The Problem With The Housing Market In California
The Press Enterprise reports from California. “For Inland Empire Auction in San Bernardino, the current economic slowdown has been a mixed blessing at best. The auction house is loaded with household items, including furniture, jewelry, tools and various appliances, much of which likely came from various home foreclosures. The problem is there’s a lack of disposable income among the buying public, which is also the result — at least in part — of the increase in single-family home foreclosures.”
“‘It started to pick up within the last six months,’ said said Rich Wasser, secretary with the nonprofit Southern California Auctioneers Association in Rolling Hills Estates. ‘We’re seeing more of them as the economy keeps slipping, industrial sales and a lot of (residential) items. You have more houses now being sold at auction. I’m also a real estate broker, and I’ve never seen the market take a dive like the one it’s in now.’”
“Like the housing market, the local auction industry has become a buyers’ market.”
“‘There’s a lot of merchandise, but there aren’t enough people out there who are buying it,’ said Terri Cooper, a manager at the story for 26 years. ‘We’re doing more auctions than we used to because we have so much to sell, but we aren’t making as much money as we used to.’”
The Times Delta. “First came the housing market crash. Then fuel prices started to skyrocket. Finally, there was the credit crunch. It has all added up to a slow summer for auto dealers in Tulare County and around the nation.”
“‘The tables have kind of turned,’ said Jason Martin, general sales manager for Merle Stone Chevrolet in Tulare. ‘Everything has dropped.’”
“‘[Business] was already slow when the [real estate] crisis hit last year,’ said Leonard Garcia, fleet manager for Will Tiesiera Ford in Tulare. ‘But once the price of gas started to go up, that’s when the trouble began.’”
The Manteca Bulletin. “One of Manteca’s biggest builders - Woodside Homes - has filed for bankruptcy protection. The home builder has housing projects that are part of the 402-lot Tesoro neighborhood as well as a portion of the 497-homeUnion Ranch East directly east of Del Webb at Woodbridge on North Union Road.”
“Woodside is still in business and selling homes in Manteca. The bankruptcy chapter it has filed under allows it to try and reorganize and continue staying in business.”
“The biggest collapse in Manteca, though, involves Beck Properties. The Stockton-based Beck Properties is the developer of luxury homes in a gated community at Oakwood Shores located at West Woodward Avenue in Manteca that is going through the foreclosure process.”
“The city took emergency action Monday afternoon in boarding up an ‘abandoned’ home at the corner of Pestana and Falmouth avenues after finding two teens - a boy and a girl 15 and 16 years old - inside the house they said was filled with human feces.”
“The teens were escorted by Manteca Police officers to their high school classes shortly before 10 a.m. Monday.”
“Windows had been broken out and the lawn and shrubs had long been dead at the residence not posted on any foreclosure list. Two dust covered cars were parked in the driveway apparently left there by neighbors.”
“Code enforcement officer Greg Baird said he cited the owner for having an unsecured structure several months ago noting that nothing has happened to correct the problems since then. The water was turned off two years ago and the house has been unoccupied since except for trespassers making use of a lone couch.”
“It was the first house targeted in Manteca after the City Council last fall adopted one of California’s toughest ordinances to clamp down on the problems caused by the growing number of foreclosed and distressed properties.”
“Lenders - which have tended to ignore property going into foreclosure until they legally take it over - are faced with a house that is less valuable as whoever they sell it to would be forced to pay off the city lien in addition to the foreclosure price. Many lenders aren’t cutting deals on what is owed. The city ordinance places a burden on them.”
“It also places a burden on whoever has legal title to the home. It could be a rental that isn’t in foreclosure but has sat vacant or is a short sale. By not maintaining the property, they will face additional financial consequences.”
“And if they take the attitude they are ‘upside down’ on mortgages and don’t have to face financial consequences, the lien paid by whoever buys the property - as well as whatever the lender is shorted - is considered income by the Internal Revenue Service and State Franchise Tax Board that the individuals being foreclosed on are still liable to pay.”
The San Francisco Chronicle. “The government’s seizure of mortgage giants Fannie Mae and Freddie Mac on Sunday might ease home loan rates, but most industry observers believe it will only marginally aid the slumping real estate markets.”
“The takeover, however, generally won’t mean money is more readily available for distressed homeowners on the brink of foreclosure, nor will it provide any real assurance for those holding off on purchases for fear values will continue to fall, said Ken Rosen, chairman of the Fisher Center for Real Estate and Urban Economics at UC Berkeley.”
“‘It’s a confidence booster in the financial market, not really directly aimed at the housing problem,’ Rosen said. ‘It’s a positive, but it’s a small positive.’”
“‘Anyone who thinks this is an interest rate issue is fooling themselves,’ said Christopher Thornberg, principal with Los Angeles consulting firm Beacon Economics. ‘This is a prices being too high and people buying homes they couldn’t afford issue.’”
“California price declines will only stop once home values are properly aligned with income levels, or about 50 percent below the peak, he said. As of July, the median value of homes across the state was down 33.5 percent from a year earlier, according to MDA DataQuick.”
Bay Area Newsgroup. “Thornberg predicted more erosion looms. ‘I still have the same forecast for California home prices. Prices in the state have to decline by 50 percent,’ Thornberg said. ‘And we are about half way there. My guess is the East Bay is about half way there.’”
“Tammy Cryer, senior loan officer with the Home Loan Group in Lafayette, said interest rates could be higher six to 12 months from now.”
“‘Right now it appears to be working, but this thing isn’t even 12 hours old,’ Cryer said.”
The Sacramento Bee. “Rates, which have declined for almost two weeks, dropped as low as 5.875 percent Monday, said Jeff Tarbell, managing partner of Sacramento-based Comstock Mortgage. That’s down from 6.25 percent on Friday and back to levels last seen between January and May.”
“‘I’m calling people and saying, ‘I’m saving you $28,000′ (over the life of a 30-year loan). That’s a call I always like to make,’ Tarbell said.”
“Brian Jacobosky, a Folsom house hunter, said he’s pleased to see rates fall after the federal takeover. But he said, ‘That’s not going to change our game plan.’”
“His family is browsing for a home after selling a house in Arizona and moving to Sacramento. Jacobosky thinks he’ll get more financial mileage from declining sales prices than fluctuating interest rates.”
“‘This is simply preventing it from getting worse. This doesn’t fix the fundamental problem in real estate,’ said economist Chris Thornberg. ‘The problem with the housing market is prices are too high.’”
“Thornberg said the economy’s problems now go beyond the housing market. Consumer debt is a major issue. ‘This is a nation that has been spending way beyond its means,’ he said.”
“Part of that was home equity borrowing. ‘All this fake wealth we thought we had … is disappearing,’ he said.”
The Union Tribune. “Real estate analysts yesterday praised the government takeover of mortgage giants Fannie Mae and Freddie Mac, but cautioned that the action won’t quickly end San Diego County’s housing slump.”
“At the University of San Diego’s Burnham-Moores Center for Real Estate, economist Alan Gin said the government takeover will inject confidence into the marketplace, allowing mortgage rates to continue to fall. That may not bring San Diego County out of its housing slump, but it should cause home prices to drop more slowly, he said.”
“According to the MDA DataQuic, the combined median price for homes that sold within the county in July was $364,000, a 1.6 percent drop from June and a decline of nearly 26 percent from July 2007. The median price peaked at $517,500 in November 2005.”
“In its monthly foreclosure report, DataQuick said 2,004 San Diego County homes went into foreclosure in July, a 9 percent increase over the June and a jump of almost 213 percent over last year. July was the region’s 40th consecutive month of year-over-year increases for both foreclosures and notices of default, the start of the foreclosure process.”
“‘We have a lot of problems, foreclosures being the biggest,’ Gin said.”
“Kelly Cunningham, economist for the San Diego Institute for Policy Research, is…optimistic. The market should reach bottom by the spring of 2009, he said.”
“‘I really think San Diego will be one of the first places to turn around,”‘ he said. ‘I don’t think we’re overbuilt. There still is a lot of demand for housing. We are getting to a point where prices have dropped enough.’”
The Associated Press. “Californians rave about year-round sunshine, temperate climate and easy access to surfing, snowboarding and everything in between. But when it comes to getting the most out of their homebuying dollar, they’ve got nothing on homeowners in the Midwest, a new study suggests.”
“Eight out of the top 10 most expensive housing markets in the U.S. are in California, while eight Midwestern cities are among the 10 most affordable markets, according to the Coldwell Banker Home Price Comparison Index released Tuesday.”
“The sharpest contrast was found between La Jolla, Calif., and Sioux City, Iowa - the most expensive and most affordable cities, respectively, tracked in the study.”
“In La Jolla, an upscale seaside suburb of San Diego, the average price of homes tracked by the study was about $1.8 million. In contrast, the average price of a similarly-sized home in Sioux City was $133,459 - about 13 times more expensive.”
“Philip Deslippe knows what it’s like to go from a pricey coastal market in California to an infinitely more affordable city in the Midwest. The graduate student and his wife moved earlier this year from Los Angeles, where they lived in a rent-stabilized apartment for $900 a month, to Iowa City, Iowa.”
“Now the couple owns a three-bedroom, one-and-a-half-bath home and pay a mortgage that’s just under what they paid for their L.A. apartment.”
“Things he and his wife were longing to do, like ’settling down, having a home, raising a family - I don’t think any of these things would be possible in Los Angeles, considering the cost of a home,’ said Deslippe, 30, who turned down acceptance letters from universities in Boston and Washington, D.C., in part, because of home prices. ‘I knew that housing would be much cheaper here in Iowa City.’”
Happy 158th birthday California…
The Golden State’s name comes from a novel written in 1510, and here’s a fanciful description of the natives, by García Ordóñez de Montalvo.
————————————————————
“Know that on the right hand from the Indies exists an island called California very close to a side of the Earthly Paradise; and it was populated by black women, without any man existing there, because they lived in the way of the Amazons. They had beautiful and robust bodies, and were brave and very strong. Their island was the strongest of the World, with its cliffs and rocky shores. Their weapons were golden and so were the harnesses of the wild beasts that they were accustomed to domesticate and ride, because there was no other metal in the island than gold.”
http://en.wikipedia.org/wiki/Origin_of_the_name_California
So many great things to do in Iowa City, too, if it’s anything like Des Moines! Why, you could have some beers in a bar. Then you could, ahh… dunno really?
Doesn’t really matter where you are. If you have no money, you aren’t even drinking beer in a bar, are you?
Depends on your Attractiveness, really. And openness to new adventures.
wink wink, nudge nudge, say no more………
Well, friends in construction biz, sold their house in 03, La Quinta and moved to Iowa. They didn’t get the High 05 sale, but the money they got, they bought outright their home in Iowa. Now they send me email photos of all the vacations they take, and of how unstressed they are.
Affordability. That is the name of the game, not house poor.
Been there, done that. Ne’er more.
Selling your home in California and moving to your choice of 49 other states was like hitting the lottery, but you had to make the break with where it is you were living, and family and friends…
Relatively few Californians did this, considering the payoff~
How many did, and miss their friends and family? I have friends that moved back to our area (Norfolk/Virginia Beach, VA). They like being near family, but there just aren’t the same caliber jobs. He still works for the company in San Jose / Reston so that is good. But all the cool jobs are where it’s expensive.
As a CA native who recently got the hell out, I have to call bogus on that.
We left CA for St Louis. Our jobs are more interesting and pay far better (though that’s not saying much as we worked for UC).
The difference in the cost of living is shocking. We live like kings frankly. The museums and parks are all within easy walking distance. We spend time exploring the city and trying new restaurants. Chicago is an easy drive for a long weekend. We do this often.
We still save the same amount each month that we did in CA. If we were to buy right now, we’re looking at straight cash offers. We’re pretty tempted.
We live in a pretty hip little area near the Univ Loop. The place we rent now would have run us at least 2850 mo back in Sacramento for a similar house and neighborhood. I’d hate to think what a place near Stanford who cost us. The lease is 1250 mo for a flat that would make most people in SF cry with envy.
We’re trying to start a family and I’m lucky to be living next to several top research hospitals. In fact, we work for one.
The best news is that as soon as my mom sells the house in HB, she’s moving out here too. She’ll be able to buy or rent cheaply and live off her pension alone. That means she pockets the entire 1 mil after she sells. That’s a lot of damn fine healthcare coming her way.
We just wish we’d moved sooner.
That’s great. Glad to hear it.
Can you convince like a million more people to follow in your footsteps?
Thanks.
Brad
San Diego
Funny but for some reason most always seem to come back.
I did that in 2005 and then came back due to family and it was too hot in Texas. I’m now renting and waiting for further price drops to buy again, perhaps by 2010.
I left CA in 2006. plenty hot here in AZ however at about a 12000 a year difference in rent plus the cash I stashed form the sale of my over priced Townhome in Cali I’d say I’m doing OK.
Had the chance to move back to CA a month ago , no thanks I’ll stay in Phoenix. The pay was the same.
I like renting too, I keep telling this guy I work with to walk from his house he can’t afford and join the dark side, join the renters.
HAR!
The Renters.
What’s wrong with us renters?
Leigh
I agree, we left Cali about 3 years ago and haven’t looked back. Born and raised there for 30 years. All our family and friends are back there. We got out as soon as we realized the state was quickly sliding downhill. I can’t say we regret it one bit. Sure, we miss our family and friends, but you know what - it’s a short jaunt from CO to CA and we’ve made some great new friends here.
We’ve bought a house - one that would have cost us easily 4 times as much back home and been in a craptacular neighborhood to boot. We live in a country setting but close enough to the city to not be an issue.
We have more disposable income every month and we are in a much better position than we’ve ever been. Also, we actually make more money at our jobs in CO than we did in CA.
Sure the weather’s nice, but I don’t miss the traffic, the millions of people, the taxes the high cost of everything and multiple other reasons I won’t even go into.
But yeah, can’t say we miss it one bit - well, except for the In-N-Out.
California definitely has a lot going for it in the natural beauty, parks and recreation department. But here’s the rub: incomes (aside from the top 2%) aren’t all that great here, and you can’t eat sunshine or house your family in scenery.
Quite frankly I’m ready to go back to four seasons if it meant a cheap house with some land to it. Constant sunshine is vastly over rated.
Constant sunshine?!! WTF?!! If you live anywhere within 15 miles from the coast you can go 30 days or more without seeing any real sunshine….in the middle of summer! I remember getting so depressed I’d have to hop in the car and drive to the desert to remember what that yellow orb looked like.
I even have a theory, having come from a state that had 4 seasons but having lived in CA most of my life, that the lightweight weather we have here in CA turns a lot of people into douchebags for the simple fact that they aren’t humbled enough by mother nature. A good snowstorm or even a decent thunderstorm makes you realize that you ain’t all that.
And here I thought Californians had the market cornered on smugness…
Funny, I’ve seen MidWesterners lose it like little girls at a 6.0 earthquake (snore)
California has been an overrated POS state from the getgo…
What would possess people to live in such filth?
You must be single. When you’re married with children, your priorities are very different - things like a schools, a good environment, a house with enough space, etc… — unless you’re rich and have nannies, etc, there’s no difference in daily life for the married with children between San Francisco and Iowa City.
I’m not rich I’m a renter. Would be fun to tell my 14-yr old, Son, we’re moving from Newport Beach to Iowa City. No beach, no mountains, but plenty of cornfields and lowered expectations!
As a kid who grew up in Kansas City, I am quite certain there would be a huge difference in daily life. Compared to Iowa City, KC is Manhattan.
What do you mean by lowered expectation? Do you think that folks in Iowa City all live in poverty?
Some of us HBBers are University of Iowa alums…Iowa City is Big Ten country. 28,000-30,000 students.
Lowered expectations are in the eye of the beholder. If you are too mentally dull to generate your own excitement, then you’re right, one ought to stay in California.
If your view of the world is, *Here I am, entertain me!*, then one ought to live in California.
Iowans tend not to have sense of entitlement that most Californians often exhibit.
I love the midwesterners, as I am one originally-conception-haha, I love em ‘cept for the radical religionists, but am finding those types are right next door too.
“Things he and his wife were longing to do, like ’settling down, having a home, raising a family -
What’s wrong with those things? Most people realize what is important in life after it is too late. I give this couple credit.
Catspit, you sound like a typical Californian. This attitude seems to be prevalent in CA. Affordability is so much greater in places like Kansas City, Austin, etc., but what is there to do there? I wonder what all these Californians do in their spare time that can’t be done in other states. Are they all surfers, or are they amateur seismologists doing research on the San Andreas fault?
I’ve lived in three different states and gotten to know people from all over this country. In my experience the most popular ways for Americans to spend their free time are watching television and surfing the internet.
This idea that there “nothing to do” in the areas with much better affordability is something that helps Californians feel that they are living in the greatest place on the planet, which is something that they apparently need to feel.
Ride motorcycles up the 1 to Big Sur for US GP, take in Monterey Aquarium. Then cruise cross state, check out Sequoia National Park.
Surf and swim in the ocean when you feel like it. Drive 2 hours to snowboard after school if you want to in the winter, or hike in local mountains in summer. Griffith Observatory Hollywood Bowl OC Performing Arts Center Mt Palomar Observatory are all things we did this summer that I did not do when I was growing up in KC.
From high school here, the kids who do well go to Stanford, Berkeley and UCLA. Not so much of that in the midwest.
Actually, there is probably a decent number of midwesterners at Stanford. Why wouldn’t there be? It’s an elite university which draws students from all over the country. I was an undergrad at MIT 25 years ago and I knew kids from Ohio, Wisconsin, Illinios, and Michigan. The high income suburbs of Chicago and Cleveland seemed to produce quite a few high-achieving high school graduates.
Some of the best universities in the nation, if not the world, are in the midwest — UIUC, Michigan, Washington (St. Louis), U. Chicago, U Iowa (one of the best med schools), Northwestern, Wisconsin, etc.
Generally, you can’t go wrong with a UC, Big Ten, or ivy league school.
Now, if you want a region with crappy universities, then the South is it. After Duke, Vandy, Chapel Hill, and GaTech, the quality drops off rapidly.
I’ve lived in many places in the US, including DC, and I can say without a doubt that the KC/Lawrence area was the best place I ever lived.
Catspit - i think what some of the other posters are saying is that if you work a job, or have a family, or both, you actually get to do very little of those things are you talking about - how many times a year does the typical californian do any of those things? They sound like vacation type activities to me.
But i guess if you want to structure your lifestyle around those things, you can make the time for them. I live very close to the beach and haven’t been there in a year - i hate the beach!
Agreed about the beaches. Southern Cali beaches anyways are just not what people believe they are. They are dirty (very dirty), crowded and the water is certainly nothing I would want to get in to.
I lived there 30 years and I can count on one hand how many times I had actually been ON the beach, in the sand, (including the 1 1/2 years I dated a guy whose house was literally on the beach.)
You want beaches - go to Hawaii.
I hear all the time that people don’t want to move from CA (particularly LA) because there’s so much to do here. Of course, when I ask when was the last time they did any of those things, they answer they haven’t, but they like the idea that it’s all available. Lots of folks used to do all those things- concerts, sporting events, museums, etc., but then it got to be too much hassle with the driving and parking and they gave up. They act like no other city has anything to offer. Seems to me, most people spend the bulk of their time working, taking care of their family, and sleep. I would much rather do those things in a place where there’s much less traffic, I can afford much better home and there’s a general lack of stress.
That is it right there. You really don’t have that much time to do anything after work anyway. Most of it is spent on the freeway going about 15 mph. Waste of life if you ask me and I unfortunatly didn’t catch on to that until I was 40. I can spend more time doing those things you speak of in California on multiple vacations now that I am not working for the house.
I do really miss the weather, or lack of I should say, but really a few months of crap weather is nothing compared to draining my life away working for the bank.
Now if I had, a house by the beach, low prop tax, real 8 hour only job, money in the bank, electric hybrid car, Nevada Residence (to avoid CalStateTax), then I would stay.
But really what do people in cal do different. They go out to eat/drink, go shopping…just like every other major city in the US. They just have more choices of the same stuff.
Yep I’ll say it again…don’t move here. It sucks. There are 49 other states one can move to. Go there.
I’m telling you! Let’s get the mass exodus underway!
AT crazy,
Come to Wisconsin!
Just kidding - although it’s awesome.
Many places in America are home - there’s no place like home.
Leigh
I grew up in coastal Orange County and spent most of my adult married life in San Diego. A little over three years ago we moved out of state. I was sad, we thought we’d never be able to afford to return. Eventually we relocated to Texas. We sold at the top and now we could afford to return but after several return trips to SoCal this past summer you’d have to pay us a lot to ever go back. We thought we might miss it but we don’t at all. The idea of being able to go to the beach or the Gaslamp (hip downtown area) always sounded good but we noticed we hardly ever went. (Hassels with parking, trash and Mexi gang wars etc.) I went to a Costco in Orange County in July and it was like being in the Tower of Babel, so many differnt languages being spoken, people weren’t friendly and everyone was rushing around rudely. Maybe it’s just the area but there is so much more emphasis on appearances too, with fake boobs, hair, tans and teeth, tats and logo whoredom. Where we live now is so much cheaper. And there are people out here that are very wealthy but you’d never know it to look at them. They don’t flaunt it. People here are so much nicer and more genuine. And the schools are so much better. You should see my son’s new $47 million high school. Here we have less traffic, friendly drivers and a lot less crime. It’s a much more relaxed lifestyle. All my favorite stores are close by but also a gorgeous state park. Lots of different cultures to learn about and museums to visit. A huge state to explore with a coastline though true, not as pretty as Florida or California. There are still lots of opens spaces, beautiful views, deer, space for horses or alpacas or long horns… We love it here. When friends visit they’re jelous. So Cal has lost its luster for us. I had an idylic childhood there but the area has changed and I don’t think it’s possible or affordable to recreate that middle class lifestyle for my children.
Well I walked up to the bar
I laid down my platinum card
Then I ordered 50 long necks for my new friends
Well, the bar maid passed them out
And before we chugged them down
I held mine up said here’s to us and them
Well, this blond slid up to me
She said that was awful sweet
Then I saw her boyfriend as wide as he was tall
Well he broke up our hug with a six foot five inch shove
And I found myself slammed up against the wall
Why does every body want to kick my ass
I’m just trying to have a little fun for all the ones who can’t
Just because I kiss the prettiest girls and drive my truck too fast
Why does everybody want to kick my ass
Well I’ve never been the type to walk up and pick a fight
I’ve always been the kind to get along
I throw parties all the time and there always on my dime
We drink and dance and smoke until the dawn
We’ll my style of stress relief sometimes disturbs the peace
The police show up put donuts in my yard
While the zeppelins playin loud they run off my party crowd
They cuff my wrists and throw me down so hard
Why does everybody want to kick my ass
I’m just tryin to have a little fun for all the ones who can’t
Just because I kiss the prettiest girls and drive my truck to fast
Why does everybody want to kick my ass
Just because I kiss the prettiest and drive my truck to fast
Why does everybody it seems like everybody wants
Why does everybody want to kick my ass
Kick my ass
You could play with your in Iowa City, Iowa.
Ack, pun ruined by bad html. That should read “You can play with your nads in Iowa City, IA”, with the link taking you to http://www.nads-sc.uiowa.edu.
“Rates, which have declined for almost two weeks, dropped as low as 5.875 percent Monday, said Jeff Tarbell, managing partner of Sacramento-based Comstock Mortgage. That’s down from 6.25 percent on Friday and back to levels last seen between January and May.”
“‘I’m calling people and saying, ‘I’m saving you $28,000′ (over the life of a 30-year loan). That’s a call I always like to make,’ Tarbell said.”
=========================================
Outgoing call from Jeff: Hey, I can save you $28,000, but you have to come up with $150k for a down payment…
Incoming call from Jeff: “Hey blah blah blah but you have to come up with $150k for a down payment…” CLICK
aladinsane,
True. That and the fact that these guys just won’t give UP will they? They’re as programmed as any inmate in the CA Penal System. After all that expensive rehabilitation you cut them loose on parole and before the week is out, they’re slingin’ rock.
Just, just quit it already. You can’t save yourself Mr. MB let alone some else so just… stop.
The other end of this is… Jeff’s phone is disconnected so he doesn’t answer the call. Or Jeff tells the realtard that he just lost his job.
The rest of the economy is going into the toilet. In addition to all the defaults on home loans due to high prices; job loss will crush even more people.
The debt situation is going to burn us secure folks when government spending slows down.
“I’ll save another $150,00 by waiting another year, thank you very much.”
“The graduate student”
Er, why is a graduate student buying a home ? Once your thesis is done you are going to be looking for a real job which most likely will be in another city
No kiddin’!!!
Why is a graduate student buying a home?
True story:
“Way back in the day”, my dad offered to pick up the tab for the down payment if I would buy a small place. Housing was cheaper than renting but only moderately so. I told him I didn’t want to deal with all the operational issues, and having the stress.
My officemate whose parents must’ve advised similar things (and was ahead of me) had bought a place. He was always stressed out. After he graduated and got a great job, he made a little money after expenses.
You’d have made more money sticking that dough in a CD.
Happened down the street and ’round the corner. Postdoc bought house in early ‘05 and sold it last fall. We, the exalted neighbors, don’t think there was much of a profit after the sale. ‘Specially when you figure the commish to the 6 percenter who listed the property.
True story. I got my degree at UCSC during the time period 1971-1975. When I was a freshman, one of the other guys in the dorm complained to his dad about dorm life.
His dad sent him a check for $20K and told him “so go buy a house”. He did. I think he put about 50% down. Houses were that cheap in Santa Cruz back then. He rented two of the bedrooms to other students which IIUC mostly covered the mortgage.
After he had graduated his dad sold the place for much more than he had paid for it: the profit more than paid for his son’s degree.
It’s hard to do such things nowadays. Timing is everything.
Given the inflation rates in the 1970s, profit is a slippery term.
I was in HS and college during that time period - $20k was a good size chunk of change. My first job as a chump engineer after college paid $15.6 k/yr back then.
For a somewhat forgettable town in the central valley, Manteca has more than it’s share of drama…
Well, you can’t bake a pie without cutting some lard.
BWAHAHAHHAHAHHAHAHAHAHHHHHHHHHHHHHHH!!!
most likely tortillas de harina that are the gustatory object; they never taste near as good made with veggy oil and rolled out Cal cuisine style as they did when granny used bacon grease and slapped them on her thigh. And actually Manteca has a very good central place location, probly very attractive going fwd to truck drivers and warehousing:
The Internal Revenue Service, in an unusual move growing from increasing gas prices, Monday raised the allowable mileage deduction rate from 50.5 cents a mile to 58.5 cents a mile for business travel. For miles racked up moving or for medical travel, the IRS moved the rate from 19 cents a mile to 27 cents a mile.
The increases will apply on 2008 tax returns for miles travelled between July 1 and Dec. 31. Miles from Jan. 1 to June 30 would be under the previous rate. The IRS normally adjusts the rate just once a year. At the beginning of this year, the IRS had increased it from the 2007 rate of 48.5 cents a mile.
Should you ever be in San Diego, a great restaurant beneath the Coronado Bridge: quatros milpas. They make flour tortillas con lard, and they’re muy sabrosa. You cook them on your gas stove flames and they puff up.
“‘I really think San Diego will be one of the first places to turn around,”‘ he said. ‘I don’t think we’re overbuilt. There still is a lot of demand for housing. We are getting to a point where prices have dropped enough.’”
Dropped enough?? Enough for what? For the hoards to come riding in and start buying up everything in sight?
This fellow really has no clue what’s going on, that is obvious. It’s like, OK it’s all over now just run out and spend some more money you don’t have, on things you can’t afford. With loans that are no longer available. What is happening in our financial system has never happened before. This is just another fool who should be jobless.
The sharpest contrast was found between La Jolla, Calif., and Sioux City, Iowa - the most expensive and most affordable cities, respectively, tracked in the study.”
“In La Jolla, an upscale seaside suburb of San Diego, the average price of homes tracked by the study was about $1.8 million. In contrast, the average price of a similarly-sized home in Sioux City was $133,459 - about 13 times more expensive.”
La Jolla is the crown jewel of the west coast. What they fail to recognize is that not only are you paying for a home, more importantly you are paying for the privilege of surrounding yourself with the denizens of La Jolla. To compare La Jollans to Sioux Citians is tantamount to comparing a graceful debutante to a drug addicted teenage prostitute. A debutante has beautifully flossed teeth while that teenage prostitute still probably has corn kernels stuck between her teeth. Personal hygiene is important and you can’t put a price tag on that.
That’s some serious snottiness there and the reason why homes in Clownifornication-land are outta whack.
Get real about Iowa. Broke down on I-80 there 20 years ago and met some of the most down to earth salt of the earth people. Mechanic fixed my car on Mother’s Day, then invited in the house to have a Sunday morning beer. He and the wife then told me about the loss of their son in Vietnam.
So, take that prejudicial, condescending crap and get out of here. BTW, I have lived in this moronic state for 22 years, more than half my life, so I am not some newbie to Clownifornia.
Attitudes like yours is why people hate CA.
whoosh!!
“met some of the most down to earth salt of the earth people.”
This is exactly what I mean. La Jollans prefer kosher salt and sea salt, not that earth salt which contains pesticides from farming. Even this concept of “earth people” doesn’t jive with the almost celestial like quality of La Jollans. And by the way, who drinks beer on Sunday morning, the Lord’s day? La Jollans have the most churches per capita and they will always wait until after church services for Sunday brunch before sipping their mimosas. I just don’t understand people sometimes.
Since when does the concept of “earth people” play swing music with La Jollans?
The word is “jibe”, not “jive”, Mr. Sophisticate.
I just don’t understand how people who have attended the nation’s most glorious high schools and colleges can make the most basic of errors.
I’ll try not to mix slang and proper english next time as I wouldn’t want anyone to misconstrue the meaning of a sentence. Just jiving with you jive turkey! Unfortunately I didn’t attend a glorious high school or college, for I am just a humble servant catering to the spiritual needs of La Jollans.
“proper English”
In my younger years when I worked in the restaurants (beach cities) I would meet alot of midwesterners out looking for there big break. They would all comment on how nice everyone was in california. I would warn them all to watch there back, california is about money first. Many went home broke from supporting their newfound California friends.
You must be speaking of non La Jollans. Those from La Jolla are not only generous in spirit, but monetarily gifted as well. My heart oftentimes skips a beat when I think of their insouciance…
Friar Juan,
I got engaged Easter Sunday 07 in George’s at the Cove (and yes, we did have mimosas!). Everyone in the restaurant applauded us, and were dare I say, regal in their countenance.
But the debutante/hobag comparison is a little harsh, even in jest.
I say it’s all good!
Congratulations DebtInNation. George’s is a fantastic venue for such an occasion. Do try out the Marine Room too, you will find graciousness overflowing there as well. I am salivating right now just thinking of those two places.
Regarding hobos and hobags, my friend’s grandfather was a hobo and genetically speaking, my friend cleans up quite nicely.
Amen Dan!
Friar, you can have an IQ over 140 and live in the midwest. My next door neighbor helped me fix my dryer when Mr. Jane was in DC. He was a gem so I invited him and his wife for dinner. Turned out he’s a senior Biotech researcher and his wife is a ag industry wonk who consults for some beltway types. Assuming that anyone not living on the coast is an idiot kinda makes you one.
IQ scores are for parvenus. La Jollans are concerned about proper breeding, etiquette, and how to treat others with genuine concern and kindness. A high IQ will only tell you what those words mean, not the spirit behind them. The love in La Jollans hearts make them idiot savants for love, think Alyosha in The Brothers Karamazov. Alyosha would have made the perfect La Jollan.
Did they start talking about how we’re gonna continue to kick the butts of the “terrorists” if we can just make sure the negro doesn’t get elected?
I lived in downstate Illinois for 20 years, so don’t tell *me* I don’t know the Midwest.
Another difference between flyovers and coasties is that the flyovers don’t put the word “terrorists” in scare quotes.
Enjoy your life with corn kernel girl, OCDan. I’m with friar john all the way. You kno’w, there’s a reason why some things cost more than others.
You must have encountered a La Jollan and been awestruck with their angelic appearance. It is quite breathtaking to have your own spirit get elevated by another person and that is the essence of La Jolla in a nutshell.
Is this guy for real? “Angelic” La Jollans? Give me a break.
Who wants corn kernels on their johnson afterwards? Surely not I.
There seems to be a lot of that attitude going around these days.
I’m a city boy, born and raised, who moved rural for the open space, clean air, slower easier pace, greatly reduced crime, and the land to grow at least some of my own food.
I’ll never completely fit in with rural culture since I wasn’t raised in it from the start. But I’m feeling increasingly estranged from the city culture in which I grew up, mostly because the type of condescension such as you just took to task.
I don’t remember my family, friends and neighbors ever holding hostility towards rural culture when I was young. We just happened to live in the city, and rural folks just happened not to. Now one group thinks they’re better than the other due to their life choices, which in the end, amount to little more than a particular style of “values consumerism”.
That is the problematic issue with Americans.
They think they are better than one another and others from other countries. I guess it is more obvious to me, cause I understand english, so if it happens in other countries, perhaps..me no understandy.no intiendo.
Early teenager, went from CA to Mesa AZ to visit ex neighbor girl.. all the boys and girls wanted to meet the girl from CA.
I guess it was encouraged by the Beach Boys!
“sunday morning beer.” that about says it all, doesn’t it?
La Jolla is on a whole other plateau. Laguna Beach is really nice. I recall seeing about 10 years ago, home price per square foot in La Jolla was something like 3x Laguna Beach. Wow. These are places I don’t like to hang out at…
Ah come on, OCDan, that was funny. He was clowning on La Jolla. You didn’t think he was really serious, did you?
I beg to differ. La Jolla is NOT that special. I’d take Montecito over La Jolla any day. Maybe 30 years ago it was special, but La Jolla has been bastardized by speculators and their tacky taste.
Perhaps Sioux Citians are equally offended by the comparison?
‘Tis a shame that wealth can’t buy class. Though apparently in La Jolla, that’d be a purchase of last resort anyway.
Wealth is such a pedestrian term, what La Jollans have is a treasure, not filled with gold coins as aladinsane would prefer, but with a knowledge of the good life that others continue to seek without quite knowing why they can’t attain it. It’s hard to explain to those who don’t live in La Jolla.
I knew you were pulling our collective legs. Friar.
LJ is pretty but antiseptic in a pretty way.
I would rather have a manse in San Marino.
“Kelly Cunningham, economist for the San Diego Institute for Policy Research, is…optimistic. The market should reach bottom by the spring of 2009, he said.”
“‘I really think San Diego will be one of the first places to turn around,”‘ he said. ‘I don’t think we’re overbuilt. There still is a lot of demand for housing. We are getting to a point where prices have dropped enough.’”
It’s not just about prices, Kelly, it’s about foreclosures…and those option ARMs and HELOCs are just starting to reset. Also, last I saw, the median price in San Diego is still about 4-5 times the median yearly income. You’ve still got quite a ways to go.
Won’t that skyrocketing unemployment and tourism slowdown put a crimp in your plans? Thankfully the bottom will be the spring of 2009, wouldn’t want another spring commission season to go bust.
wouldn’t want another spring commission season to go bust.
Oh… With the current state of the mortgage market, they have to be sweating. Oh wait… if they default its just a year+ of free rent.
Good thing the Alt-A resets won’t be that big of a thing… nor prime resets.
Got Popcorn?
Neil
So, then, this FredFan thing is suddenly going to Prevent all the foreclosures when the reset occurs?
Seriously, is it supposed to prevent those upcoming foreclosures?
I don’t see how, but you guys, hoz etc are way smarter and have better crystal balls.
My ‘gifts’? pulled into a del taco for burrito and got sprayed by family of skunks just removed from their mobile home that was being dismantled. Boy, you should have seen those men get out of the heavy equipment!!! And me rolling up windows quickly.
Can you say Car Wash today?
See, everyone, skunks included are getting ‘relocated’.
So, what do you think is the next shoe to drop? What financial entity that claims to be Supercalafragelisticexpealidocious is heading for the bone pile?
So, then, this FredFan thing is suddenly going to Prevent all the foreclosures when the reset occurs?
Seriously, is it supposed to prevent those upcoming foreclosures?
I don’t see how, but you guys, hoz etc are way smarter and have better crystal balls.
Pulled into a del taco for burrito and got sprayed by family of skunks just removed from their mobile home that was being dismantled. Boy, you should have seen those men get out of the heavy equipment!!! And me rolling up windows quickly.
Can you say Car Wash today?
See, everyone, skunks included are getting ‘relocated’.
“‘I really think San Diego will be one of the first places to turn around,”‘ he said. ‘I don’t think we’re overbuilt. There still is a lot of demand for housing. We are getting to a point where prices have dropped enough.’”
So unlike everywhere else, a large number of unoccupied new housing units is not a sign of overbuilding? Might real “demand” for housing be manifested in people actually trying to buy houses? And, of course, no economic basis whatsoever for why “prices have dropped enough.” JT…stat.
The Fannie/Freddie thing is all about bankers getting bailed out and all about bond holders getting bailed out.
Aint about preventing forclosures.
Meanwhile Ford/GM are going under. Guess we need to bail them out too.
On top of our 10T deficit.
How is this all supposed to work?
Rich Tuscano said it well, “This was not an attempt to make something happen, it was an attempt to prevent something from happening.
Will it merely delay that something from happening and by not that much?
Didn’t you get the memo? It’s $10T + F&F now, but we’ll make it back when the stock recovers!
Thornberg says we’re down 33% and we have a ways (17%) to go. Probably 2 or 3 more years to the absolute bottom.
“‘There’s a lot of merchandise, but there aren’t enough people out there who are buying it,’ said Terri Cooper, a manager at the story for 26 years. ‘We’re doing more auctions than we used to because we have so much to sell, but we aren’t making as much money as we used to.’”
Interesting. Do they take credit cards at these auctions or is it a cash only event? Buy now or be priced out of merchandise forever!
I know we’ve all complained about this before, but it still irks me that most newspaper articles devote 66-90% of their time to parroting real-estate agents, then maybe give 1-3 sentences to an unbiased source. It just numbs my mind that, after said “experts” have been wrong, wrong, wrong throughout this entire thing, they are still being treated with respect. Can journalists really be THAT stupid? What is going on here?
“Can journalists really be THAT stupid? What is going on here”?
That is one of the big problems, they are NOT journalists in the true sense of the word/profession. Or at least not the way they once were. Today they are more like a glorified note taken.
The average journalist nowadays has the depth of a kids wading pool, as far as breadth of knowledge goes…
They have a rather unenviable task, as they are pitted against us, who can say whatever we want, and we earn no salary for our efforts~
Speaking as someone who considered entering the journalism field, I can say yes, they really are THAT stupid.
I object, Slim. My daughter’s goal is to be a journalist. She has a tremendous intellectual curiosity and terrific critical thinking. She attends one of the most difficult colleges based on the great books and hopes to go on to grad school in journalism. Granted she wants to be a science writer and make science interesting to the masses, so that’s not your average goal, but we need people that still want to be journalist and can make a living at it. I don’t think the problem is the journalists as much as the publications and the public. Have to keep those stories short and include lots of visuals in order to get ratings, to get advertising, to stay in business.
Maybe all of you already noticed, but the Real Estate section of the Sunday LA Times has disappeared. Now it is one page at the back of the business section. At least one biased source of info has gone under…
The great newspaper the Los Angeles Times, sadly no longer exists. What has replaced this once wonderful newspaper is something only marginally higher than the Daily News (San Fernando Valley). I was shocked at how many crappy ads were contained in the “A” section last Saturday. The Chicago Tribune company finally found an Editor who would make the cuts they demanded.
True journalism in this country is severely under attack. Each of us should be very concerned because you need a free press to call the government out when needs be.
I have noticed this and it pisses me off. I wanted to see that section of the newspaper now that everything has gone to crap, but of course now it is gone!
“newspaper articles”
don’t read those things anymore , I hear they are all going broke so they need the money from the RE crowd.
Levengers is offering 20% off entire order in latest e-mail if I buy something within a few days. I don’t think they have ever gone above 10% before.
Fountain pens and overly complicated wallets must be a shrinking market.
Man, talk about overly complicated. Their website has more div tags than you can shake a stick at.
Where is joeyincalif?
I was wondering the same thing myself Big V .
is considered income by the Internal Revenue Service and State Franchise Tax Board that the individuals being foreclosed on are still liable to pay.”
You know, I am really getting tired of hearing this…. My thinking, any good attorney should be able to shoot so may holes in this as to be laughable.
Biggest hole, OK. Look bank, I agree I cannot pay my loan, and have to be foreclosed on. BUT bank, I have tired to in good faith sell this assist that YOU said was worth so much more.
IF the bank sells at less than this price, why couldn’t a lawyer says the BANK dumped it, and would in fact still OWE the mortgage holder the price to make up the diff???
The mortgage holder didn’t buy the house from the bank. All they did was borrow money from the bank, using the house as collateral. If the debtor defaults on his repayment terms, the bank gets the house, and can do whatever it wants with it.
I am saying the Bank was supposed to know all about price of collateral . If your home was taken back [ or given back] and the bank sold a home that might have been priced at 500K and they sold it for a dollar, and came back to you though the IRS. YOU don’t think you would have a case of Mismanagement on there part?
The bank has to sell for market price. If you owe more than market price on a recourse loan, then you are liable. If you disagree with the amount that the bank sold the house for, then I’m sure the judge would like to know why you didn’t sell it yourself.
I would suggest the person buy a copy of “Cracking the Code” by Peter Eric Hendrickson. Terms like “Income” “wages” and even “employee” and “employer” have always had a very narrow legal definition in the law and IRS code. The IRS wants us to think they use those terms the same way we use them in everyday language, but actually, each of those terms is defined clearly within the internal revenue laws and the regulations that are referenced by the code. And they don’t apply to most of us. Basically, the IRS is 95% bluff and gets away with what they do because Americans are woefully ignorant of the Constitution, the law, and pretty much everything that’s important. Someone once said, you can’t be both Free and Stupid. It has to be one or the other.
I wonder why a myth is around that a borrower does get off the hook on the tax on a foreclosure verses a short sale . I would imagine that a attorney could prove that a bank did not get the highest and best price the market would bear ,but in a declining market this might be hard to prove . I’m just wondering who would be responsible for the fact that a property was damaged after the property was foreclosed on that resulted in the property selling for less . I could see that a borrower that was foreclosed on who didn’t damage the place could argue that they were not responsible for the trashed property . And wouldn’t the bank’s insurance pay for damage that was done by squatters or vandals?
I remember on the foreclosure right near me ,the second the bank took the property they sent someone out to take pictures of all rooms in the house and the yard . I’m sure this procedure is for some protection concerning liabilities .
Try to use those definitions and you may come to regret it. A trial will often ding the IRS on penalties when they are asserting that someone did something “knowingly” because, it is darn hard to prove what a person actually knew at a particular time, but they also side with the IRS on the taxes owed.
And be sure to look up the current list of “abusive tax avoidance transactions” before you try.
This is all conjecture on my part because i can see that the IRS issues regarding real estate foreclosures can get real nasty because of how extreme the crash in prices were .
Fail to stand up to the gangsters at the IRS and our abusive government and your children and grandchildren may come to regret it.
OK. I like knowing what’s what. So I Googled the author’s name. There is much to know. Specifically, the DOJ brought lawsuits against the author and nine of his followers and prevailed.
I work in a position affiliated with gummint. My security clearance re-ups consider - among other things - whether or not I have filed returns in a timely fashion. It appears that those who administer the gummint take this reasonable faith and effort thing seriously. I think I get a lot for my tax dollar, despite its attenuation by future promises to pay. I think I will just call this one - taxes - my ante.
Lest I sheeple myself, read back what happened in the last Depression. Those in the so-called “free market” economy had 25% unemployment. The gummint introduced job sharing, kept the workers, and instituted the Civilian Conservation Corps etc. etc. to spread the wealth. OK, General Pershing did open fire on the day’s equivalent of the million man march in D.C… What can I say - it’s a world with shades of grey.
Point is - Can I still eat on half pay? You betcha. Can I, 104 lbs and in my fifties, slug it out on the street? Not so much. Not even in the company of my elderly Akita.
Expose my comfortable anonymity by appearing in the crosshairs? No thanks.
“OK, General Pershing did open fire on the day’s equivalent of the million man march in D.C… What can I say - it’s a world with shades of grey.”
It was General MacArthur, and nobody “opened fire,” unless you count tear gas grenades, but aside from that, you’ve kinda got the story right.
From the original post:
“The city took emergency action Monday afternoon in boarding up an ‘abandoned’ home at the corner of Pestana and Falmouth avenues after finding two teens - a boy and a girl 15 and 16 years old - inside the house they said was filled with human feces.”
“The teens were escorted by Manteca Police officers to their high school classes shortly before 10 a.m. Monday.”
Nothing like fixin’ to be makin’ whoopee in an outhouse.
and it only took them a year to do anything , way to go Manteca !
I probably don’t want to know why a house filled with feces would be preferable when so many others are available.
Squatter sex in Manteca, surrounded by feces…
Does it get much better than that?
Can you imagine the scene at the school when these two kids arrived? I can just hear the classmates saying, “Dawg, where ya been? You smell like s—!”
Is this FredFan thing is suddenly going to Prevent all the foreclosures when the reset occurs?
Seriously, is it supposed to prevent those upcoming foreclosures?
I don’t see how, but you guys, hoz etc are way smarter and have better crystal balls.
Pulled into a del taco for burrito and got sprayed by family of skunks just removed from their mobile home that was being dismantled. Boy, you should have seen those men get out of the heavy equipment!!! And me rolling up windows quickly.
Can you say Car Wash today?
See, everyone, skunks included are getting ‘relocated’.
sorry if this Finally comes through. Blog Hungry, Eating lots of posts. Ummmm
“I ain’t an athlete, lady, I’m a baseball player.”
John Kruk (While puffing on his cigarette)
I’m not smarter and have no crystal ball, I’m a simple country boy with horse sense. I don’t drink water from a tainted well.
Blog Hungry
Eating lots of posts.
Didn’t say the word s,h,i,t so it should have worked.
We’ve been asked to avoid curse words, which seems a reasonable request given the high utility of this blog and the genuinely dry nature of properties and prices as subject matter.
test
Well it looks like some of my posts did get by, but much much later. And I didn’t say s,h,t etc, I was just kidding around.
Looks like they finally showed up.
Sorry gang.
“Like the housing market, the local auction industry has become a buyers’ market.”
“‘There’s a lot of merchandise, but there aren’t enough people out there who are buying it,’ said Terri Cooper, a manager at the story for 26 years. ‘We’re doing more auctions than we used to because we have so much to sell, but we aren’t making as much money as we used to.
========================================
I’ve been to perhaps 500 auctions in my life, and as eBay became a quite viable vehicle to sell collectibles about 10 years ago, I noticed lots of new faces appearing @ various venues where there used to be competition only amongst longtime dealers, and it got to be much tougher to buy things, quite honestly.
Now that eBay is dead, and other ways of selling things are just as moribund, i’d imagine stuff is going for next to nothing~
A great “absolute” auction if you’d like to get your feet wet, is the L.A. Public Administrator Auction held once a month in beautiful (not!) Pico Rivera.
We always called this one the “dead people’s auction”, for if you die in the city of angles without an heir, your worldly possessions end up here…
OK, I know we all agree that credit is really tight compared to a couple years ago and that home prices have fallen, but in LA I’m still constantly seeing houses sell at wtf prices. A small 3/2 in Westchester just sold for over $800k. Yes, that’s a little less than they could’ve gotten for it a year or so ago, but still… wtf? Where is this $$$ coming from? Are people still waltzing into banks and getting $750k loans? Is funny money still floating around? And seriously, when will the madness stop? I have no intention of buying anytime soon, but this is just completely insane.
“Where is this $$$ coming from? Are people still waltzing into banks and getting $750k loans?”
Erm, that bailout over the weekend? F&F will continue to buy conforming loans, because Uncle Sam sez: “They’re good! It’s all good!”
Is anyone ready to start a recall committee for Blarney Fink?
Well, of course it’s not gonna go from noon to midnight without a little time passing first. Your opportunity will come, probably sometime between 2010 and 2012. Try not to think about it too much until then, and keep HBBing just to keep your sanity.
I have a hard time believing that anything in Westchester would top $200k, let alone $800k, but then again I lived in LA through the mid-1990s, when Westchester WAS that cheap, and deservedly so.
I am seeing the same thing in the 90803 area of Long Beach. A townhome in Bixby Village just listed for $669,000 and sold within a few days. The top of the market these were selling for $750,000. I also wonder who the hell is buying . Am I’m missing something? Lot’s of pendings and closings
“Code enforcement officer Greg Baird said he cited the owner for having an unsecured structure several months ago noting that nothing has happened to correct the problems since then. The water was turned off two years ago and the house has been unoccupied since except for trespassers making use of a lone couch.”
Ten bucks says this house is owned by a Bay Area “investor.” Thus far the Bay Area proper has held up reasonably well because people are mostly giving up their investment properties first. But when they run out of ballast to jettison, the Bay Area downturn should start in earnest. I give it another 12 months, max.
As per Googlemaps there is no Falmouth/Pestana intersection in Manteca.
Maybe the Manteca Bulletin didn’t realize who The Onion was when reprinting their story?
I guess the whole point is that if the market has more confidence that the government is going to be involved in bailing out any loss on MBS’s ,than secondary market investors might be more willing to provide cash for
loans . The same confidence can be achieved by insurance on loans and of course good underwriting and appraisals .Of course all loans are at risk in a declining market ,so that is the real reason for the lack of confidence .
Actually ,I think it would be a false confidence anyway because no one could say when the government would allow loss or when it wouldn’t .Is the government going to take taxpayers funds and now use that for loan
funds verses private money ? I guess I’m thinking that anything might be possible in the future if the powers decide to vote to do it .
“Actually ,I think it would be a false confidence anyway because no one could say when the government would allow loss or when it wouldn’t .”
I am guessing some BSC and FNM investors learned that lesson the hard way earlier this year. It seems more and more like investing is a matter of guessing correctly what the government is going to prop up and what it is not. I guess this boils down to being able to distinguish the too-big-to-fail financial entities from sh!t-out-of-luck financial entities?
Within the GSEs, it apparently boiled down to separating the assets classes with implicit guarantees from those without.
Does anyone have a list of assets that are backed by the full-faith-and-credit of the U.S. government?
Hey guys -totally OT, but I thought I’d poke my head round the door and say ‘hi’ to y’all.
Been away in the news-blog universe for the last couple of weeks watching the conventions, and am now on a long road trip with the husband from L.A to Vancouver.
Oregon has some of the most beautiful beaches I’ve ever seen, but some of the worst drivers- had two ‘road rage’ incidents going along the 101 today, too long a story to tell, but I wouldn’t like to be vacationing near Lincoln City on the 4th July. If its as crowded as this on the week after Labor Day, gawd only knows what its like in mid-summer….
Anyway, all along the coast - literally - every other place is for sale. All the way from northern CA to Long Beach, WA (where we are now) there’s “For Sale’ signs littering the sides of the highway.
I asked the owner of the cottage we’re renting about it, and he said ‘oh, its because Long Beach has lots of retirees - one one dies, the other moves back to the family’. I thought ‘not’ to myself, as its not just here - but it really is amazing how many vacation homes are up for sale here in the PNW.
Anyway, apols for the rambling and bad spelling/grammar - one too many glasses of Merlot sitting outside on the porch. I’m listening to the dull roar of the sea in the distance, and have to remind myself that it’s not noise pollution from the 405.
Later!
“…if the market has more confidence that the government is going to be involved in bailing out any loss on MBS’s ,than secondary market investors might be more willing to provide cash for
loans .”
I could see this being the case in the short term (next 2 years), but long term isn’t the govy trying to unload these positions and get out of the loan guarantee biz? What happens then?
I think the next step will be the government actually providing money for
new loans to try to re-spike the punchbowl ,if needed of course .
Actually sleepless ,whatever intentions or plans that the decision makers are making now could change if plan A or B doesn’t work . But ,it seems apparent that the government is not into the idea of letting the markets
sort this all out the good old fashion way .
“The city took emergency action Monday afternoon in boarding up an ‘abandoned’ home at the corner of Pestana and Falmouth avenues after finding two teens - a boy and a girl 15 and 16 years old - inside the house they said was filled with human feces.”
Holy sh!t… Add this to the list of problems due to having so many unneeded vacant homes dotting the landscape. And now that the Fedsury is in a position to backstop prices for the entire housing market, I guess we can expect builders to supply more overpriced vacant homes to the market going forward.
Seems like gold bugs are losing the faith…
5:04 a.m.
December gold futures down $14.00 at $778.00 an ounce
People need cash more than they need gold.
The run up in gold was, basically, what we call a “bubble”.