Bits Bucket For February 1, 2009
Please visit the HBB Forum. Post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
November 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
Yahoo’s finance page today has this personal finance link titled:
“What Is The Value Of Reducing, Postponing or Foregoing Expenses?”
Not a big deal, just a calculator that counts up how much you save from eating out $150/month less over 10 years. (Eat out less and carpool to work saves $46000 over 10 years, if instead invested in a no tax 8% investment.)
Not a big deal, except that they feel people are actually getting to the point where they would care again.
8%, tax free?????
Buahahahahahahahahahaha!
We’re talking about people who have never opened an IRA, so yes, tax-free…
Now, those who have maxed out their tax breaks are in a different position indeed…
Hell, I would stay away from munis–no guarantee that Obama will save all the states and (esp.) local gov’ts from default. Risky, risky, risky.
1) Where you gonna get 8%, even in an IRA?
2) You still have to pay the tax when you take it out. Unless you mean Roth, which I do not trust will remain tax free growth.
If you and your spouse bought $120,000 worth of Series I bonds in the year 2000, they would be yielding about 8.4% today. If you did the same in 2001 they would be yielding 8% today. 2002 I bonds would yield about 7% to 8% today. You could have put $480,000 in series I bonds in four years and be earning a big chunk of change annually. The earnings are not taxable until you redeem them. They have to be redeemed by 30 years from their issue date, long after the high tax and high socialist era is over with. And the nice thing is these annual yields have been over 5.2% since 2001. The variable part of the yield will likely to stay high since the Fed is inflating the currency.
Now the limit for purchasing I bonds is $20,000 worth per married couple per year. Still a good deal but not a windfall any longer.
If I would have bought bonds in 2000 or 2001, I would have lost them in the divorce of 2002, just like I lost everything else (except the marital debt).
All my savings goes into 401(k). Otherwise the government takes half of it right up front.
The base rate for the i-bond is now 0%!
But during the dot com boom we were “maxing out” on i-bonds! They were paying 6.9% then, and we knew that a guaranteed 6.9% (with tax advantages) beats anything else we could do.
While all our friends were buying pets.com, we told them we would put all the government would allow in i-bonds and they would laugh at us!
(The reduction down to $5,000 max paper/on-line/per-person is just another effort of our Government to punish savers)
The fixed rate since November 1 is 0.7%, Reuven. The 0% was from April 2008 to October 31.
Haa, $46K, I’ll just extract it from my equity.
What? I’m not allowed to? Waaaaa.
Fix it, Obama, please!!
Jan. 31 (Bloomberg) — London luxury-home prices had the second-biggest decline on record in January as would-be buyers struggled to secure mortgages from banks hurt by the global financial crisis.
The average value of homes costing more than 1 million pounds ($1.4 million) in London’s most expensive neighborhoods fell 3.7 percent from a month earlier, Knight Frank LLP said in an e-mailed statement today. In the past 12 months, prices have slumped 21 percent, the biggest annualized drop recorded by Knight Frank.
London isn’t the only prime residential property market to lose value because of the credit crisis. In the Hamptons, the New York seaside resort favored by financiers and celebrities, median prices were 14 percent lower at $690,000 in January than a year earlier according to New York property appraiser Miller Samuel Inc. and broker Prudential Douglas Elliman Real Estate.
http://www.bloomberg.com/apps/news?pid=20601085&sid=aM9uEAUYNgvI&refer=europe
Go Cardinals!!!!
While I can’t find it, TMZ claims there’s a Vegas line on the time some popstar requires to sing her “interpretation” the national anthem..
First stanza is 80 words.
2:03 is the over-under.
~~~Then conquer we must, when our cause it is just,
And this be our motto: ‘In God is our trust.’
And the star-spangled banner in triumph shall wave
O’er the land of the free and the home of the brave!
And where is that band, who so vauntingly swore
That the havoc of war and the battle’s confusion
A home and a country should leave us no more?
Their blood has wash’d out their foul footsteps pollution!
No refuge could save, the hireling and slave
From the terror of flight, or the gloom of the grave
And the star-spangled banner in triumph doth wave
O’er the land of the free and the home of the brave!
Somehow this 3rd verse never gets sung.
“We are the Goobermint and we are here to help you”
From becoming the proud new owner of banks, houses and on to a financier of cars? Perhaps we should forget the old Uncle Sam and start calling and dealing with our new and improved Uncle Fast Eddy.
Often we hear jokes about burning or bulldozing the growing “surplus” of un-used and un-wanted US houses to spir new and expensive growth.
Now, CNN Money has a story about “Uncle Sam wants you to buy a car” to get rid of those unwanted and un-used new 2009 clunkers rusting on the car lots.
Hurry, they’re SNAPPING them up fast and you wouldn’t want to be left behind like a Dead Man Walking
http://money.cnn.com/2009/01/23/autos/government_car_incentives/index.htm?postversion=2009012912
So let me get this right. I am going to trade in my paid off car so that I can take on new debt in a down economy. Of course maybe I no longer work as many hours as I used to. Maybe my spouse lost their job. If any of these reasons apply I would not be able to get a loan.
Also how many of these cars are fuel efficient versus big SUV’s and trucks that fell out of favor months ago.
This is INFURIATING. I called CONgress and the staffers were unaccountably rude. I guess they are already counting on their used gas guzzler moneys.
If this government was really serious about doing anything for the environment, they would allow the marketplace to determine the size and composition of the auto industry on these shores.
Look at the percentage of the ballyhooed stimulus that is going to highways as compared to that going to rails/mass transit. They can put up all the windmills they want - it’s just window dressing.
Current events are offering this country a great opportunity to restore a more sustainable long term balance to our transport network - but instead its just business as usual with a few feel good treats like wind and solar thrown in.
can’t mess with the road construction mob
I love how it’s “rail is useless and costs too much tax money” when it’s ROADS that cost more money–and whenever times get tough, the road construction lobby comes with their hands out asking for “jobs creation”
When you lay rail, they can stay in situ for up to 50 years with minimal maintenance*. Who since the Romans has built a highway to last that long?
*-exception: a couple of disastrous experiments with inappropriate ties–granite in the 19th, concrete in the 20th.
Go Steelers!
I’m going to see if I can be positive for a change.
About a year and a half ago, Ben had a weekend topic “What would you do to fix it?” or some such. I guess he was going through a bargaining phase.
There were lots of proposed solutions from “let ‘em fail and RTC ‘em” to “canned food and ammo”. We foresaw stuff like cram downs, bank nationalizations, stimulus, government buying loans and reworking, government guaranteeing debt, etc. But, none of these seemed appealing to me, so I spent days thinking about it.
I came up with the Darrell_in_PHX plan. (Watched Daily Show last week, and Stewart was interviewing Gwen Ifill. He presented the Darrell_in_PHX plan as if it as his own… intellectual property thief.)
I started with the problem:
Household debt had grown much, much faster than incomes. 50% increase in income, 180% increase in per-household income. Oh, toooooo much debt. Okay, debt nationalization!
My suggestion was that we do a $3 trillion cash handout. If you make less than $10K per household (2006 1040), you get $10K. If you make $10K-$50K (median household income), you get 1x income. If you make over $50K, you get $50K – some phase out factor.
If you have a little too much debt, you get help. If you have WAY too much debt, you are still fooked. If you have no debt, you get a chunk of cash to compensate for lost purchasing power from your money you are sure to lose. Current renters get cash for a down payment, etc.
I had a bunch of stuff like “if you work in the R/E industry you get nothing”. Okay, that is too hard. Now I’d just say, if you already have forgiven debt, the money goes to those debt holders.
At the time $3 trillion seemed OUTRAGIOUSLY large. We’re now talking about $2 trillion+ being added to the national debt this year. Not quite so outrageous.
If anything, this may only be a phase 1.
However, upon further review… Paying down debt makes the money supply shrink, right? Assuming the Fed bought all $3 trillion in new debt, and we also regulated Wall Street as part of this to ensure the debt didn’t just come right back, would this actually be deflationary instead of inflationary?
Actually, Stewart’s was more of a “blueprint” than a real plan. The banks need money and we need less debt. Handing money to the banks helps the banks but not us. Why don’t they hand the money to us, we use it to pay down debt, and the banks end up with the money anyway. We’re both helped.
Yeah Mr. John Stewart… Great idea… WHEN I CAME UP WITH IT 18 months ago!
I stopped reading your post when I got to the word “plan”. Any solution that includes the word “plan” blows the proverbial donkey dong.
The only solution is no solution.
“blows the proverbial donkey dong”
that’s plan B.
Youtube video?
So, greater depression?
That is my second option is debt nationalization fails.
I have news for you.
The debt nationalization has already failed. You may mitigate some of the horrors now but the system has h*mped the p00ch real good! It’s barely crawling now.
They tried to nationalize it from the back end. They haven’t tried nationalizing it from the consumer side.
We have a crumbling house of cards, and they tried to rearrange some of the top cards so they could get it growing again.
Time to accept we can’t get it growing again, and start disassembling it from the top down.
They never will.
There is no utility to the PTB to have the plebs let out from under their mountain of debt. Any one who thinks otherwise has no clue of how the game is played.
Then us plebs will let ourselves out from under the mountain of debt by simply not paying it back. Oh, wait… Already happening.
Right, and that’s the way going forwards.
Back-stop the banking system, and equilibrium will be found in the middle.
They are trying to bail-out a tsunami with a teaspoon here.
I am doubtful of the positive long term effect on the economy from bailing out J6P as you propose Darrell. It will be the ultimate moral hazard. People will forget very soon what got them in the bad situation in the first place and will keep on spending beyond their means until we are again in the situation we are currently at.
The coming depression has it purpose, and it is similar to the purpose of a hangover after a drinking binge – it teaches you that your body has limits. As FSSP said, the damage has already been done (during the wild drinking party we had over the last several years). PTB will try to mitigate the crisis (taking some aspirin or hair of the dog to reduce the terrible headache), but they cannot just cure it. It must take its course and it will.
As opposed to the moral hazard of those who invested in banks, mbs, hedge funds ect ect.
One improvement might be warning people this is coming at a particular date. In the fooked category, it could stimulate resolutions to get finances squared away (walk away, bankruptcy, maybe (gasp) saving), whatever is required to get in on the “free” money without some bank sueing you for it for defaulting on a recourse loan.
Of course, gains in this demographic would be counteracted by regression in the “merely screwed” category, since it means they can start charging up 50k more even before the money arrives.
But hey, that would stimulate the ecomony, so I would applaud their sacrifice, as long as they start actually enforcing consequences.
I proposed a very similar solution and got the same responses at that time. Right now the banks are being given money and are directed to write off debt. The banks decide who will benefit and generally it is the biggest offenders.
I proposed the government gives everyone a $20K credit, pulls everyones’ credit reports, and pays their debt in order of earliest maturities first. Anyone with less than $20K in debt gets the remainder in cash. Ultimately, the banks still get the same cash they are receiving now, but the write-offs are fair and orderly.
Most here want no government intervention at all, but we know that is the one thing that will not happen. Right now the fools in DC hold more power than any other time in my history. They are loving it and they are hell bent on abusing it.
Wall Street workers lament different loss
Government scrutiny falls on compensation
By Eric Dash and Louise Story
NEW YORK TIMES NEWS SERVICE
2:00 a.m. February 1, 2009
Sen. Claire McCaskill, D-Mo. (left), has proposed a bill to cap workers’ pay at banks that received bailout omney. (New York Times News Service) -
NEW YORK – There was none of the old swagger at Citigroup headquarters last week. The bonus checks had landed – and some of the bankers were grumbling.
…
If you’ve never worked on Wall Street, it is hard to wrap your head around the idea that a company that lost nearly $19 billion in a single year, as Citigroup did in 2008, could still pay its employees billions in bonuses. It is probably even harder to believe that some of those employees grumble about it.
“I feel like I got a doorman’s tip, compared to what I got in previous years,” said a 30-something investment banking associate at Citigroup’s offices in lower Manhattan.
GOOD RIDDENS …quit citbank and go find a REAL job you Moron!
———————
“I feel like I got a doorman’s tip, compared to what I got in previous years,” said a 30-something investment banking associate at Citigroup’s offices in lower Manhattan.
Hey!…at least a doorman has sort of a REAL job and works for a living A$$clown
Actually doorman just opens the door for you and sign for packages/deliveries, etc. Not nearly useful as a super and a unnecessary luxury item that only exits in NYC for the most part.
Even in NYC, typically the super takes packages.
No doorman in my building. That’s actually one of the things I look for in a rental. They are just gossipy people with no particular utility.
‘They are just gossipy people with no particular utility.’
So, just like me! Except luckily I’m cute.
Hooray! Hooray!
Yeah, well? That makes ALL the difference in the world.
Plus, you drink, pick mushrooms and drink while picking mushrooms.
I bet you make a mean mushroom omelette too!
Mushroom and cheese omelette. MMMMM MMMMMM Good
Comment by Olympiagal
2009-02-01 11:20:37
>So, just like me! Except luckily I’m cute.
Hooray! Hooray!
AGAIN, THIS POST IS USELESS WITHOUT PICTURES.
Or at least age + dimensions.
You can’t take pictures of the Northwest Goddess of Mushroom-Picking. They’re almost impossible to catch in the woods, like unicorns.
Yeah, well? That makes ALL the difference in the world.
Plus, you drink, pick mushrooms and drink while picking mushrooms.
I bet you make a mean mushroom omelette too!’
It is all true. *nods cute, fluffy, iggerant, gossipy head in solemn and modest agreement*
Especially the drinking while picking mushrooms part.
And you know what’s SUPER good? Is a morel and OYSTER omelette. Why, that’d make even Sweet Baby Jeebus scream with pleasure and decide we’re not all a big mistake after all!
Why you have to torment me over morels I dunno but I bet you there’s a special circle in h*ll just for that, young lady!
Oly, are those regular mushrooms that you grow & pick or are those “funny” mushrooms, if you know what I mean? Even though if it is the latter that explains a lot….
‘Why you have to torment me over morels I dunno but I bet you there’s a special circle in h*ll just for that, young lady!’
Morellllls, morellllls, mORELLLlllllssssss… this is one of those times that the written word cannot convey the singy-songy sassiness that is my way. I’ll just do the best I can.
If the morel season is good this spring, I could overnight you some, to your super-secret villain lair. I’ll even jam in some pretty moss, a clod of mud, and the bottlecaps to a few beers in the package! Think of the heaven, man.
‘Oly, are those regular mushrooms that you grow & pick or are those “funny” mushrooms, if you know what I mean? Even though if it is the latter that explains a lot….’
Oh, I doooooo know what you mean, as it happens.
And my theory towards ALLLLLL mushrooms is: ‘The More the Better’.
Hahahahaha!
Hey, look! There’s a leprechaun on the front porch! Again!
“Is a morel and OYSTER omelette. ”
Isn’t that a classic Hangtown Fry?
‘Isn’t that a classic Hangtown Fry?’
Why, yes it is, smartypants! Except I don’t kill anyone when I make my breakfasts.
Unless they deserve it.
But, moving on, you know your goldtown history, huh? Did you know that SanFrancisco was once called ‘Yerba Buena?’
‘Isn’t that a classic Hangtown Fry?’
Yes. And where’s my first post?
GEEZ I could retire after a few years with that kind of salary.
——————————————————
“Without a doubt, $18 billion is a lot of money, but it’s a drop in the bucket on Wall Street,” said Gustavo Dolfino, president of the WhiteRock Group, a headhunter for the banks. “These bonuses are down, and the salaries are not enough for these people. They can’t live on 150 to 180 thousand dollars, so they haven’t saved any money. They put it on credit lines, and at bonus time, they thought they’d pay it off.”
Correction here:
“They can’t live on 150 to 180 thousand dollars, so they haven’t saved any money.”
Should be:
“They can’t live their lifestyle on 150 to 180 thousand dollars, so they haven’t saved any money.”
Most people that I know can scrape by $150 to $180k, but it does mean being part of society, to some extent. This includes NOT having a chauffeur (i.e., finally getting your drivers license), eating at $50 restaurants (rather than $500), living in ungated communities, and maybe even sending your kids to public school (something I don’t wish on any kid, but it fits well here).
Public schools in NYC are just fine (except for some ‘hoods, not where WS playas live, naturally), actually there is some competition over getting in the district for certain ones.
What’s really hilarious is the way the elite class would fight over preschool slots!
I agree, I’ve read those stories. It’s funny, I bypassed all of that crap by teaching my kid to read at 3.5 years, and then zipping him through math. I even tried to get him into one of those elite schools for kindergarten, but they didn’t want him. He should done with engineering school just prior to his 17th birthday (he’s 14 now).
*I* went to public schools in NY, and I’m fine!
But if you’re gone to those double-plus extra-good schools you might have been double-plus extra-good instead of just fine.
Jes’ sayin’.
Lol, GWB went to Phillips Andover, hardly a ringing endorsement.
Now Sidwell Friends, I happen to know that’s a decent school. But Montgy County still beat them in “It’s Academic” tourneys plenty of times.
(sekrit story about privvit skools: they offer less rigorous courses than public schools b/c they are too small, so past 10th grade you are actually getting LESS education… however, they do spend a lot of time helping you “get in”. One friend I knew got sent there by her mother because of the small size=more attention, because young Alie had mastered the “green slip–cutting class” routine and was on the verge of dropping out. Still, it was kind of a joke–no calculus? Really?)
“They can’t live on 150 to 180 thousand dollars”
WHAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAT?????
Let me have a chance at trying it. Yep, just one chance.
Wait until he really is working for doorman’s tips!
And do you have any idea WHY you got what you did in previous years ????????
I think these arrogant punks in suspenders are getting some really bad dope from whoever put together the talking points advising them to adopt an unapologetic, “I work 80 hrs. a week,” “Yeah. I earned it,” stance when asked questions about excessive bonuses. These “Masters of the Universe”-in-training are out of touch with Main St. America, and so are the hacks who put together the PR memos for them. Granted, the vast majority of Americans are too stupid and/or distracted to get a clue about what is going on. However, among the minority aware of the “Wall Street Shuffle,” I think there is a real deep-seated, white-hot resentment against these flippant, manicured punks that burns only hotter when they get our faces with their “Shut up. I earned it” ‘tude.
+1
These Brooks Brothers-suited punks couldn’t see the monster tsunami from the quake they unleashed coming to wipe them out.
So their whining is just hella funny. If they really “deserved” all that pay, then how come they didn’t batten down the hatches two years ago like I did? Clowns.
These Wall Street geniuses killed the goose that laid the golden eggs. Their greed became soo much they destroyed it all.
They destroyed their *own* companies.
They deserve nothing!
kill the host capitalism
in microcosm what happened in macrocosm — the host being Main St, the host being the employer
sweet, sweet Schadenfreude
also serves them right for sniggering at those Bear Sterns employees on the street last year. Bear Sterns was known as the place that would give the children of the Lumpenproleriat a sporting chance if they demonstrated ample aptitude for hard work.
RE: I think there is a real deep-seated, white-hot resentment against these flippant, manicured punks that burns only hotter when they get our faces with their “Shut up. I earned it” ‘tude.
“Death of the Big Suit”…
Got body armour?
There is a place for ex suits here in Cleveland; a new start awaits them in their aunt’s basement. A few quiet weekends will have them crying themselves to sleep listening to oldies on the AM clock radio. They’ll learn how to make do on 38K a year working at uncle Mort’s deli. There’s always room here for one more. Ohio needs well adjusted workers.
I like your story very much, Carlos. But I’d like you to include a bit where there is a leaky faucet, in the auntie’s basement, going ‘tap…tap…tap……….tap’.
In the story.
There’s nothing like a leaky faucet to make you feel futile in the face of the Universe.
Oh, and the AM clock radio should short out and be staticky a lot of the time.
But I’m just suggesting details, overall this is a SUPER story, and I grade you with an ‘A’.
“Pride goes before destruction; a haughty spirit goes before a fall.”
Watching these clowns get the arrogance knocked out of them is going to be priceless.
“I feel like I got a doorman’s tip, compared to what I got in previous years,” said a 30-something investment banking associate at Citigroup’s offices in lower Manhattan.
I’ve got a tip for you, Jackass. Open your eyes. Overpaid, arrogant asses like you are toast. Retool your skill set to include something that society actually needs, and get ready for some long-overdue humility when you and your fellow suits are standing in the unemployment line.
Yep. Unemployment coming for a lot of these people. In my state, the max you can get in unemployment is $363 per week (pre-tax). Doesn’t matter if you’re a financial analyst, a CEO, or a janitor. That’s the MAX…
RE: “I feel like I got a doorman’s tip, compared to what I got in previous years,” said a 30-something investment banking associate at Citigroup’s offices in lower Manhattan.
These finance fat cats are greedy, avaricious, dispicable, human beings.
However, now their credibility is a big fookin’, fat, zero.
Call it the “The Death of the Big Suit”…
The main problem with the diversification strategies preached by 401(K) advisers: They did not include financial tsunami insurance.
Gail Marksjarvis: Diversification didn’t work well this time
2:00 a.m. February 1, 2009
There is a sense of betrayal among investors who have been conscientious.
When they talk about it, they sound like individuals who find themselves with a fatal disease after a lifetime of healthy living – eating a well-balanced diet, exercising and staying away from cigarettes.
“I thought I was doing everything right,” a lawyer told me recently about his 401(k). “I didn’t swing for the fences. I did what I was told. I diversified, and now look.”
He hadn’t picked a couple of hot stocks or relied on one stock mutual fund. He had assembled a combination of stock mutual funds and a bond mutual fund with the idea that if the stock market was ever brutalized, his numerous selections would buffer the impact.
Then came last year. The stock market crashed, and he lost about a third of his savings.
“…financial tsunami insurance…”
For that matter, pretty much only too-big-to-fail firms have it, provided courtesy of Uncle Sam. What’s more, they don’t have to pay any premiums (unless you count campaign contributions as premium payments).
Troy Paiva is a pioneer in night lighting photgraphy of old American relics like ghost towns, abandoned military bases, roadside cafe’s and auto and bus junkyards. He’s a cool guy that loves history, the American psyche and the west.
He is going to be very busy photographing and documenting all the American junk and abandon places that we leave behind from this bust and recession
http://www.lostamerica.com/
Cool site, thanks mikey!
I just glanced through, didn’t see a any photo’s of a wall street bronze bull with littered stock certificates piled around it.
Hwy50ina49Dodge
Troy has 2 books out and lots more photo’s on flickr. I love the one with a trashed and abandoned SAC HQ war room.
A Cold War Alert board with the bomber and fighter status, a huge deck, and 3 lonely curled and disconnected telephones in the center. Could almost be a late Wall Street Board. Once a busy and scarey place, now dead and forgotten. He’s cool
RE: Once a busy and scarey place, now dead and forgotten.
On my way back from Niceville FL to the Tallahassee airport, I took a roundabout way thru all these small, rural towns in the which had obviously seen their hey-day in the 40’s and 50’s.
Crumbling filling stations, old boarded up storefronts, seedy motel courts, rusting mobile homes et. el.
It was pretty spooky for a northern Yankee.
You couldn’t help by drive away with the feeling that America’s better days are behind it now.
‘Crumbling filling stations, old boarded up storefronts, seedy motel courts, rusting mobile homes et. el.’
Add the skinny cows and that’s where I done growed up, man. You know the movie ‘No Country For Old Men’? Man, that was FANCY upscale environs for me, had I seen them with young eyes.
Oh, and add the sagebrush, tumbleweeds, and the crumbly white alkali soil. I forgot that part.
There are three old SAC ICBM sites around Boise. They were rushed up around 1961 for the liquid-fueled Titan ICBMs, and were controlled by the Mountain Home AFB southeast of here. They only were operational until about 1965 when the much lower maintenance solid-fueled ICBMs came on line, and after that date were abandoned. I’ve actually hunted them up. Two are owned by a toxic waste dump company and the other is owned by some survivalist hippy who shows up at his gate with a 12 gauge.
Idaho is full of ghost towns. One, Idaho City, is still going strong. Back in its day it was bigger than Seattle or Portland. Another, Silver City, still attracts some rugged types who own shacks and camp out there in the summer.
Then again there is the ghost town of Democrat, Idaho. It’s really a ghost town. To get to Democrat, you have to take the gravel road to Whiskey Mt.
What a super link! Thanks.
I LOVE ghost towns. I growed up nearby to several Utarr ghost towns, I went camping in them a lot, and probed the ruins–respectfully, no trashing. Took many photos, read the research, if it was available…. I just love them.
I love his technique. He lights them modestly and uses super-long exposures (which you can see from the “trails” made by the stars from the earth’s revolution!)
Very cool.
mikey,
Great pictures. Thank you for sharing. I love the colors he uses in his photography. The old WWII sites in SF are fascinating.
I was saddened to hear from my dad yesterday that he lost over $100K in the stock market last year. I had been under the impression that he had gotten out of the stock market in Spring 2007 (on my strong warning for him to do so), but apparently he left a fair amount in play. It is hard to get eighty-year-olds to follow through on financial plans.
No kidding! Mine wouldn’t sell her company stock out of loyalty and that was a large part of the hit. At least they treated her well all her career.
Unlike the “greatest generation”, however, we all need not feel encumbered by such quaint notions of loyalty to company.
“Mine wouldn’t sell her company stock out of loyalty and that was a large part of the hit.”
That is truly sad. One of the worst financial booby traps created during the 401(K) era was that of companies pigeonholing their employees’ 401(K) investments into the company stock.
I made more during a previous runup and dump in company stock than I lost recently in the crash. Of course, if could easily have went very badly. Still, I hate losing the phantom value of this runup.
Raises hand…. $10s of housands lost on WCOM because I’d worked for MCI pre-buyout. Half my contribution and all of company match was in company stock.
Never again!
Yeah. My mother, a widow seven years now, lost $130k. She dropped a few hints about it to me, but I had to find out the figure from my most level-headed brother to whom she confides more. Worse than that, she now rents a townhouse from a friend of said level-headed brother but was seriously considering a purchase of stand alone house in the same development where she lives. Seller is recently divorced single mother with the place on the market for $229k. I told my mother she could get it easily for way under $200k in less than a year. Her response? “Yes, but I think the poor thing is in a bad way and really needs the money.” Oh, boy. Fortunately, she consulted level-headed brother. I’m sure he put the the idea right out of her mind in the terse and direct manner he has. Close one.
Sheesh Bear…what a waste. My brother says my Mom took a hit but hopefully noting like that.
A lot of people got burnt by those “In Wall Street We Trust” dollars
My neighbor told me her brother took a hit of 60k and now he
can’t retire as he planned ,he is 64 . My Nephew keeps getting laid off and calls me all the time for money to supplement his unemployment ,which isn’t really enough . Retired people I know who depend on interest income are screwed and some I have talked to have to dip into principle now ,which isn’t good if inflation is coming down the pike .
People who are trying to raise children are getting laid off and that is a really bad byproduct of this crash . I’m for any program that increases available jobs and forget the Wall Street Banks with their greedy little hands wanting money all the time . Its so much BS that these Banks/Investment Firms are anything but a drain on this Society at this point and will continue to be . Paulsons Bait and Switch will go down in history as the biggest con job in History . The laws were already in place as to how “Bad Banks” were taken over by the FDIC ,and the laws were in place as to who the losers would be. Does anyone think that limiting compensations offsets the highway robbery of the 700 or more billion in bail-outs for the crooks .
I am sick of these Political crooks picking and choosing who gets their pockets padded and who doesn’t . It’s a insult to tax paying Americans .Foxes in the hen house ……rant over .
+1. Nice rant…
“I’m for any program that increases available jobs and forget the Wall Street Banks with their greedy little hands wanting money all the time.”
It seems that the pols are starting to wake up to the fact that you can’t have stable banks or a stable economy without a financially stable populace. The problem is a lack of well paying jobs.
RE: Political crooks
Like Tom Daschle with his “little” $124k tax cheat problem.
Lotsa change here, between him and Geithner.
Well said, Wiz!
Sorry, but I think the boo hoo for the older folk that receive SS is misguided.
Say your Dad makes 2K per month on SS. At today’s savings rate, that equates to 2M in working captial.
It is the 40-54 year olds, not senior citizens that are in trouble. Little time to make up losses and no Social Security for them.
No comes the tsunami of pseudo-news stories and financial op-eds pleading with the peeps not only to keep their dough in the 401k - but to keep contributing as well.
The question to ask is…what were the big boyz doing with their holdings in 4Q 07. Did they ride this down?
Apparently the boyz recently developed an extreme fondness for T-bills (scroll down to see my post of a snippet from a current article in The Economist by Olivier Blanchard, chief economist at the IMF).
I’m sure everyone has seen that Edward Jones ad where a “financial advisor” is making cooing noises to a skittish “investor,” telling him not to get emotional about the ups and downs in the market. Sub-text: “At all costs, let’s keep the sheeple from getting spooked and stampeding for the exits, leaving us high and dry.”
Diversification did work. He lost a third, not half.
You are correct! The headline U.S. stock market indexes dropped by over 50 percent from Fall 2007 peak to Fall 2008 trough.
yup.. his glass is 1/3 empty, so he’s a pessimist, but he didn’t bet like one.. so no sympathy here.
I too diversified… broadly. Lost a mere 5% from the peak thus far.
You put your finger on the problem; diversification, as defined by 401(K) advisers, was far too narrow for a worst case black swan event.
Cash …
“I did what I was told”.
- every ruined investor on Wall Street
“I did what I was told.”
He should become a more selective listener.
“He should become a more selective listener.”
Or not listen at all.
Wall Street: “Do as I say..not what I do”
“Where are the Customer’s Yachts?”
the only sure thing about life is death.
I did what I was told.
Baaaaaaaaaaaaah says the sheep. Maybe instead of going through life as a passive, quiesicent little toolbox, you’ll start QUESTIONING what you’re told and using your head for something besides a hat-rack.
The main problem with the diversification strategies preached by 401(K) advisers: They did not include financial tsunami insurance.
Precisely! Your investments outside your 401k and IRA should be in 66% treasuries and 33% gold if you are past 40. When you are in your 20s and 30s you have a lot of years to recover from huge drops in your 401k and IRA balances.
Even if you think you have a secure job in a secure industry, you should have 6 months worth of living expenses for every decade you are alive.
I still am not in the clear because it appears I may have to help out a sister of mine who has been unemployed since October. She’s ineligible for getting taxpayer unemployment since she was forced to quit her job. This is the first time since the 1970s she’s been unemployed. She had the mindset that she will always be working, so why save money? Now her problem is likely to be my problem. But I want to help her.
Many people may think they are prepared for the depression ahead, but there will be dear relatives who become unemployed or cannot make payments. What are you going to do? Some of you here are sitting on $500,000 or more in T-bills. Do you have relatives that you admire and who are heading into difficulty?
I’m learning you cannot be too prepared for these bad times.
WRONG WRONG WRONG nobody is illegible for quitting a job….
most times they disqualify you for 8-12 weeks unless you did something so bad like expose yourself to the boss.
and the disqualification period gets tacked on at the end….so you still get 26 weeks.
tell her she needs to learn to read the unemployment book shut off everything in her house even the phones..and read.. Reading is a very lost skill today.
=======================================
I still am not in the clear because it appears I may have to help out a sister of mine who has been unemployed since October. She’s ineligible for getting taxpayer unemployment since she was forced to quit her job.
Hmm…I do not know the details of her circumstances but I was told she was at odds with the CEO of the hospital where she worked and that she had to quit or be fired.
She knows very well how to read and is educated. You imply she has no reading comprehension. Very condescending from someone who does not know that sister of mine.
aNYCdj, I’m sorry that I took offense. I looked up California Department of Labor’s web site and found the employment link. I e-mailed the link to my sister and she filled out the e-paperwork for unemployment.
Thank you!
No time for luxury
The era of $400 sunglasses, $300 jeans and costly private parties is over – at least during this recession
By Jennifer Davies (Contact)
Union-Tribune Staff Writer
2:00 a.m. February 1, 2009
The tumbling economy has been tough for everyone, but for businesses serving up heavy doses of aspirational affluence, it has been especially painful.
..
While housing prices ballooned, affluent consumers had a seemingly unquenchable thirst for $175 True Religion jeans, $400 Dolce & Gabbana sunglasses and $1,000 Gucci purses. For those aspiring to affluence, the purchase of a $300 Coach purse seemed like the height of luxury.
Now with nearly every sector of the economy hurting, those types of purchases seem downright foolish to some shoppers.
That’s certainly the case for Cyndi Haskett, 44, of La Jolla. She sheepishly admits to buying $75 T-shirts and $300 jeans.
“I have them and I’ll wear them, but I’ll never spend $300 on jeans again,” she said. “When I need a T-shirt, I’ll go to Target and get one for $10. A T-shirt is a T-shirt.”
Haskett said when she goes to lunch with friends, their past profligate spending is a big discussion point.
“Everybody’s attitude has changed,” she said. “You sit around and talk about it and you say, ‘What were we thinking?’ It’s embarrassing.”
‘What were we thinking?’ It’s embarrassing.”
I’ve always done my shopping at thrift stores, garage & estate sales, rummage sales, etc. I get the heebie-jeebies if I have to go to Wal-Mart or other such retail stores, which I have to do every once in a while. I spent my Christmas gift cards on new underwear and about had a panic attack at Penney’s.
If you have panic attacks on setting foot in J. C. Penney’s, then it sounds like you may have natural immunity to shopaholism
“natural immunity to shopaholism”
I’m a junk junkie. I inherited it from my pop. I like to grab the local fishwrap midweek and map out my Friday and Saturday garage/estate/rummage sale route. I like finding really weird stuff, my dad did, too. In Manhattan, he liked to go to old buildings that were going under the wrecking ball and bring home souvenirs.
So I got into the stuff biz, having inherited that genetic defect.
Hey, Muggy, is that place in Clearwater still around, the one with old fixtures and stuff from old Florida houses?
“Hey, Muggy, is that place in Clearwater still around, the one with old fixtures and stuff from old Florida houses?”
No clue, I’m not in the market for used house parts
Seriously though, where/name? I don’t know the place off the top of my head. The bicycling drug dealer I hit with my car is still around.
I wouldn’t say it is a panic attack. I’d say it is a normal response.
…natural immunity to shopaholism…
That’s me, but I have a different title for it. I call it “lacking the shopping gene” (and, being that I’m female, it seems to be a rare genetic mutation). I hate shopping. I only do it for necessity, I never just window shop or browse, etc. I’d rather spend my free time anywhere besides a store.
Amen, sister!
I have horrible memories of being dragged around shopping by my mother on Saturdays when I wanted to watch cartoons and read.
I utterly hate any kind of shopping and will put it off and put it off even for things I really need.
The only time I really bought a lot was when I worked at CVS. Big employee discount, plus I had first dibs on sales and clearance. I had a nice several years’ supply of household staples when I left there, sadly used up by now.
Like palmy, I love the thrift store. Generally happier with my purchases there than with Target et al.
Oh gawd,
Put me in that category also. I can’t stand shopping except when I’m in a bookstore or in the tool department of Sears.
When I take my mom shopping, who loves to browse, she knows when it’s time to go. She says I get this glazed panic look in my eyes.
There’s an extraordinarily simple solution to this. I’m surprised that y’all haven’t come up with it before.
Whenever I am forced to go shopping with people, I insist on three things:
(a) THEY buy me a large coffee,
(b) I bring my book, and
(c) THEY can go wherever they want, as long as I get to park my b*tt in one spot and read + imbibe coffee in peace.
It works like a charm, I assure you.
I’ve done the three you listed FPSS. Other times I go with mom, because she wants my opinion and my company. Of course that lasts only so long. When she starts hearing what ever makes you happy she knows it’s time to start heading for the door.
When I get dragged to stores where people want my opinion (such as it is), I insist they have comfortable chairs where I then proceed to park on, read and drink coffee in peace.
Periodically, the person doing the shopping comes by from the dressing room, interrupts to ask for proferred opinion, and then they go away. They can leave their “purchases” at my side which I will take care of.
Blanket flat-out refusal on stores that don’t have comfortable seats. Since I am not the one shopping, I am going nowhere. You can walk all over, and come by here if you want my opinion!
Fasty! No way! I do it that way, too! Except I bring my flask, filled with gin, to enhance my coffee or else to stand alone, and the book I bring with me must not be one I am really super excited about, because when I am disturbed whilst reading something I am really excited about it goes badly; I tend to bite first and apologize later, after I’ve been prodded out of the closet or the store rafters with a broom handle.
That can mar a friendship, as well as put a hole in a nice garment that I plan on wearing later.
But you probably know all this.
I am not a grudging opinion giver, however, not at all—I am alert! The whole reason I have consented to be the shopping companion, if I have, is that I am with a spendthrift friend who is either rich and/or credit-enhanced, and who (this is the important thing) happens to be my size and who tires of clothes easily. I have a few friends like this, and they are my dear, precious treasures.
You know what, I don’t think I spent any money on clothes last year, now that I think of it….
Well, I have grown un-crabby enough to look up from my book even if I’m super-excited about it. It’s OK - I have learnt to accept the vagaries of the universe.
Unfortunately, I have no friends that go shopping, are spendthrifts, who are my size, and tire of clothes easily. Someone fails on one of the four (usually the size and the spendthrift part.)
SIGH.
I also have an auxiliary rule - if you ask me my opinion, and frank and forward it will be, you can’t be p*ssed if it doesn’t agree with yours. Doesn’t always work but it’s worked far more often than not.
‘Unfortunately, I have no friends that go shopping… Someone fails on one of the four (usually the size and the spendthrift part.)’
Well, you’re a boy, and I presume you want to wear boy clothes? ( I more or less assume that, but if I’m incorrect, not that there’s ANYTHING WRONG with that.
Those particular circumstances (spendthrifty, shoppy, tire of stuff easily) are not limited only to girls, but they do seem to afflict girls quite a bit more, so I can see why you’re limited in your acquisitions and can’t be sneaky like me, that is, if you like wearing boy clothes.
But that’s okay, don’t be sad. *makes comforting and restful hand gestures, in a wafting-towards-Manhattan-through-the-ether kind of soothing way *
It really is how you wear it. I’m convinced of this. You can go ahead and wear your 15 year old flannel lumberjack overalls with the fluttering threads if you REALLY want to. You’ll look super!
Go on, it’s okay!…
WHERE’s my post? I mean, it was downright elegaic!
I hate shopping as well… in my case, it’s exacerbated by the fact that I am slightly disproportionate, but don’t look like it, so I look badly dressed with most clothes when in fact they’re just ill-fitting.
I shop at Ross when I can but they don’t often have the things that fit well. (When they do– oh yeah! I have a gray skirt that I LOVE and which I wore with a converter band through most of my pregnancy… and it cost me all of $12.)
I think the thing that bothers me the most about clothes shopping is that there is next to nothing that fits me in the usual inexpensive lines, so I have to purchase things which feel expensive to me. Like Eddie Bauer, which actually stocks Tall for women (which actually matters even in short-sleeved T-shirts.) I hate hate hate having to spend $30 or $40 on a T-shirt just so I don’t look as though it shrunk in the wash or that I’m showing my belly when I don’t mean to.
(mutters) women come in tall, women come in tall…
Palmy-
I’ve scored some of my best finds at JC Penney’s. Look for the red tag clearance items, especially at the end of the season.
I still have (and ocassionaly wear) a coat that I bought for $15 in 1990. It was marked down from about $100. Another score was a $40 pair of sneakers for $1.95.
Next time you find yourself in a JCP store with an oncoming panic attack, breathe deeply and say to yourself, “red tags, red tags, must find the red tags”.
See, Bubba? That’s how clueless I am. I didn’t know about the red tags.
Seriously, though, Penney’s seems to be big on massage tools from HomeMedics these days. I checked out one called a “Percussion Massager”. Geez, DO NOT try that one unless you want to destroy your spine. Good marketing, that. Use the percussion massager, then you’ll have to buy that chair thingie to sooth the aching back.
Yeah I bought a candelabra from JC Penney and got it home and part of it was bent. I went back to exchange it and looked through about 11 more boxes and everyone was bent. Junk from China thats what JC Penney sells.
Did you pass by a Victoria’s Secret store prior to entering Penny’s and that panic attack Palmy ?
ROTFLMAO!
Palmy:
Have i found the perfect answer to your “problem” seriously:
http://www.revbilly.com/index.php
“I have them and I’ll wear them, but I’ll never spend $300 on jeans again,” she said.”
Oh yes she will, and thanks to her and many others, we all will be paying that $300 for jeans, and a lot sooner than many think.
(come to think of it, that was one of my doomsday items to stock up on)
Have the “Real Housewives of Orange County” been impacted by the economic situation yet?
Doubtful, but I’ll let you know Tuesday night (guilty pleasure).
I have a few of my own guilty pleasures:
Parking Wars, Speeders, The Principal’s Office, Top Chef, Project Runway, The Amazing Race
Time for a title change, perhaps?
“Real Desperate Housewives of Orange County”
“Real Desperate Housewives of Orange County”
Edit:
“Real Desperate Husbands of Housewives of Orange County”
Nah, they’ll just divorce the current husband if he goes broke, ditch the child they had with him, then move on to the next lucky dog, have another throwaway kid with him, and then tell the cameras, whilst wearing a bikini with an extra-large margarita in one hand and a big diamond ring on the other, ” I just don’t know what’s wrong with Little Sonny Boy ! Juvenile court didn’t help him very much ! “
“Really Desperate Housewives of Real Desperate Husbands of Orange County” then?
What Does Treasury Bill - T-Bill Mean?
A short-term debt obligation backed by the U.S. government with a maturity of less than one year. T-bills are sold in denominations of $1,000 up to a maximum purchase of $5 million and commonly have maturities of one month (four weeks), three months (13 weeks) or six months (26 weeks). (Investopedia dot com)
Finance and economics
Economics focus
(Nearly) nothing to fear but fear itself
Jan 29th 2009
From The Economist print edition
In a guest article, Olivier Blanchard says that policymakers should focus on reducing uncertainty
CRISES feed uncertainty. And uncertainty affects behaviour, which feeds the crisis. Were a magic wand to remove uncertainty, the next few quarters would still be tough (some of the damage cannot be undone), but the crisis would largely go away.
…
It affects portfolio decisions. It has led to a dramatic shift away from risky assets to riskless assets, or at least assets perceived as riskless. It sometimes looks as if investors around the world only want to hold American Treasury bills.
“…policymakers should focus on reducing uncertainty…”
WTF? Will the nanny state now issue a teddy bear and comfy blanky to each Wall St. banker too?!?!?!
Haven’t they already? It’s called TARP.
It’s BARF- Bank Asset Restoration Fund
. 1 (Bloomberg) — Nobel laureate Joseph Stiglitz said any decision by President Barack Obama to establish a so-called bad bank to rid financial companies of toxic assets risks swelling the national debt.
That amounts to swapping taxpayers’ “cash for trash,” Stiglitz said yesterday in a panel discussion at the World Economic Forum in Davos, Switzerland. “You shouldn’t chase good money after bad. We’re talking about a national debt that’s very hard to manage.”
Stiglitz drew criticism from panel participant Angel Gurria, head of the Organization for Economic Cooperation and Development, who says a bad bank is necessary for lending to resume.
“I agree about the moral, ethical fallout, but you’ve got to face the music and someone has to take the loss,” said Gurria, Mexico’s former finance minister. “It’s the only way to jumpstart the economy.”
Hey Angel - F-U, you take the loss you P-O-S! The more I see the more I agree with the comparison of banks to organized crime. Take over the banks, wipe out the share holders, sell the assetts, pay off the FDIC insured accounts and then the rest of the accounts. If anything is left give it to the bond holders.
“I agree about the moral, ethical fallout, but you’ve got to face the music and someone has to take the loss,” said Gurria, Mexico’s former finance minister. “It’s the only way to jumpstart the economy.”
Is there a way to set up the Bad Bank south of the border?
He doesn’t really agree about “the moral, ethical fallout.” Please note he used the BUT after the phrase. Anything before the word BUT is a lie.
Banks aren’t lending because the people that need the debt can’t pay it back.
Taking bad assets off the banks does not make the people that want to borrow,any more likely to pay the money back!
How does taking the bad debt off the bank help the people that bought a house for 5x income and are now 50% upside-down?
How does it help the company that is struggling to make payroll because of their huge debt load?
How does it help a hedge fund that has overpaid for poorly run companies with huge legacy costs?
Taking bad debt off banks helps the stock and bond holders of those banks, BUT NO ONE ELSE! It will not get debt flowing again.
What about the other side of the coin?
Taking bad debt off the banks’ books leaves a residual of good banks. Good banks can trust eachother. Investors can trust the securities that good banks write.
The secondary markets opens up and money as well as credit begins to flow.. meaning credit-worthy businesses can borrow again.. and jobs can be saved.. and retirement plans and all the rest are more secure.
Good bank / bad bank is primarily about reestablishing trust among the market players, which ultimately stabilizes the job market.
Sure, banks could loan to each other, but good banks don’t need loans.
NO WAY would investors suddenly trust the securities written by good banks. The banks were “good” just a year or two ago, and the securities they were writing we pure garbage.
The securitization process to separate origination from risk is dead and is NEVER coming back.
Banks are stuck holding the loans they originate, so they suddenly care about actually getting paid back.
When banks care about getting paid back, they just aren’t going to loan into an economy where household debt is up 180% on 50% income increase, and business debt is up 250+% on falling revenues.
The game is over and it is not coming back.
Agree. To be a bit more blunt. The objective here, from our government, is to give (I mean loan) more money to deadbeats, so that they can go out and buy $300 designer jeans, as they did until just recently.
Good luck with that approach.
The people with good credit (most of us here at HBB, and several dozen others in the country) are EASILY able to borrow money when we want…but we’re not in any hurry to.
The banks were “good” just a year or two ago..
No way.. If banks were good in 2005 property valuation was accurate in 2005.
Ratings on bad securities may have been “good” up till a year or two ago, but banks have been making crap loans ever since the Bubble began.
Conspiracy theories aside, a “Good” bank has no conceivable reason to get back on the koolaid and continue along the path of self destruction…
“Conspiracy theories aside, a “Good” bank has no conceivable reason to get back on the koolaid and continue along the path of self destruction…”
So you are saying they won’t return to lending to people that can’t pay it back…. So we agree.
So, how does swapping their trash for cash help again?
Don’t forget that a bank can loan and make money (or break even) even if they don’t get paid back… just like in the olden days.
They do it with a healthy down payment and accurately valuated collateral.. like a house… something that can be foreclosed on and turned over at a profit. Those days are coming.
I posted somewhere around here that overpriced property is the root cause of our economic problems. Once prices finish correcting the rest of the economy will follow suit, imo. I also suggest that once RE hits bottom, govt intervention or stimulus will be detrimental to economic recovery.
“Good bank / bad bank is primarily about reestablishing trust among the market players, which ultimately stabilizes the job market.”
Let’s assume that they succeed in this endeavor and banks start lending between each other. The ultimate goal however is to make the banks lend to the proverbial US customer, not between bank. And the customer is insolvent, the same way the banks are insolvent at the moment. The government creates a bad bank to deal with the solvency of the banks, but this doesn’t do anything to about the insolvency of the US customer. What will the PTB do to solve this issue – crate BAD customer and transfer all the bad customer’s debt to him?
Sorry if this is a double post.
“Good bank / bad bank is primarily about reestablishing trust among the market players, which ultimately stabilizes the job market.”
Let’s assume that they succeed in this endeavor and banks start lending between each other. The ultimate goal however is to make the banks lend to the proverbial US customer, not between banks. And the customer is insolvent, the same way the banks are insolvent at the moment. The government creates a bad bank to deal with the solvency of the banks, but this doesn’t do anything to about the insolvency of the US customer. What will the PTB do to solve this issue – crate BAD customer and transfer all the bad customer’s debt to him?
Why conclude their ultimate goal is to get banks to lend to insolvent customers? That would be nutty, to put it mildly.
In any case, there’s no reason to beat this good bank/bad bank thing to death because, imo, bubbly property prices are the root cause of the economy’s trouble, and only when prices bottom out will stimulus efforts of any sort have some chance of success.
“Why conclude their ultimate goal is to get banks to lend to insolvent customers? That would be nutty, to put it mildly.”
Because the PTB want to mitigate/prevent the economy from getting into recession/depression and having in kind that the US economy is 70% consumer spending, the only way to “rescue” the economy is to get those customers spend. However the majority of the US customers are insolvent or at least buried already in too much debt. The PTB want the banks to keep lending to the US customer regardless of its ability to service the debt. Lending between bank themselves will do very little to save or create jobs and help the economic recovery.
having in kind = having in mind
You notice how volatile the stock market has been? Sure it’s in a downward trend, but even while major economic indicators deteriorate and crushing news stories follow each other like cars in a freight train, the dow might rocket up a few hundred points on any given day. How can that happen if everyone’s broke?
And how about CD’s and Treasuries, gold and cash? How much money was pulled out of equities, bonds, mutual funds and asset backed securities and into safe havens? Fact is that there are mountains of money now in hiding, waiting to be unleashed.
The idea that we’re all hopelessly in debt just doesn’t agree with reality.
Joey, if you think the fact that DOW rockets up every once in a while a few hundred points is a proof that the American consumer is not in big doo doo then you are mistaken big time. The markets do not go up or down in a straight line. A bear rally does not mean that the US costumer is in good shape.
Yes, there are mountains of money, but there are also mountains of debt. On a macro level - look at the savings rate.
The problem (IMHO) is even simpler then that. There’s simply almost nobody left that can actually take on more debt. It’s not an issue of the banks willingness to lend, it’s that the borrowers simply cannot take on more debt, and those that can simply don’t want any more debt.
There’s just not enough people who can possibly support more debt, that’s the fundamental problem.
5X income? Darrell, that would be a good loan in FL. I had an agent tell me (straight faced) that 10X was the new standard in our area (Palm Beach).
Well yes, somebody DOES have to take the loss. The question is, should it be who? At some level either it’s taken by those who decided to take on (or at least ignore) risks, or those with the greatest ability to pay.
The one than can afford the loss, but can’t afford a congressman, duh!!!!
Reminds me of an old joke.
A trust fund 30-something is told he needs to settle down and get married or he’ll be cut off from the trust fund. He has 3 girlfriends and decides to marry one of them. He gives them each $10K.
One runs out and spend the money on herself.
One takes time shooping and spend the money on him.
One splits the money, spending half on him and half on herself.
Which does he marry?
The one with the largest cup size…. duh!
I don’t think there’s any question. It’s the banks. Let them take it in the a**.
Well now, could things be getting a little (more) dicey south of the border as fewer money orders, and more people, are headed back down old Mexico way?
Not to mention the price of oil being so low.
The peso had gone down 40% in the past year compared to the US dollar in the past 6 months. So much for trade south of the border.
Did anyone see the Daily Show clip of Jon Stewart responding to Thain’s excuse that you have to pay these bonuses to retain talent? “I got news for ya, you don’t have any talent!”, or some such thing. The expression on Stewart’s face was priceless.
I feel increasingly certain that given the available choices, I voted for the right man for the job. Go Barack! Put the bankers on a pork reduction diet!!!
Financial Times
Obama wants tough conditions for banks
By Andrew Ward and Krishna Guha in Washington
Published: February 1 2009 14:18 | Last updated: February 1 2009 14:18
Barack Obama said he was committed to “doing what it takes to maintain the flow of credit” but made clear that additional support for the financial sector would come with tough conditions.
On Saturday in his weekly radio address, the US president outlined his plans to overhaul the government’s financial sector bail out fund as his economic team put the finishing touches on a sweeping package to shore up the banking system and help struggling homeowners.
that reminds me..
I think we need another law written into the stimulus package.. a law that limits how much taxpayer money govt can blow off on things like Presidential inaugural ceremonies… certainly something less than $100,000,000.00 a pop..
How about 50 bucks (added to whatever private money they can raise), or am I being too generous?
So far, I’m not too impressed. It’s one thing to do a publicity stunt like speak out against bonuses, it’s another to actually do the right thing.
The time to worry about bonuses for banks being propped up with taxpayer dollars was BEFORE they got the money.
Also, at the risk of sound like a broken record, punishing wall street while treating greedy homedebtors like poor victims isn’t fair solution either. No bailouts for banks OR homedebtors.
Before we blame Merrill for giving it to Thain, we should blame government for giving it to Merrill.. which was only possible because we gave it to government.
So, who’s ultimately to blame?
“…which was only possible because we gave it to government.”
We did? Voter approval of the CRAP plan must have been 20 percent or less…
Sorry, my hand slipped and I accidentally misspelled TARP…
LOL
Sure it did
I seem to recall all but a handful of Reps/Senators being re-elected after voting for it. If the voters were really upset, they could have voted for the other guy.
I’ve been wondering when the idea of a tax revolt was going to begin to grow. Why should we give the gov’t our money if they’re just going to keep lining the pockets of their banker cronies?
Of course, I’m going to chicken out and pay my taxes any way because I’m a gutless wonder.
He continued… How does that meeting go?
Hey Bob, you really messed up. You cost this company $1 billion and brought us to the edge of financial ruin…. I have to cut your bonus from $200 million to only $100 million.
Hey, Small Steps!
Hey Bob, you really messed up. You cost this company $1 billion and brought us to the edge of financial ruin…. We’ll hold you and your family hostage until you cough up all the bonuses we’ve ever paid you.
Rents falling in New York.
http://www.nytimes.com/2009/02/01/realestate/01cov.html?ref=nyregion
Even those who believe that price bubble can pop will be shocked about that one. And the way it works here is that when Manhattan rents soar, Manhattan wanna-bes surge into Brooklyn, and claim that’s what they wanted all along. But when Manhattan rents fall?
Here’s a money quote.
“Let’s hope this is a short-term problem,” said Vicki Been, the director of the Furman Center for Real Estate and Urban Policy of New York University. “You know, we prefer more affordable housing, until there’s a downturn. And then we panic.”
That IS the awesome quote!
They’re in free fall.
They are down about 25% in less than two months in my nabe on the UWS.
When I renegotiate this May, it’s gonna be VERY interesting.
That is amazing! I thought prices (including rents) always went up in the Manhattan vicinity, cause everyone wants to live there?
The desire to live in Manhattan may be infinite but the means to do so are decidedly not.
- FPSS
No, no. That’s San Francisco. Everyone wants to live HERE!
The way things are going, you’re going to be able to have a place in BOTH of them (NYC + SF) for the current price of one.
I like what you said FPSS
As you know, I cannot resist the temptation to quantify rates of change on an annualized basis. A two-month decline of 25% occurs at an annualized rate of ((1-0.25)^6-1)*100 = -82.2 percent.
Caveat: This is not a prediction, but merely a measure of how fast rents were recently falling, based on the assumption that FPSS’ figure is accurate. It seems unlikely that such a high rate of decline could be sustained for any length of time (although the Baltic Dry Index did manage to sustain a decline of 90 percent or so last year).
My guess is circa-2002 rents by the time I renegotiate.
Another 10-20% drop from here or so.
If they won’t take it, perhaps you should suggest you go month-to-month until the economy tanks to the point where they will take it
WT:
We still have Moron spendthifts $3215 a month???
You can get that for 1/2 here in sunnyside on the 7 like 8 stops from times square.
Only 1 reason to pay that kind of money …is if both your jobs are walking distance so you can each save $80 a month the metrocard, and work 14 hours a day and then walk home.
—————————————————–
Ms. Hsiao, 23, and her roommate, David Liu, 24, settled on a two-bedroom two-bathroom apartment in Midtown on the West Side. It was listed for $4,200. They offered $3,650 a month and were accepted. After one month free and a $2,000 signing bonus, the total came to $3,215 monthly, and they did not have to pay the broker’s fee.
“This apartment was definitely a great find and a bargain compared to 1.5 years ago,” Mr. Liu wrote in an e-mail message. “It’s definitely a renters’ market now.”
$3215 a month RENT…..that is completely insane.
well, not in the Netherlands …
they just started advertising for luxury apartments in a historic building that I was trying to buy eight years ago for my company. They hired a developer to the tune of 10.5 million euros, added loads of government money and it’s now split up in apartments with size between 50 and 130 square meters (that’s about 500-1300 sqft). The main selling point seems to be that the building has a private garden and meeting room that is exclusive to other renters, so you are assured of meeting people who also have too much money available.
Rental prices start at 4450 euros a month and if you think this is expensive, those are subsidized rents because some semi-gov organisation pays a huge part of the bill in order to keep it ‘affordable’.
No, this is not in the Amsterdam banking district, but in a small provincial town
yes, insane, but difficult to find anything in NYC that is reasonable, unless rent stabilized.
Even in unfashionable Queens studio apartments go for over $1000, 1 bedrooms $1300 or so. Without many anemities such as a laundry room, elevator or updated kitchens/baths.
For “the youngsters”, cramped roomate situations are the norm… know one who has two roomates in a one bedroom apartment.
Dude - I split a house that rents for $3500 in West Hollywood.
But..but…but…the trolls who still popped up in here as late as 2007 were telling us that rents could only go up, since foreclosed FBs would be flooding the rental market.
My counterargument was that millions of FBs would be moving back in with their parents, or would be forced to rent rooms in their homes to strangers; and that failed flippers and “investors” would further saturate the rental market as buyers failed to materialize for their overpriced houses.
I remember the one poster from Manhattan, who kept saying it wouldn’t happen in Manhattan or it would be small impact.
I remember more than one like that. They’re oddly silent as of late.
DAVOS, Switzerland – Here’s yet another danger from the global economic crisis. It could breed more corruption, as recession-starved officials increasingly demand bribes and hungry companies compete for shrinking resources.
Yet few words were dedicated to fighting graft at the World Economic Forum of business and political decision-makers last week. Instead, new financial rules, the U.S. stimulus plan and trade barriers dominated speeches and small talk.
“Corruption is a real cancer,” Kofi Annan, former U.N. secretary-general, said in a private meeting Saturday. “It deprives the poor from benefiting from some business activities or assistance,” and drains enormous amounts of money from the legitimate economy, he added
Wow we could see corruption increase. This dial goes up to 11.
When it comes to corruption, Kofi Annan knows what’s happening.
“When it comes to corruption, Kofi Annan knows what’s happening.”
Exactly, Kofi “oil-for-food” Annon and his scammer son!
I’m sure that in anglosaxon countries, the higher the (pay/work) level the more outrageous the corruption. If government and high profile business sectors like investment banking run out of money, that would probably reduce corruption problems instead of increasing them. The biggest criminals go where there is the most money.
example: the Dutch news just reported about a corruption scandal at a housing corporation (there are probably many of them still to be discovered). These are semi-gov organisations that control the rental housing stock, and where the managers used to have something like 3500 euros in month in income, at most. They were privatized and the managers now make 15-40K euros a month. These organisations control huge amounts of money (often many billions) and oversight is close to zero. Result: rampant corruption, the managers can steal millions without anyone taking notice (or caring about it …).
Here’s another NY Times article on the cultural effects of the downturn.
http://www.nytimes.com/2009/02/01/business/01view.html
“But this downturn will likely mean a more prudent generation to come. That is implied by the work of two professors, Ulrike Malmendier of the University of California, Berkeley, and Stefan Nagel of the Stanford Business School, in a 2007 paper, “Depression Babies: Do Macroeconomic Experiences Affect Risk-Taking?”
“A generation that grows up in a period of low stock returns is likely to take an unusually cautious approach to investing, even decades later, the paper found. Similarly, a generation that grows up with high inflation will be more cautious about buying bonds decades later.”
As someone who came of age in the late 1970s, do I have an irrational fear of bonds? I must say that it’s cash or stock for me, today mostly cash.
“A generation tha grows up in a period of low stock returns is likely to take an unusually cautious approach to investing, even decades later, the paper found.”
It took two professors to arrive at this astounding conclusion?
Lol.
Wait until the generation that sees housing prices fall broadly gets old enough to buy themselves.
Oops, hit send by mistake. When the NAR sees this I’ll need witness protection.
Since it’s the NAR, wouldn’t you need “witless” protection instead?
Already happening.
I heard a friend’s mom b*tch (who’s a realtor, of course) “how young people don’t think renting is bad if it’s cheaper.”
What a whole generation of ding-dongs!
This is going to have a HUGE cultural impact for the next 50-100 years. That’s why I can say with absolute certainty, this bubble is NEVER coming back in any of our lives. People will never forget the disaster that the housing bubble caused; it’s going to be in the history books as one of the worst financial events in history.
The NAR is on it’s last legs; 10 years from now they will be a nearly defunct organization. The RE agent is going the way of the travel agent (and all the other jobs totally removed by the Internet); it’s just a matter of when (and, because of what these greedy b*st(rds did during the bubble, it will be sooner rather then later).
I disagree about realtors going away. I think they’ll be around in their current form, more or less, in 10 years. Sure, there will be fewer of them than during the height, but they will maintain the role they have played since…whenever they came to be.
Remove state licensing and perhaps the modern realtor would go the way of the dodo but as long as they are provided legitimacy via the state, they’ll be here.
It absolutely amazes me that it’s usually our tax dollars that pay for these useless studies and no one says a word. Just like we say nothing when college tuition goes to $ 40,000/yr. Waste is waste, and there’s an awful lot of it in higher education. Would it really surprise anyone if there was a university study on ‘why people get depressed when they lose half their life savings’?
Kirisdad,
My thoughts exactly.
If? Google it and prepare to be shocked.
Trying to be constructive, part 2.
Social Security Tax:
This is the most unfair, regressive tax that creates a huge marginal rate bubble for people who make $75K-ish to $102K.
And why is it as it is? In 1936 it was created as a “pay in, get back” system with solid actuary rates. (Could only buy government debt, so assumed government would be able to run a surplus at some future time to pay it back.) People already retired? You get nothing. People that work just a few years, you get basically nothing. People that didn’t work like housewives, you get nothing. Die before you reach retirement age? Your money is used to pay for the people that manage to live long lives.
But, by 1939 people realized that what they were going to get was tiny. (They seemed to ignore that what they were paying in was also tiny.) So, government “fixed it”. They let people collect monthly payments, even if they hadn’t paid in long enough. They greatly increased the payouts. They established survivor benefits so minor children and spouses of people that paid in but died, could get some of the money back.
In effect, they transformed a sound income insurance program into a Ponzi. Okay,we can argue over what is and what is not a Ponzi, but in my opinion, Social Security ABSOLUELY counts. When money is taken from my paycheck and then matched by my employer, the vast majority of that money is instantly handed out to people my grandparents and parents ages. The rest is handed to government who immediately spends it. But, despite being used to pay out past “participants”, it is also credited into my account.
The problem is, it is pay-go, but we pretend it is pay-in.
Well, in my opinion, it is time to blow off the pretense that it is pay-in.
Get rid of the Social Security tax, and just roll it into income tax. Increase all marginal rates by… oh… 10% or whatever it takes. Then dump a bunch of the credits like earned income and child that are designed to pay people back for their payroll taxes.
Tax simplification, tax fairness, AND intellectual honesty that Social Security is a pay-go system.
Oh, and it also makes it much easier to do what really needs done. Flatten the payouts. Make Social Security checks a flat amount for all recipients instead of handing larger checks to those that SHOULD need them the least because they had higher income in their working years.
Then we admit that most pensions can’t really be paid, especially government pensions. Stop trying to pay those and the vast majority of budget problems for state and local governments just go away.
Just as I’d like to see national health care be true insurance with a deductible set high enough so 95% of people won’t need to file a claim in any given year, I’d like to see social security be similar insurance against “living too long”. This way, a prudent person can plan ahead as if he’s living to the average life expectancy, and if he exceeds that he’ll get government support.
It would encourage seniors to spend, because they don’t have to worry about “what if I live to be 99″ and wouldn’t be that expensive.
I think that is already the plan in a few years when Social Security starts paying out more than it takes in. The difference will be made up with income tax.
This crisis has served to elevate Soros’ credibility. Not sure his ideas will ever gain traction in academia, however, as many academics live inside an Ivory Tower bubble which insulates them from the need to test their theoretical constructs against the real world.
BTW, if you review the August 2007 dialogue on this blog, you will discover that some posters here also detected the onset of a global financial panic at that time.
Financial Times
The credit crunch according to Soros
By Chrystia Freeland
Published: January 30 2009 11:38 | Last updated: January 30 2009 11:38
On Friday, August 17 2007, 21 of Wall Street’s most influential investors met for lunch at George Soros’s Southampton estate on the eastern end of Long Island. The first tremors of what would become the global credit crunch had rippled out a week or so earlier, when the French bank BNP Paribas froze withdrawals from three of its funds, and in response, central bankers made a huge injection of liquidity into the money markets in an effort to keep the world’s banks lending to one another.
…
The discussion focused on a single question: was a recession looming? We all know the answer today, but the consensus that overcast afternoon was different. In a memo written after the lunch, Wien, a longtime friend of Soros’s, wrote: “The conclusion was that we were probably in an economic slowdown and a correction in the market, but we were not about to begin a recession or a bear market.” Only two men dissented. One of those was Soros, who finished the meal convinced that the global financial crisis he had been predicting – prematurely – for years had finally begun.
…
Soros’s experiences in 1944 laid the groundwork for the conceptual framework he would spend the rest of his life elaborating and which, he believes, has found its validation in the events of 2008. His core idea is “reflexivity”, which he defines as a “two-way feedback loop, between the participants’ views and the actual state of affairs. People base their decisions not on the actual situation that confronts them, but on their perception or interpretation of the situation. Their decisions make an impact on the situation and changes in the situation are liable to change their perceptions.”
It is, at its root, a case for frequent re-examination of one’s assumptions about the world and for a readiness to spot and exploit moments of cataclysmic change – those times when our perceptions of events and events themselves are likely to interact most fiercely. It is also at odds with the rational expectations economic school, which has been the prevailing orthodoxy in recent decades. That approach assumed that economic players – from people buying homes to bankers buying subprime mortgages for their portfolios – were rational actors making, in aggregate, the best choices for themselves and that free markets were effective mechanisms for balancing supply and demand, setting prices correctly and tending towards equilibrium.
The rational expectations theory has taken a beating over the past 18 months: its intellectual nadir was probably October 23 2008, when Alan Greenspan, the former Federal Reserve chairman, admitted to Congress that there was “a flaw in the model”. Soros argues that the “market fundamentalism” of Greenspan and his ilk, especially their assumption that “financial markets are self-correcting”, was an important cause of the current crisis. It befuddled policy-makers and was the intellectual basis for the “various synthetic instruments and valuation models” which contributed mightily to the crash.
By contrast, Soros sees the current crisis as a real-life illustration of reflexivity. Markets did not reflect an objective “truth”. Rather, the beliefs of market participants – that house prices would always rise, that an arcane financial instrument based on a subprime mortgage really could merit a triple-A rating – created a new reality. Ultimately, that “super-bubble” was unsustainable, hence the credit crunch of 2007 and the recession and financial crisis of 2008 and beyond.
“Rather, the beliefs of market participants…”
Conclusion: Many market participants are dumb as rocks.
Wrong…. Humans, even smart ones, have an inate ability to believe that which, if true, would greatly benefit them.
This is the bases of religion, political parties, scams, marketing (oops, those are the same, aren’t they?), nationalism, racism, faith, etc.
I think faith is a major character flaw. We should spend much of a person’s early life trying to teach them how NOT to have faith. Instead, we spend that time teaching them TO have faith.
“” nationalism, racism, faith, etc.”"
Or with Globalism, anti-racism and any number of issues, planks or positions. The MSM, Hollywood and Uncle Sam learned a long time ago that emotive manipulation is by far the more effective control.
Darrel
Best post I’ve read all year.
Wrong…. Humans, even smart ones, have an inate ability to believe that which, if true, would greatly benefit them.
Especially within groups,and in front of authority figures. If everyone in the group, or on the TV believes it it must be true. If my minister, financial advisor, politician, ect believe it it must be true.
“People base their decisions not on the actual situation that confronts them, but on their perception or interpretion of the situation.”
Many people don’t even bother to go that far. They don’t bother to analyze what is occuring right before their eyes, rather they wait for some “authority” to interpret events for them.
Jas is right…
Yes, but if you wrote an “academic” paper “proving” that “most people are m*rons”, who would actually finance you?
if you wrote an “academic” paper “proving” that “most people are m*rons”, who would actually finance you? M*rons?
I think in the case of most people it is little other than the “common sense” of dollar cost averaging, stocks always go up, real estate always goes up, save 5% of your income and you’ll be able to retire…
They don’t go into the details, just the basic high-level beliefs.
Yeah, they never go into those details.
They never examine why something might even remotely be plausible or implausible.
FL homes selling at 50/sq/ft in Port St. Lucie/Martin County:
http://www.palmbeachpost.com/business/content/business/epaper/2009/01/31/0131_pslhousing.html
Down 50% from the peak. And still has quite a bit further to fall. Think that any of the really bubbly areas will get to 75% down? I never would have thought so, but now I’m beginning to wonder. I saw the housing bubble, but not the ensuing disaster at the banks, the credit cards, and in general how over leveraged the entire country is. 50% down was the intrinsic correction necessary to get homes back where they belonged. Anything extra will be a result of the shock wave from falling home prices.
Same here, kinda of. Saw the housing & consumption/CC bubble (HELOC extraction) from a mile away, completely underestimated the impact on banks in general and the rest of the world, even countries that have huge surpluses.
Guess we are no Roubini.
Oh well cougar, it could be worse, I lost some $$$ in the stock market betting the wrong way on the banks. But nothing like I would have lost had I misread the housing bubble. I’d be down at least 200K had I bought the place I currently rent, with no hope of it ever coming back and paying about 2X what I currently do to rent. That would be a disaster. Losing a few K from bad bets on the banks isn’t exactly pleasant but that was fun-money anyway, I knew it was a huge risk; speculated and lost. Perhaps I can get my bailout now?
That’s the thing that angers me so much about the housing bubble. Many (most?) of the people involved were just speculating, and were using 100’s of thousands of borrowed money to do it. Now that it’s gone bad, why on earth should they get a bailout; they were speculating FAR more recklessly then I was (trading with 100% equity and with about 3% of my yearly income for fun). These people were using 100% LEVERAGE and 10X their yearly incomes to speculate. That’s terribly irresponsible, bailing them out is simply not the way to deal with this situation. Let them take their lumps and move on (just like I am/did). If they can’t afford it, that’s what BK is for!
“50% down was the intrinsic correction necessary to get homes back where they belonged. Anything extra will be a result of the shock wave from falling home prices.”
–
Nope, totally wrong.
South Florida is down around 40% from peak per Case_Schiller.
At 169 in Nov 08 from the peak high of 280 in late 07.
Yes, in Miami it was late 07 when last peak occurred.
But this misses the point. That’s 40% down from peak.
Real question is when did bubble start. If you say it started in 2000, then you have another +35%+- to go from today.
Prices went up more than double in many areas (triple in Miami)
50% just doesn’t cut it.
PSL and Martin Counties are kind of the beginning of south Florida and so weather is almost as good as Miami in the winter. I agree that housing prices are likely nearing a bottom here because there is a large pool of people who draw a moderate income without working, and this is one of the more pleasant places not to work.
Sign of the times: The median MLS-listed home in our zip code is a foreclosure home, listed to sell at a bubble-era price…
16834 STAGECOACH PASS, SD - Rancho Bernardo, CA 92127** Foreclosure
Beds: 3 Type: SFR Sq. Ft.: 4,018 Lot Size: 15,682 Sq. Ft. MLS #: 090005603
Baths: 3/1 Built: 2006 $/Sq.Ft.: $299 List Date: 01/27/09 On Market: 5 days
List Price: $1,199,777
Estimated Monthly Payment: $7,982
ZipRealty will give you up to $7,198 cash back.*
Description
Amazing bank owned opportunity in one of the most luxurious and exclusive communities in san diego county. Great floorplan with 2 beds, 2 full baths upstairs with loft landing and built-ins. Huge great room with chefs kitchen. Outside is a blank slate wai ting for your magic touch. Granite and other high end materials throughout. 24 hour guard gated community for ultimae privacy. Must see!!!
Estimated Monthly Payment: $7,982…On Market: 5 days
No… WaMu/Wachovia/Citi China made lead hand-painted St Joseph?
How many people can fork out $8K per month?
Not counting you know pesky things like food, and oh, a life instead of feeding the housing meter.
you’ve obviously never picked strawberries for a living.
Picked strawberries? Yes.
For a living? No.
My parents used to own a vacation home where they grew strawberries. I picked them.
In theory, I would like to grow my own tomatoes. In practice, it’s just easier to go to the farmers’ market. One must have a realistic assessment of where ambition transitions into an outright fiasco.
I had strawberry plants (and a big garden including a peach tree that gave 100x the number of peaches we could realistically eat).
Unfortunatly, I never got to pick the strawberries because the plague infested, bushy tailed rats (some call them squirrels) would eat them all.
why not eat the squirrels then?
Nobody Expects the Squirrel Inquisition.
‘why not eat the squirrels then?’
‘Cause they taste good, but not THAT good, especially considering all the fiddley bits and assorted pink tubes you have to effortfully sort through first, before you get to the eatin’ part, is why.
It’s a whole bunch of effort for a little piddley bit of meat, is what I meant. Besides, nothing looks sadder than a dead squirrel. Just give’um the strawberries and go to Costco, buy yourself a big bunch of large red pretty strawberries picked by 8-year old Guatemalan forced-labor kids, I urge you.
Hmm…I like squirrel. Its not a whole lotta meat, thats true. But you can make it up on volume.
Oh. Well, then, I am corrected.
‘My parents used to own a vacation home where they grew strawberries. I picked them.’
Tell us about your strawberry picking, fasty. How many did you eat? Did you get a sunburn? Did you dig in the mud?
“On Market: 5 days”
Omitted detail: How many times they relisted it over the past several years…
Once upon a time people bought a house to live in. Kitchens needed cupboards and counter space. You needed a yard for the kids to play in. The family room was for TV watching and such.
We had a formal living room, which was only used when my parents had company over.
Over the years, the WHOLE main living space was redesigned around this relatively rare “when people come over”. We needed an open floor plan for when we’re hosting a large party. The yard has a fire pit and water features to impress people when they come over. The home theater, to impress people when they come over.
At what time did we stop buying a house to live in, and start basing our purchasing decisions on how well it would impress others when they came to visit?
Firstly, there is nothing wrong with this. As societies grow more affluent, more of our income is necessarily funneled into discretionary stuff. Only if you believe in “hairshirts for everybody” is this really a problem.
Secondly, “aspirational lifestyles” have always been with us. It was as true in the 2nd century as the 10th as it is now. Possibly, the marketing wasn’t as onerous but it’s been with us.
What are you possibly objecting to is that people bought the lifestyle without the means to do so which pretty much gets into how the debt was sold.
I like some of these designs. Having stayed at a friend’s place for a few weeks once, I can assure you they are quite enjoyable. Of course, the afore-mentioned friend bought it in cash so …
I do not object to aspiring to a better life. I object to doing so for the purpose of impressing others.
Intentions, I will have you know, are notoriously hard to judge.
If I crave such a place, am I doing it because I like it, or because I want to impress someone? Maybe its’ 20-80, or even 90-10. Most likely, I don’t even know the answer myself.
How do you decide? The simple answer is that you can’t.
Years ago, a famous artist made an observation that for a lot of people (but not all), they first go to the opera or the symphony to impress their peers. Sooner, if they are willing to be receptive, they learn to enjoy it, and some even become passionate about it.
That’s how ALL connoisseurship works.
I’m a connoiseur of chocolate chip cookies… and Disneyland…
I never started with the intention of impressing anyone.
Some might argue that there’s nothing there worth impressin’ anyone about.
Jes’ sayin’.
Having gone inside a hundred or so of these houses with the “formal” living room, and “formal” dinning room (one on each side as you enter) I have to say that Darrell has a point.
These people have NO taste.
–
As to who am I to judge what constitutes “taste?”
Well, that’s something you either have or you don’t, and in all honesty, a lot of folks do not.
–
(I actually saw 2 story McMansions with the rear windows overlooking a County cemetery which was just across their fence.)
I like the 3-story ones around here with the backyard and windows overlooking the interstate. Having grown up on a lot which was between a lake ( the reason why my parents bought it ) and the service drive for a major interstate, which had a 700-foot driveway, you could still hear the darned semis rumbling down the highway at night, and the constant swoosh-swoosh of the traffic was always in the background. I can only imagine trying to get the baby to sleep in the top story of the McMansion with the nursury windows overlooking the highway. Experience definitely worth $ 4500 a month mortgage payment. Yes.
‘…with the rear windows overlooking a County cemetery which was just across their fence.)’
But I like cemeteries! Nice and restful. I especially like very old cemeteries, crumbling away, in ghost towns, where you can hear the wind blow on and on, unimpeded, and it sounds like the sound of ‘forever’. Is this what you mean by the ‘taste’ thingie?
Man, I wish I was at the Eureka, UT cemetery right this very minute! It’d be cold, like here, but crisp, unlike here, and the breath would come steaming out my nose. Then I could see how those white headstones were weathering. That was a good cemetery. That IS a good cemetery. I have some grandpas in there, but I never could find their stones, as they were too faded by the time I entered the scene.
Too bad, huh?
I’ll take the cemetery vs. a busy street any day.
Living in the limelight is the universal dream for those who wish to seem. Style over substance, form over function, artificial over real.
even in nature this is common, e.g. birds building a bigger/nicer nest to impress the females
‘Firstly, there is nothing wrong with this. As societies grow more affluent, more of our income is necessarily funneled into discretionary stuff. Only if you believe in “hairshirts for everybody” is this really a problem.’
I have to disagree.
I don’t believe in hairshirts for everybody, but I do believe in good design. A lot of the newer houses were NOT well designed for the people who would/will be living in them. We’re all the time talking on here about why the Hell would aging boomers need a buncha stairs, for instance. And I just had dinner at a friends house the other day–your typical McMansion— and it’s just like Darrell says–it was built to ‘impress’. Big ol’ vaulted ceiling, marble mantlepiece, blah blah, well JEEZE! It was COLD! And echoey, sort of. They have two rooms off their entry way that get used about once a year when they entertain more than one or two people. Stupid design. A real waste of money and resources.
I have a little, very simple house and when I entertain, which I often do, everyone gathers around the woodstove and the kitchen, because that’s where the food, light, laughing and talking is. Then if I have a lot of people over I open up the glass doors leading onto the back deck, set up tables and comfy chairs and the deck becomes the party place, under the giant dark trees, with shining Japanese lanterns glowing like interested moons in the night sky. Never, ever, even once have I thought, ‘Oh, if only I had giant vaulted ceilings, a marble mantlepiece, and a Zen water fountain.’
Bad design and wastefulness makes me crazy.
You’re not going to hear an argument from me about “bad design” or “wastefulness”. In fact, you’re not going to hear an argument from me about anything what you’re talking about.
I’m with you.
I’ve been inside a McMansion once, count ‘em, once in my entire life. So I guess I don’t have a clue about how the “other half” lives.
Even the place I was talking about was no McMansion. It was actually a large, well-designed condo on the outskirts of Chicago.
Olygirl,
Just curious. The trees off the back deck — what kind are they? Big conifers or stumpy hardwoods?
I’m trying to get a visual here. You gave me part of the picture and now I need the rest. And yes, I’m fascinated with trees…
Oh, my! Trees! * big happy sigh *
Trees, trees, trees…goodness! Trees is where it’s at! Great big firs, big Western Hemlocks with their droopy looped limbs of descending green scribbley-type foliage, relatively little patched-together alders, and right near to me, two giant maples, very old and big—they couldn’t be reached for logging, because they are perched inconveniently in a soggy ravine. That spared them. (Thank you, Jeebus.)
The firs and maples vary from about 90 feet to 100+ or more. They’ll really haul your eyes up to the sky!
Of course, this is the ‘Daytime Trees’. As we know, us who walk around in the dark, the ‘Nightime Trees’, that come out after the sun goes away are much bigger. And a lot, well…you know…darker and all. Plus they move, if they want to.
Those nighttime trees….
Do you play old The Who albums so they will be attracted by the “Entwhistle”?
‘Do you play old The Who albums so they will be attracted by the “Entwhistle”?’
I am sorry to admit I don’t know the “Entwhistle’ song. But on the other hand, I don’t know if I need to. The trees around here are entirely too wakeful and full of advice and stuff already. Jeeze, about got to race them to the mailbox, even.
Invite me!!
Heckfire, yes! You’re invited!
Say, Muir, how’s your interpretive dancing skills? Good, are they? I suspect so.
One thing I always wish I had more of at my parties is a really good interpretive dancer…
Hmmmm…..
when we see the US blurbs on TV over here (today some from FL) I’m always impressed with the extremely bad taste that shows from these McMansions. I won’t consider most of the Dutch suburbs good design for a moment, but they do look nice and sensible compared to most of what I see from the US …
I do see excellent home designs from the US from time to time, but that seems to be the exception to the rule.
You’re impression are right on.
One of the worst aspects of this bubble was the kind of housing built to maximize builder profits.
These McMansions that blanket our country are very poorly designed and sit on tiny lots where everyone is staring at each other through the windows.
An example would be the house PB mentioned above: over 4,000 sf, but only 3 bedrooms???? These homes are full of huge hallways and expansive foyers, but they’ll often have very tiny living and family rooms, and the rooms are often separated from each other, so there is no proper flow.
One thing for sure in the U.S., housing construction has NOT imoproved over the years; quite the opposite, unfortunately.
Daffy: “That’s Desssssspicabllllllllllllle!
I guess I’m lucky. Sold Las Vegas condo in April 2006 at bubble peak. Sold Alexandria, VA house in March 2007 at just 10% off bubble peak. Retired in Sept 2007, and got 401k money out. Rolled it over into long-term FDIC-insured CDs at rates averaging 5.25%. Sorry, Wall Street!
My Dad grew up in the Depression. He always told me never to gamble with my retirement money. So I didn’t.
Only made one little mistake. Bought a condo in FL Panhandle for 70K at end of 2007, which was 30% off bubble peak. Should have held out for 50% off bubble peak. Oh well. At least I’m not living on the streets.
Interesting op-ed on not trusting T. Boone Pickens:
http://www.hcn.org/wotr/don2019t-trust-this-texas-billionaire
The Pickens plan is to use natural gas instead of oil to run cars. I wouldn’t expect environmentalists and global warming believers to back his plan.
Personally, if we want to become energy independant, I think the Picken’s plan is the most realistic thing out there.
if we want to become energy independant, the only way is to become Amish.
That defeatist attitude is weak azz and sort of un-American! Not flag waving here. It’s just that innovation is what we do (did) best, with a “can-do” spirit. What the heck happened? We put people on the Moon! As an old friend used to say, “PCBH”. As in Wussies Can’t Be Heroes.
The Picken’s plan seems sketchy and self-serving. It’s like Donald Trump saying a few years ago that it was a good time to buy RE. That’s because he had (has) a lot of RE to sell. T. Boone has a lot of natty gas to sell as well. Just have to look at the plan with a grain of salt.
MrBubble
Crashing the other oil producers NOW lets them spend their excessive youth population in fruitless wars against themselves. Before they can last gasp a few nukes.
Call it the Venezuela strategy.
No wait, that’s already taken as the “Steal it then ask for help running it” strategy.
Many taxis in Colombia run on natural gas. The “tank” is in the engine compartment and everyone must exit when fueling. (Colombia produces some oil but has little in the way of refineries. Natural gas from production to use apparently involves many fewer steps.) Gasoline is about $3/gallon -very expensive for a poor country. NG is about $2. BTW, taxi drivers are lucky to make $15 in a 15-hour day. But, like VirginiaTechDan said the other day - there are lots of families out there making under $10/day and getting by and staying upbeat - I can attest to it.
must….resist…retort…..cant do it.
Whats the plan Losty?
We gonna run the Energy policy with Guido the sandwhich artist from Subway, Shayteqwa the nail salon princess…how about Pimple faced Johnny the famous Starbucks Barista….
How bout we all just send our money to Prince Ala-Weed so he and Putin can ski in the UAE?
What’s wrong with Prince Ala-walla-willa-wonka-weed?
Without him, the taxpayer would’ve had to spend even more money bailing out $hittibank. You should be thanking him.
http://www.larouchepub.com/other/2008/3533windmills_for_suckers.html
Windmills for Suckers: The T. Boone Pickens Plan
NYT
01/30/2009
A Month Free? Rents Are Falling Fast
IN this painful economic climate of layoffs and shrinking investments, there is a sliver of positive news: it’s a good time to be a renter in New York City. Prices are falling, primarily in Manhattan, and concessions like a month of free rent are widespread.
Although it is notoriously difficult to quantify the state of the rental market, rents fell in almost every sector of the Manhattan market last year, according to the Real Estate Group, a New York brokerage. The steepest drop was in one-bedrooms, down 5.7 percent in buildings with doormen and 6.53 percent in buildings without. The only category that rose: rents for two-bedroom apartments in doorman buildings, up just a bit, by 0.61 percent. But these numbers, like most available data, represent asking rents rather than the final price. Anecdotal evidence suggests that some people are negotiating rents as much as 20 percent lower than the original prices asked by landlords. These figures also leave out incentives, like a month of free rent or a landlord’s paying the broker fee, which can add up to real savings.
“Rents are falling so it’s a good time to be a renter in NYC.”
Rents are high in NYC because people get a lot of “utility” out of living in NYC. Rents are falling precisely because there is declining utility to living in NYC - higher taxes, poorer job and career enhancement prospects, greater fear, fewer interesting people to interact with, etc.
This whole utility/marginal utility theory is less than useless.
It’s a post-facto explanation that can predict absolutely nothing, and can justify any price for anything independent of fundamental factors like income, rent, etc.
OK, then call it whatever you want. Who’s trying to predict? I’m just pointing out that saying falling rents means it’s a great time to be a renter is a flawed way of thinking, and I think the point was made.
New York is just as desirable now as it was ten years ago, or even in 1950 or 1900 or 1850.
Same can be said for San Francisco. The bay was just as beautiful then and the weather was just as perfect as it is now. In fact, nothing much happened in the last eight years to make any of these places more or less desirable than they already were.
So even if you’re not “predicting”, your “explanation” is complete hoo-ey.
In fact, rents tracked incomes and house prices soared well above both rents and incomes. Now, rents are tracking the newly fallen incomes, and home prices will be driven into the same gravitational orbit.
And yes, it is a great time to be a renter pretty much anywhere in the US (and that includes both Manhattan and San Francisco.)
The WSJ has thrown down the gauntlet:
Preventing foreclosures has become a top priority of politicians, economists and regulators. In fact, allowing foreclosures to happen has merit as a free-market solution to the crisis.
If the intent is to help homeowners, then foreclosure is undoubtedly the best solution. Household balance sheets have been destroyed by taking on too much debt via the purchase of inflated assets. With so little savings, a household with negative equity almost implies negative net worth. Walking away from the mortgage immediately repairs the balance sheet.
Credit may be damaged, but homeowners can rebuild it. And by renting something they can afford, instead of the McMansion they cannot, homeowners are most likely to have some money left over each month that they can save toward a down payment on a house they can eventually afford.
Finally, loan modification is not only ineffective, it is evil. Coercing borrowers to continue paying a mortgage on a home that is hopelessly overvalued and not informing them of alternatives is predatory lending.
The media should interview those who had been foreclosed upon. Do they feel sorry or relieved? Are they rebuilding their credit, not to mention their lives? Do they miss the pressure of having to make payments they cannot afford on a McMansion that belongs to the lender?
The intent of modification programs to date is to create a generation of mortgage slaves. Fortunately, mortgage slaves can free themselves via foreclosure, and the masses are choosing to do so.
This is gonna go mainstream, and then the financial system is gonna go “nucular”.
BWAAHAHHAHAHHAHAHHAHAHHAHAHHAHHHHHHHHHHHHHH!!!
gonna go mainstream Kinda doubt it, it’s so un-American to embrace common sense like that. We’re more likely to invade Mexico.
We shall see. It went mainstream between 1992-1994 too but maybe this time something “magical” will happen.
You need to talk to people in AZ. It is already mainstream here. People aren’t walking away from debt. They are running.
It isn’t an matter of it…. It is just a matter of timing it correctly to ensure you get maximum advantage.
“isn’t a matter of it”
Should be
ins’t a matter of if
“If the intent is to help homeowners, then foreclosure is undoubtedly the best solution. Household balance sheets have been destroyed by taking on too much debt via the purchase of inflated assets. With so little savings, a household with negative equity almost implies negative net worth. Walking away from the mortgage immediately repairs the balance sheet.”
Would anyone from the OBwan economics dream team care to offer comment?
You’re my only hope, OBwan!
Now, why do I feel the need for exactly TWO cinnamon buns?
Wall Street Journal to America’s “home” builders: “We concur with Hwy50, why aren’t you guys @ <$1.00 USD per share?”
“Credit may be damaged, but homeowners can rebuild it. And by renting something they can afford, instead of the McMansion they cannot, homeowners are most likely to have some money left over each month that they can save toward a down payment on a house they can eventually afford.”
Next week’s WSJ exclusive will be on “Reverse Mortgages … for those over age 90!
“Finally, loan modification is not only ineffective, it is evil. Coercing borrowers to continue paying a mortgage on a home that is hopelessly overvalued and not informing them of alternatives is predatory lending.”
Has the Fed morphed into the predatory lender of last retort?
Fed has morphed into the World’s Largest Auto-Dealership of Last Resort™!!!
Tune in, professor!
Just autos? I thought for sure they had branched out into other segments of the pawn shop industry?
I have a question for DJ.
tonsopaws@hotmail.com
that is New York dj
AP Investigation: Banks sought foreign workers
SANTA CLARA, Calif. – Major U.S. banks sought government permission to bring thousands of foreign workers into the country for high-paying jobs even as the system was melting down last year and Americans were getting laid off, according to an Associated Press review of visa applications.
The dozen banks now receiving the biggest rescue packages, totaling more than $150 billion, requested visas for more than 21,800 foreign workers over the past six years for positions that included senior vice presidents, corporate lawyers, junior investment analysts and human resources specialists. The average annual salary for those jobs was $90,721, nearly twice the median income for all American households.
Banks sought foreign workers Just doing the work Americans won’t do, the onerous job of wrecking the world.
Americans won’t do that job for less than $10 million annual bonus.
See KOB dot COM and Albuquerque Journal web sites. P. B-1 ABQ Journal, 2/1/09: “Man Dies in Otero Standoff… LAS CRUCES — One man died and a woman was taken into custody after a 16-hour standoff with more than 100 police officers that began when Otero County deputies tried to evict the couple from their La Luz home.” 14 deputies rolled up about 1130 on Friday to serve an eviction order and came under fire before they got to the door. One neighbor/witness was a retired MI state cop who said he saw a man hiding under vehicles in the driveway, who fired dozens of shots at police in 3 sustained barrages. There was a woman holed up in the house talking to a police negotiator on the phone & giving him misleading info. The gunfire died down & eventually they sent a SWAT robot into the home to put cuffs on the woman & take her away. There was a man dead of a single GSW in the driveway, no word yet on how he died. The story made me wonder why the officers didn’t show up in an armored vehicle in the first place. I guess the news coverage would have looked bad had they showed up with overwhelming force.
Some neighbors were interviewed on local TV. They said the suspects had repeatedly menaced them, threatened to kill them and/or blow up the neighborhood, and this too place long before the place was sold in a foreclosure auction Aug 2008. Over the years they sued dozens of people for violating their rights, no word on whether any of their lawsuits amounted to anything. The couple in question had bought the property 4 years earlier. The media didn’t say how long the foreclosure process took.
Ah, the next stone to drop on local government budgets. Standoff overtime and SWAT robot decontamination.
CRAAAAAAAAAAA - ZEEEEEEEEEEEE.
Banks aren’t lending because they cannot profitably sell newly made loans. They cannot sell the loans profitably because asset prices are still falling. As a result, new loans have to be kept on the balance sheet, which reduces available lending capital, or sold at lost, which reduces asset prices on the balance sheet.
Not only are banks insolvent, they are unable to earn their way out of this downward deflationary debt spiral. Even if the government minted fresh banks, lending would still be restricted as a result of falling asset prices. The asset price inflation economic model is a complete failure, a disaster.
Didn’t banks used to make loans to hold them and collect interest on the debt? Didn’t the money borrowed them get depositied into some bank, letting that bank then make loans?
And, if the money supply got a tad too small, the Fed would just buy for treasuries, and inject new seed money. That would then get deposited into a bank… repeat.
The whole sell them off. Wasn’t that just 0% reserve banking?
People save in banks and retirement accounts. There are two banking systems. The older regulated depositor based one and the newer lightly regulated shadow non-depositor based system. The non-depositor based system borrows money from the short-term commercial paper (CP) money market. After money managers in the CP market started losing money, they stopped lending to these outfits and the shadow system crumbled.
The thinly capitalized shadow banking model of borrow short and lend long, originate and distribute, has failed. All the banks and nations we read about on a daily basis used this model. Icelandic banks are good example. Although Citigroup is a member of the regulated depositor based system, it created special purpose entities outside the regulatory framework to access the CP market.
Very good explanation of the “real” problem.
The shadow-banking system has effectively been shut down.
If not for Fed+TARP, they would’ve been taken out with a crowbar in the eye.
Not all banks are insolvent.
I believe Ben has posted articles where there are banks that are still making loans and having no problems.
I agree. Even insolvent entities like Fan and Fred are making loans.
There is a short list of banks who refused government offers of aid. They did not want to be under the rules of government. One such example is New York Community Bank Corp. (NYB).
“Not all banks are insolvent.”
Let’s pretend you are correct and banks are not pretending they are solvent. To pretend otherwise would freeze up the economy.
Even if the statement “not all banks are insolvent” is false, what is true is that you’ve hit “peak debt”.
You have no more entities (corporate, individual, etc.) who are willing to borrow more, More, MORE.
That pretty much makes the “solvent banks” useless.
All of y’all sound pretty solvent to me. Why don’t you go borrow a million or so to buy a house?
See the problem (and the point)?
Check out the Fed’s BOGNONBR - non-borrowed reserves of depository institutions.
It went straight down at the start of the crisis, from 50B to -375B, but recently seems to have bounced back up to +175B.
Not sure where they found the 550B ?? I thought they “borrowed” the first TARP dump.
Gee, the prices are still falling so our boys can’t make money even if they loan to people who would normally pay them back.
And why are the prices still too high? Staff?
OK, well, let’s study that.
Now, on to discussion of our next plan to prop up housing prices!
Banks are lending.
Look at FDIC data: lending is up 8% over the last three months. At the same time reserves have shot through the roof (indication that people are not only saving but paying their loans.)
Journalist or reporter of news items?
Why If I’d lost $100,000 in my Shrub “leave-no-401K-behind” account, why…just a quick as a cat, I run right out to get a $9.00 bottle of “cheap whiskey”
Lordy, you should’ve seen what I used on Jan 20th 2009… as Opie Obama might say: ‘Shameful, Hwy, shameful!” 
Liquor sales slump — with the exception of whiskey:
“And in a trend contrary to other segments of the alcoholic beverage industry, the expensive stuff, or super premium whiskey, logged the hottest growth. In other areas of the market, consumers are trading down to less expensive brands, analysts report.”
America…land that I love…:
“Bourbon and Tennessee whiskey,” he said, “are unique and historic products of the United States that are capturing worldwide attention and acclaim.”
http://www.latimes.com/business/la-fi-liquor31-2009jan31,0,1032377.story
Background music:
http://www.youtube.com/watch?v=NH-72cunJx0
Hookay, Bay-Areans! My trip is getting solidified.
Planning to be there late March-ish for 2-3 weeks, and gonna be staying in the Mountainview area and also the SF area (friends, family, etc.)
Also, in play is a San Diego trip but that one is not solidifying as we speak.
Sadness:
Just found out that little brother had a fixed mortgage at 5.85% but refi’d a while back to an interest-only ARM that resets in 5 years, so that they could buy a minivan, etc. They bought for 390K and it appraised for 600K last year. He tried to refi to another 30-fixed recently and was denied after the house value came in at 330K.
Told him to sell in June 2005 (when I sold) and ever since. Now he wants to keep it until the market comes back. Tried to explain about real vs. nominal prices but, after he read Schiff’s book (which I have not read) he is convinced that eventual hyper-inflation (after initial deflation) will allow him to intersect the house value curve where he was in real terms and that having debt in an inflationary period is a good thing. I can see why the latter is reasonable, but I don’t know if I agree with the initial principle that hyper-inflation is coming.
Thoughts?
There was also the fantasy that when the rail system came to North of SF, that prices would rocket up again. The whole conversation made me wish that I could make him hit himself with his own hands like I used to while I said “Stop hitting yourself!” until he agreed to sell. I was a pretty crummy older brother and have been making amends ever since. I just listen and try to be helpful and not say things like “What the &*%^ are you thinking!”
MrBubble
Schiff has been notoriously wrong - hopelessly badly wrong.
He has done very badly by his investors, and is currently being ripped apart in both the MSM and the blogs.
Many of us (including myself) have called him and the gold hyper-inflationists on it repeatedly.
‘Many of us (including myself) have called him and the gold hyper-inflationists on it repeatedly.’
Yeah, and lookit! You made Aladinsane run off into the wilderness to hang out with his giant woody girlfriends and his sparkly ingots, and now we are deprived of the steady flow of bon-mots and Ayn Rand cheerleadingness.
Is this good? Is this bad? …
Considering that he was pushing the less financially-savvy posters into making extraordinarily bad decisions because he was a gold-dealer, I’d argue we are well rid of him.
There was no essential difference between him and a NAR rascal except he was pushing gold not houses.
Boy, it’s good to know we have a know-it-all looking out for everyone.
I called down a-sane more than once myself, but I never thought he was a gold dealer (always took him for more of a drug dealer than a gold dealer; those are the guys who have the money for the gold - no insult intended a-sane), and in case you haven’t noticed, people who have had a bias to be long gold haven’t done all that poorly.
Really? You truly think he was ruinous as far as an advice-giver for newbies and oldies? That he traded on his position as an old, established, respected regular here?
Hmmm. That’s an argument I’d listen to, I guess. Since you seem to be a straight talker yourself, and admit when you’re wrong and entertain doubts. (If someone can understand you, that is. I never can, so I just listen to the recipes and cruelty part.)
And, hey! I just thought of this. That could mean that …that you’ve got… you could have a heart of…well, you know…that one ‘Au’ substance
Hahahahahaha!
Yes, I think he was ruinous.
Fear is being created to sell something (what does that remind you of?)
To the previous poster, yes, he was a gold-dealer. He pretty much admitted it when he was called out on it. And in case, you haven’t noticed, out here, we care for logic, facts and arguments not scare-tactics.
Even if you don’t like me, you haven’t argued against the claimed facts. You are arguing against my personality.
For the record, I have nothing against gold. I own some myself. However, it is not the be-all and end-all of the universe. It is not even a good “investment” because as hozzie will tell you, the gold market is so small, it is easily manipulated by central banks.
big cat = big personality.
me likey. +1 puka shell.
Maybe we need a Hunks and Hunkettes of the HBB calendar?
Tastelessly unclad with puka shell necklaces, and all caressing gold ingots on a sunny Florida beach. with a distant view of the sea, the shore and the disastrous condos.
Hot diggity!!!
Oh, my goodness! I’d buy a million!
but, would you buy a Wheaties Box with a picture of Micheal Phelps doing bong-hits?…..that is probably a question for a different thread.
I like(d) Aladin Sane. I ignore gold arguments - white noise - so I never noticed if he was a gold dealer.
His comments caused me to think.
Agree, hoz.
I like many different **informed** opinions. It does us no good to live in an echo chamber.
+inf.
Funny that the ‘get rich in real estate’ commercials have been replaced by ‘Cash for gold’, huh?
Nice call on gold dealers as the new real estate agents.
Well, the good sign is that he studied, and made a strategy. This is way ahead of most submarine people.
Intent counts for nothing; only achievement counts.
After all, I don’t see the “I didn’t intend to cheat on you” defense flying with anyone, do you?
He failed, and failed spectacularly at that. Even the simplest strategy of saving your money in cash in different currencies (according to economy-sizes) beat the livin’ daylights of what he did. Heck, being 100% long S&P beat the livin’ daylights of what he did.
By all accounts, he is down between 70-80% for his clients. That takes a spectacular amount of incompetence.
“Intent counts for nothing; only achievement counts.”
I’m at least glad you believe it’s wrong to dole out additional punishment because a crime happens to be a so-called hate crime.
The whole “hate crimes” thing came about because the police force is notoriously racist and homophobic.
Try being a black man in Chicago. You can’t even get a cab in this day and age!
But yes, in theory, intent shouldn’t count. Only the crime should.
Oh, and just because your @ss got smoked because you don’t have a clue of basic economics doesn’t mean you need to respond to each post of mine.
You must be new here, pobrecito! You’ll get clobbered on this board without a sound array of facts and figures to back you up. We all do. You’ll get used to it.
I’ve been here a lot longer than you and I’ll let others decide if I’m being clobbered. But sickos like you always have to have the last word, so go ahead.
I dunno about that. I believe FPSS is a 2nd name for a longtime blogger here. Further to the point, start studying his posts.
And no flattery FPSS.
‘After all, I don’t see the “I didn’t intend to cheat on you” defense flying with anyone, do you?’
No, I sure don’t!
Hahahahaha! *doubles over with laughter, just thinking about recent events *
Oh. But wait. I just thought; is this a rhetorical question?
Anyway, Paul, don’t get all grouchy and run away into the wilderness in order to caress your shiny yellow ingots in peace, just ’cause Fasty roughed you up. You give good posts, even if you “aren’t a first rate math brain” (this is from yesterday’s thread when YOU said you didn’t know the equation thingie that was a proof of being a first rate math brain. Some Gause guy? Whatever. I bet he had no girlfriends, so don’t believe him. )
Look, let’s just enjoy the show, with a maximum of fun. That’s my motto.
I’m sorry Alad went away. And, now that I think of it, so did: Redpill, Tom of Sarasota FL, and several others, oh, and lately, Vermontergal. That’s too bad.
Gauss was happily married, and had six children.
Even though he was a misogynist in keeping with his times, and a curmudgeon of the first order, he did recommend Sophie Germain for a honorary degree in a time when women were not allowed into universities.
The myth of mathematicians not getting laid is pretty much one of sour grapes. In fact, many smart people I know are highly-adept “parallel” joggers (if you get my drift - wink, wink, nod nod!)
‘Gauss was happily married, and had six children.’
‘Happily’, huh? How do you know? Was you there? Who wrote the history, and was Gauss in the room when the notes got taken for the history books? See, my gran is married to one of them freak math-genious persons (that’d be the old guy I call ‘granpa’) and she produced 8 kids. I was there when my dear aunt Karen took her ‘oral history’ for the Mormon geneology books and I must say, THAT particular account differed substantially from her account I had heard at other times, when she sort of dished to me about what living with a freaky mutant was like.*
That is when I first learned to distrust history. Man, was that disheartening! Before that I had had the amusing belief that I could trust the written word.
Ah, the good old days….
* I wouldn’t know. I had no yardstick, and come to think of it, I still don’t.
The dorm I lived in during college at UC Santa Cruz was called “Gauss House”. It had a reputation on campus for not much partying but LOTS of screwing.
Ooops, sorry, I haven’t yet mastered the italics thing.
Thanks again for that, fasty, by the way.
Also, I’m sorry I was dubious about the felicity of Ms. Gauss. I bet she had a BLAST and it was all the time full of merriment and giddiness being married to some guy who scribbled on papers all day long and grumbled into his beard.
Oh, and that brings me to the second thing you posted:
In fact, many smart people I know are highly-adept “parallel” joggers (if you get my drift - wink, wink, nod nod.
THAT’S because nowadays you can shave and mathmeticians make super good money.
Is this good? Or is this bad?…
I’m still thinking about it.
‘The myth of mathematicians not getting laid is pretty much one of sour grapes. In fact, many smart people I know are highly-adept “parallel” joggers (if you get my drift - wink, wink, nod nod!)’
On the other hand, apparently Gauss could not hold a candle (wink, wink, nod, nod) to Bach when it came to prolific progeneration. Musicians do it with better rhythm.
There are many more Bachs han most people imagine:
the best known is Johann Sebastian.
Also, there’s Johann Christoph,
Johann Michael,
Carl Philipp Emanuel,
Johann Christoph Firedrich,
Johann Christian,
Wilhelm Friedemann,
Anna Magdalena.
And that’s all I know
Of the various Bachs.
(sung to the tune of “Jesu, Joy of Man’s Desiring”)
‘than most’…
WTF is that freak of nature steve forbes doing in Davos??? He’s calling for Bernanke to resign because…. get this… “what he’s done to the dollar”. lmao…
Ah, the struggle to stay relevant when the system that made you is on the verge of collapse.
‘Ah, the struggle to stay relevant when the system that made you is on the verge of collapse.’
I often mention this to myself, in solemn tones.
I failed my test, I see.
In fact, I don’t even SEE my test.
We see your test but we don’t see what you were testing.
I was trying to make an alkali. No, wait, I mean, an ‘italics ‘ thingie, so I could answer you about your clothing choices.
I never needed one before, so I didn’t bother to learn.
Here’s what you do. Type this:
Hello, this is in <i&rt;italics</i&rt;.
And you get:
Hello, this is in italics.
Sorry, that was clearly wrong:
Type:
Hello, this is in <i>italics</i>.
And you get:
Hello, this is in italics.
Thank you. Now I’m going to go criticize your shopping style. In <i&rt;italics</i&rt;.
DISASTER.
I’ve unleashed a monster. Read the second post. I made a mistake in the first.
Oh. Okay.
Thank you.
And don’t blame yourself, dear fellow–I had already slipped the leash and was leaping out of tablecloths to batten upon handy ankles. (See, I’m only a little monster.) Cuddly, even.
Awesome! Lookit!
Thanks. And as a favor to you, for this italic knowledge, I will never leap out of a tablecloth and bite your ankles. Serious. I mean, you know. Unless it seems best.
I can’t believe the AP prints this junk. Headline is
Gametime in the NFL: Super Bowl or Recession Bowl?
Then goes on to say a lady turns down buying a $145 sportswear item, states she won’t buy it cause her husband lost his job 2 months ago and they are watching their money (THEY ARE AT THE SUPER BOWL).
UUUh, Did I miss something?
http://www.google.com/hostednews/ap/article/ALeqM5iITyzetfyog-THOPHb5gXXPL9kqQD962V6800
“The Boss” and the E Street Band performed a decent half time and they even played their ode to the Messiah.
Now the Cardinals need to rally.
A company called Cash4Gold ran a spot on the Superbowl 43.
ROTFLMAO!!!
I dunno if that’s a contrarian indicator or not. Methinks it is.
but the question remains.
Are we approaching a MaGruber bubble?
Uh Uh…Gold as a great buy is not on the cover of Time or Newsweek yet.
BTW, where did all the house porn go? Is there any flip this house left in the old cable box?
Inquiring Roids want to know.
Roidy
P.S. I told you it was too big! They can’t handle it.
I don’t understand this Superbowl game. It’s pretty, and I like to see big men hit each other, but that’s like regular enchantments for me; and what I always like.
I’m watching, from the other room, so I can participate in the Amer’kin experience, and Jas can rightly call me a ‘dope’ later.
All I know is, I been trying to listen to it for 2.5 hours now, and it’s disturbing my comprehension of HBB posters, and also I’ve lost track of some wetland reports.
So, who will win? The big men in the cutest outfits? That’s what I’m hoping for.
LOL
No, I really meant this. It’s my theory that the cutest outfit ought to win. Jeebus likes cute outfits.
Man, there’s some good commercials, I notice. I already laughed a lot.
Oh, fer Chrissakes! I just wandered back out there and noticed that the men in the ugly outfits won! Dammit!
I guess that makes me a winner since I only own ugly outfits.
Okay, so the guy in the prettiest clothes, red and white, caught the little ball thing, and then ran fastest, with his hair bouncing behind his shoulders, and ran all the way? That’s good, right?
*tries to look smart *
A bank failure here, a bank failure there, pretty soon you’re talking about insolvency across the country:
Florida, Maryland, Utah Banks Shut as Financial Crisis Deepens
By Ari Levy
Jan. 31 (Bloomberg) — Banks in Florida, Maryland and Utah were closed yesterday as regulators wrapped up the busiest month for failures since the housing slump began in 2006.
Ocala National Bank in Florida and Suburban Federal Savings Bank of Crofton, Maryland, were shut by federal regulators, according to statements sent by the Federal Deposit Insurance Corp. MagnetBank of Salt Lake City was seized by the Utah Department of Financial Institutions. The banks had total assets of $876.4 million and deposits of $790 million.
Six banks have failed this month as tumbling home prices and a 16-year high in unemployment boost foreclosures. The FDIC classified 171 banks as “problem” in the third quarter, a 46 percent jump from the previous period amid the worst housing crisis since the Great Depression.
Regulators closed 25 U.S. banks last year, the most since 1993, draining money from the FDIC deposit insurance fund, which had $34.6 billion as of Sept. 30. Ocala and Suburban Federal combined will cost the FDIC fund about $225.6 million, the regulator said. No estimate was provided for MagnetBank.
Suburban Federal’s seven offices were scheduled to open today as branches of The Bank of Essex of Tappahannock, Virginia, which acquired the deposits. The Office of Thrift Supervision said it seized the bank because of more than a year of losses stemming from soured residential, construction and land loans.
“The OTS determined that Suburban was critically undercapitalized and in unsound condition,” the regulator said in an e-mailed statement.
TOKYO, Feb 2 (Reuters) - The Bank of Japan said on Monday it had offered to buy a total 430 billion yen ($4.78 billion) in Japanese government bonds (JGBs) outright from February 5.
The BOJ said it would buy 200 billion yen of JGBs with maturities of more than one year or less than 10 years.
The central bank also said it would buy 230 billion yen of JGBs with maturities of less than one year.
—
Cash 4 Gold.
I guess I sold early.
Oh well - I never went broke taking a profit.
How’s the sales on EBay doin’?
Ebay is for suckers, I’m pimpin craigslist.
Fool those whities into buying arrow heads on ebay cuz you can’t stand the lisitng fees!
After two bottles of Pinot Noir, I can’t believe I can type
So I learned some etiquette tonight:\
When a woman asks me what I am doing after dinner, I do not respond with the literal truth, I am supposed to respond “You”.
my thoughts:
A) She works at the bank
b) She thinks I am cute - WTF.
c) She is as loony as they come.
I gave her the literal truth and have been soundly lambasted by DILs and grands all evening.
Dang it! What kind of male friends do you have?! You should know this!
“Redemption policy
As a firm, we have not imposed any gates or other restrictions on clients withdrawing their assets. While we recognize the difficulties of the current environment, we think it’s a manager responsibility to raise liquidity to meet the needs of their investors. There is plenty of liquidity in the markets. Even in opaque areas of the markets such as in bank debt, mortgage backed securities and other distressed securities, we see hundreds of millions of dollars trading every day. We are especially surprised that many managers have restricted client withdrawas when: 1) the total redemptions are manageable (15-25% of AUM); 2) the managers have the cash; and 3) one of the stated reasons for restricting withdrawals is so the manager can continue to invest in new opportunities.
Emphasis added. ”
John Paulson
as reported by Bronte Capital
I know a bit much about liquidity. Burp.