Bits Bucket For October 4, 2008
Please visit the HBB Forum. Post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
November 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
Old Paulson Plan: 3 Pages
New Paulson Plan: Fahrenheit 451
I think we should have an over/under competition to see who can pick out the real amount that will be spent to purchase all those nasty MBS’s.
Oh, MBS’s only. No fair lumping in the cost of all the bad paper that the Gov’t. will be cajoled into picking up for bad auto loans, bad credit card debt, etc.
What temperature do computer blips combust at?
11.3 trillion degrees of indebtedness.
touche’
Computer chips = silicon = sand. You need a nuke to liquify sand into glass.
“Financial weapons of mass destruction.” - Warren Buffet
Will that work?
How can we exploit the flaws in this plan? What companies stand to gain the most? Goldman? Wells? BofA? Citi? JPMorgan?
They are all just bigger bettor Giant Sequoias about to take a fall…
Use them to make paper.
Nice loop closure!
Our Federal Reserve notes are actually made out of cotton. Those Sequoias would die in vain.
King Cotton
Go long cotton, ink, printing press mfgs…
X X X X
X X X X X X
X
(Yellow-Dog 24, everybody go deep and get open)
(formation snafu)
X. X………………………………………..X. X…
………………….X. X. X. X. X. X………………….
…………………………X…………………………
(hike!)
Assuming all banks get equal play in unloading their bad debt, I would think all banks are a buy. Why would they not be?
I think you hit the key ones.
I posted some time back a list of friends - the real Powers That Be, that pretty much includes key executives from all these firms, except Wells Fargo, which is part of the reason why I think Wells Fargo probably won’t end up coming through this unscathed.
http://en.wikipedia.org/wiki/List_of_Bilderberg_attendees
Yes, I am a conspiracy theorist.
Good question MrktMaven. At the momment it looks like the dumbecrats will win this election with the mantra of building the economy from the bottom up. What are the best investments in a return to a Welfare State?
Short the losers, perhaps health-care, energy, and military. Go long green. What’s more, the national debt doubled over the last 8yrs. Where did all that welfare state money go? Watch and adjust accordingly.
My sister is pulling down major clams overseeing a thousand minions in the weaponry biz and she thinks she’s bulletproof and she very well may be, but what a surprise if the tall timber is the first thing to go, when downsizing the war becomes job number 1.
I’ve got a BIL that has experienced a windfall the past few years due to Iraq. He acts like his income is at a permanently high plateau.
Two questions about implementation of the $700 bn bailout:
1) Will it include an explicit attempt to prop up U.S. residential real estate prices?
2) If yes, what will be the effect of the bailout on the behavior of the U.S. residential real estate market?
The residential real estate market is but one leg on a collapsing table. Unless they can restart the Debt Machines, it won’t matter.
Very well said.
There is simply no way to prop up residential real estate prices short of a hyperinflation in wages. Period.
Wall Street Journal
* OPINION
* OCTOBER 2, 2008
First, Let’s Stabilize Home Prices
By R. GLENN HUBBARD and CHRIS MAYER
We are in a vicious cycle: falling housing values cause losses on securities, which reduce bank capital, thereby tightening lending and causing house prices to fall further. The cycle has spread beyond housing, but housing is the place to fix it.
Housing starts are at their lowest level since the early 1980s, while there are more vacant houses than at any time since the Census Bureau started keeping such data in 1960. Millions of homeowners owe more on their mortgage than their house is worth. Foreclosures are accelerating. House prices continue to fall, weakening household balance sheets and the balance sheets of financial institutions.
But this can stop. The price of a home is partially dependent on the mortgage rate — a lower mortgage rate raises house prices.
We propose that the Bush administration and Congress allow all residential mortgages on primary residences to be refinanced into 30-year fixed-rate mortgages at 5.25% (matching the lowest mortgage rate in the past 30 years), and place those mortgages with Fannie Mae and Freddie Mac. Investors and speculators should not be allowed to qualify.
P.S. These guys are either liars, or they don’t get the picture.
I have been watching one of the nicer homes in my hometown. It has an indoor pool. That is almost unheard of. In fact, I don’t really know of another house that has an indoor pool in my hometown.
Last year the house was priced at about $340,000. It is 3,500 square feet and looks like it has been completely renovated. It is an old house that looks fully up to date. They have had the house on the market for a year or more. They have been dropping the price much more aggressively than other houses languishing on the market.
Recently the house was priced at $275,000. That is for 3,500 square feet. Other dreamers are still looking for $150 - $200 per square feet.
Last night I saw the house was now “Inactive” on ZIP. I thought that it might finally have sold. Nope. It is relisted. It is now listed fresh at $257,700. I would almost like to fly back home and ask these people what they are going through mentally. There is a documentary in there somewhere. Another house that I have watched for about a year looks nice and is down to $175,000 from $230,000.
I know there was no bubble in the Midwest but those seem like real price declines on what I consider decent houses. Some houses still seem to be selling. I just wonder why, without such massive reductions.
Oh, plus there was a condo development in my hometown built in 2006 or 2007. Condos in my hometown is about as appropriate as having Pamela Anderson flash her beaver in St. Peter’s at midnight mass on Christmas Eve. The condos had been priced, with great disconnect from reality, at $220,000. They are now $114,000. No bubble existed in the Midwest. I keep telling myself that. I’m good at lying to myself. I still believe that size doesn’t matter. Seriously!
They are liars who won’t admit to getting the picture
Ask Barney and Maxine Walters. They want to bring back Nehemiah loans.And restart 1& 2% interest with stated income. hehehehehehe
–
Inflationists Please Note: Commodities Down Across the Board (Worst Week In 50 Years)
DJ-AIG Indexes 3-Oct Week YTD
Commodity Fut 159.017 -10.1% -14%
Total Return 318.25 -10.0% -13%
Energy 248.814 -9.5% -7%
Petroleum 462.175 -12.5% -3%
Livestock 46.355 -6.0% -19%
Grains 55.3 -14.5% -21%
Industrl Metals 156.54 -9.5% -18%
Precious Metals 119.386 -8.6% -9%
Softs 48.089 -9.8% -20%
Gold 835.5 -5.6% 0%
As I have said repeatedly gold will out-perform all commodities and it is a currency and not a commodity like silver and platinum are. Here is my flow chart from early 2008:
US Recession — > Commodities Bust (WE ARE HERE) — > Depression — > Deflation — > Greater Depression.
Jas
It seems to me like the Fed is doing a credible job overall of keeping the economy suspended in mid air between the forces of inflation and deflation. Of course, individual asset classes will tend to break the overall price trend (e.g. housing and commodities price deflation)…
It seems to me efforts over the past 30 years by the Fed to keep inflation at bay have created a sort of pressure cooker effect. Not sure what the answer is, but market manipulation appears frought with laws of unintended consequences. That said, I do believe the US economy is in process of a catastrophic and historic collapse. I believe the current bailout while onerous, has deferred that collapse to another day. I noticed Arnie is out begging for 7 billion. The State of Ca must realize it has to exist within it’s means. Debt is our enemy here. Debt in all it’s forms.
$arah Connor?
Won’t be renewed this season.
What is this, the gov’t writes a 700B check, a half point rate cut is pretty much baked in, CNBC talking heads are already calling for another “package”, and au falls? Sheesh, there really is nowhere to hide. Commodities, stocks, cash, all going down.
“COMRADE lainvestorgirl”
*****
I say: “THAT is a good one!”
Inflation kept at bay? What powered the exploding prices of houses if not an inflated money supply?
The economy in general was financed by this inflation; now that the money borrowed into existence is vanishing due to write offs and bankruptcies the economy will contract accordingly.
Money creation is still running wild but on the other side of the ledger is credit destruction. So, we need to determine which will have a bigger impact on the economy. Even if money creation goes up by 20% per year can it make up for the trillions of dollars of credit destruction, in the form of HELOCs, credit cards, student loans, car loans, that is taking place?
I’m starting to lean towards that deflation argument since I don’t think anything can replace all of the credit that is being destroyed.
“I’m starting to lean towards that deflation argument since I don’t think anything can replace all of the credit that is being destroyed.”
There it is.
NYC, I agree in the short-run, credit destruction is huge now and will cause general price decreases.
In the longer run, as tax revenues go down, the govt will have a harder time paying the bills. They will then have to:
1) Default - very low probability event as long as they have other options
2) Tax more - higher probability, but still subjectively low. Higher taxes are unpopular. They will do some of this for sure (tax the wealthy) but eventually this well will run dry. Also govt will continue to increase spending, likely off-setting any benefits from tax increases.
3) Inflate - eventually we will hit the point were this is the last viable option. When that point comes, it will be a hyperinflation scenario, imo.
I’ll add that I agree with Jas’s timeline, except I feel he is leaving out a late-stage hyperinflation scenario. We could even see $500 gold and $60 oil before it’s over, but that won’t be the end-game.
The vast majority of credit being created right today is from the treasury and federal reserve. That is why our leaders are so desperate to bail out key banks who lend to businesses and consumers.
The consumer is facing money destruction on all sides, and will ultimately get the bill for the bank bailout. Since the consumer represents two-thirds of the economy, I say the destruction of credit and money is overwhelming the economy.
The last viable option is upon us, and that is raw printing of the currency. And conveniently, M3 is no longer reported. Nevertheless, we’ll see the effects immediately in unchecked inflation. If they were going to let the system deflate, then there wouldn’t have been injections to the tune of $1.5 TN so far or there wouldn’t have been a universal hysteria demanding that Congress approve an additional $0.7 TN bailout. The choice now is let the system deflate and watch the entire system collapse, or try to keep it going through helicopter money drops. It’s pretty clear to me which path the government will choose. Just ask any Argentinian. Deflation won’t happen.
“We could even see $500 gold and $60 oil before it’s over, but that won’t be the end-game.”
Before it’s over? Heck, at the current rate of decline in commodities, we could see that in a few weeks time. Not saying it’s probable, just possible.
The tragedy of Arnie is that he clearly understood the problem of CA State deficit financing before he took office. Despite advance awareness of the pitfalls of getting into a financial hole, CA is now stewing in the boiling pot of a $15 bn deficit.
$15B? That’s nothing! I’m quite sure the government has that in pocket change. Not to worry.
Arnie “clearly understood”?
I think that could depend on one’s definition of “understood”, no?
No, there is a time delay before loans go bad, capital is expended, unemployment runs out… You are just seeing that time delay before the inevitable.
Like we saw with all the bad loans and lending practices. As treasuries and government debt get rolled over, we should start seeing upward rate pressure. Not sure on the key dates for treasury auctions… 3 month, 1yr exc.
If China/Japan decide to keep buying debt than this will go longer. It also pushes us closer to hyperinflation.
I’m putting this out there… A lot of people were claiming that we the people didn’t understand what would happen if we didn’t pass this bail out plan. I’m sure most of us do. Bank failures and liquidation of bad debt… possibly rapid deflation causing unemployment to skyrocket to 30%.
On the other side of this equasion we take a significant move to hyperinflation. Hyperinflation quickly results in 100% unemployment and martial law.
I can’t say how stupidly dangerous it is to put ourselves into a position where divesture of currency reserves would cause hyperinflation. Risks are now more likely and consequences worse. Might have to cut off all debt payments to places like China and kill all international commerce if this occurs.
Hopefully, and its faint hope, the money will go twords increasing production and we make some progress tword working down the debt.
That’s my take. I don’t know much about the world economy, but it seems to me that the Chinese already realize they can’t sell us their crap forever in return for increasingly devalued paper. What’s to stop them from dumping at least some of that paper, perhaps a shot across our bow, and buying up a bunch of gold instead?
If that’s the case, plus hyperinflation, I would think gold would climb to $ 1500/$ 2000 per oz, not down to $ 500.
China can only fund our increasing debt (+1 trillion more than normal with bailouts) if they keep up their huge trade surplus. But that’s a big IF! We are heading into a serious recession and we won’t be buying as much crap from them. They are already seeing a huge slowdown in exports. Our gov will also see a big drop in tax revenues, just like California is feeling. So what happens to all this debt our gov is trying to issue? Who is going to buy more treasuries? Japan, China, even the Middle East are going to see fewer dollars coming to them. I’m guessing that bond interest rates will start ramping up and we see an acceleration of credit/money destruction.
This is the dilemma that China faces. If they say ‘no mas’ to our debt and pull the plug, we go down the toilet and take them with us. All that debt they own will be worthless and it tanks their economy too. If they keep funding our debt, then there is an outside chance they keep cheap credit available and the US consumer keeps buying their exports. The problem is we are approaching insolvency in both our consumers and eventually our gov.
We talk about debt to income ratios on this blog quite often. 3:1 is doable while paying back interest, but much higher than that makes us all wince. Well guess what. 2.5 trillion in tax revenue last year and we have 11.3 trillion debt with the bailout. We’re getting near 5:1 and our interest payments are still quite low, but they are adjustable. How many more times can we cash-out refinance?
Obama/McCain has to think long and hard about new gov spending, tax cuts, and further bailouts. While inflation would help our debt situation, when has WAGE inflation ever happened in a recession, especially while deleveraging? We are running low on options where things don’t end very very badly.
IMO, we are already seeing rates rise. Those that aren’t are being directly subsidized by the govt.
It (rising rates & price deflation) has finally begun…rejoice! Let’s just hope the govt is too weak to offset it (though they will try).
You have to take into account, that China can only fund our increasing debt (+1 trillion more than normal with bailouts) if they keep up their huge trade surplus. But that’s a big IF, we are heading into a serious recession and we won’t be buying as much crap from them. They are already seeing a huge slowdown in exports. Our gov will also see a big drop in tax revenues, just like California is feeling. So what happens to all this debt our gov is trying to issue? Who is going to buy more treasuries? Japan, China, even the Middle East are going to see fewer dollars coming to them… I’m guessing that bond interest rates will start ramping up and we see an acceleration of credit/money destruction.
This is the dilemma that China faces. If they say ‘no mas’ to our debt and pull the plug, we go down the toilet and take them with us. All that debt they own will be worthless and it tanks their economy too. If they keep funding our debt, then there is an outside chance they keep cheap credit available and the US consumer keeps buying their exports, so they can loan it right back to us. The problem is we are approaching insolvency in both our consumers and eventually our gov.
We talk about debt to income ratios on this blog quite often. 3:1 is doable while paying back interest, but much higher than that makes us all wince. Well guess what. 2.5 trillion in tax revenue last year and we have 11.3 trillion debt with the bailout. We’re getting near 5:1 and our interest payments are still quite low, but they are adjustable.
Obama/McCain has to think long and hard about new gov spending, tax cuts, and further bailouts. While inflation would help our debt situation, when has WAGE inflation ever happened in a recession, especially while deleveraging? We are running low on options where things don’t end very very badly.
I don’t think the Fed is doing anything other than coasting along at the top of the parabolic arc, just like the rest of us.
-> Greater Depression -> ???
You left off some.
“-> Greater Depression -> ???”
“You left off some.”
By the time you get to that point, wouldn’t increasing non-economic factors come into play with lots of possible not-easily-predicted outcomes (see 1930’s)?
Yes.
The point I was getting to is that those non-economic factors are inexorably tied to economic factors, e.g. there’s a good chance the dollar will go bye-bye in a destroyed political system, thus then we have the (extreme) opposite of deflation.
US currency is up how much against the Yen, Ringitt and Yuan?
As long as you pick bubbled assets collapsing and expect that to represent a “general decline in prices”, you will keep picking the wrong data. Currently disinflation, not deflation.
“Why is the dollar strong?
Bank X, a foreign bank takes $ deposits and invests proceeds in $ assets, sadly these turn out to be toxic. Bank X dumps the toxic assets, takes the loss. What do they have to do to make the depositor whole ?
BUY $
$ will gain against EUR and GBP, not JPY.” Alea
Europe is toast, that does not mean the US is strong.
Since you do not follow anything but prices, you have no idea how many funds were forced into liquidation last week. Traded commodity prices were lower. However the market in spot is unchanged.
Current price Cobalt $36.25/lb last October 25.50/lb (2 yrs ago $12.50/lb)
Iron ore is still up 65% over last year.
No matter what happens in the US, China is still going to grow. Its growth may come down from 10.5% to 8%. This will seem like a recession in China. It will keep prices higher. The US is not the largest importer of Chinese goods. China is still exporting at 10% growth with a 17% increase in price.
In the meantime, the US just authorized $1 Trillion in new moneys. And has already added almost $2T into the economy since last August. The US will continue to add moneys. Belief in anything else is foolish.
Never before has the US authorized the issuance of more than $1.3 Trillion in bonds in one quarter. (250 B F & F; 805 B “full employment act for fired investment bankers”; 270B ordinary government operations).
Why do you assume China is going to grow? China is full of problems. I guess they will keep selling to us at a huge loss.
That makes sense.
We make up some 30% of their sales. You don’t think a massive slowdown would effect that?
China also exports tons to Japan, which in turn exports to the US. There is no way China grows if US hits a recession. We feared Japan would launch itself in the 80s too, no dice they had 15 years of recession instead.
Oh, and hows that Chinese stock market doing this year? While there are many issues with their market, it is down far more than ours. We’re all holding hands right now, and China is almost as scared as we are I suspect.
Hoz, I am requesting a straight answer:
Are you long Yen and short a basket of Asian bonds?
this is a funding question.
One thing that should probably be inserted just after the “WE ARE HERE” is attempted reinflation via unabahsed printing of fiat dollars. There has never been a government with a fiat currency that hasn’t tried to hyperinflate out of your flow chart.
“As I have said repeatedly gold will out-perform all commodities and it is a currency and not a commodity like silver and platinum are.”
Keep an eye on silver. It’s real money too!
The inflation/deflation aspect is really confusing and interesting me simultaneously. Just like how cats love to be annoyed, I guess.
Anyway, this was linked to vancouvercondoinfo. I thought it was interesting (apologies for the length). In fairness, I have not followed the londonbanker blog myself, and I cannot vouch for its accuracy, and I am not familiar with its biases.
http://londonbanker.blogspot.com
A factor which is probably critical but has received little discussion is that literally thousands of Bush administration apparatchiks will need jobs come January, and a fair selection of GOP House and Senate legislators and their aides too. What better way to enahance their CVs in their final months in power than to distribute $700 billion or so in pre-Christmas largesse to the most remunerative employers in the world? And what better way to ensure the corporate largesse is returned to the GOP to win back the White House and Congress in 2012 as the recession fuels public anger?
And then there is a huge arbitrage opportunity as well so that everyone makes money for years to come. According to the conference call, the pricing on offer from the Treasury will be a bit below Level 3 pricing. The toxic assets will be repackaged and resold with a new AAA wrapper, possibly priced well below what the Treasury paid, assuring a huge profit on both immediate liquidation by the banks and ultimate maturity by investors. The Fed gets its cash and Treasuries back; the banks make huge profits; the foreigners and off-shore tax avoiders get disguised ownership of the American financial system; the taxpayer gets ripped off. What’s not to love?
Think back to Fisher’s Theory of Debt Deflation in Great Depressions. Dollars become “bigger” as deflation takes hold because each dollar can buy more assets as assets deflate. That means that as these clowns crash the markets, their $700 billion of liquid cash funnelled to their friends and recycled through the Treasury laundrymat can progressively buy up the rest of the pieces on the gameboard at low discount prices. Game over with those who caused the crash and robbed the bank winning.
Deflation is going to happen – globally. Either we can use the course of deflation to shape healthy economies that will provide growth and employment and productive returns on investment in future, or we can allow deflation to further enrich those miscreants whose irresponsible policies led to the violent financial collapse we are about to experience.
There is a fundamentally healthy economy in America – somewhere underneath all the financial excess and chicanery and all the financial/oil/military/healthcare/developer corruption of local, state and federal politics. It will be a painful and slow process to kill off the metastasising cancerous growths on the economy, but if Americans achieved that, they could embrace a healthier and more productive and more prosperous future.
‘Just like how cats love to be annoyed, I guess.’
What?! ‘Cats love to be annoyed?’ I think you could be wrong, here.
Just this one time.
“What?! ‘Cats love to be annoyed?’ I think you could be wrong, here.
Just this one time.”
ha! I used to take one of those little laser pointers (the ones teachers use, with the little red beam) and flash it around the floor. It drove my cats crazy, they would growl and leap around in frustration. They would stomp out of the room (as much as you can stomp when you are wearing cute little pink pads instead of boots)…But they always came back for more. Just like me trying to understand various deflation and inflation scenarios
‘…But they always came back for more.’
Ahh. The tried and true test of ‘what you really secretly like’. Haw! Okay, then, ella, you are right and I generously admit it, here on this rainy day.
“here on this rainy day.”
you posts have brightened mine, thanks!
The issue of corruption is huge, and ultimately at the very heart of our current mess. Arnie is begging the Treasury for some 7 billion dollars to kep teachers paid etc here in CA. A teacher friend of mine who worked in the Irvine School District a few years back was complaining they had no money for basic school supplies. I asked how in one of the richest cities and counties in the US this could be possible. She answered they have goodles of money, but with ONE Administrator per teacher, all the money was gone. The same I would guess is true of other govt divisions. I would guess not more than 0 administrative positions will be lost in CA, while those actually serving the people and policing our streets, teaching our kids and putting out our fires will be laid off in droves.
What is “softs”? Is that cotton/wool/etc.?
Globe and Mail
ECONOMY
Credit taps running dry in the U.S.
Businesses, consumers and even state governments left in the lurch
BARRIE MCKENNA
With files from reporter Tara Perkins
October 4, 2008
WASHINGTON — In the chaotic two weeks it took to get a monster bank rescue through the U.S. Congress, the credit crisis has spread like a virus, infecting people and companies far beyond its epicentre in U.S. housing.
Many Americans can’t get car loans. Companies of all kinds are struggling to secure operating cash. Banks and brokerages are too afraid to lend to each other. And many state and local governments are facing financial ruin because they can’t issue bonds to pay for roads, schools and other essential services.
California Governor Arnold Schwarzenegger, the former tough-guy actor, sounded like a frightened man as he begged U.S. Treasury Secretary Henry Paulson this week for a $7-billion (U.S.) emergency loan.
“Absent a clear resolution to this financial crisis, California and other states may be unable to obtain the necessary level of financing to maintain government operations and may be forced to turn to the federal treasury for short-term financing,” the Governor wrote to Mr. Paulson. “California is so large that our short cash-flow needs exceed the entire budget of some states.”
Learn to live within your means, governator. I was just reading a post on another board about how ebay, yahoo and sun are about to unleash thousands of hapless fired employees into the Cali economy.
http://politicalhumor.about.com/library/multimedia/arnold_hastalavistababy.wav
Everyone should live within their means. The problem is that if everyone now does so, the drop in aggregated demand will result in a crash. Hence more hair of the dog stimuli are needed going forward.
Speaking of hair of the dog…
one bad side effect of this economic crisis, is that many who bought a house etc got pet companions which are being brought to animal shelter/pounds in massive numbers because families/individuals now can’t afford the food costs for same, much less for themselves.
I just adopted a beautiful healthy 3 yo spayed female lab mix at the pound. She rarely barks, is housebroken, has clearly had obedience training, and is really sweet, cuddly and loyal. She was even microchipped. Apparently the military family who owned her let her wander and didn’t want her back. The pound officer hinted at marital issues and the fact they were moving. Not sure if housing issues were a part of that.
Much easier than getting a puppy. She’s the perfect dog for me.
“I just adopted a beautiful healthy 3 yo spayed female lab mix at the pound. ”
good for you! labs are the sweetest creatures on earth.
\(^o^)/
The goal of this “bailout” and of The Fed is to keep credit flowing. We all know we can expect The Fed to do an emergency 1/2 percent interest rate cut, as early as Sunday night, like they did in January. The hope is to get credit flowing.
What small or medium sized bank is going to make loans at even lower interest rates? Those institutions don’t get an implied backing by the government. Often times those smaller banks are using their own money, with people in charge actually being at risk of losing their own fortunes. They also know that loans they give out will be on shrinking collateral. I don’t see this bailout creating a new flow of credit.
The government is solely fixated on the giants. This won’t end well.
So if credit had completely dried up and J6P & Hockey Mom weren’t ever going to be able to charge anything ever again, why was I accosted yesterday at Home Depot by someone offering me $25 off to sign up for a Home Depot credit card?
Did they offer you $25 in cash or $25 off of a purchase? I would be surprised if it is cash but not at all surprised if it a discount of a purchase since they’re having a tough time getting rid of inventory.
Home Depot has drastically reduced prices on a large percentage of their inventory. I needed some under floor insulation. The old price was $29 per roll, the new price $19. That’s a pretty good discount. Also, interior doors which were $70, have been marked down to $50. These are just a few of the items I noticed. Definite deflation in building materials. Not surprising considering the construction market.
It was a discount off purchase. I was stopped near - but not at - the checkout counters. Maybe they were thinking that someone that had a new cc lined up and a $25 voucher would do more shopping before checking out…
At the end of August, I was at the campus branch of University Federal Credit Union with my nephew to co-sign a car loan and they were having a promotion on new accounts, signing students up on the sidewalk.
We each got a very attractive 100% cotton Burnt Orange longhorn t-shirt with “UFCU Life Member” on the back, for opening free checking accounts. They put $20.08 in each of our accounts and waived my nephew’s $26 membership fee (I’m already a free member). We were both TREMENDOUSLY pleased.
Only downside is when I am wearing the t-shirt sometimes people make little sports fan type comments and I don’t know how to respond. (I think just making the “hook-em-horns” sign would expose me as a phony , but perhaps I’m setting the bar too high.)
“Only downside is when I am wearing the t-shirt sometimes people make little sports fan type comments and I don’t know how to respond. (I think just making the “hook-em-horns” sign would expose me as a phony , but perhaps I’m setting the bar too high.)”
Just smile. You can’t go wrong, people will interpret it to mean whatever they want it to.
Simply make up some phony sports team, and then dis them, i.e., “Yeah, stick it to the piranhas”. They’ll obviously not know what you’re talking about, but don’t want to let on that they don’t know about the piranhas, so they’ll simply smile and nod in agreement.
One of my favorite t-shirts in the whole world was one I got in Zihua, Mexico at an elegant clothing shoppe called ‘Milano’s. It has a bold motif on the front of a cat-like sort of head thingie, and boldly reads ‘PANTERS’.
( I assume they meant ‘Panthers’.) Whatever. I love it.
I sometimes wear it with my jeans I got at the same place, with their ultra-snazzy label ‘Tony Hilfingers’. When someone asks me about this, I put on an indulgent expression and say to that person, ‘They’re by TONY HilFINGER. Much more exclusive than that parvenue Tommy guy.’
You know what, I’m going to go dig them out and put them on right this minute, is how much I like them.
I could only find my ‘Panters’ shirt to wear right now, when typing to the rest of you, here on this windy rainy day in the PNW. Where’s my ‘Tony Hilfingers’? Man, I hope I didn’t lose them.
Oh, gosh! The nostalgia! And then, across the street from Milano’s was a different little mercado effort, with rusty bins and bins of various clothing articles, and I would grub around in them while cars blasted by and dust roiled around and that bouncy accordion/mariachi music played. I would grub around looking for panties, that was my favorite, and none of the sizes matched reality, and the colors were odd and garish, and the leg-holes were clearly made for some kind of mutated circus performer.
My favourite T-Shirt of all time - sadly now only moths holes and stains, is one from a local Taverna on a little Greek Island.
Its for the “Rendezvous”, which doesn’t sound too exciting - until you realise its written in Greek, and ‘rendezvous’ in Roman, is written “Pantyboy” in Cyrillic….
Oh. My. Golly.
A ‘Pantyboy’ t-shirt?! I am SO covetous. I’m also fascinated that that’s how the translation emerged–no wonder those regions are always having such dramatic wars, with that sort of miscommunication going on. It may all come down to the t-shirt printers, in actuality.
Anyway, speedingpullet, the moth holes only make it more authentic, is what I think.
I went to my nephew’s flag football game a few weeks ago. As we were walking back to our car I saw a team of 9 or 10 year olds getting ready for their tackle football game. The equipment those kids had was amazing. It was better than what the pros wore 20 years ago. This is all due to credit.
When I was a lad in little league, every member of the team had to sell a box of chocolate bars, to pay for our meagerly equipped tools of the trade, circa 1971.
I bet some of the 9-year olds were wearing $1,000 worth of equipment. My first car, in 1991, cost me $600.
‘I bet some of the 9-year olds were wearing $1,000 worth of equipment. My first car, in 1991, cost me $600.’
My first car, in 1988 or 9, was in my junior year of HS? It cost me $700. Worth every penny. I didn’t have a dad handy–he was out in the Four Corners area being crazy and playing with his guns. That was when I first learned that being adorable and making friends with mechanically inclined boys was a valuable life skill. Man, I hated that car.
I think you can say the same thing about a lot of the items that the average child has today. The video games, IPods, televisions in their rooms, etc. There are amenities made available to kids that never could have been afforded without easy access to credit.
To my step-nephew’s credit, when he wanted a new I-Pod at the age of 14-15 yrs, he queried family members about selling unwanted items on ebay, and as part of the deal, took a 15 % commission on the sales. He earned every penny for his new Ipod himself. He also told me (at the time) that his would ” hold 100 songs ” because that’s all he could afford to buy. He’s a brilliant young man trying to cope with Asberger’s Syndrome. Hopefully he’ll be able to get the education he needs to develop his scientific/mathematical gifts to their full potential.
“Many Americans can’t get car loans.”
I had no problem, but I have a long and healthy credit history and plunked down a large amount for a downpayment.
However, a young couple from work recently relocated from Canada - no credit history, small down payment - they were offered a car loan at 18%! Smartly, they walked, will do without a car and save for a couple of months.
Spending from savings. How novel!
“Many Americans can’t get car loans.”
How about if we change that to, “many Americans can’t get car loans without substantial down payments to protect the lender against default”? That is the real truth but the MSM doesn’t want to admit that.
This whole thing is Political Correctness which is just code for, “war against the truth”. Even Stalin would be proud. He spent his whole life trying to kill the truth and was never nearly as successful as the American MSM.
I bought a used car in Nov. of ‘07 and the sales guy said he hadn’t seen anyone with a FICO as high as mine in years. I wonder who’s walking through his doors today?
If you’re in the market for a Ford quasi-monster truck, you can get them crazy cheap right now in the Tampa Bay area. You should see Countryside Ford on 19, they like a contractor-on-steroids club firesale.
they –> look <– like, sorry…
KNow what you mean. When SD_Wangenstein and I purchased a car in 2007 the salesman was giddy at out FICO. Said he hadn’t seen one that high before. AND we had approx. 1/3 down, cash. Of course we were only purchasing a Saturn Aura, so maybe it relates to their market? Still was weird though.
My nephew got his credit union loan at a good interest rate, with his short but healthy credit history. I don’t think my (co-signer’s) credit history had much to do with it — they liked his 30% down payment.
Ah, youth … he had his first speeding ticket within 3 weeks.
Luckily you didn’t have to cosign for his speeding ticket, LOL.
We need to CUT in Sacramento. Yes,cut out some of the Democrat Assembly and Senator spenders. We are called the socialist state of Clownifornia.
Bailout Will Help, but Pitfalls Remain
With the soaring costs of the federal bailout–plus added expenses, like up to $50 billion in loans for the Detroit automakers–anything that adds to the federal deficit next year is going to be hard to slip past budget hawks in Congress.
http://biz.yahoo.com/usnews/081003/03_bailout_will_help_but_pitfalls_remain.html?.&.pf=banking-budgeting
i love a writter with a sence of humor.
Quit whining about someone else getting something for nothing and go get yours. Do a SWOT. Strength - Powder dry, pile of cash/gold, ahead of info curve. Weakness - no inside info, emotions. Opportunities - falling markets/prices all around. Threats - inflation/deflation, acting too soon, job/business loss.
Every single person I’ve spoken to over the last week is losing money in the markets and are upside down on their homes. Most of us are avoiding all that crap b/c we saw it coming. Get a grip, men/women. We’re ahead of the curve. Stay ahead. Look forward. The opportunities are abundant.
Good post. Best not to be worried about your 401k or IRA but be worried about what you should invest in a taxable area: 50% precious metals and 50% cash, as well as be debt-free.
Most of the people in Congress have stocks and are aware that they can just sit on the stocks for a few years until they recover, and won’t incur any capital gains until they sell. It’s not the amount of net worth that one has to worry about keeping from the socialists, it’s the amount of income you are making. The best tax avoidance scheme is to drive down your AGI.
When I move to Los Angeles in November I think I will take the suggestions of some of the people here and just use a bicycle (no car). One of the items in this bailout bill is a tax credit for those who commute by bicycle. I’ll live within 2 miles of work.
Why follow the $heep into the abattoir if you don’t have to?
I haven’t tried one out yet, but X-City by Felt is supposed to be a good urban bike. They’re not cheap, but I’ve talked to a couple of people who have them and from the look on their faces when they talk about their bikes - they must be worth it.
‘…I’ve talked to a couple of people who have them and from the look on their faces when they talk about their bikes - they must be worth it.’
Maybe they’re crazy people? Actually, I understand from others that I too get quite a ‘look’ when I talk about some things; rhinestone covered high-heel shoes… old books… tulips… frogs…stuff like that, so I do understand utter infatuation. But see—I’ve tried riding frogs to town and it doesn’t work for crap. They go waaaay too slow, no matter how I exhort them, plus they complain a lot. I don’t recommend it.
How does a frog complain? Judging by the ones I’ve been around it sounds like all they do is complain.
Plenty of frogs out around here, Oly. I almost fell down yesterday as I avoided stepping on one of my garden residents who was gleefully jumping around out in the rain. He’s the one who croaks incessantly near the front porch, I’m sure. I know nothing about the species, but he’s the brownish one who is quite large as compared to the tiny green tree frogs who grace the property as well.
‘…I’ve tried riding frogs to town and it doesn’t work for crap…’
Maybe you need to try an urban frog.
I just identified my resident frog. He is Rana aurora, the Northern Red-legged Frog.
It’s odd how the word frog has 3 meanings.
1) Amphibian
2) Frenchman
3) Belt loop for hanging a scabbard.
Bet one coulod be picked up on ebay or craig’s list about now….
I prefer a cheap ugly bike that no one will steal. I’ll be riding it very early in the morning to workout - the lock for it should cost more than the bike, you know.
Bill, you can ‘disguise’ a good bike by wrapping the frame in inner tubes cut lengthways. A drop of Superglue on either end will secure them
Its an old cycle messenger trick. Most messengers who do it full-time have surprisingly good bikes, which, obviously, they don’t want stolen as soon as they walk into a building.
It helps to keep the paintwork underneath in good condition, should you ever want to sell the bike on.
Plus, it makes the bike look slightly fetishistic, all that rubber
You average bike thief can’t be bothered to undo it, and so normally moves on the next ‘normal’ looking bike to steal.
And, finally, can be a boon if you ever find your ‘tender’ parts coming into swift contact with the crossbar. Its not much, but a few millimetres of rubber is better than nothing in a crunch…
And, totally with you on a lock. I normally go for the D-Lock Kryptonite ones. You can buy brackets for them that hang under the back of the saddle, if you don’t want use a bag when riding.
Yes, they can be freeze-smashed, and in suprisingly short time, but they stand up better than the silly cable locks which can be cut with boltcutters in about 5 seconds.
Though, beware, there’s a lot of very professional bike theives around (especially now more people are riding bikes), so if you are unfortunate enough to get targetted by them, no amount of lockery will stop them. But such is life…
So, if I commute by bike in NYC I get a tax credit? But I also take my life in my hands, forever in fear that some a–hole behind the wheel of a yellow car kills me. But I don’t get any tax credit for using the subway. The amount of discrimination practiced by our government is appalling. I was listening to the true racist Jesse Jackson this morning. He, too, loves discrimination. All of this stupidity is amazing.
He, too, loves discrimination
It’s what affords him those 2,000 dollar suits and limos. What would he do without it?
So what you’re suggesting is that being unemployed is a good thing, BiM? Sweet, I’m ahead of the curve!
I agree that lowering one’s tax profile is a good move at this point. I’m not sure that contributing to a 401k or trad IRA at this point is the best way to accomplish this, though, due to risks in tax policy going forward (I’m not saying you suggest this in your post).
Any suggestions on how to lower one’s tax profile/AGI, as you suggest? Outside of lowering ones income outright?
I told my employer that I would rather have an extra week’s vacation than a raise. No good! I was forced to take the raise.
Dough!
drumminj, I won’t be unemployed when I get to LA. However I will do a 6 month lease there. But certainly “not” working will lower your tax profile.
I suggest that you browse through http://www.irs.gov’s list of forms and publications, as well as discuss taxes openly with your colleagues. You will find some good loopholes to use that you never considered before.
Even back in 1999 when I lived in Tucson there were some people I knew who used tax credits on alternative fuel vehicles.
I have use the rules under some tax forms that give me a substantial decrease in AGI. I don’t want to reveal them - it’s up to others to find out. If too many people use what I use, the Marxists who make up the majority of Congress will get rid of those loopholes.
As for retirement accounts - Did you know that you don’t have to withdraw all your money from a Roth 401k or IRA after age 70 1/2? Did you know that Roth distributions are not considered income and won’t be counted as income when you start collecting your social security benefits? You can continue contributing to your Roth IRA or 401k as long as you are alive. Not so for traditional IRAs and 401ks.
Essentially you will pay Zero taxes on your Roth withdrawals. Best thing, like I mentioned, if you are well past retirement you can continue to let them stay in the market.
I have about 20 years or so until I want to really downsize, but I’d keep my Roth working all those years and beyond.
If you think that we no longer have cycles of ups and downs in equities (and it will be permanently down), you have to prove it to me. We are in a long bear market but we will recover and have another stock boom. When the stock fund NAVs are down, you should be buying equities like crazy.
You people are no different from the bubble heads who say Real estate only goes up. You folks are saying stocks will only go down and never go up. Why can’t you folks see this fallacy in your thinking? It’s hypocrisy!
Agree!
The opportunities are abundant.”
And will grow more abundant as time passes. Those with cash will rule in the days ahead.
“We’re ahead of the curve. Stay ahead. Look forward. The opportunities are abundant.”
Thanks to Bens Blog most of his faithful followers including myself are prepared to seek opportunities in this GD clmate. I am ready to get into a business venture- home repairs on foreclosed properties - have a partner, all the tools, and am good to go. I can ride out this GD and to hell with the gov’t / fed bailout.. Will look after myself and do what it takes to get by, even with this severe economic downturn.
Cash is king
When times are tight cash is king who suggests some ways to maximise savings
By Kara Gammell
Last Updated: 8:21AM BST 02 Oct 2008
PB interest rates are zero in america.
One possible explanation for zero nominal rates is that inflation expectations are negative. For example, if I am saving up for a downpayment to buy a house while home prices are dropping by 25 pct a year, then the return on my “investment” in cash relative to the price of my future home purchase is 33 pct* per year.
* (1/.75-1)*100 = 33 pct
It’s good to be king.
Rough Scepterember though eh, king?
Not for me; I’m doing just fine.
Events are unfolding almost as if they have been scripted.
The next event, the one I am patiently waiting for, is the mass emptying out of mutual funds and 401Ks of the numerous quality stocks held in J6pk’s accounts. Opportunity will abound. Those with cash will buy from the panicked.
I love America.
Those with liquidity will buy from the deleveraged.
Wow the Brits are getting 6-7 percent on their savings ? We were lucky to snag 5 percent on a 4-year CD today at Flagstar. Goodbye TCF. Hello, Flagstar.
How much of this turmoil related to hedge funds unwinding?
Redemption song.
Some. It’s much bigger than that now, however. They’ve created a stampede with all the doom and emergency alerts. Mr. 6Pack is rattled. Is he going to get a paycheck? Is his money safe in the bank? Are retirement investments safe? Is overpaying the house/mortgage worth it?
Derivatives in all their forms appear to be a large part in this mess. It will take much more than a trillion dollars to fix this, in fact I doubt there is enough money in the universe to fix this.
I disagree. We could pay in latinum bars and dilithium crystals.
Cap’n we’re gonna need to replenish our HELOCium crystals, otherwise the warp drive consumer can’t power enterprise…
Scottie, you’re fired!
A bit off topic here when when I turned 50 recently, I was doing some introspection about my 30 years in sales. I didn’t want to go by the way of the dinosaur with technology being way out in front of me. I see my clients ordering less and less of my widgets because of the economy.
For the last month, I have decided to reinvent my career with 3 words. Search Engine Optimization (SEO).(reminds of Dustin Hoffman’s Famous Line…”Plastics.”) Most kids in the their 20’s never picked up yellow pages. They use search engines.
There are ways to make money on the internet if you understand SEO and Pay per Click(PPC). PPC is sort of a huge scam by Google, Yahoo and MSN when you start to undrstand SEO. (It can make you money of you have to do something quickly but I would not make it the basis of any business)
I have been meeting with the top SEO companies in my town here the last month with the express interest of buying part of their business and not only doing SEO’s for clients, but selling their own downloadable products on the internet.
Most of these kids are in their late 20’s and are so busy surrying getting their clients successful through SEO, they don’t have a ton of time nor the capital to try and get rich themselves. I hear stories of how someone’s client was doing a so-so business until they starting SEOing their site and now they are going gangbusters.
One guy’s client make a few hundred thousand a year selling exit signs over the internet. Many times the niche product is the most successful because of the lack of competition.
I am understanding how link building is huge for a site. So is blogging. I now have contacts in India who can do most of this work. You shouldn’t, however, leave an entire SEO project to overseas subbing but you can find the right people in India, Russia and Eastern Europe.
I agree with Ben and many of the other folks here. We KNOW what’s coming and there is a way we can profit whether it’s through the internet or something else. It’s fun to make fun of these goofs who run our country and we will continue to do so but we need to look at profiting.
Baby boomers like myself cannot rely on any Social Security. Like they say in troubling times. When TSHTF, it’s us who we have to rely on. No one appears to want any handouts from Uncle Sam.
“I now have contacts in India who can do most of this work…but you can find the right people in India, Russia and Eastern Europe.”
No offense meant, but this is part of our problem, sending everything overseas. Have you tried to hire any of those kids in their late 20’s?
But i found out that if you really want to target maker an area…no search engine is as good as the yellow pages.
Just take for example Furniture stores in queens NY………..on a search engine you will get hundreds of hits from all over the country…plus paid ads
I found google it to be kind useless if i wanted to find exact match stores items within a 10 mile radius of home…..
I have gained a lot more respect for the old way in the last few weeks
————————————————-
Most kids in the their 20’s never picked up yellow pages. They use search engines.
Yer right, DJ, when I need something local, I never go to the net, I pick up the phone book.
When I was in business, the cost of paying for yellow-page ads was more than I paid for rent of a street location retail store…
Most kids in the their 20’s never picked up yellow pages. They use search engines.
search engines do not compare to word of mouth. when I am looking for something I ask around and I think many people do the same.
search engines are better for finding unusual products that you get by mailorder.
“search engines are better for finding unusual products that you get by mailorder.” With all due respect, that’s not the only time people use search engines.
And no one ever said word of mouth wasn’t a great way to increase your business.
When I want to meet someone at a Starbucks in the central part of say San Diego, would I call up a few of my friends to see if they know of any Starbucks there by word of mouth?
In 10 seconds, I can google Starbucks San Diego and see everything.
Come on Ella, since you are on this blog you are obviously are fond of the internet. When I typed in “housing bubble” in quotes, guess who’s site was at the top of Google? Ben’s of course.
Ben-your comments would be appreciated.
“Come on Ella, since you are on this blog you are obviously are fond of the internet. When I typed in “housing bubble” in quotes, guess who’s site was at the top of Google? Ben’s of course.”
Oh, I am fond of the internet, and wasn’t meaning to give you a hard time, just giving you my 2 cents. I found Ben’s site through a local blog in Vancouver (It had a link to this one) that I found while trying to find out who the heck was building a big highrise across the street from me. Until I stumbled upon the blog, I had never heard of a housing “bubble”. I had noticed people around me were going a bit mental, but wasn’t sure why. So, it was search engine related, if you like, I guess (?).
I do use search engines on a regular basis, but mostly for news, measurement conversions & recipes. Products & services are more word of mouth for me personally. Hopefully you will take my experience as market research rather than a challenge to you business model, which is probabaly great, as you seem to be quite passionate about it.
You’re OK in my book, Ella:)
Hey, you, too, George! I admire an entrepreneur, and starting on a new venture at 50 is cool. The internet is like the wild west (still). When you strike search engine gold, give us a holler!
I remembered after our exchange that I found my wedding dress online (slaps forehead).
NYCDJ-Just Type in “Furniture Store Queens.” If you don’t use the quotes, you can get any website in the country that have those 3 words in them not not necessarily in that order and you don’t want that.
You can get a furniture store in LA that has a special on mattresses that are Queens.
I actually have a friend who does just this thing here in Austin, TX. She’s in her early twenties, and has been considering striking out on her own to work with smaller businesses like yourself.
Having an account like yours on the side, to help one get the confidence and get started would be huge. I’d encourage you to try to engage one of these twenty-somethings to help you out.
Like Lost suggests, we need to be supporting these types of businesses here in the states, rather than giving our business to those abroad…
‘Like Lost suggests, we need to be supporting these types of businesses here in the states, rather than giving our business to those abroad…’
Testify, losty and drummy, testifyyyyyy!
Just met a 24 ish who will be helping me
with pc/internet related search engine stuff.
Found him on craigslist, real nice kid.
Looking for extra money for his artists lifestyle.
Straight, no drugs. Smart. Who knew. Hire a Local!
If I can find a good kid here who is a little more than overseas, by all means i would hire that person.
If you are doing mindless stuff like link building, the getting 2/3 off the US price by doing it overseas, the overseas person will get it.
If I was to go to Walmart and buy let’s say a stuffed animal as a kid’s birthday gift, I would not pay $30 for the US made brand when I can get the exact China brand for $10. Let’s face it, most non food items at Walmart and not made in the US so we’re all a bit guilty of employing overseas folks.
“If I was to go to Walmart and buy let’s say a stuffed animal as a kid’s birthday gift, I would not pay $30 for the US made brand when I can get the exact China brand for $10.”
In many cases you’re right on the money, and I have some clothes in my closet are subsidized by the low wages of other places. However, in your example: I know that if I do this and give the $10 one to my niece, my sister will not let her keep it. She has gotten pretty terrified of made-in-China toys (I am less nervous, but am not a mom). I try to buy less and buy local for purely selfish reasons: I like high quality and I am stingy
Also, I live in tight knit community and we often barter, since many of us are small business owners. So, there’s more than one model, right?
Financial Crisis: So much for tirades against American greed
Ambrose Evans-Pritchard says it is ironic that European banks have turned out to be deeper in debt than their US counterparts.
By Ambrose Evans-Pritchard
Last Updated: 1:12AM BST 02 Oct 2008
Interesting piece. It looks like the strong Euro policy has been bad for both the export led countries as well as for those with large property bubbles. However, the property bubbles will eventually burst even absent interest rate increases and exports would typically decline if the countries to whom you are exporting go into recession. Would different monetary policy merely have delayed or softened those impacts?
If I understand this article correctly, it sounds like the Europeans had a different model of counterparty risk. Instead of open leveraging of their stocks, they purchased insurance policies covering cheap but riskier investments than their American counterparts? Now that AIG has needed a bailout, it has revealed the actual debt exposure of their banks.
Also, the article implies the Euro is simply a tool of political union instead of actual wealth and economic security. If that is indeed the case, long term investment in Euros may not be a safe bet after all. Depending on where those notes are redeemed, one sees currency inflation or deflation…but none of those economies individually strikes me as a safe place for long term investment, since the real long term strength of the currency apparently depends on their keeping it whole.
there is a lot of BS in Amroses article and it is just a frame for demanding ratecuts, now, immediately! like he does about three times a week in his editorials. VERY boring. Ambrose still does not understand that expanding the money supply and lowering rates is the source of the problem, and not the solution.
President Bush is the Greatest! His bailout is really working here. The sun is shining and all is well. Thanks to all of our senators and congressmen for all of their hard work. We couldn’t be here without you!
Not only that, but now that the bailout is in place, a housing market bottom is at hand. Time to celebrate by going out and buying ten investment houses at fire sale prices!
Took a drive to my brother’s house near the Delaware Memorial Bridge yesterday and the ink wasn’t even dry from W’s pen on the bill and I saw more dump trucks, concrete mixers and excavators moving hither and yon. Fire ‘em up boys, the party’s back on! It may be over for the Streeters, but for them, another trillion should be just around the corner.
It’s raining in New York City. That seems fitting.
Cold and rainy in W. Colorado, a presage of things to come.
First rain of any substance since February, here.
The sunspots are returning.We are saved.
Wheeee !
Cold and overcast on the front range. Rain is in the forecast for tomorrow.
Drizzly in Alaska. There’s a pall over the arrival of winter, something we normally celebrate (skiing season and such). Lots of scared people out there.
Same here in the San Juan Mtns of Colorado, tourism is down, a local RE shop closed doors (this is Tellyride Country, for pete’s sake), new snow on the mtns, and the local paper even had an asinine article by a loco I mean local banker saying this mess isn’t Wall Street’s fault, but EVERYBODY’S fault.
I’m battening down the hatches and heading to the Utah desert, where a person has to watch their ways and say flippin’ instead of what it stands for. Hard to reform after being here, but doable, maybe.
The summer locally for merchants was saved by the foreign tourists picking up the tab, as Americans tended to stay away in droves…
When I picture wandering the Utah desert and the foothills of the Rockies it makes me want to hum an Eagle’s song…”million stars all around” and such. Glad to hear you are still lost and wanderin’
Thanks, it’s my fete, I mean fate.
It’s raining here, too. But since I love rain, it’s not ‘fitting’, so to speak.
I woke up in the night and heard it drumming down on the roof and felt grand. I felt sorry I didn’t gather the last blackberries off the fence, as they probably got washed off or will now get moldy, but anyhow my freezer was full and all my glass jars. And now the mushroom season will commence, and I hope it’s a great season. Last year I ate so many wild mushrooms I never wanted to see another one for months, but now I’m entirely ready again. Rain! More rain!
And by the way, yes, the whole impending financial collapse does indeed suck. I’m just having a hard time being somber when it’s raining so prettily.
Commie!
Frankophile!
I hope they’ll still be here to save us next time an asteroid comes hurtling towards earth.
There is always a cloud over long Beach, Ca. Drizzle today with a chance of showers.
Here is a comp killer
The New Aqua building. 388 E. Ocean #P15
Sold 2 years ago $1,250,000
REO listng $499,900
Nice Haircut
Double plus good-times here in Florida. Everyone is breaking par and the cart girls are topless. Thank you, Sir.
Heckuva job Paulie!
To hoz, re: bank earnings discussion the other day, initiated by Mark Cuban’s statement that $1.25 Trillion was more than all the money made by the banks in history. I stated that just 5 banks had made 1.25Trillion in just the last 3 years.
I was referring to revenues, not profits. Usually when you talk of someone “making” something (e.g. I made $N last year) you’re referring to revenue, not to revenue minus expenses.
I think that’s relevant here especially. Cuban was comparing how much has been lost already in this crisis ($1.25T he claims) as being more than what has been “made” forever in banking. Well - a very large percentage of the excessive revenue that the banks took in the past few years of the housing bubble have not actually hit the bottom line - instead most of it went to bonuses for the executives and employees, hiring new employees, brand spanking new buildings etc. All these are expenses - excessive in most cases, but expenses nonetheless. Thus much of this money that was made (in revenue) didn’t hit the bottom line (profits).
What I’m getting to is that I very much don’t want us to feel badly for the banks (and mortgage brokers etc.) that made out like bandits in this bubble just because they’re now losing more money* than they showed in profits during the bubble - because what they made in profits it’s what matters - what matters is what they made in revenues and other income (venture capital etc.). All this was huge overspending. It’s the same as the dot-com bubble - way too much money was pumped in, and the profits made were just a tiny fraction of the actual excessive money (i.e. resources) wasted by the bubble.
*In reality most of these entities haven’t actually lost this $1.25T. They’re in the process of being reimbursed via government debt, which eventually will either be passed onto the taxpayer or simply lost through inflated currency.
If you thought banks did well before, this rescue bill is a license to steal.
Much as I love this country, I am no longer financially invested in it. As long as other countries (primarily Asia) continue to accept dollars, I will use it as a funding source.
hoz, pardon the interuption. But does your funding sources imply you are going net short Asian bonds?
that sir, intrigues me.
Short US Treasuries for funding. Borrowing money for 2 years at less than 2% is awesome.
Sold my long JGBs Friday morning (up to much for my comfort).
Basically long Yen/Short Euros - no reason to change.
‘Til Monday.
thanks, I feel better now.
till Sunday night then.
Out of all the crappy news yesterday the governator’s plea to bail out teachers and cops was spooky.
Too bad i will have no income to help with the bailout.
I am living on savings.
Home school.
Require everyone to carry an unconcealed weapon and know how to use it and we won’t need cops.
It’s pure extortion, playing on people’s fears.
Discrimination run rampant. If Barney was straight he would be long gone. Or is stating the truth “homophobic”?
http://www.foxnews.com/story/0,2933,432501,00.html
Could it be simply that obvious conflicts of interest with spouses is viewed differently than with other family members or non family members? Do they want to open up that Pandora’s box?
It’s also possible for one to take actions that might be beneficial to a family member or spouse that might have been taken anyway. Generally, however, I would prefer to see politicians remove themselves from situations with potential for conflicts of interest.
Spitzer was banging a hooker and got run out on a rail. And this doesn’t get Barney Frank run out? Give me a break.
I wouldn’t get rid of someone over a hooker unless that made them a hypocrite based on previous actions or statements.
I have little tolerance for conflicts of interest. Resignation or removal and/or prosecutions as appropriate.
Boy,
You are quick to jump on a conservative media’s criticism of a gay relationship and possible conflicts. But I bet you don’t support gay marriage. The relationship behaviors of gay people would be much fairer to criticize in a world where there was equality for homosexual relationships.
I couldn’t possibly care less about the concept of gay marriage. Let cats marry. Let dogs marry. I lived down south for a while. If a guy wants to marry his goat then let him. What do I care? Of all the problems in this world, who is marrying who seems like something not worth forming an opinion about?
You strike me as somebody that is a good little Political Correctness drone.
I’m not a drone, just gay. And I don’t mind calling out the hypocrisy of a bigot. I don’t agree with Barney Frank’s politics, but I won’t tolerate his being attacked about a gay relationship by people who don’t tolerate gay behavior.
And thinking of gay marriage in the same breath as farm animal marriage speaks volumes of your character. Gays in your mind are not human. No doubt you were an admirer of Jesse Helms. Good riddance.
“No doubt you were an admirer of Jesse Helms. Good riddance.”
Beyond moronic. I live in The West Village. I don’t think you can hate gay people and live here. I hate people from all walks of life. That just makes me reasonable, since there are so many people that deserve neither respect nor fond feelings. And right now I have neither for you.
Ignore diversity.
Village people.
” I hate people from all walks of life.”
I am going to say something to you sincerely, and you can snark back if you want. I am a woman and I try my best to be financially prudent, to be a good wife and to be a good (if not outstanding) member of the community. There are a number of financial blogs I stopped reading before I found this one, because there were so many comments about how wasteful and stupid wives were. I would be reading, and then *pop* out of nowhere, a little hateful note about…me. Even though I am a great saver, and never demanded a big diamond ring, or nagged my husband to buy a house we can’t afford. Those comments weren’t just offensive to me, they were also distracting and they just plain hurt my feelings after a while. I don’t, personally, appreciate them here. As someone with gay relations and friends, I also don’t appreciate the goat-marrying stuff either.
You may feel like you’re an equal opportunity hater, but you are not coming off that way. After reading the blog for a few years I don’t think you’re a bad guy, but I find several of your comments on this thread to be kind of ugly. I really wish you would redirect your attacks at spendthrifts, poorly managed banking institutions, bad political bills, real estate agents and other equal opportunity hatees who have thoroughly earned it.
As a fellow prudent saving and renting wife and blog reader, I think I would like you. Nice to see others exist.
‘I hate people from all walks of life.’
Alas for me and my immature spirit, because I thought that was funny. Also, I like to criticize my gay friends for their stupid relationships almost as much as I like to criticize my straight friends for their stupid relationships. And you know what? They all sound exactly the same:
‘Oh, he’s SUCH a jerk, how could I EVER have loved him? boo hoo hooo….’
Just like that. Hahahahaha!
Face it, ella. People are funny, AND they’re idjits. All the time. All the people.
HOW can any repub be against creating JOBS?
Gay marriage creates jobs for people like me….their money is as good as a straight persons…..
Ella, bubble, and Olygal - you’re not the only ones.
All this ‘wife-sniping’ has to make you wonder about the kinds of gals these guys married (or didn’t), so don’t take it to heart. If that’s their definition of ‘wife’, then good luck to them.
Though, it has to be said, this blog does a pretty good job of weeding out the wacko politics/gay rights/religion stuff, and has loads of good info on housing and economics, so I tend to take the rough with the smooth.
“Face it, ella. People are funny, AND they’re idjits. All the time. All the people.”
yeah, it’s true. For some reason this makes me giggle when it comes from Bill Maher or Jacques Tati, and less so when it comes from Rush Limbaugh. I was going to write something snarky, but I thought I would just be honest, even if that makes me look humourless and square. Maybe I read it wrong, but I thought it had gotten more rude than funny. This is why they invented the phrase “YMMV”, I guess.
bubblicious, it is nice to know there is more than one of us. When will Renting Blogging Frugal Wives replace Desperate Housewives? We’re fascinating! Watch us type about housing and make a grocery list
What will we do next…tune in next week…
Make sure the goat is cute ! hehehehehehe
At least Spitzer’s hooker was a babe! hehehehehehe
Similar thought: Keating 5: If John McCain were straight he would be long gone? http://seattletimes.nwsource.com/html/politics/2008157607_mckeating04.html
Generally, politicians are crooks regardless of sexual preference, race, creed, ideology.
As a non-partisan I have no problem with that.
My prediction, now that Congress has totally sold us down the creek, is that in about 6 months we will see it all crash and crash ugly, nothing can prop it up any longer, and we’ll have a long and ugly depression, maybe 10 plus years, but much longer than it would’ve been had the bailout not passed.
Time for a tax revolt, a stop-work revolt, but people have no reserves for such a thing, if they stop work they starve. Their employer won’t stop taking taxes from their paychecks, lest they get fined. So the average American is now a slave to Wall Street and the corrupt banking system with no recourse. If people had saved instead of spent, they would be in a position to go on strike and shut the system down. Not saying the average American has that kind of awareness right now, but things are unwinding and it will come. There’s a reason corrupt governments don’t like self-sufficient people.
Do not go easy into that good night.
At this point in time, I believe we have passed a tipping point for this country, the elites have now instituted slavery.
I am now moving into the underground, I refuse to work for anyone who will take taxes from my pay, I will work only for cash or barter. Fortunately, I’m in an area known for such shenanigans where people have done this for forever. I’ve actually worked on this basis for the past 10 years anyway, calling myself a consultant. The only taxes I’ll pay will be on my vehicle (annual plates) and when I purchase something, which will be as rare as possible. I carry the minimum insurance for my car and p/u. No health insurance, my health insurance is taking care of myself. I will pledge my allegiance to my fellow travelers, like Mugsy said the other day, and to no one else. I no longer feel like I have a government and I refuse their governance. Call me an anarchist, but I’m not an anarchist in the sense of chaos, but in the sense of freedom from government and slavery.
Yeah, I’m pissed this morning, everyone in this country should be. Ain’t nobody’s toadie, least of all pigman monkeyboys like Paulson and Bushieboy. Traitors.
And am I glad I don’t own a house - no taxes and I can move wherever I want anytime I want. I will die before I pay another dime in federal taxes to these asshats.
“Time for a tax revolt, a stop-work revolt, but people have no reserves for such a thing, if they stop work they starve. Their employer won’t stop taking taxes from their paychecks, lest they get fined. So the average American is now a slave to Wall Street and the corrupt banking system with no recourse.”
I believe it was the Donald who once said “If I owe the bank a million dollars that’s my problem. If I owe the bank a hundred millions dollars that’s the banks problem”.
The revolt will not happen over taxes or work slowdowns. The revolt will be in the refusal to pay debt. It’s only logical. The IRS will come take your stuff if you refuse to pay and they don’t need a court order to do it. Banks and other lenders, not so fortunate. They have to sue first to take your stuff.
They can have my stuff - old Ed Abbey books mostly - if they read them, maybe they’d join me.
I have a confusion to make, I mean a confession.
To the IRS: If you decide to come looking for me, I actually live nowhere near Utah or Colorado, it’s all a smokescreen.
I’m actually NYCItyBoy’s next-door neighbor.
Prove me wrong.
Turn down that f-cking hip-hop crap.
You shouldn’t want to claim to live in a place that has local/City taxes!
Lost,
Welcome to Galt’s Gulch…
Thanks, Lad, but I’m leaving next week.
I really am there, Ouray Valley.
Earth Googled Ouray Valley.
Seriously out of the way.
Was surprised to see the crop circle farming to the South.
Where’s the water? Aquifer?
H2O for Ouray is rainy weather, lots of snow in the winter. Lush beautiful place.
But you go downvalley to Tatertown (Montrose) and it’s all irrigation from the gunnison river. Serious desert, otherwise.
Speaking of the Gulch, here’s a strike possibility: keep your cash out of the corrupt American banking system.
Lost:
It’s as much of a mentality as a location and vice versa.
Utah, yesterday ouro’s cry o meter was off the charts.
As a female it is acceptable to cry, my biggest tears come from rage, yesterday i was seething.
Today I am redoing my shelves and storage.
Hey Ouro, not to worry, go donate some time to a local animal shelter and make a difference, it will make all the difference.
“Hey Ouro, not to worry, go donate some time to a local animal shelter and make a difference, it will make all the difference. ”
Best bail-out plan I’ve heard .
The walkaway revolution is the revolt. They are scrambling desperately on wall street and in Washington to save the system. The system has already been breached and is currently collapsing. It’s time to chose winners and losers.
‘Yesterday ouro’s cry o meter was off the charts. As a female it is acceptable to cry, my biggest tears come from rage, yesterday i was seething.’
I still have posters everyday that seem to only be interested in scaring people. I hope you fear miesters are proud of yourselves. I’m going to keep to the high road.
How much scarier can it get than having the CIC get on national TV to threaten the globe with financial Armageddon if the rescue bill was not passed? Few posters here have achieved that standard of menace.
Gee, Ben, I hope I’m not on that list.
The only one I’d like to put any fear into is the PTB.
I liked Mugsy’s post the other day about people sticking together, that’s what matters.
I still have posters everyday that seem to only be interested in scaring people. I hope you fear miesters are proud of yourselves.
thank-you. there is way, way too much melodrama in here today.
I agree Ben. There is money to be made. It is other people’s bank accounts and we need to return it to it’s rightful owner. Us.
Well, in response to the above posts by all, I think we’re all informed/smart/cynical enough to know that there’s way more change on the wind ( ” The world is changed. I feel it in the water. I feel it in the earth. I smell it in the air. Much that once was is lost, for none now live who remember it. ” Galadriel, Prologue, “Lord of the Rings” film ). Everyone has to take his/her own measure. Some are fit and experienced enough to plan ahead to buy stocks when they’re down. Some are moving to the wilderness, in response to their inner cry of being a voice in the wilderness, and no one responding to their wisdom. ( Good luck to you, Lost, by the way. I always enjoy your posts. ) Some will be riding bikes. Some are trading in derivatives. The good thing is, we’re all willing to share our insights with each other. These are scary times, Ben. At least there is a community here that begins to undestand that we’re in Deep Sh-t. So, I don’t condemn anybody for being scared. Or angry. Or puzzled about what to do next. Whether you invest in the downturn or hunker down, we’re all a little out of sorts.
I was livid yesterday and the people I work with knew it. Today it has sunk a little more in, as I told my wife, “Our Country committed financial suicide yesterday”. Today has been a decompression for me. I am scared. I have mouths to feed- to keep warm and dry this winter. I thank God for this blog as I has led me to prepare (not as much as I wish I’d have done, but nonetheless) 5 cords of firewood, food storage, cash on hand, silver (gold is beyond my reach), I rent and can be mobile if need be, money in a credit union my wife works at, a paid for car, etc, etc. etc. We are some of the brightest people I have come to know and I wish you all the best. We can and will fare better than 80% of those out there… we will be facing similar situations as the video alad recommended about Argentina.
I have been told over the years to choose something to do as work and do it better than the rest. I always nodded my head as in agreement, and became a jack of all trades anyway, I knew at some point I’d need to know more than one “trade”. If something needs worked on I can most likely fix it or find a replacement cheap. That is what I do best…
I rarely post more that few lines here and there, usually in jest- but I have come to consider many of you extended family, in an odd way. We can bounce ideas, concepts, futures, pasts, from just about every subject known to man and come up with a rational explanation for it and the best way to deal with it. So- let’s draw a deep breath, be pissed, scared, sad and the such… then let’s tackle this bastardization of what we used the USA and do what we do best, beat the odds.
Here’s to us.
Good rant there, Lostie,
But how do you REALLY feel…?
Me? I’m thinking that after yesterdays’ Bailout for everyBody, ($28M tax break for toy arrow manufacturers? Count ME in!) tax revolt-by-default is up next.
I.E: FB’s at the end of their rope put their property taxes on the last chunk of their credit cards and oops…default. Poor Ahnode thinks he’s got troubles NOW?
PS. “Howdy” everyone! The dim light of this gloomy weather has allowed me to open my eyeballs enough to read a puter screen again. Feels like home!
“The dim light of this gloomy weather has allowed me to open my eyeballs enough to read a puter screen again.”
Me, me, me. Is that all you do is complain? Those of us with real problems don’t need to be distracted by somebody that went through, what, a little bear attack. Listen to my problems. I may not be able to get 6% on my savings account. Now don’t you feel silly for being so shallow? Geez.
Del McCoury’s “Moneyland” (YouTube)
Now it’s a pity to see
When the land of the free
Turns out to be
Nothin’ but a free for all
If you got big dough
You’re freer than most
Cause your freedom goes up
With the size of your bankroll
You can buy a judge or a bribe
Or a thug or a bomb or a shredding machine
You can buy your way through into
And onto any ticket or TV screen
———-
Chorus
It’s a money disease
A thing called greed
And it feeds on those
Who need the money most
In Moneyland
Oh it ain’t so funny
If you ain’t got the money
In Moneyland
———-
Now a corporate crime
You just do a little time
Pay a little fine
And then you’re in the clear
Murder and robbery
Caused by snobbery
Doesn’t mean a thing
It just falls on deaf ears
Money is the thing
We all sweat for
It’s what some dreams
Are made of
But then there’s those
Who want it all
And enough is never enough
Chorus
Oooh money money money
Oooh more more more
Oooh money money money
Oooh more more more
Now a piece of the action
Is the main attraction
Get a big house, fast car,
Honey, you’ve got class
What’ll it get me?
How much? What’s mine?
Are the only questions anybody seems to ask
Now who got beat, got bought,
Got bled,
And who got burned today
Who got fixed, got fooled, got framed
And who got in the way
Chorus
When Will Los Angeles Run Out of Water? Sooner Than You Think.
Los Angeles has been sleeping far too long. But the question is not when will it wake, but rather what it will do once it does wake and realize the water is gone.
“We are way better than Third-World countries with no water supply,” explains California Department of Water Resources drought coordinator Wendy Martin, “but it will take a significant change to keep ours.”
Martin is speaking of California at large, but the science is in and the climate crisis isn’t hard to figure out. Water isn’t a renewable resource, so that makes Los Angeles the state’s parched yet still bloated problem.
According to the Los Angeles Times, the state’s water reserves are nearly finished, which leaves California with two options: Pray for rain, or suck off Northern California’s supply. Guess which one it’s going to try first?
http://www.alternet.org/water/101193/when_will_los_angeles_run_out_of_water_sooner_than_you_think./?page=entire
====================================================
In his most excellent book Cadillac Desert, author Marc Reisner related that the city of Los Angeles could only support around 100,000 people in 1900, relying upon it’s natural scanty local water sources.
In the greater L.A./O.C. void, there are probably around 150x as many people living there now, as in 1900.
My friends that live about 30 miles outside of Melbourne, Australia told me a few years ago what happens when reservoirs go down to almost nothing and aren’t replenished.
The water they carefully use (a rubber tub catches all shower water which is then used to water plants) is the dregs.
My friend complained that after shampooing her hair and rinsing off, it now left her hair all stringy.
They also told me about how all of the sudden a market sprung up for 500 gallon open air tanks on top of buildings, to catch precious rain water, every last drop.
So, are you saying that the West Side of L.A. will stay bubbly? Is that what I’m hearing? I’m so confused. It must be a great time to buy in L.A., just like it’s always a great time to buy in Manhattan. I think L.A. and Manhattan are twins that were separated at birth.
It’s a roll of the dice…
We get a decent to great winter snowpack, and we can kick the can of problems down the road another year perhaps, but if we get another lightweight snowpack, it’s curtains for everybody, including perceived bastions of L.A.nded gentry.
I think we could partially cover the aquaduct to lower evaporation, switch to lower water landscaping and build a large scale desalination plant. The small naval base down in OC/Susnset beach area would make a great location.
Also for places like Vegas, they should try some super deep cisterns as dug in the middle east. Again lower evaporation storage of water than lake mead.
Also like for us to build a nuke power plant in the IE. Though we could expand wind power out there or offshore.
If only we had 700B$ to work on these projects…
You have to wonder if a substantial source of the climatic shift and drought is the aquaduct and hover dam. They change the amount of evaporation and run off. So the natural vegitation changes. That causes areas like Owens valley to become barren. In turn the albedo of the area changes and effects localized weather in California… the extra heat lowers rainfall.
No proof for any of that but massive projects like that often have unexpected consequences.
Link to your website?
Thanks.
No amount of money will prevent lawsuits from blocking the implementation of nuke-powered desalinization plants in CA. IMHO.
my newspaper had an interesting story today about a proposal for largescale combinations of solar heat plants with desalinisation plant and greenhouses (?) to be situated in desert areas near the ocean. They say it has been tested already on a smaller scale and seems to be very efficient.
The whole system even has excess power and water after feeding the crops, cleaning the solar mirrors etc. so they could even add certain tree plantations etc. outside the greenhouse areas. If is said to be far more efficient regarding power/water use than the current systems that are used in most of the first world. It uses pretty basic technology so relatively cheap (pocket change compared to the 700 billion gangster bailout package …).
Works best in regions like MIddle East, but possibly Spain (and maybe CA?) with plenty of sun and a water problem are other candidates. Of course it is always prudent to keep checking if there are unintended consequences with such massive projects …
“I think L.A. and Manhattan are twins that were separated at birth.”
Yes. That’s what’s wrong with BOTH of them. Plunder the neighborhood for resources and just say “screw them”.
Excellant book, of which China Town the movie was a hollywood version of how the water was stolen, originally.
The water wasn’t stolen. It was paid for fair and square. More revisionist history by the left wing wacko fringe.
Cadillac Desert should be required reading of all living in the arid West.
I knew a retired comish of the Bureau of Wreckthenation, spent a lot of time talking to him about this issue, he never faltered from his technological fix, tho a reasonable man in all other arenas. He was just killed flying a small plane in the canyon country of SE Utah, a darn good pilot, no one knew what happened, darn nice guy.
One of the factors in picking a relocation/retirement city was access to water going forward…..
Boise isn’t bad. The Snake River is all within Idaho until way downstream at Lewiston. The Boise river is all local, and in Idaho law water rights run with the title to property. I have water rights in perpetuity for watering my yard for essentially free. The irrigation system in the area (Ada and Canyon counties) was built so long ago that it’s 100% gravity fed and requires therefore no pumping stations to get it to my property line. I pay a nominal (about $20) annual fee for all the irrigation water I can use.
They won’t need any water if people keep moving out.
Newsday dot com
Experts: Bailout won’t stop economic, housing downturns
BY RANDI F. MARSHALL |
October 4, 2008
THE $700-BILLION financial industry bailout that became law Friday could make a recession shallower, and potentially even shorter, but it won’t stop the economic and housing downturns in their tracks, according to economists and other experts.
And homeowners, consumers and job seekers who are in financial trouble won’t see a quick fix to their own problems, either, the experts said.
…
WHY SO GLUM?
Why did the stock market decline despite the passage of the economic bailout bill? According to experts:
1 The economy can’t recover until home prices hit bottom. And that won’t happen until at least midway through next year - with or without a bailout.
2 The magnitude of the financial meltdown far surpasses even what the bailout can do. Investors worry that the rescue plan doesn’t solve the underlying problems in both the housing market and the overall economy.
3 Uncertainty. What other chips are yet to fall - what else is out there that will have their own problems - i.e., commercial mortgages or credit cards, or other sectors.
4 Recession - no matter what. Friday’s job numbers indicate that the economy is probably in or headed to a recession.
Allright, time to talk car business again, phoenix market!
So the car business has been -interesting- lately. Our HUGE honda store is down huge in sales over the last month (talking in excess of 35%). I’ve moved completely to prospected sales, pulling customers in from other sources rather then relying on the dealership to bring them in. So far so good for me, but most of the store is starving and that includes the management and service department… Just in used-cars there are 6-7 people (out of 14 total salespeople) who literally wont make a check from last month, it’s going to get really really ugly. In used-cars alone we sold under 100 cars last month, previously our lowest month on record was around 150 if that says anything. Average gross in the used dept fell to 350$ a car (normally averages over 1k) so the people who did manage to sell a few still didn’t make a living.
Our sub-prime banks have almost completely pulled out, they are either out of business or not taking new loans unless they get stupid terms (a huge “bank fee” and a car at a price that is practically stealing it if they have to repo). I talked with some subprime guys from around the autoplex and the consensus is “it’s over”. Our store is down to one guy working a department that used to account for a signifigant amount of sales for the store, and he managed a whole whopping 6 cars last month for 580$ in combined gross TOTAL.
As I said before, the really strange thing is SERVICE is suffering. These guys are getting half or less of the “work hours” they normally clock. People are letting basic services get put off, they aren’t spending the money keeping the car up. Our oil changes are down by about half if that says anything. I was figuring this would be opposite, service being up thanks to more people keeping older cars on the road. As it turns out most of the service we -normally- do is preventative scheduled maintenance and people are simply skipping it and waiting for something to break (thankfully for the customers, honda’s are historically very good at holding up to this kind of treatment).
Anyway, our store is still in the black but the margin is already getting razor-slim. Already 2 of the dealership’s in the Autoplex are gone (suzuki and mitsubishi). Everyone I know from a decade in the business is scared, I’m getting calls every day asking if we’re hiring (because as bad as it is here at honda, it’s SO MUCH WORSE everywhere else). Friends working at Bill Heard Chevrolet a couple weeks back came to work only to find GM had shut them down (GMAC pulled financing from them due to shady practices, Bill Heard shut down all 14 stores). The store is still there, still loaded with new and used cars, with a big CLOSED sign over the entrance. I’ve never seen so many empty or closed car stores, and I’ve been around the business my whole life. It’s true that the business overbuilt (I mean c’mon, 9 honda dealers in the area???), it’s just surprising to see such a big change so fast.
Everyone keeps asking me in hushed tones if I’m “ok”, even customers look at me across the desk and whisper “man, it must be really bad for you huh”. Actually funny as it is I’ve never been better. I’m making great money thanks to a negotiation of my pay and I’m still keeping my overall sales numbers up thanks to my efforts to bear fruit from my customer base….. I found out a few weeks ago I have my first child on the way (with a very wonderful wife) and things in the house of Ncinerate are in order savings-wise thanks to no STUPID housing decisions (thanks to you guys). I’m very VERY alone in this though, just yesterday we listened to the director talk about his APS electric bill he cant afford to pay. Here’s a guy that normally makes 6 figures, complaining because last month he made nothing (and has no savings to get him through).
Sigh, dark days aplenty approaching. The strong will survive I suppose,
Ncinerate
Best wishes for you, thanks for the report, my niece’s husband sells cars in Colorado Springs, they’re upside/down on their house and won’t return calls to any of the family (and no one has said anything to them, just a matter of pride, I think).
Along those lines, on my RV search yesterday in Grand Junktown, Colorado, I found similar circumstances. W. Colorado’s largest RV dealer is closing down next week, has been in biz forever. So much for the oil patch saving everyone. The place that told me this is taking all their inventory on consignment and they haven’t sold anything either. The salesman was a young guy who moved here fleeing the bad economy in Oregon and he looked a bit haunted.
As for my RV fiasco, thanks Tresho and all who responded, am now looking at the trailer route. After exploring the site Cactus posted of RV reviews, those things are far far from the simplicity I want, man, even the slides can fall out while you’re driving! Yikes.
“(and no one has said anything to them, just a matter of pride, I think)”
The Pride Bubble is bursting violently. That will be the most painful bubble of all. Most of my bad decisions have been due to my foolish pride. Pride, like alcohol and religion, is best enjoyed in moderation.
Watch Brian Regan’s skit on the Me Monster (youtube, I Walked on the Moon). Pretty darn funny guy, and I usually hate humor of any kind, except mine.
OK, and yours, you can be pretty funny too. There, see, I’m not proud.
Regan is one of the funnier non-blue comedians out there. I have tapes somewhere from the Len Belzer comedy hour with him on it.
Ncinerate:
My favorite word of mouth comes from critical thinkers like you, that give us outsiders the skinny on what’s what on the inside.
Thanks!
maybe folks are waiting for the bike credit to kick in
As I said before, the really strange thing is SERVICE is suffering.
I don’t think this is strange. Cars that sit in the driveway or street don’t need as much service. People are cutting back on vacations so far less miles on the road.
Finally another section of the population decided to save 50$ and change their oil themselves. Plus they will change the oil less often… bad long term but still not a factor for a number of years.
Could see that result in an easy 35-40% downward swing.
Many people will be self-lubing as cash dries up.
I second that. I used to work at Honda’s corporate headquarters and had access to tons of sales and service data. It’s a common misconception that new unit sales and parts/service are counter-cyclical. I spent a fair amount of energy doing advanced analysis on the topic, and I can tell you they’re not. The fact is if people don’t have money to spend, they don’t spend money.
If senators own hedgefunds would we know about it?
Anger At Wall Street
Weisberg says he understands the anger that many Americans are feeling toward people who work on Wall Street. “I guess I would be angry, too, if I were them,” he said.
“However, I don’t express the same kind of anger when I see the lumps of money that are going out to subsidize farmers to sit on crops. A lot of the financing that farmers, for example, get for equipment and seed comes from Wall Street.
“The credit that they get … trickles down to everyone,” Weisberg said. “This country operates on credit.”
A lot of the financingloan fees that farmers, for example, getpay for equipment and seed comes from goes toWall Street.
—
There, that’s better.
rats. would have been even better with strikeouts
Sorry if thsi gets posted twice but the first time it got eaten.
A bit off topic here when when I turned 50 recently, I was doing some introspection about my 30 years in sales. I didn’t want to go by the way of the dinosaur with technology being way out in front of me. I see my clients ordering less and less of my widgets because of the economy.
For the last month, I have decided to reinvent my career with 3 words. Search Engine Optimization (SEO).(reminds of Dustin Hoffman’s Famous Line…”Plastics.”) Most kids in the their 20’s never picked up yellow pages. They use search engines.
There are ways to make money on the internet if you understand SEO and Pay per Click(PPC). PPC is sort of a huge scam by Google, Yahoo and MSN when you start to undrstand SEO. (It can make you money of you have to do something quickly but I would not make it the basis of any business)
I have been meeting with the top SEO companies in my town here the last month with the express interest of buying part of their business and not only doing SEO’s for clients, but selling their own downloadable products on the internet.
Most of these kids are in their late 20’s and are so busy surrying getting their clients successful through SEO, they don’t have a ton of time nor the capital to try and get rich themselves. I hear stories of how someone’s client was doing a so-so business until they starting SEOing their site and now they are going gangbusters.
One guy’s client make a few hundred thousand a year selling exit signs over the internet. Many times the niche product is the most successful because of the lack of competition.
I am understanding how link building is huge for a site. So is blogging. I now have contacts in India who can do most of this work. You shouldn’t, however, leave an entire SEO project to overseas subbing but you can find the right people in India, Russia and Eastern Europe.
I agree with Ben and many of the other folks here. We KNOW what’s coming and there is a way we can profit whether it’s through the internet or something else. It’s fun to make fun of these goofs who run our country and we will continue to do so but we need to look at profiting.
Baby boomers like myself cannot rely on any Social Security. Like they say in troubling times. When TSHTF, it’s us who we have to rely on. No one appears to want any handouts from Uncle Sam.
Armageddon is coming - Ann Coulter is talking sense. Many of the problems we are facing are the natural consequences of political correctness run amok. Political correctness is nothing more than war against the truth. The other day I mentioned that Barney Frank has a lisp and some moron labeled me a “homophobe”. Barney Frank does has a lisp. Point out crime statistics and you will be a racist. I could go on and on.
We need to kill political correctness. We need to speak the truth. Idiots that immediately throw out terms like homphobe, racist, chauvinist should be treated like the truth hating idiots that they are. White men can’t jump as well as black men. Who did I offend now?
Geezlouise, NYCityBoy, why not just go the whole distance and say that women’s brains are wired different from men’s!!!
(Disclosure - I’m a woman)
“why not just go the whole distance and say that women’s brains are wired different from men’s!!!”
Every man that’s ever been married to a woman knows that is true. I love my wife but I have no idea how women think. It is definitely different. And those hormone things. What the —-?
Barney Frank is a slob and a toad. He’s a complete embarrassment to the US. I cringed every time I saw him on C-Span, wondering what people from other nations thought when they saw this waste of flesh heading up the House Financial Services committee. He doesn’t have a lisp, he has a speech impediment, but so what? Even if he didn’t, he’d still be a complete toad.
don’t kiss him
i liked him on O’Rielly
My dogs nickname is toad. She resembles that remark.
Well, I think it’s true that men and women’s brains are wired different, but that’s just saying when they’re wired at all, which is something that seems to equally apply to both sexes.
‘Geezlouise, NYCityBoy, why not just go the whole distance and say that women’s brains are wired different from men’s!!!
(Disclosure - I’m a woman)’
Hahahaha! Oh, golly, losty, *as I wipe fond tears of giggling nostalgia away* that reminds me of how long ago when you started posting here, shortly after I started posting here, anyway, I thought you were a boy and was getting mildly infatuated because I thought you were so funny and interesting and you rescued and rehabilitated finches and noble stuff like that. I had a vision of some old guy who wandered around in the desert probing for geodes and spouting wise aphorisms, like Moses, a desert prophety sort, except with a neatly trimmed beard and who takes baths. (Ever since my college days I’ve had a thing for older professor types. College was a very formative time for me in so many, many ways.)
Then when you mentioned you were a girl I was astonished and mildly disappointed. Ah, those were the good old days…remember, how the average person was not terrified, the dollar was still up, REtards still walking the streets boldly, trolls were still available to mock, etc? Seems like forever ago!
But to your points: yes, I’d agree that the brains are wired differently. Most men I know are ninnies. But wait, now that I think of it, so are most women. Hmmmm. It’s a poser.
I must conclude that mostly all the basic wiring, no matter what the meat casing, is quite poorly wired.
Yeah, Oly, it’s hard being a woman who has brains and is clever and can really cook good stuff.
I’m talking about YOU, not me, the last thing I cooked was a can of what I thought was hash browns and it turned out to be hash, guess hash browns don’t come in a can, so that made the dogs real happy.
Agree totally, NYCboy. In our country, right now, you have to be accepting of everyone and everything, even if it is plain WRONG!
“Agree totally, NYCboy. In our country, right now, you have to be accepting of everyone and everything, even if it is plain WRONG!”
On the threads there is a spike of bizarre, nasty comments and now we are discussing how women’s brains are wired differently? A tough day and the knives come out. Pretty sad. It’s a bit too much for my poor crazy, emotional, feminine little brain today.
Don’t hide behind “political correctness”, please. If you have a problem with the blacks, the gays and women, just come out and say it. The last time I checked, most of the engineers of this mess were actually none of the above, but don’t let that stop you from a nice satisfying bash.
I am a white guy and I probably dislike white men as much as any other group. Those boys on Wall Street, many of which share my demographic, do not make me proud.
I am so conflicted. Maybe I’m not a homophobe, racist, or chauvinist. Maybe I just hold EVERYBODY accountable, even when they look like me.
“Maybe I just hold EVERYBODY accountable, even when they look like me.”
That’s my standard.
I don’t care about external characteristics. I prefer to judge, when I do, based on actions and performance. Do well and I will praise. Do poorly and I will criticize.
As a white guy, I prefer to refer to the people who created this mess as “THEM”. And by “THEM”, I mean the hordes of ivy-league educated, cocky east-coasters who (as someone here said a day or two ago) were born on third base and think they hit a triple.
You know, it really pains me to say this, but it took a lot of hubris for people to create this mess. And those of us who don’t share that particular personality trait are having a hard time not doing one of the following: 1) rubbing it in their faces, and 2) wishing ill will upon these people (such that they experience what it’s like to live like the Beverly Hillbillies, BEFORE Jed took that miraculous shot with his muzzle-loader).
What I really, really do not want to have happen, is for these people to get off scot-free and continue on with their ego-centric, world-trashing ways. I don’t want them to come out of this with both their pride and their dignity intact. One or both of those two needs to be a casualty. And, they need to learn a little bit of humility, and I hope this little episode we’re going through is going to teach it to them, but I’m probably wrong.
I just can’t get the size of this thing out of my head: if you were to lose a million dollars a day, from the day Christ was born to today, you would come up with a total of a little more than $700 billion dollars. The magnitude of the collective screwup here is just staggering to me. Say what you want about the follies of Central Planning ala the Soviet Union. But did they ever come up with a screwup this big? Beuler? Anyone?
I had similar thoughts when I had a meeting of the minds (first ever!) with Rush on the bailout bill…
I once said Merry Christmas on Dec 23rd to the judge that had just ruled in my favor in a custody hearing some years ago.
My attorney reamed me out, said he was probably Jewish.
That day I knew that the world and were not in harmony.
I am not Christian, go figure.
Watching the rush-rush to get the super-sized Paulson Plan signed in the white house reminded me of any old NFL team that benefited from a botched call on the field and is rushing to get a play off before it can be reviewed upstairs, and overturned.
The voters threw the red flag and the refs just laughed.
HAve-to-ahh vent-
How many times are American businesses taxed to pay for their competition to go into and stay in business? Why is it good that IRS agents operate undercover businesses using your tax dollars on a permanent basis. Think about that the next time a business fails or you get really bad service and it seems the owners could care less. How many businesses are government created and maintained? Ten? One hundred? One thousand? Is there a limit? When our government breaks our laws, why is that ok? What does that teach our youth? Does the end result justify the means? If the law is broken and unintended consequences result such as teaching our youth that in the right circumstances a person should break multiple laws, lie and cheat to obtain a goal, is that a good use of tax dollars? Is that the American way? No wonder so many people today are discouraged to even attempt to enter business and be an upright citizen. Are you ok with this?
I don’t think the talking heads are talking about the speculative and crime aspect of the housing inflation between 2004-2007. To try to blame it on
giving lower down breaks for the striving lower classes is a bad rap I think
to a point .Sure some of those policies did set the stage for lack of oversight in the name of getting more numbers of borderline buyers in for a lower down ,but the Housing boom than turned into a mania where all classes went for the get rich quick nature of the boom . Leverage without qualifying became the investment game because of the excess money provided by Wall Street .
The powers that be on both sides should of seen that mortgage lending was turning into a speculative mania . This aspect of the house inflation was
the biggest single cause of prices inflating from 2004-mid 2007.Homes were sold on the concept of leverage to get rich quick, highly promoted by advertisers and the Real Estate promoters . Real estate always goes up ,get in now or lose out .So,Wall Street keeping the easy money going along with the leverage game concept was the main cause at some point in the false inflation of prices . So, the housing as investment game from Wall Street and industry promoted schemes, promoted by
the fat cats and real estate industry and advertisers for short term gains was more of the cause . It started out as a desire to increase the number of people who could have a chance at ownership and it turned into a crime ridden speculative mania promoted by Wall Street ,advertisers ,the REIC and ,parties gaining short term by a investment scheme .
Until the talking heads talk more in terms of what the housing market turned into ,they are not going to be able to see the real picture .The boom financed the whole business world ,not only the housing industry
but many industries . The crash is clearly the fault of Wall Street .The debt economy is clearly the fault of Wall Street .
Good news is I don’t have to withdraw my entire wells checking account this week, right?
I can leave it in there to pay bills.
Off to splurge at the dog groomers x2.
OT: Ouro, the only time my dogs get groomed is when we’re planning an attack of some kind, then we have a grooming session where they learn exactly who’s the quarterback, who’s running back, that kind of thing (BTW, I’m ALWAYS the QB).
My truck smells of skunk right now cause one of them got sick in the night, threw up, and I kicked her out while I cleaned it up (just water, NBD), and she got skunked. She was NOT having a good night. Me neither.
That would be one time a good groomer would come in handy, there’s a biz for someone, middle of the night skunk grooming (not FOR the skunk, but rather the dog) out in the middle of nowhere, on call. I’d even pay $20 bucks for that one, if they’d do it.
Oh, yuck.
I keep six cans of V-8 juice handy in the back of the pantry for just such occasions. Never failed me yet….
Just a quick comment.
Start going underground, doing work on the side if you live in a big scam ridden, illegal -alien infested megalopolis such as LA. Hang on to your day job as this new GD #2 will get ugly. I will start an underground business soon: still have capital and credit but i will start small. There is a small opportunity niche here in this recession-can’t say much now but it has to do with rehabilitation of foreclosed properties and doing light or perhaps major fix-it repairs on the tons of foreclosed, REO’s, gov’t owned,dwellings here in LA. There is right now a host of folks attempting to survive this GD2 doing off the books home remodels/repairs for cash only.
This is called scraping by/surviving in the new GD.
I went thru a fed jobs training program this summer in basic construction and envirionmental safety certifications and am ready to get into gov’t depression- type infrastructure works programs wearing a hard hat if necessary.
I cut hair for years, got tendonitis and retired.
I can see it now, haircuts in the garage.
Does anybody need an assistant in SD?
Trustworthy soul looking for cash under the table.
OV
Think of all of the out of work tradesmen out there. The competition is fierce right now. A good friend I grew up with is quite a successful commercial contractor in northern CA. When the residential market started drying up, those contractors started bidding commercial projects, undercutting him. There was absolutely no way for them to make a profit even using cheap, illegal labor at the prices they were giving. They are slowly going, or have gone, broke.
Many contractors will let their crew go, and work by themselves, maintaining their license. They will lower their rates until they get the jobs. Most intelligent people will NOT hire an unlicensed contractor because they are not insured in the event of something ugly happening. Think ruptured gas line, etc. And, on the contractors side of things, there is no way to put a lien on a residence for lack of payment. Each side stands to lose way too much. Furthermore, I don’t see banks or any other major asset holders using unlicensed contractors for these reasons, and more.
My opinion is that there’s way too little work for way too many people. It’s time for many in the industry to learn new skills. Getting into contract work right now is akin to becoming a realtor. Good luck.
My brother owns a transmission business and if someone tries to undercut him, all he does is wait for them to go bankrupt. Some folks do not understand basic accounting that you have to charge what it costs to do business. He does well because he is both honest and knowledgeable. Without the expertise, the guarantee he has would drive him out of business, and being dishonest in a small town means word gets around about that so you are also out of business.
Black September looks even blacker through the lens of the rear view mirror.
U.S. loses 159,000 jobs in September, worst one-month drop in five years
Economists say the accelerating pace of unemployment, combined with the most severe credit crisis since the Great Depression, makes the label of ‘recession’ increasingly likely.
By Maura Reynolds and Tiffany Hsu, Los Angeles Times Staff Writers
October 4, 2008
Quotes from economists in the LA Times piece:
Economists say the accelerating pace of job losses, combined with the most severe credit crisis since the Great Depression, make it increasingly likely that the government bureau that determines business cycles will eventually stamp “recession” on this one.
“This should remove any lingering doubts that the economy is in a recession,” said Dean Baker, co-director of the Center for Economic and Policy Research. “The rate of job loss is accelerating and the unemployment rate is virtually certain to cross 7% early in 2009.”
Perhaps most telling was the reaction of Edward Leamer, director of the respected UCLA Anderson Forecast, who has repeatedly predicted that the country will narrowly skirt recession. He called the payroll decline “the first number that is really bothersome to me” and added, “August was probably the first recession month.”
It was worser before BLS adjustment.
The problem with painting so much lipstick on the pig today is the pig is gonna look so much uglier tomorrow when the porcine beauticians run into a lipstick shortage.
No doubt, UCLA Anderson Forecast = the very ultimate in porcine beauticians.
I assume narrowly skirt a recession means we will wave hello to recession as the general depression sets in.
Anderson is a toady. The only good one is the Beacon group with Thornberg!
I call bullshizzle on FHA officials’ contention that the reason no lenders have yet signed up for this voluntary bailout program is because it was just launched. Number one, the program was passed into law July 30; certainly any lender who reads the news has been long aware of it. Secondly, is it in a lender’s private interest to unilaterally write down the value of its loans? I doubt it.
Help For Homeowners
Federal Mortgage Relief Program Up And Running
By KENNETH R. GOSSELIN
October 2, 2008
The most sweeping mortgage relief program in decades — the federal government’s HOPE for Homeowners — went into effect Wednesday as foreclosure filings both nationally and in Connecticut continued to rise.
Borrowers in trouble can apply to participate in the program either by going to the lender that holds their mortgage or by finding another lender approved by the Federal Housing Administration. Lenders can also identify borrowers that might qualify for the program.
In both cases, participation is voluntary.
But the success of the $300 billion program will rest heavily on lenders signing on to the program who are already dealing with a tighter credit market.
No lenders have signed up yet, but on Wednesday officials with the FHA in Washington, D.C., said that’s to be expected because the program just launched. The legislation, part of a broader housing package, was led by Sen. Christopher J. Dodd, D-Conn., and was signed into law by President Bush on July 30.
All this crybaby stuff on here.
You beyotches been pwnd by congress and you don’t have the chutzpah to vote them out of office.
Say it to your self tonight ‘I am congresses beetch’.
It’s all good! Now history will show the notion that the bailout was the last means of saving the economy was nothing but a sham. If the bailout had not passed, doubts about the rescue that could have been would have forever lingered.
SPECIAL REPORT AMERICA’S MONEY CRISIS
Bailout: Little help for homeowners
By Tami Luhby, CNNMoney.com senior writer
Last Updated: September 29, 2008: 3:28 PM ET
AMERICA’S MONEY CRISIS
NEW YORK (CNNMoney.com) — The $700 billion bailout legislation now under consideration by Congress calls for the Treasury Secretary to implement a plan to stem foreclosures by working with servicers to modify loans.
But many housing experts question whether the bill will help struggling homeowners refinance into more affordable mortgages. They stress that the economy won’t recover until the tide of foreclosures stops, and the million-plus foreclosed homes on the market find buyers.
“It’s impossible to know whether it will help anybody but the banks stay open another week,” said Mark Dotzour, chief economist at the Real Estate Center at Texas A&M University. “Until we see a plan to get people to buy those empty homes, we’re just going to go from one band-aid to the next.”
SPECIAL REPORT AMERICA’S MONEY CRISIS
Bailout: Will it work?
Experts differ on whether the $700 billion bailout plan will prompt banks to lend and help the economy. But even if it does, it will take time.
By Tami Luhby, CNNMoney.com senior writer
Last Updated: October 4, 2008: 11:40 AM ET
http://www.smartmoney.com/ahead-of-the-curve/index.cfm?story=Bailout-Will-Slowly-Rebuild-Confidence-in-Markets
The amusing Don Luskin. There isn’t a single person on the planet who has been more wrong (well maybe David Lereah) and yet he still gets a column in a publication that without irony calls itself Smart Money.
Don Luskin is truly an idiot. Every time I see him on Kudlow I want to barf, but I end up watching intently because I’m just amazed at what stupid things he ends up saying. And, his delivery is the best, because he ends up saying it with the cockiest smirk on his face while he’s saying it.
It’s truly just entertainment value. I think that’s why Kudlow has him on so often (for ratings).
“The leaders of Europe’s four biggest economic powers held crisis talks on the global financial meltdown yesterday in Paris, despite disputes that killed off talk of a joint bailout package.”
http://tinyurl.com/42k52o
“Germany’s Economy Minister Michael Glos warned “very well-paid” bankers that they must put their own houses in order and not hope for a government bailout.”
Quite the contrast, for now.
da’, comrades in Europe…
Allow the Swedbank and the Fortis to become victims, and we must continue to blame the ugly Americans that the indulgence of Reserve Currency Status is the most important part of the cycle.
Barclays, Soc Gen, and UBS are solvent, well funded, and backed by a strong European Central Bundesbank.
—
when Europe gets to where we are, thats when it gets really ugly.
Survivorship bias reigns in America.
Haha, Glos is a joke! They tried to bail out Hypo Real Estate, a bank in Munich, just after the elections in Bavaria (The party of Glos lost 17%).
The bailout failed, HRE needs more than the 35bn guarantee, at least 50bn in 2008 and 70-100bn in 2009.
Another report says that Deutsche bank has recently bought toxic waste for cents on the dollar. They now want to sell the crap to the US taxpayer with a huge profit.
Greenspan works for Deutsche bank!!! Voila
“So, if I commute by bike in NYC I get a tax credit? But I also take my life in my hands, forever in fear that some a–hole behind the wheel of a yellow car kills me. But I don’t get any tax credit for using the subway.”
You can set aside up to $160 per month to use transit pre-tax, vs. $240 per year for the bike. Free parking is unlimited.
I ride 3,500 miles per year, and would be hard pressed to spend $240, which would be a tax break of what, max $120? Hardly worth doing the paperwork.
“(i) QUALIFIED BICYCLE COMMUTING REIMBURSEMENT- The term `qualified bicycle commuting reimbursement’ means, with respect to any calendar year, any employer reimbursement during the 15-month period beginning with the first day of such calendar year for reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee’s residence and place of employment.”
“(ii) APPLICABLE ANNUAL LIMITATION- The term `applicable annual limitation’ means, with respect to any employee for any calendar year, the product of $20 multiplied by the number of qualified bicycle commuting months during such year.”
It would seem to be most useful for the initial purchase. After that, it hardly seems worth the paperwork for repairs or storage costs. Even for the initial purchase, what must be documented to show “the number of qualified bicycle commuting months during such year”?
http://www.nytimes.com/2008/10/04/business/04insure.html?ref=business
How is it possible that AIG has already drawn down $61b of the loan that it was given by the Fed?
“The American International Group said on Friday that it had already drawn down $61 billion of the $85 billion emergency bridge loan it received from the Federal Reserve two weeks ago, an announcement that startled credit ratings agencies.
The emergency loan was supposed to buy the company time to sell its troubled assets in an orderly manner. But the sell-off has not yet begun, and now the insurer faces the additional pressure of trying to sell the businesses at a time when potential buyers are having trouble borrowing money.
Moody’s downgraded A.I.G.’s senior unsecured debt on Friday and said it might downgrade other types of the company’s debt, which could make it more expensive for A.I.G. to borrow money and do business.”
How is it possible that AIG has already drawn down $61b of the loan that it was given by the Fed?
I guess they had to set that amount aside right away for golden parachutes for the management, because they will need it fast.
As they seem to be the darling of the Paulson gang at the moment, why not try to get away with a bit more than their friends from Lehman?
It provides even more evidence that there is no way to “bailout” our way out of this. The market will simply have to take its course. The only role the government should have is in the orderly liquidation of failed institutions.
I haven’t seen this posted yet (apologies if I missed it):
http://kcet.org/socal/2008/09/foreclosure-alley.html
Foreclosure Alley (the IE)
SoCal Connected tracked down some surreal sights associated with the crisis - a company that specializes in removing whatever people leave behind in their foreclosed homes. The process is called a “trashout” - a term the company came up with because it perfectly describes what happens. Everything that’s left is dumped in a trailer and taken to the landfill.
This from the comments section (a truly epic post, which I am editing)
Our mortgage has been modified, we are now able to stay in our home for 4 more years….then we can not afford the payments again, what will happen? Is the lenders help in modification of our loan a help, or just a temporary fix? Our goal is to pray the real estate comes back enough to sell and pay our first and second loans of approximately $566,000. My husband is retired, fortunately from the state of California after 38 years, and he has a pension, and will be able to collect Social Security in November.. I have sold real estate since 1986 in the Santa Clarita Valley, a fairly well heeled area with excellent schools, etc.,, so prices were constantly going up. Now I am struggling like everyone else…My husband worries that in four years when we can no longer afford our modified home loan, what is going to happen? Are we going to go through the harrassing phone calls, people knocking on our door…We saw a bankrupcy attorney about claiming bankrupcy, but we have two cars that are paid for, and had paid off the credit cards. We are just house poor!…Other Realtors said I was beating a dead horse, I should transfer title to vehicles to friends or relatives, lies about everything under the sun, and play the system. This was not something I or my husband could do….[the lenders] know we can no longer afford this home, so we either lose the house in a little over four years, or the lender will nedd to work with us again. And in the next four years we are able to stay in our home, with the combined payments of less than we could rent a much smaller property for in the Santa Clarita Valley
It’s like a summary of the mess in one person! “Our goal is to pray that real estate comes back” - oh, dear. What a mess.
One of the items in this bailout bill is a tax credit for those who commute by bicycle
I am so anti-tax credit!
I walk to work. 4 blocks. Nobody has a “greener” commute than I do. So therefore, I will be taxed more to give someone else a credit.
There’s no excuse for anyone to make the tax code more complicated. Every additional tax-credit, $500 tax break for school teachers, tax-free savings fund to save for this-or-that, simply adds 100s of pages to our tax code.
What ever happened to Ronald Regan’s tax return on a postcard?
If you think income tax is convoluted, you should see estate taxes…
we have that (huge) bicycle tax credit in Netherlands (depends on who you work for though). Plus you can deduct a 1500 euro bicycle from income taxes every three years. Seems to be extremely popular at our Ministry for the Environment; everyone claims the bicycle tax credit and still their car park is chock full and there are traffic jams around the office. Of course these gov. workers know that no one checks if you really use the bike, so effectively you get a huge car subsidy; and you can sell the 1500 euro bike to someone else at a discount and still make a nice (extra) profit.
yes, I hate tax credits and other stupid subsidies
We also have a purchasing storm going on at shops selling glasses, because of a tax loophole. If you buy glasses costing at least 304 euros you are considered ‘chronically ill’ by the taxoffice, so you get far more than those 300 euros back from the tax office. And you can do that for every family member, including children! Depending on family income etc. families can save thousands of tax euros by buying some new glasses. Even people with perfect eyesight purchase them. Unfortunately the trick does not work if you are self-employed like me
is there a country somewhere with a shortage of glasses?
“I walk to work. 4 blocks. Nobody has a “greener” commute than I do.”
Me too. We are the best! For selfish reasons in my case, though: I like to walk and I hate traffic (also it is so much cheaper).
“So therefore, I will be taxed more to give someone else a credit.”
what if the taxes come from gas tax or similar? I always thought a tax credit was just a fancy kind of tax break, which you are in favour of, I thought.
A visual of this past week’s Wall Street resonance d’être…
http://www.youtube.com/watch?v=P0Fi1VcbpAI
Hypo Real Estate Bailout failed
The bailout of Germany’s HRE failed. According to Deutsche Bank, the guarantee of 35bn Euros from the German government and other banks has failed.
At leat 50bn are needed in 2008, in 2009 the HRE will need 70 - 100bn EUR.
I think we will see the same story with Fortis in Belgium and ABNAMRO/Fortis in Netherlands next year or so. These banks are now fully owned by the state, so the government is responsible for all unpleasant surprises that will appear in the future.
With all the denial about the EU housing bubble those surprises could get very nasty.
Indeed. Whatever, all these bailouts are incredibly unpopular. And, in September 2009, we will have federal elections in Germany.
Might be interesting. The denial is failing, panic is approaching. We already have all the discussions on TV, if the banks are still safe, which naturally worries the depositors. No bank runs yet, but a lot of people move their money from the big private banks to the biggest bank (Deutsche), which is too big to fail, or to the mutual banks (Sparkassen), or they just open accounts at the federal debt administration (Bundesschuldenverwaltung).
Credible sources report huge deliveries of gold to certain addresses, the SPIEGEL reports that state owned banks have to roll over hundreds of billions of debt, the money markets are still frozen, the junk bond market in Europe has been in deep freeze for months.
On top of that, the CDS bomb is dangerously close to going off. The Lehman default might cost 350bn, and no-one really knows who is holding that bag.
For those of you seeking respite from the market’s whims, I humbly suggest you find solace in Mother Nature’s realm.
She could care less whether your portfolio is up or down, and would ideally prefer you walk up and down her canyons, rather than any back east…
“I humbly suggest you find solace in Mother Nature’s realm.”
If I go get a glass of wine out of the fridge and look out the window into the backyard, does that count? Wine and warm feet are an important part of my solace-seeking activities
Lad i drove to a pretty park yesterday and balled my blue eyes red. Something about nature…
Interesting comment from http://www.getrichslowly.org/blog/2008/10/02/drama-in-real-life-foreclosure/
“You Americans should consider yourself lucky that a foreclosure on a non-recourse debt means that the bank can’t claim the value from other assets and the debt is considered paid in full even if the sale price is less than the remaining mortgage. At least in Scandinavia (and I suspect much of Europe as well) this is not the case.
Over here if the foreclosure doesn’t bring in enough revenue to pay for the mortgage the borrower is still required to pay the mortgage in full. This means that the bank can take a significant amount from your paycheck before you get it or repossess your car or other property.
A lot of people struggled with paying their mortgages for 10 years after the house had sold in our 90’s depression for a third of the mortgage value.
So you should consider yourself lucky that you can speculate on a house investment with lended money with no actual risk if the investment goes sour.”
this varies strongly within Europe. Used to be a bit like that in Netherlands one generation ago.
In Netherlands most mortgages are now covered by the National Mortgage Insurance (NHG), which means that you can never end up in debt if you have to sell your home. If things go wrong, make sure you don’t have a huge savings account (you can keep the first 5000 euros or so, and your car and most other possessions). They can’t touch your income stream after the home is sold. Officially this NHG is only for mortgages up to a value of 265K (equal to median home price), but people use it on piggyback loans (officially not allowed, but seems no one cares). So even loans over 1 million can have zero risk for the borrower …
Another protection is bankruptcy procedures: in Netherlands you can apply for a special debt wipeout program where you have to live on a little below minimum wage for 3 years (no big deal, most people who get into this situation have already lost their official income) and attend some budget counceling. After those 3 years all debts are erased, no matter how big they were. This system is heavily misused by all kind of people who first rake up enormous amounts of debt (by buying and living in a home that is way too expensive, or by running a ‘business’ that goes deep into the red).
Bankruptcy procedures should be similar within the EU, they are based on a EU directive. The “debt wipeout program” is part of the directive, in Germany it takes seven years.
So you should consider yourself lucky that you can speculate on a house investment with lended money with no actual risk if the investment goes sour.”
well why do you think we did it ? And even luckier that foriegners financed the loans because we are all broke.
personally I would like to see all Mortgage walk aways pay back every dime but no we will probably get more bailouts and finger pointing. it’s very inflationary when any bozo can borrow any amount and buy 10 homes for 2X what they should be worth, and then walk away when the RE inflation stops.
I drove by a house that I offered 150k on (listed at $375K). I’ts been for sale for over a year. They’re putting in new landscaping!
BWAAAAAAAAHAHAHAHAHAHAHAAAAAAAAA!!!
Let’s break this down HGTV style:
Labor $350
Plants $400
Flowers $200
Added Value: $1,000,000
Muggy’s next offer: $145,000
Seller Counters: $360,000
(Sound of trunk closing as Muggy loads family to drive out of Florida. Slight, hollow-sounding breeze dislodges ‘Reduced Price’ sign)
dont waste your time.
IF its been for sale for 2 years, maybe throw an ultra lowball, but only if your settled and happy.
ITs easier to find the ones off the market that were once on.
just sayin.
Muggy, I just found out today that the nutcase broad with a litter of kids two houses down from me is getting foreclosed on. It’s a nicer, neat 7 year old shack on 1 acre built around 2001. I heard the inside is trashed (4 dogs, 17 cats, not including wear and tear by kids). The fact that the interior is rumored to be trashed makes for hefty leverage when negotiating. Their posessions are still there but the kids haven’t been getting on the schoolbus for a week now. This is perfect timing because I know the plumbing will freeze up, giving me additional leverage.
I will pull the trigger on this, at the right price, write a check and rent it. I heard it last sold in 2004 for around 400k.
“the nutcase broad with a litter of kids two houses down from me”
My, that is a way with words you have. good luck. Please post back on how it goes. Stories of house hunting expeditions are always entertaining, especially if they involve a “nutcase broad with a litter of kids” 4 dogs and 17 cats!
It used to be hard to foreclose on a nutcase with a litter of kids. My parents sold their first little house to a nutcase, and moved across the state line. Then they had to take it back for some reason a year later because she never paid anything (Maybe she assumed the loan? I’ll have to ask about the details now that I have housebuying excperience). It took a year to get her out of the house. (This was in 1963 Idaho, BTW, so the current generation of deadbeats didn’t invent this tactic.)
After they rented a large truck to haul away all the beer bottles literally filling the garage, they eventually got it sold again.
From the AP Steven Jacobs
NEW YORK - Washington’s financial bailout plan is now law. So the credit spigot will start flowing again, banks will resume lending, and an economic recovery can begin, right?
Wrong. Experts say the most important thing that needs to happen before the $700 billion bailout even has a chance of working: Home prices must stop falling. That would send a signal to banks that the worst has passed and it’s safe to start doling out money again
And thus it will not work, the banks that have a chance of surviving will sit back on their cash and wait for the bottom. Then they will buy up whats left directly or via lending to Hedge Funds. I included this point to all my representatives. Only 1 voted against the bill.
i can’t reply to existing threads from my phone, but this is in response to Oly’s discussion on riding frogs to work. The other day I saw two people fighting after one amphibian cut up another. It was the worst case of toad rage I have ever seen.
Fecking ace ! I’ve just worked out how to connect my laptop to my mobile and use the mobile as a modem to get internet on my PC. It is a Samsung Blackjack.
http://news.yahoo.com/s/ap/20081004/ap_on_bi_ge/financial_meltdown_credit
For bailout to work, housing market needs to mend
By STEVENSON JACOBS, AP Business Writer
NEW YORK - Washington’s financial bailout plan is now law. So the credit spigot will start flowing again, banks will resume lending, and an economic recovery can begin, right?
Wrong. Experts say the most important thing that needs to happen before the $700 billion bailout even has a chance of working: Home prices must stop falling. That would send a signal to banks that the worst has passed and it’s safe to start doling out money again.
…
It also creates a vicious cycle: No trust means no lending; tight credit means it’s harder to buy a home; the more difficult it is to buy or sell a home, the further home prices will fall; and the further prices drop, the more foreclosures there will be.
hoz:
214 bucks.
—————
If you had purchased $1,000 of shares in Delta Airlines one year ago, you will have $49.00 today.
If you had purchased $1,000 of shares in AIG one year ago, you will have $33.00 today.
If you had purchased $1,000 of shares in Lehman Brothers one year ago, you will have $0.00 today.
But, if you had purchased $1,000 worth of beer one year ago, drank all the beer, then turned in the aluminum cans for recycling refund, you will have received $214.00.
———-
I received this messsage only once this year, and it was from Hoz, here.
—-
214 bucks.
Hunting season is upon us. How many deer will be brought home after taking out the headlights?
Just got off the phone with one of the largest retail dealers in physical precious metals in L.A., and they aren’t selling anything anymore, as there is ZERO inventory available on the wholesale market to replace what they have in theirs.
Game Over…
I was told that Safes are in short supply. A little panic you think?
Was it Tulving ?
I went onto Tulving’s website after you posted the above, Aladinsane. This is a very large dealer - 20 oz. minimum gold, 500 minimum oz. silver. I used them when I sold the gold doubloons ( eagles ) from my mother’s estate. I had to sell them several years ago because they had to be divided with my brother/sister, and they didn’t want the gold. Duh. Well, anyway, they’re a very good company. You were totally right - the dealers must be picked clean. Most everything on Tulving’s website is “sold out”, “sold out”, “sold out.” Scary.
Gee — we are out of cash and gold. Who stuck all the money under their mattresses?
Apmex still has some U.S. gold eagle quarters and 10ths at reasonable prices, and a lot of somewhat discounted Mexican gold and some Peace dollars, and 1 oz. Canadian silver maples on backorder until Oct. 7th ( the maples only ). Their fees aren’t bad at all. I am very pleased.
I guess some Harvard economist agrees with my longstanding theory that a key factor behind clogged financial markets is that banks with devalued assets are holding out until they can sell for a premium to Uncle Sam.
Bailout bill more about shafts than building confidence
Terence Corcoran, National Post
Published: Friday, October 03, 2008
No wonder the U. S. is in financial crisis. The wooden arrow, of course, takes up less than a page of the 450-page bill. But it’s symptomatic of a messed-up political system, another reason for losing confidence in the United States, the U. S. economy and the bull-headed statist politicians and demagogues in Congress who obviously have other interests than the economy in mind.
Because beyond the trivial wooden arrow item we have 449 other pages filled with major government meddling throughout the economy for one reason or another. The financial crisis is not a crisis, it’s just another passing express train on which to load political favours, pet schemes and government-expanding ideas that otherwise won’t fly.
The bailout bill itself is packed with dubious solutions to the financial crisis, including the basic scheme of having Washington buy up billions in assets for later resale. One Harvard economist said the current credit freeze “is likely due to Wall Street’s hope of a bailout.”
It seems to me that the $700,000,000,000 bailout will set a value to the bad securities and when that happens, the banks will really pull back on credit, be more careful about doing loans, because the loss will then be obvious. The bailout will do the opposite from what it is supposed to do.