and high-cost operators may be getting squeezed.
Companies and certain professions (e.g., much of health care) which have traditionally used a premium-pricing strategy and who aren’t easily able to make radical changes in pricing are going to get killed.
Caputo’s (Elwood park, IL) this morning, a gallon of 1%, 2% or skim milk was $2.69.
Where are you living to pay over $5 a gallon?
I’ve sold a third of my gold and all of my oil, I’m seeing more and more stories about dropping oil demand, and decreased consumption, carpooling, driving less, buying smaller cars, stories about rail cars in storage, independent truckers closing up shop. I still don’t believe in a decoupled world economy. The US consumes 20-25% of world oil the last I checked. The US is one big domino in world consumption, I see it at 45 degrees and falling.
Paid $2.69 for a gallon of whole milk last night, but it was a weekly special, marked down from $3.79. Mostly I time my purchases to match the specials, which are regular events.
Read the handwriting on the wall.
FSA Admits Failings Over Northern Rock
27/03/2008
The Financial Services Authority (FSA) has come in for severe criticism after publishing a report into the way it monitored the Newcastle based bank Northern Rock.
The Silicon Valley housing data is finally out, from DQ. This is getting ugly, so no wonder they have started updating once every 5 weeks instead of every week. Perhaps not enough sales happen in a week to make it worth their while.
http://www.dqnews.com/Charts/Weekly-Charts/Mercury-News-Charts/ZIPSJMN08.aspx
Mr. Alan Blinder is opining in the NYT
How to Cast a Mortgage Lifeline?
“…The urgency of creating something like the HOLC or a Super F.H.A. has grown, not shrunk, since I wrote my previous column. Credit markets remain traumatized despite aggressive rate-cutting by the Federal Reserve. In dramatic actions just two weeks ago, the Fed arranged for the orderly burial of Bear Stearns and started lending money directly to securities firms. But even those bold steps calmed the waters only briefly.
Now we have the Frank-Dodd proposal, which, while not a panacea, offers a smart approach to a knotty set of problems — an approach that should breathe some life into the housing market, the mortgage market and the related securities markets. Their design is not flawless. But do you know of any perfect solutions? It deserves our support.”
http://tinyurl.com/3awzww
How about if someone from one of the big five economics programs (Princeton, MIT, Chicago, Stanford & Harvard) comes out with an editorial to the effect of “Why to Not Cast a Mortgage Lifeline”? I suggest the Chicago school, as they are the best at free market arguments. Researchers at Stanford’s Hoover Institution could probably come up with one as well.
Har de har har.
You’ve never actually spoken to a bunch of Chicago economists, have you?
You’d be surprised…
I can tell you who shorted AMZN at 100-ish, and po*ped their pants, and covered at 200.
For a 6% fee, of course!
“Conceptually, the answer is simple: Haircuts should reflect current market values, which are well below face values. But there is a problem: With the resale market for mortgages virtually shut down, there are hardly any market prices.”
IMO, this is a natural consequence of floating so many bailout proposals. Why would anyone want to sell at fire sale prices (even if they represent realistic market values) if the hope for bailout monies made it worth the speculative wait?
Saw two late night episodes of “flip this house” and “flip that house”. It wass funny because they were on at the same time on two different channels. Had to “flip” flop on the channels
They were recent ones (2008). One guy was flipping a house in LA, CA. bought it for $340K only put in $5K in enhanments. Basically he did nothing to the house. Yard was still a mess, he kept the same kitchen cabinets. He just repainted the damn thing. Realtor came in and gave him a number at $300K. He said he was going to rent it. The show said he was renting it for $1500 a month and mentioned it covers the Mortgage. I say that was BS! do the math.
The other show had these three investors buying a POS of a house in a bad area in Atlanta. They had a budget of $35,000 and basically had to rebuild the whole house from scratch. They said the budget went over $50K but I think that was BS too. Build a house from scratch costs more than $50K. They were hiring a bunch of shady contractors to finsih the job. I didn’t get to finish it but I already kind of new what was going to be the result at the end.
Funny stuff
ECONOMIC PREVIEW
Economic downturn worsens in March
Payrolls, ISM should show further weakness in the economy
By Rex Nutting, MarketWatch
Last update: 12:01 a.m. EDT March 30, 2008
WASHINGTON (MarketWatch) — Markets may be stabilizing, but the news on the economy is getting worse. The coming week will see more dismal headlines on employment, construction and manufacturing, economists said.
“The indicators on the economy will point in the direction of pronounced weakness in domestic demand,” wrote Global Insight economists Nigel Gault and Brian Bethune.
Ugh…… more talk on the television about mortgage bailouts. Makes me ill. I have worked FT since I was 16, sometimes 2 jobs. Raised a son alone after I threw the bum out, son now is a city planner with master’s degree. Saved like crazy to buy my first house and moved up over the years to a nice, small cozy house. Last vacation was maybe 7 years ago???? Buy markdowns, hand-me-downs etc. No spa days in my budget!
I have watched neighbors and other refi and go on trips to Disney, Mexico, etc. Saw bone-head woman on CNN whining about not getting food stamps because she can’t afford the interest-only mortgage on a piece of crap 1/2 million dollar house. Nice granite counter tops- why doesn’t she trying chewing on them?
I’m so angry about this mortgage mess that I’m ready, willing and able to march on Washington for the first time in almost 40 years. Last time I was 19, during Viet Nam war. Anyone want to join me? I truly have had enough!
I’ll show up if you can get the government to bail me outta here by giving me free money for gas.
You are not alone, Spucky!
And the moral of that story is: This is why I will not kayak where orcas are known to habitate or visit. Big, highly intelligent, ‘playful’ marine predators? Combined with a small pink meat tube floating in a plastic kayak? Fook! I’m practically a Slim Jim!
Ooops–was supposed to post higher, under a discussion with lostcontrol about ’sport’.
I read your message Olympiagal. I have learned something new! Maybe humans and other higher level intelligent animals have more in common than we thought! God, I hope they don’t pick up human bad habits like organized warfare!!!
lol
To all of your deflation promoters (PB) I want to bring your attention to an article on mises.org.
It points out that in the early stages of inflation price increases are much slower than the increase in the money supply because people expect that the money is still worth the same. In the middle phase of inflation prices rise with the money supply, but people always look at CPI as a “past event”. In the late phases of inflation prices rise much quicker than the money supply because people *expect* prices to continue to climb and they realize the money supply is much larger.
In other words, we have had a huge increase in the money supply over the past 5 years, but prices are just now starting to make up for that increase. This means that any decrease in the money supply (from defaults) comes out of unaccounted for increases in the money supply. Mean while more and more people are expecting inflation due to the Fed’s new policy. All of these factors combine to rule out deflation in the necessities of life.
The big question is what percentage of US oil consumption is a necessity. My guess 95% or more don’t need an SUV or V8, and 50% of trips are to buy crap that isn’t needed or to go on vacation. Walking, car pooling, riding bikes, and taking public transport could dramatically cut consumption. How much of the oil used in transporting goods goes for necessities. If inflation gets as bad as you suggest US oil consumption will plummet. Since there will not be any corresponding wage inflation for some time people are going to have to cut consumption.
I totally agree about US oil consumption not being a necessity. People were riding so high, there was a lot of fat to be cut. People can cut back on vacations and drive more fuel efficient cars too. I’m already noticing a lot fewer of what I could only assume were HELOC-mobiles on the road.
“To all of your deflation promoters (PB)…”
Leave me out from under the scope of your sweeping generalities.
unless you can lay out credible numbers, this will just be a hypothesis.
Tip to Bye,
I have a neighbor with an orchard, it is easier than owning one myself. Gleaning (groundfalls) is allowed and welcome.
that one didn’t nest like I expected!
Battle lines form around Paulson’s reforms
Tough sell on Wall Street, Main Street and Capitol Hill
By Jim Jelter, MarketWatch
Last update: 3:42 p.m. EDT March 30, 2008
…
“It’s going to take a long time to get this through. Entrenched interests will have to be assuaged or diffused. It’s like merging Exxon and Mobil or Chrysler and Daimler. There are going to be winners and losers,” Peter Morici, professor of international business at the University of Maryland, said in an interview.
“But the basic problem is that it doesn’t fix what’s wrong. This is regulatory reform as seen through the eyes of a banker. It really entails less regulation than more. It provides no constraints on banks or mortgage companies from bundling loans into arcane or complex securities,” he added.
Record surge in Food Stamps Nationwide..1 in 8 in Michigan Now on Food Stamps.
http://www.nytimes.com/2008/03/31/us/31foodstamps.html?hp
Payrolls May Have Slumped for Third Month: U.S. Economy Preview
By Bob Willis
March 30 (Bloomberg) — The U.S. lost jobs for a third month in March and manufacturing contracted at the fastest pace in five years, signs the economy continues to turn down, economists said before reports this week.
Payrolls probably shrank by 50,000, according to the median estimate of economists surveyed by Bloomberg News before the Labor Department’s April 4 report. The last time the economy lost jobs for at least three consecutive months coincided with the start of the Iraq War in 2003.
“The economy has slipped into a recession,” said Ethan Harris, chief U.S. economist at Lehman Brothers Holdings Inc. in New York. “We expect the labor market to weaken, with payrolls falling steadily through the middle of next year.”
Job losses, slumping confidence and the biggest plunge in housing in a generation all point to a slowdown in consumer spending that will weaken growth. Federal Reserve Chairman Ben S. Bernanke will testify before Congress this week after lowering interest rates and extending credit to non-banks in an attempt to calm financial markets.
The projected decrease in payrolls would follow a decline of 63,000 in February and a smaller drop in January. The jobless rate likely rose to 5 percent from 4.8 percent, the survey said.
From Bloomberg, posted this evening.
HUD Chief Is Expected
To Announce Resignation
By DAMIAN PALETTA and MICHAEL M. PHILLIPS
March 31, 2008
WASHINGTON — Housing and Urban Development Secretary Alphonso Jackson is expected to announce his resignation Monday, according to people familiar with the matter, a decision that will deal a blow to the Bush administration’s efforts to tackle the housing and mortgage mess.
The exact reasons for Mr. Jackson’s decision couldn’t be learned. The secretary has been beset recently by allegations of cronyism and favoritism. Earlier this month, two Democratic senators, Patty Murray of Washington and Christopher Dodd of Connecticut, sent a letter to President Bush urging him to request Mr. Jackson’s resignation, arguing that the distraction has made him ineffective.
Wall Street Journal, posted 3/31/08
Curiouser and curiouser…
http://online.wsj.com/article/SB120692786807175983.html?mod=googlenews_wsj
PPT goes global?
Bush and Brown in push to deal with crisis
By James Blitz and George Parker in London
Published: March 30 2008 22:01 | Last updated: March 30 2008 22:01
George W. Bush, US president, and Gordon Brown, UK prime minister, have agreed to step up co-operation over the crisis in financial markets. They are setting up a joint working group which will develop plans to monitor and regulate the banking system.
At the heart of the proposals, agreed on Wednesday by Hank Paulson, US Treasury secretary, and Alistair Darling, UK chancellor, is the creation of a body made up of senior Treasury and regulatory figures from London and Washington.
ASIA MARKETS
Banks, exporters drag Tokyo; Shanghai in decline
By V. Phani Kumar, MarketWatch
Last update: 12:36 a.m. EDT March 31, 2008
…
“Anecdotal evidence is that global funding woes remain severe (and) banks are still under pressure to replenish their capital amid further write-downs, restraining banks’ ability to lend,” wrote ABN Amro analysts in a note to clients.
PETER BRIMELOW
Indians buying up gold?
Commentary: Gold bugs think Fed, other central banks making it available
By Peter Brimelow, MarketWatch
Last update: 12:08 a.m. EDT March 31, 2008
NEW YORK (MarketWatch) — The gold bugs are coming out of their holes again.
Cartoon depiction of the Fed’s helicopter rescuing Wall Street