The Sound We Are Hearing Now
It’s Friday desk clearing time for this blogger. “President Barack Obama took aim at the housing crisis during his first 100 days with a broad plan to stabilize the market by trying to prevent foreclosures, pushing down mortgage rates and offering a handsome tax credit to new buyers. But has the effort helped South Florida, where foreclosures are soaring, many homeowners have little or no equity and price declines show no sign of abating? The merciless slide in home prices has made it tough for many homeowners to benefit.”
“Borrowers aren’t likely to stick with the program if prices keep falling, said attorney Roy Oppenheim, whose firm specializes in foreclosure prevention. Retiree Carmen Carrio, for instance, bought a condo in Dadeland four years ago and got her loan modified in December. After a condo next door sold as a foreclosure for $75,000 this month, she decided to stop making payments on her $171,000 loan.”
”’I will walk away and go rent somewhere,’ Carrio said.”
“The region’s condominium market, once the entry for first-time homebuyers, continued its downward spiral in the first quarter as sales fell by nearly 27 percent. As sales tanked, condo prices in Massachusetts posted the sharpest decline in more than two decades. The median condo price dropped nearly 17 percent from January through March to $220,100, according to The Warren Group.”
“Despite realtor claims of ‘packed’ open houses and ’strong’ buyer interest, single-family sales didn’t fare any better. Sales of single-family dwellings dropped by 10.8 percent to 6,160 compared to a year ago, the slowest sales pace for a first quarter since 1991. Monthly median home prices have been falling by double-digit percentages year-over-year since last September.”
“But at least one housing expert is convinced there’s good news in between the lines. ‘We’re in a big recession and it’s not done yet, prices are still falling and there are lots of foreclosures,’ said Karl Case, an economics professor at Wellesley College. ‘But the rate of decline is slowing and in the western suburbs and some South Shore locations, we’re seeing things turning around.’”
“John Ellsworth, an owner agent with Homes Connection in Ashland, said many of the multifamily homes for sale were owner-occupied, but in those, owners were swept up in the same mortgage mess that struck many owners of single-family homes. In Ashland, for example, at least one-third of the town’s foreclosed properties were multifamily homes, he said.”
“Even with dropping rents - a two-bedroom unit that went for $1,200 could go as low as $1,000 now, he said - the demand for multifamily homes remains. In Marlborough, 15 multifamily houses sold in the first quarter of 2009, 10 more than the same time a year earlier. Median prices also fell from $290,000 to $155,000, said Eric Berman, a Massachusetts Association of Realtors spokesman. ‘It is an investment, even if it’s owner-occupied, because you are deriving revenue’ from tenants, said Berman.”
“David Strainer, president of the Warren County Board of Realtors, said home sales in the Glens Falls and Queensbury area were never depressed, but the market has definitely started to pick up. The biggest jolt of activity, he said, has come in the form of dropping home prices. Strainer has observed many inflated listings that sat on the market all winter and have sold after shedding tens of thousands of dollars from the price.”
“‘What’s really helped is that the prices have come to where they should have been,’ Strainer said.”
“He advises clients who don’t want to let go of their home for less than they think it’s worth that when they sell low, they can buy low. Wait until the market is back at its peak, and homeowners will sell high only to buy high, he said.”
“All across the Memphis area, foreclosed homes have glutted the market and are being sold at prices as low as a half, one-third or even one-tenth their appraised values or the prices they had previously fetched. Others are remaining vacant, creating another set of problems.”
“The bargain-price properties are found in every level of the market. They range from a 6,400-square-foot home in Eads that sold last month for less than half its $900,000 price from 2007 — and is now listed for resale at $380,000 — to three homes on a block in Orange Mound that a Utah investment firm snapped up for a total of $15,000.”
“Local planners and community activists worry that the conversion of large numbers of homes from single-family ownership to rentals could cause neighborhood declines across the Memphis area.”
“‘I think there’s some kind of tipping point — and I don’t know what that is — at which there’s so many rentals that the neighborhood becomes undesirable for homeowners,’ said Emily Trenholm, executive director of the Community Development Council of Greater Memphis. ‘Nothing against renters, but I think people don’t feel the same personal stake in the neighborhood as when they own property.’”
“In California and across the United States it’s become a trend to sell $150 tickets that can win a $2 million house – and ring up leftover money for a group doing good deeds. So what if you win? How do you pay the taxes? Remember the woman who won a free $250,000 house in Lincoln last month with a $96,000 tax bite? Imagine that on a $2 million house.”
“‘HGTV does a sweepstakes every year for a million-dollar house, and I don’t think anyone who’s won it has lived in the house for that reason,’ said Sandra Sims, president of Step By Step Fundraising. ‘If you can’t pay the taxes, you have to sell the house, and in this market it’s hard to sell.’”
“The housing slump has reached even the wrought-iron gates of Silicon Valley’s great estates, where the rich and sometimes not-so-famous are having to adjust their thinking and their asking prices. Exhibit A is Stonebrook Court, a grand 30,000-square-foot Tudor on 7.5 majestic acres that dwarfs its neighbors in this bucolic enclave. It was bought a decade ago for $5 million by Kelly Porter. His listing agent said…Porter may be more flexible now than he was last summer.”
“‘He’s not lowering the price but will consider less,’ said Olivia H. Decker of Decker Bullock Sotheby’s International Realty.”
“High-profile suicides like that of the finance chief at embattled Freddie Mac highlight the dangers that an economic crisis poses to the powerful as well as the vulnerable, experts say. Dr. Shelley Reciniello, a psychologist experienced in counseling Wall Street executives said she and her colleagues are hearing of suicides on Wall Street that are not getting much attention. ‘Absolutely, there’s a lot of this agony going on,’ she said. ‘People are very vulnerable.’”
“‘Their worlds are basically crumbling,’ she said. ‘Everything that they had hoped for and really seemed within their grasp over the last 20 years or so is ending.’ At the heart of it, she said, ‘there’s a disparity between who you want to be, who you thought you were and who people are telling you are today, and that hurts like hell.’”
“Until the housing bubble began its slow painful deflation a few years ago, Countrywide Financial Corp. the nation’s biggest home lender, had 40 years as a reputable lender that helped millions acquire homes, a co-founder says. Now that era is a memory. The collapsing company was folded into the Bank of America a year ago laden with high-risk loans, enormous executive salaries and federal investigations.”
“With its name ‘too toxic to resuscitate,’ as an expert says, Bank of America has begun rebranding each branch.”
“It’s been a good 20 years since I first met Angelo Mozilo, the California founder of what became the Countrywide mortgage lending giant. And then, as now, he struck me as the mortgage industry’s incarnation of actor George Hamilton: Tan-obsessed, big on sartorial splendor and sure everyone in power would see things his way.”
“Well, times have changed. And the legal power in Florida wants Mozilo to visit the state. A U.S. District Court judge remanded a lawsuit filed by the state of Florida against Mozilo back to Broward County Civil Court. The action came in a case filed by Florida Attorney General Bill McCollum alleging that Mozilo and Countrywide violated the state’s deceptive trade practices act by placing consumers in loans they could not afford or with rates that were false or misleading.”
Let’s be perfectly clear. Mozilo went overboard pushing risky mortgages. He should be held accountable. But where on earth was McCollum — in fact, any legal and financial regulator — all those years when mortgages were approved and handed out to anyone who could scrawl an X on a signature line and, presumably, did not drool too much.”
“A U.S. House panel approved legislation that would prevent lenders from transferring all mortgage risk as part of a bid to boost consumer protection during the deepest housing slump since the Great Depression. Lawmakers said they were trying to curb lending abuses that contributed to record losses on securities linked to mortgage payments and a 24 percent increase in U.S. foreclosure filings in the first quarter from a year earlier. ”
“‘If this bill passes, there will continue to be a vigorous mortgage market, and it will continue to function better,’ said Committee Chairman Barney Frank, a Massachusetts Democrat.”
“Frank said last month that 100 percent securitization ‘allows bad originations because people make loans and don’t have to worry about being paid back.’ The committee debate included efforts by Republicans to change a measure they said would impose too many limits on lenders.”
“‘It sounds like every mortgage made in the past 10 years has been a toxic asset, and that’s just not the case,’ said Representative Randy Neugebauer, a Texas Republican. ‘And how many of those people’ with bad loans ‘have taken out mortgages they really shouldn’t have.’”
“‘When Secretary Alfonso Jackson in the Bush administration proposed ending Section 8 assistance to lower-income people in need of help to rent decent apartments, I objected that this would leave people with no affordable housing after five years. When I asked him directly what he planned to do for those who would find themselves in this situation if his five-year cap on Section 8 eligibility were to go through, his reply was that we would help these recipients become homeowners.’ —Representative Barney Frank.”
“Is Washington mental? Where can you buy a home with very low income from naught but Social Security or disability benefits? The Ozarks? The Okefenokee? The still-devastated part of New Orleans?”
“This exchange is extremely telling, demonstrating the brainwashing we have all experienced about the ‘everyone-can-have-it’ American Hoax—sorry, Dream.”
“House prices all across Bulgaria’s regional cities have slumped in the three months through March 2009 from the previous quarter. The average housing price in the first quarter was 1190 leva a sq m. Last year it peaked at 1418 leva a sq m between July and September, making an average national decrease of 16 per cent from July to March.”
“Experts say residential prices will slip to their lowest in the third quarter of up to 30 per cent on an annual basis. From January to March, prices plummeted the sharpest in Veliko Tarnovo (-25.1 per cent), Kyustendil (-21.5 per cent), Blagoevgrad (-20.5 per cent), Rousse (-18.8 per cent) and Vidin (-17.8 per cent).”
“The property section of The Irish Times ran its annual review issue this past weekend. ‘If You Can’t Sell, Swap.’ ‘Market on the Floor.’ ‘Prices Down by 40%.’ ‘Estate Agents Bracing Themselves for Further Losses.’ In all I counted a dozen or so headlines that portrayed the incredible crash in property prices that has gripped Ireland.”
“What caused the collective madness that saw an acre of land in Ballsbridge, the exclusive Dublin suburb, go for $132 million an acre just a year or so ago? That was apparently the highest price for a plot of land anywhere in the world at the time. A new bestselling book by Irish Times journalists Frank McDonald and Kathy Sheridan, entitled ‘The Builders,’ goes a long way to explain what happened to overheat the market.”
“What they all believed is that the tree would grow all the way to the sky, fiercely bidding against each other for prime properties even as the telltale signs of a housing collapse loomed on the horizon.”
“Politicians of all parties clearly had their votes bought at crucial planning permission sessions of Dublin city and county councils, as well as at council meetings all over the country. The Irish banks were major colluders in creating the bubble, handing out loans like confetti to the developers and mortgage seekers alike. No one wanted the party to stop.”
“The sound we are hearing now is that bubble bursting with consequences for everyone, most notably homeowners caught in a vicious cycle of heavy mortgage repayments. The developers have not escaped. During my recent trip several journalists told me they believed many of the top 10 developers are actually bankrupt and hopelessly over-extended.”
“The property developers face financial ruin, the banks face massive restructuring while the government faces a barrage of questions as to why they did not act sooner to smash the speculative bubble.”
“The answers may never be known, but in an unforgettable chapter in the book the writers describe the annual property developers’ ball at a swanky Dublin hotel. As recently as this year the invited speaker was defiant, swaggering and adamant that prices would continue to soar and the present difficulties were just a blip.”
“The unsinkable Titanic comes to mind.”
“Eighteen months ago when I was last here, the joint was jumping. Today it seems tired. I make my way to the Stratosphere Casino Hotel, where a room costs $US29.95 a night. Las Vegas needs to maintain its hot status, so you won’t see much advertising of the steep discounting that’s occurring (you can go up-market and stay at the Las Vegas Hilton for less than $50 a night).”
“All this goes some way to explaining why Jamie Packer has been looking a little blue of late. The Wall Street Journal recently reported that at the peak of the market (about the time he was buying) the listed market value of the gaming industry worldwide was said to be about $100 billion, yet by February this had fallen to just $11 billion.”
“Many of the legendary Strip owners, like pioneer Steve Wynn, are reeling from taking on too much debt in the belief that the boom times would last forever.”
“One out of every 22 homes is in some form of foreclosure. The Case-Shiller Index shows a decline in prices of 44 per cent from the 2006 peak. Realtor Jennifer Martin runs House-Hunting Safari - taking bargain-hunters through the sub-prime jungle while she’s decked out in a safari suit (this is Vegas after all). According to her website, the tour will show you homes reduced up to 70 per cent from peak values - some even more - priced from $US 25,000.”
“My brief stayover has shown me that the sign we saw earlier was wrong: what happens in Vegas does not stay in Vegas. Rather it’s a mirror for what’s going on in the rest of the country, and the world.”
“Tom Cargill, economist at the University of Nevada, Reno, said Nevada will lag behind the nation when the economy rebounds. ‘We had the biggest bubble and the biggest burst of the bubble,’ he said of the housing collapse. ‘The center of the financial storm is housing.’”
“Cargill also criticized the federal government’s pumping hundreds of billions in taxpayer dollars into economic stimulus, saying similar measures only lengthened Japan’s recovery a decade ago.”
“Faced with bottom-line competition from foreclosures and short sales, homebuilders in Las Vegas have reduced prices to the point that some are selling for less than $100 a square foot. The average price of a new KB home at Manchester Park in the master-planned Providence community is $154,200, or about $80 a square foot, housing analyst Larry Murphy said. That compares to the average foreclosure price of $149,746, or $84 a square foot.”
“It was about 10 years ago that new-home prices in Las Vegas topped $100 a square foot and everybody was squawking about how the market had become more expensive than Phoenix, the most comparable city in the Southwest region. The bursting of the housing ‘bubble’ has brought prices back to those levels.”
“D.R. Horton dropped prices by about 50 percent across the board in January and was the No. 1 homebuilder in Las Vegas for the first quarter with 210 closings, Murphy reported. ‘Apparently, that strategy is working,’ he said.”
“A household with a median income of $52,800 a year needs to devote 25 percent of income to buy a median-priced single-family home at $164,600. In July 2006, that ratio was 44 percent. Jim Widner, president of KB Home’s local operations, said his company is targeting entry-level buyers and renters with a May 9 seminar about the benefits of homeownership. KB has been able to bring the price of a 2,600-square-foot home at Manchester to $179,900, or about $67 a square foot, Widner said. Less demand for materials such as copper and lumber, combined with more available labor, has resulted in substantial savings, he said.”
“‘You’re going to see a return to single-story. You’re seeing people get back to what do I need, instead of what can I have,’ Widner said.”
“‘People make a big deal that the price of (owning) a home is cheaper than rent,’ Widner said. ‘Shouldn’t it be? You save to put money down and you make a few sacrifices. Why shouldn’t it be cheaper than rent?’”
This is one of my favorite DC posts ever. ‘People make a big deal that the price of (owning) a home is cheaper than rent,’ Widner said. ‘Shouldn’t it be? You save to put money down and you make a few sacrifices. Why shouldn’t it be cheaper than rent?’
To have housing execs repeating the points we’ve been making for years!
‘We’re in a big recession and it’s not done yet, prices are still falling and there are lots of foreclosures,’ said Karl Case, an economics professor at Wellesley College. ‘But the rate of decline is slowing and in the western suburbs and some South Shore locations, we’re seeing things turning around.’
OK, I challenge Case and Shiller to a debate with the HBB online. Nobody does it better.
Anyhoo, another great week! My thanks to those who support this blog. Please check back this weekend.
Hello Flagstaff & your getting closer to nice hot beer drinking weather!
Thanks for all your efforts Ben!
Hello Flagstaff & your getting closer to nice hot beer drinking weather!
Thanks for all your efforts Ben!
Ditto.
It is getting hot all of a sudden. You know what that means? Hefe!
My bet is on you in the debate Ben. Bring them on!
And after reading in Apr 28 NW thread about you and your brother wiping up the bullies after a frat party, back in the day - I suggest Friday night freestyle RE pundit SMACKDOWNS !
Nohow, I just this VERY instant posted on the same thing! Except I was more sedate than you, zilky. I simply wanted to hear more about Ben.
I mean, there could be a college course on Ben one day*. I want a head start on the subject.
* ‘Ben: The Man, the Mystery: 101′.
the rate of decline is slowing and in the western suburbs and some South Shore locations, we’re seeing things turning around
Asking prices are still too high for well-maintained single-family homes in desirable neighborhoods. If you want a foreclosure in Brockton or New Bedford, the prices drops are there, not so much for an SFH in South Westport, Duxbury, or Newton. The economists are saying things are turning around before the eye of the storm has even passed. More downward price pressure ahead: higher state taxes (sales tax, income tax, etc.), lower wages (Globe union concessions), more layoffs (Turnpike Authority, Acushnet Co., etc.)…
It is an investment, even if it’s owner-occupied, because you are deriving revenue’ from tenants
I wonder what multiple of rent they are paying on these properties. My guess is somewhere between 90 and 110 depending on location and condition… I’m also curious what terms investors are paying right now for non-owner-occupied financing?
RE: condo prices in Massachusetts posted the sharpest decline in more than two decades.
Due to historical shortages of quality land, scores of condo’s emerged from “bad ideas”.
Conversions of apartments from old tri-decker’s in crap urban neighborhood’s were marketed under “gentrification”.
Newer ground-up projects usually ended up on some junk land parcel situated adjacent to an interstate highway or former landfill, exposed to traffic noise, dirt, & obnoxious smells.
Then the greed factor finally escalated to carpenter hacks subdividing their own residential lot and throwing a duplex up in their rear yards, which just happens to be facing into a Wal-Mart parking lot. Yup, lot’s of curb appeal here.
You’d drive by these projects and go WTF?
That ANY of this trash passed appraisal muster is beyond comprehension.
Due to historical shortages of quality land, scores of condo’s emerged from “bad ideas”.
Agreed. I have friends/co-workers who live in South Boston condos and they all say the same thing: “It’s different here, my neighbors are wealthy and everyone wants to live in South Boston”… now it may be a great neighborhood, but it doesn’t change the fact that 400/sq. ft. is over-priced for a 1200 sq. ft. 2 bed condo. Things in Boston will change as the higher-ed bubble pops and parents have less money/credit to throw at housing here.
I once lived in an apartment complex in southern NH, just over the border. Apparently had been some dispute/broken promises between the nationwide developer and the city, resulting in the only access to the apartment complex being through the Wal-mart parking lot. Seriously, no other entrance to the complex.
I moved in about 6 months after they were completed, moved out a year later. The complex was in great shape, great residents when I moved in. By the time I left, it was a hole. It went through a couple owners while I was there, as I was moving out there was talk of a condo-conversion, which apparently never happened. Thankfully.
Where was this? I used to live in Nashua, NH.
RE: resulting in the only access to the apartment complex being through the Wal-mart parking lot.
BC~
Remember that Seinfeld episode where the neon Kenny’s Fried Chicken sign blazed away into Kramer’s apartment?
I saw an 8 unit townhouse complex go up on this spagetti lot next to this huge parking lot of a former Sylvania mfg. plant. All units faced the lot.
Being Sylvania, producer of lighting products you can be sure they had their lot lit with the biggest, baddest outdoor florescents of them all.
Any purchasers would have to had triple drapes on their windows to get any form of nighttime darkness.
Always used to think of that Seinfeld segment when I drove by at night.
Salem….Living in the parking lot with all the RVs…the only nice thing is Christmas Eve I went to Wal-Mart to get dinner and a case of beer.
Hmmm, deriving revenue from tenants. Where to begin with that one?
Oh, I know. What happens if one or more of those illustrious tenants decides to stop paying rent? It’ll take a while to evict ‘em.
And, after they’re gone, you’re probably going to have some repair work. That’s going to send some of that derived revenue over to your expense column.
One more thing about tenants: They move. Yes, they do. When you think you’ve got a good one, they get married, find a job out of state, and poof! They’re gone.
Which means that you’ve got an empty unit to lease. And that can take many moons.
$67 a square foot
Remember all those trolls insisting that housing prices couldn’t fall substantially because the “cost” of construction would put a floor on the market? As if that cost was something immutable and god-given.
I’ve mentioned this before, but my dad built a beautiful, rammed earth adobe, radiant heat, super insulated, highest quality finishes house in Santa Fe for less than $70/sq ft in the late 1990’s (acted as his own GC). So much for making $150/hr to hang drywall.
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“House prices all across Bulgaria’s regional cities have slumped in the three months through March 2009 from the previous quarter. The average housing price in the first quarter was 1190 leva a sq m. Last year it peaked at 1418 leva a sq m between July and September, making an average national decrease of 16 per cent from July to March.”
“Experts say residential prices will slip to their lowest in the third quarter of up to 30 per cent on an annual basis. From January to March, prices plummeted the sharpest in Veliko Tarnovo (-25.1 per cent), Kyustendil (-21.5 per cent), Blagoevgrad (-20.5 per cent), Rousse (-18.8 per cent) and Vidin (-17.8 per cent).”
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This is funny. I am a Bulgarian and I need to say few things here, because example is not very good for the American public. First peak price of 1400 leva is 900 per m2 (around 11 square feet), ie $80 sqr/f, not much for a bubble in a EC country.
The major factor for the falling of the prices is the credit contraction. Credit contracted 20 times! Bulgaria is a small economy very dependant on the world finances. By the way this is a good example of a credit contraction. 20 times!
What looks like a blowing bubble there was mostly due to rising salaries and appearance of credit (not expansion, because there simply was no credit at all before 2003) Salaries have increased 3 times since 2003, credit is used at the peak in only half of the all purchases, the rest is cash
What I am saying is once they see light in the tunnel form the world economic crises and some restoratgion of credit Bulgarian housing market will immediately regain what has lost, but will stay there for long. This people have savings and nobody ever heard about 100% financing from Countrywide… Besides this in social Europe people have more financial security with unions and labour laws. Example is Spain with 17% unemployment, house prices have gave up only 10% for already 2 years of misery. There is no forced sales… because people have savings. 17% unemployment!!! (There is no way to explain to a sane European dude that 50% of all Americans have savings for only 1 month unemployment. ) Bottom-line there is no lesson for US here because house prices here are doomed for long period. I believe they will never recover to the level of 2004 for long long time. Saying this my hedge against the disaster of investing in American properties was investing in Bulgarian property and I still feel good about it.
Right, it’s different in Bulgaria. Just like it’s different in Russia.
“Carmen Carrio, for instance, bought a condo in Dadeland four years ago and got her loan modified in December. After a condo next door sold as a foreclosure for $75,000 this month, she decided to stop making payments on her $171,000 loan. I will walk away and go rent somewhere,’ Carrio said.”
Another HBB prediction comes to pass…
If you look at the article, it has a FB who bought a condo LAST YEAR. Wake up Washington: all you are doing is creating more foreclosures.
WOW!
“Jimmy Herrera, 28, under water by more than $50,000 on the Hialeah condo he bought last year, said he has little confidence his bank will offer a loan modification because he hasn’t yet missed a payment.”
“Perhaps the biggest roadblock to recovery in South Florida is that banks, for the most part, still aren’t lending.”
”The administration . . . is clearly having an impact in mitigating this disaster,” said Mike Larson, a real estate analyst with Weiss Research in Jupiter. “But ultimately, it’ll be the passage of time with lower prices and a turn in the broader economy that will finally put this housing downturn behind us.”
And THAT’s the money quote from the Miami Herald article. Ultimately, that’s how the housing downturn will end. All this other crap is just an attemp to stave off the inevitable.
$67. per foot for new product plus the big builders have access to cheaper financing through bulk buydowns below par…This has got to destroy the re-sale market anywhere close to these developments….
The average price of a new KB home at Manchester Park in the master-planned Providence community is $154,200, or about $80 a square foot, housing analyst Larry Murphy said. That compares to the average foreclosure price of $149,746, or $84 a square foot.”
scdave,
I would argue what is happening is the government is creating incentives to keep building when there is a HUGE surplus. This will drag out the recession.
In my opinion the government should be spending the money on infrastructure (with most of it factory pre-cast) and home DESTRUCTION. There have been posts about the demolition teams comming out in Victorville and other areas. Its time for that prediction to be more common. (I’m aware of less than a hundred partially or fully completed homes being demolished. In other words, a trivial number.)
Got Popcorn?
Neil
Ben, oh fearless HBB leader, could you refresh our memory? Didn’t you once say that unsold housing developments — not just houses, but entire developments — got bulldozed during the Texas real estate crash of the 1980s?
Yes, I remember subdivisions getting dozed because no one lived there and nobody wanted to pay the insurance on them.
I don’t know how fearless I am. I still jump a little when I see a snake out on the trails. And don’t get me started on spiders that hang down in my face all of a sudden.
Ben - funny you mention that. I can deal with snakes. Growing up in Florida, I got used to offing the bad ones and catching the good ones and relocating them. But spiders totally freak me out. I would rather deal with four, maybe five angry (name it) than one spider that I know is near me and I can’t find and squish. I’ll risk death by DDT poisoning before I’ll let my house be home to those suckers.
“In my opinion the government should be spending the money on infrastructure (with most of it factory pre-cast) and home DESTRUCTION.”
Let the arsonists burn these homes down, then.
Have any of the HBBers read of any widespread arson of the underwater houses???
I’ve said all along that you can build for $50/sqft on someone elses lot and make money.
For whatever reason, most still reject this generally speaking….. with the exception of guys who actually build. They know it, I know it.
Sure wish Vegas were closer to Georgia. Prices are falling, but not fast enough to reflect the reality of buyers’ willingness and ability to pull the trigger. Tracking individual neighborhoods, I see some where the shadow inventory (withdrawns, many of which were active multiple times) are equal in number to the properties that are listed as for-sale. And that doesn’t even count the properties whose owners are in trouble and hoping the market will clear so they can list their own place for the first time.
Sooner or later, there has to be a collective “Ohhhhh, Crap!” moment in each of these neighborhoods.
Chip,
If there is one thing I’ve learned, it’s that what happens in the earlier markets happens elsewhere eventually. When I was studying RE in college, rents were generally higher than mortgage payments. No matter how one looks at it, this is the logical relationship. And given the overbuilding in Georgia, IMO this will happen and then some.
Hah! You studied RE in college? After these three years, I didn’t know that. Well, you must be smart, because you somehow avoided being brainwashed.
He also got in fights in the parking lots of rival fraternities.
(Thanks for that little bit of Ben Jones History the other day, Ben.)
Say, since it’s the weekend, how about you tell us more about you? Flesh out the ‘Legend of the Man, the Mystery’, so to speak.
Like, do you have a dog, and is it named ‘Rex’? Or ‘Max’? Do you wear an apron when you BBQ? Pertinent details like that.
Well thanks OG. My pal went to doggie heaven a couple of years ago, and her name was Tabasco. I need to get another dog someday. I don’t have a BBQ thing, but if I did I wouldn’t wear an apron.
My favorite color is green, and I like to throw rocks and use big words. Preferably at the same time.
Are you modeling the HBB T-shirt, or is that your brother?
“…I like to throw rocks and use big words” LMAO
Just like the younger brother in “Old Yeller”
‘Are you modeling the HBB T-shirt’
Yes, that’s me. Besides, my brother would charge me. (Just joking bro!)
Ben…….you almost sound ….Normal….
spill the beans you were a wild eye frat boy getting 9 women pregnant with your 6 kids…..LOL
*Happy squeal!*
* Followed by industrious scribbling of notes *
I am TOTALLY gonna get an ‘A+’ when I take the undergrad course:
‘Ben Jones: The Man, the Mystery: 101′!
Ooooh, I can’t wait…
And green is my favorite color, too!
Do you not BBQ because you don’t eat your fellow dwellers upon Mother Earth? It seems to me you once said you were a vegetarian. Are you a Vegan? No, because how’d you get so buff, then. Hmmm….maybe you eat cheese all day long? What kind of cheese do you like?
Just like the younger brother in “Old Yeller”
Okay, how about we make a pact to never, ever, ever mention ‘Old Yeller’ again. EVER.
I well recall picking up my little yellow plastic chair and forming a line and obediently trundling down the hall to the auditorium of Lakeshore Elementary in the tiny town of Benjamin, Utarr and sitting in a row and earnestly watching ‘Old Yeller’ on the big white screen, all flickery and skipping because it was an old projector.
And I cried so hard I threw up on the floor.
Okay, then!
OG,
No. I eat veggie BBQ stuff. I actually make it myself too. But I do it stove top. I guess I just haven’t had time to do the backyard thing these past few years. I do eat cheese occasionally. It would be a shorter list of the cheeses I don’t like, but I am partial to aged cheese, blues, not real crazy about smoked, though.
but I am partial to aged cheese, blues, not real crazy about smoked, though.
*more industrious note-taking scribbles *
(This will probably be covered on the extra-credit part, Hahahaah!)
I get all my cheese at the Grocery Outlet, and I always enjoy seeing the ‘Aged for—-’ label’ right next to a ‘Time dated’ label. I mean, isn’t that EXTRA ‘agedness’? Plus they have crazy flavors there.
I like eating cheese and reading at the same time, because peaches, for instance, splash the pages too much.
Speaking of, who’s your favorite author, Ben? Fiction, I mean.
Ben - I’m very hopeful that it’s “and then some.” The sheer number of houses that already are for sale and priced at $350,000 and up is mind-boggling.
Currently, my rent is only 2/3 of what an 80% LTV, 4.5% mortgage payment would be on the place and I have no maintenance costs at all, just electricity and phone. A pretty decent way to wait out the slide in selling prices. I’d rather be out in the country, but the price for that is still too high.
Georgia is cheap compared to other coastal cities.
Tim - as coastal states go, I suppose that is true, but it’s relative to what a person can afford. Anyway, I’m looking inland, in a 50-mile radius outside Atlanta.
“Dr. Shelley Reciniello, a psychologist experienced in counseling Wall Street executives said she and her colleagues are hearing of suicides on Wall Street that are not getting much attention. ‘Absolutely, there’s a lot of this agony going on,’ she said. ‘People are very vulnerable.’”
How does the MSM miss a story about Wall Street executive suicides, yet manage to yammer endlessly about a flu strain that is (so far at least) no more severe than the flu strains that hit the US every winter, year-in, year-out?
…no more severe than the flu strains that hit the US every winter…
Because it’s all about the ratings.
It’s the 2009 version of the killer bee invasion.
Remember all the hysteria about that one?
Our local TV stations (Southern Cal) even ran migration
maps that looked a bit like troop movements in Europe
during WWII.
Geez, It’s amazing that we all got out alive. <;)
RE: How does the MSM miss a story about Wall Street executive suicides, yet manage to yammer endlessly about a flu strain that is (so far at least) no more severe than the flu strains that hit the US every winter, year-in, year-out?
You think a media editorial system, now largely run by women, is going to cover a story about a bunch of “greedy” middle-aged, white men killing themselves?
Pffffffffttttttttt…
The focus on the flu is all about whipping soccer mommy’s into an hysterical frenzy to demand more from government, as in the state of Mazzland which has already secured legislation which allows the governor to declare marshal law as soon as enough little Jimmies come down with the sniffles.
dh74man:
This is not a blog about “why we should all hate women”, K? Just point that out. Oh, and maybe you should see a therapist or something.
With Love,
Big V
RE: Oh, and maybe you should see a therapist or something
Yeah, gotta luv the kill the messenger types when the words don’t fit the politically correct mold.
Maybe you need to be the one to see a therapist.
Seems you’re the one who can’t see what’s the current reality is, prefering to traipse to the liberal media beat reported thru the eyes of Manginas, Fem-Hags, and Gays.
…Manginas, Fem-Hags, and Gays.
Man, I thought Vegas was weird.
Hey ladies and girly-men,
hd74man knows about the Manginas, Fem-Hags, and Gays… HE KNOWS!
Sic the succubi on him!
I meant to say “Just pointing that out”.
RE: Maybe you need to be the one to see a therapist.
LMAO!
As the saying goes,
If you’re not taking flak, you’re not hitting the target.
OK, so you have succeeded in your goal of pissing off girls. You are the man. Do ever get sex without paying for it? Do me a huge favor and stick to the topic, wontcha?
Thanks, Big V.
It gets rather annoying, doesn’t it?
The gender element of this story completely eluded me, though I will acknowledge that so far as I am aware, most pig men are males.
The dude has a whole bunch of tiny little chips on his shoulder, and he likes to take them out on people who seem like easy targets.
Given the sums of money that have already been thrown into the sea, the accounting treatment of $3.7 bn some how does not seem like that big a deal.
Wall Street Journal
* BUSINESS
* APRIL 30, 2009
FBI Looks Into Losses at Freddie
By JAMES R. HAGERTY and EVAN PEREZ
(See Corrections & Amplifications item below.)
Federal investigators looking into possible accounting violations at Freddie Mac are raising questions about whether the giant government-backed mortgage company improperly delayed the recognition of billions of dollars of losses, according to people familiar with the matter.
A confidential February 2008 report by the investigative firm Kroll concluded that “inappropriate application” of accounting rules “enabled Freddie to defer billions of dollars of losses incurred from 2001 through 2004″ on derivative contracts whose value depends on fluctuations in interest rates, according to people involved in the matter. Those losses, currently pegged at about $3.7 billion, are due to be gradually recognized in quarterly earnings statements over the next several years.
Investigators from the Federal Bureau of Investigation have obtained a copy of that report, which was never publicly released, and recently sought more information on the issue, these people said.
The Justice Department and the Securities and Exchange Commission have been investigating a range of accounting practices at Freddie Mac and its larger rival, Fannie Mae, for at least six months. Both firm have disclosed the investigations but haven’t provided details on the questions being raised.
A spokeswoman for Freddie said: “We are confident that our accounting treatment was appropriate and consistent with all applicable accounting guidance.” A spokeswoman for Kroll, a New York-based unit of Marsh & MacLennan Cos., declined to comment. The regulator, the Federal Housing Finance Agency, said it had decided early last year “not to take issue with the accounting” despite the findings of Kroll, which had been hired by the regulator to look into the matter, a spokeswoman for the agency said. She cited “disagreement among the experts” and Freddie’s defense of its accounting.
The return of Gordon Gekko in Wall Street 2
Posted April 29th, 2009 by theStockMasters…
According to The Los Angeles Times , Wall Street 2 is officially a go. Oliver Stone will direct, and Michael Douglas will reprise his role as Gordon Gekko. The studio is currently in negotiations with Shia LaBeouf to play the younger Wall Street trader, in what is described as an updated version of the character Charlie Sheen played in the original film. The film was originally going to be named Money Never Sleeps, but that has been dropped.
As previously reported, Allan Loeb, writer of 21, wrote the most recent screenplay, which will follow Gordon Gekko’s character, who has just been released from prison after serving a 14-year sentence in jail for insider trading and securities fraud. Gekko embarks on the financial lecture circuit, after releasing a book called “Moral Hazzard,” and meets a young Wall Street hot shot, Jacob L. Moore. Moore’s mentor has just committed suicide, after his former company, KZI was destroyed. A trader named Brenton Woods
is behind the downfall of the company, and Moore seeks out the help of Gekko to get revenge. But in return for Gekko’s help, Moore must reunite Gekko with his estranged daughter, who he is engaged to.
I read an article today that researchers in Japan have discovered a positive correlation between higher amounts of lithium in tap/drinking water and reduced suicides. That’s the good news. The caveat is that it might prove to take many years of consuming lithium to get the effect. I prefer Scotch to lithium, but there has been no research on the effects of peat on suicide so I have no valid argument, other than that I’m still here … and intend to be, at least until the Scotch runs out.
You can drink Crazy Water, available from Mineral Wells TX, on the side - high lithium content:
http://www.famouswater.com/story.aspx
I tried some of the stronger variety after I was stopped for a look around Mineral Wells on a road trip. It made me feel a little spacey. I have tried some of the lower mineral content water since and was fine.
A lot of people from around there swear by it. They take their own jugs and fill up periodically. I don’t know exactly what they perceive as the benefit, perhaps a mellowing effect.
Given a choice between the two, I’m with you and will take the Scotch.
Suicide is one of those Japanese cultural things. How did it ever get established if they have naturally occuring lithium in their drinking water?
How did it ever get established if … Life is just one correlation after another. Sometimes it even makes sense.
“Faced with bottom-line competition from foreclosures and short sales, homebuilders in Las Vegas have reduced prices to the point that some are selling for less than $100 a square foot.
…
It was about 10 years ago that new-home prices in Las Vegas topped $100 a square foot and everybody was squawking about how the market had become more expensive than Phoenix, the most comparable city in the Southwest region. The bursting of the housing ‘bubble’ has brought prices back to those levels.”
Perhaps San Diego was the first to bubble, but it looks like other cities, including Vegas and Detroit, are beating San Diego in the race to the bottom.
That’s because Vegas and Detroit never should have been worth anything to begin to begin with. SD was/is overpriced too, but Vegas and Detroit were even more overpriced when you consider their inhospitable climates. Look, Vegas was founded the freaking mafia, yo. At least SD has some pretty cool professors in it.
“Look, Vegas was founded (by) the freaking mafia, yo.”
Au contraire… Sin City was settled by Mormons, long before Bugsy came around (”there is opposition in all things”).
History of Las Vegas
…
MORMON INFLUENCE
Mormon settlers from Salt Lake City traveled to Las Vegas to protect the Los Angeles-Salt Lake City mail route and in 1855 began building a 150-square-foot fort of sun-dried bricks made of clay soil and grass, a substance known as adobe.
The Mormons planted fruit trees, cultivated vegetables and mined lead for bullets at Potosi Mountain. Mormon pioneers abandoned the settlement in 1858, partly because of Indian raids. A portion of the “Mormon Fort” has withstood the ravages of time and is an historic site today near the intersection of Las Vegas Boulevard North and Washington Avenue. Scientists began an archeological dig on the site in November 1992.
Man, Vegas wasn’t Vegas yet then. I wonder what a Vegas condo would set you back if it were still run by Mormons.
History of Las Vegas
Lemme just set y’all straight on this.
The angel Macaroni appeared in the desert to Jebediah Mohalla and told him to build a palace, nay, many palaces along a highway in the desert. He was to place lights along the outside of the palaces so that wayward travelers would be attracted like moths to the tables therein.
Old Jeb was right successful in this venture, but the travelers who were attracted to the tables were right bored with just sitting there staring at each other under all the garish lighting.
That’s when one of the travelers, Giacomo “Antsy” Segal suggested that they play cards “or sumpin’”
Things soon started jumping when they realized they could play cards but they had no way of keeping track of who was winning.
This is when the state of Nevada legalized the “quickie” divorce. This meant that gamblers could now wager their spouses.
All this gambling and spousing and light bulb replacement meant that Vegas needed a large workforce.
People flocked to Vegas, and as long as the gamblers/spousers outnumbered the workers, everything was cool.
But then the housing bubble struck and suddenly there were more workers than gamblers or spousers and that made the Angel Macoroni sad, so he put a curse on Vegas - the dreaded Celine Dion curse - and that’s why Vegas is in so much trouble today.
Whew!
lavi d
Thanks, I can almost make out your voice tellin’ that “whopper”
Hey hwy!
You ever post a picture of that ‘49 Dodge anywhere?
Funny, lavi d. I knew there was reason we kept you around.
Thanks, I can almost make out your voice tellin’ that “whopper”
Me, too. And it was lovely, lavi.
All you need now is a cozy little campfire with crackly pine or juniper in it spitting up floaty gold sparks, and some bright stars above yer in the bowl of the night, and a fat golden labrador flopped there by the fire, listening and far*ting**, and some sleeping-bags that smell like a far*ty labrador laid out behind the campfire, and some beer. Lots of beer.
You could tell the story twice!
Then it would be Heaven upon earth.
**Labs far*t like mad. I swear, they are the far*tinest dogs ever created. It’s a mystery why.
Great story, lavi d!
“Cargill also criticized the federal government’s pumping hundreds of billions in taxpayer dollars into economic stimulus, saying similar measures only lengthened Japan’s recovery a decade ago.”
What recovery is he talking about?
Business News
Japan’s jobless rate at four-year high
Published: May 1, 2009 at 12:44 PM
TOKYO, May 1 (UPI) — The jobless rate in Japan in March rose to 4.8 percent, a four-year high, the government said Friday.
Statistics for March were the latest available.
The Ministry of Internal Affairs and Communications said Japan’s unemployment rate rose by a higher-than-expected 0.4 percentage point from February, the highest since March 1967, Kyodo reported.
“The center of the financial storm is housing”
I hope Tom Cargill realizes he just -destroyed- his credibility? Everybody knows it was AIG’s bonuses that caused the collapse when we defeated the Germans at Pearl Harbor.
I thought we lost to the Germans at Pearl Harbor.
“When I asked him directly what he planned to do for those who would find themselves in this situation if his five-year cap on Section 8 eligibility were to go through, his reply was that we would help these recipients become homeowners.”
How does this logic work?
- We have all these people who cannot afford to rent without subsidies.
- If we turn them all into homeowners, then we will be able to house them, and will also save the cost of subsidizing their rent!
That’s sort of like stuffing a rabid weasle down your pants and saying “Don’t worry, I turned him into underwear!”
The results are likely to be similar.
Wow. That, I believe, is likely to be the most dynamic phrase I shall encounter for at least a month.
I thank you. Sincerely.
The mental image is enough…
RE: That’s sort of like stuffing a rabid weasle down your pants and saying “Don’t worry, I turned him into underwear!”
The results are likely to be similar
+1
And prop up the housing market, too. It’s an air-tight plan, I like it. Psych.
They did that in my neighborhood. They gave a bunch of lifelong renters with no money subsidies to buy their rental homes. Of course, these single mothers with no money didn’t maintain them and from what I can see, have all gone into foreclosure. Gotta help them with their American Dream!
Did Bush ever hold a real job? We’ve got career freeloaders in government now, whole families of them who think money just appears in their bank account by magic and have no idea how hard it is to live on hourly wages.
Nope, Bush never held a real job.
I’ve got what I believe to be a fair challenge, in that I have no clue about the answer, nor any inclination at this hour to look it up. How many of the past six presidents and vice-presidents - twelve in all - held real jobs before their positions as P and VP?
This idea of turning renters into house owners was hardly limited to section 8. There were the cheerleaders at the U-T touting how good condo conversions were because it would create “affordable” housing for renters. Never mind that owning those converted condos might cost 3x what it cost to rent them. No one that rented was going to own, they just had to move. How many of the new owners ended up in foreclosure? What a waste, both the financial and the human cost.
What a waste. There has been so much affordable housing - and so many trees - destroyed to create all this so called “luxury” stuff. Put granite countertops in the apartment kitchen, designer basin crammed in beside the apartment toilet, triple the price - voila!
I checked out that casino’s website. They really do have rooms for $30/night (midweek). Maybe I’ll book a trip.
Adam,
You got my curiousity up so I checked and you can stay at the Palace Station for $20 bucks. You know just for O.J times sake?
Rio is $60. Wasn’t long ago it seems to me it was closer to $200-$300.
you can stay at the Palace Station for $20 bucks. Is that for a room with A/C/bed/sheets/bath/etc., or for sleeping in your RV in the parking lot?
There is a reason these places are cheap. The Palace Station is a dump. The Stratosphere is OK, but the nieghborhood around it is a dump. If you’ve got the $$$, stay at the Rio. But don’t expect free wireless internet - that’s not part of Vegas-style hospitality in most of the joints.
There is a reason these places are cheap. Oh, well, back to my RV in the parking lot!
How much is companionship, these nights?
It’s getting less expensive. The closest legal spa for us guys from LV is in a town called Pahrumph. There are web sites for legal brothels in NV.
Nevada and Rhode Island are the only states where it is not a crime to be a man.
said she and her colleagues are hearing of suicides on Wall Street that are not getting much attention…Their worlds are basically crumbling,’ she said. ‘Everything that they had hoped for and really seemed within their grasp over the last 20 years or so is ending.’ At the heart of it, she said, ‘there’s a disparity between who you want to be, who you thought you were and who people are telling you are today, and that hurts like hell.’”
That’s just awful. Those poor, suffering Wall-streeters…
BWAHAHAHAHAAHAH! *gasp gasp * BWAHAHAHAHAHA!…
My little tears are gonna stay snuggled cozily inside my tear-ducts while my mouth keeps on laughing loudly.
Why, with sad stories like this I could guffaw all day long, ‘cept then my head might pop, wasting my May Day beautifying dew bath as well as making eating dinner more difficult.
All I wanna know is, how many Wall-streeters/failed pig-men ARE offing themselves? There ought to be a website devoted to tabulating them, I think.
Flirt, speak gibberish, act mean spirited, mock the dead and depressed,etc., etc. You may have your fans, but you certainly have those that are less impressed.
but you certainly have those that are less impressed.
Then skip my posts, Sarah. It’s easy, and it’s not like you’re getting graded, right?
Don’t worry–my tears will stay cozily snuggled inside my tear-ducts in that case as well.
I’d rather have someone attempt to sell me something that I don’t need or is overpriced than laugh about dead loved ones. Before acting like you are better than others, perhaps you should practice it. As for whether you care about what others think, that is not my concern. More childish nonsense.
Sarah,
I don’t think anyone here is really ‘enjoying’ any of this? I know “I” am not. Truthfully, I’d have infinitely preferred none of this had ever happened to begin with.
But when you look at CEO’s and HF mgrs. penciling themselves in for monster bonuses based on fictitious profits with no basis in reality and then deciding they simply can’t carry on now that they’ve evaporated as mysteriously as they appeared, it’s almost as if all this occured in a vacuum from the start anyway?
I dislike most Realtors, brokers and Wall Street types. I don’t mind jokes about their intelligence, sleaziness, back-stabbing, etc. However, when someone commits suicide, not only were they going through extreme emotional turmoil, their family and friends suffer as well. There is a huge difference between laughing when someone fails in their objectives that you find objectionable, and laughing at their death. Also, to assume strangers in the real estate or Wall Street industry are killing themselves because they will make less is not fair. The stress of losing one’s job and facing bankruptcy, or other like circumstances, can cause people to go into deep depression and attempt suicide. It’s a chemical reaction that some cannot control (rather than a subjective reasoned decision that death is better than making less money). It’s sad rather than funny. I really don’t care if you are happy they are losing their jobs and facing bankruptcy (although I would be cautious to judge them based on profession alone), but laughing because of someone else’s severe depression and suicide, give me a break. I would expect better from the average Realtor/Wall Street person.
“The stress of losing one’s job and facing bankruptcy, or other like circumstances, can cause people to go into deep depression and attempt suicide. It’s a chemical reaction that some cannot control”
Sorry, I call BS on this. I’m a wee bit tired of people playing victim to “chemical reactions”. The “chemicals” made me do it, I’m not responsible.
“I would expect better from the average Realtor/Wall Street person.”
But you wouldn’t get it. They’d probably laugh all the day long if one of us committed suicide - or ignore it altogether.
Palmetto, my view of “responsibility” is probably different than yours. I have seen a lot of crazy stuff, and think anyone is capable of snapping or doing things that they don’t realize they are capable of given the right circumstances. Just because I don’t believe people are responsible for some horrible actions they take, I do not mean to imply they should not be stopped or controlled. For example, I believe most serial killers have uncontrollable urges, yet that doesn’t mean I don’t believe in the death penalty for them. I actually believe the criminal insane are more deserving of the death penalty in most circumstances because I see the death penalty not as punishment but as a preventative measure for people that can not control themselves. The right person and the right circumstances can turn anyone into a monster, even those viewed as saints. I think you underestimate the combination of nature and nuture in relation to the human condition.
CATFIGHT! Whoo-hoo, you GO, girls!
LOL, you dirty dirty man!
I agree. That was totally out of line.
( Olympiagal, do you, uh… have anything on REALTWHORES offing themselves? )
Totally out of line. Totally.
Yeah, the Global Financial System is crumbling, decent hard working people are being thrown into the street and I’m going to worry about someone whose sense of vanity is such that they’d rather be DEAD than like you & me?
WAY out of line! BAD Olygal, bad.
Totally. The other day someone, was it Fasty? Posted a link to an article on some Wall-streeters boo-hooing and it had some incredibly enraging quotes in it: some hedge-fund wife whining about how she had to sell some of her diamonds and hope her friends didn’t notice, and keep last season’s Versace handbag, and couldn’t have a full time maid anymore, etc….
When I was growing up I thought orange juice was for rich people. I remember when I got a hand-me down dress for Sunday and I felt like a princess because it only had one hole in it.
Nowadays I drink all the orange juice I want and possess many dresses without even one hole in them, but I remember. And I also know, right now, quite a few young couples around my age, good folks, ethical, work hard, went to college, followed the rules to be good citizens and earn the fabled ‘American Dream’, who are currently raising their precious little kiddies in McCrapshacks(either rented or mortgaged) with 3 feet of lawn and crappy neighbors and both of them working all day LONG because that’s all they could afford, thanks to the credit/housing bubble inflation and rampant craziness, WHICH STARTED WITH THE PIG-MEN AND THEIR HENCHMEN.
Sorry for the suicides?! F*ook, I’m sorry there aren’t MORE of ‘em!
Amen, Olympiagal –give em HELL!! (they deserve it… and a whole lot more).
I’m with Olympiagal too.
Well said, Olympiagal!
Thank you Olympiagal for having the courage to speak out what many are thinking but afraid to say. My wife and I wanted to buy land in OC back in 2001, but I wasn’t going to overpay and take a chance on losing our hard earned down payment, so we’ve been stuck in our tiny shack for 8+ years downwind from car painting shops, breathing in poisonous fumes that will probably shave years off of our lives thanks to the greed that overtook America. So everytime I hear of a suicide, it’s like music to my ears…I only feel sorry when the parent(s) doesn’t just off themselves (when innocent children are taken along for the ride)…but feel sorry for the greedy Piece of S#!@ who offs himelf? Please, I only wish there were many many more suicides each day and a blog site set up to track them. I only hope this lesson of greed is taught to future generations so it will never happen again. Wishful thinking.
She mocked them while they were alive too, it’s merely consistency to keep treating them the same.
Is suicide such a noble act it erases all your sins? How about they repent and stick around to deal with the results of their actions, maybe even help clean up the mess.
Suicide is a selfish act.
climber,
Well exactly. And yes, there ‘is’ something to be said for “consistency”. It’s not like anyone here was worshipping them ( like Madoff’s clients ) and then turning on him when the (highly) suspicious returns evaporate into thin air?
Oh… those poooor people, forced to live on a budget like, p-p-p-peons! The Horror! What will their precious spoiled children think? What will their snotty, elitist friends think? They may have to downsize and live like *gasp* average working-class people (like me)!
Yeah, I’d rather off myself than face that.
Sarah,
This is really repeat of history. Look back at every serious financial crisis and you see that bankers took the most blames and during and after the GD they were social pariah for decades afterward. When one of these bankers killed themselves, the J6P got their vengeance, so to speak, and little sympathy is found for them, because that’s really the only way for the public to vent. However, of course public is keen-deep in this whole mess too, they just don’t realize or for the most part want to admit it. After all it is easier to blame someone else for the mess than looking at oneself in the mirror.
Having said that though, not every suicide related to the financial crisis is a hedge fund manager or a banker. I mean some of these guys were victims of fraud. Some of them just found them in wrong place at the wrong time and their complicity in this mess isn’t all that well defined or known, but again with a debacle of this magnitude it’s shoot first, ask question later, right? Of course that’s not right, but given the environment today that is expected.
Yes. You are too rational Cougar. I especially agree with the villainization of others to deflect one’s introspection regarding their own actions and motives. We are all subject to human condition. The difference between the haves and the have nots is often happenstance, but for those that felt screwed they often prefer to believe it’s good v. evil. I am not like them, and they are not like me. For I am special and they are nothing.
Sarah - at the clear risk of getting into the middle of a type of contest I dislike, if you have followed Ben’s blog for any length of time you know that gallows humor and strong, quick wit is a treasured part of the banter here and that Oly is one of our most unique posters ever. While I regret that you’re offended and I don’t take on any of your points, you have the wonderful freedom to read or not read. or reply to the posts - that is one of the qualities that make the HBB “home” for me and many others. Sorry you didn’t like it (to be presumptive, I admit) - there are a boatload of blogs out there that may make you happier or less offended.
I couldn’t disagree more with your post. What makes great blogs great is when people consider different views. Telling people with opposing views to just leave would defeat the whole purpose. I am not the type of person that reads something I find offensive or objectionable, but keeps quiet about it. I hope you do not do that in your life. I decline your invitation to leave because I disagree with one of your favorites. I do admit though, if the blog follows your advice and becomes one of small group of people with the same views and positions that tells other with valid points albeit different than your own to leave, I will leave on my own accord. More because it would have nothing to offer me than because of threats. I am am free to have my own interpretation of what is catagorized as wit.
Good post, Chip, but I think it’s fair for people to voice their opinion when they don’t appreciate certain posts.
It’s hard to simply “ignore” posts by a user, as most posters here do have valuable things to say much of the time, but from time to time do go “off the reservation” a bit. It’d be nice if people would simply stay “civil”, but from time to time the community here needs to keep everyone in check (not saying necessarily that OlyGal is anymore off the reservation here than she usually is…I really don’t care to get involved in this one).
(and OlyGal, by that I mean that you’re normally one of the more quirky and unique personalities here..nothing more).
Jeeze, drumiinj, I thought you were my friend. And, unlike whassername, I actually cared what you thought.
But look, same thing obtains: if you don’t like my posts, then don’t read them.
Go ahead and SKIP them. Huh huh huh?
How hard can it freakin’ be?
Less dope, more skipping!
Oly, I tried to be clear that I wasn’t dissing you at all. My point was that I was making no comment on whether I objected to your original post or not (trying to do it in a playful way - clearly I failed), and I was encouraging Sarah to speak up if she finds something anyone posts - including me - objectionable.
We’re neighbors…sort of. I mean to start no quarrels.
Thank you for being a good person drumminj. As for Oly’s statement that she only cares about what ppl that agree with her think, so much for the wit part. My daughters had the same attitude before they were 7.
They are shooting themselves first aren’t they?
Sorry, just kidding, I wanted in on this round as well.
Better to be middle class or dead???Hmmm, tough choice.
Oly, I like this side of you. OK, here’s the plan: You scour your sources looking for stories of people like this (people who kill themselves the minute they are cut off from fleecing the stupid), send me pictures of them, and I will draw mustaches, horns, black teeth, and the like on their faces. I’ll post the pictures on Picasa, K?
HAhahaahahHA!
Awesome! Let’s do it, V.
Here’s my e-dress:
BigVHBB at gmail ddot kkom
Bad girls both of you…
Dang, I made a super good duck sound, but it vanished into the ether.
I have Photoshop and know how to use it
Unless of course, it somehow makes fun of women in some way…then you’re totally against it. Right Big V?
“Cargill also criticized the federal government’s pumping hundreds of billions in taxpayer dollars into economic stimulus, saying similar measures only lengthened Japan’s recovery a decade ago.”
Sorry Tim, but team Barry will keep right on pumping money and pimping programs that are bound to fail and gum up the works.
The gov’t sure is going toe to toe with Mr. Market this spring. How long can intervention of this intensity last?
I personally think they have made a strategic blunder. By going to such lengths to plant visions of green shoots into the sheeples’ minds, while pumping in ginormous liquidity injections to keep Mr Market dancing at the end of the Fed’s puppet strings, they are setting themselves up for another leg down at some point which may turn out to be uncomfortably proximate to the 2012 election season.
As an illustration of how long a distorted market can keep crashing, I give you Japan (20 years — 1989 through the present).
,i> I give you Japan (20 years — 1989 through the present).
No, thanks. Don’t want it.
Oooops, sorry, PB.
I did the italics wrong.
But I STILL don’t want it… Japan (20 years — 1989 through the present).
Oly — It is quite ironic, as I am pretty sure the PTB don’t want it either, that the attempt to reflate the bubble is quite likely to put the economy into a stagflationary purgatory akin to the 1970s or worse. And the 1970s ended were followed by three or so years of severe economic pain (1980-1982). I don’t think we have evolved to the stage yet where a baptism of high interest rate fire could right the economy’s course… need to endure purgatory for a few years before baptism by fire is even an option.
The higher education bubble predicted by so many here is finally making its MSM debut:
http://www.bloomberg.com/apps/news?pid=20601109&sid=aoglHAxZffTI&refer=home
First, great link. Thank you.
I missed this (not having a kid anywhere old enough for college):
Today is the deadline that most schools set to receive a decision from accepted applicants.
D-Day is here! Schools that lack a *large* back up list are going to be in trouble. Heck, how will mommy and daddy pay tuition without the HELOC?
Oh, what is the author’s HBB username? By Yalman Onaran
The article read as if one of us wrote it.
Got Popcorn?
Neil
When we have kids, if tuition is still as high as they are now, we’ll present a list to him/her containing the name of about 25 colleges that might be considered worth the tuition they charge (e.g. Harvard, Yale, MIT, Princeton, etc.), and tell them, “if you go to one of these schools, we’ll pay the tuition; otherwise it’s Rutgers for you!”
No way are H, Y, MIT & P worth the tuition they charge. Send your kid to Rutgers regardless.
And Rutgers just sounds cooler. That and the fact that it was named after that guy from The Hitcher.
Community colleges are huge winners in this category. The first 2 years at most any major Us are taught by grad students anyhow. At a community college you’re likely to get an instructor who has had a real job at one point in their life.
The best TA I ever had was a nuclear engineer who got out of the Navy and was back in school. He warned us there were no jobs on the horizon for Nuclear engineering and to look for something else. Meanwhile the U of Michigan School of Public health fleeced my mom out of tuition for years and then dumped her into a dead job market.
Okay, here’s Slim checking in with a True Confession:
Many have been the times that I’ve mentioned that I have a degree from the University of Michigan. It was in economics, and that major has proven useful when sorting out the BS thrown at us by big business, government, the MSM, the Trilateral Commission, the next door neighbor’s poodle, etc.
However (and I knew you’d wake back up when I said that word), I came out of the U-M with very few salable skills. As, in, the sort of thing that would motivate an employer to hire me. And I really struggled in my twenties because of that.
Things got better in my thirties, as I had acquired some job experience. Then I went into business, and it was back to square one. I had no idea how to do that.
Pardon me for, ahem, borrowing one of Robert Kiyosaki’s lines, but the problem lay in our educational system, which is focused on teaching people to be employees. I’m now of the mind that every K-12 school in this country should be integrating business skills into the curriculum. Even if it’s just having Junior Achievement coming in to mentor the kids.
Okay, here we are at now. I’ve been a graphic designer since the mid-1990s, and I’m adding my youthful passion for photography into the mix. I learned the basics of both fields back during my high school days. (Here’s a big shout-out to the West Chester Area School District back in Pennsylvania.)
I learned the business schools to go with by, well, being in business. And by reading books, websites, magazines articles, and just about anything else that had words on it. I’ve also taken short courses, gone through mentorship, and all sorts of other things.
For the most part, I’ve been able to attain my business knowledge by staying away from Michigan and other universities. And why might that be? Because, for what they offer, they charge too much.
Thanks for sharing that, AZ.
Just like Ben’s blog here. How much have we all learned from this blog…all free (excepting any **voluntary** donations).
If our kids want to go to college, either they will go the CC-to-state university route, or they will have to be so good that the higher-end universities offer to pay for them.
“When we have kids, if tuition is still as high as they are now, we’ll present a list to him/her containing the name of about 25 colleges that might be considered worth the tuition they charge (e.g. Harvard, Yale, MIT, Princeton, etc.), and tell them, “if you go to one of these schools, we’ll pay the tuition; otherwise it’s Rutgers for you!””
Tell them “if one of these schools offers you a scholarship, we’ll let you go there; otherwise, it’s Rutgers for you”. Take it from somebody who went to one of the big-bucks Top 50 schools (Case Western) - unless they give you a very large scholarship, the cost-to-benefit ratio definitely does not work out in your favor.
If your kids are sharp and intellectually ambitious, try to aim them towards one of the state schools’ honors programs. Those seem like the ideal combo of intellectual rigor and reasonable tuition costs.
I went to CWRU myself; and trust me, it would NOT be on the list. Of course, they do hand out 100% scholarships on 1500 SAT and top 5% HS ranking.
I think the top schools with name recognition are not worth the tuition because of what you learn, but because of the career opportunities it opens for you and because of the people you meet and befriend there.
Let me see, I think the schools would include, off of top of my head: the 8 Ivys (maybe excluding UPenn), MIT, Cal Tech., Stanford, Chicago, Duke, Northwestern, and top five liberal art colleges (Smith, etc.).
I think if my kids can get into these schools, denying them the chance to go there could be denying them the chance to excel in life.
I actually toured CalTech and was unimpressed because they seemed to have an attitude of “well, MAYBE you’ll be good enough for us.” They talked about their frosh dropout rate as though they were proud of it.
Contrast that with Harvey Mudd, one of the Claremont schools with a funny name and a focus on the hard sciences. They stated that if you went there, they’d do everything they could to help you pass. They showed off their hands-on projects in science and engineering. And, quite honestly, the unicycle fixation was quirky in a really good way.
As was the “employment upon graduation” rate– topping 90%.
They’re so small, though, that they have virtually no scholarships to speak of. And since I ended up not going into engineering after all, it’s probably just as well I didn’t go there. (I went to a school five times as big– all of 4000 students.)
I wonder what “out-of-country” tuition goes for these days?
Is Fox News “truth monger” a degree program in Australia?
“…Independent colleges that lack a national name or must-have majors are hardest hit. Many gorged on debt for construction, technology and creature comforts. Now, as endowments tumble and bills mount, they’re struggling to attract cash-strapped families who are navigating their own financial woes.”
“This building is always empty,” says Raya Alazzouni, a sophomore from Saudi Arabia who’s studying graphic design and taking courses in the management school.
Oil @ $147.00 a barrel…gasoline @ $4.60 per gallon = supply & demand:
BWAHAHHAHAHAHHAHAHHAHHAHAHAHHHHHHHHHHHHH!!!
The best course for the $ I ever spent was a course in basic auto mechanics from the local school district, available for about $10 to residents of the district, when I was a college senior. Learned some hands-on basics of car care. It has saved me many thousands of $ in the decades since.
I took three courses at Pasadena City College in the mid-’70s one semester for a total of $5 in fees. One in FORTRAN, which I used in my first job (and taught much better than at another local school where I had taken it earlier); one in investing, which at least got the ball rolling even though I had no money; and, one in income tax preparation which I still use today. Real courses for real people.
Well, I wish I’d had that available!
Sarah Lawrence College in Bronxville, New York, the costliest U.S. school, charged $53,166 last year….Tim and Laura McNamara are weighing whether to send their son, Daniel, to Gettysburg College, with its $48,050 annual tab for tuition and expenses. The 2,600- student liberal arts school next to the Civil War battlefield in Pennsylvania is his top choice….For Carl Erickson and Mary O’Neill of Grand Rapids, Michigan, the answer to the “Is it worth it?” question is yes. They’ll pay the extra $43,000 a year for their daughter, Caroline, to attend Northwestern University…
Wow, those are pretty astounding amounts of money.
Wow, those are pretty astounding amounts of money.
Especially considering the paltry starting salaries being offered to most college graduates. Better hope these families come from money, or that there’s a Bush or Kennedy in those family trees, or little Danny and Caroline are going to paying on those student loans for a looooong time.
OK, I’ll admit it. I have never heard of Gettysburg College or Kalamazoo College.
http://www.redorbit.com/news/education/1515955/which_college_grads_earn_the_most/
“Yale University topped the list, which ranked in the 90th percentile of midcareer salaries of alumni from each institution [Employees in this range include CEOs, CFOs, other C-level executives, stock traders, and hedge fund managers]. Top earners with Yale degrees typically earned $326,000 a year compared with the best-paid graduates of, say, Kent State University, a respectable public university in Ohio, who earned $124,000, on average.”
Get $200K a year extra salary for 25 years by paying $40K a year for 4 years? Yeah I’d say the extra tuition is worth it.
Families Hurting
With families hurting, Drinan says it will be difficult for Simmons and its rivals to entice more students.
“Every college and university in America is worried about that,” she says. “Higher education needs to pay attention to its cost structure, but we have to have the facilities that are necessary to house and teach our students.”
Hmm, my wife and I have always believed in the usefulness of education in employment and generally life. We took pains to payoff our Florida Prepaid College Plan. I have two sons - 15 and 12 - and I will be hugely pi$$ed if The State of Florida cancels and pays out.
That being said, my wife and I went to some excellent state schools. I went to a state graduate school. So, exactly how are these little liberal arts schools that charge all of that money so much better?
Ans: They aren’t. Most of the supposed differences in undergrad schools do not exist. The differences are in the graduate and professional schools. Those do exist.
BTW, Physics is a mostly state school thing.
Roidy
I love the part about the business school hiring consultants from Deloitte to help them navigate their financial troubles. I mean, don’t they have any internal expertise in such things? Not a great recommendation for the quality of the business education one might receive there.
Many if not most 4 year degrees are worthless anyhow. The rest cost far more than their economic value or the difficulty associated with assimilating the information.
It should be dirt cheap to teach literature, calculus and most of the basics. The MBA programs are a real hoot. Two years of JA beats what a lot of MBAs learn, the rest is just simple math and logic, which most MBAs never demonstrate anyhow. The days of working up from the mailroom need to be reinvented.
College is one of the biggest rip offs ever. I was 5 years older than my brother. Granted the kid was really smart, but I taught him everything I was learning in class and before he was out of high school he had a UNIX computer system set up in his room and was designing and building plug in boards to do high speed data capture and storage.
Chemistry you can learn from a book and my undergrad experiments you could do in your garage with a scale, a few vials of chemicals and some cheap glassware. In fact my garage saw much such activity long before college.
College is one of the biggest rip offs ever.
For most private colleges, esp. snotty Ivy League universities I would agree. However, there are still some fine community and state colleges that can give you an education as good as their overpriced brothers for much cheaper. There are also other benefits to being in college and living among other students. Plus, some people just don’t learn as well on their own outside a classroom setting, especially when they are starting out from scratch. That said, I would not mortgage my future just to get a sheepskin from a big name university.
While I don’t disagree that there are a (small) number of people out there so focused on a career or hobby at 18 years old that they can learn such things on their own, most of us need the help and knowledge of others along with the discipline (however little) college provides.
I’ll also say that most self-taught programmers (85%) are great programmers, but not very good business people.
You are free to disagree, but theoretically, if you were to prove to me that you are good at figuring out what people want (and not at simply designing and maintainaing a good system they should want) then i’d probably still put you in that 15% category.
Why would I say that? Because in your dismissal of college, you rationalize your singular experience to “most people”.
I’m just sayin’.
I think you’ve missed some of my previous posts. I’m a huge fan of community colleges and my EE from U of Michigan has been worth the expense ($2400/ year for years 1 &2 and a bit more for the others). My mom got an MPH from the U of Michigan that cost more but was worth far less.
People need to put their education through a cost benefit analysis. Too many people just “go to college”.
Speaking as someone who lives near the University of Arizona, I see examples of the “go to college” syndrome every day.
People need to put their education through a cost benefit analysis. Too many people just “go to college”. This is true. However, the world is changing at an ever-increasing pace, so what might have passed a cost-benefit analysis when you are 18 may be quite different when you are 22, and so forth.
“Enrollment on upswing at Glendale Community College
In spring 2008, GCC reported a student drop of more than 3 percent. This year, enrollment is up by about 10 percent at the main and north campuses combined.”
In a totally unrelated story:
“Students at Arizona’s three state universities will see tuition surcharges tacked onto their bills for the first time this fall.”
Prices at ASU up 15% next year, and up close to 100% over the last 10 years…. meanwhile, more people are heading for communiy college.
I doubt these are related.
Up over 100%, in the last ten years. What were the official inflation numbers, 2.75-3.50%/yr? How much was RE appreciation during that time? Mighty frothy decade.
“I’m not lowering price, but I will take less money”. Kelly Porter, you are an official SV has-been. Go on with your bad self.
“He’s not lowering the price but will consider less”
HA-HA-HA-HA-HA
When will the deniers-of-the-current-real-world just stop it?
”’I will walk away and go rent somewhere,’ Carrio said.”
Eeyore: “Another “bitter-rent” oh, joy”
“I will walk away and go rent somewhere”
And maybe they won’t. I just moved from one apartment complex to another, and the new place ran a credit check on me.
Just thought I’d repost a few things I’ve said about Bulgaria over the past year. Note that the “regional city” I referred to in June was Blagoevgrad (-20.5%):
June 08:
I am preaching to the choir here but this is a global credit bubble…In a country where the average salary is about $3,000 USD per year (yes, that’s 3,000, I’m not missing a zero) house prices in some of the regional cities are in excess of $200,000USD for unfinished apartments, and even more than that in the capital.
Now, I like Bulgaria, but I go in with eyes open. This is essentially a semi-failed state, controlled by crime syndicates, with no real rule of law, widespread corruption that impacts daily life, with a neglected infrastructure that at best (and I’m not exaggerating here, I’ve lived and traveled extensively in BG) rivals the dilapidated sections of Chicago or Detroit, and they are asking for prices that you can see in modern, clean, western cities.
My wife, absolutely amazed, flabbergasted even, told the real estate agent, “Do you know we could buy a bigger condo than what you are selling here 100 meters from the water on Maui for that much?” And you can. It is literally insane what is happening, and anybody who thinks that this contagion is over, or that it will end well, or that there is going to be some safe haven someplace, is deluded.
Feb 09 ===
“It turns out Western European banks may also be insolvent as a result of exposure to Eastern Europe…”
I’ve been waiting for this shoe to drop for a while. Europe has been pointing the finger at our sub-prime debacle and smugly pontificating about our short sightedness. Well, some of us have been pointing the finger at housing prices in Eastern Europe, financed by European banks like Raiffeisenbank, EuroBank, Piraeus Bank, Societe Generale Expressbank, and Alianz Bank, and doing some pontificating of our own. So… if Americans were stupid and irresponsible for making $400,000 home loans to janitors making a household income of $40,000, what does it make Europeans lending similar amounts to people with a household income of $4,000? In countries with no credit rating systems? To people with no history of credit?
The other part of the story I am waiting to hear about is the massive infusion of laundered organized crime money in creating the E. European real estate bubble. But I guess complex story lines are too difficult for most people to untangle, so I will have to settle for “It’s all America’s fault.”
April 08 ====
(In response to somebody’s pro-capitalist, pro-market rant)
How about we go with the bulgarian model? Pure, unadulterated, unfettered capitalism — a free marketeers’ dream. No more social safety net there… they even instituted a flat tax! Here are the results so far to this great experiment:
- The roads are completely destroyed.
- There is a culture of lawlesness fed by money talks bs walks.
- EU just cut off funding due to corruption
- Seaside is completely overbuilt in the mother of condo bubbles (think dubai levels of construction), causing a glut of condos and destruction of sensitive coastal habitat
- Unfettered building in national parks all across the country
- Police corruption so widespread it is standard practice to simply hand the police your license and a 20 euro note when they pull you over
- A generation of hopeless, cynical youth who have emigrated out of the country rather than stay
- Trafficking of humans to western europe. I mean literally kidnapping young girls and sending them west. This is really happening.
Seriously, republicans — I’m not joking. If you want to see the end result of free market capitalism go to Bulgaria now. When I first started going to that country at the end of communism, that after years of decline, it was 10X better off than it is now. People had hope. Now they have none, just a gun toting class of BMW and Mercedes driving criminals (oops, I mean businessmen) who act as if the country belongs to them, because it does.
The political spectrum has been seriously misrepresented.
The left axis = 0 government which equals anarchy which is what you’re seeing in Bulgaria - that’s not captialism
The right axis = 100 % government like the Nazi state, Communist Russia or such
Somewhere between 33% and 66% is a tolerable level of government intervention and a set of more or less enforced laws to protect life limb and property.
The corruption index also goes from 0% to 100%. A 100% corrupt government that doesn’t exist is not much better than a corrupt government that controls 100% of everything. A 100% honest government that doesn’t exist isn’t much use either. A 100% honest government that controls 100% of everything likely won’t stay honest for long.
Such is the struggle of life. The balance of individual freedom, access to resources and the protection of these things. If it were easy most humans would live in prosperity and happiness most of the time. It’s not easy and most people live in squalor most of the time.
Wow. Very interesting post.
RE: If you want to see the end result of free market capitalism go to Bulgaria now.
My “mail-order” bride website declares Bulgarian women far, far superior (and easier to import to the US) than a mercenary, hard-hearted, Russian or Ukrainian wench!
But now, (wiping a tear) I’m not so sure…
Doubt invades…
My dreams of a “BB” (Bulgarian Beauty) are crushed!
Somehow I get the feeling that you’re not even joking, 74.
Hmmmm. Endofempire, I was going to thank you for your eyes-on perspective of an actual situation which I would otherwise be completely unaware of, but then I started crying from depression instead.
But, when I stop crying, I will thank you at that time, okay? Okay.
Wow. The situation you present sounds just so wretched…
I can’t really wrap my head around it.
Seriously, republicans — I’m not joking. If you want to see the end result of free market capitalism go to Bulgaria now.
Great post.
I’m tired of all the John Galt-wannabes telling us how great capitalism can be without any pesky oversight (”Why, of course corporations can police themselves! It’ll be great!”), and you’ve offered us a pretty nice refutation in a real world case — and real world examples are suspiciously absent from all the free marketeers see-no-evil proselytizing.
If you want to see the end result of free market capitalism go to Bulgaria now. What you described looks like mere anarchy to me — i.e., the strongest hands lording it over the weak, their only restraint being other strong hands, no other laws, no common good being promoted or even considered.
Then there’s New Mexico: see hosted DOT ap DOT org: May 1, 5:27 PM EDT “COLUMBUS, N.M. (AP) — This dusty little border town with almost no visible means of support has been seeing something of a boom in the past year: Brand-new Lincoln Navigators and Cadillac Escalades with flashy hubcaps are parked just off the bleak main drag. Homes are selling quickly, sometimes for cash. The source of this sudden wealth?… local law enforcement authorities say that’s not their business, it’s the federal government’s. And townspeople don’t seem to care either way.” That’s how it gets started.
I’m thinking this (drug money) is abundant in San Diego as well.
“What caused the collective madness that saw an acre of land in Ballsbridge, the exclusive Dublin suburb, go for $132 million an acre just a year or so ago?
That is pretty amazing…
BULLETIN
CHRYSLER POSTS APRIL U.S. SALES SKID OF 48%; FORD, GM SALES DOWN ABOUT ONE-THIRD
MARK HULBERT
That bullish bandwagon
Commentary: Some sentiment measures showing too much optimism
By Mark Hulbert, MarketWatch
Last update: 12:25 a.m. EDT May 1, 2009
ANNANDALE, Va. (MarketWatch) - Bear-market rally? Or major new bull market?
One of the distinguishing characteristics of the former is an excessive eagerness to jump on the bullish bandwagon. At the beginnings of the latter, in contrast, advisers are more reticent — turning bullish more slowly and begrudgingly.
…
Because it has been 52 calendar days since the March 9 market low, I was especially interested in where these four different sentiment measures stood 52 days into those prior bull markets.
Consider first the picture painted by the HSNSI. This sentiment index grew by an average of 29.3 percentage points during the first 52 calendar days of prior bull markets. Since March 9, in contrast, it has jumped by more than 45 percentage points — about one-and-a-half times as much.
A similar story is being painted by the AAII data. The proportion of the organization’s members who report that they are bullish (as a percentage of those who say they are either bullish or bearish) is 24 percentage points higher now than at the early March low. The average gain over the first 52 days of prior bull markets, in contrast, is just 9.8 percentage points — or less than half as much.
To be sure, the other two sentiment measures I analyzed are telling a different story. Both the Investors Intelligence data and the VIX are suggesting that the increase in bullishness since March 9 is in line with the averages seen during the first 52 days of prior bull markets.
Still, it is worrisome that two out of four sentiment measures I analyzed are showing increases in bullish sentiment since the March 9 low that are markedly higher than the typical experience at the beginnings of prior bull markets.
The bottom line? It is difficult, but not impossible, to argue that we are in a new bull market. It is more likely that we’re in a bear-market rally.
End of Story
Mark Hulbert is the founder of Hulbert Financial Digest in Annandale, Va. He has been tracking the advice of more than 160 financial newsletters since 1980.
Thanks PB. Hulbert is pretty good though sometimes wrong. Certainly I am on his side this time, as I am still waiting for the Dow to reach the inflation-adjusted equivalent of its 1974 low. I’d been saying that number would be about 4000, but 3000 is really more like it. Oh well, if it gets below 5000 I’ll probably be buying stocks like every other fool.
Re the House legislation to forbid 100% securitization of mortgage loans. Full text says the loan originator would be required to retain at least 5% of the default risk. Yup, that COULD have prevented some of what happened. But at this point it is ridiculous. Nobody is buying mortgage-backed securities at face value anyhow. How much securitization has taken place in recent months? I guess very little (although I don’t actually know). What I do know is that the deluge of postcards I used to get, offering to buy (translation: steal) my mortgage notes, has absolutely and completely dried up.
Perhaps the hope is to restart some securitization to get some looser standards again, and stop the crash in its tracks…
Of couse, no one will buy any bonds backed by mortgages (unless there is an explicit government guarantee like GSE), until house prices stop falling. Even then, they will be a lot more careful about the lending standards of the loans in the security.
Well, there goes your competition, az_lender. Tee hee.
Then maybe now is the time to get the law passed while the bank lobby is distracted on other issues.
How would it impact your business? I recall that you keep 100% of your loans because you’re confident in the quality of your work.
If you needed to sell out for some kind of emergency or something would the 5% requirement be an undue burden?
Boob.
Tube.
tube?
You makin’ fun of me? Or is what I had the other night contagious?
achoo.
I usually pay attention to the type of boob that has a twin.
I have always wondered why these kinds of sweepstakes don’t also pay the taxes for you. Well, I know why, but it just seems kind of silly to give away a prize that no winner can keep.
More sickening is Extreme Makeover. They design multimillion dollar houses for people often with little means that are specific to one’s own needs (i.e., they cannot afford to keep it up, and the market is very limited).
EM was in Tucson earlier this year. There was more than a little whispering about whether their rapid building schedule led to some corner cutting.
“Let’s be perfectly clear. Mozilo went overboard pushing risky mortgages. He should be held accountable. But where on earth was McCollum — in fact, any legal and financial regulator — all those years when mortgages were approved and handed out to anyone who could scrawl an X on a signature line and, presumably, did not drool too much.”
Yep, that’s the question I’ve been asking, where’s McCollum been all this time?
“Let’s be perfectly clear. Mozilo went overboard pushing risky mortgages. He should be held accountable. But where on earth was McCollum — in fact, any legal and financial regulator — all those years when mortgages were approved and handed out to anyone who could scrawl an X on a signature line and, presumably, did not drool too much.”
Too busy getting contributions for their next election campaign from the people they should have been regulating? Was there any state AG that took any sort of regulatory action when it would have been remotely helpful? Is that the sound of crickets I hear? Or maybe they didn’t want the Spitzer treatment.
telegraph dot co dot uk
Michael Douglas returns to a post sub-prime Wall Street
The Hollywood star is to reprise his role as Gordon Gekko, the ruthless corporate raider whose rise and fall came to symbolise Eighties excess.
By Anita Singh Showbusiness Editor
Last Updated: 6:51PM BST 29 Apr 2009
Belt and braces approach: Michael Douglas, left, is reprise his role as infamous Wall Street player Gordon Gekko in the 1980s film of the same name. His co-star in the 1987 film, Charlie Sheen, is pictured on the right. Photo: 20thC.Fox/Everett / Rex Features
A sequel to Stone’s 1987 original has long been on the cards, but the meltdown of the world’s financial markets has given the scriptwriters a wealth of material.
“We need to keep the storyline under wraps, but it’s literally ripped from today’s headlines,” said a spokesman for movie studio 20th Century Fox.
Douglas won an Oscar for his performance as Gekko, whose declaration that “lunch is for wimps” became a catchphrase in the City. The last film ended with Gekko facing prison for insider trading, but the sequel finds him back in business two decades on.
Douglas, 64, described the returning character as “a great, old-fashioned villain” whose moral compass remained the same: “I don’t think he’s much different. He’s just had more time to think about what to do.”
Stanley Weiser, screenwriter of the original film, has complained that real-life traders see Gekko as a hero rather than villain. “After so many encounters with Gekko admirers or wannabes I wish I could go back and rewrite the greed line to this: ‘Greed is good. But I’ve never seen a Brinks truck pull up to a cemetery,’” he said last year. “If Oliver Stone and I had a nickel for every time someone uttered the words ‘greed is good’ we could have bought up the remains of Lehman Brothers.“
Did the Fed declare a truce in the War on Savers and I didn’t hear about it?
The upside of the down economy
By Judy Martel • Bankrate dot com
Financial news has been brutal. Stocks are down, unemployment is up, banks are failing and the housing market is still smoldering after the crash. In the past two years, those who continued to play by the old fiscal rules — buying a home instead of renting, investing in the stock market for growth and fixed income for a safe haven — are now left feeling as if they’re wandering in the desert without a map. The old laws don’t seem to apply anymore, and guidelines for a shifting economy remain teasingly mirage-like.
…
Is there any upside to this recession? It may not seem like it if you’ve been laid off, lost your home or are living paycheck to paycheck, but there are some encouraging trends that could prove more sustainable than the credit-fueled house of economic cards we indulged in before the recession. Mostly they involve the ever-popular concepts of financial prudence and budgeting.
Save more
If you’re looking for a silver lining in the recession, consider that Americans’ savings rate has increased in the past couple of years.
In 2005, the savings rate dropped into negative numbers for the first time since the Depression, meaning Americans spent more than they earned and relied on leverage to make up the difference.
But the latest statistics from the U.S. Bureau of Economic Analysis indicate that savings increased to nearly 3 percent by the end of 2008. While some economists dispute whether the numbers factor in all forms of income, the upward trend seems to suggest that we’re moving in the right direction, at least.
If you’re not in the habit of saving, how can you get started? Ronald T. Wilcox, professor of business administration at the University of Virginia and author of “Whatever Happened to Thrift?” says that if you ask the average person if he can save more, the answer is typically no. But one way that has proven effective, according to Wilcox, is to immediately channel a pay raise (assuming you get one) into your 401(k).
People will generally stick with that tactic, Wilcox says, because they never see the money. It’s a psychological trick, to be sure, but one that works. This, of course, is also a good idea if you’ve never saved at all. Immediately sign up for your company retirement plan so you never actually get the money in hand. You’ll sock away a nest egg without even thinking about it.
Wilcox also sees a sustainable lesson for the future in this exercise: If people save and learn to live within their means from this recession, we’ll be in a much more stable situation and less reliant on credit when the economy improves.
“Lack of savings made for very fragile consumption,” he says. The down ticks in the economy are more severe when people are overleveraged. “Once we’re back in reasonable economic times, it won’t be quite as frail,” says Wilcox.
New lessons to live by
1. Save more.
2. Learn to rely less on credit.
3. Buy goods and services on sale.
4. Invest in equities on sale.
5. Rediscover your career passion.
6. Re-examine your relationship with money.
From Atlantic City, NJ: Talk about bad business plans– and bad timing. The new glossy magazine covering the Atlantic City scene, The Boardwalk Journal, put out its inaugural issue Feb. 1, and, I believe, was supposed to have No. 2 out today. Just checked its web site– nada. It still has up the inaugural issue with The Donald on the cover. I’m following this because the pedophile realtor who ripped me off– and at whom I’ve been sniping on “Rate My Realtor” sites all over the Internet– is The Journal’s in-house real estate expert. Looks like this mag is going to fold after just one issue. Good.
It’s Friday and failed-bank clearing time. Check this week’s list.
Been looking at several places and all I can say is there is a lot of BS out there. BUYER BEWARE. The games these people are playing. In many areas the prices look good…until you check the county assessor’s public records. Then you see that they are STILL asking for 20% more than 2005/2006 prices in many cases. And then there are the games they play with $ per square foot. I have seen 20 listing so far that had a low cost per sqft. Made me think it was a deal. But then I started looking at comps and found that the sqft was a lot lower everywhere else in the neighborhood. Hmmm…this is a track. How can the sqft be off by 2000 on every other sale. Without fail it was an unfinished basement that was counted into the SQFT calculation to make the $ per sqft look low.
And that doesn’t even consider the crap load of short sales, which are a serious waste of time. Look, if someone is boning the lender, do you really even care what their price is? After all, in almost every case the lender has no idea the place is even for sale. They aren’t obligated to take the price some dip with no stake in the game listed it at. Big waste of time. And this is just the obvious crap. Imagine the stuff you can’t see on the surface?
Be careful people. A lot of games are being played and you can waste a lot of time and money with these assholes. It’s the wild west all over again.
Two comments:
- Get the sales history going back to at least the late 90’s. Prices well above those levels are cause for concern.
- Another technique for boosting square footage and reducing the apparent cost per square foot is to include the square footage of balconies in the total square footage. Take a tape measure and measure the unit if necessary.
Hey Greg, I have been checking all the sales history using the property tax assessor sites, but thanks for the suggestion. But you really caught me on the balcony scam! Hadn’t thought of that one.
Damn.
I would add one more thing to my previous post. I think it has been an excellent idea to go through the process of looking. You really need to educate yourself about the markets you are interested in, and learn the games that are being played. Otherwise they will clean your clock.
Start early and you will be way ahead of the game when you really decide to buy.
Considering how all them green shoots are growing up and how confident them consumers are getting, it is surprising that cars are not selling any better.
Financial Times
US car sales dive as problems mount
By Bernard Simon in Toronto
Published: May 1 2009 20:26 | Last updated: May 1 2009 20:26
Uncertainty over General Motors’ and Chrysler’s future has hammered US car sales in recent days, driving all major carmakers to declines of more than 30 per cent last month compared with April 2008.
Toyota had an especially bruising month, losing its number-two spot to Ford Motor for the first time in more than a year.
“Retail sales hit the wall in the last week of April”, said Mike DiGiovanni, GM’s sales analyst. While the month started strongly, Mr DiGiovanni estimated that dealership sales dropped to an annualised 7.6m vehicles for the month as a whole, from 7.8m earlier in the year.
Chrysler, which posted a 48 per cent sales decline last month, entered bankruptcy protection on Thursday.
GM’s overall sales drop of 34 per cent was cushioned by a rebound in sales to car-rental operators and other fleet owners. Fleet sales came to a virtual halt in the first three months of the year due to extensive plant shutdowns to bring capacity in line with demand.
GM, racing to avoid a bankruptcy filing before June 1, unveiled a turnaround plan earlier this week that includes accelerated dealer and plant closures, and the demise of its Pontiac brand. It is also seeking buyers for the Saturn, Hummer and Saab brands.
Toyota’s sales dived by 42 per cent, due partly to a tumble of almost two-thirds in demand for the Prius hybrid hatchback, which has been hit by the slide in petrol prices as well as the pullback in consumer spending.
Given the availability of a technology called the printing press which can be potentially used to pump money into the stock market in order to keep it propped up on a permanently low plateau (circa DJIA = 8K), I am not sure why the PTB are so stressed about these test results.
Financial Times
Bank objections delay stress tests
By Francesco Guerrera in New York and Sarah O’Connor in Washington
Published: May 1 2009 20:15 | Last updated: May 2 2009 02:44
US regulators will delay the release of stress test results for the country’s 19 biggest banks until next Thursday, after some lenders, including Citigroup and Bank of America, objected to government demands that they needed to raise billions in fresh capital.
Citi, one of the biggest victims of the crisis that has already been bailed out three times by the government, is believed to have been told by regulators that it needs more than $5bn in fresh capital, while BofA might need to convert $45bn in government preferred shares into common equity.
Both companies are still contesting the findings and might still persuade the government they need less, or no capital, according to people close to the situation. Citi’s own projections are believed to show the company will have hundreds of millions of dollars in excess capital.
After a week of tense talks between regulators and the banks, government sources said the Treasury and the Federal Reserve were set to unveil the outcome of the tests after the market closes on May 7 – three days later than anticipated.
The authorities’ decision to let the original timetable slip also reflects the widespread belief that, after months of speculation since the tests were first announced in February, their outcome has the potential to disturb the markets.
I like this guy’s logic!
Financial Times
Why Starbucks should become a retail bank
May 1, 2009 7:55pm
Starbucks is still struggling to remake itself amid a global economic downturn that has dented people’s willingness to pay a lot for a frothy cup of coffee.
It does not seem to have made up its mind whether to become more of a value brand or stick with being a premium retailer. In fact, it is sending out signals that it wants to do both simultaneously.
So here is my suggestion: why doesn’t it become a retail bank as well as a coffee chain?
I realise that this sounds like a ridiculous idea (and may in fact be a ridiculous idea) but hear me out.
There is, to put it mildly, turmoil in the US retail banking industry, with Citigroup and Bank of America facing the possibility of falling under government control.
There are many reasons for suicide but the recent ones that I know of seemed to be those that figured out that they were worth more dead than alive to their families. No suicide clause in the life insurance policy and debts everywhere, so that policy is the way out and too secure the family.
The collapse of the Soviet Union showed the same trend, middle aged men who had listened to their wives, killed themselves on higher frequency than the norm. Alot more deaths to go and I am scouring the Obituaries for a new potential shack mate as we speak. Who needs to pay rent?
Sorry Sarah.
But you are way late to the party. Where were you when the Wallstreeters were gleefylly ripping off faces and snorting more in coke than I’ll earn in a life time, while their wives and famalies were spending more for lunch than I earn in a year?
gleefully, merrily, whatever… we’re happy to see that there is some justice in the world. For the likes of these death by any means is a just end and sooner rather than later.
The builders are finally catching on to how to price their product in Las Vegas in order to sell it. It sure took them a while. Resale homes in good neighborhoods go for well under $100 a square foot, dropping to levels the city had early in the decade. Good old days are returning.