Bits Bucket For August 14, 2008
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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http://us.rd.yahoo.com/finance/finhome/topstories/apf;_ylt=AlJU5gS0ZjeXRnEZvZLvLHu7YWsA/*http://biz.yahoo.com/ap/080814/foreclosure_rates.html
US foreclosure filings surge 55 percent- AP
The number of homeowners stung by the dramatic decline in the U.S. housing market jumped last month as foreclosure filings grew by more than 50 percent compared with the same month a year ago, according to data released Thursday.
The market should be up bigtime today. Clearly we’ve hit bottom!
BUY NOW OR BE PRICED OUT FOREVER!!!!!!!!!!!!!!!!
this morning on the am news station in nyc 1010 wins they said
Alan Greespan said the housing market will stabalize in early 2009
so it is safe to buy in early 2009
now crawl back in your cave douchespan
How many times has that clown called bottom? More than Larry Kudlow?
He’s seen more bottoms than Larry Flynt.
Hahahaha! A comical start to my day.
Say, NYCityboy, where WERE you for so long? I went to Utarr for two short weeks and when I got back to civilization and computers you were nowhere to be found, not ’til recently. Neither was losty. I sadly speculated that maybe you’d been trapped under the weight of your liver and couldn’t get off the couch. Is that what happened? If so, have you trained your cats to bring you bottle of Jack Daniels, porridge, the remote, stuff like that? Hey, maybe you’re dictating to them right now, and your post was laboriously typed with their little furry paws! Is that how it is?
(As for losty, I simply thought she’d gone off to live with sherpas, as she’s such a madcap gad-about. But she’s back, too, thank goodness)
What’s even more amazing is that the MSM trusts his opinion in the first place. He completely misses the housing crash and the credit debacle that he helped cause, yet he can see the bottom, while the folks who accurately predicted this mess still can’t???!?!!!
Puhleease…
I believe Greenspan and Kudlow are in a dead heat, ending right for their bottom. Those stinky fingers must be getting more stinky.
Don’t kill me for this, but Greenspan may be right, in a way. Early 2009 could well be a temporary bottom, but the key word is “stabilize.”
FB’s financies depend on appreciation. They would be sunk even if prices had stabilized even at 2006 levels. They are still waiting and hoping for prices to appreciate once they get rid of this pesky subprime meltdown. But we know now that: not only are prices NOT going to appreciate (FBs are sunk), and that prices are NOT going to stabilize at 2006 prices (FB’s are sunker), but that prices are going to stabilize at 40% haircuts. FB’s are going to be SO sunk they may as well drill for offshore oil while they’re down there.
By the time these geniuses figure that they are waiting for Godot, they will have maxed out the credit cards and the relatives reserves. And then prices will drop again to a lower minimum when the FB’s all walk.
Yup. I have heard this sort of warped logic several times. “The market is bad now, so I’ll just wait and try to sell in (6 months/a year/a few years from now)” I just can’t convince them that not only are prices going down, they’re not going to return to current prices any time soon. If you want to sell, you should price it to sell and sell before we see further price declines. People still think that this is a little hiccup and that future appreciation will soon make up for current declines.
There is talk of the yanking of the $500k tax-free house appreciation, in an effort to find taxes somewhere, anywhere?
This only effects people like my mom, who paid $48k for her house in el lay, 40 years ago.
“There is talk of the yanking of the $500k tax-free house appreciation, in an effort to find taxes somewhere, anywhere?”
That will never happen. The REIC is way to large and powerful in the lobbying effort to allow that. Look at California and its budget mess; the state won’t go after taxes incurred by short sales (it was never forgiven at the state level, just federal level) and they want to raise INCOME taxes in California to 11%, without any mention of raising property taxes. Taxing property at greater levels in California is a sure way to ruin re-election chances; there are so many people in this state who make little or no income yet live in $400K+ houses.
Actually they have already started yanking that exclusion.
I believe the new rule being implemented goes something like this. The exclusion will prorated on the use basis (these are my words as I don’t have the link handy). IOW, say you lived in a house for the requisite time for the full exclusion but moved out and turned it into a full time rental or second home and the usage looks like this: First 5 years it was second home, next 3 years primary residence, next 2 years it was a rental. Exclusion would be calculated as 3/10 X 500K (assuming married couple). The 3 is the amount of time of full time home divided by the length of time it was owned. This is assuming you meet the prior use test of 24 months out of the last 60 as a full time home. I think this was in the housing bill but I can’t remember where I read it so maybe not.
“..there are so many people in this state who make little or no income yet live in $400K+ houses.”
Yeah.
House fat, cash flow thin.
I have five family/friends in California in $700K+ houses (they all bought many years ago) who have low cash flow. Any politician who tries to monkey with the California property tax exemptions is toast. When I was a Golden Stater I got really peeved hearing the regular “save the underprivileged” mantra in conversation from people who I knew would turn apoplectic in a second if their tax dodges/trust funds/lifestyles were even remotely threatened. Easy to talk smack when you’ve got yours.
What auger-in said. But note that that only applies to capital gains of property that is PURCHASED after the implementation date of the law.
As a math calculation I provided here yesterday suggested, you can only have so many consecutive months of large percentage price declines before you reach ridiculously low prices, which clearly overshoot local market affordability thresholds to the low side. E.g., with 32 months of consecutive 7 pct price declines from now, April 2011 prices would drop by
((1-0.07)^32-1)*100 = -90 pct
from their current levels. Clearly that is not going to happen.
So in mathematical terms, we will soon see a decreases in the magnitude of the rate of decline, which might look like a bottoming out to some optimists.
However, it is worth bearing in mind that although the steepest period of decline in Japanese housing prices occurred in maybe the first five years of their long slide (1990-1994), home prices kept gradually deflating for at least fifteen years. But don’t worry, this is America, so it cannot happen here
This is true, but for now all support for the sky high bubble prices has been removed and what little support remains is rapidly being lost as lending standards continue to increase. I believe we will not see price support until we reach prices where sufficient number of people can again qualify for loans / down payments etc. Here in San Diego I hear prices are down to around a median of $450K right now, which obviously precludes any earners under $200K / yr from entering the market.
There is another X factor to consider. Unemployment is on the UP, and this too will start to feed the foreclosure market further driving down prices.
Face it the entire bubble price phenomenon was driven by fraud and ez no questions asked credit. The only way to keep prices high is to continue making these loan products available to all, and this obviously cannot continue.
Also remember that the declines are not evenly alotted across all markets, so, while the decline may slow down in areas that have already seen huge corrections, the areas that have thus far been “sticky” may still have their largest declines ahead of them, especially as the recession (worldwide as well as US) hits other areas of the economy, and the banks tighten lending further.
Exactly.
Places like Maryland, where entry level housing costs 5 times household income, and where houses at 10-times median household income for an area are not at all uncommon, have only come down 10% in prices.
We have a LONG way to go since it is not “different here” - people still need to be able to pay off the mortgage, and without toxic loans, that new reality will have a crushing effect on prices.
“Here in San Diego I hear prices are down to around a median of $450K right now, which obviously precludes any earners under $200K / yr from entering the market.”
This may be obvious to you and me, but not to the masses nor to top government economic policy makers. Without reinstating debaucherous mortgage lending practices, and against the backdrop of a record rate and magnitude of housing price decline, there is no support for these price levels. But sellers have not figured this out, yet…
The stupied, dumb, sellers will find out when there are no offers unless the market drops another 50%. It will and then the few buyers might be able to afford buying again.
On a similar note, what i find horrifying is the number of foreclosures/month.
It’s currently over 250, 000. Multiply that by 12, and assume an average of 3 people are affected per foreclosure (back of the envelope, conservative math here.) That’s 9 million people evicted this year - approximately 3% of the US population.
If that carries on for 2-3 more years…
what do i mean, if
“…prices could continue to drift lower through 2009 and beyond….”
Mr. Alan Greenspan
Aug 13, 2008
November 2002: “It’s hard to escape the conclusion that at some point our extraordinary housing boom…cannot continue indefinitely into the future.”
Mr. Alan Greenspan
His ideas of stability and mine are different. lol
http://online.wsj.com/article/SB121865515167837815.html?mod=hps_us_whats_news
Well, here’s a must read on the housing bill. It has numerous links to other related stories, etc. If you choose to read it be prepared for high blood pressure as it outlines a gov’t sanctioned looting operation that boggles the mind.
http://news.goldseek.com/GoldSeek/1218694140.php
The International Forecaster
(great article at their website)
“”The subprime monster won’t have completed its damage until the end of next June. ALT-A loans are in play to reset over the next three years. They are double the volume in dollars of subprimes. Now beginning for the next five years we have Option Arm pick-an-pay loans, whose dollar value is five times greater than subprime and ALT-A loans. $500 billion in ARMs will reset this year more than half of which will become foreclosures, far more than anticipated are simply walking away from their homes. The worst is ahead of us. Three to five years to the bottom and at least five years on the bottom after that. As we predicted bank losses will be over $2 trillion, plus in excess of $2 trillion in losses for Fannie and Freddie. Worse yet, interest rates are higher than a year ago and we forecast mortgage rates ½% higher by the end of the year.
What we have is systemic failure in our banking system; that is being drawn out as long as possible by the Fed, which is hoping for a miracle. All kinds of gimmicky is being employed by the Fed, banks, Wall Street and corporate America. As we said banks alone are looking at $2 trillion in losses. It is not only American banks that are in trouble. The ECB banks took down 40% of the toxic CDOs and SIVs. Housing markets in Spain, Ireland, England, Italy, Australia and New Zealand will take trillions in losses. The amount of money in US banks that is uninsured is more than $2 trillion. America will hit the wall some time within the next three years and when it does there will be no banking system left and what will be in the banks will be worth 50% or more less than it is today due to inflation.”"
Thanks for that uplifting forecast, wjk…
I shoulda just stuck to sports and Paris Hilton’s latest exploits this morning.
another uplifting forecast on ‘The Market Ticker’ website
“”95% of America has no idea what’s coming. That’s because they don’t listen to the credit and FX markets.
This is just one (of many) examples. It is the “AA” rated “slice” of an index, specifically, the “Home Equity Credit” ABX index which is on, effectively, swaps on asset-backed paper. As the name implies, this is Home Equity loans, the “AA”, or one step down from the top (AAA) rated debt. Notice where its trading? 10 cents. The “AAA” slice is trading at about 50, by the way, and the “A” and “BBB” is in even worse shape. That’s nasty.
Now for the guy who wants to put one of these deals together, realize that the “BBB” piece is just that piece that gets “sliced off.” His “composite” cost is probably somewhere around 10%; figure the swap is around 5ish, and then the “blended” spread on all the components once you do your magic winds up at around 500 over that. That’s bad. In fact its real bad; you have to be able to cash flow at that same 10% (of the gross on the deal) to break even, and of course nobody works for free. For all intents and purposes this marks that part of the market as “done”, as in “baked”, “well”, or more likely, “crispy.”
Folks, this isn’t bad, its a full-on meltdown, China Syndrome style. The happy-face folks on BubbleVision are not talking about it, but this does not mean it is not happening.””
Don’t worry - I am sure hyperinflation will “fix” everything.
Well the real problem is that those ratings aren’t worth that much. That is to say that some A bonds will be okay while other AA bonds will be toast. The mathematical models that they tested them under never anticipated widespread national declines of the type that we’re seeing. Lets face it the losses are likely to extend far up the ratings chain for bonds built on second mortgages in CA of FL. But even lower tranches of older bonds made from 30 year fixed firsts are likely to continue to have returns.
Pondering the Mess, “Don’t worry - I am sure hyperinflation will “fix” everything.”
15% mortgage interest rates here we come.
That will ‘fix’ the housing market good!
Best Wishes.
RE: 15% mortgage interest rates here we come.
Been there done that…it’s a bitch!
wjk:
What we have is systemic failure in our banking system
yep
On yesterday’s California thread, Ben quoted an article from the Fresno Bee.
“A new threat is emerging that could keep the tidal wave of foreclosures continuing into 2011, experts say. More interest-only and so-called option adjustable-rate mortgages handed out during the real-estate boom are starting to go bad as home values continue to fall. These loans also are called alternative-documentation loans, or Alt-A.” . . .
NEW threat??? EMERGING???
(* ozajh does his best to impersonate the attitude of a sleeping grizzly bear suddenly awoken by a poke with a sharp stick *)
Seems to me us HBB folks have been yelling from the rooftops about Alt-A for quite some time now. Several years, in fact.
HA Ozajh! Not according to Greenspeak!
Greenspan sees house price bottom in 2009: report
Snips…
NEW YORK/BANGALORE (Reuters) - Former Federal Reserve Chairman Alan Greenspan predicts U.S. house prices will begin to stabilize in the first half of next year, even as he faulted the government’s rescue of mortgage market giants Fannie Mae and Freddie Mac, the Wall Street Journal reported on Thursday…
Greenspan also offered a novel suggestion to bolster the housing market — increase the number of potential home buyers by admitting more skilled immigrants…
“Home prices in the U.S. are likely to start to stabilize or touch bottom sometime in the first half of 2009,” he said.
But Greenspan cautioned that even at a bottom “prices could continue to drift lower through 2009 and beyond.”…
In the past, Greenspan’s crystal ball has been, at best, cloudy, the Wall Street Journal noted. He didn’t foresee the sharp national decline in home prices. But recently released transcripts of Fed meetings do record him warning in November 2002: “It’s hard to escape the conclusion that at some point our extraordinary housing boom…cannot continue indefinitely into the future.”…
Do the hokey pokey and turn yourself around.
That’s what it’s all about!
Ya just can’t make this stuff up!
Leigh
Ooooops…link
http://www.reuters.com/article/businessNews/idUSN1350807020080814?sp=true
I’m still reading “Greenspan’s Fraud”. His record is one of flip-flopping and taking pragmatic positions that would increase his influence and power. The book is not the best ever but it is enlightening. I wouldn’t trust this guy any further than I can throw a Volkswagon.
“We’ve reached a bottom, even though prices will continue to fall.” NYCityBoy scratches his head and lets out the world’s biggest fart.
Not. Even. Fair!
Need more cof..f..eee…
Eyes leaking…inny belly button popping out laughter.
STOP!
Leigh
damn nyc boy heard that one all the way up here on 24th street
what did you eat last night?
Greenspan stew.
I said STOP.
Leigh
As soon as I saw NYCityBoy name, I put my coffee down and then read his posting.
Interestingly, Greenspan supports dismantling Fannie and Freddie. I have no problem with that: Banks need to hold onto their own paper.
“…Greenspan predicts U.S. house prices wil begin to stabilize in the first half of next year…”
Greenspan is our friend, so is the NAR, so is everyone who can encourage knifecatchers to commit their money to our cash-starved system and can convince FBs that they should hang on to their over-priced houses rather than walk.
This is not a popular position to hold on this blog but it is true nevertheless.
Think about it.
Popular or not, I’ve felt the same way for some time.
In the end, we are still going to need a functioning economy.
Yes but sometimes the best path to health is to hit rock bottom first. In this case to get to a properly-functioning economy we may first need to go through a period of complete dysfunction.
(P.S. why is dysfunction not spelled disfunction? You don’t “dysconnect” something. People who aren’t able are not “dysabled”. I never understood that. English is such a disfunctional language.)
(P.P.S. I have little confidence that even if we do go through a period of dysfunction that we’ll come out with a healthy economy, or a healthy political system, on the other side. However I believe that such dysfunction is probably the only path to such health, so I say bring it on.)
I expect dysfunction, and I don’t expect anything good to come out of it.
As for buying a house, the best time to buy is when the Powers That Be do NOT want you to buy. So, we have a ways to go yet.
Deceitful liars are nobody’s best friend.
Think about it.
I agree. That “Greenspan is our friend” line is just nonsense. What guarantees do we have that these aren’t just more bad loans that will be bailed out later? You don’t return to common sense by spewing a bunch of nonsense. The NAR and Greenspan might be your friends but they sure aren’t mine.
Who needs a guarantee?
I’m not saying that Greenspan or the NAR are right - just that if they shut up, who the hell is going to buy even one house in this country? It’s obvious both of them are full of shit, that you and I know. Especially Greenspan’s line about housing drifting around and going lower… so is the bottom in 2009 or much later? And they both can’t wrap their heads around the fact that we are not going to return to the mean in any sustainable fashion without blowing right past the mean on the downside.
Perhaps in much of an economy that has evolved to one of trading houses and managing money, for economic survival we still need some people willing to commit (and lose) a lot of money!
Wait a minute, isn’t a deceitful liar someone who tells the truth?!
Only in Greenspan-ese.
“Greenspan is our friend”
More like: “Greenspan is our fiend”
who the hell is going to buy even one house in this country
When prices are right, I will.
My Dad, a long-time RE investor, bought a condo yesterday in Colorado Springs, CO. The complex was built in 2005, half the units are in foreclosure after a California investor went bust. The unit sold in 2005 for $240,000. My pops picked it up for $83,000 cash. There were higher non-cash offers.
Rents for $1300/mon, HOA is $150/mon. He should be getting at least a 10% yearly return on his money.
Not bad.
I told him to pick one up for me if he can get it for under $70k.
No housing bubble in Colorado? Right.
mkl42,
If 50% of the condo units are in foreclosure, the building is gonna get hit with a HUGE special HOA charges to cover the non-payers, which could amount to tens of thousands by the time you are done.
Did your dad take that into consideration when he purchased it?
I mentioned that to him too, and he had already researched that side of it. He’s been in the game for 40 years, and this is his first purchase during this downturn. He wasn’t liquid during the Colorado real estate crash in the 1980s, and he’s not making that mistake again. I remember as a kid hearing him mutter “oh, to be liquid, oh to be liquid…”
A 66% haircut over three years. There were five competing offers for this unit, and they took the lowest — because it was all-cash.
$1300/mo for a condo in Colorado seems pricy. I only pay a little more for my apartment in the CA SF Bay area. Especially one with that many units in foreclosure. I wouldn’t want to rent in an environment like that.
Hope it works out for your dad.
I agree with Alan a little bit. Home prices are beginning to stabilize here in Cleveland. Houses that were selling for 100K five years ago have now stabilized in the $1-$1,000 range. Granted, it is the combat zone of Cleveland and the house is stripped of everything, but how much more lower can it go?
but how much more lower can it go? When the city pays bulldozer & front end loader operators to strip houses off lots to create greenspace, that’s how much lower it can go.
“but how much more lower can it go? ”
…See yesterdays article of the $1 Detroit house. We can go a lot lower..It only looks cheaper by looking behind you at yesterdays prices. If you risk your life ,and belongings by living in a ‘cheap’ place…it is too expensive.
“increase the number of potential home buyers by admitting more skilled immigrants…”
oh yea, lets bring in more immigrants to compete in a shrinking job market! i’m sure that will workout just fine!
Greenspan is a “former” self-styled Objectivist and colleague of Ayn Rand(though no one is sure if he actually bumped uglies with Rand-who was famous for her open marriage and voracious sexual appetite). His dark clothing and somber demeanor earned him the nickname “the Undertaker” in her inner circle.
shudder…The nickname was prescient, wasn’t it?
Rand preached the ‘virtue of self’, stating that the real producers of the economy were constantly at war with leeches who earned money by government exploitation of the free market. She was a magnet for anti-communists, self-congratulatory capitalists and anarchists. These people, she argued, could be trusted to police themselves and always ‘produce’.
After nearly a quarter century of defending the worst excesses of Wall Street on a taxpayer subsidized salary, Greenspan has become analogous to one of the villains of “Atlas Shrugged”, Dr. Robert Stadler:
“…one of the villains of Rand’s second major novel, Atlas Shrugged. He’s a J. Robert Oppenheimer archetype — the aristocratic scientist who sells his soul to the state, and ends up getting destroyed by the state. Stadler was a brilliant and famous physicist — and the mentor of Rand’s ultimate hero John Galt…Obsessed with the importance of his own genius and contemptuous of lesser men, Stadler was unwilling to work in the competitive environment of private universities or private business. So he obtained public funding to create the State Science Institute — where he could work without competition or standards, subsidized by the taxpayers.”
http://www.poorandstupid.com/2003_02_16_chronArchive.asp#90329423
How about some contrast?
‘After six months of falling prices, a rising tide of repossessions and the prospect of millions of families slipping into negative equity, the Governor of the Bank of England, Mervyn King, said yesterday that there was little the authorities could do to prevent a housing crash, if that is what the market demanded.’
‘During a press conference to launch the bank’s Inflation Report, Mr King said: “It’s hard to judge where prices may go… We are in a period where prices are adjusting to new levels. Buyers and sellers are struggling to find out what that new level is. The market will determine it, not us or the Government. Once we have reached that level then prices should normalise. But that does not mean back to levels seen early last year that were clearly excessive.”
‘His remarks stand in stark contrast to ministers who say they are searching for ways to “rescue” the housing market, most notably through measures such as a “holiday” for stamp duty and an extension of the Bank of England’s special liquidity scheme.’
Isn’t Mervyn King the guy that said there would be no rescue for Northern Rock and then bailed them out a week later?
Can we trade Hanky Panky and Helicopter Ben for Mervyn? I was beginning to think being a complete tool was a prerequisite for being a cabinet-level economist.
The market will determine it.
HBB motto.
Leigh
The longer the powers that be wait to tell the truth about what’s going on, the larger the likelihood of social unrest, as this pressure cooker is going to blow up in their faces, all at once, sooner than later.
My little sister finally sold her house in Manchester, England after about 1 year and 3 buyers that couldn’t obtain financing.
She is now happily renting, and totally fine with a housing crash. Given her luck, England will pull a Mervyn and bail everyone out.
Let MORE immigrants come into this country?
What? What the heck is this vampire drinking?
OKeydokey, we already have far fewer jobs to choose from, so are these newly invited immigrants going to have the leftover good jobs?
Does anyone remember the news reports from the August 2007 credit meltdown?
There was no panic when subprime began melting down once the Spring 2007 selling season failed. I guess the secondary market already knew subprime was toast, and figured they could use their Primes and Alt-A paper to swallow the risk. The market got sacred later in August, ONLY when it became apparent that Alt-A was in trouble.
There was brief mention of troubles with Alt-A at the time, but the news media quickly hushed up Alt-A in favor of covering the subprime. After all, they couldn’t spread the panic. And anyway, the subprime bloodbath was more newsworthy. That’s where where the single mothers and young couples longing for the “American Dream” hung out.
Oh, gosh, I mean the market got SCARED in August, no sacred. (although they probably think markets are sacred… … …that is, until it goes downhill at which point they go crying to Papa Ben.)
Yep, not a NEW threat. The threat dates to when the loans were WRITTEN. Because writing the loans in the first place was the problem. It just took the majority of people a while to realize it.
U.S. Foreclosures Increase 55%, Bank Seizures Rise to Record
http://tinyurl.com/5b2o2q
It would be nice to compare the foreclosure _rate_ with the pre-bubble foreclosure rate. First, they emphasize absolute numbers, which will rise with population even if everything else stays constant. And second, I have no perspective. Is one household in 500 a high foreclosure rate? Or, is it normal?
And in local news (Mount Sinai, Long Island, New York), there is a new foreclosure on my way to work. There used to be two foreclosures for sale. Then one was sold to a flipper. It got a new coat of paint and a for sale sign.
Now there is a new abandoned looking house with a for sale sign. It is right next to the other abandoned looking house with a for sale sign. And, they are across the street from the abandoned looking house with no for sale sign (so I don’t count that yet).
Foreclosure asking prices are still too high for local incomes and local rents.
PS Does one write “for sale sign” or “for-sale sign” (with a hyphen)?
I couldn’t believe it when on the local 11:00 news they did a piece about local foreclosures. The piece opened by stating “Foreclosure filings are exploding in Onondaga Cty and the outlying areas. In fact, the suburbs are outpacing the city.” Later it was stated “Onondaga County is starting to catch up with the rest of the country.”
http://www.9wsyr.com/mediacenter/local.aspx
In the Top Stories Box, click Onondaga Suburbs Experience More Foreclosures 8/13/08
You might also notice the story about metal theft in the area too.
It blows me away that the supposed key to solving the “housing crisis” is government legislation, convincing consumers to take on more debt, and taxpayer bailouts of the financial sector. The “homeowner” is being portrayed as the victim of circumstances beyond their control.
The 800lb gorilla in the room that everyone is tiptoeing around is the greed of homesellers, who bemoan the fact that their Ponzi schems have run out of Greater Fools…instead of admitting they made a mistake and overpaid or oversold an asset class that fundamentally produces nothing except the illusion of wealth and prosperity.
Month-over-Month vs Year-over-Year.
YOY certainly paints a different picture than MOM!
Darn Statistics!
Home foreclosure filings up 55 percent in July
NEW YORK (Reuters) - U.S. foreclosure activity in July rose 55 percent from a year earlier as a slump in once-sizzling housing markets forced yet more borrowers to default on their mortgages, according to a monthly report.
Foreclosure filings — default notices, auction sale notices and bank repossessions — rose 8 percent from June and 55 percent from July 2007 to 272,171, according to RealtyTrac, which records property in various stages of foreclosure…(cont’d)
http://www.reuters.com/article/bondsNews/idUSN1338505720080814?sp=true
I love math. It’s clean, reliable, and fun.
For the love of mother, stop manipulating it (math).
Grrrrrr……
Leigh
If you annualize 272,000 forclosures a month, that’s 3.2m a year.
Note also that the much vaunted “bailout” bill - even if it worked exactly as intended - would “help” less than 2 mos. worth of foreclosures.
I still maintain they blow half the loot just staffing up.
I vote Asparagus and edgewaterjohn for Sec of Treasury and Fed Chairman (fight it out).
Leigh
Yeah Government workers find it Impossible to do any work without those $1000 Herman miller Aeron chairs
http://www.amazon.com/gp/product/B000NTESJ2
Dude–we picked up all our Miller’s during the dot-com bust for next to nothing. Saved money versus regular crappy office chairs and lowered medical bills and cut time out of the office. You should support efficient use of your tax dollars.
Check this out Classic Gunlocke Chairs….i am sitting on one i got years ago from a lawyers office….these are $2000+ each…..notice the 4 wheel base….those big bases are goo for big people….plus the back is not connected to the seat so it doesn’t tip over…
http://www.gunlocke.com/MyGunlockeChair/NewViewStory.cfm?StoryID=8&start=1
i do not think the heavy stuff will be down for quite awhile!
blil murray- caddyshack
US foreclosure filings surge 55 percent
http://biz.yahoo.com/ap/080814/foreclosure_rates.html
Nationwide, more than 272,000 homes received at least one foreclosure-related notice in July, up 55 percent from about 175,000 in the same month last year and up 8 percent from June, RealtyTrac Inc. said. That means one in every 464 U.S. households received a foreclosure filing last month.
To speed up the disposition of the 54,000 foreclosed properties it owns, Fannie Mae is opening offices in California and Florida and is considering selling those properties in bulk to investors. “I do not think this is a time to be holding onto (foreclosed properties) hoping for a better day,” CEO Daniel Mudd said last week.
The numbers continue to get uglier and the bottom callers keep looking at early 2009 as a turnaround. But I thought all this housing help was supposed to help the indiviual homeowner not the speculative invesotor.
As in Iraq, the surge appears to be working…
Arithmetic for everyone!
Asian Stocks Drop for a Third Day, Led by Developers; BHP Gains
By Chen Shiyin and Shani Raja
Snips…
Aug. 14 (Bloomberg) — Asian stocks fell, led by financial companies, after developer Urban Corp. filed for bankruptcy and Merrill Lynch & Co. said the credit crisis is far from over. Commodity producers gained after oil and metal prices rose…
“The macro environment looks like it’s worsening,” said Jason Teh, who helps manage about $5.7 billion at Investors Mutual Ltd. in Sydney. “You’ve got Europe slowing, Japan slowing, and a question mark over China. Something has to give.”…
Merrill’s chief strategist Richard Bernstein said yesterday buying bank shares is risky as “the problems in the financial sector appear to us to be far from over.” The credit crisis is not limited to U.S. banks with subprime loan-related securities, he added in a note to clients…(Ya think)?
Sigh,
Leigh
http://www.bloomberg.com/apps/news?pid=20601080&sid=aL_lVg7EEx_M&refer=asia
So, did anyone notice an article in NYT or was it the WSJ International recently that stated many of the wall street people were being sent to S. Am or Asia to staff the “growth” there. As in previous years, they stayed in NYC where the action was, now it seems that a big % is being relocated.
McMansion owner hall of shame for this lady. I’m sure the picture will bring out the sympathy from the HBB’ers (sarcasm off)
http://www.thestar.com/News/GTA/article/477380
August 13, 2008
CAROLA VYHNAK
URBAN AFFAIRS REPORTER
Every weekday morning Sandra Cassidy wakes up to the sound of the bus carrying her neighbours to work and school.
“It just comes roaring down the road. We can’t open our windows because of the smell and noise,” says the Ajax homeowner.
Over the objections of residents who rely on the service, Cassidy is lobbying Durham Region Transit to reroute the bus so it doesn’t go past her grey stone house on Audley Rd. S.
“We paid a lot of money to have the only custom-built home in a very special subdivision.” That included a $100,000 premium to look out over Lake Ontario. “I can’t even hear the TV when a bus goes by,” she adds, complaining the service was “dumped on us” without warning two years ago.
Her husband Wayne, a “well-respected” architectural technologist who designed the subdivision, has some clout with local politicians who know him through business and charity events, Cassidy says.
“Not to sound like I’m bragging or anything but we have more (influence) than the average person.”
Her proposal to eliminate a two-kilometre loop has transit riders fuming. Some would have a longer walk to the bus stop, which they say poses a safety hazard in the winter. Those who live on the existing route dispute claims of excessive noise. And they argue a route change would discourage users who are trying to drive their cars less because of high gas prices and environmental concerns.
“I’m acutely aware of pollution and we’re trying to limit our carbon footprint as much as possible,” says Dan Dascalescu, whose wife and daughter also use the bus during their daily commute to Toronto.
If a shortcut is implemented, they’ll be 600 or 700 metres from a bus stop and might be forced to drive in the winter because snow, ice and howling winds make it “unsafe to walk.”
Route 222 was added as part of Durham Region’s mandate to provide service within 400 metres of customers. The bus runs every half-hour during morning and afternoon rush hours, linking the subdivision with the GO station 10 kilometres away.
Cassidy believes the bus poses a safety hazard rounding the narrow corner where her house sits. It’s also “mostly empty,” says Cassidy, who got 75 residents around the perimeter of the loop to sign a petition to reroute the bus.
“I’m sure there are a few elderly people who want it” but everyone in the area has at least two cars, says the mother of four grown children who have left home.
Carol Weese, who has a bad hip and bought her house because of the bus service, waits to see it come down the street before going out to the stop.
“Winter is the worst concern,” she says. “The sidewalks become really treacherous.” If the route changed, Weese says she’d have to wait up to 10 or 15 minutes in the cold because the bus is sometimes late.
Phil Meagher, DRT’s deputy general manager of operations, calls Route 222 a “good performer,” averaging 34 riders per hour, compared to the standard of seven to 28.
Dismissing Cassidy’s safety concern, he also says the bus creates little pollution and is no more noisy than garbage trucks and school buses.
“It’s there to provide service to taxpayers,” says Meagher, noting the Cassidys have been calling and emailing local politicians since spring.
The transit commission’s executive committee will consider the matter at a meeting Sept. 3.
This sounds just like a Marin County NIMBY kind of thing.
I was not aware that California-style housing narcissism had made it all the way to the Toronto area.
And yeah, let’s just forget the elderly.
“‘I’m sure there are a few elderly people who want it’ but everyone in the area has at least two cars, says the mother of four grown children who have left home.”
I suspect a few of those “elderly” persons have sons and daughters, cousins and friends of friends with a little more pull than an “architectural technologist”.
The “architectural technologist”!!!
Design a home with proper noise barriers you freak of nature!!!
Unbelievable.
Leigh
I think she should blame the person that designed the subdivision so poorly that a bus route causes such a disturbance.
Oh wait, that’s her husband? Nevermind, blame the bus!
Arc Tech? This is a new one. I suppose he’s a “professional” too. And he “designed” the ScabDivision too… right. He’s a friggin CAD operator in a cube farm who couldn’t build a doghouse in 6 months and this guy has clout? FAAAAAAAAAAAWK U, your pruned faced hag of wife and your creepy haunted house of a monstrosity. I hope you choke on diesel fumes ya jerk.
I s’pose the school bus only goes round 2 x per day and a garbage truck, 1x per week, so why can’t they just keep the bus service, but have it run less frequently, oh, say 1 x per hr during rush hr? IF you needed to get somewhere by bus, IMHO, get there a tad early.
I am not defending the person who wants the service cut, but hows about just a tad less frequently.
Deal done.
Super mediator to the rescue.
Yeah, and it was a custom “stone” house also. Perhaps double pane windows will help
If she was so uppercrust why did she need to chose a lot where her neighbors needed bus service?
Face it Sandra Cassidy, you’re not as special as you imagine.
Yes, but she is above average.
“Not to sound like I’m bragging or anything but we have more (influence) than the average person.”
lol- what an wannabe elistist skank
enjoy the fumes and your 100k view of lake whatever
if she rented she could move but we all know renting is just throwing money away
I hate to break it to her but people pay more than $100k premiums for Finger Lake lots such as Caz, Skaneateles. I dunno. Maybe it’s something about the lack of bus routes in these towns. She really does need to get over herself.
I like your anger!
i think she blew her chances of getting that bus re-routed with that one comment.
AMEN taking bets!
‘I am Somebody Special. ‘
You are all forewarned.
If it matters, the article says the route was added after they were living there.
Anyway, it seems to me that when you live next to people you get noise. If you want no (or minimal) noise, buy a big piece of land somewhere and live in the middle of it.
It matters. Until this… “Not to sound like I’m bragging or anything but we have more (influence) than the average person.”
I’ll bet her husband has a young thang on the side.
Yeah, that comment really caught my attention too.
Husband on the day the article comes out: “Don’t you know when to keep your mouth shut?”
The more noise, the more uncivil the behavior, unless of course boom cars, no-pipe harleys, obsessive lawn jockeys and incessant barking dogs are considered civil behavior.
This is interesting if you have the time to listen:
The Noisy Ape
But in the last century alone the lower threshold of human hearing has gone up by four decibels. This may not look much until you realise that this means a 66% deterioration in hearing quiet sounds!
http://www.bbc.co.uk/worldservice/specials/129_noisy_ape/index.shtml
Based upon what i’ve seen…
The more money you make, the louder you are.
In Europe, i’ve found Germans to be the most audible on the continent.
In Europe, i’ve found Germans to be the most audible on the continent.
I did not find the German attendees at the 65th Battle of Britain Aniversary airshow at IWM Duxford UK to be very boisterous.
In fact they were rather subdued during the “Parade of the Spitfires”.
WTF is an architectural technologist? Is that one of those two-year associate’s degrees in drafting?
Anyway, if she was worried about noise, why did she buy a house that was 10ft from the street?
“We paid a lot of money to have the only custom-built home in a very special subdivision.” That included a $100,000 premium to look out over Lake Ontario. “I can’t even hear the TV when a bus goes by,” she adds, complaining the service was “dumped on us” without warning two years ago.”
Advice: Turn off your TV. It will help you in many ways. We are in an energy crisis that will last at least the next 10-15 years. Your way of life is finished. Get over it and get used to listening to (and riding) buses.
“Her husband Wayne, a “well-respected” architectural technologist who designed the subdivision, has some clout with local politicians who know him through business and charity events, Cassidy says.”
“Not to sound like I’m bragging or anything but we have more (influence) than the average person.”
Sorry, but the “influence” of subdivision designers/architects, etc. is going down fast. That sounds like a job as endangered as “mortgage broker”. God, what a self-righteous bit**! I wonder what she will say when gas rationing arrives in 18-24 months.
The bus runs every half-hour during morning and afternoon rush hours, linking the subdivision with the GO station 10 kilometres away.
Sandra needs to realize that the bus and the GO station are her salvation.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a5CAldf0hhyo&refer=home
Aug. 14 (Bloomberg) — Asian stocks fell, led by financial companies, after developer Urban Corp. filed for bankruptcy and Merrill Lynch & Co. said the credit crisis is far from over. Commodity producers gained after oil and metal prices rose.
“The macro environment looks like it’s worsening,” said Jason Teh, who helps manage about $5.7 billion at Investors Mutual Ltd. in Sydney. “You’ve got Europe slowing, Japan slowing, and a question mark over China. Something has to give.”
Sounds like the US has successfully exported our implosion model. Now we’ve only got to wait till that something to give. What will that something be?
2007: The Funds of August
2008: The Runs of August?
Eight minutes until the CPI comes out. I’m guessing it comes in at .3% and causes a sharp rally on Wall Street as Bernanke’s WIN Campaign (Whip Inflation Now) has proven to be so successful.
Speaking of that epic book, I insisted that Marge read it two weeks ago. She is simply awestruck.
For those who can look past the book’s thorough martial details, it’s true value is how it clearly shows that the PTB - A. does not know what the f&#% it is doing and B. is hardly omnipotent or omniscient. Never has been and never will be.
“The Guns of August” Babara Tuchmann - for those that think it’s all under control.
It’s a masterpiece of tangled webs of alliances, oftentimes the result of shotgun marriages, metaphorically speaking…
In other words, not much different to today’s goings on, but replace World War 1, with an economic war.
Dang, I want my mommy.
I need a hug. (Hubby still sleeping - I think I’ll slink back in bed with him)!
Leigh
“Anyone get the feeling that the banking and credit crisis is about to get worse?”
Easily more than 1,000 days late and billions (a trillion?) dollars short, it has to be said that there’s a lot more than the books of Wall Street that stink.
How about the leadership and many of the minions?
*****
DAVID WEIDNER’S WRITING ON THE WALL
Whoops, there goes our profit
Commentary: Merrill and J.P. Morgan hint at the scale of coming damage
By David Weidner, MarketWatch
Last update: 12:01 a.m. EDT Aug. 14, 2008
“Anyone get the feeling that the banking and credit crisis is about to get worse? We may be waiting a lot longer than the third quarter for the bleeding to stop.
J.P. Morgan seems to be taking one of the two strategies that have emerged during the crisis: hold onto the junk and hope the market turns. This is the same plan that’s in place at Lehman Brothers Holdings Inc. (LEH:Lehman Brothers Holdings Inc) and was in place at Bear Stearns Cos.
There’s a technical term for the other strategy that’s being employed at Merrill Lynch & Co. (MER:Merrill Lynch & Co., Inc): dump it.
Merrill employed this strategy back on July 29 when it took a healthy haircut and accepted 22 cents on the dollar for about $30 billion in collateralized debt obligations that were stinking up the balance sheet. About the only good news the market took from this was that there was actually someone willing to buy it.
The point is that even though there are different strategies, there is a single truth: the books on Wall Street are still loaded with stuff that stinks.”
http://www.marketwatch.com/news/story/jp-morgan-disappearing-profit/story.aspx?guid=%7BA1F91885%2DA9A0%2D493C%2D98A1%2D96331E81652D%7D
“About the only good news the market took from this was there was actually somebody willing to buy it.”
“… there was actually someone willing to buy it.”
This makes Merrill the smartest of the bunch in that they sold while there were still buyers to be found and thus they were able to take their losses. The rest remain screwed.
Not really, no-one was willing to buy it. The “buyer” was financed by ML. The buyer essentially purchased all the possible upside and bought a tight Put on the downside. Very smart.
But not a third party arms length sale by any means. ML were totally outmanouvered by much smarter people.
My prediction: These CDO’s will be back on ML’s books before July ‘09.
What possible incentive could the big boys have to find a bottom for that garbage? Isn’t the lack of tranparency the only thing keeping the market afloat right now?
it is merely a flesh wound
Didn’t he hear? Financials have bottomed!!! Buy financials now or be priced out forever!!!
Financial Stocks Have Bottomed, Meredith Whitney Wrong
http://finance.yahoo.com/tech-ticker/article/48212/Financial-Stocks-Have-Bottomed-says-Bullish-Fund-Manager?tickers=ubs,bac,jpm,gs,wb,c,leh
Greenspan sees house price bottom in 2009: report
http://www.reuters.com/article/businessNews/idUSN1350807020080814
Former Federal Reserve Chairman Alan Greenspan predicts U.S. house prices will begin to stabilize in the first half of next year, even as he faulted the government’s rescue of mortgage market giants Fannie Mae and Freddie Mac, the Wall Street Journal reported on Thursday.
The all-is-well in 2009 song keeps playing.
I was under the impression that we paid off Judas Beast in the form of 30 pieces of Silver and 15 minutes of Fame.
The Obfuscating Octogenarian has outworn his welcome…
And from MSNBC’s Greenspan article http://www.msnbc.msn.com/id/26185570/:
But Greenspan cautioned that even at a bottom “prices could continue to drift lower through 2009 and beyond.”
Um, if prices continue to drift lower, doesn’t that mean a bottom hasn’t been reached?… Master of the doublespeak.
Have any of you ever boarded a commercial airliner with deep caution, thinking “I hope the oxygen system doesn’t fail, and asphyxiate all of us” ?
I never worried 1 iota about it, and you haven’t either, probably…
The reason for lack of concern on our part, is that there are 4 oxygen systems, independent of one-another. The main system and 3 failsafe systems, in back-up mode.
Are you failsafe, financially?
No one is failsafe financially. Apparently not even the US government deserves its AAA rating. Instead of learning from the mistakes of Japan, we seem doomed to repeat them.
I have a rabbit’s foot, rosary, lucky horseshoe and a pocket full of lottery tickets. I am financially diversified. If that fails, the government will save me. Now, don’t you feel silly, Goldmember?
I always carry my “lucky anvil”
…Water, 6 months of food, generator, protection?
….wasn’t discussed much on yesterdays thread , but with the pullback on PM’s prices…there is a shortage of a lot of popular products..Eagles etc.? Hedgies are dumping paper options,but someone is accumulating a lot of physical.
The oxygen on board an airliner comes from one of the compressor stages of the engine (outside air) and after being routed through an aircycle machine to control temperature/pressure it enters the cabin. The outflow valve, usually located in the tail fuselage, controls the rate of discharge of air out of the cabin thus allowing a constant pressure differential between outside altitude and inside the cabin. Contrary to what most folks think, on climbout the cabin altitude climbs while being pressurized. IE, if the plane is at 35,000 ft, the cabin is at 8,000 ft or so depending on the pressure differential selected on the cabin controller. The inflow of outside air via the engines is done automatically by a combination of the compressor stage valves, aircycle machine & the cabin controller but this cabin altitude change is why you often feel your ears pop on climbout or descent, the cabin is adjusting to the altitude called for by the cabin controller set by the pilot and it’s set schedule of climb/descent (usually cabin climbs at 500 fpm and descends at 300fpm but can be changed manually by pilot).
Should all the engines stop or a hole gets blown open in the fuselage, the outflow valve would automatically slam shut trying to trap the air inside the cabin (to no avail because the fuselage is not airtight) and the oxygen masks would drop as soon as the cabin altitude climbed above approximately 10,000ft (this system is redundant with two separate controllers which self check). Aircraft used to have big O2 tanks in the belly but now most have oxygen generators. Usually there is one per row of seats or so. When the masks fall (automatically with a manual back up in cockpit and one in main cabin, which may be what Alad is referring too) and then are pulled on, it activates the generators which is a chemical reaction inside a bottle (which gets very hot). Anyway, this supplies O2 for about 13 minutes, enough for an emergency descent to below 10,000 ft (for hypoxia issues). Just wanted to clear up that all the air comes from outside unless you need supplemental O2 because cabin altitude is above 10,000ft.
EU: Euro economy shrinks in second quarter, Germany, Spain, Italy see contraction
http://biz.yahoo.com/ap/080814/europe_economy.html
i wonder if the realtors still think these people will come and buy-up all the excess houses here?
The July Consumer Price Index (CPI) climbed 5.6% year-over-year, though economists forecast a 5.1% increase. It was also more than the 5.0% increase registered in June. Excluding food and energy, July CPI increased 2.5%, which is more than the consensus 2.4% advance and up from the 2.4% increase the month before. Month-over-month, the index increased 0.8%, which is above the 0.4% increase economists came to expect yet below the 1.1% increase registered in June. The month-over-month increase totaled 0.3% after excluding food and energy, which is above the 0.2% increase that was widely expected and even with the increase for the preceding month. Separately, jobless claims for the week ending August 9 totaled 450,000. Economists expected 435,000 claims following the upwardly revised 460,000 claims filed for the previous week.
will walmart save the day???????
Once again my money market account leaves me hanging. Time to cut more expenses to make up for the loss of spending power.
Continuing jobless claims starting to skyrocket, not good at all -
http://www.bloomberg.com/apps/cbuilder?ticker1=INJCSP:IND
(check out the 5-year)
I think we may hit 6% in the next monthly unemployment number. That seems to be a big “uh oh” threshold. FYI the last recession (2001) peaked at 6.3% in 2003 - though that was actually a year after the recession officially ended. During the recession itself unemployment went from 4.2% to 5.7%. Well, we’re already there this time.
Next stop - 1991 recession (peaked at 7.8%)
Then - 1982 recession (peaked at 10.8%)
And lastly the coup-de-gras - 1933 GD (estimated at 25%)
Not that we’ll hit all those. Just some milestones to watch for. My guess would be we’ll end up somewhere in the 10-12% range.
And most importantly, it’s a lagging indicator. Main St. needs to remember this trifling little point. Prosperity, as Main St. knows it, won’t return quickly.
10-12% really? Remember the undocumented aliens don’t get unemployment. So the unemployment number will be less IMO.
If we calculated unemployment the way it is calculated in Sweden we are already over 13%.
Is the “real” US unemployment rate 13 percent
by J Schmitt
http://www.cepr.net/documents/publications/sweden_unemployment_2007_06.pdf
….also, how many 1099 self employed? It was was the talk of the town 2 years ago how many were self-employed. I know many people out looking now that Ebay, and construction is dead…
Bush is the GREATEST pres we ever had in creating Underground Jobs
must give him credit when its due!
Realtors and the other self employed don’t get unemployment either, I think. Nor will master of the universe house flipper types like Casey Serin.
RE: Remember the undocumented aliens don’t get unemployment.
Neither do the self-employed which is the designated status of the majority of people employed in the real estate industry and to a lesser extent the origination game.
With 40% of the US job creation over the last 5 years, being real estate related the reported unemployment numbers are completely bogus.
“will walmart save the day???????”
to answer my own question, it has so far!
DJ30 +38.04 NASDAQ +9.34 SP500 +2.24
‘It’s a sluggish economy, and its difficulties are felt all over,” said Joseph DiRenzo, a married 38-year-old father of three who left a hedge fund two years ago to enter commercial real estate. DiRenzo says he’s feeling the hit in many places, especially in the value of his house on Long Island’s upscale Gold Coast in Muttontown, N.Y.’
‘He owns the kind of place you’d expect a former hedge-fund manager would call home: six bedrooms, seven full baths, hand-crafted Italian doors throughout, high-tech security and sound systems, and 9,000 square feet of living space on 2.4 acres. It can be had for $7 million — a good deal, he says, when you consider his next-door neighbor’s comparable home sold for $9 million last fall. He has cut the price twice in the 12 months it’s been on the market.’
Undesirable Neighborhood COMPost…
Oh right Joe, blame the economy…not your own overreaching.
Hedge funds will be remembered as the worst example of bubble excess in the history books. Speculation factories, IMO.
muttontown getting hit huh?
the north shore of long island is not different? say it aint so!
god knows everyone needs 9000 sq feet of living space
Whoa is me, for my little mind will never, ever be able to understand why people who think that their houses are so god awfully special - would ever want to sell them in the first place.
Seven bathrooms? Take a dump in a different one each day of the week.
from the article
DiRenzo said that despite two price cuts to his home totaling $200,000, he doesn’t plan any more.
“The high-end buyers out there are maybe more selective now, but I’m willing to wait out the storm,” he said.
ride it baby to the bottom!
With his keen ability to size up the markets, I’m surprised he got out of hedge funds.
***********
“DiRenzo said that despite two price cuts to his home totaling $200,000, he doesn’t plan any more.
“The high-end buyers out there are maybe more selective now, but I’m willing to wait out the storm,” he said.”
The special on surfing recently showed that even the major surfers of the world get slammed. One or two even got killed, and they Knew how to surf the big waves. But this wave, may take out this guy and his 7 bathrooms. Hang Ten dude.
Hand-crafted Italian doors in Muttontown??? They should have spent the money on getting the town renamed.
“left a hedge fund two years ago to enter commercial real estate”
Talk about timing. Entering commercial real estate right when the downturn began.
Consumer prices soar.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aL2cNvLZtzMg&refer=home
So why doesn’t the Fed raise rates?
Because the U.S. economy is like a person with liver cancer as a result of a 10-year drunken bender, who is too weak for chemotherapy because of the danger of a sudden heart attack.
Good analogy.
Good or bad, right or wrong, I would not want to be Bernanke right now. It’s kind of like if your team is losing the super bowl 42-10 in the fourth quarter, your starting quarterback gets injured, and you are the backup quarterback. All eyes are on you, but there’s nothing you can do.
Benjamins Bernanke ain’t no Frank Reich…
Ahhh…I like that analogy with the exception being, you are Doug Flutie. He’s a winner.
I called my future wife (a long suffering Bills fan, but who isn’t?) when the score was 35-3, and begged her to stop watching the carnage, and say, let’s go out tonight?
So I drove over to her place, and a comeback broke out…
that was an awesome game
unless you were an Oilers fan
Give it the morphine and tell it to enjoy the high.
The economy should be in hospice.
“Because the U.S. economy is like a person with liver cancer as a result of a 10-year drunken bender, who is too weak for chemotherapy because of the danger of a sudden heart attack.”
In that case, how about a hair-of-the-dog hangover cure?
That’s really working out well this time, as you might’ve noticed.
BWAHAHAHHAHAHAHHAHHHHHHHHHHHHHHHHHH!!!
I know this question has been asked a dozen times and after an extensive search of previous threads I can’t seem to find the answer.
What are the names of some good books on the great depression? There are so many books out there I don’t even know where to begin. Any suggestions would be incredibly helpful.
Thanks again.
“Hard Times” by Studs Terkel is one. It consists of hundreds of interviews and conversations from those who lived through the GD.
A few gems…
“Ten Lost Years” by Barry Broadfoot.
He traveled all over Canada in the early 1970’s, interviewing the regular joes, about their experience of the Great Depression. Think Studs Turkel, but much richer stories, all a page to 5 pages long.
“Since Yesterday” by Frederick Lewis Allen.
Companion book to his “Only Yesterday” which chronicled 1919 to 1929. This book is about 1929 to 1939, and Allen masterfully talks not just about economics, but social conditions, fads, world-wide concerns of the time, and more, giving you a good feel for how it must have been, which looks awfully similar to now.
“The Great Crash” by John Kenneth Galbraith.
Reading this book, is like having your very own crystal ball to our immediate future.
Simply replace “stocks bought on margin” with “houses bought on margin” and it’s the very same saga.
One sour note in the book:
While most everybody went broke during the GD, our government was quite rich. This allowed the WPA, CCC, TVA, and various mega dams to be built, and much more.
Our situation d’jour, is 180 degrees opposite…
Thanks, I’m going to reserve a book or two from the library either today or tomorrow.
America’s Great Depression by Murray Rothbard - you can find a copy by just doing a Google search for:
America’s Great Depression Rothbard
And it will give you the result for a PDF from the Mises institute.
For a balanced account of the Great Depression, you need to read this, especially to balance against the views of Galbraith.
“There is something wonderful in seeing a wrong-headed majority assailed by truth.”
John Kenneth Galbraith
http://xroads.virginia.edu/~hyper/Allen/Cover.html
Only Yesterday free online.
Leigh
‘Free’ and ‘online’ are my two favorite words!
We are friends in a parallel universe
http://www.syracuse.com/news/index.ssf/2008/08/patersons_proposal_cuts_cny_ho.html
Paterson’s proposal cuts CNY hospital funding
by James T. Mulder
Thursday August 14, 2008, 7:09 AM
“Central New York hospitals would lose nearly $24 million over the next two years under Gov. David Paterson’s proposed Medicaid cuts, according to an analysis by a hospital trade group.
The Healthcare Association of New York State said the governor’s proposal would take away about $974 million from the state’s hospitals over the next two years.
Area hospitals that stand to lose the most include SUNY Upstate Medical University, $6.9 million; Crouse, $5.56 million, and St. Joseph’s, $4.4 million, according to the analysis.”
******************************
The other day I was reading responses to a story on the local Magna plant. As usual, the union/non=union arguments were flying. Then a poster chimed in that she works for Syracuse University and that with students facing a credit contraction, there’s concern in her office for their budget and their job security.
With education and hospitals, Syracuse’s largest sources of jobs, experiencing reduction of funds, it looks like this economic unwind train is picking up steam. The next stop: lay-offs spreading into “recession-proof” industries
I think Paterson has a heck of an easier job than Schwartzenegger or Crist.
The fact that we aren’t the worst off this time just means no outside help will be coming (not that much every really did).
NY interest groups are coming up with arguments to whine for federal money. I don’t think there will be much sympathy elsewhere.
Schwartzenegger or Crist didn’t lose 20-40% of Wall St. income.
Paterson didn’t lose 20-40% of Wall St. income…Wall Street lost 20-40% of Wall St. income. Besides, you give him way too much credit. He’s been in office all of what: 5 months?
The best Paterson can do is try to keep Wall St.’s implosion from bringing down the entire state. He got handed a time bomb whose fuse leads right up to Alan Greenspan.
hope they saved midnight baxitball
“hope they saved midnight baxitball”
Watchya hinting at tax?
Posted earlier this week, but reposting to hopefully get some comments—
Reading this blog helped saved my housing sanity. Starting in 2002, I couldn’t figure out how people were buying homes at ever-higher prices. I figured I was a lousy saver or lacked rich relative, etc. Price got higher and higher on houses yet they were still sold.
I’ve been trying to patiently wait for things to happen. So I wait, and wait, and wait. I see some cracks as houses bought 2-4 years ago are being listed for sale. Thanks to this blog, was able to check http://www.masslandrecords.com and see the history on a house listed last week.
8/2002 – purchased 278K, with 2 mortgages (80%/20%)
6/2003 – two new mortgages totaling 328K.
8/2004 – new mortgage at 368K.
5/2006 – new 2 year ARM mortgage at 390K.
Listed for sale now at 395K.
I would like to ask reader’s opinions on these numbers involving 2 houses in the same neighborhood bought by one couple. Both houses, in the New England area, went up for sale this summer, offered by the same realtor. Last month, they sold the first house. When I attended an open house at House #2, approximately 2,400 square feet, according to the realtor the couple is selling the second house to so they can “move to a bigger one.”
This history:
House #1 - When this house purchased the house was in move-in condition (owned by an older couple). While there they did the typical granite countertops and stainless steel appliances.
2/2005 – purchased for 362,500. Got 5-year ARM mortgage on $326,250 at 5.375%.
5/2005 – got an open-ended mortgage (HELOC?) for 36K.
In 2006 rented the house for around 1,850/month as they purchased house #2. Along with listing house for sale, were also listing it for rent.
7/2008 – sold the house for 366K.
Property taxes around $2,900/year.
Sale history:
1997 - sold for $160K
1994 - sold for $152K
House #2 - This house had more updates. Did put in an air conditioning and new heating system, though the old 50+ fuel tank is still there. In addition to the usual granite and stainless steel, chef kitchen with sub-zero refrigerator and professional oven, new custom cabinets, did repaint the exterior and knock down a wall to expand the kitchen area, along with some marble bathroom updating.
8/2006 – purchased for 508K. Got mortgages of 406,400 and 50,800.
1/2007 –financing statement filed against house for new heat and air conditioning system
8/2007- replaced the larger mortgage with a 500K mortgage
Property taxes approximately $3,900/year
Been on the market for over two months (at least 2 open houses) asking $600K.
Would like to know how these numbers are working for the couple. Maybe they know something I don’t that’ll get them to that bigger house.
Also, as of yesterday, this neighborhood has another 3 houses for sale with one piece of land. One house is a flipper purchase (bought in 2005 and the granite/stainless steel treatment), another was bought in the 1970s. The third house listed yesterday was bought in 2004 for $425K and is being listed at $398K.
People borrowed too much money against their house and now it’s time to pay the piper. They don’t know anything that you don’t. Prices are very sticky on the way down, especially if the borrower is still solvent. Right now the only sellers reducing prices are the banks. This mess will take years to work itself out.
It reminds me of this one property I researched about a year ago.. It was a 3bd nice house for sale for $750,000 in a desirable upscale neighborhood. The owner bought the house about 15 or 20 years ago for about $100,000 and every few years the owner cash out refi’d to keep up with the Joneses, you know, new cars, vacations, etc. Now this boomer owes more than $700k and it’s got it listed for sale for $750,000. He’s already spent his equity. I’m sure he’s got a good job and some investments, and he’s probably a fairly successful guy. But he’ll never come to the closing table with money if he has to sell for less than $700k, so he’s forced to live in that house forever. The price will never go below what he owes, at least not while he remains solvent.
When these people start to realize how much they are underwater now and how much more they will be as prices continue to drop, they will see “walking away” as a viable option.
This is just funny.
The guy does not believe in paper, pays for a truck half in coins and writes a check for the other half.
Scratching head.
Leigh
http://news.yahoo.com/s/ap/20080813/ap_on_fe_st/odd_coin_truck_purchase
When I was in the army. A guy on base got screwed by an auto loan shark (there all around military bases taking advantage of young GIs ). So he went to bank after bank got $6000 in penny’s and attempted to pay of his car at the loan company. They refused to take the money so he went to court. Judge gave him the car and the penny’s. Told the loan company the were out of line.
You think a bank would take payment in pennys?
That’s funny Peter.
I know all about the sharks around the bases - retired USAF (curtsey).
Leigh
Technically pennies are not legal-tender in large quantities.
Who says? Where can you find this in the law? Need evidense, proof other then heresay.
In Canada we have a currency act that limits foolishness like this. The maximum amount of coin you can pay with is $40 for toonies, $25 for loonies, $10 for a combination of quarters and dimes, and $5 for nickels.
http://laws.justice.gc.ca/en/showdoc/cs/C-52/bo-ga:l_I-gb:s_8//en?noCookie
Dan appears to be wrong again. Here is the snopes article:
http://www.snopes.com/business/money/pennies.asp
Scratching for good news anywhere they can….
http://www.detnews.com/apps/pbcs.dll/article?AID=/20080814/BIZ/808140356
Of Course the Mayor is involved in scandal after scandal…and he keeps his job
http://www.detnews.com/apps/pbcs.dll/article?AID=/20080814/METRO/808140351/&imw=Y
Not for much longer, methinks.
Wow, even dead people are bailing out of Detroit…
http://www.lewrockwell.com/blog/lewrw/archives/022350.html
That’s when you know the market has really hit bottom.
Got mosquitoes?
Green pools mosquitoes’ playground
Potential for West Nile virus has county on the offensive
By Roger Showley
STAFF WRITER
August 14, 2008
From a sheriff’s helicopter, every San Diego neighborhood sparkles with patches of light-blue backyard pools and spas, symbols of the good life in the Sun Belt.
Only these days, an increasing number of pools are turning slimy green from the algae that grow once owners turn off the filters to save cash or lose their properties through foreclosure. On weekly flyovers, county environmental health officers have spotted nearly 900 of these “green” pools since May.
No big whoop. I’m sure San Diego county has plenty of extra cash for this kind of stuff.
If not, they’ll assess a fee to the bank holding the property…who will then be even more desperate to get rid of it … so lower the price…and the spiral continues downward…..
It’s amazing how green they can get and how fast. My former boss had a filter outage and it got hideous within a week.
Mosquito larvae in the pool? No problemo, just toss in a quart of motor oil.
One of J6P’s auto lenders is closing shop in the U.S. …
HSBC plans to lay off 400 workers in San Diego
London-based bank to end U.S. auto loans
By Mike Freeman
STAFF WRITER
August 14, 2008
HSBC Auto Finance will lay off about 400 workers in San Diego in the next three months as the giant London-based bank stops making auto loans in the United States.
The company, which operates out of two buildings in Kearny Mesa, will have about 600 employees remaining locally after the layoffs, said bank spokeswoman Cindy Savio in Chicago. The workers will continue to service HSBC’s existing auto loan customers.
But the future for these workers doesn’t look promising. HSBC has stopped making vehicle loans through auto dealerships, online and directly to consumers, which made up the bulk of its auto lending business. The bank will continue to originate auto loans at its branches nationwide for the time being, Savio said.
HSBC executives said the bank has seen a surge in auto repossessions – particularly for sport utility vehicles and trucks – in the wake of high gas prices and a slumping U.S. economy.
Must be a fraud! If it is then it is the biggest I saw thus far…
http://www.zillow.com/Charts.htm?chartDuration=10years&zpid=19866263
Any openion
http://www.zillow.com/Charts.htm?chartDuration=10years&zpid=19866263
This must be a fraud! I wonder how is the lander paid for it.
Any thoughts…
Pop the pop
From the now I know how she got her great recipes department, she stole them from the French.
Newly released files detail early US spy network
“…Some of those like [Julia] Child on the list have been identified previously as having worked for the OSS, but their personnel records never have been available before. Those records would show why they were hired, jobs they were assigned to and perhaps even missions they pursued while working for the agency.
The release of the OSS personnel files unmasks one of the last secrets from the short-lived wartime intelligence agency, which for the most part was later folded into the CIA after President Truman disbanded it in 1945.
“I think it’s terrific,” said Elizabeth McIntosh, 93, a former OSS agent now living in Woodbridge, Va. “They’ve finally, after all these years, they’ve gotten the names out. All of these people had been told never to mention they were with the OSS.”…
A bottle of wine, a loaf of bread and thou…
Now we can all be spies…on each other.
Hoz, I’m going to report you Sheila Bair of the FDIC for saying that US banks aren’t the most solventest, evar!
lol
Ms. Bair is a brilliant person that is in the unenviable job of taking an insolvent institution (FDIC) and trying to make it appear viable. She is well aware that there are $39B left in the FDIC and that bank failures will require at least $816B in additional FDIC funds from the minimum 116 banks that fail in the next year.
What is she supposed to do? Tell the press that the FDIC doesn’t have moneys to cover the bank failures?? Go to Congress and ask for another RTC bailout for $1T? She is doing what any responsible person would do: nothing but wait and hope.
Really, you call this responsible? I shudder to think what you call irresponsible.
By this logic, the Tan Man has done no wrong. After all, mugs will be mugs, shrug, what can you do about it? He did what any responsible man would do. Make good while the getting was good.
Likewise, for the various CEO’s. You might as just wait and hope that things turn around, and if they don’t, well, mugs will be mugs, won’t they?
Pussy Galore would rather divulge all?
There is a middle path between flapping your gums incessantly and making moronic comments about bloggers being the cause of bank failures.
The banks failed because they did stupid things. They would’ve failed, blogs or no blogs.
I would never take such an “unenviable” job. If she is as “brilliant” as hoz claims, then surely she has no trouble finding alternative employment, right?
I beg to differ.
She’s a goverment salary bee-yatch who’s in the job of propagating a failing ponzi scheme. Calling her “brilliant” is like calling Typhoid Mary a
“positive influence on immune systems”.
If Ms. Bair or other senior individuals scream ‘fire’ before the event, the resulting panic would cause the financial collapse. That would be irresponsible.
There are no proactive actions that can be taken.
Right, in that case, you should just STFU not flap your gums.
Only genuinely “brilliant” people would blame the bloggers for the banks’ problems.
Still can’t believe you are defending that goverment salary whore.
FPSS,
I defend the gentle personable Ms. Bair. Just because a person is on the public dole does not mean that person is not productive. lol
And to compare her to a whore is not fair to all the whores that give full measure for services rendered. ;>)
Actually, she is threatening bloggers who “suggest” a bank is insolvent and defy the version put out by the Ministry of Truth.
Bloggers and short sellers would appear to be convenient scapegoats for regulatory authorities whose negligence contributed to the banking system mess at hand.
Are former Federal Reserve bank presidents legally allowed to comment on insolvent institutions in Bair’s version of the world (e.g., William Poole’s recent remarks about the GSEs)?
The idea that blog discussions can somehow precipitate a bank run is utterly preposterous. Your typical American who might want to pull their savings out of a bank in a moment of panic is at best only vaguely aware of the very existence of the blogosphere, and anyone who takes any undocumented statement on a blog as fact is a complete moron. Further, bloggers spreading false rumors about bank insolvencies would be readily and properly labeled as tinfoil hat wearing fear mongers, and roundly ignored. And if Indymac had not doomed itself by narrowly specializing in high risk Alt-A mortgages, there is a good chance its doors would still be open today.
Properly interpreted, I agree with Bair’s statement that the FDIC ignores bloggers at their peril. Too much group think in Washington’s tight knit policy circles can lead to severe myopia, which is not a big problem in the gloves-off environment in which bloggers exchange information.
And btw, Mr. Calvey, “were” is the past tense of “are,” not a contraction of “we are.”
Wednesday, July 23, 2008
FDIC learns it ignores bloggers at its peril
San Francisco Business Times - by Mark Calvey
The federal agency insuring bank deposits learned that it can’t afford to ignore the blogs following its seizure this month of IndyMac Bank, the largest bank failure since the 1980s.
“The blogs were a bit out of control,” Sheila Bair, chairman of the Federal Deposit Insurance Corp., told the San Francisco Business Times after a speech in San Francisco this week.
That’s putting it mildly. Following the FDIC’s takeover of IndyMac on July 11, widely followed blogs were speculating on bank runs on some of California’s largest banks based on nothing more than people waiting for their branch to open or large deposits moving between financial institutions.
The FDIC plans to pay closer attention to the blogosphere in the future.
“We’re very mindful of the media coverage and blogs in controlling misinformation. All I can say is were (SIC) going to continue to stay on top of it,” Bair said. “The misinformation that came out over the weekend fed a lot of depositors’ fears.”
I’m totally mystified that she thinks the blogosphere is out of control, when she knows that there are very few honest sources of information for the public.
There is just too much obfuscation to rely on the MSM or Bernanke’s tripe. Didn’t he give a speech saying “All is well, don’t panic” a week before bailing out Bear Stearns?
All they have to do is explain how much the bank has in “reserves”, and how much it owes depositors to show that there should be no fear.
Oh, … hh, maybe they should just not bring that statistic up in casual conversation…
PAGE ONE
FDIC Faces Mortgage Mess After Running Failed Bank
Subprime Lender Made Problem Loans On Regulators’ Watch
By MARK MAREMONT
July 21, 2008; Page A1
Federal officials heap much of the blame for the subprime mortgage mess on lenders, claiming they recklessly made too many high-cost home loans to borrowers who couldn’t afford them.
It turns out that the U.S. government itself was one of the lenders giving out high-interest, subprime mortgages, some of them predatory, according to government documents filed in federal court.
The unusual situation, which is still bedeviling bank regulators, stems from the 2001 seizure by federal officials of Superior Bank FSB, then a national subprime lender based in Hinsdale, Ill. Rather than immediately shuttering or selling Superior, as it normally does with failed banks, the Federal Deposit Insurance Corp. continued to run the bank’s subprime-mortgage business for months as it looked for a buyer. With FDIC people supervising day-to-day operations, Superior funded more than 6,700 new subprime loans worth more than $550 million, according to federal mortgage data.
Apparently Julia Child was too tall for Armed Services regs at the time (she was 6′ 2″), so she volunteered for the OSS. Her husband was also an OSS officer.
Ouch, say the residents of greater Sacramento!
Roughly three quarters of Yuba-Sutter homes purchased in the last five years are worth less than their mortgages, said Zillow.com, an Internet home-value provider.
Four in 10 homeowners who bought houses in El Dorado, Placer, Sacramento and Yolo counties since 2003 now owe more than their homes are worth, according to the online real estate firm Zillow.com.
A simple thought:
1 year ago Fannie’s yield traded about 60bps over US Treasuries. Fannie had an implicit US government guarantees. Today Fannie’s trade 140bps over treasuries and have an explicit guarantee. Is that loss of confidence in the US government?
Hey hoz (or anyone else) what do you think about picking up some GLD right now holding through about Feb? With maybe a 10% stop loss?
I have little interest in gold and gold stocks. It is a multi government easily manipulatable market. If there is a PPT, the gold market is what would be manipulated.
One of the items the Federal Reserve uses to calculate inflation expectations is gold prices. It is in the government’s interest to keep prices stable.
I think you would be better off buying non manipulated metals, non futures metals stocks. These metals include iron ore, rare earths, cobalt, etc. These prices have not come down, but the stocks have. Some of these companies are trading at current PEs of 5. Many of these companies have no debt. And some of the really good ones are traded on the NYSE. Few are US companies.
“If there is a PPT, the gold market is what would be manipulated.”
More to the point, since there are a huge number of Americans who were sold on the 401(K) revolutions and whose private pension wealth depends on the stock market delivering, and only a few true believers in the theory that gold is the only safe currency in an era of financial turmoil, there is a huge political incentive to pull whatever levers are available to prop up the stock market and, if it helps the cause of forestalling panic selling of paper assets, to hammer the gold market.
Prof. Bear:
I remember the gold and silver bubbles when I was a teenager in 1979. Lots of folks lost their shirts. Gary North at Lew Rockwell says that Austrian Economics (which I really need to learn about!) show that gold and silver will be in a bear market from now on, and that the problem with the economy will be deflation, not inflation. I just bought some coal mine stocks as it seems to me that consumer goods, housing, wages, cars and such like are deflating, wheras food and fuel are inflating. It seems that there are just a million good ways to lose money right now. What do you think is going to happen?
I like the idea that the Gold market is currently manipulated…
Imagine what it will do as various governments’ power to hold it in check, goes away?
http://news.goldseek.com/GoldSeek/1218738527.php
Thanks.
I just had the idea I might try the technical play, it looks like we could get a run through the winter.
Maybe I’ll just take 10 grand to Tunica. I’ll probably do better on the craps tables anyway.
“Is that loss of confidence in the US government?”
I view it as a loss of confidence in the US government’s unfettered support for the GSEs. There is a raging debate going on in policy circles at the moment over whether HP went too far in committing the US tax base to guaranteeing GSE debt, without asking enough in return.
Maybe it’s the decision to stick Jumbos in with general Fan and Fred bonds, which the stock market is so happy about.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a9O8KyVuqSTg&refer=home
Won’t this have the (unintended?) consequence of adding still more systemic risk to the GSE balance sheets, and by extension of the implicit GSE debt guarantee, to Uncle Sam’s balance sheet?
But I suppose it is for the greater good of the country, as this will help wealthy people in the market for homes priced above $417,000 to be able to afford to live the high life they deserve.
Higher than expected inflation is good for stocks, but bad for gold. Who’d've thunk?
http://www.marketwatch.com/
Condo complex in Houston in dangerous condition. Underground parking garage is crumbling, endangering the condos above.
Condo owners have been paying their association fees, but don’t know where the money has gone. Until this summer, the condos were managed by one of the largest property management companies in the nation. CEO of said company is a TX state legislator - wrote the Texas Residential Property Owners Protection Act, so-called.
video and text:
http://www.txcn.com/sharedcontent/dws/txcn/houston/stories/khou080813_rm_fallingcondos_.431abeeb.html
Steve Henn: RealtyTrac may be the most widely-cited source of foreclosure data in the country. The company tries to capture every public foreclosure filing. It’s numbers drive public policy debates and are quoted from the Wall Street Journal to CNBC — but many industry insiders question the companies figures.
For years now, RealtyTrac’s reported Colorado has one of the higher rates of foreclosures in the country. But:
Ryan McMaken: Colorado is not experiencing any general crashes in housing values.
Ryan McMaken at that state’s department of housing says different states have different legal systems and generate different records. That makes an apples to apples comparison tough.
And recently, legal changes in New York, California and Massachusetts have made tallies there harder. The laws slow down foreclosure proceedings, but thousands of homeowners are still behind on their mortgage payments — even if they don’t show up in this month’s RealtyTrac.
Er, wouldn’t laws that slow down foreclosure proceedings imply that RealtyTrac’s foreclosure figures represent an undercount???
I hope so. From what I look at in Queens, there records tend to be cr*ptastic.
The Taming of the Shrewd…
Hence comes it that your kindred shuns your house,
As beaten hence by your strange lunacy.
O noble lord, bethink thee of thy birth,
Call home thy ancient thoughts from banishment.
“…Political market calls are conceived in sin, since most are based on the false premise that the stock market prefers Republicans to Democrats. According to Sam Stovall, chief investment strategist at Standard & Poor’s Equity Research, between 1945 and 2007 the S&P 500 rose 10.7 percent annually when Democrats occupied the White House, compared with a 7.6 percent annual increase under Republicans. Those who, fearing higher taxes, sold stocks after Bill Clinton’s inaugural missed out on a great rally. And those who, anticipating lower taxes, plunged into the market in January 2001 entered what has been a lost decade for U.S. stocks; since 2000, the markets of countries like Brazil and China have lapped their American cousins….”
Slate
Hah! I remember R-can colleagues fearing the worst for stocks at the beginning of Clinton’s first term. They never mentioned another word of their unwarranted pessimism once the market went into a historic bull run.
‘After being stonewalled for nearly a month, Rep. Darrell Issa (R-CA) and Rep. Mark Souder (R-IN) have sent an official request for an Ethics Committee investigation into “disturbing allegations,” first reported in Conde Nast Portfolio, that Countrywide Financial gave illegal mortgages prohibited by House rules to members of Congress, congressional staff and other officials.’
‘The allegations of illegal gift giving swirling around the Country VIP program are broad and serious,” Rep. Issa noted. “In a Congress that was supposed to emphasize ethics, it’s disappointing that no committee chairman seems to want to claim jurisdiction and investigate the nexus between the mortgage crisis and public officials who got too cozy with lenders.”
‘Souder noted that: “Since the allegations surrounding the Friends of Angelo list first surfaced, I’ve been urging an investigation,” adding that he has “also introduced the Financial Disclosure and Integrity Act to urge transparency and ethics reform in this area”
Small potatoes. If they really want to investigate something then have them take a look at these allegations.
http://news.goldseek.com/GoldSeek/1218694140.php
I am thrilled Catherine Austin Fitts is getting more exposure. An ethical ex-insider (hence the ex part) who labors to help john doe extricate himself from the thievery which substitutes for a banking system in the G7.
Yea!!! The banks are saved. The housing market can be re-inflated. SIFMA will now allow conforming jumbo loans into the regular conforming securitization pool. Methinks this will just poison the whole well but what do I know.
http://bloomberg.com/apps/news?pid=20601087&sid=aRvtq5NBNBFY&refer=home
Oh my word…. Gold is down another $13.
I am starting to see the outlines of a silver lining scenario emerge from the wreckage of the housing bust, where gold, oil and housing prices keep falling for the foreseeable future while stocks and Uncle Buck keep strengthening. At the end of the day, the forces of asset price inflation in paper assets will balance against the forces of deflation in real asset prices, and the stage will be reset for another Great Moderation in the global economy like the one that began circa 1980.
Cramer just told me that happy days are here again…
Yeah but where are the 16% CD yields?
I thought that was supposed to be “up by negative $13.” Silly me.
Up a negative $17. It’s another rally!
Public pension funds increase risky bets in an attempt to fill deficits in retirement plans and make up for their worst performance in six years. E.g., CALPERS lost 2.4 percent in the 12 months ended June 30 & approved an expansion into commodities in the past year. States owe about $2.35 trillion in pension payments over the next 30 years to retirees, the Pew Center on the States said in December 2007 report.
Yeah that’s wonderful news.
Why doesn’t DiNapoli just take all of NY’s public employee pension money to Vegas. If he wins, he can hand out even richer pensions to the unions and say it doesn’t cost anything. If he loses, the pensions still get paid and public services get eliminated, but he doesn’t have to care.
What they have actually done is a less extreme version of this. Less extreme so far anyway.
I read elsewhere that New York State based a purportedly low cost for a pension enhancement passed in 2005 based on pension funds through 2000. Yep.
Downey goes Frazier!
Another potential run in the city of angles, coming on the heels of last month’s FEDstivities?
Home Prices Fall 7.6 Percent- CNNMoney.com
US Foreclosure Filings Surge 55 Percent- AP
Inflation Jumps to 17-Year High- AP
Jobless Claims Fall Less Than Expected-
But a couple clowns say Financial Stocks Have Bottomed, says Bullish Fund Manager and the market advances? Makes sense?
http://finance.yahoo.com/
Another house rich cash poor antedote. My MIL and her sister and brother live in house they purchase in late 60’s all paid around 22k-35k. Each of there home is still markey value around 500k plus (West Covina, La Puenta). They have all retired with decent pension but no real saving left on account of there bad kids and toys(lawyer fees, boats, four wheelers)… So they all are sweating bullets because there “equity” is not as much as the Jones got when the sold in 2005. So any increase in the taxes rate will kill them because there is no money to pay it.
Why more people didn’t sell their houses in the city of angles, and go replicate their lives somewhere else on the cheap is beyond me?
You could buy a bigger home in a neighborhood that looks a lot like West Covina, somewhere in flyover-villle for $100-150k.
“Why more people didn’t sell their houses in the city of angles, and go replicate their lives somewhere else on the cheap is beyond me?”
Because in fly-over-ville you ain’t got the buzz of the entertainment industry, fifty-something Sushi restaurants, or beaches overlooking the Pacific where the bronze sex goddesses play volleyball.
Trust me…
If you live in West Covina, you are 50 miles from the buzz of the entertainment industry, another 50 miles away from the beach, and nowhere near any goddesses, real or imagined.
What’s so bad about hours of mind-numbing traffic to reach the beach just to get stung by a jellyfish and be pestered by a scary panhandler? Sounds like an adventure to me. You might even see a celebrity!
From the current Newsweek:
On Realty Road, It’s a Rough Ride
Real-estate agents are an optimistic bunch, but it’s hard to put a positive spin on the nation’s deepening housing bust. In the past year, the average U.S. home has lost 16 percent of its value, and the number of homes changing hands has dropped by one third since the market peak in 2005. Since most agents make money only when houses actually sell (most earn no salary), that’s leading to a sense of desperation in some hard-hit regions. In one Los Angeles-area brokerage office, an agent told NEWSWEEK, the outlook is so bad they’ve even set up a food pantry with pasta and canned goods so struggling agents won’t go hungry.
Consider the scene at Prudential California Realty in Cypress, a community in well-heeled Orange County. Manager Christine McGowan says she’s watched a number of her employees lose their own homes to foreclosure. Among them is Michael Vasquez, a veteran broker, who lost his—and his marriage—when financial stress contributed to his divorce; he was forced to move in with a friend. He hasn’t taken to moonlighting, yet. But colleague Chrysteen Bandy has: she works three hours each evening selling Marriott time-share vacations. “It’s been a major struggle for everyone,” says McGowan. “I just don’t think people fully realize what [agents] are going through.”
In Florida, at the center of the housing bust, conditions aren’t much better. Jack Meeks, owner of Real Estate Professionals of America, has downsized from 123 agents to 55—and the entire office is selling just 10 homes a month. In some parts of the state, analyst Jack McCabe says, homes are selling at a rate of less than one per year per agent—and nearly a third of sales are foreclosures, which are often done without an agent. “The truth is, [agents] are getting destitute,” he says.
Meanwhile, membership in the National Association of Realtors has dipped by just 7 percent since 2006, to 1.3 million. And it’s not clear those ranks will fall much further, since many agents sell homes only part time, or rely on a spouse’s income to support them through down markets. If nothing else, the current market may help counter the boom-time image that selling houses was an easy ticket to quick riches. The reality is a whole lot tougher.
© 2008
“In one Los Angeles-area brokerage office, an agent told NEWSWEEK, the outlook is so bad they’ve even set up a food pantry with pasta and canned goods so struggling agents won’t go hungry.”
Mr. RealTard, meet your new colleagues, Mr&Mrs. FB.
“an agent told NEWSWEEK, the outlook is so bad they’ve even set up a food pantry with pasta and canned goods so struggling agents won’t go hungry.”
2005: Lobster & Dom Perignon
2008: Soup Line
These two sentences jumped out at me:
If nothing else, the current market may help counter the boom-time image that selling houses was an easy ticket to quick riches. The reality is a whole lot tougher.
Why? Because I know several long-timers in real estate sales and investment. All are very hard workers with incredible stamina. And they need these things because they are in a 7-day-a-week business.
Borrowing money and speculating during boom times can make anyone look like a genius. I still remember when they had the chimp throwing darts who was doing better than 75% of the stockbrokers, not too long ago.
Genius is a rising market, or a falling market if you are short
How can a four-week moving average rise on a drop in first-time applications for state unemployment benefits? The explanation is that even though first-time applications fell by 10,000 for the current week, they remain at a level which is higher than what it was five weeks back.
In fact, one can deduce the level five weeks ago from this calculation:
Ave0 = last week’s 4-week moving average
Ave1 = current 4-week moving average
x = level of first-time applications five weeks ago
y = sum of first-time applications for four weeks, three weeks and two weeks ago
z = current week first time applications
Ave0 = (x+y)/4
Ave1 = (y+z)/4
Ave1-Ave0 = Increase in 4-week moving average = (z-x)/4 = 19,500
z = 450,000
x = 450,000-4*19,500 = 372,000
z - x = 450,000 - 372,000 = 78,000 increase in rate of weekly new claims for unemployment over the past month
Check: Ave1 = 19,500 = (450,000 - 372,000)/4
ECONOMIC REPORT
Trend in jobless claims rises to six-year high
Initial claims drop to 450,000, down 10,000 in latest week
By Rex Nutting, MarketWatch
Last update: 9:11 a.m. EDT Aug. 14, 2008
WASHINGTON (MarketWatch) — First-time applications for state unemployment benefits fell by 10,000 to stand at 450,000 in the latest week, but in a worrisome sign, the smoothed trend in new claims moved to its highest level in more than six years, Labor Department data showed Thursday.
…
The four-week average of new claims rose by 19,500. At 440,500, this gauge stands at the highest since April 2002.
Can I keep her in the barn?
http://littlerock.craigslist.org/reo/796236523.html
I was at a Peter Schiff talk last weekend and he was touting the Perth Mint for buying unallocated gold. Is this a good idea as a gold play?
Peter also said that down the road the govt will impose restrictions on investing outside the country including foreign currencies. Probably high taxes to discourage the practice. He also said that there will come a time when those who are renouncing their citizenship will be forced to leave the country broke. What are the chances of these kind of scenarios coming to pass?
I listened to him talk nonstop for well over 2 hours and it seemed to go by very quickly. He was adamant that the dollar was toast, and that this commodities and foreign stocks dip was nothing but an opportunity to buy more.
http://www.goldmoney.com is less of a hassle and it is allocated to you. Accomplishes the same thing as Perth but can be held in Zurich, much friendlier jurisdiction, banking law wise. It’s a legit deal and I’ve had an account for a while now. Regardless, both of these accounts must be declared to Treasury on their form TD F 90 (you can google and download it, short form, no big deal).
“He was adamant that the dollar was toast, and that this commodities and foreign stocks dip was nothing but an opportunity to buy more.”
Well, that was last weekend, before gold and silver fell another 10%. The technical damage to the metals is almost unbelievable and how quickly it came, especially since nothing economically has changed. Do people really think the stock market is going to continue to rally? When probably only 1/4 or less of eventual losses has been disclosed. Then again, nothing really makes sense anymore.
The IRS already says that if they decide that you are renouncing your citizenship primarily to avoid taxes, they will tax you anyway for 10 years.
Well, I just read that the US Mint has suspended sales of 1 oz Gold Eagles. The price has plummeted below $800/oz. Interesting diversion…the futures market is crashing hard, yet demand for physical bullion is unquenchable.
tonee.
as a resident profiler. blog watcher. precious metals holder. strong senitment indicator. contrarian. tin foil artist. and average J6P. I would offer the following:
The gold bugs are out in full force. This usually happens when you are sold “a bill of goods” that cant be defined in forms other than your own reasoning for even having purchased them. And I will always defer to the line of reasoning, “One ounce of each will get you a plane ticket anywhere in the world.”
Im not goin anywhere. But I wonder to myself, who is? Im not gonna google a ticket price from A to B, it always depends on perspective…think, why should dollar rally and oil NOT be so important? How poorly a venture in terms of moneys will the Iraq and now, Georgian conflicts look when line drawing politics of turning off the spigot are revealed?
sittin at home after work, sippin a beer……hmmm, where’s all the panic? Where is the hysterics? Why cant we get some fear working? When the VIX goes lower, you climb the worry….whats everbody all worried about? Everybody knows THOUSANDS of banks are going under…..dollar is toast, gold to the moon, housing credit binge of epic proportions gettin unfolded….oil is the most precious refined product in modern human history…
TSHTF countdown,3….2……1…….
This is the housing bubble blog. The solution starts here.
disclaimer: long natgas/oil.gold.foreign bonds and fiat. US bonds. Munis.foreign equities. US equities. commodities..with no short positions. I cant balance the balance of the big picture, jeez, I put in 60 hour weeks. I still contract and get paid, pay bills, and yes, consume and invest with dollars.
arithmetically,
the mean.
I think back to a time not so long ago, when a hard working young man wanted to sell his gold coin. Futures at that time were trading over a thousand dollars an ounce, but he was willing to sell it for 900…I did not buy the coin, and I called it my shoeshine boy momment.
However, I was reminded that the shoeshine boy was advising on what to BUY, as opposed to what to sell. You can go out and buy whatever coins you want at but a small premium over spot.
just my 3 cents worth. Hey, that reminds me of the story of the 1901 penny.