Bits Bucket And Craigslist Finds For April 17, 2008
Please post off-topic ideas, links and Craigslist finds here.
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Just to throw this out there, it now seems that hotel sales are experiencing an exceptionally down period over the past 3 weeks, more so than over the last quarter which is already bad.
Shopping Centers are feeling pain right now too. Even “slum centers” (not just area, but also tenant mix) are showing signs of stress.
For the layman, when you say “hotel sales”, does that mean people renting rooms or does that mean selling the entire hotel building?
Not mine to answer, but I imagine mathguy means room rentals. Sales of whole hotels can’t be sufficiently frequent to generate a smooth time series in which a 3-week change would be meaningful. And I am guessing the decline in room rentals is a direct result of recently spiking fuel prices — business travel is being replaced by phone calls. (?)
I’m sure that retail sales are mostly down because of a general financial pinch, but, at least in the northeast, the weather really has been cold enough to put a damper on spring clothing sales. Damp blustery weather in the 50’s is does not inspire a desire for pale summery women’s clothing. I think it is finally shifting, but the past few weeks have felt more like November than spring about 80% of the time.
Since we make fun of the real estate people when they blame both good and bad weather alike for poor sales, I think it is appropriate to conceed when some sort of retailers have a point.
Polly,
With inflation of gas prices being reflected in the retail sales index, it actually shows more weakness than the index reflects. Needs are winning out over wants. School lunches for one, is costing the average family more, gas, utilites,, medical, and a host of other inflationary needs. Clothing can be put off. Although I agree with you some, its a pattern that will cause many retails to go BK. JC Penny, and a host of others are scaling back. Linens N Things, Talbots and others are in trouble from what I’ve read. Even grocery stores are reporting different buying patterns. The crunch is on.
I think we’ve got your spring weather up north Polly. In the 70s today in Syracuse. It’s been in the 60s and beautiful all week. The cherry blossom tree in front of my new rental home is just starting to bloom. Flowers in the sunny part of yards have been up for over a week.
TJ Maxx has been packed. They have upgraded their women’s clothing significantly (no doubt taking advantage of the distress of high-end boutiques). I’ve noticed some of the greatest deals on designer clothes and shoes (Mark Jacobs, Bottego Veneta, Donald J. Pliner) that I have ever seen anywhere.
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2 weeks ago, I booked a 3-night stay in a NYC hotel… right in the middle of Times Square…. on Travelocity, for $199/night.
I thought this rate was a bargain.. considering… after all.. it is TIMES SQUARE. I even checked the rate on the hotel’s own website… & they too were offering the same $199/night rate.
Last week.. I checked back on the hotel’s website.. & they LOWERED the rate to $179(weekday) & $189(weekend). So, I cancelled my Travelocity reservation & re-booked w/ the hotel.. saving some coin.
Point is… why would they LOWER rates? I thought all the Europeans were FLOODING OVER HERE IN DROVES due to the currency exchange rate?
Something doesn’t smell right…..
Last year when I went to NYC, it was $300 to $400 plus for a room in Mahattan.
Last year, spring break, $229 at the Waldorf.
Hotels & airlines are similar financial vehicles…
Their model is based upon beds & seats being filled to a certain capacity, and it isn’t happening~
Not to mention the absurd overhang of the extra capacity they built in when HELOC’s were ruling the world.
OverhangNails
I’ve been reading all over the Net that Europeans are eschewing travel here for a variety of reasons. Really interesting stuff — check it out. Like the arrest, incarceration, strip searches and harassment the woman from Iceland got for having an expired visa. That was in the news for a while. Nasty business, and she was just over here to shop in New York City. This kinda stuff is not good for tourism, needless to say.
We came back from NZ through L.A., and one thing that struck me about U.S. Customs was about 1/2 of the officials were wearing latex gloves, which means they did it of their own accord.
Foreigners must give all 10 fingerprints and get their photo taken, upon arrival (Joe Friday would be so proud)
Not very welcoming, as your first impression of America.
In Canada we just got direct flights at the start of this year from Vancouver to Sydney that don’t stop through Hawaii any longer. I know one of the flight attendants who does this leg regularly and there was a huge demand from travellers not to go through the US since your customs is such a pain these days. The flights have been 100% sold out since day 1 so has been proving extremely successful.
definitely, and for EU citizens the harassment already starts way before you start the trip (like the airline, acting for US Homeland Security, asking for lots of very detailed, and sometimes quite personal info). I’m not even thinking about visiting the US as long as they have these idiot ’security’ measures. A friend of mine got send back when he arrived in NYC (after being detained for about 3 hours) because he was considered a security risk. No explanation at all, just refused; I guess they made a mistake but of course they will never admit. What a great country.
Not that I don’t understand their annoyance and discomfort with our customs hassles, but I’ve alweays found it odd that when I travel in Italy with German friends they are not equally uncomfortable with the fact that the Italian hotel is required to report your residence to the police…
Brand new hotel Rancho Mirage, Agua Caliente Casino just opened new expansion and the rooms look gorgeous (on the news). The rate is $89 per night for the grand opening.
2-3 yrs ago, I would guess they would have asked double at least.
Last week we stayed at the Intercontinental in Montreal, a 4-star, $199-a-night hotel, for $83 a night! Thanks to AZ Lender, for the advice- I got it through Priceline.
2 weeks ago, I booked a 3-night stay in a NYC hotel… right in the middle of Times Square…. on Travelocity, for $199/night.
I thought this rate was a bargain.. considering… after all.. it is TIMES SQUARE. I even checked the rate on the hotel’s own website… & they too were offering the same $199/night rate.
Last week.. I checked back on the hotel’s website.. & they LOWERED the rate to $179(weekday) & $189(weekend). So, I cancelled my Travelocity reservation & re-booked w/ the hotel.. saving some coin.
Point is… why would they LOWER rates? I thought all the Europeans were FLOODING OVER HERE IN DROVES due to the currency exchange rate?
Something doesn’t smell right…..
Last time I was in Time’s square, that was an hourly rate.
You got off cheaper than Spitzer.
Nice pun!
Mr Spitzer, is that you?
cr@p… great minds think alike
How about the news from Harley-Davidson?
In addition to reduced guidance, production cuts and layoffs, there is this:
“Dealers have reported that the company’s finance arm, in an effort to tighten up credit standards and ease concerns on Wall Street, has lowered the amount of money it will lend buyers to just 100 percent of the cost of a new bike.”
Now we *know* we’re in a recession.
Great, even HD was offering zero down cash back at closing? Things were even worse than I thought…
BTW, still seeing grossly overpriced used cars and motorcycles for sale. Methinks they’ll stay that way until the repo man comes to get them.
Agreed……..I have been looking for a newer used car for my daughter, but used car prices seem to be just as sticky as used house prices.
I still scratch my head when I see a 3-4 year old car or truck with 80-90K miles on it, with an asking price that is half what you can buy a NEW one for.
That, and calling any old crock over 20 years old a “Classic”…….sorry to tell you guys this, but nobody lusted after a 4-door, six cylinder, three on the tree Chevelle THEN, and they sure as hell aren’t doing so now (unless they need a parts car for their SS396)
I’ve been looking for a late model SUV and have to agree, prices are up there. I keep reading about all these people desperate for money. I keep seeing stories in the MSM about repos being up 10-15% over last year. Not translating into lower prices for me.
the bike/car loanowners have financing costs on these toys same as the house and the mortgage. Prices can only go so low-repo man-for toys/ sheriff for house are a coming. My prediction -in the not to far future liar loan liars will be “forced” to stay in their homes and pay the nut or will face prosecution for fraud
RE: How about the news from Harley-Davidson?
Visited my local “Taj Mahal” stealership” last Saturday.
The salesroom floor was jammed with inventory and manned by some very glum looking salesmen.
2 years ago these chucks had machines marked up $5k over MSRP and couldn’t move them out the door fast enough.
Interesting how their fortunes paralleled the rise in HELOC borrowing. But then the whole HD thing has been demographically driven by mid-life crisis boomers.
Average age of HD purchaser now @ 48.
Truly the end of an era.
Vegas is slow for this time of year, too. WSJ reports deals are happening that are usually reserved for the slow summer months.
Las Vegas Casinos Roll Out the Deals:
http://online.wsj.com/article/SB120839324112621477.html?mod=2_1367_topbox
“Springtime is boomtime in Las Vegas — with pool-perfect weather drawing business travelers, gamblers, golfers and spa-goers eager to put winter behind them. The only catch: $500-a-night rooms; $300 meals; $200 show tickets.
Not this spring.
Reacting to a national economic slump that has depressed gambling revenues and room rates along the tourist zone known as the Las Vegas Strip, casino and hotel operators are offering up a buffet of spring time deals normally reserved for the hot, slow summer months.
Both the Luxor (above) and the New York, New York (right) hotels are offering special packages.
Already, room rates along the Strip are predicted to decline 23% through May 3, according to one analyst. Gambling revenues recently dropped for the second straight month, and visitation is down slightly. Conventioneers — those lanyard-wearing herds responsible for driving up midweek hotel-room prices — are cutting their stays short. Leisure travelers aren’t coming in their usual peak spring numbers.”
Pavlovegas requires constant reinforcement…
ahem. Tried to make reservations this weekend in Las Vegas or Laughlin. All those 48 yr old HD owners have taken over the state and there’s not a room to be had. Oh well, there’s always the summer super-hot slow time coming.
Big Questions…
http://www.chicagotribune.com/business/chi-thu-fed-collateral-0417-apr17,0,3122928.story
Anybody have any opinions on the Colorado market? It’s strange around here. We didn’t have the massive appreciation that some parts of the country experienced but we have lots and lots of foreclosures. Prices in my town are down to about 3x median family income so that seems like a good sign, but we have lots of foreclosures still coming.
Many properties can be picked up that will cash flow (rents are good - probably all the people that have lost their houses). I’m starting to think about buying but I can’t help but think I’m missing a piece of the puzzle around here. It just doesn’t make a whole lot of sense.
Foreclosures without prior price appreciation are evidence of a “stealth bubble”. If prices had stayed in step with incomes they would have declined.
Same thing as is happening in Detroit and other places in the Midwest.
“We didn’t have the massive appreciation that some parts of the country experienced”
I don’t buy that one at all. I frequently hear this same statement from people in areas that saw prices up 50%-200%. To me it’s just a different slant on the denial and hanging onto year 2005. Let go or be dragged I say to them.
If memory serves me right, I recall CO literally on fire in the mid-90’s, housing and jobs alike. Didn’t the economy begin to come apart there post NASDAQ bubble? Anyways, there may be something to support your assertion but by virtue of the fact you say foreclosures are everywhere, I tend to suspect there is loads of koolade induced denial……… just like every other geographical location.
“I frequently hear this same statement from people in areas that saw prices up 50%-200%. To me it’s just a different slant on the denial and hanging onto year 2005.”
So, you’ve been to Minnesota?
NYC… it’s funny watching the asymmetrical decline in all these areas. Remember the piddly-assed 1% price reductions in Cal and FL early last year? The same stuff is happening in the northeast right now.
The West Denial virus has spread to the East. The Foreclosure Fever can’t be far behind.
Hey Exeter, What are you seeing in your hood? I’m in the Conway/Jackson/Bartlett area of New Hampshire and I can tell you that land prices are not declining. I don’t see a lot being sold but I have seen some go pending. Also, I have noted that a few small commercial buildings around here have gone pending recently.
I think this area is primed for a big fall though. A couple of strip malls are being completed but I hear whispers here and there about weakness in the small businesses around town.
I see some used homes with reduced prices and I also noted a couple of listings that are short sales and bank owned types.
No price reductions on any of the land that I’ve been tracking for about 8 months. Some of these parcels have been listed over a year now with NO price reductions. Crazy. How much longer can these folks pretend that they are selling their land/homes by setting a wishing price that has no chance of being realized?
I low-balled a few parcels the past few weeks and didn’t even get a counter-offer. It was nice to insult some sellers though. I don’t think the sellers around here have felt pressure yet.
“The West Denial virus has spread to the East.”
LOL.
RE: Conway/Jackson/Bartlett area of New Hampshire and I can tell you that land prices are not declining.
Save for Stowe VT your area is the creme de la creme for New England inland non-coastal retirement/2nd homes.
Even if gaz prices go crazy, the tourists will still come to support the service economy via rail from Boston to Portland and then to North Conway from a new trunk line.
The situation with land pricing hanging tough,is a lot of the area is federal owned, plus legions of retiring Mazzholes will continue to put pressure on availability and prices.
Personally, if you see something that really grabs you-I’d get an appraisal-dicker as hard as I could-and then make a reasonable offer.
Don’t underestimate the incredible hordes of people who are south of you and totally sick of their congested,me-first/get outta my way lifestyles.
The real travesty is when they bring it all with them when they come north.
Good work on the insulting offers Auger. Sends a loud message without having to scream. I haven’t checked prices in and around NY/VT border areas but I can confirm ALOT more parcels are for sale right now. Alot more. Most folks I know who hold large parcels know the party is over and some of them are trying to unload. I’ll say you cannot go wrong offering pennies on the dollar for bulk land. Many times it works. I’ve seen it happen before but I think we’re way too far early in the cycle for that to work.
“The real travesty is when they bring it all with them when they come north.”
BINGO…..You have a way with words brother.
My Grnadfather came from Swanton Vermont in the 1900’s, he said after a visit 60 some years later “nothing’s changed, same crappy place” I’ve never been but it can’t be too touristy or bubbly in that area
What’s with the reverse typing???
While I’m on the west coast (PNW), I’m not seeing any reductions in raw land prices around here either. I’ve even looked into the Tahoe area where house prices are getting throttled and land seems to be resting on a permanently high plateau, with small acreage still selling for absurd amounts. I don’t get it.
I spent my early childhood in Swanton, VT. My dad’s boss and other area leaders advised him to get out of Dodge because the area was going to be hit hard before the early 70s recession. We moved to the seacoast area in NH where he did well with his own business.
I do remember Swanton as being a good place for an idyllic early childhood especially since things were kind of nutty elsewhere. (VietNam protests, Kent State, desegregation issues, president and other assasinations) Being w/in an hour of Boston and a 15 min bike ride to the ocean suited the later education oriented later years. Suited me well for job opps in the early 80s recession too.
I’d actually like to visit sometimes! I’m into genealogy so I think it would be fun. Plenty of my family still there according to the Swanton folk I met at the VFW National Convention in 2004.
>
Literally? Are you sure about that? : )
No market is immune to the collapse because it has the overall effect of halting migration. You may not have had a huge bubble but the people who would otherwise move to your town can’t sell there home elsewhere. It’s like turning off the faucet to new money.
True, but folks migrating for a better job or a better place will find places to rent, which helps create a bottom through shoring up rent rates. If their old home is foreclosed on months after they become a tennant in their new town, the landlord woild not have know they were in trouble when checking credit.
I lived in Colorado from ‘93-’02. The bubble in Colorado wasn’t a sharp bubble like here in PHX. It was a long-slow bubble going back to ‘91 or so.
In ‘93 I bought a house for $98K that would have been $78K in ‘91. By the time I lost it to the ex. in ‘02 it was up to $140K.
Tech boom created lots of better paying jobs, and that pushed up property values. Then came the tech bust and many, many of those jobs went away…. to be replaced by easy credit. So, prices did not fall back to pre-tech bubble levels.
In fact, they kept going up at a rate higher than wages. From ‘02 to ‘06 that $140K house went to $200K. It has now slipped to about $190K.
So, yeah, prices didn’t double from ‘01 to ‘06 as they did in some places. But they did double from ‘93 to ‘06. Wages most certainly have NOT doubled in that time.
Cashflow positive? Are you accounting for repairs and maintenance, periods of vacancy, oppertunity costs of money you will use as a down?
Remember why there is a rule of thumb that price should be 100 x 1-month rent. That 100 assumes an 8% interest rate. At 6%-ish, you can probably go to 120. So, if a house can rent for $1000 a month, it should be $120K or so. If it can rent for $1300 it should be $150-160K.
Yes housing prices ran up in the 90s. Prices are back to their 2000 levels in many parts of the area. I’ve run several neighborhoods of interest through the assessor’s for past sales info so I know this is true.
(Prices are still out of whack is some places, e.g. Boulder.)
Median family income is $65K as of 2006 so 3x = $195K. You can get (if you shop a bit) a 3/2/2 house for $180K that will rent for $1400 in a good neighborhood. This meets your rule of thumb but rules of thumb aside, I’ve run the numbers in detail including vacancy, PITI, 1/3/5 yr maint reserves, etc. and the example property I used above will return about 6.5% cash-on-cash with 25% down 30 yr fixed. This isn’t great but it’s not horrible either.
BTW, I sold a house here in ‘94 for $107K. That house would now sell for about $140K-$150K so my experience jibes with yours.
DB, you don’t say what part of the state you are in. I bought in Fort Collins in 2000 at $216k and sold in Nov. 2007 at $277k. Appreciation was strong for a couple of years, then really slowed down. I still track the No. Colo. market each month. Sales are continuing down Y-O-Y-O-Y, even in Boulder, but prices are a little sticky.
Inventory is the real issue now, there was a 3 month supply in 2000 and now there’s at least a 10-12 month supply in most places (up to 3 year supply of higher end homes).
I don’t buy your theory of renting out a $180k house for $1,400 a month - I don’t think the market will support that - just too many options for renters. I know of a few landlords who are holding rents steady just to keep their rentals full.
I live in the Boulder area and have been looking at North Denver Metro up through Longmont / Firestone and not really anything north of that. I really haven’t done any research on Loveland / Ft. Collins so what you’ve said is good to know.
The $180K for $1400 example would be a house that would have sold for $230K in 2005 and is now a REO listed at $189K in an 8 yr old neighborhood with good schools, location, etc.
I think the high rents are probably due to the large number of foreclosures in the area that have pushed people out of their homes but not out of the area combined with a shortage of rentals as these homes haven’t made it back onto the market yet.
In other words, it’s probably temporary (maybe a 1-2 year phenomenon). That’s kind of what I’m trying to sort out so I can make some decent decisions. I think I understand the property value market and trends around here pretty well though I don’t really know how far we’re going to overshoot the historical trendline on the way down - nobody really does. I don’t have a good handle on the whys and wherefores of the rental market yet, however, and as an investor looking solely at NOI, that’s half the puzzle.
BTW, it’s really nice have so many intelligent, skeptical folks to sound off of. Thanks to everyone for their comments.
RE: By the time I lost it to the ex. in ‘02 it was up to $140K.
Lot’s of that going around…just when you think you’re just about there to coast for awhile…BAM! Right between the eyes….I’M UNHAPPY!
“about there to coast for awhile..”
All of us are guilty of that to one degree or another, and then the other finds it boring. And Pfffft. Hurry, shake it up make it exciting. learn to dance. Something to rekindle the romance. Then maybe in the long run the combined effort will save the family “fortunes”.
Even if there wasn’t “massive” appreciation, appreciation occurred that otherwise probably wouldn’t have without all these toxic loans. And appreciation or not, these toxic loans were as available in the Midwest as they were on the coasts, allowing plenty of people to get in to houses they probably shouldn’t have if they were required to have silly little things like 10% down.
Also, be sure you’re aware of which way rents are going. The rents go up when housing goes down theory sounds good on paper, but in reality, not so much. Here (SE Michigan) you currently have massive inventory AND dropping rents.
Actually, I think rents will go up in the short term (actually they *have* gone up so it’s not really a prediction) because the people who lost their homes and were paying $1400-$1500 / month mortgages (which then reset to $1900-$2000) still have jobs and still need a place to live AND the houses which they lost haven’t really made it back onto the market yet. The lenders are being incredibly difficult / stubborn re: short sales and even REOs. There’s still plenty of denial around here too!
yeah, a high churn rate, either on the way up or down will tend to temporarily remove housing from the market, thereby raising rents.
Here’s a rental in the same price range you are talking about . . . there is no way in h@#% you could buy it for $180k - more like $300k.
http://denver.craigslist.org/apa/645503697.html
Here’s another one DB. A rental with long-term tenant that is subject to short sale. WTF? Don’t know if the landlord is a total idiot or if it just doesn’t pencil out. Doesn’t say what the rent rate is, but in Longmont for a $165k home, I would guess the rents are less than $1k per month.
http://denver.craigslist.org/rfs/645557474.html
Yes… Odd. A quick check shows a quit claim in 2005 as the last property transfer.
I have a prop sheet for another one here on my desk. $185K with $1500/mo tenant. As a short sale. And a strong smell of tuna.
My opinion on Colorado is the same for the entire U.S. It couldn’t possibly hurt you to wait a little longer.
Even if your area didn’t have the massive price appreciation, people were still offered funky, “creative financing”. I bet you still had many buying more house than they could afford. And I bet even Colorado had their share of the Aspirational wealthy!
“I’m missing a piece of the puzzle around here”
Simple: Mortgage brokers, no license required, ex-cons welcome = fraud, fraud and more fraud.
My observation in Colorado (at least in Larimer County) is that a lot of very low income people used no down subprime loans to buy entry level houses (150K or so). Now that the loans are resetting these people are losing their homes. It is also my understanding that the foreclosure rate in Larimer Co is much lower than the statewide average and especially lower than in Denver and especially Greeley (still higher than it ought to be).
Another observation is that there are no buyers for houses above 300K, which is not suprising with the lack of quality jobs. Since the tech bust of 2000 the region has bled good paying jobs. Those who already lived in Larimer County are hanging on by getting a job in Denver, but no one is going to buy a McMansion out here if they already work in Denver. If they want a cheaper house, they will buy somewhere further south, like Erie or Frederick. From what I have seen residential construction in Larimer County has pretty much ground to a halt. National builders like Lennar and Centex have closed shop and left, and only the mom and pop builders are still here, and they aren’t building spec homes either. I have heard plenty of stories through the grapevine of subcontractors who can’t find any work, and what little they do find they actually do themselves.
What I am also hearing through the grapevine is that the lower priced houses are not dropping a lot in price, while the higher end ones are, which kind of makes sense. For instance, 180K houses have dropped to 170K, while 400K houses have dropped to 300K. There are some new jobs out here that can support 150-200K houses, but not 300K+ houses.
Would I buy investment property in Larimer Co? I would not, as I don’t expect to see any appreciation out here for a very, very long time. While its true that median HH income is above the national average in Larimer County, there just isn’t a whole lot of job creation, and without that there can’t be a whole lot of demand, especially at the upper end. The local media get all excited when a factory with $15/hr jobs opens. Those people can’t afford a house. The region needs a lot more jobs at places like HP and Intel, but it isn’t going to happen. Will prices continue to drop? I suppose that it depends on how many people find themselves in a situation where they “have to sell”. If the remaining quality employers close shop then I definitely see a collapse across the board.
Who would have ever guessed that “Red Dawn” would descend upon Colorado, in such a financial fashion?
Would? The bottom fell out of the front range 8 years ago. We still haven’t recovered. A good barometer of this is that there have been no TABOR refunds since then, an indicator that state tax revenue growth has not exceeded inflation and population growth.
Wolverines!
In El Paso County, despite the local newspaper being a propanda outlet of the local NARsters, the realization is dawning that we’re NOT different here. Foreclosures are hitting record levels and not much is selling, though the greedhead quotient here is still very high - sellers are stubbornly asking 2005 prices, and their houses are just sitting unsold month after month. The realtors and local “economists” (paid NAR shills) are keeping up the “it’s different here” mantra, and claiming a planned influx of thousands of US Army troops (among the least creditworthy population on the planet) and their dependents will prop up housing values. Meanwhile, thousands of unsold crapboxes by the likes of Lennar and Pulte are being deeply discounted but still aren’t selling.
Well here in southwest colorado, prices are triple what they were in the late 90s. i think the median price in durango is something like $450k. in my town, not one house was for sale in 2003 for over $199k. today, the only thing for sale at $199k is an older ~750sqft condo with mold and on the very edge of town. we’ve got a ways to go, though i imagine the front range is a different story.
I still find it amazing that the dirt poor SW part of the state had so much appreciation, and median prices are higher there than in much more prosperous Larimer Co. Sure, Durango is pretty, but it appears that even ugly Cortez had massive appreciation. Must be all that Navajo Fry bread they sell that props up the economy.
No kidding about Cortez. We rambled through there about a year ago and it was pretty depressing BEFORE we got around to the real estate pricing.
I still track Durango land prices and up towards the ski area. Those friggin prices are ridiculous, period. How many folks are going to spend a million dollars for 30 acres of land upon which to build a Mcmansion? there are probably 30-40 listings like this. That place needs to die and be reborn, this time with a clue. We stopped harboring serious thoughts of settling there about 10 minutes after logging on to the local Realtor search engine.
$1m for 30 acres? That’s not too bad. I’m seeing 3 acre view parcels selling for that here in the Puget Sound area.
Merrill posts 3 straight lost.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a4rEEQbdSmSA&refer=home
Yep, Lots of continuing good news, the markets should zoom upwards!
The headlines read:
Merrill Falls Short, to Slash Jobs- AP
Weekly Jobless Claims Rise More Than Expected- AP Stocks Fall Following Earnings Reports- AP
Pfizer 1Q Profit Falls Short of Estimates- AP
Harley-Davidson Cuts Outlook, to Slash Output- Reuters
Nokia’s 1Q Profit Misses Estimates- AP
Oil Hits Record High as Dollar Tumbles to New Low- AP
http://finance.yahoo.com/
And guess what? The market moves higher. Buy the bad news, sell the good news? Must be that the trend is your friend and that’s all that matters.
You can hear the bankers tightening credit. Guy is rewriting and review risk standards.
I’m still confused as to how all this deflation will go. I wonder if anyone has a good link to M3 and M0 numbers.
All is not well in the banking world and it’s getting worse - Banks are desperate for cash globally
http://www.bloomberg.com/apps/news?pid=20601087&sid=aEoqz5RYfsz0&refer=home
This is a continuation of the LIBOR posting yesterday (Dr Bear) -
http://www.bloomberg.com/apps/news?pid=20601068&sid=auHuzk67W6Mg&refer=home
Regardless of the Bear bounce going on on the street, the credit situation is obviously getting worse for anyone who cares to look.
Show me the money! Where’s my 7% APY?
Seriously! I’ve got some CD’s @ 5.2 % maturing in August and I don’t have the faintest clue where I’m going to get that kind of return at the moment. Maybe I’ll park it in GE Capital.
If you believe the US is going to pull out of this insolvency crisis this year, then buy some corporate bond funds. Many are yielding 8%+. If you believe the crisis is not going to get better, buy a Global treasury funds, avg yield 5%.
“Where’s my 7% APY?”
There’s the sad part. If the banking industry were not rife with regulatory manipulation, I am sure there would be a simple way to supply liquidity to cash-strapped banks. The money market would be flush with cash if they offered 7 pct returns (or whatever rate the money markets would actually bear w/o the policy distortion of below-market rates offered by the Fed). One would think the Fed could figure out the Econ 101 connection between offering banks below-market rates (i.e., an interest rate below the market equilibrium) and a liquidity shortage (market supply falling short of demand at a below-equilibrium interest rate).
Water, water, every where,
And all the boards did shrink;
Water, water, every where,
Nor any drop to drink.
RE: Seriously! I’ve got some CD’s @ 5.2 % maturing in August and I don’t have the faintest clue where I’m going to get that kind of return at the moment. Maybe I’ll park it in GE Capital.
My 85YO mother just faced the same cirucumstances.
Of course with her Depression era comfort levels she wants nothing exotic.
So the rollovers went to 2%.
She was quite glum.
With inflation @ 8/10%, the war on savers continues.
With no let-up in sight… Total war, scorched earth, and nothings but ruins in the end…
Same boat here. Recently had some 5.25% CDs expire and the best I can do is 3% in a money market. Still a better investment than buying a house, though, for which the money will eventually be used.
Hoz, what are some ways into those global treasury funds? Is there an easy way via mutual fund or ETF?
Global treasury funds — in the event of a worldwide credit collapse, or other systemic failure, what would likely happen to their value & yields?
Lie-bor?
The culture of deception is global.
Merrill announces 4k job cuts today, in addition to the 1k last month. UBS announced a 15% cut in banking jobs, Goldman is taking down 10%, Morgan Stanley has had rolling layoffs, Bear employees are down 7k from Tuesday…but where is the NYTimes story totaling the job losses??
NYC derives 40% of its tax revenues from financial services, and the mounting job losses are a way to track the future of the economy here…but this story is not getting coverage.
The total losses are being kept under the radar. The news is being managed and controlled in a striking way.
I use this website to track some layoffs. It is probability not all inclusive. Thesesa are the listings for April.
http://www.shaker.com/industry_news/layoffs_hirings
04-10-2008 — Regal Beloit Corporation - Layoff
04-10-2008 — Group Health Cooperative - Layoff
04-10-2008 — Philadelphia Media Holdings LLC - Layoff
04-10-2008 — Q3 Stamped Metal Inc. - Layoff
04-10-2008 — Teletech Holdings Inc. - Layoff
04-10-2008 — Dura Automotive Systems Inc. - Layoff
04-10-2008 — Wells Fargo & Company - Layoff
04-10-2008 — Vista Unified School District - Layoff
04-10-2008 — Carlsbad School District - Layoff
04-10-2008 — National - Layoff
04-03-2008 — Matsuskita Electric Industrial Co., Ltd. - Layoff
04-03-2008 — Johnson Rubber Company, Inc. - Layoff
04-03-2008 — New York City Off-Track Betting Corporation - Layoff
04-03-2008 — Condell Medical Center - Layoff
04-03-2008 — Adventist Health System - Layoff
04-03-2008 — Preferred Home Mortgage Company - Layoff
04-03-2008 — Chico Unified School District - Layoff
04-03-2008 — National - Layoff
NYC derives 40% of its tax revenues from financial services, and the mounting job losses are a way to track the future of the economy here…but this story is not getting coverage. The total losses are being kept under the radar. The news is being managed and controlled in a striking way.
Very interesting insight, Spike 66. I don’t doubt that the NYT wants to minimize the bad news for its Wall Street Sugar Daddies.
“Merrill announces 4k job cuts today”
Old Merrill’s Marauders: http://en.wikipedia.org/wiki/Merrill’s_Marauders
New Merrill’s Marauders:
The unemployed
RE: Merrill’s Marauders:
Now there’s a blast from the past.
Wonder how many people today can place these guys in history…
Not too bright for the global food situation either
http://www.bloomberg.com/apps/news?pid=20601087&sid=a.c6ORUiuqng&refer=home
And it’s getting worse:
A Drought in Australia, a Global Shortage of Rice
http://tinyurl.com/4re5ug
The collapse of Australia’s rice production is one of several factors contributing to a doubling of rice prices in the last three months — increases that have led the world’s largest exporters to restrict exports severely, spurred panicked hoarding in Hong Kong and the Philippines, and set off violent protests in countries including Cameroon, Egypt, Ethiopia, Haiti, Indonesia, Italy, Ivory Coast, Mauritania, the Philippines, Thailand, Uzbekistan and Yemen.
Italy?
No kidding - the price of Pasta is skyrocketing and the Italians (especially in the South) are among the poorest of Western Europeans.
There was an issue with tainted cheese that was imported from China…evidently, they take their cheese seriously in Italy!
As well they should. Good cheese, as we all know, is one of the most important things in life.
Amen, sister. Along with wild mushrooms.
HIGH FIVE!!!
With extremism of all stripes running rampant so far this century, the last thing some of these places need is widespread hunger. Talk about stirring the pot!
‘Talk about stirring the pot!’
I like to put ourselves in the position of our country’s ancestors, the Anasazi…
They were sprawling homebuilders, (permanent, not temporary)
that built 5 story free-standing structures (Chaco Canyon in N.M. is amazing, America’s Pompeii) and cliff dwellings by the score, all across the southwest. (including some just a few miles from where Ben lives)
They lasted about 300 years, in their prime-time of activity, and then a series of wicked droughts, invasions of marauding tribes from the south, and finally perhaps vis a vis climate change, (little ice age) the ability to grow food was curtailed, which led them towards cannibalism, as Professor Christy Turner wrote about in “Man Corn”.
One of the most compelling bits of evidence were many human bones that had ‘pot marks’ on them, indicating they’d been cooked in a pot…
http://www.amazon.com/Man-Corn-Cannibalism-Prehistoric-Southwest/dp/087480566X
One of the most compelling bits of evidence were many human bones that had ‘pot marks’ on them, indicating they’d been cooked in a pot…
This is not evidence that the “Anasazi” indulged in cannibalism. Give me a break.
That’s just one of many bits of compelling evidence…
I recommend reading Professor Turner’s book to learn more~
I read his crap. The evidence is not compelling. One of the investigations also found human feces in the floors of the living quarters, which is not evidence that the “Anasazi” s**t where they ate. Now if Professor Turner linked the dirty deeds to maruaduing Aztecs (or whatever the era’s mesoamericans were called), to the Vikings or the Franks of that era, I might believe it.
the book “Collapse” suggests the same thing
Knife marks on human bones exactly like those found on antelope bones as well as long bones cracked in such a way that the marrow can be extracted. Hmmmm. Sure sounds like a good old fashoned ‘long pig barbeque’ to me
As an archaeologist in the SW, I have to sadly tell you that what the Lad says is true. The evidence is conclusive.
Anthropologist in Texas concurs. I don’t know why people have such strong reactions to what people naturally do in desperate times. The Chinese did the same thing in the last century thanks to Mao’s great leap forward.
‘I recommend reading Professor Turner’s book to learn more~’
Any relation to Ted?
I recently watched a documentary called “Life and Debt” which talks about the economics of Jamaica. It is a very interesting look at how the Jamaican agricultural business has been destroyed, and now they are reliant on cheap imported food from the US. There is one scene in particular, where the local dairy farmer is dumping his milk onto the ground because he can’t compete with imported powder milk prices, nor can the locals afford his product anymore. The end effect, the local farmers have been devastated and they are no longer able to produce. With globalization, I always thought the poorer countries would enjoy a rise in their standard of living, but it really this is just a race to the bottom.
I certainly recommend this one, I feel I have a much better understanding of how this food crisis will be felt around the world.
Home construction takes a dive in area, nationwide
Local slump is less severe than in other parts of the country
http://tinyurl.com/68bfea
The number of building permits issued for new houses, duplexes and apartment complexes in 2007 in the Rochester region was barely half of what it was in 2006 — 1,185 last year versus 2,288 the year before, according to preliminary census figures.
“The silver lining is, we’re not seeing as sharp a decline as the U.S. is seeing,” M&T Bank regional economist Gary Keith said Wednesday
First-quarter housing starts from towns in the region are not yet available, but “from what I’ve been hearing, the home-building industry in Rochester is alive and well,” said Rick Herman, executive vice president of the Rochester Homebuilders Association.
The local rag quotes an economist and a homebuilders association rep, which are both dubious characters in this production. The good news is that home construction is off 50% and we don’t have any facts, but home construction sounds alive and well! Buy now or forever lose that chance to get a home in upstate NY! Why would anyone quote or listen to this type of “expert?”
The denial is thick in upstate. I tore a Times Union reporter a new ass on his article that quoted the local axis of RE voodoo priests(builders, regional RE sales organizations and lenders). I can appreciate the folks there are hoping for a future, anything so long as they don’t have to resume the long downward economic decline but lying to the public and won’t stop that decline. I’ve had extended family there and when the topic comes up, I tell them “we will never see 2005 housing prices again in our lifetime, adjusted for inflation.” Dead silence.
Just wait until AMD announces they are not going to build the new chip plant - soon before or just after Senator Bruno gets indicted
This is the plant I saw in the news as adding about 1400 jobs and receiving $1.2B in state subsidies. Without using an AMD processor, that calculates out to $80 million per job. ????
Beam me up Scotty, there’s no intelligent life on this planet!
Should have used an AMD.
My Casio now says $857,000 per job.
This really is such a much better deal!
$857K per job over 25 years should pay for itself in taxes generated. Plus add in the indirect benefits (worker at AMD buys new car, employs car salesman who then goes out to dinner, employes waiter, etc).
AMD is unlikely to be there for 25 years. There is no obligation on their part to stay in the area.
realestateskeptic… I don’t recall ever seeing you post here but you’re exactly right because I know for a fact AMD has backed out of building the plant in Luther Forest but that is besides the point. I remember the day when AMD the announced their big plans. The native folk were WILD with speculation. Dude I’m serious… they were talking like zombies from outerspace for weeks and weeks after the announcement. It really was a hideous scene that I pitied them. Extremely sad to hear people, deep in denial, hopes sky high, that 1400 miserable $20/hr jobs were going to make up for the hundreds of thousands of high paying manufacturing jobs lost in that area over the past 30 years.
As you probably know, property taxes eat up any profit that homes gathered in this area. After losing 60k Kodak jobs over the last 10-15 years, the area is looking for anything positive. The ones that stay are the rose colored glasses crowd that complain about the property taxes but vote every year to increase the school tax portion of their tax bill, Without drastically lower individual property taxes (businesses seem to get buckets of tax breaks from the state and county), the area is doomed to lose population and chase away businesses. The tax junkies in Albany just can’t seem to understand that point.
Was chatting last night with a gal in Rochester and at one point her house came up for discussion. She closed and moved in right after Christmas.
At one point she was giving me the “you can’t go wrong owning a house” bit and the slightest disagreement of that by me just made her emphasize it all the more. I almost said “have you ever heard of the NAR”?? I was a good boy and kept my mouth shut, but it was a bit of an eye opener.
Well, as long as her mouth was big enough, you have all the incentive to keep your mouth shut.
LOL
“It’s now clear that we have entered what we anticipate will be a mild recession,” said David Seiders, chief economist for the home builders group.
Has anybody else noticed every pundit is now admitting to a “mild recession”. Even Obama alluded to “something worse” in the debate yesterday.
One of my friends had her Geneva house sold twice this winter. Both times the deal failed because the “buyers” couldn’t get financing.
I keep seeing a number of homes being relisted that didn’t sell last year. You know the story where spring is the time to make money on your house, but not this time around.
Geneva is a nice place to visit while doing the winery tours around Seneca Lake, but jobs are tough to find unless your working at the colleges.
Crude futures - $115.10. How long does it take for prices to get through the pipeline and to consumers? As one poster yesterday pointed out, $100 a barrel oil should = about $5.00 a gallon at the pumps. I guess this summer might turn out to be a real shock in many markets around the country…
It should makes you take a serious look at the concept of Peak Oil. Its not just the weak dollar.
http://www.simmonsco-intl.com/research.aspx?Type=oldies
“make”, not “makes”, sorry.
Crude oil are typically purchased 3 months in advance. In about 2-3 month, $5/gallon at the pump is a reality.
I would like some other people’s ideas on how high the price of gas will have to go before we see some fundamental and long lasting changes in lifestyle. Even at $3.25 to $3.50 demand hasn’t decreased and people here still drive their huge SUVs and often commute 50 to 60 miles per day to work not counting running errands. It is popular here to live “in the country” on 5 acres 30 miles from where one works. I personally believe it will take gas in the $5 to $7 range for an extended period, 6 months or longer, to cause significant change. I can say I don’t make as many trips to town for supplies as I would have in the past, and when I do I take my wife’s small sedan when possible.
If I recall, gas in the $4.50-4.80 range will decrease GDP by about 20%. A typical truck drivin good ol’ boy here in smalltown AL is paying $3.28 a gallon for regular x 30 gallons for the standard V8, extended cab, full size P.U. or Suburban. That’s basically $100 a fill, they go through 1 fill-up a week because they live out in the country and drive 75-80 mph everywhere (70 through town - I’m not kidding, especially when the H.S. lets out).
The average family median income in this county is $31,000 a year - which means that they’re bringing home about $21,000 / 54 = $390 a week - Soooooo they’re using 25% of their take home on average for one driver.
The wives tend to drive sedans or smaller trucks more so figure they’re going through about $50-75 a week depending on how they drive - Call it 40% of take home pay for your median family out here in the sticks for gas. Wait till it tops $4.00 a gallon. Drive-offs are already huge. I expect stick-ups for gas will become common (as opposed to gas stations sticking US up…)
the local Bed Bath & Beyond is selling pull-carts (don’t know what their real name is)…I had one when I lived in San Francisco–used it to haul the laundry to the laundromat, to get groceries at the local store, etc.
Interesting to see them here in car-dependent suburbia.
Granny carts?
Our local Container Store has a bunch of them, too. I live too far from the grocery to walk, but it’s reasonable bike ride.
Recently, I found great bike baskets from Wald that are designed for carrying grocery bags. I’m thinking I’ll make that forty bucks back fast, and I might drop a few pounds to boot!
“Granny carts?”
I remember seeing the older women pulling those down the sidewalks in the 1950s. Not a bad way to go, really. I’m looking forward to being an old lady and doing the same.
go granny go!
to redhead68,
An averaged sized backpack (school bag type) holds about as many groceries as one of the hand held baskets grocery stores provide, so it’s not a bad system for grocery shopping with a bike. You just have to be very careful with the egges.
I still have my old ‘Timbuktu’ courier bag (from the days when I was actually a cycle courier in London), same size as the old newspaper delivery bags.
Its astonishing how much it holds: packed properly, sometimes its almost too heavy to carry.
Though, I really like the look of some of those cycle ‘trailers’.
Al…In the Colorado sun, it gets very hot carrying a backpack on a bike, and baskets help keep the bike’s center of gravity low, which adds stability. Furthermore, the baskets are affordable, can carry a lot more than a backpack, and reduce the risk of crushing. And, no, I don’t work for Wald, although I do kind of sound like a marketing type, don’t I?
Awhile ago I installed the old wire “geek baskets” from when I had a paper route onto my current bike.
I can walk to my grocery store, so I got a granny cart 4 years ago so I didn’t have to waste gas for such a short trip. My neighbors all kinda looked at me funny. Not so much now!
LA_Wall…I’m jealous.
I can walk to two stores, 2 miles each from home, but will have to do that at 0600 am in middle of summer, or just give into the gas suck and drive.Stuff will melt by the time I walk home. Now what would that help with?
Oh maybe pre cooked?
“The average family median income in this county is $31,000 a year - which means that they’re bringing home about $21,000 / 54 = $390 a week - Soooooo they’re using 25% of their take home on average for one driver.”
/54? Did we just add 2 weeks to the calendar while I wasn’t looking?
At $31K gross they bring in about $30K given the fact at that income level you pay practically no taxes. Add in a kid or two and you’re in EITC land, meaning your take home is more than your gross for many people.
Sooooo they are bringing home $576 a week, making your numbers off by almost 100%.
And do you realize what 20% off GDP means? Think about it.
You need to seriously, re-evaluate your figures.
Tuesday night I had dinner with some friends. One of them owns strip malls in the Hartford Ct. area…the old-fashioned, simple ones, anchored by supermarkets, with mom and pop stores. Always has done well, now has tenant problems. Reason, consumers pulling back even on small purchases, even his supermarket tenants, with razor-thin margins, are feeling the squeeze.
Of course, they are.
They never had the absurd discretionary income that they appeared to have, and all those strip malls were vastly overbuilt.
The blunt truth always was that there was no need for all those chains out there. Panera and Starbucks every mile or so.
The growth of ethnic stores (cheaper produce prices, generally), and the fact the $1- stores are now a source of food, will have an impact on grocery store anchored outside neighborhood and community centers, in this economic contraction. For people who really need to find alternatives to the high cost of food, the $ type stores, are changing spending patters. The middleclass is getting squeezed big time.
For instance, I only buy certain “add ons” to my needs (salad dressing,miracle whip, etc…) at the grocery store,and hardly frequent grocery stores anymore. Costco for chicken and tuna.
Just compare the cost of spices at the grocery stores v. the ethnic stores. You’d have to be a moron to pay at the local store.
Also, the ethnic stores frequently feature local produce, and have far better supply chains for their “exotic” vegetables and fresh herbs that are shipped in.
And their clientele consists of the most nitpicking nickelfuckers alive. I should know, I’m one of them.
lol. You’re funny. Besides the great prices, its an adventure in both products and fellow humans. I just love being introduced to different cultures. Maybe sometime, I’ll hit someone up for cooking lessons.
Also, the ethnic stores frequently feature local produce, and have far better supply chains for their “exotic” vegetables and fresh herbs that are shipped in.
I can’t do all my shopping in ethnic stores, but the mercados near me are great for Latino staples + citrus, and the local Asian supermarkets can’t be beat for things like watercress, mushrooms, basil and pea shoots — the produce is often 1/10th the price it’d be at Whole Foods or similar store.
Well, nobody claimed to do “all” their shopping there but the produce is far superior to Whole Paycheck.
but the produce is far superior to Whole Paycheck.
Sometimes, though it’s always cheaper. Sometimes it’s of unknown provenance, and often isn’t organic. Not that I require organic produce.
In the summer, I tend to get what I can from the farmer’s market, then augment with produce from ethnic food stores.
YMMV.
Keeping an eye out for the origin country of produce is important. So of the border produce has pesticides we banned 20 years ago (DDT for one). The Breast Dr. gave me some insight. Prostate and Breast Cancers have a link to pesticides, along with plastics, our water supply, and a host of other things. So, no matter where I shop, I ask, read, get informed.
The twins are too precious to lose.
“I would like some other people’s ideas on how high the price of gas will have to go before we see some fundamental and long lasting changes in lifestyle.”
Not much higher, IMO - $4 here in Florida. I was a driver here starting in ‘59 - gas was 20 cents a gallon except during price wars when it went lower When the ‘73 oil embargo and rationing hit, the short-term functional equivalent of price increases in many ways, people couldn’t dump gas-hogs fast enough. It ushered in the sale of a lot of ugly but efficient “foreign cars.” Muscle cars, the sorta-equivalent of today’s SUVs, were selling for peanuts. That’s what will happen when we pass $4 gas here - gas hogs will begin to disappear. I suspect a lot of them will be shipped overseas to countries where gas prices are subsidized.
As for the permanency of these changes, it will depend on the permanency of the price increases.
We finally hit over $3.50 per gallon in Oakland county in Michigan. (your price may vary)
The interesting conversations I’ve heard today between coworkers with campers/RV’s is that gas is too expensive, and are considering “driveway camping”
This, and I’m not seeing the offroad “toys” in the open fields as much tells me that recreational use of fuel is definitely affected now.
Regular gas in Los Angeles (at least, along my commute) is now between $3.80 and $3.99. I haven’t seen it over $4 yet but I also haven’t seen a station selling Super or Premium for less than $4. Usually the prices go $3.96/$4.16/$4.29 or similar.
And we’re not even close to “peak driving season” yet. This summer should be interesting.
I noticed Thousand Oaks (my thumping grounds for home) is at $4.01/premium, and I did see $3.90/premium in the San Fernando Valley last night. I recall hearing on KNX 10.70 Radio, that San Diego’s tourist industry is mostly drive ins. They are planning for a bleak summer. What no PR “news”? Wow, how often does that happen anymore.
After putting in over 60$ today wasn’t fun, but the fwy and streets seem to have less drivers.
Good question. Right now its is looking like certain commodity prices might make their way to consumers at the worst possible time for the PTB - just in time for the much vaunted stimulus checks. Funny if those rebates are even further diminished by high food and fuel costs over the summer.
A week’s worth of groceries, a full gas tank - and that’s about it.
I am so glad I am not buying groceries and gas for a family of six anymore! I actually enjoy riding my bike to town.
Are you stealing groceries now?
Yes, but only for one.
What happened to your family of 6? Did you go Anasazi on them?
LOL.
Disaster barely averted with coffee being splurted on the floor rather than the keyboard.
Olympia,
Sad to say, the spousal unit went off her meds and to the moon, leaving me to raise the four munchkins. They are all well and happy now as adults, only bothering me occasionally to present a grandchild or go out on the boat with me.
“And I’m like, thanks a heap coyote ugly, this cactus-gram stings even worse than your abandonment.” - Juno.
God, these “economic stimulus checks” are ridiculous. I’ve got a good income, so according to the Guv-mint I’m the kind of person who will go ahead and spend, Spend, SPEND that money — but instead, I’ll be throwing mine at paying off my computer faster.
Do they really think people are gonna just blow this on smokes and a vacation? I’m thinking most people are going to be glad to have that little bit extra just to buy groceries and fill the tank, assuming they don’t use it to try to forestall forclosure for another month.
Stupid.
Oh quit your whining. If you don’t want it, send it over to me. I won’t be getting a check you see since the govt thinks I’m too rich to deserve one. I’d love to have $1200 in late may, it will come in handy as I write my check to the IRS for quarterly tax payments in June.
troll
Yes of course. I must be a troll because I don’t buy into the nonsense I read here. Is this what passes for debate these days?
1 in 33 homeowners will be in foreclosure in the next 2 years according to Pew Research…
http://www.pewtrusts.org/news_room_ektid37950.aspx
WAY optomistic. 115 million households with 70% ownership is $80 million owners. 1 in 33 is only 2.4 million foreclosures.
8-9 million are already upside down with 20 million likely.
I think it will be closer to 10 million houses that go back to the bank (either through foreclosure or jingle mail). 1 in 8, not 1 in 33.
cynicalgirl,
Thanks for the Pew Research link; they have a state-by-state summary, and wow, TEXAS was second only to Mississippi in subprime loans as a percentage of all loans (34%) in 2005 and 2006….! Guess TxChick was spot on about the situation in Texas….
amazing, isn’t it considering how “cheap” Texas is. What it is is a commentary on the awful credit quality in this “debtor friendly” state.
Yes, it’s hard to take this study too seriously. Take this gem from the Colorado (my state) “fact sheet”:
“Affected homeowners are expected to lose $4,251 on
average from property values.”
Homeowners around me (Denver Metro / Northern Colorado) have already lost far more than that - try on the order of 10x more.
Are Colorado Springs and the Western Slope appreciating that much… or at all…
The problem is thier research is based only upon owner-occupied units. In most bubble markets, it was the speculators that used the riskiest mortgage products, and are the ones really willing to just “walk away”.
Very interesting link. I agree with Darrel that its too optimistic, though. For IL it projects an average loss of $10K, but (going off of Housingtrackers price declines) the median house has already lost approx. $15K - and even that’s less than what I am seeing on the street.
Also, it covers subprime, but there is no info on non-conforming Alt-A loans (of which IL has plenty, and they aren’t performing well).
Dodd watch:
There are only a few weeks left for Congress and the Bush administration to agree on large-scale government intervention in the mortgage market, according to Chris Dodd, one of the most senior lawmakers overseeing US economic policy.
http://us.ft.com/ftgateway/superpage.ft?news_id=fto041620081713149197
So, if there isn’t a solution passed and enacted in the next few weeks, then we won’t see ANY more proposals since it will already be too late….. RIGHT?
Reminds me of the environmentalists. We must do something in the next 2 years, or it will be too late. 2 years later: We must do something in the next 2 years, or it will be too late. 2 years later: We must do something in the next 2 years, or it will be too late.
For 10 years they said we were destroying 5% of the rain forest each year. At the end of the 10 years, total rain forest was down 7%. 7% loss is bad, but is NOT 5% per year for a decade!
“Bailout now or housing will be affordably-priced forever.”
Now THAT’S a bumper sticker!
While Mr Dodd said “there is obviously some risk” to taxpayers associated with the plan, he claimed it would help “determine a floor in residential mortgages” and said that doing nothing would allow contagion to spread across US financial markets and the economy.”
“claimed” is the operative word in this little gem.. the Wall Street Banker thugs whisper what to do and how to sell it in his ear so Dodd can “claim” it..
“some risk” to taxpayers… another reason why I broke ranks with the fork-tongued and hypocritical Democrats, esp this schmuck..
I don’t see my response to this post, so I’ll shorten this one and just say Dodd is a Wall Street Pimp and nothing more…. He’s also very poorly educated on history and finance obviously..
–
And what about people who elect him and re-elect him? Are other Senators much better?
And one of those Senators is certain to be our next President.
Jas
“Chris Dodd, one of the most senior lawmakers overseeing US economic policy.”
If this is one of the jamokes overseeing US economic policy and we’re in the situation we are right now, we’re in deep doo-doo, to quote Mr. Toll.
Lingering bailout prospects may be a major reason for the high vacancy rates which are inflating rents in places like San Diego (the vacancy rate was recently reported at 3 pct here). Banks holding REO may keep their homes priced at levels where there are no buyers so long as they can hold out hopes for a massive taxpayer-guaranteed reflation into which they can sell their overpriced REO. Once bailout hopes are deflated, I expect SD housing to finally start seriously correcting towards affordable price levels. Perhaps this should be termed the govt’s accidental affordable housing policy.
P.S. Even if a larger-than-expected bailout materializes, the long term effect of respiking the punchbowl will be more overbuilding, more downward pressure on prices, more foreclosures of homeowners who bought at the bubble top, etc. The only way out is wage inflation, and that is hard to achieve with cheap Chindian labor only an ocean away.
Rents in county rose in 1st quarter
Region’s average rate ranked sixth in state
By Emmet Pierce
STAFF WRITER
high vacancy rate?
OC/LA rent hikes lowest in 8 years
http://lansner.freedomblogging.com/category/apartmentsrents/
So much for the theory that foreclosures will drive up the cost of rent for everyone else. More likely, many of them moved in with family members or left the county or state altogether.
Just spoke with friend who is divorcing and now living with his mom till he gets a place..dblewide. Wife took money from refi and somehow it got way laid. He isn’t upset that he was hoodwinked. Guess that 12 step plan calms folks down?
Guys age.54
There are a lot of people in my community as well holding out for their bailout money.
rising rates:
April 16 (Bloomberg) — Brazil’s central bank Governor Henrique Meirelles, who yesterday lifted interest rates for the first time in three years, is betting he can contain inflation by tightening monetary policy more aggressively than economists anticipated
http://tinyurl.com/5s389b
Same story in India, although there is definitely a public acknowledgement that scarcity rather than monetary policy is the biggest driver of inflation.
That’s only true if the good in question is actually scarce. If goods can be produced easily on demand, like a car, then scarcity doesn’t apply.
Time lag delay though.
The rupee is effectively pegged to the dollar. Yeah, yeah, yeah, I know about the basket and the fiddling by the RBI but the fact is they have lived with loose policy for far too long.
Merrill Lynch cutting 4000 jobs. How’s that Manhattan condo market??
I thought they threw in the kitchen sink (and then some) with all the write-downs last quarter ??? You mean there’s more ??? Say it ain’t so !!!
If I recall, that’s the total number from selling a couple of their divisions and closing down a couple of more + whatever they decided to cut this time.
Should I be worried that my co 401 k is managed by JP Morgan?
I think so, but don’t know anyway to find another 401k and actually be able to switch it.
“How’s that Manhattan condo market?? ”
It’s great. I see inventory coming online everywhere. Bwahahaha. Take that Broad Street. Good luck on the William Beaver House.
http://www.williambeaver.com/nav/residences/PDF/G07-40.pdf
The incredible amount of wasted space and poor layout, mind boggling……..A walk-in closet off the Bathroom….mold mildew?
door for the toilet? wasted space behind bathroom door?
Louvered doors next to a TUB? water dripping leaking? wasted wall space The bed in the bedroom looks weird? queen is 60×80…that looks like 80×60? And who lives with 1 dresser?
The living room with a 2 seat couch? looks like you cant even buy a sofa bed for guests……..And the wasted walk space when you come in the “front” door…
And a “Murphy office”, who is their market? people who own Nothing and their lives revolve around a Laptop?
A walk-in closet off the Bathroom
That is quite the style in newer homes to access the walk-in closet via the bathroom(at least in Texas). And as for mildew, it has also been the style in Texas to have your bathroom carpeted.
Ditto in Florida, Alabama and Georgia. In many cases, it appears to be so that the closet window facing the street looks like a regular window, rather than bathroom “blocks.” My wife hates it; I don’t care much except that it’s inconvenient. A workaround solution is a strong, quiet exhaust fan high in the john and shower areas, either into the attic or outside.
The seperate access to the closet is so you don’t have to disturb your spouse or partner when you get up in the wee hours to make your ridiculous commute. No kidding.
There have been many many times when I have longed for a door just for the toilet. That would be an expense well worth it’s cost many times over (for everyone in my family).
When I add on to my little house, in the new bathroom the toilet is going to be separate from the bath / shower / sink. Toilet in it’s own little space with a shelf or rack for reading material. Bath / shower / sink in a separate space that connects with a dressing area adjacent to closet. Bedroom just big enough for the bed and nightstand.
SFV… Can I suggest Fiber and lots of it, less meat, and oh, a nice environmental spray or courtesy flush?
http://www.williambeaver.com/nav/about/bathing.html
I could see .007 and some beauty enjoying the view.
They initially marketed the units as soft porn. You’d think with that strategy they’d have sold out by now.
I like that the bedroom has foldable wall partitions (or whatever you call them) adjoining the bathroom, so you can watch someone shitting from your bed. Also, for a good laugh, take a look at what they are calling the third “bedroom” in the 3-br plans.
And I thought Silicon Valley housing sucked.
The “guest room” that’s a fold-out couch in the living area?
I’ve never felt the urge to watch someone shit. But I’m not as sophisticated as people who live in tall buildings.
On the corner of 86th and West End, condo tower with foundations still being poured, described as “21st Century Prewar Condos” (I am not kidding). Was okayed for 15 stories, priced in megabucks.
Now developers are asking for 20 stories. So, they figure they can’t get the prices they want for 15 floors, lower the asking, and add floors to make up the difference. Yeah, no problems here in Manhattan.
The project on 72nd and Broadway also seems to be going up in flames. And those Apple Bank condos, well, after being “sold out”, now they are selling them again.
BWAHAHAHHAHAHHHHHHHHHHHHHHHHHHH!!!
Actually, the reason is that EVERYONE in the country who wants to live in a luxury high rise condo is going to buy one in Austin. Too bad, Manhattan.
More money destined to be taken out of the system.
Citigroup’s Pandit vows major cost cuts
By Francesco Guerrera and Ben White in New York
Published: April 17 2008 18:18 | Last updated: April 17 2008 18:18
Vikram Pandit, Citigroup’s chief executive, has vowed to slash the beleaguered financial group’s cost base by up to 20 per cent, deepening fears that Wall Street and the City of London are about to be hit by tens of thousands of additional job losses.
considering the horrible customer service i got the other day from sheettibankypoo…firing 20,000 morons will not be enough
schizophrenia:
Though consumer prices stayed elevated last month, there were signs that inflation has started to recede, welcome news for the Federal Reserve as it tries to avert a prolonged recession while keeping prices in check.
http://tinyurl.com/6ltnzv
Falling interest rates and rising demand for basic materials and foodstuffs is an almost guaranteed recipe for inflation, and price pressures were evident around the world on Wednesday.
In the United States, the March Consumer Price Index showed a 4.0% year-on-year rise, reflecting soaring food and energy costs, while inflation statistics in the European Union and China also showed serious increases.
http://tinyurl.com/5lvra2
“there were signs that inflation has started to recede,”
Sure, and Warren Buffet kicked the bucket and left his fortune to me.
The Fed’s inflation gauge isn’t realistic, critics say
By Dean Calbreath
STAFF WRITER
April 17, 2008
You’ve seen the cost of a gallon of premium gas breach the $4 mark at local stations. You’ve seen the price of milk, eggs, corn and bread surge at your supermarket. Yesterday, the government confirmed that prices are continuing to rise at a very brisk pace.
Looks like the Fed has a fairly weak case for further rate cuts. I don’t expect that to stop them, though.
If they reverted back to including food, energy and housing, what would the inflation number be? Would the housing decline dwarf the cost increase of a loaf of bread?
Well of course! Article one is the REAL inflation. Article two just deals with food and energy, nothing that’s really significant to the consumers… Move along, nothing to see here.
I don’t see why they don’t just report TWO inflation numbers — one with food/energy and one without. Even JoeSixPack could probably comprehend two numbers.
Oh, wait…maybe they that’s why they don’t report it. They don’t want JoeSixPack to know how inflated the prices are for torches and pitchforks.
Holy Cow! I just returned from picking up a prescription downtown - the price of gas at the Chevron station just spiked 8 cents overnight! $3.38 a gallon - in no-where Bama. I took a drive down to the Wally World (which sets the price in town) and it’s still $3.29 there. But they change over at 2:00 pm everyday so I went over to the Shell station next door (bad place to be for them, but I like the gas) and filled up at $3.31, they change at 2 as well. Here comes $4 and serious spike in crime for the 50% of the town who live on the dole.
I know it’s old news to the Cali folks, still it’s a shocker. Spiked here yesterday to $3.49. $4.27 still for diesel.
RE: Holy Cow! I just returned from picking up a prescription downtown - the price of gas at the Chevron station just spiked 8 cents overnight!
It was a 10 cent increase at the Mobil Mart I frequent!
High Test @ $3.59! And it’s MUD SEASON here in the Northeast. The real driving season hasn’t even started
Time to get the RoadGlide out.
No probs Blano - remember that everything over here in CA is overpriced, so the ’sticker shock’ is less acute.
For places like AL where median wages and prices are lower, I’d expect the hike to be (and feel ) more extreme in comparison.
Still, $3.49 is on par with my gas station down the road here in Van Nuys (San Fernando Valley). IIRC, last week - when I last filled up - it was $3.60 -ish.
in Netherlands gas passed the $ 9.50/gallon mark this week; certainly over $ 10 before summer.
Out here in SE Utah it’s $3.49 for midgrade.
Not seeing the locusts of off-road vehicles ripping up everything, at least not as many. So there is one good thing about it. I recall having a conversation years ago around a campfire in Canyonlands Nat’l Park wherein we all agreed that someday this remote country would be accessible only to the wealthy.
Time to do a “Michael Jackson” and grab it- hold on for dear life!
$3.69 lowest in town. Palm Springs valley. Same for San Berdo/Redlands area.
Re-asking catspit’s question from yesterday….
Time to dive in to SKF (again)??
It seems to be mispriced every morning in the premarket and is good for $1-3 flip, sometimes long, sometimes short. I did it long yesterday. I wouldn’t buy it to hold now, no.
Not thinking long. Just a couple points here and there is good enough for me, for now.
what do you think its in a free fall?
hi tx, are you watching dcr? seems like oil is due for a 5-10 pullback. i picked up some more this morning at 3.8.
No, kind of on auto pilot now with some summer index calls until another shorting op sets up. I’ll check it out. Right now, I’m more interested in the campaign than the market.
I like it. I’ll give that a shot.
Matt, thanks for sharing - I’m in for a few shares.
Financial stocks soar on grim news
JPMorgan is latest bank to report drop in profits
By Eric Dash and Vikas Bajaj
NEW YORK TIMES NEWS SERVICE
NEW YORK – On Wall Street, the bad news looks like good news. One big bank after another has reported grim results this week, and more gloomy tidings are expected in the days ahead. But for the moment, investors do not seem to mind: After months of disappointments, they are just relieved the banks are not doing worse.
Fair is foul and foul is fair
Hover through the fog and filthy air.
Whose job is it to ensure the stock market always goes up on bad news days? I have a hard time believing this phenomenon is merely due to the collective and decentralized action of a lot of individual investors who all “know” that the stock market always goes up on bad news, though this is technically possible.
It’s been me all along, I confess.
No — your job is making sure gold prices stay bubbly
If only you had a little RumplestiltSkin in the game…
I’d rather to have no skin in the game, but that is not an option when a War on Savers is underway.
Even on days like today when the initial rocket shot movement on U.S. headline indexes gives way to weakness, the market does not correct in line with the bad news. I guess the omniscient, forward-looking U.S. stock market must have priced everything in already by last fall…
It’s very bizarre I have to say. At this point it looks like the only thing to bring the markets down will be when a few index components start going bankrupt. GM will probably be the first.
Macro market P/E will soon go infinite as EPS averages go below 0. How can one price according to fundamentals, when there are no fundamentals?
I think I’m getting it now. See, when I first heard of Cramer and Kudlow and people like them, I thought that they were just entertainment. I couldn’t believe that serious full time traders and financial types ever listened to these guys. Now, I believe that they do listen to them. This means that the WS financial wizards are no better than Cramer, Kudlow, Burnette, Bartoroma, etc.
I think I’m getting it. WS is no better than Las Vegas or Hollywood .
Geez.
Roidy
Fewer permits for housing construction being issued
By Roger Showley
STAFF WRITER
April 17, 2008
San Diego County agencies issued near-record-low numbers of building permits last month, the Burbank-based Construction Research Board reported yesterday.
Why Lenders Are Leery Of Short Sales
This Foreclosure Alternative
Helps Strapped Homeowners,
But It’s Not Easy to Pull Off
By RUTH SIMON and JAMES R. HAGERTY
April 17, 2008; Page D1
Banker: Same problems as with LTCM, only bigger
‘Interlinked’ nature of derivatives industry highlighted in Vienna
By Steve Goldstein, MarketWatch
Last update: 7:27 a.m. EDT April 16, 2008
VIENNA (MarketWatch) — The derivatives industry is facing many of the same problems as when it was dealing with the Long-Term Capital Management blow-up of a decade ago, only on a larger scale, a leading banker said Wednesday.
Paul Calello, Credit Suisse’s chief executive for investment banking and a participant when the Federal Reserve Bank of New York helped engineer a bailout of hedge fund LTCM, told a conference that the industry — long a foe off direct regulation — needs to ramp up electronic trading as well as measure accurately the size and risks of trades.
The room needs to be cleared of these, the smartest of the guys, and replaced with those that have some common sense.
Fed’s Kohn: U.S. financial system has major weaknesses
CAPITOL REPORT
FHA is cornerstone of housing rescue
Depression-era agency seen as best hope for struggling homeowners
By Ruth Mantell, MarketWatch
Last update: 6:56 p.m. EDT April 16, 2008
WASHINGTON (MarketWatch) — While the White House wants to avoid moves it sees as bailing out irresponsible mortgage borrowers, observers say it’s likely that lawmakers looking to be reelected this year will expand the reach of the Federal Housing Administration to keep more borrowers in their homes.
$uperman’s weakness is Cryptonite…
Et nunc, reges, intelligite, er udimini, qui judicati terram.
Hoz, not eru dimini. it’s one word…
LOL
And now, kings, understand; you who decide the fate of the Earth, educate yourselves.
RE: HUD/FHA
The most corrupt and inept of all Federal government agencies.
Fed’s Kohn: Weaknesses in financial system need attention
By Greg Robb
Last update: 10:09 a.m. EDT April 17, 2008
“Kohn also expressed concern that small banks may have too great a concentration of loans tied to commercial real estate.”
they are now just figuring this out??? i could have told them that a long time ago. all you have to do is look at who is financing all these strip malls while driving around!
Credit Tightening:
HOG is limiting bike loans to 100% LTV from here on out - no more 130% LTV loans so wannabes can stock up on poser gear before even leaving the showroom.
130% LTV loans on a vehicle? Nah, credit wasn’t too loose at all.
Thats one business I’d like to see go up in flames. Quick story…. On a previous project in NJ, one of the equipment operators proudly announced he bought a Hardly Ableson. I asked him if he got his costume…. He said “what”? I said, “did you get your costume?”? He’s like WTF are you talking about???! I said, “you know, your Village People costume to wear when you ride your scooter”…. He went berserk….. lmao.
LOL I’ve got nothing against bikes - would be fruitless this close to Daytona - but that’s a really funny story.
It really was hilarious because the guy is a volatile type you’d see in a Cialis/Viagra commercial. He’s the same guy who tried to attack the dozer operator with his 15ton roller because he got bumped for overtime. I’m dying here thinking about it.
LOL.
Are you sure you should’ve asked that Q above to such a volatile character?
You’d be surprised how little violence there is (outside of the boroughs) on construction sites. It’s contrary to typical thinking. But yeah… some of the stuff that goes on on big sites is hilariously memorable. Think about it…. some of these guys off the bench have an IQ of about 10… lmao. They’re good at what they do but don’t ask them to think beyond that.
Yeah, yeah, yeah, I know a bunch of these characters, and they’re all harmless and gormless too, I’ll add.
However, they do pout for a while, and you do want them to pick up the beer and whisky tab with all the money they made from their new house.
I know of what I speak.
LOL! “Village People costume”! So true!
and “your scooter”…. LOL
HELOC’s Angels
also from the article:
Harley’s results were also pulled down by its in-house financing arm, where operating income plunged nearly 41 percent because the turmoil in credit markets reduced income from the loans the unit securitizes.
this just shocks me!! were they selling these securities to over seas investors also? this is mind blowing! what else were they bundling up to sell to suckers?
Even back in the mid 90’s when I was in private practice, we were doing securitizations on loans for industrial equipment, cars and credit card receivables.
I heard a rumor at my current office about someone wanting to securitize the micro loans offered to small business people in developing countries - like $100 to build a second oven for a bakery in Pakistan. Don’t know if that ever happened.
Guy i work with just picked up a sweet new, ah, FatBob? way off MSRP, like 13k out the door—and this is the OC, vehicle-freak central. HD actually makes some nice bikes anymore.
LA Times a while back had a story about the crazyness in auto financing…people would want a new vehicle, but would owe more than it was worth, so they would get financing of *over* 100% in order to buy a new vehicle and pay off what was left due on the old (after sale/dealer buyback). Auto companies got addicted to it, as it was a way to get buyers into new cars. Buyers’ loan balances would go up every time the bought a new car, which tended to be every two years. This kind of financing wasn’t directed at the high rollers, it was dished out to Joe and Jane 6 Pack, as a means to get what you want, you *can* afford a new car every two years. It’s truly scary what auto financing has been like.
Yep, got a stepson J6P who rolled one truck loan into another, looking for that perfect Image. Didn’t like this, didn’t like that. He’s been doing this for 10 years so it’s nothing new. It amazed me that he was able to buy a nice house, too, but now I’m understanding it more.
And that kind of financing went on EVERYWHERE.
The automakers have been building unaffordable cars and trucks for several years now (I was priced out of the new car market around 2001). The only way they have been keeping it going is with crazy financing, or by extending the loans out to 6-7-8 years.
I’m curious to see how the Japanese and German manufacturers make out in the future. They pretty much dominated the snob markets in California and the northeast; I think that BMW, Acura, Lexus, Infiniti, Mercedes, etc. may end up getting whacked harder than the Detroit boys when it’s all said and done.
The smart luxury buyer gets the year-old car that the fool has to sell. A good car is worth its weight in gold.
http://tinyurl.com/5nfj2w
I guess reform of the tax code is to much to hope for.
“There’s no question the U.S. tax code is full of special tax provisions that favor housing. Among the biggest breaks are the mortgage interest deduction, the deduction for state and local real estate taxes, and the capital gains exclusion for homes. (The first $250,000 in profit is exempted from capital gains taxes for individual filers, and $500,000 profit for couples.) The federal tax code funnels more than $100 billion annually into the housing sector, estimates the Tax Foundation in Washington D.C.”
“This figure doesn’t include the mammoth subsidized institutions that support the housing and mortgage markets. This includes Government Sponsored Enterprises like Fannie Mae (FNM) and Freddie Mac (FRE) , to name only two of the best known players. The Congressional Budget Office estimated that in 2003 the benefit of the explicit and implicit ties to the federal government for GSE such as Fannie Mae and Freddie Mac amounted to a federal subsidy of more than $23 billion, according to economists William G. Gale, Jonathan Gruber, and Seth Stephens-Davidowitz in their 2007 paper, Encouraging Homeownership Through the Tax Code. “
Frank, do not forget interest deduction on Helocs: an incentive to spend.
I can assure you that the US tax code is VERY tough on homeowners compared to the Dutch tax code (and probably some other EU tax codes).
The Netherlands allows all mortgage costs and other costs associated with buying/owning a home (including garden, swimming pool, garage etc.) to be deducted for the full 100% from taxable income. With a +/- 50% income tax for most people that means that the government pays 50% of all housing costs. All capital gains from homesales are totally tax free, no limits even if you pocket a few million from the sale. And local RE taxes for homeowners are usually so low that US citizens would think that one or two zeros are missing. The Netherlands spends more than 10 billion every year on homeowner subsidies and tax breaks (for a country the size of the US scale that would amount to at least 200 billion).
Sallie Mae affirms outlook, warns of “train wreck”
On the conference call, Lord said Sallie was being flooded with loan applications from students, reflecting the exit of dozens of other lenders from the business.
“Far more have left than have announced they’ve left,” he said. “We’re operating, as everyone is, in some fairly strange capital markets.”
He said loan demand at Sallie was running at $3 billion a month, while the company has only been able to access funding of about $1 billion a month — at record-setting costs.
http://biz.yahoo.com/rb/080417/studentloans_salliemae_outlook.html?.v=1
American Assignat Assets?
(triple-AAA rated)
______________________________________________________________
“Originally meant as bonds, they evolved into a currency used as legal tender. As there was no control over the amount to be printed, the value of the assignats exceeded that of the confiscated properties. This caused massive hyperinflation. In the beginning of 1792, they had lost most of their nominal value.”
“This hyperinflation was stirred up by repeated food shortages. Instead of solving the financial problems, the assignats became a catalyst for (food) riots. Instability continued after the abolition of the monarchy, exacerbated by the wars France faced. This situation impeded the implementation of good financial policies that would reduce debts. Bills such as the Maximum Price Act of 1793 aimed to regulate inflation.”
http://en.wikipedia.org/wiki/Assignat
Funny thing is, after tossing out the Bourbons for what? 30 years? they put em right back in charge again didn’t they? Some sheeple never learn. Oh wait! That describes OUR sheeple doesn’t it?
Regarding that article in the Union Tribune yesterday morning:
http://www.signonsandiego.com/news/business/20080416-9999-1b16neighbor.html
In true Pulitzer price winning style, the UT asks an independent expert (*) about the OB market…..
* (realtor Cindy Wing, Ocean Beach, who was the agent selling the house in the example, and had to re-list several times and drop the price $350k to sell)
I have been making my own Case Schiller index for Ocean Beach , 92107, back to 1997, using this link:
http://users.ixpres.com/~gtriphan/08-1-107.htm
I thought it would be interesting to see what a search on houses that sold in the last 6 months shows as price “increases”. I have only included houses that were bought within in the last 4 years.
9/24/2004 1990 Mendocino Blvd $722,000
10/26/2007 1990 Mendocino Blvd $775,000
5/16/2006 1629 Sunset Cliffs Blvd $695,000
10/12/2007 1629 Sunset Cliffs Blvd $600,000
12/20/2005 1021 Alexandria Dr $850,000
11/29/2007 1021 Alexandria Dr $800,000
3/22/2005 4496 Cape May Ave $875,000
11/26/2007 4496 Cape May Ave $715,000
1/4/2007 4472 Granger St $1,055,000
11/14/2007 4472 Granger St $1,240,000
3/14/2005 4407 Temecula St Unit #2 $320,000
11/16/2007 4407 Temecula St Unit #2 $225,000
6/3/2005 4036 Caminito Espejo $536,000
12/31/2007 4036 Caminito Espejo $444,900
11/16/2005 5130 Long Branch Ave Unit #D $515,000
12/21/2007 5130 Long Branch Ave #D $379,900
11/12/2004 4475 Osprey St $960,000
12/7/2007 4475 Osprey St $779,900
8/28/2006 4627 Del Monte Ave $829,000
1/25/2008 4627 Del Monte Ave $829,500
12/9/2004 1575 Ebers St $630,000
1/30/2008 1575 Ebers St $540,000
10/29/2004 4627 Osprey St $868,000
1/28/2008 4627 Osprey St $820,000
11/3/2005 4617-19 Brighton Ave $699,000
02-22-2008 4617-19 Brighton Ave $589,000
2/13/2004 3822 Centraloma Dr $667,000
02-15-2008 3822 Centraloma Dr $625,000
6/12/2006 4755 Long Branch Ave $732,500
3/17/2008 4755 Long Branch Ave $565,000
The 4472 Granger St is a bit weird, probably an extensive remodel, or did prices go up 20% in 10 months?
It was listed at $1,250,876 on 8/17/06 and sold 6 months later for $1,055,000. 10 months later it was listed at $1,275,000 and sold in less than a month for $1,240,000.
It’s almost heartbreaking to read this: “I feel a little stretched, but I have the income potential, and I plan to stay here for awhile,” said Godfrey, 31. “I joke around that people will be dragging my body out of here in 50 years”. So she can’t afford it, but expects her income to rise? We looked at that house a couple of months ago (it was from 1928). Let’s just say: it won’t be there in 50 years unless she spends some real money on maintenance. It might look like a old world Spanish house that would last for centuries, but it’s actually a California stucco-house, and believe me, it needs work if she wants it to celebrate its 122th birthday….
My place was on Saratoga. I liked it there but not 1.2M worth.
Are those truly repeat sales? You remind me that there will soon be a very rich data sample for updating the Case-Shiller index for San Diego, once all the homes that were already built and sold once since 1998 finally are listed and sold at market-clearing prices.
Speaking of the smartest guys in the room, I got an e-newsletter from Senator Cornyn today:
“…While we’re not immune to national economic trends, I am struck by the ongoing vitality of Texas, in contrast to deteriorating economic times in other parts of the country—and I’m always impressed by the optimism and pride of Texans everywhere. It’s clear that we’re doing a lot of things right in Texas: That’s why we’re growing, and that’s why people want to move here. These observations remind me that one of my major duties in the Senate is to bring more Texas values to Washington.”
What a tool that guy is.
Yeah, got the same note.
I know one “resort” area that is maybe 15% off the peak, but in my hood of 2000 homes, 80 are listed and 20 are under contract. Not too bad considering the state of things. Our prop taxes are about 1/5 of ca and 300 days of sun a yr, today it is snowing. fyi
April is the cruelest month…
WHEN that Aprilis, with his showers swoot,
The drought of March hath pierced to the root,
And bathed every vein in such licour,
Of which virtue engender’d is the flower
PLEASE! No more! I had my fill of Chaucer in the 9th grade when my English teacher made us memorize all that….
You’d love Edmund Spencer…
then goen folk on pilgrimages
on bended knee, to their brokerages…
(or something like that)
I like to look at the weekly So. Cal. foreclosure reports for my county. I fell behind and opened four today. The one for 4/7 was 469 pages long, with 3 homes per page. They’re usually 50-100 pages. Not sure what happened there but I feel sorry for those poor court clerks. It’s gotta be a nightmare working there right now.
Link please to foreclosure reports. And how do you enter co or is it obvious?
Thanks
Bugs:”eh, what’s next Warner Brothers?
Daffy: “That’s despicccccccccccccccccccccable!
Foghorn Leghorn: Hey boy, come here…yeah you son…now listen here, I have this US Thrift Bank I want you to sell to that dawg over there…now this is what we’ll do see…
INVESTMENTS
Billionaire plans to buy U.S. banks
Billionaire financier Wilbur L. Ross Jr. plans to seek about $4 billion from investors including Arab sovereign funds to buy U.S. depositary banks.
Ross, 70, said he would talk with Persian Gulf investors in Abu Dhabi next week about 100 to 200 so-called thrift banks. He plans to package U.S. thrift bank acquisitions “as a finished product” to sovereign wealth funds, he said.
http://www.latimes.com/business/la-fi-briefs17apr17,1,6424798.story
I am looking for a place to “sit it out” for a yr after i sell? Needs to be safe, family friendly, US time zones and cheaper COL than the US. Anyone ever been to Buenos Aires? San Miguel, Mex, Puerto Varrata, — thanks. i can run my business from anywhere and have 2 young kids (3 and 7).
Panama City, Panama. Great place, lots of ex-pats, cheap, and the scenery is terrific. Plenty of American schools and businesses too from the old Canal Zone days. I’d go back in a heartbeat.
Thanks! I like Mexico, but not so much with young kids.
You may need to sit it out for more than a year…
BA is pretty nice. I hear. I visit often for business,and Sao Paulo is nice too. But more expensive. Santiago Chile is cheap and in all places the food is terrific, especially the wine.
A short time ago in history:
from The Motley Fool
The Best Investment Ever
By John Rosevear May 16, 2007
“Suppose I told you about a spectacular investment — something that was low-risk, but delivered strong returns year after year, with almost no down years and tax advantages that no other investment vehicle could match? Such an investment exists, and it’s almost too good to believe…
…And the biggest advantage of all? One that no stock or mutual fund can match?
* You get to live in it!
I’m talking about a home, of course….”
http://tinyurl.com/5awopx
Hows that investment strategy look this year?
Home Sick
Not even a year ago!!!!
like it was a good idea in 2001.
http://biz.yahoo.com/cnbc/080417/24184071.html
commodities boom still going strong
be on the lookout for a food riot in Australia….that would be significant…or union uprising…same same, but different.
Just back from breakfast and a chance to dirty my hands, reading the L.A. Times…
According to them, the rise in cost of oil is offset by the price of clothing going down~
Anybody fill up their wardrobe a few times a week?
ha- hah
If you sell your house for a 250K profit on top of 150K of normal income will you be subject to the alternative minimum tax in the same way that you would if you had 250K in long-term capital gains?
sellin?
I’ve been a loyal reader of your blog since 2005 when I started looking for houses in DC and decided to move and live in VA with my girlfriend. However, I am having some difficulty convincing her that NOW would be a really BAD time to purchase anything within the DC area. This is even after having showed her the S&P Case Shiller housing index, your website, Calculated Risk Blog, Irvine Bubble Blog, etc …nothing seems to work. She refuses to believe the DC area will suffer a decline in prices (Incredible, I know!!!).
Anyhow, I’m curious if there are additional resources (other websites, etc) that I can find the projected expected decrease in prices, rent to purchase price index, etc for the DC area.
Thanks!
PS I am writing this because she just called me for the seventh time today (since 10:00 am) about a cute little house we should look at, instead of renewing our lease. Exasperated? Yes, I am!!!
How about compromising and finding a house to rent or something along those lines? Maybe she’s sick of the apartment and wants to feel more traditionally domestic. She can get that from a SFH optimally, or a nice townhouse.
If she won’t compromise at all, well, you’ll have to consider whether you want to capitulate, and all that entails.
It might be better to rent a larger house for the same payment than buy now. Paying too much… but you can get out relatively “quick” at need.
It sounds as though, if you truly believe now is a bad time (and I think you’re right), you have to put your foot down and just say no, I’m not doing it right now, PERIOD. And be willing to tolerate the subsequent fallout.
I actually thought of suggesting that to her, however, I’m uncertain about potential landlords paying their mortgage and in the end we’re forced to move. Although, this would be a townhouse and not a SF.
How one country is killing the “carry Trade”.
Peru fights back
beginning next month
“Elevation of reserve requirement from 40% to 120%, which will not be remunerated, to the obligations in national currency for non-residential financial entities.”
Be interesting to trace the moneys leaving Peru. Also may make the SOl the only currency in the world (excluding Zimbabwe) that will have a currency weaker than the dollar. It will make a lot of Peruvian imports to the US cheaper.
Can you translate from bankerese (or was that Peruvian?)
Hoz,
I loves the way you think.
I would argue that the YEN is the heartbeat….
I like long Korea, cultural conservatism with liberty and freedom.
Real was weird in the AM, a V shaped curve that lasted only a short time.
based on this, long Korea, Brazil, and YEN.
Short Euro, Ozzie, Pound.
FED pause or market dissapointment of quarter point, hammers gold, oil, food, and steel…equity sell off, buy the panic with short treasury positions.
Korea has a good future-
one more for ya in the W&W thread ……..keep plugging in the HBB.
IT WORKS!
they are buying dollars, pesos, and real.
Hoz:
Im going long tomorrow technically damaged, panic…the world is ending, and this stock is the worst ever….
you cant find dumber money, Ill tell ya about it when I sell….might be some time….but a 20% up move would caution one to divest a portion….
TMM……1.77…ran to 1.92…funny little moneys.
Rent a house anywhere.
I know it is off the cosmopolitan path, but dang, for the money, a few friends could kick back a year or two while rocks melt:
http://joplin.craigslist.org/apa/640976048.html