Bits Bucket For November 28, 2008
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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So, today is November 28th. It’s the big day. My guess is that, like so many other BIG days, this day will go by with a whimper. Virtual gold will still exist when we wake up tomorrow.
As I pointed out a few days ago, the futures were rolled into the next contract.
Not much is going to happen.
It’s just another can to get kicked down the road.
At least they will STFU after this.
Sure, and roses will bloom at the North Pole.
B.S. makes for good fertilizer.
Your BS about gold and the COMEX doesn’t seem to have fertilized much.
You’re just a gold shill like the NAR rascals.
meowwww ssss
People, I just want to say, you know, can we all get along?
7 am today:
Parking lot at Wal-mart full
Parking lot at Best Buy full
Parking lot at Mall full.
But I expect this to be the only day where the lots are full. You know that the wealth effect is done when low gas prices are not moving the public.
“Parking lot at Wal-mart full
Parking lot at Best Buy full
Parking lot at Mall full.”
And bank accounts all empty.
aww-full.
I read on a new website a while back that you would not be able to notice a 5% drop in retail traffic, however, a 5% drop in traffic would be devastating.
Compound that 5% drop in retail traffic with a 10% drop in average spending, and it really becomes noticable.
Just remember scam-mart shoppers:
As Mom would say…”if it is something you don’t need, it’s not a good deal at any price”.
This is just to sad.
A Wal-Mart employee in New York state’s Long Island died on Friday when a throng of shoppers surged into the store and physically broke down the doors.
No need to post a link - it all over the wires.
Sigh,
Leigh
Wow, that is depressing.
“A Wal-Mart employee in New York state’s Long Island died on Friday when a throng of shoppers surged into the store and physically broke down the doors.
No need to post a link - it all over the wires.”
I’m sure it’s all an over-exaggeration…
It’s well-known that Americans are kind, considerate and thoughtful. Always willing to help one another, never yielding to tempations and mania-driven behaviors.
Sarcasm off
Scary. I can’t help wondering how nasty it could get if the trigger is hunger, not $300 laptops.
DOC
Truly saddening event, can you imagine how the children and spouse of that person feel?
I hope the security cameras caught footage of an individual or individuals who caused this, so as to press charges. More likely it was just mob behavior with those behind pushing those in front, and everyone was trying to survive to rush.
“…”if it is something you don’t need, it’s not a good deal at any price”.”
Wish I could get my Girlfriend to wrap her head around that one. She’s got more freaking shoes and clothes Imelda Marcos…and still gong strong. I’ve quietly and gently suggested on occasion since 03′ she might take few hundred a month and start up a CD or two for a rainy day fund. No dice. Too many SALES on shoes, purses and other garb for her to pass up. If she loses her teaching job (not tenured yet), she’s going to be hurting. No real savings and school loans up the butt. Oh, but she’ll look sharp…sigh…
DOC
RE: If she loses her teaching job (not tenured yet), she’s going to be hurting. No real savings and school loans up the butt. Oh, but she’ll look sharp…sigh…
Man, you got hurricane size red flags flyin’ all over the place…
Wouldn’t be surprised if a lot of it was just “window shopping”.
Or buy the loss leader and go home.
Ding ding, Al. Each year the news reports how retailers are “heartened” by the traffic on Black Friday but then “surprised and disappointed” that sales were “lackluster” anyway.
Of course, it’s just lost leader sales, leading to a loss. Were you expecting otherwise, retailers and media? Get a CLUE.
People are not behaving like there is a Greater Depression underway. Perhaps Jas Jain is unduly pessimistic?
Friday, November 28, 2008
A strong retail season weighs on today
…
Marketplace editor Paddy Hirsch called in from the Great Mall in San Jose, California. Paddy, what time did you get there?
Paddy Hirsch: I got here about half past midnight, the doors here opened at midnight. We would have got here at midnight, except there was a two or three-mile line to get into the parking lot down the street, so we actually couldn’t get in until half past.
Maybe an alternative view is Fock it my house is underwater my cc are maxed out…maybe i’ll stop paying the mortgage this month, it will be at least 2 years before they can kick us out…save some of it for later…so why worry now.
Weak economy hurts travelers from overseas
Visitors to U.S. likely to spend less money here
By Betsy Vereckey
ASSOCIATED PRESS
November 28, 2008
NEW YORK – Overseas shoppers who once arrived in the United States with empty suitcases to take back their holiday loot may decide to stay home this year amid high-priced airline tickets, unfavorable exchange rates and lingering economic woes.
…
“In places like the U.K., France, Spain and Germany, people there are much more hesitant for the outlook in their own countries, so they’re probably much less likely to take a vacation in the U.S.,” said Adam Weissenberg, vice chairman of tourism, hospitality and leisure for consulting firm Deloitte & Touche USA. “The rest of the world was doing OK through the summer, but October was just dismal.”
“…Overheard on CNBC moments ago, however, was this very interesting tidbit: So many shoppers at a Best Buy in California were paying with cash that the store was running out of change (banks hadn’t opened yet)….”
Cash no credit.
One last consumer orgy financed by the last of their seed corn…
p.s.
What our country needs is a return to it’s Jeffersonian Roots…
http://www.youtube.com/watch?v=zHC9NANKluU
“Cash no credit.”
Worthless fiat American dollars?
Frankly King,
I don’t expect you’ll be receiving a 30-day reprieve from the governor, as the execution will go on as planned.
Fatal Injections have been administered already…
The Best Buy in Bakersfield had 12 tents set-up outside waiting for the doors to open. Go figure????? If you have to sleep outside to be the first one in to grab the marked down goods, you can’t afford it and shouldent be buying.
Same with me. I paid for my new HDTV with cash, no credit. This year consumers will probably notspend significantly less than last year, but use more cash instead.
Nevermind the Bell Curve, viva! Bill Curve
Watching the credit auth systems here at work today. We’re a large retailer w/ brick and mortars + online presence. Approximately half the load on the system as compared to last year.
running out of change
Interesting that shoppers are paying with paper money and not debit cards tied to checking accounts/direct deposit. They must be cashing paychecks directly.
Drudge is reporting that one person was trampled to death and another woman was smashed and miscarried her baby at at Wal*Mart in NY. Sickening.
drudge is full ofsht
The Black Friday shopping experience this year really lived up to its name for some.
Deadly Black Friday: One at Wal-Mart, Two at Toys ‘R’ Us
Posted Nov 28th 2008 4:56PM by Peter Cohan
I have always disliked the moniker ‘Black Friday.’ Explaining that ‘Black Friday’ refers to the day that retailers go from losing money to making it strikes me as awkward — particularly when my first instinct on hearing that phrase is to think of something very bad happening on a Friday.
Which is why today’s deadly events combining shopping for the holidays and death seem so strange and sad.
So, who has the most depressing Thanksgiving story to tell? Bring it on.
We spent time with a small group so not too much destruction. One person told of pretty serious cutbacks at her company, mainly due to malinvestment in the real estate world. Her husband is in the military, having been recalled about a year ago. When his time is up his job won’t be waiting for him. He worked for Citigroup.
I’m just crossing my fingers for Christmas bonuses.
‘…who has the most depressing Thanksgiving story to tell? ‘
Anyone from Detroit.
Anyone in Mumbai.
Last year about this time, I told a score of people the score about what was going down, a wholesale economic Gotterdamrung was upon us, and there was time to prepare still, but only 1 out of the 20 took my message as meaningful…
We had Thanksgiving dinner with those lone believers, their 3 kids and grandma and grandpa.
They blew out their 401k’s last year (would’ve been down 46% if they’d held on) and now see what sort of bullet they dodged.
The payoff for me, was when grandma came up to me after dinner and called me her family’s guardian angel.
“1 out of the 20 took my message as meaningful”
And the other 19 all consider themselves “victims”, no doubt.
Faith is a harsh mistress.
“The payoff for me, was when grandma came up to me after dinner and called me her family’s guardian angel.”
No amount of gold, or cash, can beat that.
Well done, Blano
The payoff for me, was when grandma came up to me after dinner and called me her family’s guardian angel.
That’s awesome. I’m glad you able to help someone.
I really hadn’t tried to talk to anyone in my family. My sister already clings to hope as a plan - she wants to move to NC but won’t lower the price on her house after it’s been on the market for 19+ months. My MIL/FIL was knee deep in the last 2 bubbles and only seem to listen to people who are on financial networks (or the stock broker who sold them Enron.)
I’m not a financial “expert”, so anything I say is looked at with deep skepticism and is quickly blown off. All I can say is I get the myth of Cassandra.
“They blew out their 401k’s last year (would’ve been down 46% if they’d held on) and now see what sort of bullet they dodged.
The payoff for me, was when grandma came up to me after dinner and called me her family’s guardian angel.”
That is excellent.
I think that the only two people that I successfully warned were a married couple that I went to college with. I really do not know their stock/401K positions, but they seemed pretty eager to buy a house in 2004-2005 suburban New Jersey. Not only did they avoid that potential mess, they moved to another rental closer to his Manhattan job (NJ, but not outer suburb anymore) and probably get an extra hour of time per workday for family interaction.
We always hang out at their place for a weekend eating take-out and watching movies when I visit their time zone. I include a visit to HBB and a few minutes of looking at stuff like Professor Shiller’s chart at our informal reunions. C.I.M. , are you reading this?
I may have helped a few other fence-sitters stay perched in Arizona, but most were already content to avoid purchasing. This is because they were bright and lived in Metro Phoenix, where only the truly delusional (or dishonest) denied the housing bubble if one explained it reasonably well for five solid minutes.
I guess that I should have pushed for folks to move from stocks to treasuries/mm in their 401Ks, but I was unsure of how long the illusions would last. Especially from DOW 13K through the DOW peak, I second-guessed myself all of the time. Although I did not act on my second-guessing.
I went to Thanksgiving at a friends mother’s place. She recently got remarried and one of her new step-sons was saying that a manufacturing company in town cut out all overtime and layed off 6 people out of several hundred.
He said his company is still pretty booked out on gas well servicing jobs through early-mid 2009, but by summer the business is pretty bleak. Natural gas and coal mining have helped keep the economy in rural Western PA from feeling much of a pinch from the slowing economy. Housing never really got too crazy here, but there is an oversupply of older homes in an area with declining or steady population.
This area is still dependent upon coal, timber and Natural gas for a large part of its’ employment base. These industries throw off a lot of jobs for machine shops, well servicing companies, railroad and related jobs. Very few people in the area are well situated to navigate a long downturn.
“Housing never really got too crazy here”
I am so tired of seeing such statements. Just because prices didn’t triple in areas, doesn’t mean prices didn’t stay too high for the area. I have yet to see a place that isn’t overpriced. I have been down South, in the Midwest and on the East Coast. There are many places where house prices should have tanked in 2001 - 2007. By staying even they are far ahead of what they should be.
I remember being told Atlanta wouldn’t have any problems because “prices didn’t get crazy”. I rolled my eyes at that one, too.
Any place there are too many homes (Atlanta would certainly qualify) are going to see big problems. No, prices never got really nuts in Atlanta, there were plenty of homes for sale at 100-150/sq/ft (new) pretty much every time I’ve been there (including during the bubble). The problem there isn’t that homes were massively overpriced, the problem is that they built WAY too many of them. So, the price will come down (probably significantly) to clear the inventory. I’d put a price target in the ATL area at ~75/sq/ft (including the land) for a newer home in a decent neighborhood.
the big problem with Atlanta is the McMansions. Too many million dollar plus house built for the transplants. Those types of homes are not necessary here when can find amazing homes at half the price. Those McMansions are being forclosed on left and right. Then are being delisted by the bank for 50% less. So if you bought in one of those new communities you are way underwater.
I’m sure those 400k Atlanta condos won’t help either.
I stand by my comment that “housing never got TOO crazy here.” You can still purchase an older two story home for $40,000 or less. It will be very livable, but not anything to brag about.
There has been some new housing to come to the market, but very, very little spec building. I live in an area that took it’s tumble in the late 70’s thru the 90’s. Should prices be even lower? Maybe, but it is an area that has been cheaper to buy than rent for many, many years.
A couple making $11.00 an hour each, can actually find a way to own a house and have a small family, but wouldn’t be able to live a big consumer lifestyle. I look for foreclosure homes on Freddie Mac, Fannie Mae and HUD in the area and generally find none listed.
I am not saying that even here people are not living above their means, because they are, but it is also relative. I think there are very few areas of the country that will escape this fiasco with no pain. The simple answer is that we continue to consume more than we produce. Easy credit has enabled that for several decades. Turn off the easy credit, and we will see a massive restructuring going thru the world economy.
What ticks me off is that the rewards weren’t shared, but the bill for the party is being spread across the country as a whole.
“What ticks me off is that the rewards weren’t shared, but the bill for the party is being spread across the country as a whole.”
A very understandable sentiment. If those living in California, New York and other wealthy areas only knew how despised they are by those living in rural and southern towns. These outsiders, fresh off making $250-700K off selling their three bedroom split, move in and essentially pillage and destroy localities that for decades have had 1/3 the living standard as oh-so precious and above-it-all New York and California.
The bursting of the bubble has only made things worse. Now, not only do rural folks have to pay for escalating costs at home as yuppies move in, but they also have to pay for the carnage that same Californians and New Yorkers left behind in their wake.
If people in the rural areas (and other parts of the states, and other countries) would stop coming to California, we native Californians wouldn’t be priced out of our own hometowns…and wouldn’t have to move to yours..
When his time is up his job won’t be waiting for him. He worked for Citigroup.
His “job” with Uncle Sam’s Mercenaries will propably last a lot longer than the job at Citi. Just watch out for those RPGs!
Uncle Sam’s mercenaries are from Blackwater; don’t confuse that with service in the military.
“Uncle Sam’s mercenaries”? What a despicable thing to say.
What makes our mercenaries any different than the Hessians in the employ of Mad King George?
A Lad Insane: This doesn’t deserve a response. Just open your eyes, and shut up for change, once you’ve removed both feet from your keyboard.
Why be Incredulous of one’s own history?
We didn’t like the idea that mercenaries of King George III, were fighting his battles for him, and Blackwater is very much our Hessians, as most of the rest of the coalition of the willing, isn’t very much these days.
“The British purchased the services of 30,000 German Soldiers for $150,000, all of which went into the royal coffers of the German princes. These troops came from Hesse Cassel, Hesse Hanau, Brunswick, Anspach, Bayreuth, Anhalt Zerbst and Waldeck.” (from the 1st google entry)
Let’s update this, shall we?
“The United States purchased the services of 30,000 Blackwater Soldiers for $320* Million, all of which went into the coffers of the mercenary princes. These troops came from Hawaii, Florida, Trenton, Bay Area, Rust Belt and Washington D.C.
*They got the ball rolling with a $21 Million no-bid contract in 2003, Sweet!
I love historical record.
Thank you Aladinsane.
Joe Schmoe,
Hope you guys had a grand Thanksgiving! Joe, coming from a family that’s served this country since WWI and as a long time member of the Reserves, frankly… we’re used to it.
During a time of war, we’re mercenaries, after a hard fought peace time ( we’re driftwood feeding at the public trough ) When you’re dead, they want to turn the cemetary into a gated community/golf course.
Sadly, the bottom line is, I can’t make you love this country. If they want to treat the election with the same level of sobriety that goes into voting for American Idol, I can’t do much about that either.
And the same level of fairness, too. Had voters been required to have I.Qs. higher than room temperature, or if political parties had been required to tell the truth and abstain from slander and libel, things would have turned out very different. I don’t think either of the candidates would have been in the running.
Incredulous,
Thank you. Well said.
I have… friends that are mercenaries. There’s a difference. One ran guns into S. Africa while so drunk he blacked-out the entire event. He couldn’t even recall a thing?
But this is just the sort of knee-jerk response that G.I’s roll their eyes at and get back to work. Doesn’t mean a thing.
Oh yeah… and HE was the guy flying the cargo plane! ( Fun guy to hang out with though! )
You’re not kidding about the cemetery –> gated community. There was some debate a few years ago about developing some of the Civil War battlefields on the outskirts of DC — Manassas, possibly Antietam. Developers wanted the open land, saying [paraphrase] “enough with the all the death from the past, we should celebrate life in the present.”
I guess the best way to celebrate life is with Olive Gardens and luxury condos and townhomes! Luckily, I believe the developers lost, or at least were delayed long enough for the housing bust to rescue the memory of the Civil War dead.
My SIL and her husband joined us for Thanksgiving Dinner. We ate chicken and talked about nothing. What’s worse, they don’t drink, so neither did I — depressing indeed!
“What’s worse, they don’t drink, so neither did I — depressing indeed!”
As somebody who doesn’t drink, I find it highly annoying when others choose not to drink on my account. It’s rare, actually, because I’m not a holier than thou type, and don’t mind people who drink. Most of my friends and family members do. I used to love it myself, but made huge changes in my life 8 or so years ago, and eliminating alcohol was one of them. I like people to be themselves. If you like your cocktails, have at it. Just be yourself for crying out loud.
“My SIL and her husband…”
Are they still satisfied with their purchase, or was that your sister?
I am the only one to loose nothing in my family. I rent, and moved everything into Treasuries, moved my 401K into Institutional Gov bonds 401K offering a year ago. My (big) sister, who has lost over 250K in Stock market tells me that in the long run, I will be poor and she will be rich rich rich. She now wants to invest in ETFs with what she has left.
Oh how I love siblings. I swear to g*d she must have NPD or be bipoloar or something.
I lost quite a bit in my 401k - fact. But I’m not complaining. I have 21 years to go to age 70 and a half.
401Krakatoa old chum?
Here we go again. Will someone PLEASE show me what percentage of your AFTER tax income it will take to even have a ‘modest’ income in retirement at money market returns?
Try half.
You know what? With all the incessant whining, let’s just shut down the 401k program altogether. IRA’s too. That way we can all be solely reliant on the Dem’s when we go to retire. It seems to be what everybody wants anyway.
Christ, sack up people.
Christ, sack up people.
Laugh.
That’s both good advice and an effective discussion-ender.
Darn those Democrats, if only President Obama hadn’t created that whole prescription drug plan.
DinOr,
No money at all is being made in MM, Treasuries or any CD less than 5 years. The strategy is simply not to loose money until you can figure out something better or house prices reduce enough to put money there. This is especially true for renters like me 10 years from retirement. I think you are discounting the power of simply not loosing any money. I am now 250K - 300K ahead in buying power compared to the rest of the people in my age bracket by simply not trying to make any money.
It’s “lose” and “losing”, man. Think “lost”, as in don’t have it anymore. Only one “o” in “lost”. There is no such word as “loosing”. You can make something “loose” as in making it less tight. But then you are “loosening” it.
Yeah, English sucks. But all the “loosing” I see on the web is driving me nuts.
Me too. Unbelievable how many times I see that. No wonder
the country is broke.
Thank you, Skwee! That is a huge pet peeve of mine.
As a former freshman composition teacher, I’d tell my students “lose the extra “o”" to try and get them to remember the correct spelling. It helped a little.
But I know it’s the way of the world that in 10 more years this will be viewed as an acceptable alternative spelling.
401K = hidden middle class tax!
I’m done with it.
We have SEP’s, SAR/SEP’s, 401k’s, 401k Simple, Roth’s, Roth 4-0-1-k’s, Traditional IRA’s, S-e-l-f Directed… IRA’s among others.
If you -can’t- find something in there that suits you, then f@ck it. Maybe tax-deferred growth isn’t your thing. Maybe tax-free isn’t your thing. Maybe f-i-l-i-n-g isn’t your thing. I don’t know.
I didn’t loose anything in my 401K. I figured stocks were as overblown as housing. Timing and choices, it’s all a gamble.
After reading that, I lost some places to stand on loose stools?
(end bold)
*sob*
Just focus on not losing your’re principle and your halfway their!
While financial risk-takers may not multiply their money, those who avoid risk will not.
If you don’t take a chance you don’t have a chance.
Financial investing in Wall Street schemes has had dismal results. To make good money one should consider starting a smart well positioned business. I have always believed it’s harder to make a living. It’s much easier to make money.
Does anyone have a netbook? How do you like it? How does the HBB flow on it? Which one do you recommend?
Yes, I have the asus eeepc 1000h, and I love it. There is a lot of hype about the MSI wind, but I think the asus wins hands down just because it has bluetooth and wireless n and a much much better mutli touch trackpad. Plus, it is a lot easier to upgrade the ram and hard drive on the asus. My eeepc has 2gb ram and a 320gb hard drive. I have loaded it up with movies and music, and it will run any software that you want, photoshop included. I put xp pro on it. Battery life is great, about 5 hours. None of them get anywhere near 7.
I would not get the 9″ screen laptops, the keyboards are just to small. The 10″ screen is the sweetspot. Get the asus eeepc 1000h and you won’t be unhappy. Just my 2cents. (One downside, is a lot of people complain about the placement of the shift key, not a problem for me)
OH, final comment. Get the 6cell battery. Its a must have. Also, some people complain about the “fine ebony”, which I have. It is a finger print magent, but it doesn’t bother me. If it does, get the white. Although I think the white is harder to fine.
To be specific, get the 1000h (160gb hd, 1gb of ram, bluetooth, wireless n) Right off the bat, order a 2gb stick of ram to replace the existing ram. I would also order a 320gb hd, but 160hd is probably enough.
Cool, thanks for the reply and the details.
Being in the military looks like a pretty good gig right now. More IED’s in the US than Iraq.
Imagine how our G.I.’s overseas must feel about economic goings on, back home?
The America they left might bear little resemblance to the one they return to…
The America they return to may look more like the war they left.
For the interim ( at least there’s an America to return ‘to’ )
Again guys, G.I’s are used to this. Just ask the Viet Nam-era guys what a “cherry” economy ‘they’ had to return to. We trust there are people a lot smarter than us in charge of this sh!t but they manage to f@ck it up every time.
They’ll find honest work and leave the whining to somebody else. It’s just their nature.
I hope the majority of the soldiers coming home can get on with it like you are saying. Some of the things they experience over there will make it tough, regardless of the economic conditions.
The America we inherited from
our parents bears little resemblence to what went before.
Upstate, brace for impact.
“When Andrew and Brad DeGrazia moved to the Rochester area, they brought a taste of their old home in Arizona with them.
The DeGrazia brothers, grew up in Castle Rock, Colo., and their family moved to Scottsdale, Ariz., when they were in high school.
They both graduated from Northern Arizona University in Flagstaff, Ariz. Brad earned a degree in hotel and restaurant management. Andrew earned a degree in finance.
Brad, 36, worked as a hotel manager in Arizona, California and Washington state. Before moving to the Rochester area, he was working as a mortgage consultant in Phoenix, an occupation he continued here for about six months.
Andrew, 39, had been a regional manager for the T.G.I. Friday’s restaurant chain, but he was working in dealer financing for Chrysler just before moving here from Phoenix.”
http://democratandchronicle.com/article/20081128/BUSINESS/811280317
The swarm is arriving.
There’s been an interesting economic apartheid that’s developed in our country.
If one lived in Cleveland and owned a paid-off house and sold it, where could they move to?
For those that have hung on in the rust belt, the only moves possible now are strictly lateral, and now it appears the lure of the low 5-Figure house back east is winning out converts from out west.
There’s never a winner in a race to the bottom…
What about the idea (and this is just an idea) of retirees moving into the rust belt for the drastically reduced cost of living? Sell a home in NY, move to MI with a huge nest egg? This is kind of the idea that supported homes in FL (well, supported the mythology anyway), I wonder if, with cheap enough prices, that same kind of thing could happen there?
Also, another possibility is those that work from home (which I do). If I could buy a great house in the rust belt that’s very close to an airport for an extremely low price (and I do mean extremely low, think 4,000 sq/ft in a great neighborhood for 125-150K), there’s a possibility they could attract large amounts of telecommuters. Actually, I’m a bit surprised that none of the states have started courting the telecommuters yet (with targeted tax breaks, or other incentives to move to their jurisdictions). I think it’s just a matter of time, as more and more highly paid people start to telecommute, the desire to lure them to one state over another will necessitate incentives.
The Retirees to rust belt move is possible. Likely even when the boomers retire, at least for those with enough of a pension to afford retireing. Because retirees don’t need to live near jobs. But they DO like to live near hospitals/medical centers. And I predict that as healthcare costs rise, those will increasingly be a drag on local government.
My Aunt is an example of this:
She sold paid off home in Long Beach in 2006 for 1.4 Million, moved to Michigan with boyfriend who was from there. Bought home there for under 100K cash. Semi retired, banking the rest of the sales of her home.
Michael, in my post above of going to a friends families place for Thanksgiving is an example of retirees moving back to a RustBelt area and living quite well on their pensions and savings.
Their new condo was bought with cash, and with their combined income they can do whatever they want, whenever they want. Alaskan cruise…done, golf whenever they want to…done…Country Club is right behind their home….Help out the kids…again done.
But both were fairly well to do even before retirement, and moved from higher cost areas. One from DC and the other from Naples, Fl and both moved before the housing bubble peaked.
Pennsylvania is a state that caters to Senior Citizens with all of the proceeds of the lottery going to Subsidized Medications, Rent rebates and Property tax rebates. In my area most people that move back to the area have some sort of connection with the area, but I could see some neighborhoods in Pittsburgh attracting retirees that are looking for Universities, hospitals and relatively safe, inexpensive neighborhoods with public transportation.
Perhaps Oil City PA is a nice place for retirees to move to.
“Perhaps Oil City PA is a nice place for retirees to move to.”
Perhaps, perhaps… is there any one out there who can tell us a little something about what Oil City has to offer?
Where did he go???????
LOL, like large numbers of people from sand states are going to move to Upstate NY (the real upstate - west of the Hudson valley). The all would die the first winter…6 months of steady clouds, 5 months of snow on the ground, and 4 months of sub-freezing temps, plus 10-20 feet of snow. The area is still suffering an overall loss of population, and the net migration of Rochester remains heavily outbound due to Kodak/Xerox/BaushandLomb retirees.
Or are you saying the area is primed for a SW Tex-Mexican restaurant invasion? The area seems ready for that.
My wife is from back east, and one day she asked what was the coldest temperature i’ve ever been in California?
I guess around 10 degrees…
She laughed at me.
“Or are you saying the area is primed for a SW Tex-Mexican restaurant invasion? The area seems ready for that.”
I’m saying that all of these places are primed for a little post-bust gambling. As in a bunch of clowns that are going to make a run at chains that sort of worked elsewhere, to include stupid southwestern huts with too much “Cleverness!” in their menu and an array of unnecessary sauces.
I wonder how many nail/Chinese joints are in the planning stages for Detroit, Cleveland, Buffalo, etc.
To me Moe’s is just another symptom of the bubble; it’s the perfect new strip mall occupant, and priced way toooo high for a freakin’ burrito.
“The swarm is arriving.”
My Pa says, “They ain’t human.”
Section 8! New HDTV! No Security Deposit!
http://tampa.craigslist.org/hil/apa/936607351.html
That’s a winner!!!!
How about this one Palmy?
http://milwaukee.craigslist.org/reo/936313939.html
‘Jupiter Farms’
Actually, it looks nice. (But not for meeeee).
Leigh
I live 2 miles from there.
Quite nice but floody.
Hey, no posting Craigslist Finds in the Craigslist Finds thread!
Seriously, we need a Craigslist greatest hits. Like that $900K shack in California with the “landscaping,” or the $50K rocky island.
I used to post pictures of doghouses for sale for $300K in the Norfolk/Hampton Roads craigslist homes for sale. The replies were always a hoot (before it would get flagged off).
I’m curious if anyone here knows much about reverse mortgages? My mother is apparently looking into them (she’s 65, on SS disability, among other things). My brother is up visiting her this weekend, and meeting with the mortgage guy today.
Is there anything we should be looking out for?
From what I’ve heard the upfront fees are high. You have to have a paid off house. You should be confident that you will be staying in the house the rest of your life. A sale triggers full repayment. I think there are also equity triggers. If the equity left falls below a certain percentage, repayment starts. If payments can’t be made, foreclosure starts. Proceed carefully and fully research it. From what I’ve heard it’s not the panacea Robert Wagner makes it out to be.
Reverse mortgages are heavily front loaded with really high fees, the interest rates frequently are very high, and the overall industry is rife with fraud.
I haven’t seen one yet that was a good deal.
I kind of figured that…and have noticed that sentiment posted here before. I wonder, though, what other options are out there? If she’s got 50% equity in the house (yeah yeah, using which “value”), and while she’s got SS and a small pension coming in, what other options are there to make up any gap between her income and her expenses?
The only other option I see on the table is that my brother and I make up the difference, and at whatever point in the future can get our money back by selling her house. Yes, yes, I know that we should approach it as giving a gift/helping out. I’m just trying to look at what makes the most sense financially for all players involved.
Does she have to stay in her own place? Is living with you or your brother a viable option?
At this point I think she’d rather stay in her own place. She’s still relatively mobile, and has her life up there with her - she’s in IL, I’m in TX (looking to move to WA) and bro is in GA. So, at some point in the future that might be an option, but I don’t think it is right now. Honestly, I’m not a big fan of the idea of mom living with me, but that’s a whole nother issue
So if you and the bro can help her out, just think of it as a “not living with mom” tax.
“The only other option I see on the table is that my brother and I make up the difference, and at whatever point in the future can get our money back by selling her house.”
So, in effect, you and her brother are offering her a reverse mortgage.
“you and her brother” = “you and your brother”
Beast option.
No fees.
We are, in a very crude way. Rather than taking title to the house, though, and paying her money each month, we’re simply making small payments to her to help pay her bills. She’ll still have a mortgage, etc.
Of course, this assumes that my brother and I are capable of making up the difference. I need to get a better feel for what that is, and as Don’t Know Nothin About Buyin No House says below, we might need to consider some kind of contract to formalize things.
I don’t know the specifics, but our cleaning lady is on one in St. Louis and says it was a big mistake.
I really like your solution - get $ back when she sells house. I would meet with lawyer though. Her Will might say otherwise and you somehow need it legal and officially incorporated/coincide with her Will.
Some years ago my mother was in this situation. She could cover all her expenses (with my help) except the drug costs. The Gov has a program where they will pay for the drug costs if they get a lien on the house. She did that program and it works very well. It was through the county goverment and the state was Minnesota. My mother still gets behind from time to time such as property tax time or when their are repairs so it sill costs me money but it works well.
Apparently Congress just passed laws with the Housing Bill to prohibit the fees on Reverse mortgages because seniors were getting ripped off so bad by the wonderful industry . I know some Seniors
that got a Reverse mortgage and I’m sure they paid high fees . I also think the reverse mortgage has a clause that if the property value goes down they can reduce the pay out or adjust it ,but they have different programs . Some people believe that for some Seniors this
sort of loan might be a viable option rather than needing to sell the
house . Of course the heirs don’t get as much because the senior is
burning up their equity to survive or live better ,but isn’t that their right if they want to do it ?
Agreed, Housing Wizard. However, since we’re the heirs, it might make sense for us to lend to her instead of a reverse mortgage company, as we’ll come out ahead in the end.
Of course, one issue here is what will become of the value of her house…presumably, just like a regular first mortgage, the mtg company only has the house as collateral. If the price goes down below the amount loaned out, they eat the difference. We’d essentially be assuming the same risk.
And yes, it’s family, and money really isn’t the important thing. But I’d also be remiss if I didn’t at least consider the different options and different potential outcomes.
Ooops. Forgot to end italics.
Housing Wizard,
Is there (1) angle the loan peddlers haven’t worked? I mean seriously.
I ‘was’ a huge fan of Mortgage Acceleration. It seemed that ’someone’ was finally interested in getting America out of debt. But all the loan peddlers I spoke with wanted fees that were almost precisely what they would’ve gotten had the re-written the loan.
No thanks. Besides they can’t get the HELOC access they’d need to make the pay off pencil out. On to Bi-Weekly and add’l payments!
Yes hope she doesn’t live till 80…What is a bank supposed to do with a 80 year old in a house that’s underwater? Foreclose on her?
Or YOU will have to start paying back the mortgage till she dies….
It seems like a good idea if you are sick not healthy.
I read they can go after the people who deceased willed stuff to for debts.
My $.02…
First, I’m sure you’ve heard of a thing called a BUDGET. Sit down with her and come up with a spending schedule she is comfortable with and commit her to abiding by it. It won’t do you or her any good to extract equity from the home if she ends up short of cash in future years.
Regarding reverse mortgages, there are better ways to accomplish the same thing IMHO. Before I sold my house my last mortgage was a straight 10 year interest only, then 30 year amortized line of credit. This type of mortgage is ideal for someone with a comfortable equity position in a home, and is a straight forward refinance of the home. My bank manager was astonished that I was in the position to set this up, but also a bit envious. If you marry this LOC with a life expectancy and the budget suggested above you reduce the exercise to a simple numbers game. If the numbers don’t work then something needs to give.
Regarding protection for you and your brother, the easiest way to do this is to get both of you put on title. In my view the most important advantage to this is that there can be no additional borrowing on the property without your agreement. My uncle got on title to my grandmother’s home a few years back and it has kept my bad aunt from sucking grandma dry. If you can accomplish this while your mother is still lucid it will save a lot of heartache down the road.
Consult an attorney, etc…
Posted this yesterday, but for those of you who haven’t seen it, “Live in this van and save money”. Question is, who has the five grand to buy it?
http://tampa.craigslist.org/hil/apa/936385231.html
A gym membership will cost about $30 a month - giving you a place to…meet members of the opposite sex.
Her: “So, where do you live?”
Him: “In a van, down by the river.”
Her: “Ha,ha. Yeah, the economy is getting bad. Good thing we havent’ been hit yet.”
Him: “No, really…”
Opposite gender may have a problem with the tinted windows.
-
“It rubs the lotion on its skin. It does this whenever it is told.
Mister… my family will pay cash. Whatever ransom you’re askin’ for, they pay it.
It rubs the lotion on its skin or else it gets the hose again.
[to his dog, Precious]
Jame “Buffalo Bill” Gumb: Yes, it will, Precious, won’t it? It will get the hose!”
Awesome!
The dark tinted windows may be a turnoff to some of the opposite sex.
-
First principles, Clarice. Simplicity. Read Marcus Aurelius. Of each particular thing ask: what is it in itself? What is its nature? What does he do, this man you seek?
Why aren’t you slackers shopping?
Today is the most repulsive day on the calendar.
You can say that again. I’m watching CNBC and all the debt zombies scrambling for “deals” in the mall; it just makes me sick. Hopefully this will be the last Black Friday for a few years where people still have the CC to max out. Maybe then we can get back to the holidays being about family and friends, rather then about Louis V and Gucci.
I have always thought those LV handbags/luggage look so ugly. Everybody still wants them though.
The LV/Gucci has nothing to do with looks or style, and everything to do with telling other people that you can blow 2K on a handbag, or 5K on a piece of luggage (that will be destroyed by the baggage handlers who are pissed that you’re frigging suitcase costs more then they make in a month). I think that most people would agree that the “style” aspect of these bags is nothing special. Coach bags look just like Gucci bags, but cost 1/5th the amount.
These things are status symbols, plain and simple. It’s to show the world that “you’ve made it” and can afford to really just throw money around in a way that most people cannot.
The thing that really cracks me up is when I see someone with a 5K handbag getting into a 1K car. I assume that most of these bags are fake (and I certainly hope so!), but still… If you can afford that kind of money for a bag, you better already have a nice car and a nice house. There’s simply no justification for spending that kind of cash for someone so trivial unless 1-5K is really nothing more then pocket change to you. I feel truly sorry for the women who look at “Sex and the City” as a real model for how to live. Making 50K a year, and spending 1K a pop on MB shoes and the like.. Let me tell you, if you don’t have the cars, houses, watches, diamonds, etc already; even if you really did pay 5K for the bag, EVERYONE will think it’s a fake anyway.
The local news showed a shot of Target this morning… The only “right-sized” person in the place was the reporter, the rest were grossly overweight, every last one of them. Maybe these workout places need to set up shop like a black Friday sale to get the fatties to show up and spend 15 min on a treadmill. Then there is the problem of drool shorting the equipment.
What would future anthropologists make of our overstuffed garages full of crap, that seemed to have been used to store vehicles @ one time?
Why should it make you sick? The real reason is you were hoping 80% fewer people show up for sales? If you don’t like malls on Black Friday stay home - I certainly don’t like to go to malls or best buy or whatever on B.F.
Mikey, Sweetie,
You’ve mentioned Messrs. Weeton and Goochy five or six times now and no one’s taken the bait. So I will.
Not sure if you’re bragging or complaining, but maybe you should reconsider your relationship with this lady? Leather goods such as these are items women generally buy for themselves. YOU on the other hand are to furnish the related jewelry and places to show them off. If you are not comfortable with this arrangement, and her exectations are genuine (and not just of a “how much do you love me” nature,) it’s only going to escalate as you go along.
“This house is in a crappy neighborhood. I want a new one.” “I hate the color scheme in my Bentley…” You get the idea.
Your compromise solution is to buy her a nice Hermes scarf and scarf ring. (Try Ebay.) Be sure to get the authentic orange boxes they come in…sounds like that will be important to her.
I’m going to the gym. No work today. Could care less about shopping.
“Why aren’t you slackers shopping?”
Have you ever seen the shoppers the media interviews today?
I’d rather pay more later.
Exactly. Avoiding the crowds of rude, oblivious people is worth whatever premium I might have to pay to purchase on any other day!
Today is like the Superbowl of Sheep Thrills…
LOL!!
I quit buying shit I don’t need. The shit that I need is not available at the Mall:
Used clothing - Goodwill stores.
Gasoline - Gasoline retailers.
Food - Grocery stores.
Electronics - good used @ Evay, and sometimes free when I haul away and fix it myself, or Evay and fix.
Appliances - free when I haul away and fix it myself.
Appliance parts, electronic parts, lawnmower parts - either Home Despot, my collection of electronic parts, or online sellers.
brake shoes, oxygen sensors, etc… - auto stores, evay, or Ama’s son.
I have not been to a mall in years. Just about all their shit is useless to me.
Sorry to disappoint…
Malls are very useful places to walk indoors when the weather is bad.
Also, we sometimes eat in the food court.
Other than that, we purchase everything in close to the same way you describe. Malls across America would be completely dead if everyone shopped like us.
A friend of mine (who has many years in the restaurant business) told me that the an eatery (of a certain ethnicity) at the local mall was/is/whatever in the habit of using their cutting board as a baby diaper changing station. Every bathroom in this mall has a baby diaper changing station, so go figure.
This may not be fair to all of the other mall eateries in America, but I have quit eating at these mall eateries, and eating out in general. I used to cook most of my own meals, but I am now busier than in previous years, so the next best thing is to buy it frozen and nuke it at home. I do get subs, and similar foods, if I can see it put together in front of me.
I still enjoy walking/running outdoors even when it is cold. I make sure I take my time to get all stretched out, though. Very important, especially in cold weather.
second hand clothes places smell funny. Why, I wonder. It drives me right out. My friend thinks I’m snob but it’s the smell.
Wouldn’t the current cacophoney of ‘respected’ economists all saying pretty much in unison “Nobody saw this coming” mean that we are in the acceptance stage of the proceedings, or still denial?
It means they are all full of s**t. People did see this coming, they were just marginalized and made fun of (the famous Robert Shiller interview on CNBC was probably the most visible example of this). Now that these people have been proven correct, they almost never get airtime anymore. I’d love to see Shiller back with that a-hole and sit there and smile as the moron tries to think up reasons why he is still right.
I’d also like Shiller to be much more direct and forceful when on TV. People always ask him where home prices are going, and he always hems and haws on the answer. The answer is easy (and he is the one who did the research that proves is!), houses (in aggregate) are going down 30-40% from the peak. Areas like LV, FL, and CA are going down ~50%. Condos will go down more, 50-70% in most overbuilt areas.
That’s all he has to say; but, instead, he always gives the mathematically correct (but totally unapproachable to most people) about inflation and housing appreciation. Give them the news Robert. Homes are going down 50%. I’d love to see their faces in CNBC when he dropped that bomb on their heads.
Ya know, if I were Shiller, I’d hem and haw too.
People really can’t wrap their heads around a 50% drop. They get mad, uncomfortable, or think you’re insane. They’ve never experienced it and/or have too much money/time/effort invested in endlessly upward home prices. Therefore 50% drops are the thinking of pessimistic madman.
TV appearances depend on the relative rationality of the speaker. At least Shiller is getting airtime and I suspect just a few clearly stated “50% drops” would cause producers to stop calling.
(Shiller may also be rightly worrying about panic, the effects of which are far worse than what people panic about…)
“At least Shiller is getting airtime and I suspect just a few clearly stated “50% drops” would cause producers to stop calling.”
Bingo.
“(Shiller may also be rightly worrying about panic, the effects of which are far worse than what people panic about…)”
Double Bingo.
Never, EVER disturb the herd.
DOC
A time for humility
November 27, 2008
by Martin Wolf
“…Such a severe depression and banking crisis could not have been achieved by normal civil servants and politicians, it required economists’ involvement.”
This, in short, is a time for humility. Why did we mostly get “it” so sensationally wrong? How did something that looks increasingly like the precursor of a slump creep up on almost all of us this year? It is a pretty good question. It is a pretty embarrassing one, too. It is one everybody I meet now asks. Even Her Majesty has asked why we didn’t do a better job of forecasting this mess….”
http://blogs.ft.com/wolfforum/2008/11/a-time-for-humility/
Of course if your job, as an economist, is to see this coming then they’re pretty much saying “I am incompetent, as are all my colleagues.”
As to your question, if they follow up with their predictions about the turn around by mid 09, then it’s denial. I’d love to hear the line “Sure I missed this REALLY BIG disaster, in fact I denied anything was wrong when a few of my peers started predicting it. But this time, however, I’m right when I make basically the same prediction I made before.”
A few months ago I found myself at a meeting of economists and finance officials, discussing — what else? — the crisis. There was a lot of soul-searching going on. One senior policy maker asked, “Why didn’t we see this coming?”
There was, of course, only one thing to say in reply, so I said it: “What do you mean ‘we,’ white man?”
http://www.nytimes.com/2008/11/28/opinion/28krugman.html?_r=1
Lots of you have a big chunk of $$$ in the bank due to cashing out at or near the “top” of the bubble…
I’m curious if any of you have tried to negotiate the interest raid paid on CDs or the accounts in which you keep your money? I would think it’s possible, but am curious to hear if anyone has tried, and what the outcome was.
When I closed on my house two weeks ago, they wired the funds to my MMA. The bank (Zions) felt the need to charge me a fee for wiring funds *into* my account, which I was able to get them to reverse by threatening to wire the money right back out. So, there’s clearly some leverage that those of us with deposited funds have…
Anyone have any experiences to share?
I haven’t tried to renegotiate interest rates on MMAs, but would be interested in hearing about others experiences as well. I suppose at some level that banks would negotiate to keep deposits, but if that level is over the FDIC limits, the risk isn’t worth it to me.
Like you, we keep “house money” in MMAs and if a bank charged us any fees, I’d be outta there too.
Right now banks are up to their ears in cheap or free money, especially the larger institutions - CD rates are likely headed lower, and negotiating any fees with banks is likely to become more, not less, difficult.
Paul, what you say is certainly true - banks can get cheap money from the FED and as such right now our deposits aren’t as important. But I would hope that the bank manager can see that this will change at some point….the FED rate will rise, and retail deposits will become more important. Do you not think any banks are capable of considering the bigger/longer-term picture?
same story in Europe.
I use internet savings accounts which pay between 2.5 and 3.5% here (not enough to keep up with inflation and taxes), and sometimes 1-3 month term deposits which pay a bit more. I expect rates to go up some day, but the banks are not really interested in negotiating now. Sometimes I can get 0.1-0.15 extra by driving a hard bargain (my savings are probably within the top few % of their customers). Planning to move gradually more of my savings into gold depending on what happens in the market.
All kinds of fixed charges related to having an account are going up every quarter; the banks know that customers don’t have a real choice. You can get 0.5-1% higher rates here from small, mostly foreign, banks; although these now have ‘FDIC’ from the Dutch central bank up to 100K euro, it is a lot of hassle if something goes wrong. Some of this protection may be suddenly removed next year, because the government runs out of money, or because EU officials think this protection is disturbing competition.
We are a “preferred” customer at our bank and
for the last several years have never been charged
any type of fee. We regularly wire transfer
between our Fidelity and TD accounts and our bank.
I know at Fidelity and when it comes to Corporate/Muni bonds there is lots of hokey pokey on what interest rate you get depending on broker working the deal and how much you are investing. I never knew how fluid and black art bonds were - not like stocks at all, with far far less transparency, although Fidelity and others are slowly trying to change that.
Want to cash out my 401k and was told No.
You can borrow 50% from it, or if you have a hardship such as medical but the real answer it your money is stuck. I would just as soon pay the penalty, and find somewhere else to save it/hide it. It is mine, but I can’t get it out.
Banks/institutions have you by the short ones.
Anyone, Bueller,bueller?
Quit your job and roll it over into an IRA?
desert,
you can cash out your 401k. I don’t know how they can stop you. You will take a tax hit. Who said you can’t cash out your 401k?
Most company plans will not let you “quit” their plan as long as you are employed, but have hardship clauses that let you make withdrawals. Read the plan and use the hardship clause if you want to withdraw. It will probably work to say your grandmother has medical expenses. Pay the tax and the penalty.
If you have close to $100K on deposit you have leverage.
When one of my CDs came up for renewal at Bank X, I picked up the flyer at WaMu for the 5% 13 month CD. I walked into Bank X and asked them what they could do for renewal. When they were talking about low 3’s I told them to please close my account and give me my money. After hemming and hawing a few minutes, they MATCHED the 5% WaMu was offering.
So I went down the block to Bank Y. Did the same thing.
If you have a bona fide offer from another bank in writing, it’s amazing how banks will strive to keep your money.
I’m just hoping the pool guys cashed our most recent check before Citibank goes out of business for a weekend. Problems with that kind of thing can put a real crimp in construction progress.
Over-indebted to credit
Many now forced to find ways to break free of spending habits
By Jenifer Goodwin
STAFF WRITER
November 28, 2008
Matt Sauer, a young, single mortgage broker, planned to get rich quick after graduating from college. By age 28, he owned properties in Pacific Beach, Las Vegas and Florida.
Today, the houses are underwater – meaning mortgage debt exceeds market value – and Sauer’s dreams of quitting his job to become a Christian missionary are on hold because of his financial obligations.
…
“Like the Bible says: ‘The borrower is the servant to the lender,’ ” Sauer said. “I am enslaved.”
He, along with millions of other Americans.
Note that the Case-Shiller Index is a repeat sales index, which implicitly controls for the quality of homes that sold. In principle this index picks up the average price change of homes which sold more than once over the sample period, but it does not control for the possibility that many homes currently selling in distress sales are trashed inside.
REAL ESTATE
NOVEMBER 28, 2008, 9:44 A.M. ET
Home Prices Continue to Drop
D.R. Horton Reports Wider Loss
By KERRY E. GRACE and SARAH N. LYNCH
…
For the sixth-straight month, no region was able to avoid a year-over-year price drop. Phoenix and Las Vegas again posted the largest drops, falling 31.9% and 31.3%, respectively. Miami, Los Angeles and San Diego didn’t fare much better, with declines of 28.4%, 27.6% and 26.3%, respectively.
Year-over-year, Dallas and Charlotte had the best relative performance, with declines of 2.7% and 3.5%, respectively.
Cleveland was the one market to show improvement in its year-over-year returns, reporting a price drop of 6.4%, compared with the 6.6% drop it reported in August.
The Case-Shiller data came a day after a government report that sales of previously occupied homes resumed falling, dropping 3.1% in October, as the median price suffered its largest drop on record, and a week after new-home construction took its fourth tumble in a row for October, falling to a record low.
Still, the glut remains, as credit stays tight and the economic outlook remains bleak as mounting job losses have added another layer of stress on American households.
METALS STOCKS
Gold rises; monthly gain biggest since 1999
By Moming Zhou, MarketWatch
Last update: 10:04 a.m. EST Nov. 28, 2008
Hmmm why aren’t there advertisements for homebuilders having black friday sales? If anyone needs to liquidate inventory it’s them.
Hey I heard that one of my stocks that I never sold has cash and 4% dividend and that is better than any bond.
Thank you for tiny miracles.
By the way, grocery store prices are astronomical and a roast chicken in the deli was $11.00. I had coconut shrimp instead.
finance guru’s,
how is it possible DDM and DXD could both be up today?
CNBC cheerleaders talking about Dow at 10,000 by the end of the year. Again I ask: where were they last week when stocks were 10%+ cheaper?
More like 20% - now that we’ve had two years’ worth of returns in four trading days, the experts say we could be setting up for a Santa Claus rally. How many times do you expect Santa Claus to come?
I saw mommy banging Santa Claus.
Depends whether Mrs. Claus is in a giving mood, I suppose…?
Santa comes just once a year, and thats down a chimney. That’s why he doesn’t have any kids.
I actually think that’s a possibility, which is fine by me. If she gets that high, I may take out a loan to short that beeyotch. lol
bluprint,
Pros Say: Start Buying 2009 Recovery
http://www.cnbc.com/id/27927985/site/14081545?__source=yahoo%7Cheadline%7Cquote%7Ctext%7C&par=yahoo
The cheerleaders just might grant you that opportunity!
Where were their brains this time last year when 15,000 was considered a possibility?
Qestion to our resident economists.
How is our current economic situation similar and how is it differnt from Japan in the 90s.
Is our deflation as strong? has it been effecttively countered? can we expect similar results?
Thank you in advance.
The Japanese had savings, we don’t.
yes, but their culture was so different that their govt did nothing and there were no write downs for the first 5 years (patient society = savers). Did this help or hurt
Japan had savings and it had a homogeneous culture. We have no savings and multiculturalism.
so what is the implication of high savings rate? Is it that people continue to spend when times are bad– sort of an economic capacitor or damper?
I am trying to figur if we can expect a similar outcome from our currenn disflation which appears to be turning to true deflation.
The implications is the corollary. Meaning that consumption is lower than production. Excess production probably is in the form of exports. I have a Mitsubishi television that’s 19 years old and a Toshiba a little older. both running well still. And now a Samsung HDTV (South Korean or Taiwan?).
Hoz mentioned above that Americans are paying cash for xmas trinketry, which means people have exhausted their credit and there’s nothing left in the well for them, aside from their meager savings, which they are spending, rather foolishly.
The Japanese had savings to cushion their blow, and they were also the most respected manufacturers of virtually every electric consumer good in the world.
Tiananmen Square happened just as the Japanese Bubble was peaking, and China was not yet a competitor in manufacturing, another advantage in favor of Nippon @ the time.
Japan was a net export nation and we aren’t.
how does that factor in to deflation if it is a world wide problem? It our econmy was in the crapper and others were good ie japan in the 90s net exports would be a great help. Net export may not be as relevent since this is a global problem and the demand is dropping globally as well as nationally.
Bear et al, another question.
has our economy decoupled from housing?
“I have never slept here before to save a few bucks, but with the economy so bad I thought that even a few dollars helps,” said Analita Garcia of Falls Church, Va., who arrived at a local Best Buy store at 7 a.m. Thursday with 10 family members. She bought a Dynax LCD 32-inch TV for $400, slashed from $500, along with an iPod and several DVDs.
“This year a lot of people I know won’t be getting Christmas presents. I have to pay the rent and bills, and I have two little ones at home to think of,” Garcia added.”
http://biz.yahoo.com/ap/081128/holiday_shopping_black_friday.html
So shew blew close to a grand on crap when she could’ve used the money to buy groceries, clothes for the family. Yep people won’t get any presents this year because she is going to buy her own presents.
It’s extraordinary, isn’t it?
Hollywood Celebrities always have all the answers to everything, but they’ve been conspicuously silent about matters economic, and in fact, are acting out their financial demise in a 2-part-act.
1st act: Go on strike.
2nd act: Strike out.
Silence is golden, sometimes.
Hey Aladinsane,
I doubt it’s the big celebs going on strike. The big defect with SAG is that it’s so friggen large. Coupled with the fact that you’re dealing with actors, it makes it the most combustible of all the unions. Going on strike for many of them is not a big deal, as they don’t work anyway. Personally, I think the union should shrink to encompass those who work regularly and semi-regularly. As it stands now, it merely helps legitimize what for many is really just a hobby.
I think the top 1% of SAG members make 99% of the money. For every Tom Cruise, there are 99 members that are waiting tables.
http://www.nytimes.com/2008/11/28/greathomesanddestinations/28auctions.html?8dpc
Interesting article.
Evildoc here, usually from Syracuse and Manhattan.
Visting my brother’s family for the weekend, here in Valley Stream, NY (Long Island) My folks were here too. They just left. Took 30 minutes to get past the Green Acres Mall. Major tie up. Lots of shoppers. Yaaaaay.
Seems the police were visiting the mall, contributing.
My folks tuned in the local radio.
At Wal-Mart, in pursuit of a cheap TV (yaaaay) the crowd of secure Long Islanders tramped a customer. A death resulted. Died being trampled as the sheeple want a TV in bad economy.
Another customer justled and hit. Had miscarriage.
No baby for her. At least she had shot for cheap TV.
Nice.
-evildoc
update…
seems it was an employee killed. Just amazing.
-evil
Excellent. Sounds like the US consumer is alive and well.
Ooops, maybe `alive’ is a tad harsh.
Yeah, it’s one of those “warm fuzzy” moments that makes me proud to live in Consum-O-USA.
YEah, he was trying to secure the doors, crowd pushed them off the hinges, knocked him down and 200 trampled him. People were still going in as they were working on him.
Cant wait for the first food riots.
GreetingsWal*MartShoppers.
woo hoo! Tons of free advertising!
I’m sure all the other stores are envious. (yeah.. I do own a bit of WMT)
3 month and 6 month JGB’s inverted
US tens are 2.94
hoz, you are your buddies must be making out like bandos!
wal mart
come for a cheap tv and die in the process
this black friday crap is sad
i met my 2008 savings goal 3 weeks ago
only 33 more days to exceed my goal
hey am i un patriotic because i save?
yahoo.com/s/ap/20081128/ap_on_bi_ge/meltdown_coming_soon_3
WASHINGTON – The full scope of the housing meltdown isn’t clear and already there are ominous signs of a new crisis — one that could turn out the lights on malls, hotels and storefronts nationwide.
Even as the holiday shopping season begins in full swing, the same events poisoning the housing market are now at work on commercial properties, and the bad news is trickling in. Malls from Michigan to Georgia are entering foreclosure.
Hotels in Tucson, Ariz., and Hilton Head, S.C., also are about to default on their mortgages.
That pace is expected to quicken. The number of late payments and defaults will double, if not triple, by the end of next year, according to analysts from Fitch Ratings Ltd., which evaluates companies’ credit.
“We’re probably in the first inning of the commercial mortgage problem,” said Scott Tross, a real estate lawyer with Herrick Feinstein in New Jersey.
One hope was that the U.S. would use some of the $700 billion financial bailout to buy shaky investments from banks and insurance companies. That was the original plan. But Treasury Secretary Henry Paulson has issued a stunning turnabout, saying the U.S. no longer planned to buy troubled securities. For those watching the wave of commercial defaults about to crest, the announcement was poorly received.
“He’s created havoc in the marketplace by changing the rules,” Rosen said. “It was the stupidest statement on Earth.”
Sorry Mr. Rosen, but all the rules have been thrown out the window. Sorry you haven’t received your wellfare check yet.
http://www.forbes.com/finance/global/2008/1208/038.html?feed=rss_finance
A Plague on All Their Houses
Nathan Vardi, 12.08.08, 12:00 AM EST
Some hedge funds were taken for a $3 billion ride. Could they possibly be as witless as they claim to be?
My first thought after reading this was that the con in question is a bit player compared to BB, HP, BO, etc.
We had a nice thanks giving dinner with friends and then took the wife-to be to see Australia. She smiled, cried and enjoyed it. Good chick movie for a holiday weekend. It was a little too long for me.
Boy, those pesky Islamic Terrorists just won’t go away. They continue to target westerners and attempt to disrupt global commerce. Seems like a great time to dismantle our military, pull out of the battle and make our intelligence agencies more progressive and sensitive. Yeah, that should scare them straight.
Yet attacks on Christians by Hindus outnumber muslim on Christian attacks by 3:1.
The world is an interesting place when retarded ideologies get deep six’ed.
The Muslim terriorists appear to get more press… it’s hard to let go of the images of 9/11.
I’m fascinated by the 9/11 fear mongering from those who couldn’t find NY on a map. They make interesting case studies for researching ignorance and stupidity.