Bits Bucket For January 9, 2009
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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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This fellow Geithner is a crooked as a dogs hind leg, so what ever scheme he cooks up it’s bound to stink to high heaven. Won’t really matter in the long run though, because it will not work the way they hope.
Geithner Preparing Overhaul Of Bailout…
Obama Team Broadens Scope to Secure Final $350 Billion for Rescue
Confronted with intense skepticism on Capitol Hill over the $700 billion financial rescue program, Treasury Secretary nominee Timothy F. Geithner and President-elect Barack Obama’s economic team are urgently overhauling the embattled initiative and broadening its scope well beyond Wall Street, sources familiar with the discussions said.
Geithner has been working night and day on the eighth floor of the transition team office in downtown Washington with Lawrence H. Summers and other senior economic advisers to hash out a new approach that would expand the program’s aid to municipalities, small businesses, homeowners and other consumers. With lawmakers stewing over how Bush administration officials spent the first $350 billion, Geithner has little chance of winning congressional approval for the second half without retooling the program, the sources added.
That challenge is underscored by a report from a congressional oversight panel scheduled to be released today that hammers the outgoing Treasury Department for its handling of the financial rescue, including “what appear to be significant gaps in Treasury’s monitoring of the use of taxpayer money.” The report, moreover, faults the Treasury for failing to properly measure the success of the program or establish an overall strategy and skewers the department for not using any of the funds on foreclosure relief as Congress had directed.
Much of the work by Obama’s team has focused on establishing principles that would clearly define the program’s course and the conditions of government aid to financial firms.
With Geithner leading the discussions along with Summers, who will head the National Economic Council in the White House, the group is devising plans that would use rescue funds to help homeowners avoid foreclosure and unclog the credit markets that finance loans to consumers, small businesses and municipalities. The team is also planning to have the government take more stakes in financial firms, but companies receiving federal aid would have to submit to greater restrictions on executive compensation than were imposed by the Bush administration.
“it will not work the way
theywe hope.”FTFY
Their goals are not our goals.
Precisely.
Their goals are to keep everyone shackled in debt forever. If prices are low enough to be able to BUY something (or pay off the loan for it), then prices are TOO LOW from their viewpoint. “Commoners” should be able to own houses - that’s a “right” reserved for the rich in their sick eyes!
They had an interview with the head of Toyota this morning. He talked about how there were 3 things needed to restore the auto economy:
- Confidence: No mention if this is based on REAL JOBS or just “pie in the sky” BS “confidence” such as “it is different here!” and “real estate only goes up!”
- Interest in the product: Okay, yeah, that’s true.
- Low interest rates: Huh?! How about LOW PRICES?!?! Oh, but you’re not supposed to BUY a car - you’re supposed to lease one or otherwise get a big loan that you can’t afford and pay many times what the car is actually worth to keep the bankers fat and happy!
Argh!
Obviously I meant ‘Commoners should NOT be able to own houses…” Stupid typos…
Good post, PTM. Agree 100%.
Pondering,
The whole focus on interest rates is sickening. It implies that the only way anyone can buy something is with tomorrow’s money instead of yesterday’s. It must be over a decade ago now that I heard a report that Sears made more money from its financing division than from its retail division. I realized that Sears financing division’s profits came out of their customers incomes, with the only benefit to the customer being instant gratification. I decided at that point that I wouldn’t be feeding that machine.
The auto makers need house prices to stabilize at a high level……..if not, it makes their current pricing unsustainable.
People are going to have a hard time justifying the purchase of a $40-50-60K car or truck, when you can buy a pretty decent house for $100-120K. Especially when you consider all the incentives they are throwing at home purchasers, vs. the almost punitive penalties you get (depreciation, property taxes/tag fees, insurance, etc.) when buying a new car.
Unlike (as it appears to me) most of the folks on this blog, I like cars, and wouldn’t mind buying a new one. But the price of playing the game has gotten too high in the last 6-7 years.
People are going to have a hard time justifying the purchase of a $40-50-60K car or truck, when you can buy a pretty decent house for $100-120K.
And especially if your HH income is only 60K. Without magic home equity loans even a 20K vehicle is pricey for the average joe.
The prices on new trucks are absolutely delusional. A loaded 1 ton 4×4 was pushing $60k last time I checked. That’s insane- especially considering the continuing cost of repairs due to substandard engineering.
I saw a new Cadillac Escalade Hybrid the other day.
MSRP? Almost $70K.
If the turnaround plan of the Big 3 assumes that they are going to be able to sell a truck for that price, they are Fooked.
” saw a new Cadillac Escalade Hybrid the other day.”
Turning Beheamoth Escalades into HYBRIDS?
Are you freaking kidding??? Talk about the ultimate insult to one’s logic.
DOC
Exactly.
The whole aim of the banking industry is to make it appear as if as many aspects of our lives are reliant upon them as possible, in order for them to extract as much money as possible, or in many cases to even justify their existence. I have no problem with this actually, as it is normal marketing tactics for any industry. However unfortunately the banking industry has the power of government on their side, and the power of the entire money system as their weapon. Other industries are disadvantaged in that they have only some of the former, and none of the latter.
That is why so many industries attempt to break into the banking market - to try and get a portion of that pie. Wal-mart is getting into banking. The auto makers have been doing it for years. Retailers do it with credit cards - etc. etc.
Hence the “credit crisis.”
To me, there was — and is — no “crisis.” I hate debt, and would love nothing more than to see prices fall to levels where regular people can afford to buy things with their savings.
It amazes me that Harvard economics faculty members are such big proponents of economic governance by central planning.
Somewhat analagous (to me) to the scientific/academic cheerleading about man-made global warming.
Not at all analogous. Global warming is measurable, real and anthropogenic. And not political (even though people try to make it that way). I’m a climate scientist and I think that they’re all bums!
MrBubble
PS: I can understand if you think that I “believe” in global warming because it’s where my bread is buttered. However, I’d be pretty effing famous if I could disprove it. Unfortunately, 1) it’s not as simple a falsification as putting a piece of litmus paper into a liquid to determine its pH and 2) the preponderance of evidence (correlative and causal) is in the global warming camp.
You conveniently left out the word man-made.
Mr: Bubble: please explain how all the other times the temperature has risen were caused by Man, since Man was not even here. It has only happened about a million times, so it should be easy for a smart fellow like you.
That’s what “anthropogenic” means. Sorry for the confusion.
MrBubble
Uh. Wow. Looks as though you’ve got me there! And awesome job on the “it should be easy for a smart fellow like you.” Well played, sir!
But seriously, the other temperature (and greenhouse gases — GHGs) fluctuations were not caused by man because the genus homo was not around to cause them, of course. Actually, we didn’t have the power to cause them for our first million or so years. Only when we had the requisite numbers and technological ability did we begin to dump massive amounts of GHGs into the atmosphere. [Aside: if you are thinking that technology got us into it, so technology can get us out of it, I would draw your attention to the I = PAT idea]
We can tell that some of these gases (like those emitted from the combustion of fossil fuels) have been emitted by us through their isotope ratios. Other quantities have been emitted through land use changes, etc. which can increase the rate of soil organic carbon oxidation, for example.
You could also just calculate the amount of fossil fuels that are being burned presently and sources and look at the atmosphere’s, oceans’ and soils’ ability to act as sinks (e.g. look at the acidification of the oceans as bicarbonate entering the system from the atmosphere) and determine that the numbers don’t work in the sinks’ favor, at least on a human time scale (silicate weathering will take over, but that’s on a much longer time scale). This last paragraph is not as clear as I’d like it to be, but perhaps you get what I’m saying?
I would draw your attention to Ramanathan et al., 1985 for further explanation for trace gases and climate change. Actually, you could go back to Arrhenius, 1896 for the original thesis that CO2 could cause global warming. Archer’s book can give you more on how the physics of GHGs operate.
The CO2 concentration in the atmosphere has fluctuated throughout the Earth’s history, it is true. And we are at a low value currently when you look at the records throughout the Cenozoic. However, at 385 ppm CO2, around a hundred ppm higher than at the start of the industrial revolution, we are essentially back in the Pliocene with respect to our atmospheric CO2. Now without CO2, it would be too cold on the planet. But too much? That’s a scary time and place to be.
MrBubble
Very eloquent, MrBubble! This is easily one of the most informative posts for me on hbb.
Well, it’s way off topic anyway! It’s just so hard getting global warming deniers to understand that they are like bubble deniers — wrong, already irrelevant and on their way toward the dustbin of history.
MrBubble
This idiotic ploy is bound to make future lenders very anxious to underwrite mortgage loans! LMFAO!
MORTGAGE MELTDOWN
Citigroup supports measure giving courts big say on mortgage reductions
The lender agrees to support letting bankruptcy judges lower the principal owed on ‘underwater’ loans.
By James Oliphant
January 9, 2009
Reporting from Washington — For the first time since the housing crisis began, a major mortgage lender agreed Thursday that courts should be allowed to order reductions in the principal of “underwater” loans for some troubled borrowers, cracking what had been fierce and unified industry opposition.
The agreement struck between congressional Democrats and Citigroup Inc. would permit bankruptcy judges to change the terms of mortgages as part of court-ordered debt restructuring. Democrats hope to include the provision in the upcoming economic rescue legislation under negotiation between Congress and the incoming Obama administration.
The suggested change in the nation’s bankruptcy laws has been repeatedly proposed — and defeated — in recent years.
Under Chapter 13 of the U.S. Bankruptcy Code, judges currently have the right to reduce the principal of auto, credit-card and other loans but cannot reduce the principal on a primary mortgage under any circumstances. As a result, homeowners who go into bankruptcy often wind up with mortgage payments that are even higher than the ones they had before, after skipped payments and other fees are added to the principal.
Some housing experts and many Democrats blame this unwillingness to reduce the principal on mortgages for the difficulty that many homeowners have had as they try to modify their mortgages and avoid foreclosure.
But giving bankruptcy judges the power to “cram down” mortgages has been opposed by congressional Republicans and mortgage lenders such as Citigroup, who have warned that it would make providing loans riskier and, because of that, reduce the amount of credit available to buyers.
So, would the judges reduce the mortgages to the point where you are not underwater? Interesting. Won’t this further reduce the price of housing, causing more people to be underwater?
This is an important question.
Any principle cram-down should automatically flag the property as a recorded sale or transfer, so it could be used as a comp for future sales. The original sales prices were never true prices, because the buyers never had the intention of actually buying the properties (paying them off) in the first place.
VERY good point, CA. Your post just woke me up to something, though, and which is that as long as people keep trying to fudge the numbers, muddy the waters, avoid clarity and transparency, the mess will continue relentlessly. Because that’s what got us into trouble in the first place, lies and spin and byzantine schemes, whether legal or not.
Politicians keep bloviating about a lack of confidence. Hell YEAH? Truth, clarity and transparency are the way to confidence. But these idiots wouldn’t know a truth if it sprang up and hit them in the bazoo.
I have no confidence in THEM. (I’m disgusted because I watched Maxine Waters on C-Span yesterday. Raised my blood pressure about 75 points. Wow, just…wow. I’m surprised the woman can even function, her words made about as much sense as “when the bell rings, the air outside will turn green”. I might as well go to some insane asylum and listen to one of the inmates, it would make more sense.
It also will provide an incentive for people who can afford their mortgage, but now realize they paid too much for their house, to simply walk away.
If you’re only 5 years or so into a 30 year mortgage, and could buy the same house for $150,000 less down the block, and your neighbor just got a cram-down, then the only thing to do (and it’s perfectly legal and little repercussion if it’s a non-recourse mortgage) is to walk away. Just do the math.
If there ever were a textbook example of a “moral hazard” then giving deadbeats cramdowns is surely it!
IIRC, when BK judges write down debt, you don’t get to profit from it! If a car company repos your car, sells it, and then says you owe $2000 more to cover the debt, that’s the sort of debt that a BK judge could cram down. You don’t get to keep the car, and the lender figures he’s better off getting something than nothing.
We’re already excusing income tax on forgiven mortgage debt (a tax cut probably worth $1 Trillion when all is said and down). Isn’t that enough of a cramdown?
I just learned this: a family I know was able to modify their loan (they bought at peak, of course). I don’t know the details, but here’s the worst part: they plan on buying a new home (because they “need” one) and will rent the house they just got the modification on. If they can’t cover the PITI, or find a renter, they’ll let it foreclose. I know for a fact they make enough money to cover both homes.
So there you have it, what I am seeing on the ground is that these “workouts” and efforts to “help families stay in their homes” are merely enabling binge home buying behaviors from the glory days.
The gamers are still playing.
Have they actually been approved yet? Seems to me that someone who had a modification was most likely behind on their payments. If that’s true, they have a low FICO and won’t be approved for another loan. At least not one for a second home.
My buddy got a mod. He’s 50 and got a 40 year loan. He’s still in a world of hurt with his 600k ranchero.
How much of a cram down are we talking about here?
5%, 10%, 25%, 50%, 90%??
No clue, the public records doc is “in progress”
To qaxbami’s point, so many of these mortgagees cannot even afford paying on the current lower value of these properties. A guy making $50K owes $500K, the house is now worth $300K, but he can (based on normal ratios) only afford $150K. Do they lower his principal to $150K?
Also, if someone took out a HELOC and bought a couple of luxury cars and a boat, wouldn’t a bankruptcy judge take those away before giving them a principal reduction? Unlike a foreclosure, don’t all of someone’s assets become up for grabs in a foreclosure?
Should have read “don’t all of someone’s assets become up for grabs in a bankruptcy”?, sorry.
There is no lien on the toys if you bought them with HELOC money, so maybe in a Chapter 13. Toys would get sold in a Chapter 7. I’m imagining the judge asking how you bought the toys and if you say HELOC he’d be discussing loan fraud and tax evasion. Don’t you have to promise HELOC money is for home improvement, or did that go away in the crazy boom years?
Don’t you have to promise HELOC money is for home improvement
I’ve never heard that. The credit is based on the equity in your house, I wasn’t aware that anyone cared what you did with the money.
This condition is about how the HELOC will be taxed, if you state that the monies are for property improvement, health debts or education; you don’t get to have your HELOC taxed as ordinary income.
Otherwise, you have to pay the taxman their share of ordinary income. This is something that a lot of people did not realize and will come back and bite them.
The first $100,000 of HELOC money not used for home renovation is still deductible on your Schedule. All HELOC money used to upgrade the property is deductible (with the million dollar loan limits of course.) But you can spend $100,000 on hookers, beanies babies and a new chest and it’s still deductible.
However, if you pulled more than $100,000 out the IRS is starting to backtrack where the funds were spent to make sure you are not taking a bigger deduction than you should. Will be a big audit point this year and trust me, the smart tax preparers are asking a lot more questions about how the money was spent and making the client liable (not the preparer) if they decide to lie and deduct more than they should. Fun times ahead.
Two hunches:
1) The REIC will collectively work hard to prevent crammed down values from becoming common knowledge.
2) REIC insiders will figure out a way to obtain the information and exploit it to their personal gain.
The lender agrees to support letting bankruptcy judges lower the principal owed on ‘underwater’ loans.
——————————————————————————
Defaults will increase as everybody will want their mortgage restructured. why should only the FB’s be allowed the privilege of having their mortgage restructured? damn, obamey…..I want a piece of that pie too.
A falling tide lowers all boats. Principal has to be reduced to point where you are not underwater. If you are underwater just a little, you are still drowning.
I think they are planning to make the provision only apply to mortgages made before the law is signed, but the idea that they can promise that they wouldn’t just do it again (remember the already modified ones are failing too) and make the banks really believe it is laughable. Talk about a real credit crunch….
If faced with the threat of a cram down, perhaps the banks would then only loan to people who make downpayments, and only at fixed payment levels that are a moderate percent of income.
Remember, if it’s a conforming loan they can sell it to Fan and Fred. The only threat is to non-conforming loans, and those that crash and burn within a year.
Schummer is such a an idiot. I think I heard him say it was only retroactive. That’s nice, change the rules on people after the loans are made. What an idiot…. I wonder what Citi got in return, not that they didn’t get a lot already!
Everyone will just stop paying to get a cramdown.
This is sooooooooooooooooooo doomed to fail.
Could they really do that if they in fact have the money? I’m not very familiar with bankruptcy proceedings, but wouldn’t that type of move be very obvious to the judge?
The point about judges is important. A judge will have to look at all facets of the loan and the FB. Not only will that expose lots of shady dealings, but it will take time.
How many loans per day were those crack-snorting mortgage “brokers” appoving? 5 loans in on day? We’ll be lucky to see 1 cramdown in 5 days. This will run out the clock.
I can’t wait to see how this social engineering scheme plays out (rubs hands with glee in eager anticipation…).
I represent solid local banks which try to do work outs when it make sense. I can tell you that in Bankruptcy Court all sorts of appraisers will show up, working strictly for Lawyers who represent Consumers who filed, claiming ridiculously low valuations. Who should the Judge believe? The time, expense and cost of this provision will be devastating, perhaps that is what they want?
“…claiming ridiculously low valuations.”
One man’s ridiculously low valuation is another man’s market value. So far, I don’t see any evidence that used home sellers in San Diego (including banks) have faced up to the reality of market values below $200/sq ft.
“A judge will have to look at all facets of the loan and the FB. Not only will that expose lots of shady dealings, but it will take time.”
Good point, Oxide. It will be interesting to see what happens when, in the course of reviewing the mortgage papers, the judge notices that the stated income on the application doesn’t exactly match the rest of the information the judge has been fed.
Judge to FB: Here are the new terms of your mortgage… and here’s your indictment for fraud!
Judge to FB: Here are the new terms of your mortgage… and here’s your indictment for fraud!
—————————————————————-
and while we are at it co-indict the bankers that loaned the money as accessories to fraud. the banks were reading the same mortgage papers that the judge was reading.
To be very fair, if they didn’t say it was only for loans that have already been made, the banks would never make another loan that they couldn’t sell to the government without a 50% downpayment or more. I think it will gum things up even with the “new loans aren’t subject to this” clause, but that is the reason for it.
‘The lender agrees’
This is all you need to read to know this cram down talk is a joke. If they agree, it isn’t forced. Loan modification is as old as lending itself. And contract law is 3 times as old as the US. It can’t be invalidated in part because that invalidates all of it.
I find it amusing how the media and some internet clowns get excited by every new ‘plan’ that gets ‘announced.’ For example, you might hear that this company or that has a moratorium on foreclosures. But then why do I see these same companies foreclosing on houses locally,
every single day…?
Here an idea; don’t waste so much time watching what is put out for public consumption, because it isn’t what is happening on the real foreclosure scene. I work with foreclosures every day, and I can tell you that what is ‘reported’ has almost nothing to do with the facts on the ground. One more thing; if what I see here is any indication, there are a lot more houses in default than is being admitted.
“what is happening on the real foreclosure scene” - which is what? Inquiring minds want to know.
Thank you , Ben.
Trust our fearless blogger to pick out the very important phrase that the NPR report I heard this morning totally left out.
“I work with foreclosures every day, and I can tell you that what is ‘reported’ has almost nothing to do with the facts on the ground.”
Awesome, but somehow unsurprising.
“One more thing; if what I see here is any indication, there are a lot more houses in default than is being admitted.”
I would have guessed that from eyeballing the ‘moonshot’ San Diego foreclosure graph that I have pinned up to the wall:
.
.
.
.
.
…….. .
. ………….
1990 1995 2000 2005 2010
Sorry my graph flubbed…need FPSS to provide a tutorial on white space.
Linking to this guy perhaps?
“this guy”
Thanks! The foreclosure rate plummeted due to the foreclosure moratorium, yet still remains stubbornly higher than at any point in history prior to the current episode.
wonder what Citi got in return
My guess - Big gov approved banks will get some sweetheart tax break the suckers that bought their MBS will get the shaft.
Well, I guess the solution to that is that the govt. just takes over all the banks…..Oh, wait a minute!
“I think they are planning to make the provision only apply to mortgages made before the law is signed,…”
Discrimination! There will be a great payoff to those who were foolish enough to buy back in 2005.
Will it be possible to include the implied value of homes whose owners’ mortgages were crammed down with the local comps? Where would one obtain such information?
Potential buyers will certainly want that information. Plus this will be a moving target, with valuations going progressively lower over time.
If Citi is like most banks, 80-90% of their loans are securitized and owned by investors. Citi funded by Gov is likely paying off the investors to get them out of the picture so loan reductions can move forward.
In an unrelated story…
Wall Street Journal
* BUSINESS
* JANUARY 9, 2009, 3:15 P.M. ET
Rubin to Leave Citigroup
Robert Rubin, the former Treasury secretary who has been sharply criticized over his role in the financial turmoil at Citigroup Inc., plans to leave the bank and has submitted a letter of resignation, according to a person familiar with the situation.
This is fun. The folks over at the NASDAQ have created a new index, OMX Government Relief (^QGRI), to track firms that have been bailed out by the government. The index will track, with equal weight, companies of at least $1 billion market cap, that have come to Washington cap in hand. It’s mostly TARP companies, but not necessarily all. The index, which was set at 1,000 on Monday, is already down to 941.42.
” is already down to 941.42.”
Be patient, FPSS, they haven’t figured out how to fudge that figure yet. They are still appointing panel members for that committee, and since all of the FNM and AIG employees are away on massage retreats, they haven’t had time for their assistants to check their blackberries.
Where’s the triple-short ETF, I ask ya?
LOL
Wouldn’t FAZ pretty much get you there, minus the automakers, of course?
Palmetto and Muir:
This one is simple, or I would not ask. Where in Florida, would you move to if you wanted nothing top do with Miami, meth-heads, and adjacent unknown problems re property, were renting, and wanted to be w/in 45 minutes of the ocean, with job prospects as a paralegal, eventually to take Florida Bar, maybe? Age 53, thanks again for previous replies. Love this site.
Hi, Ate, I’d take a Florida map, target the area between Ponte Vedra and Ormond Beaches, move my finger inland a little and research those areas between the coast and the St. John’s River. Avoid anywhere south of Daytona, but I can’t guarantee you won’t run into meth heads. Unfortunately, I think Jax has got them, but at least if you live near Jax/St. Augustine, you’ve got a good chance of prospects for paralegal work, seeing as how it is a major metro area. You could also live in Seminole or Volusia counties and commute to Orlando, but as far as I am concerned, that would be hell.
Your best resource would be to ask Paul in Florida, one of the posters here who lives in the Jax area.
Palmy,
How bad or tolerable is the commute between that area and J-ville?
Dunno, that’s why I suggested Paul in Jax put in his two cents. I’m only familiar with the commute between Seminole and Orlando. I have in fact heard from one guy that driving in Jax is a nightmare, too. But St. Augustine is a different matter.
There is definitely work in that are you pointed out, specifically Jax. It’s rumored that private schools are a must in consideration of the public system. Can you comment on that?
Use google earth to get a sense of the area.
Traffic in certain areas of St. Aug is a nightmare b/c of tourists. Likewise for certain areas in Jax; however, it’s b/c of poor traffic flows — Orange Park Blanding/295 area and JTB/95 intersection coming from downtown. Depending on what area of town you live, traffic is not an issue. So, choose wisely.
There are some decent public schools in Julington Creek/Fruit Cove area.
Paul hasn’t replied, so let me assert from my personal experience that JAX roads are a nightmare (kind of like Baltimore, except you get the feeling that chunks might fall off at any moment) and St. Auggie is way, way too small for anything not tourism related to prosper. (I expect to see some real pain there next year–it’s a cute, quaint little place but much too dependent on tourist dollars.) Driving in that area is a pleasure because it’s rural nowhere (except where Lennar has put up ugly houses).
I think the money in JAX lives in Orange Park, not JAX proper, which, but for the financial district (lol), is more or less a pit. (Think Baltimore, but with less amenities for white businessmen, I guess because Balto is better at sucking down state dollars for glamour projects for the local pigmen. Fla is a very big state.)
Any reason you have your heart set on Florida? Why not Savannah, GA or the NC coast? (SC’s collapsing like Naples, FL–avoid.)
Outside of Hotlanta, GA is too assbackward. Don’t like their rotten history either. SC is just as mean, ignorant and hateful. NC has been a destination for northeasterners going all the way back to 1995(It’s different there) up to very recently so reality hasn’t hit them between the eyes like it has FL.
The money in Jax is east of the river not west in Orange Park. It’s in Fruit Cove, Southside Deerwood, Ponte Vedra, and some in Fernandina Beach.
I agree with Palmetto.
Although, you could check further south, (after skipping Daytona) past Melbourne Beach on Indian River.
A house on the beach (barrier Islands known as the Intracoastal) can be had for 200K. Insurance is a headache.
Someone here a while ago suggested a small 2/1 on the beach in Ormond beach for under 70K and going bareback.
I liked that idea and pre-1999 prices support that he wasn’t making it up, those are the prices.
The thing is your lifestyle, although beautiful, don’t expect a big city life.
Glad you like the site, thank Ben (cash is good)
I rented at Jax Beach for a year, then Ponte Vedra Beach (just a couple miles south) for a year, but now I live 250 miles south in Martin County, where I bought a place. I like it here, other than having added 500 miles to a commute I make about once every six weeks.
I agree that PVB down to St. Augustine is a good location. Jax Beach/Neptune Beach/Atlantic Beach is also nice.
There is a big difference between the weather in Jax and the weather at Jax Beach. When you’re that far north in Florida, you will get a lot of nights in the 20s inland. On the beach it is unusual - we only had one frost in two years. If you live north of halfway downstate, I would strongly advise living near the beach to get the more tropical climate.
I like the warm to hot climate and 365-day growing season, and so am at the northern reaches of that, 100 miles north of Miami. I like it here, but I think the economy is probably a little better in Brevard County - Melbourne/Cocoa/Palm Bay area. That’s an area you might consider. Also close to Orlando.
If you live south of Palm Beach in south Florida, it is pretty urban all the way to south of Miami.
Personally, I much prefer the Atlantic to the Gulf.
45 minutes from the ocean is actually quite far in Florida- you can easily live east of US 1 anywhere N to S and be within 30 minutes or less from the ocean.
Ate, that’s the second time you paged them and not me. You’re hurting my feelings!
St. Pete Beach
St. Pete Beach is nice, but I thought he wanted to be near the ocean, not the Gulf. Maybe he just means near the water.
Good catch. As usual, my reckless reading…
Also tons of homes for sale, at least last time I was there (two summers back)…perhaps the inventory has subsequently tightened up?
I’m not Palmetto or Muir. However, I live in Pensacola which is located in the panhandle area of NorthWest FL. Beautiful area. Also, you may want to consider Tallahassee, the state capital. It is about 180 miles east of Pensacola and is probably less than an hour and half drive to the Gulf of Mexico.
State capitals often have lots of legal work lying around.
Melbourne Beach, Satellite Beach, or Cocoa Beach. You could be ON the ocean for a reasonable rent. Not too far from Orlando, if you needed to go that far for a job. Very quiet during the Summer though, if that’s a problem.
How is the Sebring area? I get the impression that anything inland is Hell on Earth in summer.
I’ve never been to Sebring, so I’m not sure. My opinion is that if you’re going to live in Florida, try to be as near the Coast as you can pull off. I love the ocean. Orlando baffles me.
Inland is probably hotter than the shore during the Summer, but it’s really hot, and really humid, everywhere. Actually it’s like that from May through September in South Florida. I like it, but some may not.
Thank you again Palmetto for your help. Like I said, if I get back down there, I will buy you a steak dinner and all the beer you/me can drink!
Greg
I’ll spring for some champagne. I’d also like to welcome walt back to Florida.
A lot of people flame Florida big time. Especially Californians, whooeeee! But that’s OK with me. In fact, I rather like it when people diss Florida. Anything to stop the influx. I like to encourage people who don’t like it here, to move on ASAP instead of sitting around complaining. I like to mention all Florida’s bad points, like heat, humidititty, sinkholes, etc. to speed them on their way.
I like it here, always have. It can be a pain in arse sometimes, but it gets in your blood like dengue fever. Can’t beat the fishing. And it is NEVER boring. Someone’s always doing something boneheaded.
I used to visit Florida every year as a youngster (my grandparents were snowbirds from Canada, the type every Floridian loves so much.)
I really enjoyed riding an oversized three wheeled bike around the trailer park or going to the various tourist traps like Busch Gardens or EPCOT centre. Oh and of course visiting my grandparents.
And don’t forget, another National Championship! GO GATORS!
Most of the people in Fla live in bad places; similarly, a good number of other states. Unfortunately, those “bad places” are where a lot of the higher paying jobs are located. Otherwise, we’d all be there.
A lot of people flame Florida big time. Especially Californians, whooeeee! But that’s OK with me. In fact, I rather like it when people diss Florida.
I think a distinction needs to be made between what Florida became during the boom vs. what it was and what it can be again.
Like the current incarnation of Manhattan (a place I personally like to make fun of on a regular basis), Florida had a lot of soul sucked out of it in the past 10 or 15 years. I hope the eccentric potheads, the boiled peanut-eaters, the beach bums, the sun-bleached wheeler dealers, the masters of the sandwich cubano and other assorted provincial types take over ol’ FLA, ’cause they’re the kind of people that always made the nooks and crannies of the state so interesting and unique. (IMO.)
FL went from boiled peanut eeters to koolade swillers in one fell swoop.
bless you ET-Chicago!
Palmy,
My feelings about California are the same about your feelings concerning Florida. I like here, it can be a pain at times, it is in my blood and it is never boring in this state.
Dear Muggy:
I am sorry!! I would never hurt your feelings. Please accept my apologies.
Greg
No problem, just bustin’ chops.
A sidenote: when you want to reply to someone, you can click the little blue link to the right that says “Reply to this comment.”
By the end of today, this exchange will be too far apart from your original post to make sense.
Just wanted to thank everyone here who helped me get over my emotional block over renewing my lease at a rate that I thought was above the prevailing market rate for comparable apartments. Turns out the meniscus tear is real and large and, because of its location, has zero chance of healing on its own.
Next move is to stop babying the knee to find out what my real situtation is. I’ve been very very cautious with it for the past few weeks so it feels a lot better, but I can’t live my life never exercising at more than a brisk walk and not bending my kee past 90 degrees.
Doc said the knee was otherwise in pristine condition, so if I get the surgery eventually, the results are likely to be outstanding.
Anyway, holding on to my first floor apartment was definitely the right move for this year. The third floor walk up I was considering would not have been a great idea. Thanks again.
Polly, why do you have to wait to have that knee surgerized? It can be done with an arthroscope and the incision shouldn’t be a whopper. The sooner it’s done, the sooner you can start your recovery.
And it’s a heckuva lot nicer to do your recovery time during winter than during the lovely mid-Atlantic spring, when you’ll want to be out and about.
At this time? I want to make sure the surgery is actually necessary. I’m really not in any pain right now (twingy, but not real pain). The bad incident I had after a brief sprint up the escalator in the Metro before Christmas could have been a fluke. I doubt it, but it is possible. I work for the government. If I get totally unneeded medical procedures, the taxpayers of the US pay for it (eventually). It is both responsible and easy enough to wait a bit.
Also, I should clean up the extraneous papers on my floor before I face even a few days when I can’t put any weight on my leg. That’s my inauguration weekend project. Also, I need to go to NYC for my niece’s birthday in about a month, and unless I could have the surgery in the next two weeks, I wouldn’t have time to heal enough to do that easily. And I’m in a rather sensitive time for several projects at work, and I would rather pick my time to be out of commission, even for a few days.
If going back to my normal activity level brings the pain back, I will probably do it towards the end of February. For now, I’ll wait.
Disclaimer: I’m not an orthopod. But even a non-surgeon knows…it is clearly not an ‘unnecessary’ procedure to repair it. It would be shocking if your insurance wouldn’t cover the surgery when you do go ahead with it.
I’m glad it isn’t bothering you too much. Sounds like you have a busy month ahead.
I’m not worried about the insurance covering it. That is the one thing I don’t have to worry about, thank goodness. Oh, and I have plenty of sick leave accrued. More than plenty.
Just another time to be grateful for a good job.
The longer you wait the bigger the opportunity for arthritis to set in.
After a dear friend, who is a physical therapist, explained to me what happens if you wait, I was on the table two weeks later.
Please don’t mess around with this stuff, it can really bite you later on.
I was walking with just a cane the day after the surgery. Skiing 10 months later.
If you just get it done, you won’t have to think about it anymore.
“After a dear friend, who is a physical therapist, explained to me what happens if you wait, I was on the table two weeks later.”
Could you explain a little of what he/she said? I’m only talking about taking a few days to figure out if any of the sharp pain comes back when I use it normally (planning a long day on the Mall and the museums for tomorrow) and then waiting 5 weeks instead of only 2, but I’m willing to be argued into doing it faster if I could confirm that it is a real problem.
For what it is worth, the doc said it was OK to wait a bit if I really wasn’t feeling anything, but we agreed that it would only be a valid assessment if I went back to a normal level of activity.
A problem that might arise is that you now favor the good knee, which in turn will start having problems since it’s now bearing more than its share of the load. My sister had this problem, ending with a knee replacement.
Or a bad back. I put off surgery and ended up with a bad back due to compensating for my bad knee. Its better now, but I should have had the surgery right away. I was down for 2 days and walking OK within a week and playing soccer within 3 months and I am old and fat….
You can find a video of your type of surgery here.
http://www.nlm.nih.gov/medlineplus/surgeryvideos.html
Um…thank you. I’m sure I should look at this, but I’m not certain I can get up the nerve. However, I do appreciate the thought.
I was able to watch the screen the doctor was using for the surgery. Seeing your knee poked at in real time, without feeling it was weird but cool.
Economy sheds 524,000 jobs 8:30am ET…
Employers slashed payrolls by over half a million jobs in December, as the unemployment rate climbed to its highest level in almost 16 years.
This brings the unemployment rate to 7.2% this will be looked at as low in the coming year.
That should bring the I.E. up to about 14%.
Which would probably mean real rate around 20% for the Inland Empire in California and 11 to 12% for the nation as a whole.
For the people who remember my “bear trap” comment yesterday, TOLD YAAAAAAAAAAAAAAA!!!
Futures pointing up at 8:45am.
Yes you did.
Question though - if this was worse than expected (it was per Marketwatch), then why would this make the market go up?
(Other than the obvious being “the market always goes up on bad news” that is)
Perhaps the old “buy on the rumor, sell on the news” (or vice versa in this case)?
Yep, something that the CNBC watchers will never grasp.
The reaction of the “odd-lots” has been discounted.
Well, so much for that.
It’s a trade not a buy-n-hold.
It’s Messiah Fever.
LMAO! Winston is back. ADP could never get it right b/c it doesn’t know what Winston is going to do next. Winston has carte blanche. He can push numbers up or down. He pushes them all around. 525 + 154 = ? Bloomberg:
Payrolls were forecast to drop 525,000 after a previously reported 533,000 decline in November, according to the median estimate of 73 economists surveyed by Bloomberg News. Revisions subtracted 154,000 from payroll figures previously reported for November and October.
Who was is not long ago that told me to wait and see how the day turned out…?
How’s that crow taste FPSS?
CNBC….talking about three million more job losses to come this year. (Note: They have been wrong all along about how bad things are going to get).
The system that the powers to be are trying to prop up is crumbling.
Lets see:
Economy…….phoney
Healthcare……..rigged
Education……..racket
Housing…….. artifical demand
Control……..false belief they had it
Power…..powerless
George Bush, “This sucker is going down”…..he got something right.
A much lower standard of living is washing across the land. Can you live on 20-50 percent less than you make now?
RE: Can you live on 20-50 percent less than you make now?
Every time I go out to some public event, it sure looks like a fook of a lot of people can certainly stand to have their caloric intake taken down 50%.
Fat Fool Nation-”Gimme a Double Cram Down”
Ain’t that the truth.
Very recent studies show that diet is more a factor in weight than exercise and more Americans are now obese compared to those who are merely overweight. Your observations ring true!
RE: The system that the powers to be are trying to prop up is crumbling.
Lets see:
O’Bama Stimulus Plan
$500.00 tax credit…like this an improvement over the $300.00 Bush check which did squat.
Extended unemployment benefits & healthcare…lots of jobs created here.
Direct aid to states…Gotta keep payin’ those $200k per year prison guards, $150k small town beat cops, and billions in unfunded pensions to keep the books square.
Repair roads, bridges, schools…or take care of all the previous deferred maintaince which wasn’t completed with previous collected gas tax revenues because the monies were diverted to the general fund welfare rat-roles.
Double production of alternative energy…like the wind farm opposed by Fat Ted Kennedy who’s yachting grounds were being “impacted”. Complete “Green” propaganda.
Modernize and insulate federal buildings…Puff out the digs for the do-nothin’ “let them eat cake” bureaucratics. Big stimulus here!
Insulate 2 million Section 8 homes…Great program for fraud and abuse by the politically connected. Losta skill involved in layin’ in all those fiberglass batts. Sounds like a Mexican Illegal Worker Relief program to me. Will also let the tenants keep those 3rd floor windows open.
Quicker biz write-offs for depreciation…Will the last biz standing after the Depression please shut out the lights.
Computerized medical records…nice freebie hand out to Big Health Care.
Equip schools community colleges and universities with modern classrooms, labs, libraries…So WTF is all the $40/$50k per year tuition money going?
Expand internet broadbands…Sop to porn industry.
Invest in science, research, technology….Yeah gotta keep all the fatties livin’ till their 100, so all the nursing homes can keep suckin’ off those Medicaid and Medicare tits.
It’s a complete joke.
Insulate 2 million Section 8 homes…Great program for fraud and abuse by the politically connected. Losta skill involved in layin’ in all those fiberglass batts. Sounds like a Mexican Illegal Worker Relief program to me. Will also let the tenants keep those 3rd floor windows open.
They will then complain that the insulation is causing them to have some allergic reaction, or causing more mold to grow (remember the FEMA trailers?) and start collecting Social Security Disability in addition to section 8!
nsulate 2 million Section 8 homes…Great program for fraud “and abuse by the politically connected. Losta skill involved in layin’ in all those fiberglass batts. Sounds like a Mexican Illegal Worker Relief program to me. Will also let the tenants keep those 3rd floor windows open.”
There appears t be a gigantic attempt at creating a bubble scam in green initiatives. This latest scam involves gov’t promising to create millions of jobs in the green sector. Lots of companies getting into this latest scam hoping to get in on that gov’t largese. Some layed off construction contractors with an eye on the main chance might jump on this and advertise themselves as eco-contruction firms, environmental services, ect,
There is an eco- convention Jan 23-23 in LA. I went to one last Sept and saw about a 100 companies advertising the latest green energy construction innovations such as artificial turf, wonder insulation, solar heating, tankless heaters, water saving irrigation systems, ect.
The latest bubble is in green technologies.
At least after a bubble in green technology, we’ll have technology that reduces the consumption of fossil fuels. That is good from a security stand point even if you don’t care about pollution/climate change/peak oil. I would love to see the US not have to buy any liquified dead dinosaurs from anyone in the world ever again. Should have been the first reaction to 9/11 (way better than go shopping), but that cargo ship sailed a while ago.
we’ll have technology that reduces the consumption of fossil fuels.
The last bubble didn’t reap any rewards (did it?) with regard to more efficient house-building technologies or end-product houses. Why should a green bubble be any better? In fact, a bubble may have the opposite effect in creating and propagating things that are less than useful or wasteful of scarce resources in some regard.
The essence of a credit-expansion boom is not overinvestment, but investment in wrong lines, i.e., malinvestment.
Ludwig von Mises
It might be of a shoddier quality than it would have been if it had been developed at a time of economic necessity, but it still won’t be totally useless. I can live with an over allocation on experiments of how to get off fossil fuels. Tech bubble made a total mess of somethings (pets.com? viable? really?) but we got way more tech infrastructure than was justified by the level of usage at the time. But I like that this infrastructure is in place now.
Same for green tech. We may build up solar panels or wind farms way before they are really econmically viable. But one, we will get some experience with the technologies, and two we will send less money to the middle east. Either one or two is a better use of money than leaky oversized houses in areas with no jobs. Would a quick crash to the natural size of the economy without the credit bubble be faster and less painful long term? Yeah, it might be. But we aren’t going to get that. If we are going to spend money on something, lets make it something with some prayer for usefulness.
My real favorite item to spend the money on, if the money has to be spent, is a huge upgrade to the county’s electrical grid. We need more capacity for electric cars when they come and way more redundancy for safety/security’s sake. Way more.
Polly:
This has been my pet peeve for years, We dont need to upgrade the electrical grid if we created 2nd 3rd shift weekend holiday jobs…..the California black-outs would never occur if you had a million more people working at 4 AM instead of 4 PM..
I would love to work overnights, but there are so few places in Manhattan to even apply.
Its nice to take your SO Tuesday Noon to an empty beach in summertime. And parking right on the main strip at Rockaway Beach.
———————————————–
My real favorite item to spend the money on, if the money has to be spent, is a huge upgrade to the county’s electrical grid. We need more capacity for electric cars when they come and way more redundancy for safety/security’s sake. Way more.
“a huge upgrade to the county’s electrical grid”
Unlikely, as long as any small group of local naysayers can tie up a project in court, nearly effectively forever. This will kill off even P.C. energy like wind, solar, and geothermal, much less those eeeeeeeeevil coal and nuke plants.
The Obama administration will have to cave on this, with so much of their support coming from trial lawyers, NIMBY “activists” and save-the-endangered-weeds environmentalists.
Which is why right after 9/11 was the golden moment when you might actually have gotten people to put up and shut up. I don’t know if it will happen, it is just my favorite option of the ones we seem to have on the table.
I don’t think we are going to move to massive amounts of shift work in the US any time soon. Not many people have your attitude NYCdj. Especially those with kids who really need to use the public schools to cover most of their child care.
Which is why right after 9/11 was the golden moment when you might actually have gotten people to put up and shut up. I don’t know if it will happen, it is just my favorite option of the ones we seem to have on the table.
———————-
So true, Polly. Good posts.
Extended unemployment benefits & healthcare… Repair roads, bridges, schools… Modernize and insulate federal buildings… Computerized medical records… Expand internet broadbands…Invest in science, research, technology….
You certainly seem to be fired up about a whole lot of things that most people would view as much-needed or common sense prescriptions. Or maybe you can just see the downside to everything?
What is it you’re for, exactly?
RE: What is it you’re for, exactly?
A private sector manufacturing based economy based on the production of products which contribute to a population’s well being and economic security. Ya know things like steel, paper, leather, electronics, shoes, clothing, et. el.; or the antithesis of the make believe Foo-Foo “nail painting and sub sandwich economy” which exists now.
But if one isn’t fired up by a bunch of Joesph Gobbels inspired propoganda promulgating a bunch of massive debt financed “make work” programs then I guess you’re part of the problem
Well, at least you got the obligatory Nazi reference in.
You think we don’t need healthcare reform. Wait until you have to deal with the current system under duress.
You think repairing infrastructure is a bad idea? Tell it to the Tennesseans who’s town was just swamped by toxic coal effluent, or the Minnesotans killed in the bridge collapse last year, or the entire city of New Orleans.
You think investment in science and technology is a bad idea? You use the fruits of US-government backed science + tech every single day; hell, you’re using it every time you visit the HBB — the DoD made this wonderful series of tubes possible.
Poorly considered, poorly implemented conservatism is out, baby — that’s the faulty brain trust that shipped our manufacturing base overseas and gave us an asinine war, a credit crisis, a housing bubble, and the “make believe Foo-Foo nail painting and sub sandwich economy which exists now.”
Amen, ET!!!!
Where is Dr Kevorkian when we NEED him???
I do not want to live like my grandmother for the last few years of her life. Why can’t I say enough is enough put me to sleep and not have anyone sued or arrested over it?????
She passed away in april at 112 and 11months……
Elizabeth lived for over 989,700 hours.
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Invest in science, research, technology….Yeah gotta keep all the fatties livin’ till their 100, so all the nursing homes can keep suckin’ off those Medicaid and Medicare tits.
I’m with you on this, NYCdj. One of my deepest fears is becoming so incapacitated that I can’t even express my desire to be put out of my misery, let alone being allowed to achieve that desire. We treat our pets better than our beloved family members in this f’ed up country.
Elanor:
We cant torture Charlie Manson, but we can torture our grandparents….
And worse The state of CT wouldn’t pay for a live in home care worker …Yes my grandmother had her own apartment ( parents 2 fam house) till she was 110 but the state of CT would gladly pay well over $100K a yr.to put her in a nursing home.
Agreed… Bush didn’t bail me out last time state govt’s got the squeeze, and I survived. Too many fat salaries in admin. Let these idiots take the hit for their mistakes.
I suppose you mean Medicaid, which is paid for by the states. They could start by just funding more enforcement. That would cut Medicaid costs immediately. What was it, $1B in fraud in Miami alone?
And sue illegals for the cost of their anchor babies’ care.
THIS is why I never want to see another Kennedy in office!
Eat the Kennedys.
Too true. I would get rid of Sec. 8 entirely. The entire program is a fraud machine for LL’s, not to mention a breeding ground for crime, because you don’t have to work when you pay $20/mo. rent. A few public run projects for the elderly, severely disabled, and certain mothers with children with absolutely clean behavior, and no tolerance for shady characters hanging around are all we need. (I have met a very few women who fit this description on public assistance–who most certainly are providing their children a better home than foster care… they are rare, but I would not see them punished.)
Hate to break it to you, but this was already in progress under Bush admin. I like this, because my records are in 50 diff. places and I have to go through h@ll every time I go to a doctor b/c they don’t have my medical history.
Wow, this was already accomplished in the 1990’s… so how much did Micro$oft bribe the DNC this time?
Even the poor countries in Europe put us to shame in terms of access to and quality of high speed internet. The problem in the US is that Congress gave Verizon big bucks to upgrade to fiberoptic in the early 1990’s and the ****-****ers pocketed the money and did nothing. Then they had the chutzpah to stand up to congress less than ten years later asking for the same money again. **** them.
Fire everybody in the FCC, and replace them with a panel of middle-income consumers. Be sure to include bribery controls (cannot accept job in industry, neither can family members, etc). Let them decide if ATT, baby bells, cable co’s, local telcos, ISPs, cell phone providers, muni’s, and satellite svcs can all compete for home phone, cell phone, internet and TV service. I believe the answer is “yes.”
Boy, you woke up on the wrong side of the bed today. We’re losing our technological edge. We need basic science funding. We also need to reduce the H1B program and get more Americans doing this stuff (and less of our technology fleeing to India, Korea, and China). It’s like when Nazi Germany kicked out the Jews. They came to America and made our universities and technology #1 in the world. Now we import science day laborers, and they take our academics and technology back to Asia.
Germany rebuilt their academic institutions and tech edge after fifty years. Will we?
RE: And small town “beat” cops do not make 150K.
They do here in Mazzland which is the only state in the union which mandates the use of police officers to do the work of flagmen on street construction projects at the rate of $43.00 per hour.
$43 x 2000 hours = $86,000. Heck, throw in some overtime, throw in a lot of overtime and you’re still not close.
Once again, something doesn’t add up …
Gotta keep payin’ those $200k per year prison guards, $150k small town beat cops, and billions in unfunded pensions to keep the books square.
I looked into this and not even the much maligned California prison guards make anything close to 200K, not even with lots of OT.
And small town “beat” cops do not make 150K.
That is not to say that these groups aren’t paid well, but not like that. And if you want to see low paid cops, go to the south.
RE: maligned California prison guards make anything close to 200K, not even with lots of OT.
Care to disclose the sums?
The $200k number, which I have heard mentioned many times on talk radio, may reflect the ability of guards to rig floor schedules, vacation time, and sick leave so as to inflate overtime and/or run a completely congruent business.
But there are state policemen and city cops earning over a $250k per year here in Mazzland.
Hate to break it to you, but everything you hear on “talk” radio is a lie. (left, right, sports, home and garden, etc.)
Since I’m putting ~22% of my income into 401(k) and Roth IRA, I AM living on 20% less than I make now.
15% - 401k
30% - portfolio
45% less than I make saved
Too bad I’m ‘throwing all my money away on rent’.
‘Can you live on 20-50 percent less than you make now?’
Yes. I do that right now, and therefore I have that ’savings’ thingie that I like to have.
YOUR the reason the economy tanked!
Damn savers… :p
I didn’t get paid for 3 months of work last year, and I have to pay self employment taxes on another month because the company decided not to withold payroll taxes. Oh well, it could be worse.
Oh wait, it is. This nets at about 1/8 what I lost in the IRA last year. It sucks to be a cowardly saver in this economy!
Worse yet, look at the revisions! Guess our observations are better than high paid govmt numbers.
The US unemployment rate would be 16.5% if were calculated the same way as it was prior to 1964:
http://www.guardian.co.uk/business/feedarticle/8219053/print
So 2.5 million jobs lost over the year, including about 550K in December (warped by seasonal adjustement).
A few key points here:
The Current Employment Survey has a difficult time calling a big move, because it has to use models to estimate jobs gained in new firms. When the hard numbers come in from unemployment insurance tax records, I expect a huge downward revision. So, evidently does BLS — the “rebenchmarked” data usually comes out the first week of March, but it isn’t scheduled until March 19 this year. I guess they expect a lot of work.
Second, the survey takes place early in the month, and in any event I expect most layoff were delayed until after the first of the year. It’s no surprise that the uemployment offices in several states were overwhelmed this week. The big losses may not kick in until the February number, which would capture the January firing.
Third, this is just payroll employment, while a rising share of those working have been “self employed” “freelancers” and “independent contractors.” I’m waiting to see the household data (which captures these workers) to see if the December 2007 to December 2008 employment decline is more or less. Is it less because the fired are calling themselves employed consultants, or more because the first to be fired — all those brokers — worked on commission?
The data isn’t up but the press release is, with Nov to Dec. but not Dec to Dec numbers.
Payroll employment based on asking employers about employees: -524K.
Total employment based on asking people if they were working: -806K.
Every smart company Riffed in the 4th Q. There was no advantage to layoff in Jan. Numbers of total layoffs and weekly unemployment will go down for a few weeks maybe upto 2 months.
Motorola is about to lay off 30k thats the rumor
but they are not smart
No Mass Action filed yet, but Motorola let go 10% of its work force in the 4th Q.
U6 rises to 13.5%
yes, how many employers put off firing in december to not be a christmas spoiler! I bet jan and feb will be over 550k each as more retailers fire and close their doors. this is going to get very ugly and obama can’t stop this train wreck. i only feel sorry for those who did not particapate in the credit bubble and lose their jobs. for those,who are maxed out on home equity ATM, bought a home in 2005, 2006, maxed out on credit cards, maxed out on car loans and lose their job….too bad! they should have saved some for a rainy day and that day is coming. of course they will have to do unemployment benefits to 2-3 years before this is over and those same suckers can collect their benefit and live with their parents!! I won’t because i have enough saved to last 5 years without living with family members or working, but would rent a room if i had to to save my nest egg!
Why on earth are the talking heads on Bloomberg saying that the lay offs are going to end in the middle of 2009? They aren’t predicting the recession to end before then and job cuts lag the end of a recession. Usually by a lot, don’t they? Even if you are willing to agree the recession will end in the second half of 2009, wouldn’t it be more likely that the lay offs won’t end until mid to late 2010 (12 to18 months later)?
i think you are probably correct that all of 2009 will be massive job losses and beginning of 2010, by then all the gov’t spending should create some jobs to offset the losses. it will be painfully slow to create jobs. assuming a recession and not a depression??
Brown Should Buy Britons’ Homes, Ex-BOE Officials Say…
Jan. 9 (Bloomberg) — Prime Minister Gordon Brown should buy homes on the verge of repossession to add money to the British economy and save families from being thrown out onto the street, two former Bank of England economists said.
The plan would cost about 50 billion pounds ($76 billion) over five years, Fathom Financial Consulting economists Shamik Dhar and Danny Gabay said in a report today. The program would also provide a new economic policy tool as the central bank’s interest rate approaches zero.
The Bank of England yesterday cut its benchmark rate to 1.5 percent, the lowest since the bank was founded in 1694, bringing it closer to the limits of conventional monetary policy. U.K. officials are considering other measures such as buying assets to pump money into the economy as the recession deepens and threatens to exacerbate the housing-market slump.
“The smart asset to buy would be housing directly,” Gabay said in an interview. “The ideal thing is to go at the core of the problem. This would bring forward the necessary correction. It would to a great extent put a bottom to it.”
The government would finance the program by selling bonds, which the Bank of England could buy up to expand the supply of money, Fathom said. The proposals are a more direct intervention in the housing market than measures planned by the U.S. Federal Reserve, which this week started buying up securities backed by mortgages after bringing the interest rate close to zero.
‘Social Landlord’
Brown’s government would become a “social landlord,” charging rent to families and saving them from eviction, Fathom said. The plan would also allow banks to benefit through the removal of outstanding bad debts as financial institutions worldwide nurse more than $1 trillion in losses and writedowns from the credit crisis.
The ruling Labour Party’s surge of support from Brown’s handling of the economic crisis has started to wane. It narrowed the opposition Conservatives’ lead to as little as 1 percentage point in November from a gap of 28 points in September. Labour trailed by 5 points in the most recent poll of voters by ComRes Ltd. published on Dec. 22.
Of all the d*mbass ideas, these economists take the cake.
I hasten to add that if this happens, every Briton will stop paying their loans, and have the government “pay” for their house.
Do these economists not “think” for twenty seconds before they flap their gums?
Maybe that’s the whole idea FP. It’s an easy way to introduce communism-style housing without an actual bloody revolution.
Right - “social landlord” as in USSR “social landlord”
Welcome to the Farm. We’re building windmills, didn’t you know?
Clearly, you misunderstand the role of economists. Their contributions are largely geared towards political necessities. It’s more important for Brown and labour to stay in charge than let free-markets work. These Squealers will say or do whatever is necessary to keep the proles in line and peace on the farm.
But don’t many Britons ALREADY live in “council housing?” Or am I misunderstanding this.
” The Taypayers buy a house and RENT it from the State”
What a novel idea…perhaps it will DAWN on the American Gov’t, local tax collectors and Wall Street soon as soon as they figure out how to bring back mules and cotton sharecropping
What if you forced mortgage lenders to hold title to the house until the mortgage was paid off? (They don’t wish to because they want the homeloaner to hold all the liability, but this could be mandated by law.) Now THAT would certainly drum in the notion that you’re renting from the bank!
road to serfdom, the 30-year mortgage
Didn’t see this posted the other day, so hope it’s not a dup.
SAN FRANCISCO (MarketWatch) — PennyMac, a firm backed by BlackRock Inc. and Highfields Capital, said Wednesday that it bought more than $500 million of mortgages from the Federal Deposit Insurance Corp. in a deal under which both parties would share in gains and losses.
http://www.marketwatch.com/news/story/story.aspx?guid=%7BF10E6ED8%2DD0B1%2D40EA%2D9E82%2DD78B97689C54%7D&siteid=rss
I can’t get the link through, but google Indymac Sorros. Seems like a developing trend with investors partnering with FDIC/Gov and striking lucrative deals.
This is a repost from a few days ago. It’s for the NYC crowd, and a fine and dandy example of NYC being the same as everywhere else. It’s especially good for some of you Ivory Tower / smartest guys in the room-haters.
Top law firm signs lease at height of market. $100sq.ft.
bloomberg.com/apps/news?pid=newsarchive&sid=aar21pxL.2ow
Prevailing rates now $60sq.ft.
Also, property now bank-owned
Cravath’s lease is $900M, my inside source says the building is worth about $600M - fair warning: my inside source has a law degree from the top research university, so he is usually wrong. Don’t worry, I tell him all the time he is the dumbest smart guy I know.
Cravath is filled with the worst of the worst preppy j@ckasses.
BWAHAHAHAHHAHAHAHHAHAHAHHAHAHHHHHHHHHHH!!!!
Cravath screwed all NYC associates out of about 60% of bonus from last year. I hope their rent alone will bankrupt the firm.
NJ, are you serious?
Yeah, my buddy’s bonus is only $17k. He’ll have to skip Hermes this week.
Waa.
OMG, take a moment to read that article, here are some whoppers:
- Clearly, they bought the asset at a low yield, anticipating that because of the strength of the rental market, that yield will be improving as they renew leases.
- Cravath pays about $39 a square foot under its current lease, which began in 1989
- Vacancies in midtown have fallen to about 4.3 percent, and options for tenants needing more than 500,000 contiguous square feet in an existing building have dwindled.
- There’s only one block of space in midtown large enough to accommodate Cravath
———
Dear Cravath, would it kill you to have some employees across two buildings?
And macklow had to give back his buildings so he didnt have to file bankruptcy…right?
Will cravath ask for a rent reduction or will they force the peon lawyuhz to work more billable hours for no increase in pay?
Here’s some info on that:
reuters.com/article/businessNews/idUSHO16643420080201
Poor Macklowe, another
victimpants-downer of thecredit crunch“it’s different here” orgy.They can fix the space issue by laying off whole departments (real estate, corporate finance). Then the profitable departments (Bankruptcy) will spin off into their own firm…..
Actually, Cravath’s traditional method of getting through a downturn is to just tell all the summer associates/law students that they are not making any partners and do not plan to make any partners in the forseeable future. They loose the top grade getters/law review people for a few years, but the ones who do go can’t say they didn’t know what they were in for.
Actually, one of my very mediocre classmates became a partner after taking a job there in just such a climate, because things had improved 8 to 10 years later. I’m sure she picked up sufficient skills once she was working, but to hear her blather on about which professors she thought would be OK to sleep with while she was in law school was nothing short of disgusting. Wonder if she ever did any of them?
Pictures please Polly.
Sorry, Skip. Too close to id’ing someone by name already. You’ll just have to dream…..
Polly, It wasn’t Cravath, but in the day I had one of those $1,500 a week summer internships with trips to Yankee Games and interview stays at the Waldorf. I (foolishly) passed to live elsewhere as my (would be) wife was a country girl and not going near NYC. Still not making as much as I would have out of law school but I do leave the office everyday by 4 or 430 and never work on weekends….
I did it for about 5 years. Paid off my student loans in 3. It was worth it, but not if you had a real person in your life who couldn’t handle NYC. You did the right thing.
Cravath’s last location was the best deal any law firm ever got in NYC, as far as I know. The building was in a bad neighborhood when they moved there - Clinton, otherwise known as Hell’s Kitchen. And it wasn’t right on the edge, it was in it. They figured it was near mid-town so they wouldn’t have trouble getting car services to do pick ups in the evening, it wasn’t really dangerous in broad daylight, and no one was going to be leaving in the evenings before the car service ride home policy kicked in anyway, so why worry? They got amazing space, very near subway, room for day care center, you name it. And the nabe did improve around them eventually - though I missed the $3 movie theater (regular movies, but right after they were out of the chain theaters) when it finally lost its space.
I guess they thought that one brilliant accident meant that they could do it again. Good luck next time, guys.
Let me repost this and see what you think…I worked with Dan Abrams at Court tv during OJ….A pretty wishy washy and useless survey to me.
DON’T ALL START LAUGHING…..just call dan at 347-882-8227
——————————————-
Survey: Reporters dropped ball covering meltdown
Jan 8 04:52 PM US/Eastern
By DAVID BAUDER
NEW YORK (AP) - Signaling a look inward that echoes critiques of the media’s performance in the months before the Iraq War, some of the nation’s top financial journalists believe reporters dropped the ball as the nation’s economy tumbled toward crisis mode.
Sixty-two of 100 journalists surveyed by Abrams Research, a firm started by former MSNBC chief Dan Abrams, criticized the media’s work, suggesting there was an over-exuberance about the economy and a failure to connect the dots as troubles began.
“That’s a very telling and interesting number,” Abrams said Thursday. “Some of the comments we got were really fascinating. I think there’s a lot of self-examination going on within the financial media about what happened and why.”
The journalists questioned over the past few weeks, mostly reporters from organizations such as CNBC, The Wall Street Journal, The New York Times and others, were promised their identities would be kept confidential in return for their opinions.
They split almost evenly on who deserved the most blame for the crisis: 45 said banks and 44 said regulators. Only two believed that the media was mostly to blame, and nine pointed their fingers at consumers.
Said one journalist: “Everyone dropped the ball. But the media does not have nearly as much blood on its hands as the financial industry and government.”
Another reporter said that, just like in the dot-com era, basic rules of gravity were ignored. What goes up, must come down.
“I blame myself in part,” one reporter said. “I wrote about many of the components of the bust, including the opacity of derivatives (where does the risk go?), the extremely low interest rates that fueled housing, and declining lending standards. But I failed to put it all together and see how really, really bad things would get.”
Yet there was a substantial minority that resisted blame being placed on the media.
“The media, like real life, is full of a diversity of opinions and stories,” a journalist wrote. “The warning signs were there, and stories were written about the looming dangers. I find it offensive that there’s a notion that the entire business press can be criticized for a failure to see the future once we’re in a troubled climate.”
The survey found that 42 of the journalists believe at least three Fortune 1000 executives will be indicted during the coming year for their roles in the financial crisis. Abrams said he was surprised that the number was so high; 27 of the journalists believed there would be no indictments.
“Unfortunately, stupidity and venality aren’t criminal offenses,” one journalist wrote.
Only 30 of the journalists said they thought the current situation will come to be known as a depression. Thirty-one of the journalists said the recession would end by the beginning of next year; most believed it would stretch longer.
Anyone who trusts the corporate-controlled mainstream media for real truth and real news is delusional. That’s why people who seek those things are canceling their subscriptions and turning to blogs instead.
What a bunch of jackholes.
I found this blog back in 2005 or thereabouts, where I found out that I was not the only person who couldn’t figure out how a $14,000 a year strawberry picker could get a $800,000 mortgage.
Several of the wiser financial heads on this blog explained where all this money was coming from (along with a Peter Thiel interview in Barron’s in 2004), and the consequences if this Ponzi scheme blew up. Their predictions so far have been about 95% accurate.
If I can figure things out, being a non-financially oriented person in one of the remotest locations of flyover country, what was their problem? They were getting PAID to do this full time, supposedly.
News reporters are lazy. It takes a lot of legwork to actually investigate a story and get to the truth. It’s a lot easier job if all you do is regurgitate press releases.
‘If I can figure things out, being a non-financially oriented person in one of the remotest locations of flyover country, what was their problem?’
Ditto! Except for the flyover country part, ’cause I’m in the PNW. But yeah, if IIIIIII could see something was seriously wrong then certainly ANY financial reporter with a calculator shoulda been able to figure it out.
Oh, and btw gulfy, what are the 5% of predictions you estimate didn’t come to pass, here on the HBB?
Pretty much everything predicted by our resident gold bug, Ali-whats-his-name……….:)
At least so far.
I’ve noticed that, since the predictions of 2-3 years ago have mostly come to pass, there is major disagreement on what is going to happen 2-3 years from now.
The big-time reporters (ie, teleprompter-readers) were making money off the scam. Small-time reporters were getting paid by newspaper advertising from builders/realtors.
They were paid not to report it. This is not limited to the real estate bubble.
” Pretty much everything predicted by our resident gold bug, Ali-whats-his-name “………
Aladinsane, was his name, and since he was run out of town, or anyone who discusses gold, I haven’t had much interest in reading here anymore.
…..but to your point, the housing bubble went on 2 years longer than I thought. Regardless, as most don’t want to hear it, but sleep soundly knowing I am not in the current paper ponzi scheme.
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4177766/Merrill-Lynch-says-rich-turning-to-gold-bars-for-safety.html
Inflation or deflation?
http://tinyurl.com/9thnek
“Arizona food prices dropped sharply in the fourth quarter as falling commodity prices and increased competition finally smiled on consumers.”
“The $2.71, or 5 percent, fourth quarter drop was one of the most dramatic ever recorded by the Arizona Farm Bureau”
There is still a glut of goods in the pipeline, but what happens when supply is reduced to match reduced demand? I see an age of scarcity and diminished choices coming.
“There is still a glut of goods in the pipeline, but what happens when supply is reduced to match reduced demand? I see an age of scarcity and diminished choices coming.”
yes especially when the Government controls everything
“but what happens when supply is reduced to match reduced demand? I see an age of scarcity and diminished choices coming.”
This is the Kunstler/Alad/Whiplash crowd prediction. I would not like this, but can imagine it.
A stab-for-rice man I shall become.
I don’t know if this has been brought up here yet, but I just got the answer to a question I’ve had for a while. Since Fannie/Freddie were taken over by the government, they pay no property taxes on their foreclosures.
Wow - didn’t know that. That’s an interesting distinction between a “government-sposored entity” vs. a “government entity”.
That could put an even larger dent in the budget problems most municipalities are already having.
Got a link perhaps to where you go the info?
Actually, I got it from searching local property records. Go to your local database and put in “federal” for the owner’s name. You should see properties where the tax amount is “0″.
That means cheaper carrying cost.
Great. Now they can stretch it out even farther.
Cyn-Grl,
Great find. That would never have even crossed my mind. Just when you think it can’t get any crazier….
Are you sure about that, the back taxes, just while they hold it, or are you talking about the Deed/transfer tax many states charge that gov’ts are usually exempt from?
I can’t tell. All I know is that the current record shows that the tax amount is “0″. The public database that I have access to does not show payment record, back taxes etc. It just shows the basic property information, including the current assessment and the 2009 tax amount. But that *is* a good question.
I’m pretty sure they were except from state and local taxes prior to the conservatorship.
Playing with the numbers:
524,000 new job losses for December
If only half of those are couples not single households, 262,000
Then at least 786,000 people have had their spending impacted.
The impact will always go deeper than the numbers.
******
Very interesting. Using your assumption and adding in the 154K revisions on the previous two months and you get another 231K for a total of over a million adults impacted.
Don’t forget all the small business owners whose income has dropped–and their idiot children who aren’t getting cash payments from mommy and daddy.
Yes, some small businesses are prospering, but many have seen a major slowdown which accelerated as fall turned into winter.
Add a few million who are reduced to part time, so are not “unemplyed”.
And don’t forget the children!
From the East Hampton Star:
A blog that makes harsh accusations against real estate professionals on the East End has ruffled quite a few feathers over the
past few months, and its author has no intentions of backing down.
George Simpson, the publisher of east endlistings.com and owner of the Southampton-based Suffolk Research Services data tracking company, has called for the imprisonment of real estate executives and agents, saying they have knowingly violated antitrust laws for years.
In an inflammatory blog that asks readers to “cast your vote for the most jail-deserving real estate agency owner/president,” Mr. Simpson has embarked on a crusade against RealNet Solutions and the agencies that subscribe to Open RealNet Exchange, or OREX, a Web-based service that Mr. Simpson said he can prove is an illegal monopoly.
“This is hurting our economy out here, it’s a stain upon the Hamptons,” he said. “It’s a terrible thing to have the biggest industry in the Hamptons run by a bunch of crooks.”
http://www.easthamptonstar.com/dnn/BusinessRealEstate/Blog/tabid/7546/Default.aspx
Here’s a local version:
“This is hurting our economy out here, it’s a stain upon Marin County,” he said. “It’s a terrible thing to have the biggest industry in Marin run by a bunch of crooks.”
The eastern end of Long Island is coming apart. After you lose your job, you sell your toys. And even if you keep your job, if you lose your bonus, you sell your toys. The only problem is everyone else is elling theirs too.
Hard to shed a tear for these folks.
“…For the people who remember my “bear trap” comment yesterday, TOLD YAAAAAAAAAAAAAAA!!!”
Well that was a good call…however, Mr. Bear posted about an earthquake in Californian…and Sha-Zam…a 4.5 in San Berdo…maybe it was a sing to tear down & reconstruct the Inland Empire?
Mr. Bear = 1
FPSS = 1/2
SPX down 18 to 891. Closed 909. Will it hold at 888? Testing.
” that was a good call…however, Mr. Bear posted about an earthquake in Californian…and Sha-Zam…a 4.5 in San Berdo…maybe it was a sing to tear down & reconstruct the Inland”
a major quake in San berdoo- 4,5 is rather small- would actually improve much of ravaged San berdoo. It would provide cover for Fbers to torch their underwater IE shacks and then scam the fed out of billoins in emergency funds to rebuild.
Ever been thru inner berdoo? No major quake could scar the IE landscape as much as the ravaging and pillaging done by greedy Homebuilders & fly by night corps who simply layed waste the IE and scarred the IE landscale for an entire generation. Lots of severe ecological pillaging by the HB’ers which could create make- work gov ‘t ‘green job’s in cleaning up & restoring the polluted IE environment.
Most of the work would be outsourced to the abundant illegal alien population in San Berdoo.
Dow breaks support. Is it temporary?
While I have no idea how this is usually interpreted, it’s interesting to note that the 10th Amendment to our constitution says:
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
Does this mean that States can’t pass laws forestalling foreclosure? Or forcing banks to cut deals.
Of course, I don’t know if the Federal government is limited.
I don’t think I’d ever stand a snowball’s chance in hell with this argument, but I was extremely pissed when then Governor Jeb Bush passed a law invalidating sections of CC&Rs (that people agreed to with their signature) that prohibited flying the American Flag, clothes lines, and Solar Panels. My thinking was if people were foolish enough to move into a community that limited these things, that’s their problem. And if I was wise enough to seek out land that didn’t have these restrictions, I should be allowed to keep the value added by having unencumbered land. Was not Florida’s law impairing the obligation of a contract?
That’s why Schummer and his merry band of idiots is busy changing all the federal laws. He was on CNBC admitting it was the only constitutional way to do it.
“Was not Florida’s law impairing the obligation of a contract?”
It would seem that way. However it may be that the contract was in violation of some other existing guaranteed right (e.g. a law of US-wide scope, or even Florida-wide scope) that allows anyone to fly the American flag), thus some portion of the contracts were deemed unlawful and therefore invalid.
If however a law guaranteeing the right to fly flags didn’t exist, and was added later, then that would seem to violate the 10th amendment.
I was planning to take a 4-year mid-life retirement during the Barack Obama Era (esp. if he uncaps Social Security. I’d be damned before I’d pay 64 cents in taxes for ever additional dollar earned)
So if I have time on my hands maybe I’ll take up this cause and make people live up to the terms of the CC&Rs they contractually agreed to.
Its been going on for a long time.
A few years ago, it was common for house deeds to prevent the sale of properties to certain ethnic groups. GWB’s new house in Dallas has deed restrictions like this. Laws in the 60’s invalidated these deed restrictions.
Yes, but those were federal laws!
No State shall … pass any … Law impairing the Obligation of Contracts,…
“Of course, I don’t know if the Federal government is limited.”
The wording of that section of the Constitution suggests the founding fathers viewed the role of the Federal government as limiting the powers of states to interfere with private contracts, rather than legitimizing top-down interference with private contracts by the Federal government itself. The role of the Federal government appears to have evolved considerably since 1789.
…the 10th Amendment to our constitution says:
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
———————————-
That’s actually Article I, Section Ten, not the Tenth Amendment.
Listening to NPR right now. Manhattan commercial real estate is toast. Cochoran rep is the usual BS, which the host (Brian Lope?) called her on, sort of.
Some realtors are A$$HOLES that are completely blinded by money. There’s is Austin, TX Real Estate Market that I also visit. Theres is a new discussion topic about the outlook for the 2009 market in Austin. I posted the following comment:
“I do not understand some of those investors. I monitor some of the condos for rent in 78701, and I am amazed to see how many new condos are for rent… Most of the units have been sitting there fore weeks and weeks; investors seem to be stuck with the asking price even though it is obvious there are not many people wanting to lease $1500+ 1br units with just 700 sq ft.”
Some other realtor read it, and accordin to him, only RE agents are smart enough to discuss the current state of the market:
“BRETT: You’re obviously not a realtor, please don’t make comments about lack of demand downtown, since they’re false. There were 110 leased condos since september, many at 360, and many for over $1500. Now is just a slow time of year for rentals, and AMLI recently cut prices.”
http://crosslandteam.com/blog/2009/01/07/austin-real-estate-market-outlook-for-2009/#comments
Brett, this same poster also said: “That’s why crappy neighborhoods always have the best cash flow…the tennants can’t afford to buy because they live paycheck to paycheck, so sales prices are not inflated.”
Consider the source; An excellent way to go broke is to bet that those who live from paycheck to paycheck during a major economic downturn will keep up with their financial commitments.
“BRETT: You’re obviously not a realtor
Well, that is actually a good thing. You get to watch many of them flame out.
Texas has been one of the last remaining markets to start on the crash and burn wave.
He just paid you the greatest compliment in the world and you chose to focus on the negatives.
This morning, one of the CNBC guys was doing a report on the three or four high-profile suicides by finance types. He definitely suggested that these suicides may indicate a bottom in the economic cycle. These people are shameless.
At least it’s a bottom for them.
So it’s not just cats that bounce?
(Sorry! :D)
RE: one of the CNBC guys was doing a report on the three or four high-profile suicides by finance types. He definitely suggested that these suicides may indicate a bottom in the economic cycle. These people are shameless.
Amazing how these idiots get their jobs.
Simple logic says they represent just the beginning.
Wait until there ain’t no ‘mo monies in the Medicaid bin.
If you are an employer, do as I do and don’t hire any former real estate agents, mortgage brokers, etc. And do a credit check to see if they defaulted on a mortgage. All are legal criteria for determining employment. (I was looking for a p/t event photographer and got two resumes from people who were in Real Estate!)
This isn’t likely to happen, but it would be nice if large companies compiling lay-off lists would check county records and identify those who have foreclosed on a home, esp. a second home. There was nothing more annoying the past few years than all that water-cooler talk about making money “dabbling in real estate”. Morale at most companies would improve is these folks whose real-estate dreams failed were shown the door.
If the Government can’t keep this contained (and obviously that’s impossible now), maybe Business can at least try.
If you are an employer, do as I do and don’t hire any former real estate agents, mortgage brokers, etc…There was nothing more annoying the past few years than all that water-cooler talk about making money “dabbling in real estate”.
That seems quite spiteful, reuven.
And I like it.
You’re right about stopping ‘em before they walk in the door, reuven. (I mean, who needs to be employing known liars?)
But I’m not sure about your layoff plan. The immediate boss will probably try to protect FBs first, being moved by their sob stories (wife’s sick, kid’s sick, husband’s on disability, barely making ends meet).
Also, in many companies, aren’t debt serfs considered “good employees”? >:-D
“Also, in many companies, aren’t debt serfs considered “good employees”?”
My former boss loved sales guys who just bought an expensive new car or house or had a bunch o’ kids.
Lets see, when I worked for him in 2003 I drove a 1998 Jeep and I was single. Luckily he got fired before he got around to determining that I “just wasn’t motivated enough.”
‘My former boss loved sales guys who just bought an expensive new car or house or had a bunch o’ kids.’
Ahhhh, yes. The Utarr work-model, as it were. I know that one. I didn’t do too good at that, either. For one thing, I’m a girl, and also uppity–I mean, I even wore shoes and read stuff! Whenever I wanted! I also didn’t cast my eyes down modestly.
*shakes fluffy Olyhead in recollection of my utterly unacceptable recalcitrance *
And that’s why I’m not Utarrgal.
When I worked for that big company that makes the soft toilet paper, they called it the “point system”.
You got a point for:
a mortgage
stay at home spouse
each kid
Guys with lots of points were sure to endure the abuse-o-meter.
Polly thought you would enjoy this one.
Merrill disassociates itself from Satyam
By Sundeep Tucker in Hong Kong
Published: January 8 2009
Though the spotlight has fallen on PwC and Satyam’s non-executive directors, shocked investors are also expected to question the role played by Merrill Lynch, the company’s principal banking adviser.
The US bank has advised Satyam for close to a decade, during which time it has assisted with the company’s US listing, follow-on share sales and rights issues. Last month, the company hired Merrill to help explore strategic opportunities.
Merrill is now trying to disassociate itself from Satyam as fast as it can. Within hours of the announcement of the fraud, Merrill resigned its latest mandate citing “material accounting irregularities” for its decision….”
ft
I would wager that BankAmerica would not buy Merrill today with what has since happened. lol
More lay offs, I’d venture. God, it is getting ugly.
“…I would wager that BankAmerica would not buy Merrill today with what has since happened. lol”
Has Bank of Opportunity become the In-Sink.Erator for the FED?
Countrywide / Merrill
Satyam will be bought as they have way too many goodie contracts to let flounder.
Another outrageous thing I just confirmed from my tax guy!
All those folks who defaulted on their mortgages can deduct their mortgage interest! Folks who bought condos to flip with i/o mortgages and listed themselves as the primary resident (and most did!) will be able to deduct their interest!
This would be like having a margin account at a broker that you didn’t have to pay back if you lost money and got to deduct the interest.
Before George W. Bush passed the law that excused income tax on forgiven debt this may not have happened if the forgiven debt amount (which is really income), caused AMT or the $150K deduction phaseout to kick in. Plus they’d be paying the income they owed on the forgiven debt.
The Mortgage Debt Relief Act of 2007 (google it!) was basically a one trillion dollar tax cut (add up all the defaults plus deductible mortgage interest). Bush signed it into law, so when Barack Obama says that Bush never cut taxes for the middle class, he’s lying.
are you “middle class” if you have no visible means of support?
I expect that you can deduct interest that you paid, not interest you are charged.
There is a subtle difference here that most FB’s are ill equipped to understand.
High & Low Finance
Easy Loans Financed Dividends
By FLOYD NORRIS
Published: January 8, 2009
“Dividends don’t lie.”
“…In the late bull market, dividend payments provided one of the seemingly strongest arguments for the bulls. Maybe earnings numbers could be manipulated, but dividend payments required cash. If the company had the cash to hand out, you could be confident the earnings were real.
It was a lie.
It is now becoming clear that the great news on the dividend front from 2004 through 2006 was not an indication of solid corporate performance; it was just another sign of lax lending standards. Lenders who willingly handed out money to homeowners with bad credit were even more generous to corporate borrowers….”
NYT
We bash Jim Cramer a lot on these boards, but one lesson he got right was telling his audience to investigate the source of the funds used to pay the dividend. If the company was borrowing money to pay dividends, sell the stock.
Local story here. This is interesting. Here’s a restaurant that served crappy mexican food at exorbitant (for a mexican restaurant anyway) prices. Competition opens up 100 yards down the road and cleans up. So what does the owner of the original restaurant do - he tries to get someone to burn down his restaurant (classic). Read below:
http://www.weatherforddemocrat.com/local/local_story_008112117.html
Typical money grubbing business.
And, apparently, not very good grub either …
that’s for sure. Their nacho plate involved 6 individually placed nacho chips spaced one inch apart with a small amount of beans, cheese and guacamole on top. All for the great price of $9.95. And it tasted like store bought tortilla chips. No thanks - his business was definitely down - very few cars in the parking lot since Antonio’s opened up down the road. Me and my wife would always comment on that. Now Antonio’s - they have some yummy taquitos.
‘Their nacho plate involved 6 individually placed nacho chips spaced one inch apart with a small amount of beans, cheese and guacamole on top. All for the great price of $9.95. And it tasted like store bought tortilla chips.
WHAT!? Abomination! *grumbles heatedly *
I’m just sorry he burned it down hisself. If he’d a waited, I’d a done it FOR him! And I, not being a idjit, wouldn’t a got caught, I bet. Send all the nasty nachos right to Food He*ll, as is only right and proper.
What an idiot. You’re supposed to schmooze a law maker and get them to pass a law specifically targeting your competitor.
Which is something I take great joy in pointing out whenever I hear anyone complain about all the oh so onerous laws and regulations in business. “Hey, guess what, your competitors lobbied for most of those laws.”My other favorite thing to tell them is, “Quit screwing your customers over and they will stop complaining.”
Blago impeached, Excreter mourns.
” But he was a DEMOCRAT!”, she cried.
Countless millions gasp in horror as pay-for-play
Senate seat snares big-hair Chi-town politico.
A true story.
Details at 11.
I’m living rent free…. still.
WHat?! Exeter, you’re a GIRL?!
Jeebus, yet another HBBer I must yank the blanket of mild infatuation away from thanks to them turning out to be the wrong gender. *grumbles heatedly *
Or, and I just thought of this, maybe I should not be so restrictive in my gender preferences. After all, not that there’s anything wrong with that.
*assumes thoughtful face *
Hey, I know…
Exeter! Marry me!
“…maybe I should not be so restrictive in my gender preferences.”
Taoist poet wandering/singing:
Born free…as free as the wind blows, as free as the grass grows…
“I’m living rent free…. still.”
Mom still has not kicked you out, eh?
that Blagojevich expanded a health care program without proper authority, that he circumvented hiring laws to give jobs to political allies, that he spent millions of dollars on foreign flu vaccine that he knew wasn’t needed and couldn’t be brought into the country.
I never knew how hardcore that guy really was.
Interesting that there is enough to impeach, but not enough to indict.
http://newsblogs.chicagotribune.com/clout_st/2009/01/live-blog-of-il.html
“The actions of the House–approving an article of impeachment maintaining Blagojevich had committed abuses of power–represents the equivalent of an indictment.”
“Next week, when the Senate convenes, it will begin the process of setting up a trial of the governor in which each of the 59 state senators act as judge and jurors.”
…so the only question is: will there be jail time?
The end result of impeachment is merely removing from office.
Blago has not been indicted on any criminal or civil charges at all.
I imagine it will be pretty hard to obtain a conviction in court after Blago has had all of Fitzpatricks evidence revealed to him in the Illinois Senate. The media circus will be spectacular!
About freaking time too. I can’t believe this guy had access to his office after TSHTF. I suppose they had already enough on the guy that it wouldn’t matter if he took a couple of weeks to destoy whatever evidence got left behind in his office.
One and only one vote in Blago’s favor… guess that “representative” isn’t planning to run for re-election!
Is the question of whether Burris bought his Senate seat considered out of bounds?
No, it’s not out of bounds — there is no evidence Burris did buy his way in, but he stuck his finger in a lot of eyes by going about things the way he did.
It’ll be interesting to see if Fitzgerald has hard evidence on any
potential seat-buyers, however. There’s a lot more dirt that hasn’t seen the light o’ day.
“…there is no evidence Burris did buy his way in,…”
My understanding was that a wire tap caught Blagula trying to sell the Senate seat, but perhaps I misinterpreted the story…
The wiretap was revealed well before the Burris appointment.
Is there a cloud over Burris because of Blago?
— Yes, certainly. Burris shouldn’t have accepted the appointment. Nobody should’ve accepted the appointment.
Has Burris been implicated or even suspected in any wrongdoing?
— No.
Two separate issues.
It was an impolitic move on Burris’ part, but it does not ipso facto make him a pay-to-play Senator.
“It was an impolitic move on Burris’ part, but it does not ipso facto make him a pay-to-play Senator.”
I concur, but the fact that the Senate seat was so recently up for sale should certainly raise questions about what qualified Burris in Count Blagula’s eyes.
Find out who picked up the tab on his mausoleum…
Burris: widely described as “nice, but a raging egomaniac. I like him.”
This is one for the history books…
BULLETIN
ILLINOIS COURT RULES BURRIS’ SENATE APPOINTMENT IS VALID: REPORT
Ill. court rules Burris Senate appointment valid: report
By Sue Chang
Last update: 2:31 p.m. EST Jan. 9, 2009
SAN FRANCISCO (MarketWatch) — The Illinois Supreme Court ruled that Roland Burris’ appointment to the U.S. Senate is valid and that Secretary of State Jesse White doesn’t need to validate the appointment, the Associated Press reported Friday.
You can’t say I’m not doing my bit for the “economy”.
I just bought two DVD’s at a going-out-of-business sale. The classic Wuthering Heights (out of print, why?) and Mizoguchi’s The 47 Ronin. All for the princely sum of $4 each (including shipping.)
I’m doing a whole lotta stimulatin’, baby!
Ah, the memories… *starts to sing ‘Memories’ loudly and off-key *
… I haven’t seen the Wuthering Heights DVD you’re on about, Fasty, but I recall reading the book when I was going through that stupid formative phase, you know, 11 year old girl who loves unicorns and spends all afternoon looking in the mirror to see how the b00bs are coming along…and I became infatuated with Heathcliff. So dramatic, that delightfully unrequited love…ahhhh. *nostalgic sigh *
I didn’t yet know that moody bi-polar vindictive assh*les are:
1.) A dime a dozen, and 2.) Probably best left strictly alone.
That knowledge came later. Like, when I was 12. And also I was forcefully reminded of it again just last week.
Hahahahaha!
EIGHT DOLLARS!!! Why would you waste that kind of money on DVDs when you could snap up a house in Detroit for the same amount?
Eight houses, man. Deflation.
“Why would you waste that kind of money on DVDs when you could snap up a house in Detroit for the same amount?”
Because nobody tries to burn your DVDs down on October 30th.
Hahaha! Good answer.
Har! Coffee up the nose on that one!
Don’t blame me. I’m still a consumer.
Actually, in all seriousness, I have dilemma that I could use some HBB input on.
I work from home now, and talked to my daycare lady about keeping my littleman at home. I haven’t given too many details, but I have had a lot of child care issues related to the bubble.
1. We were in a private nanny-share until the other family started struggling with, drumroll, mortgage payments. We decided to bail.
2. We found a private daycare, then before we could switch, phone disconnected (I’m guessing bust-related)
3. Then we were left with only one choice - which has turned out to be a blessing - a normal center. They have been AWESOME, but we’ve watched as numbers have dwindled, playmates have disappeared, lastly a room just closed. When I told the director we were giving 2 weeks notice, she said she was hopeful we could work something out.
I know if we pull him out, they will probably cut 1 staff. I think I am going to offer PT, which a lot of centers don’t do because of staffing problems. Anyways, I;ve never been in this position, but I would really for one of these ladies to be laid off, but DAMN, daycare is crazy expensive.
I posted here recently about my DD’s preschool. When I first enquired last spring, they had only one day a week open. A month later I called back and they had two days, so I enrolled her. Fast forward to today… its been many, many weeks since I’ve seen more than 12 in her class (which can accomodate 20 kids). No more wait lists.
Yeah, in the past it was either FT or nothing. My wife and I think they’ll do part time. and we’re o.k. with that, even though it will still cost us $500/mo.
Our littleman already has awesome social skills, and I attribute part of that to this center. I’d obviously rather save $500 and spend time with my son, but I hate the idea of directly sending someone home, especially when they’re doing a great job.
‘Our littleman already has awesome social skills,’
Well, I know I was charmed and I haven’t even seen him in person.
How about another photo of the lad!
Yeah, daycare can be crazy expensive and a general pain-in-the-arse.
We’re set for the next couple of months (part-time at-home care from someone we know), but we have to figure out something in the spring ourselves. (Gah.)
Local daycare economy aside, my feeling is that if you have the time and ability to watch your kids some or all of the time, you should do it. The part-time thing sounds like it might be a good compromise so you can save a little, spend some time with the lad, and actually get some work done during some of the week.
“The part-time thing sounds like it might be a good compromise so you can save a little, spend some time with the lad, and actually get some work done during some of the week”
Our thoughts exactly ET.
I know we’ve discussed this before, but this is the main reason my family wants to move back to NY. Grammy and Nana are expert sitters!
Damn, I was just getting used to the S. Florida insanity.
I was just thinking about all those off shore and Switzerland bank accounts. Are these banks going public to share in the government largesse?
Ponzi schemes are coming out of the woodwork anymore. I hope Barry’s Institute tries hard not to set their sights too high.
Lennar Declines After Minkow Alleges ‘Ponzi Scheme’ (Update2)
By Bob Ivry
Jan. 9 (Bloomberg) — Lennar Corp. fell as much as 28 percent in New York trading after Barry Minkow’s Fraud Discovery Institute alleged that the company operates joint ventures “like a Ponzi scheme.” Lennar denied the allegations.
Minkow posted his accusations today on a Web site called lenn-ron.com. The company has failed to disclose material transactions, Minkow said on the site.
“These are false allegations,” Lennar Chief Financial Officer Bruce Gross said in an interview. He declined to be more specific and said the company will issue a statement later today.
Awesome video! Thank you!
Whiskey Tango Foxtrot, Batman!
From Enron to today, one would be inclined to think that many large corporations are.. well, crooks.
Which sort of puts a crimp in any kind of “economic” analysis, wouldn’t it? At least any that don’t factor in the “lying, cheating, stealing” numbers.
“…Exports of gas from Russia fell 6% between 2006 and 2007 according to the BP statistical review of world energy. Production fell from 612.1 to 607.4 billion cubic meters (bcm) per annum and domestic consumption rose from 432.1 to 438.8 bcm per annum leading to a fall in exported gas.
Is Russia withholding gas supplies leading to higher prices and manipulation of its market position? Or is the Russian gas supply system unable to meet demand?”
The Oil Drum Europe
Price manipulation AND geopolitical strategy. (regional political control)
I believe that most people who post here are frugal. I quit being a consumer in 2005. Now almost everyone in my family has stepped off that bus as well.
My conversations with them reveal that the old bad habits of mindless shopping….will not happen again.
My family that is spread out over several states are tightwads now. Going to the store with a list and buying NOTHING else.
It seems the plans of being ultra tighwads is anywhere from 3-5 years. Cash cushions are building up and I don’t think it will be easy to get them to let loose of their money ever again after what we are going through.
I actually find that I am living a better quality of life when I left being a consumer and became a citizen again. My bank account is healthy too.
Good going, you have the power! They need your cash more than at any time in last thirty years (at least).
Looking back ten days using a 15 minute time scale, the recent uptrend line is clearly broken. A new downtrend line is developing. There is support right above 888. How long does it last?
Forbes.com
How Social Security’s cost of living increase became 2009’s first stimulus package.
While a new Congress and a new White House debate details of an economic stimulus plan, Social Security recipients are already reaping a $38 billion windfall.
[...]
Last year, soaring gas prices sent the Consumer Price Index skyward, and in October the Social Security Administration set the cost of living increase at 5.8% for 2009.
That’s the largest adjustment since 1982, amounting to an extra $35.8 billion, says SSA spokeswoman Kia Green. The increase for Supplemental Security Income is an additional $2.5 billion.
Since then, prices have collapsed. In November, the most recent month the figure is available, the index used to calculate Social Security benefits decreased 2.3%. In December, it’s likely to have fallen further, increasing the economic impact of the checks for recipients and potentially helping to stoke consumer spending.
“If they perceive they’re getting a raise in their Social Security benefits, it should have a stimulative effect,” says Andrew Biggs, a former deputy commissioner for the Social Security Administration and a resident scholar at the American Enterprise Institute. “Seniors seem to be very pleased that they’re getting such a large COLA,” Biggs says.
[...]
What will happen to prices over the course of 2009 is anyone’s guess. If inflation returns as the Federal Reserve increases the money supply, that cost of living increase could quickly be eaten away.
A best-case scenario for Social Security recipients would be if deflation sets in. The cost of living adjustment does not decrease if the cost of living goes down, it only increases when costs go up.
Copyrighted, Forbes.com. All rights reserved.
“A best-case scenario for Social Security recipients would be if deflation sets in. The cost of living adjustment does not decrease if the cost of living goes down, it only increases when costs go up.”
Generation greed strikes again. They’d better repeal that right quick, and have the benefits decrease at the same rate as wages.
Generation greed???
You obviously do not support or care about an elder family member who has been ravaged year after year by the corrupted gov’t statistics on cost of living.
I think you are expressing your own generational greed. Maybe I misunderstand what you said.
+1
+2 (and I’m Gen X). The seniors have been shafted, just like the rest of the savers, over the past decade+.
I’ve long wondered where the AARP has been all this time when the Fed kept rates artificially suppressed.
Wait until next year’s COLA is negative. Seniors will be HOWLING!!
WT said it never goes negative.
Bernie Madoff Swindle
Not sure if this was posted before..
http://www.informationclearinghouse.info/article21507.htm
From the article one positive benefit is
.. Madoff’s long-term, large-scale fraud was not detected by the Securities and Exchange Commission (SEC) despite its claims of at least two investigations. As a result, there is a total loss of credibility. More generally, the SEC’s failure demonstrates the incapacity of capitalist government regulatory agencies to detect mega frauds. This failure raises the question of whether alternatives to investing in Wall Street are better suited to protect savings and pension funds.
SEC - Nothing but castrated lap dogs. They exist only to muddy the waters.
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4177766/Merrill-Lynch-says-rich-turning-to-gold-bars-for-safety.html
Merrill Lynch says the rich are turning to gold bars for safety. That seems a lot smarter than turning to Merrill Lynch or anyone else on Wall Street.
Jan. 9 (Bloomberg) — VeraSun Energy Corp., the second- largest U.S. ethanol producer, has idled three distilleries as demand falls and prices fail to cover the cost of production.
…
Corn rose 58 percent from January to July last year, squeezing ethanol producers, before falling to 13 percent below year ago levels today.
No deflation here…
After your disucssion of milk prices the other day, I paid special attention at a local store this morning. $1.99 a gallon. Furthermore, this was at a union run Dominick’s on Chicago’s north side. Prices are typically so high at this particular store that I only buy the bare minimum and only when the weather is bad - like this morning.
Cheese prices were still high though.
No deflation here…
Yet…
…has idled three distilleries…
What happens later?
(I think this is what hoz is trying to get across.)
41 percent increase in bank robberies in Orange County, CA, over 2007.
http://www.ocregister.com/articles/robberies-bank-increase-2276316-banks-county
Why follow the law, when you see the pigs on Wallstreet raping the system. I suspect we will see a lot more of this. You just wish they would rob the homes of people like Mozillo, Fuld, Lay ect. I bet that a jury might not even convict a guy who robbed one of these guys and then kicked his A ## for good measure.
BOSTON (Reuters) - Hedge-fund firm GMB Capital Management, run by a Massachusetts Institute of Technology professor, is shutting a fund after losing more than $50 million….
The fund once wooed investors with promises that it would rely heavily on the MIT professor’s complicated algorithms to deliver low volatility where prices almost never change.
Instead, the father and son team seems to have done exactly the opposite — funneling a big chunk of money to Madoff, a financier accused last month of having run a $50 billion Ponzi scheme, investors fumed.
The MIT prof used the Madoff volatility smoothing algorithm
Does that require a tube of k-y jelly? :-0
Is that the varient on the least-squares method, known as the least-smart method?
Freakin’ awesome, old fashioned schemers hiding behind the cloak of technology.
It seems he was running his own scam off of somebody eles scam.
It’s scams all the way down.
You’ve just described Wall St.
‘The fund once wooed investors with promises that it would rely heavily on the MIT professor’s complicated algorithms to deliver low volatility where prices almost never change.’
Once again it’s like that stupid math mystique. It’s like showing a Zippo to cavemen, they get all excited. Next thing you know, they believe the person with the magic, and want to worship and bring offerings and stuff… has that sort of thing EVER gone good?! In the whole history of forEVER?! (That’s a rhetorical question.)
See, what saved me, was that I never did trust that math stuff. It takes all my digits to add things, and it always STILL comes out to be ‘fifty-eleven’, is why, so when confronted with clean cut guys in suits with their stupid little math notions, I just didn’t believe them.
And that’s why I’m in a mortgage I can easily afford, sitting here sweatless and calm as a mug, on a Friday afternoon. This weekend I’m going to plan my coming garden, instead of gnawing my nails and/or killing myself ’cause I’m all of a sudden poor.
I’m going to plant tulips! I like tulips.
Hey, anyone got some ‘Semper Augustus’ bulbs? A bargain at only 2,500 florins!
Hahahahahaa!
Of all the Two lips jokes available and I can’t post them on Mr. Jones’ blog. I’ll try a clean poetry.
There are Tulips in my garden,there are Tulips in the park, but nothing is more beautiful than our two lips meeting in the dark!
I’ll plant two lips. :>)
Hey oly, I am going to meet up with HWY tomorrow and we will tip a glass to our new mascot….Olygirrrl.
“..This weekend I’m going to plan my coming garden”
If my “bumper” crop of sunflower seeds comes to fruition in 2009…I’ll sent you a US postal “Flat Rate” box of ‘em!
ps,
If you want to feed the birds…I can send them with just their heads cut-off, you can stick your favorite real estate business cards on them, although…the ink may not be bio-degradable.
‘I can send them with just their heads cut-off,’
Jeeze, for a minute there I thought you was talking about the birds and I prepared for a freak-out. Then I read it again and calmed down.
But yes! I would love some sunflower heads! And in exchange I will send you, if you’d like, a whole bunch of heirloom poppy seeds, gathered here in WA, at various locations from Oysterville to Port Townsend, mostly out of someone’s grandma’s ancient flower-bed. A big variety of colors and flower styles. They’re so pretty, you can’t imagine.
Somniferum variety, just so you know. I like multi-use flora.
O.K., sounds like a barter…but the Ill-rational. Rational. Service. might be knocking on your door over this offer.
It’s a good thing the Federal Gov’t doesn’t read Mother Earth or the HBB…Olygal, ever read the NYT article about the gov’t investigation of NYC flower shop owners? This was BEFORE Homeland Security.
http://en.wikipedia.org/wiki/Opium
This dude had incredibly long arms…
Tremont forced to halt redemptions
Financial Times, UK - 5 hours ago
By Deborah Brewster Tremont Capital Management, one of the main companies which funnelled investor money to Bernard Madoff, has been forced to halt …
Mackenzie hedge fund alleged victim of Madoff
Globe and Mail, Canada - 11 hours ago
Canadian investors in Mackenzie Financial Corp.’s only hedge fund have become victims of Bernard Madoff’s alleged giant Ponzi scheme. …
Madoff Investors Paid Fees to Funds for Profits That Vanished
Bloomberg - 23 hours ago
By Katherine Burton Jan. 9 (Bloomberg) — Investors wondering what happened to the $50 billion that disappeared in Bernard Madoff’s alleged Ponzi scheme …
For Mr. Balter, Madoff Effect Lingers On
Wall Street Journal - Jan 8, 2009
By GREGORY ZUCKERMAN For years, Brad Balter lost business to Bernard Madoff and warned investors about him, saying his results were too good to be true. …
How to avoid a Madoff fund
San Francisco Chronicle, USA - Jan 8, 2009
Right in the middle of the worst financial crisis since the Great Depression, reports come of the biggest financial fraud ever. The numbers are staggering …
Funds of Funds & Madoff: ‘Like Presiding Over the Long-Term Funeral’
Wall Street Journal Blogs, NY - Jan 8, 2009
David Walker, of Financial News, files this dispatch on how funds of funds are discovering the high cost of having done business with Bernard Madoff. …
Investors seek more than $1 billion in fees paid to feeder fund
MarketWatch - 4 hours ago
By Alistair Barr, MarketWatch SAN FRANCISCO (MarketWatch) — An investor has sued Fairfield Greenwich Group to try to recoup more than $1 billion the …
Fort Worth employees’ pension fund caught in Madoff scheme
Fort Worth Star Telegram, TX - 10 hours ago
By MIKE LEE FORT WORTH — The Fort Worth Employee Retirement Fund could be forced to pay back $10 million it invested with Bernard Madoff, who is charged in …
The liability focus of the Madoff fraud shifts from fund of funds …
Opalesque, Germany - 17 hours ago
From Kirsten Bischoff, Opalesque New York : For Fairfield Greenwich Group, which has been listed as the largest investor in Bernard L. Madoff Investment …
Fund-of-Hedge Funds Lacked Technology to Avoid Madoff Losses
Advanced Trading, NY - Jan 8, 2009
Expert contends FOHFs didn’t conduct due diligence, but a system would have helped to raise red flags. By Ivy Schmerken Fund-of-hedge fund managers (FOHFs) …
Bramdean writes off Madoff investments
FT Adviser, UK - Jan 8, 2009
Bramdean Alternative’s investment trust has announced it will be writing off the full cost of two investments it had in hedge funds run by Bernard Madoff. …
http://www.telegraph.co.uk/finance/4125947/Willem-Buiter-warns-of-massive-dollar-collapse.html
The UK and German financial media have done a vastly better job than our MSM at reporting the true state of the US economy and the grim prospects for the US dollar, including this warning of a dollar collapse.
An apt warning, IMO.
At some point it becomes more and more apparent that the U.S. will be defaulting on its debt. Then it’s Katie-bar-the-doors. 2-5 years from now sounds about right.
This clearly must rank as one of the longest-anticipated catastrophes in human history.
“…must rank as one of the longest-anticipated catastrophes in human history.”
No, personally, there was that time…Nov 4th 2000…until… Jan 20th 2001
Closing at the lows.
Did you guys see that? They got right up on the downtrend line around 2:30 - 3:00pm and got whacked. SPX low 888.31, closes at 890.
‘Boeing Plane Division to Cut 4, 500 jobs’
http://www.msnbc.msn.com/id/28580704
‘Most of the job cuts announced Friday are expected to occur in Washington state in the second quarter of the year, the company said. Boeing says employees will receive 60-day notices starting in late February.’
Oh. My. Sweet. Baby. Jeebus….
Primey! Remember when you predicted this?
This is gonna hurrrrrrrt.
Compared to 45,000?
Just a flesh wound!
If any Bay Area HBBers were fans of Creature Features when Bob Wilkins was the host (on KTVU Channel 2) has passed away. I used to watch the show just to hear his comments and the people he interviewed.
Here’s the link:
http://tinyurl.com/6w6hmt
Off topic, but……what are they bitching about????
TIME Magazine “The Bush Administration’s Most Despicable Act” (by Joe Klein)
From the Armed Services Committee Report: “Military working dogs had been used against Khatani. He had also been deprived of adequate sleep for weeks on end, stripped naked, subjected to loud music, and made to wear a leash and perform dog tricks.”
I don’t see what the problem is……this “torture” sounds like the job description where I used to work.
I did that job for eight years, and didn’t see anyone from the ACLU, the UN, or Time Magazine ONCE.
The Russians must be laughing their asses off.
‘…stripped naked, subjected to loud music, and made to wear a leash and perform dog tricks.”
Gosh! I was gonna say, just add some guacamole and more beer— sounds like a party to ME.
RE: this “torture” sounds like the job description where I used to work.
I saw the pics. My fraternity initiation in ‘72 was infinitely worse.
Thank You Sir…Care for another?
Page 144 of January Oprah mag features our own ahansen.
She talks of the bear attack, great photo of her and the doggie heroes.
Way to go! She looks great, and so do the pups!
Ack!
In a curious irony, for the same feature they also interviewed a now-unemployed vice president of Lehman Bros. and a similarly F’d twenty-something ex-Realtress from Manteca.
The shame…the shame….
Nice pic of my dogs, though.
Maybe she’ll do an article on the CFO of Lennar…a $5 million 3rd in Laguna Niguel, CA
So, exactly why are the builders not below $1.00 USD ? Oh, they have value! …looking forward…Warren, can’t Berkshire just SNAP them UP?..And I thought Berkshire was all about value growth? I’m so…disappointed.
Also in this weeks People page 111.
Didn’t post, so will redo, sorry if it comes through twice, interesting website:
www dot layoffdaily dot com
Friend who does most of Aspen’s structural engineering (houses, some commercial) just laid off his main engineer, things are very very slow, he reports.
I have that website, but it leaves out a few companies that I know PERSONALLY are and have been laying off.
Life up North will be so depressing once Gov. Rod Blagojovich is out of office. Nothing of interest to read locally. Maybe the new senator from Illinois can be Ms. Carol Mosely Braun again,. She was great copy! Trips to Africa and Haiti. Awesome quotes.
“The notion that we won the war against Iraq is like saying we won a war against Arizona. I mean, the fact of the matter is it’s not that big of a country. Nobody, I don’t think, had any notion that we would do anything but win it.”
Ms. Carol Mosely Braun
“The notion that we won the war against Iraq is like saying we won a war against Arizona. I mean, the fact of the matter is it’s not that big of a country. Nobody, I don’t think, had any notion that we would do anything but win it.”
Ms. Carol Mosely Braun
See what happens when a movie actor invades Grenada, with the full force of a taxpayer equipped military from America..it leaves a feeling of invincibility to the rest of the Nation.
Lol. True, but compare the size of the Army of Iraq vs the total population of Arizona. (1,000,000 (if you include reserves) vs 6,500,000)
I think it’s fair to include reserves since I am including realtors in the Arizona forces.
Another Madoff victims
The Fair Food Foundation
Ann Arbor, MI
A Michigan foundation committed to getting healthy food into poor, urban areas is going out of business, a victim of the multibillion-dollar fraud case filed against a New York investment adviser. The Fair Food Foundation, based in Ann Arbor, said it will close its operation over the next few weeks. The foundation’s mission was to make grants to improve the availability of fresh food in areas like Detroit and Oakland, Calif. On its Web site, the foundation said it relied on donors whose money was managed by Bernard Madoff, who is accused of fraud. The donors were not named.
Source: Detroit Free Press
Important question: Are Megabank, Inc’s oil hoarders using your tax dollars to drive up the price of your gasoline?
Friday, January 9, 2009
American Public Media Marketplace:
Investment banks hoarding oil
Stacks of oil barrels
Fifty million barrels of oil are just sitting around on supertankers. They’re not getting unloaded because investors are waiting for the price of oil to go up. Mitchell Hartman explains.
Bob Moon: Now here are some millions that haven’t raised the ire of Congress — 50 million… Barrels of oil. They’re sloshing around on huge supertankers right now. They’re not going into port, not getting unloaded. They’re just waiting, for the price of oil to go up. It’s a financial play known as “contango.” A lot of investors are getting into the act. Marketplace’s Mitchell Hartman explains.
The oil is not just sitting around. The current annual return on holding oil and selling a 2 month future is 36% per year, it had been 60%apr. How can you sell something that is already sold? You become unhedged subject to the vagaries of geo political concerns. “He who sells what isn’t his’n; buys it back or goes to prison.” Most of the tankers will end up going to China.
The problem is getting more tankers. Just not available. Oh well it was good while it lasted. The tankers are cheap to be docked, the cost of moneys is non existent for 3 months.
A contango is when the cost of the future contract (Oil, grains etc) is greater than the cost of the spot market + storage + interest rate = carrying cost.
“…They’re not going into port, not getting unloaded. They’re just waiting, for the price of oil to go up.”
Is $25.00 a barrel up?…just blogging in my mind from Australia…the land… “down under”
Did Megabank, Inc intentionally financially engineer their sliced, diced and tranched MBS to create a “poison pill” defense against subsequent loan modifications? If so, I would say that was pretty clever of them…
American Public Media’s Marketplace
Friday, January 9, 2009
Panel criticizes Treasury over TARP
A Congressional oversight panel released a report today that criticizes the Treasury Department’s handling of TARP money. Nancy Marshall Genzer reports that Congress now feels it has to clamp down on the department with more oversight.
…
Kathleen Day says Treasury hasn’t lived up to its obligations to Congress. Day is with the Center for Responsible Lending. She says Treasury focused too much on getting banks to help homeowners voluntarily, rather than forcing loan modifications.
Kathleen Day: Mandatory adjustments, mandatory lowering of monthly payments on a mass scale, modifying, even millions of loans, quickly.
But Scott Talbott says that’s not so easy. Talbott is the chief lobbyist for the Financial Services Roundtable, which represents the nation’s biggest banks. He says many mortgages were sliced up and sold as securities to different investors, who would all have to sign off on a loan modification.
He says many mortgages were sliced up and sold as securities to different investors, who would all have to sign off on a loan modification.
Thats funny just picture Barney Franks face when he figures this out
End of Wall Street: What Happened
One thing they dwell on: Easy Money, described as what happened after 9/11 when the Fed pushed interest rates all the way down to 1% and held them there for a very long time.
So a if 1% FFR constitutes easy money, how should one describe ZIRP?
The End of Wall Street: What Happened
- It’s a WSJ video retrospective
- Highly recommended — one of the best pieces of reporting on the financial crisis I have seen to date
- It seems a problem in the early 2000s that had much to do with the crisis at hand was easy money — ultralow Fed Funds Rates of 1%
- It also seems the FFR is currently 0% — so WTF did anyone learn???
“These are the most massively complex financial institutions on the earth.”
It seems they were too complex to function very well. Hence they should have been allowed to fail. We get to enjoy more of this going forward so long as the government (or whatever kind of entity the Fed happens to be) enables too-big-to-fail firms to destroy billions upon billions of dollars, then dump the losses on someone else.
Someone please remind me why OBwan’s economics team has so many key members who were intricately involved with creating and overseeing the economic disaster at hand. Were these the only possible choices? Why do their newfangled solutions sound so similar to yesterday’s failed solutions?