Bits Bucket For May 24, 2009
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
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“The best part is you can start reservation with 2% down only, in a market which has the potential to appreciate 50 percent every year for the next 5 years.”
“One free Mercedes car is given to all buyers of condos”.
From the Condotel Ad on HBB homepage. Delhi buildings sure look nice when computer generated.
This place is no fun when your posts don’t show up for hours.
…or never in some cases.
Or your post was here, showed up, now not here hours later?
Oops, there it is much later…down.
:}
Poo -
da face!
Leigh
Looks like Texas will have at least one less useless state agency next year.
Senate votes to close building agency
The Senate voted Saturday to disband a state agency that was created to settle homebuilding disputes but has increasingly been criticized as anti-consumer.
The Texas Residential Construction Commission was already headed toward closure because of complaints that it was ineffective in helping homeowners get builders to address defects.
The Senate vote to close the agency on Feb. 1 doesn’t kill off the agency yet. House members may try to revive it before the legislative session ends June 1.
A state review commission recommended last year that the homebuilding commission be abolished because consumers didn’t trust it to protect them from unqualified builders. Consumer groups have argued the agency did more to protect builders than consumers and limited homeowners’ legal recourse in disputes.
I don’t think I’ve ever heard a report of a government agency being legislated out of existence, anywhere.
I’m sure it happens every once in a while, somewhere or other, but I can’t remember hearing about such an instance.
“Nothing is more permanent than a temporary government agency”.
“Never believe anything unless it is officially denied.”
- FPSS
PS :- I’m so effin’ old-school.
Old school. Interesting label!
From a past thread, would appreciate a repeat/more detail about why people in business, media, legislation so willingly go on record as outrageously optimistic in their predictions, even when they know otherwise.
I don’t think I’ve ever heard a report of a government agency being legislated out of existence, anywhere. Well, now you can read about this one. Look up the Freedmen’s Bureau (1865-1872), an almost completely ineffective Federal agency set up just after the Civil War to help the newly freed slaves take on a new position in the USA. If you look it up, you might understand how its history got stuffed down the memory hole.
an almost completely ineffective Federal agency
And how would you distinguish this one from all the others?
It would be nice if HUD and Dept of Education got zapped. Barney would loose his slush fund.
The Texas Residential Construction Commission proved to be nothing more than a hollow promise of consumer protection and was in fact, controlled by the state’s largest home builders.
How’s that for some fancy fraud?
BTW, never buy a Perry home.
Seriously.
Once again, sheeple, follow the money and that’ll tell you what kind of governance to expect. A State agency set up to “protect consumers” that shields builders from the irate folks who bought their crappy houses? Gee, who’d have thunk it - sure it has NOTHING to do with all those generous builder donations for the whores and swindlers elected by empty promises to gullible voters, while the special interests who bankrolled their campaigns call in their markers once their bought-and-paid-for marionettes are in elected office.
Morning, ya’ll.
Thank you to the Vets and current men and women who serve.
And a bright morning to you desert - long time no see…er…type!
And thank you for the warm handshake to our brothers and sisters in uniform -
And to all those whom walked before us.
To all those who call this nation her home - we are in this together -
*clink*
Salute!
USAF (Retired)
Leigh
I’m not going to make friends when I say this, but I don’t thank them. As a Christian I am completely opposed to killing, and our military has been busy waging wars overseas and killing innocent people for as long as I can remember. In my life I cannot remember even one time they actually fought to defend my life, or the lives of my family. Our military is unfortunately little more than hired killers carrying out the orders from our corporate controlled government. I don’t celebrate them. I feel sorry for them. Murdering people so other assholes can make more money, all draped in the stars and stripes.
Nope, it’s just another day to me.
Blessed are the peacemakers. Thank you for your courage, naners.
Naners, I understand that killing is undesirable. Immoral in most cases. That being said, unless you feel like having your wife/daughters/self ( not knowing what gender you hail from ) courtesy Al Qaida, or unless you would like to state “Heil Whomever” and wave your little left arm at the swastika flag every morning as you goosestep by it in formation, I think that you should feel grateful to the military who have served this country so well. There would literally be no Jews left in the world if it wasn’t for the military ( ours and Isreal’s). I say “thank you” and “well-done” to our military, the living and the dead, for a doing a difficult job well. There are a whole bunch of people in the world whose cultural imperative is to make sure that you do NOT live freely.
Warm chair in the den -
Yeah -
War is hell.
Best Always,
Leigh
Another day…
Someday this war will end ~
Don’t feel sorry for us;
We follow orders;
Comfort the ones that do not follow for she always questions…
Forever. Questions. Them.
…
Murdering people so other assholes can make more money, all draped in the stars and stripes.
…
It is what it is HAR!
Ban’pub!
Ben, my bad.
Leigh
Sadly, I must concur. I too thank you for showing the courage to say what I could not.
+1
Todays NYT.
May 24, 2009
Amid Housing Bust, Phoenix Begins a New Frenzy
By DAVID STREITFELD
PHOENIX — Every weekday morning, Lou Jarvis drives the sun-baked suburban streets looking for investment gold: a family that will lose its house in a foreclosure auction within a few hours.
If the property looks promising, Mr. Jarvis puts in a bid on behalf of any of his dozens of clients eager to become landlords. When he wins, he offers to let the family stay in the house and rent for much less than their mortgage payment.
With this sweltering desert city enduring one of the largest tumbles in housing prices for any urban area since the Depression, there is an unrelenting stream of foreclosures to choose from. On some days, hundreds are offered for sale at the auctions that take place on the plaza in front of the county courthouse.
There is also a large supply of foreclosed families who can no longer qualify for a loan. And that is prompting a flood of investors like Mr. Jarvis, who wants to turn as many of these people as possible into rent-paying tenants in the houses they used to own.
Real estate got just about everyone into trouble in Phoenix, and the thinking seems to be that real estate is going to get everyone out.
The low end of the real estate market here — and in some equally hard-hit places like inland California and coastal Florida — is becoming as wild as anything during the boom.
One real estate agent was showing a foreclosed house to a prospective client when a passer-by saw the open door, came in and snapped up the property. Another agent says she was having the lock changed on a bank-owned home when a man happened by, found out from the locksmith that it was available, and immediately bought it. Bidding wars are routine.
Absentee buyers, who can be either investors or individuals purchasing a vacation property, bought nearly 4 of every 10 homes sold in the Phoenix metropolitan area in April, according to the research firm MDA DataQuick. That is up 50 percent since late 2007, and is nearly the same ratio as at the 2005 peak.
Once again, just about everybody seems to be buying as many houses as they can, positive it will make them rich — or at least allow them to recoup some of their losses.
“I bought too high a few years ago,” said Jason Fischbeck, an entrepreneur who lives across the street from Mr. Jarvis and is one of his clients. “It cost $225,000. Now it’s worth $110,000. So I just paid $80,000 cash for another. ”
Mr. Jarvis, 47, the former co-owner of a wood moulding company that thrived in the boom and faltered in the crunch, also made some mistakes. Last spring, he contracted for three new homes in the distant suburb of Copper Basin, convinced that real estate was bottoming.
He was wrong. He managed to get out of two of the contracts but had to buy one of the houses, which is now substantially under water.
“You need to buy when there’s blood in the streets,” he said with a shrug. “Even if it’s your own blood.”
In January, Mr. Jarvis began working as director of investor relations for Brewer Caldwell, a property management firm that had been approached by the CBI Group, a real estate fund based in Calgary, Alberta. In its first foray into the American market, CBI is buying 175 rental houses in Phoenix.
One of them belonged to Mary Lou and Jorge Aguilar, who purchased it new for $111,000 in 1999. Three years ago, after a series of financial difficulties, they refinanced for $185,000 for reasons they no longer understand. “Our lender talked a pretty picture,” Mrs. Aguilar said bitterly.
When the couple’s mortgage payment adjusted to $1,242 a month, they fell behind and ended up in foreclosure. They now pay $1,014 in rent, which they say is bearable.
Still, their feelings are mixed. “It’s not our house anymore; it’s someone else’s,” said Mrs. Aguilar, who works for the state welfare department.
For CBI, the deal is sweet. At that rent, it would recoup the $52,000 it paid for the house in about five years. “This type of deal is absolutely not available in Canada,” said Jarrett Zielinski, a CBI executive. “No city here has fallen by 50 percent, the way Phoenix has.”
The investment group is opening a new fund this week to buy another 160 Phoenix homes.
As CBI continues to buy, it is planning investing seminars for its tenants. “Our goal is to be able to sell them their house back,” Mr. Zielinski said. “Wouldn’t that complete the circle?”
First up for Mr. Jarvis’s inspection on a recent morning is a three-bedroom on a cul-de-sac in the suburb of Gilbert. A rival investment crew is already there. “You don’t want this one,” one fellow says. “It’s no good.” Mr. Jarvis just laughs.
Once they are inside, the reason he is trying to send Mr. Jarvis away becomes clear. The house, built in 1991, is clean and well proportioned, with an opening bid of $76,000 — $200,000 less than what it sold for three years ago.
Not every property gets his nod. He considers an older condominium but deems it unlikely to appreciate. A three-bedroom seems promising until he sees the power lines looming just feet from the back fence.
In the end, he makes just one bid this day, for the three-bedroom he saw first. He offers $110,000, which is not enough. At the courthouse, it goes for $114,000. Every week, the foreclosure market is more competitive.
As the day’s auctions wind down, Mr. Jarvis goes back to the office to meet with a group that wants to put $5 million into the Phoenix housing market. A few miles away, the owner of that house with the monstrous power lines, Robert Corr, is being told his house was sold and he has five days to vacate.
Mr. Corr smiled when he heard the news, happy to be the latest of the 78,738 foreclosures in Phoenix since January 2005. He had already rented a van to take him and his family back to Alabama, where they would buy a mobile home and live on 10 acres of land.
Brewer Caldwell has bought about 125 houses this year for its clients. Only a quarter had owners who were living there already and willing to stay on as tenants. Filling up the rest, and all the other houses the company intends to buy, will depend on a steady supply of people who cannot afford to buy for themselves.
“If Phoenix loses population,” Mr. Jarvis says, “then buying houses here is a bad bet.”
As Mr. Jarvis scouts for houses, he sometimes finds a familiar one. In February, he saw a home that one of his brothers bought from a builder in 2005, camping out overnight for the opportunity. With its value now shrunk, the brother was letting it go to foreclosure.
Mr. Jarvis’s daughter Jade also bought a house at the market’s peak — in her case to live in. The other day she asked for advice: should she keep paying the mortgage on something that had declined in value by 60 percent? His conclusion: “probably not.”
“Am I teaching my kids right by letting them walk away from something they made a commitment to?” Mr. Jarvis wonders.
These people are punching themselves in the face. The guy who thought it bottomed a year ago and bought 3 houses, had to bail out of 2 of them…
Don’t they see the big picture?
I figure they think Phoenix will rebound to 20% house appreciation per year!
Interest rates are low and half the homes purchased are first time home buyers who get $8000 off taxes. You double the number of buyers with programs like that and it does make the numbers look good, like housing is recovering. The government is trying to get people buying houses again; is this another housing bubble happening? Interest rates could go up if there is inflation, and eventually there will no longer be any first time home buyers who have money. There is also the shadow inventory which may come on line with folks buying which will hold prices down, and if not, what happens to the shadow inventory if interest rates do go up. There are too many houses for a rental market to make money if the shadow inventory gets sold. What about employment if people change their buying habits and decide less is prudent and maybe they should put money aside for hard times. Got to have people buying all the stuff they think they need like we had at the peak of the market. What about all the credit card debt, and folks who bought too much house, but are still making payments. Interest takes money out of circulation. For a recovery to happen, employment has to increase; otherwise, we have a sucker buyers in the housing market again. Maybe this is not the time to buy, but we are programed to buy real estate and make a fortune.
Today’s Atlantic City Press has two or three wire service items that basically detail how combinations of federal/state/nonprofit programs enable prospective homebuyers to avoid putting down any money on purchase. Back to the future!
In this PHX story I noticed that Jason FischBeck doesn’t take account of his FB status (”now substantially under water”) as he loads up on more houses.
I’m glad these morons are supporting house prices a little bit, so that my mobile-plus-lot borrowers don’t (yet) have their home values completely squished down.
It would be nice to know on what fundamentals these folks are buying Phoenix properties? Sounds like they are guessing based on declines thus far. What if there are more delclines? Too many unknowns left in the US and world economy.
As far as CBI is concerned, what makes them think a 50% drop is a good indicator of a time to buy? So what if homes in Canada have not dropped that much (yet). Phoenix cannot be compared to Alberta or any other city north of the border.
Back when the Japanese were taking over the world a Japanese man purchased an entire subdivision here in Sacramento as an investment and rented them out. I think he sold in 2004/05 after waiting 15-20 years. Is that how long CBI is willing to wait? Professional investment group my tail feathers!
http://www.nytimes.com/2009/05/24/business/24phoenix.html?_r=1&hp
Phoenix housing frenzy.
http://www.mydesert.com/article/20090524/NEWS05/905240326/What%20s%20next%20for%20Port%20Lawrence?&GID=EcvX3ku0nM/J9C2p5sIKiscYBHX/y/oaZVi5PCugYyM%3D
What is new for Port Lawrence? The fence surrounding the entire project in downtown Palm Springs has been taken down. So, now what?
Big empty vacant lot in prime real estate downtown.
Like so many other projects here in the desert…poof. Even the Ritz Carlton.
Just took several pics of homes in Hemet, and the front of Port Lawrence, that I will send to Ben to post. Look for them starting Wednesday.
One sign on both sides of Hemet developement…MAKE AN OFFER.
saw a home in Hemet that had a mausoleum effect with dark green carpeting throughout the house, few windows- not exaggerating at all, and low ceilings, no windows in kitchen, and so on and so forth..wish I had taken photos of that house, YIKES> and yet…drumrollllll
$499,000. Really weird house, on acre that was almost entirely concrete pads, few windows. I think dracula lived there.
Amen.
Good morning, HBBers.
May you all have a safe and pleasant Memorial Day weekend.
Thanks to all of you who currently serve and have served in our military. God Bless you and your families!
RE: Thanks to all of you who currently serve and have served in our military
Dedicated to my deceased father on this battle’s 65th anniversary.
11st Armored Division-21st Regiment CCA, of General George Patton’s 3rd Army. Grievously wounded in Noville, Belgium, January 15th, 1945 by artillery shrapnel, as the result of an attempted bazooka shot on a hidden German 88mm gun emplacement. Recipient of the Bronze Star and Purple heart for meritous service to his country.
http://www.youtube.com/watch?v=zToQ6QRI0Aw
A special thank you to the brave and strong body and minds who have endured combat.
Yes. Thank you for serving our country.
Hey Ate!
I’m freaking out - sort of.
Folks ask me what I do, and I tell them I’m retired. (From what, as it goes).
Then they say, “Thank you for serving our country”.
I just don’t know what to do with that.
I mean, well -
When I served, nobody said such words!
(By the way, thank you Ate, and I mean it).
O.kay…my point is -
Frack.
May you have the best weekend ever!
Leigh
I agree, but have I missed a day here? Isn’t Memorial Day tomorrow, or did I do a mini-RipVanWinkle?
You’re right AZ. Memorial Day is tomorrow.
az lender….I am in 95051 zip….
Wow, now I’m really confused! Having give up the “South Carolina” interpretation, I thought “sc” must mean Southern California. But no, you’re in Sac. So what’s the “c” ?
Not Sac….sc = Santa Clara…95051
Headline should read… Union & Pension fund rob more taxpayer dollars! No worries, much like the gubmint we have no intentions of repaying the debt! Welcome to the new Government Motors…
GM Borrows $4 Billion From U.S. to Push Loans to $19.4 Billion…
May 23 (Bloomberg) — General Motors Corp., facing rising cash needs before a June 1 bankruptcy deadline, tapped $4 billion more in U.S. aid to push its total to $19.4 billion.
GM’s latest loan from the Treasury exceeded a forecast of $2.6 billion, according to a regulatory filing yesterday by the largest U.S. automaker. Detroit-based GM said it needed $1.4 billion more in cash this month than it expected.
The accelerated borrowing schedule means GM will need $7.6 billion in June and beyond, a decrease from a planned $9 billion. GM has said a bankruptcy filing is now probable by June 1, the date set by President Barack Obama to restructure in or out of court.
“We appreciate President Obama’s and his administration’s ongoing support of GM and the domestic U.S. auto industry as we undertake the difficult but necessary actions to reinvent our company,” GM said in a statement confirming the borrowing.
GM and the Canadian Auto Workers union announced a cost- cutting labor deal yesterday, a day after the United Auto Workers union said bargainers gave tentative approval to new contract terms to trim the automaker’s U.S. labor expenses such as obligations to a retiree health-care trust.
Still unresolved is GM’s effort to swap equity for $27 billion in bondholder claims. Bondholders have until May 26 to respond to an April 27 offer from the company.
How much would they need if they were not filing for bankruptcy?
GM borrows $4 billion more, prepares for bankruptcy May 22,
2009 7:59 PM ET
All Thomson Reuters news DETROIT (Reuters) - General Motors Corp on Friday borrowed another $4 billion from the U.S. Treasury and won a cost-cutting deal from Canadian auto workers as a showdown with bondholders set the stage for a bankruptcy filing by the end of the month.
I hope nobody on this board will ever, ever again buy a GM car. Just for the principle of the thing.
Hello
I`m Out of Cash
A tax on beer is comming
it`s rollin round the bend
and I aint smoked a Newport since
I don`t know when
and I voted for Obama
and now I wonder why
now a tax on beer and soda
is gonna make me cry
When I was just a baby
my momma told me son
if someone sounds like Karl Marx
you better turn and run
but I voted for Obama
cause I just could not see
now a tax on beer is comming
and that`s what tortures me
I bet Joe Bidens laughing
and smokin big cigars
Pilosis tellin GM
to make electric cars
and I voted for Obama
cause I just could not see
now a tax on beer is comming
and that`s what tortures me
Was talkin to my neighbor
said a job search made him bored
he stopped payin on his mortgage
and he`s drivin a free Ford
and I voted for Obama
and now I wonder why
cause that tax on beer and soda
is gonna make me cry
Thanks for sharing. I thought it was good!
Walk Hard, JSat.
Love your stuff. Love it!
that is damned good. Well done!
RE: I hope nobody on this board will ever, ever again buy a GM car. Just for the principle of the thing.
Now that “Government Motors” has rendered my Pontiac virtually worthless with the closing of the division, I wouldn’t dream of it.
Neither would I ever consider a Chrysler.
And this is from someone who has purchased American produced vehicles for an entire life.
Pretty damn sorry state of affairs.
hd.
I have found in life, the most scary criticism, (meaning it is most likely to be 100% correct), comes from a humble person who says “I screwed up, and I recommend this”. Real Wisdom comes from there.
This is to put the $19 billion in context….
So how many Years to even start paying back the loans?????
—————————————
DETROIT- General Motors Corp. (NYSE: GM) today reported adjusted 2004 earnings from continuing operations of $3.6 billion, or $6.40 per diluted share, led by record earnings from financial services and a 12-percent improvement in automotive earnings. These results, which were in line with GM’s original guidance, compare to earnings of $3.2 billion, or $5.62 per share, in 2003. Adjusted revenue rose 4.5 percent to a record $193 billion.
For the year, G.M. reported that it earned $2.95 billion, or $8.21 a share, on sales that surpassed $100 billion for the first time, at $102.81 billion. The 1986 earnings were down 26.1 percent from 1985, when G.M. made $3.99 billion, or $12.28 a share, on sales of $96.4 billion.
The Ford Motor Company will report its profits later this month, and its annual earnings are expected to surpass G.M.’s for the first time since 1924. Analysts believe Ford will show a profit of $3.2 billion. If so, the Big Three will have ended the year with a combined net income of about $7.5 billion.
That figure would be less than the $7.9 billion earned in 1985 and the record-setting $9.8 billion of 1984. However, it would mark the fourth consecutive year that combined profits have exceeded $6 billion as the industry continues to recover from its losses of the early 1980’s. Write-Off Cuts Quarter Earnings
I can’t make heads or tales of your post aNYCdj.
The dates throw everything out of context.
It just shows that GM even in the best of times with much higher margins only made a couple of Billion profit per year
And they think GM will make that much per year to pay off the loans
“The private sector is not going to take on more debt,” Bill Bonner explained to a small gaggle of Congressmen. “People know it doesn’t pay. And they’ve got too much already. The private sector is not going to begin a new growth period until they’ve paid off, worked out, defaulted on, or shirked a lot of their present debt load. We’ve estimated that they need to get rid of about $20 trillion worth. And that’s going to take time. And a lot of painful decisions by a lot of people. Bad business, investment and spending decisions need to be recognized…and fixed. Debt needs to be reduced. ”
Mr. Bonner found himself in Washington, DC this week where he noted that members of Congress have the same questions the rest of us have. They read the same claptrap in the newspapers. They hear the same balderdash explanations from economists and federal officials. They’re wondering what is really going on.
“The private sector is not going to begin a new growth period until they’ve paid off, worked out, defaulted on, or shirked a lot of their present debt load. We’ve estimated that they need to get rid of about $20 trillion worth.”
And there it is folks. One person’s debt is another person’s money.
Twenty-trillion dollars is destined to disappear one way or another. That’s going to make any remaining money scarce thus more valuable.
Cash continues its rule. Debt continues to suck.
Deleveraging = deflation.
That debt either needs to be paid back or defaulted upon. Either way, it ends up the same way.
Yep. And if you are at the wrong end of the debt that gets defaulted on then you are hosed.
If you loan money to someone who does not have the resources to pay it back, that’s your problem.
That’s why the Constitution authorizes Congress to enact “uniform Laws on the subject of Bankruptcies throughout the United States”.
Uncle Sam however is treated differently:
“The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
“If you loan money to someone who does not have the resources to pay it back, that’s your problem.”
“Uncle Sam however is treated differently.”
This is why Uncle Sam can sell Treasuries much easier than corporations can sell their bonds. This is why real interest rates on corporate bonds are destined to rise.
And this is why those that have more money than they need get to call the shots to those who have less money than they need.
And this is why those that have more money than they need get to call the shots to those who have less money than they need.
This has been true throughout history. That 1983-2007 has been an extraordinarily aberrant period due to asset-inflation is a story that is lost to the average person who mistakes recency for permanence.
Nice Point Faster.
“That 1983-2007 has been an extraordinary aberrant period due to asset-inflation is a story that is lost to the average person who mistakes recency for permanence.”
Wealth will flow to those who understand this from those who don’t.
Like DUH, my good man, like DUH!!!
I’ve said before, and I’ll say it again, I hope y’alls is right. I’ve been in camp Combo/FPSS for quite some time. It is the only outcome in which my family is rewarded for patience, honesty, and good, old fashioned work.
I dunno. Maybe I need to give day trading a second chance
I dunno. Maybe I need to give day trading a second chance.
AhhhhH! You!
*administers a good, brisk virtual slap to the Muggy-mug *
I hope that assists you in your decision-making process?
I exist only to serve, as you all know.
‘Must-touch-the-hot-plate’
Oh, why not. May as well give it another try…
I was just playing. I placed my withdraw order Friday. There is still $10 in there, and 486 free trades left.
Hmm…
“I dunno. Maybe I need to give day trading a second chance”
At the risk of riling up our favorite PNW babe I’m gonna take the other side of Olygal’s verbal trade above and say that you should study it more. You might find it quite enjoyable and have a knack for it.
I don’t touch the hot plate every day, but it’s fun when I do.
*administers a good, brisk virtual slap to the Muggy-mug *
“I’m gonna take the other side of Olygal’s verbal trade above and say that you should study it more. You might find it quite enjoyable and have a knack for it.”
So you’re thinking a good slapping around by Olygal might be kind of fun, eh?
And delivering has become much harder with the wealth destruction that has occurred.
Some portfolio’s that were assumed to be conservatively leveraged, lets say, 50%, now find themselves maybe 75% levered or more…The equity has been vaporized but the debt obligation remains…
“We’ve estimated that they need to get rid of about $20 trillion worth.”
How does he come up with this figure? It seems very high to me. The total US GDP is 14tr.
If anything, that’s an understatement. I come up with $40-60T globally. US is half of that roughly so at the low-end, I agree with that estimate.
Where does that number come from?
Derivatives, my good man, derivatives.
This will take a while.
“Bad business, investment and spending decisions need to be recognized…and fixed. Debt needs to be reduced.”
Along with bad business and personal decisions.
“Debt needs to be reduced.”
“Along with bad business and personal decisions.”
Such work is currently in progress.
Debt needs to be reduced.
= DEFLATION.
Thank you, that will be all!
Issuing debt is how the money supply is expanded.
Paying off debt has a deflationary effect as it reduces the money supply.
Defaulting on debt in of itself is not deflationary.
Sounds counter-intuitive but go ahead and look it up.
So what says you about thus.
Are you retarded?
Defaulting on debt means you just wiped out the borrower. If that’s not deflationary, I don’t know what is!
You are a total and complete mor*n. I recommend some remedial math.
Paying off debt reduces the money supply and hence has a deflationary effect.
Is there no one here that can explain this simple concept to those that do not understand?
Defaulting means you don’t have to pay jack-effin-sh*t!
Are you really this dense?
One more try:
A person borrows $100,000 and decides not to pay it back. He defaults. In this case the borrower has not been wiped out; he still has the $100,000. In fact, he has more money than ever because he isn’t paying any of it back.
This is just a very primitive simple case to try to help you understand money supply.
Look up money supply. Look it up. Don’t just bad mouth something that you don’t understand.
No, that $100K is not in the system because it’s been replaced by -$100K to somebody who loaned to money or a hit to the basic reserves of a banking system.
You’ve clearly never analyzed a bank balance sheet in your life.
Swami, this is not India where on Shaniwar, everyone takes everything on faith. Get a clue, Mr. Clueless!
Ah, good point. So here is the bottom line. As long as that -$100,000 that the banks lost is being replaced by bailouts, then it really isn’t lost. As long as the quantitative easing aka monetizing the debt aka printing money out of thin air continues then the result of defaults will be INFLATIONARY. When the quantitative easing stops and the banks have to realize the losses, then it becomes deflationary.
They need to stop printing money out of thin air pronto. This is why the precious metals, and interest rates having been moving up over the last month, because of the quantitative easing that began a month ago and its inflationary consequences.
As long as the losses are not being realized on the banks balance sheets because of the bailouts and the recent quantitative easing aka monetization of debt aka printing money out of thin air; the effects will be INFLATIONARY.
Only when the printing money out of thin air ends and the losses are realized on the banks balance sheets does it become deflationary.
No, sweetheart!
Monetizing PAST debt is the legitimization of PAST inflation. It in no way shape or form affects FUTURE inflation.
You are quite literally clueless about monetary policy, aren’t you?
Monetizing PAST debt is the legitimization of PAST inflation. It in no way shape or form affects FUTURE inflation.
BINGO
The reality is that
The person who borrowed the 100,000 does NOT “still” have it. It has been spent on a house a new mall a new car ect.
The person who was smart and sold the property realizes that there are way too many malls or houses now for the shrinking number of buyers and thus parks his or her cash.
The person who sold the car realizes that no one can afford his cars and so fires a huge number of workers.
The Bank that gets a partial bail out does not lend for the same reasons.
Where does the inflation come from?????????????? When I see unemployment dropping, and incomes rising then I will start to believe in green shoots. We are a long way from there.
Let me respond to that a bit. Let’s think about what is actually happening to the global economy right now. On the one side there has been an abrupt realization by many people that they have too much debt, that they are not as rich as they thought. US households have seen their net worth decline abruptly by $13 trillion, and there are similar blows occurring around the world. So the people, individual households, want to save again. The United States has gone from approximately a zero savings rate two years ago up to about 4 percent right now, which is still below historical norms; but suddenly saving is occurring.
That saving ought to be translated into investment, but the investment demand is not there. Housing is flat on its back because it was overbuilt; housing bubbles collapsed not only in the United States, but across much of Europe. Many businesses cannot get access to capital because of the breakdown of the financial system. But even those that do have access to capital don’t want to invest because consumer demand is not there. Between the housing bust and the sudden decision of consumers to save, after all, we have a world with lots of excess capacity. The GDP report that just came out says that business-fixed investment, non-residential fixed investment, essentially business investment, is falling at a 40 percent annual rate.
This causes a problem. There are lots of people who want to save, creating a vast increase in savings, not only in the US but around the world, combined with a sharp decline in the amount that the private sector is willing to invest, even at a zero interest rate, or rather even at a zero interest rate for US government debt, which is what the Federal Reserve has the most direct impact on.
One way to think about the global crisis is a vast excess of desired savings over willing investment. We have a global savings glut. Another way to say it is we have a global shortage of demand. Those are equivalent ways of saying the same thing. So we have this global savings glut, which is why there is, in fact, no upward pressure on interest rates. There are more savings than we know what to do with. If we ask the question “Where will the savings come from to finance the large US government deficits?,” the answer is “From ourselves.” The Chinese are not contributing at all.
Those extra savings are, in effect, the savings that America has wanted to make anyway, but that US business is not willing to invest under current conditions.
nybooks.com/articles/22756
Nice little debate
and another bit of analysis from Krugman about why interest rates aren’t likely to rise rapidly.
krugman.blogs.nytimes.com/2009/05/02/liquidity-preference-loanable-funds-and-niall-ferguson-wonkish/
“Where does the inflation come from??????????????”
From overseas. Increased supply of us$ leads to decrease in value of dollar and increase in price of energy and commodities. I think we are going to see inflation and deflation at the same time.
Anything made locally and consumed locally will be going down in price: houses, candles, wages, us cars; anything competing on the world market will increase in price; energy, food, metals and products containing metal and energy.
Growth is going to come back in China and asia a lot sooner than to the US. So any commodity traded worldwide that has limited ability to increase production will increase in price.
China is buying over 1 million new cars a month, more than the US. These are new cars on the road, not replacemement vehicles like the majority of us vehicles. At the same time the world supply of petroleum is flat to down. The world number of vehicles is a now a zero sum game. Everytime a Chinaman buys a new car, someone in the US will now no longer be able to afford to operate their’s and their car will be sent to the scrap yard.
My advice, dont buy real estate, bonds, or stocks of companies relying on the US consumer. Do buy stocks of energy and commodity firms, especially those selling to the asian market.
The INFLATION comes from the DEVALUATION OF THE DOLLAR caused by the monetization.
Note the US Dollar Index broke below 80 on Friday.
“A person borrows $100,000 and decides not to pay it back. He defaults. In this case the borrower has not been wiped out; he still has the $100,000.”
If that $100,000 has been thrown into the REIC black hole (e.g., used to fund construction of abandoned tract home developments in the California high desert), then the real wealth potential of that money is lost for good, and the only question that remains to be answered is who will be the bagholder for the zombie debt left in the wake of the act of wealth destruction. It appears some top economic policymakers are doing their best to spread that sh!t as far and wide as possible over people who had nothing to do with creating the mess.
The person he bought the black hole from has the $100,000
Some inflation is also caused by mfg/retail who mark up prices to cover falling volume.
Some other inflation is caused by speculators and bears no relation to fundamentals.
Then there is the deliberate product withholding creating artificial scarcity.
Yes, they really do that. Much like your local prop. tax office or mortgage lender. They aren’t the only ones who play those games.
Where does the inflation come from??????????????”
From overseas
Oh yes the decoupling that Goldman Sachs was so vocal about.
Wrong
Exports from China and Japan are falling rapidly.
Oil production is being cut because there is no demand.
Read the Krugman piece above.
Link:
Forever in Bubbles
by Bill Bonner
http://lewrockwell.com/bonner/bonner383.html
Mr. Bonner found himself in Washington, DC this week where he noted that members of Congress have the same questions the rest of us have. They read the same claptrap in the newspapers.
But unlike us, they have sleazy K-Street lobbyists ooze into their offices every day, who understand the pay-to-play nature of our political system. These Republicrat hustlers con the sheeple with campaign trail rhetoric, while going for the best payolla Wall Street and the special interests will ante up in exchange for, shall we say, a favorable legislative agenda.
“Giving money and power to government is like giving whiskey and car keys to teenage boys.” ~P.J. O’Rourke
Major General Smedley Butler, USMC and his essay on war. Just as topical now as it was in the 1930s. Who makes the profits
http://www.ratical.org/ratville/CAH/warisaracket.html
As we go deeper into a financial morass, more and more young folks will likely choose the military as a career, or as a way of feeding their families.
Already happening.
There is a high percentage of people in the military, especially in the support branches, who are basically along for the ride - if they weren’t in the military, they’d be delivering pizzas, because that’s about as smart or ambitious as they’ll ever get. When people get paid the same on the 15th and 30th of the month whether they bust their butt or do the bare minimum, you do see a lot of glorified welfare recipients in uniform. You also see a lot of out-and-out lowlifes. Sad but true.
As with any organization, twenty percent of the force structure is responsible for about eighty percent of what actually gets done. I honor veterans, but only the ones who served conscientiously and were a credit to the uniform and their country.
Sammy,
I would guess that you served, from your words.
Or (pardon), you are a *brat* -
You speak from some experience - drawing on what I do not know.
I’m happy to say, those that I worked with were not of the 20% -
For this I am grateful…
Best Always,
Leigh
A raised cup of coffee to all the vets and those
serving now for giving us our freedom that we are
so rapidly losing.
The shame is that all the brave men and women who served our country will have done so in vein if our basic freedoms are rescinded.
Freedom is not an entitlement.
+1
Conversely, entitlements are not freedom.
Freedom isn’t capitalism either. Something our lords and masters want us to forget.
This time of year I hear from many of the guys in my unit from 68-69′ in Viet Nam and to the man we are grateful to our brothers who made it possible to be here. Many of them are not. Those are the hero’s.
I feel it fitting to mention one. His name is Lt. John Bobo and he was the bravest of the brave. He is not with us now but received the Medal of Honor.
Google him and you will read of true gallantry. A real Marine’s marine.
Semper Fidelis
Gob Bless you John.
Hey Dime,
Just wanted to mention my dad. He was one of the Marines on Iwo. I’m told he gave away everything he owned before he went.
Some poeple are lucky enough to grow up with their hero as their best friend. Like me.
I miss him.
“The 8th of November” Platoon medic Lawrence Joel courageously treated his fellow soldiers despite being shot twice. He treated his own wound and self-administered morphine to enable him to search for wounded, provide treatment and call out encouragement. He was later awarded a medal of honor for his service.
One, then two companies, ‘B’ & “C,” of the 1st Battalion of the 173d Airborne were attacked and surrounded by 1,200 NVA in War Zone “D”. They were fought desperately for their lives and the lives of their friends. Many of the wounded wouldn’t have made it out alive if it hadn’t been for the likes of men like Larry Joel.
Everyone was a hero in that brawl.
I am both impressed, and grateful I read how much of man you are. You are the people who did it.
Others, in my mind, have no standing to be critical of benefits, or ANY help the veterans of our country deserve.
My admiration,
ATE-UP
A lot of people (not just on this blog) seem to be confusing Memorial Day with Veterans Day. The former is meant to honor those who have fallen while wearing the uniform of their country, and are no longer with us. The latter is meant to honor living vets and those currently serving.
Bill:
With all due respect, as I am both a newbee and a wantabe, that is true.
However, both days are appropiate to acknowledged ALL of our heros. Whether dead or alive.
Bad spelling. I get emotional about veterans.
You did just fine. I was going to post the same thing, but you said it better. It’s hard to remember our fallen heroes without also thinking about those currently serving. It is for me anyway.
With people so fixated on themselves these days, any time that we pause to genuinely reflect on the sacrifices of others on our behalf, it’s all good IMO.
Thanks and Godspeed to all men and women in the armed services, wherever you happen to be.
Don’t worry about it ATE-UP. If you hang around a bit longer you will learn that saying other people do things all wrong is just Bill’s modus operandi. The idea that a self-declared libertarian would even want to tell people that they aren’t observing Memorial Day properly seems ridiculous to me, but it is just what I would expect from him. I typed up a list of DC Memorial Day events yesterday and he was complaining about the fireworks at one event. Guess the Marines (music at the event is provided by the Marine Band) don’t know how to observe Memorial Day either.
Wow. (Thanks Polly)
Polly, you’ve said it so much better than I could.
Saw a house today in Hemet that was obvious it was vacant and deserted, debris, bugs, spider webs everywhere, old newspapers, and huge overgrowth of weeds etc, but there was a Flag flying.
Gave me pause.
Polly,
I just want to say, “Thank you for serving”.
I served with “Civilians” -
Gallant ones -
Sad is today, for some forget to say “Thank You”.
As you serve your country as proud as any!
Best Always,
Leigh
However, both days are appropriate to acknowledge ALL of our heros. Whether dead or alive.</i.
Well spoken.
It’s all about jobs and survival mode for j6p & family now. People with good sense DON’T buy houses or new cars when they should be battening down the trusty old rental hatches and trying to squeeze another 100k of mileage out of the family transportation beaters.
From Milwaukee Journal Sentinel Online…
Wisconsin job-loss crisis demands fresh thinking
Posted: May. 23, 2009
Any way you cut it, Wisconsin’s job losses paint an ugly picture.
Companies that have gone decades without layoffs, like mine, have gone through repeated rounds of painful downsizing. Industrial markets have been bouncing along the bottom since November without visible sign of an uptick.
Further, the deceleration at the end of 2008 was so sharp that companies had a hard time adjusting their fixed and even variable costs to the collapse.
Many of the jobs will not come back, such as the automotive jobs in Janesville and Kenosha. That suggests more than a cyclical downturn. It speaks of a fundamental restructuring of the manufacturing sector of the state’s economy.
Manufacturing has been the hardest hit of all sectors in the state. Of the 128,300 jobs lost over the last year, manufacturers were off by 52,700 through April.
http://tinyurl.com/okp6af
“People with good sense DON’T buy houses or new cars when they should be battening down the trusty old rental hatches and trying to squeeze another 100k of mileage out of the family transportation beaters.”
Get ready to pony up, as you are about to help nudge some more first time home buyers off the fence with downpayment assistance, whether or not you agree with the idea of encouraging young families to take on supersized debt burdens during the worst economic downturn in 60 years. If any of these folks later get foreclosed, you will also enjoy the pleasure of helping to pay off the bank the guarantee on their FHA or GSE loans.
Well, I am a first time home buyer and I am getting an FHA loan, but even if I go underwater, I am retiring (to Wisconsin) and will have a guaranteed income. However, I could die and that would cause financial hardship if I proceed my wife since my retirement would stop. Maybe I should do some prepayment on the loan, but first the credit cards. I am finding with my defined benefit retirement plus social security, and no money taken out of the paycheck for retirement program, medicare and social security, that I am taking home about $3000 more per month after retirement. Now days my employer does not have nearly the retirement program for new employees that existed 40 years ago.
Somehow I find your statements that you are a first time home buyer and that you are retiring to Wisconsin on a defined benefit pension package worth over $3000 per month just a little bit incongruous. But I suppose since the federal government has widened the definition of “first time home buyer” to include everyone who has sat out the bubble, perhaps there is no incongruity…
I said $3000 more, the actual amount is $10,000/month
“…the actual amount is $10,000/month”
Great to hear that, and I am so happy that Uncle Sam is forcing me and others who pay taxes and take their pay checks in $US to provide you with downpayment assistance plus a guarantee on your FHA mortgage. I don’t for you to take this personally, but frankly your case is a perfect example of why federally-provided downpayment assistance and mortgage guarantees are a bad idea.
Holy S—t!
Damn, I went into the wrong industry. what industry are you in?
10k. man o man. I am depressed now, need a beer.
From PB’s link:
Rivinius said funding for the state tax credit is being depleted fast, but legislation is now pending in Sacramento that would add another $200 million – and that “should allow buyers to receive credits” through the end of the year.
———————–
It’s good to know that the state of California understands how to prioritize. After all, subsidizing homebuilders/developers is certainly more important than paying for teachers, police, firefighters, etc.
/sarcasm
Until the PTB decide to invest in new technology and science (physical tangibles with physical ROI) instead of worthless paper, there will never be real growth and rising standards of living again.
But they aren’t going to that. Disturbs the status quo. A lot of the PTB won’t be the PTB any more.
Speaking of the PTB and status quo:
From 1974
President - Gerald Ford
White House Chief of Staff - Rummsfeld
Secretary of Defense - Cheney & Rummsfeld
CIA Dir. - Bush Sr.
Secretary of State - Kissinger
Secretary of State - Kissinger~~
grrrr…
White House Chief of Staff - Rummsfeld~~
grrr…
Before blogs.
My apologies, Mr. Ben Jones.
Will not pollute the den -
Curtsey,
Leigh
In fond memory of my dad who sacrificed his eyesigerht to serve in World War II in the Pacific, and in honor of my late uncles, their friends, and all the other men and women who served and are serving in the U.S. armed forces. Thanks!
I’m in Portland, Oregon visiting a sister. I haven’t been here since the 1960s and was too young to remember much about it. Beautiful place. I picked up a real estate brochure just for kicks. Lots of places with views of Mt. Hood or Adams or both. Prices are relatively reasonable (from the perspective of Hermosa Beach, but then, HB has - the beach, and no snow).
We went to Multnomah Falls and to Mt. Hood. Perfect weather here this weekend.
True Heroes.
Yer in OR, huh, Bill? Oregon is super! Man, I love it. I was gonna end up in Portland was my plan when I loaded my car and headed west, I thought I’d go see what that thar Olympeeahh was all about first, for just a bit, ‘fore I headed down I-5 to my destination. That was 5 years ago. And as you see, I am ‘Olympiagal’ and not ‘Portland-lass’.
Speaking of snow and Multnomah Falls, I drive the Columbia River Gorge every year on the way to Utarr for Christmas and one of the beautifullest things there ever was is all the waterfalls in the falling snow, and the dark water, and the ice sheeted up and sparkling on the rock walls…
Plus no one’s there, which is a real benefit.
Two years ago I stopped to look at Horsetail Falls and the thunder and hiss and blowing ice-crystals evidently enchanted me so that I fell into a bit of a reverie and lost track of time, so I go to head out and I jerked forward and about fell on my face, because my boots was plumb froze in place in the icy slush, about an inch. I must have been standing there awhile, huh?
Let that be a warning to all of you, set a timer when you watch waterfalls in the snow.
Yeah we went to Horsetail falls too. Set the camera to TV to get good motion.
I can do without the ice. It’s one of the most terrifying things to drive in ice.
My sister is great with her camera. She also is super in web development in Hillsboro. She gave me a Canon for my birthday so I am just starting to understand the features.
It was neat to be able to think of Washington on the other side of that river - no state income tax!
If I move to Oregon I would get the Seligman Municipal fund for Oregon to help offset state taxes.
Well I fly out this afternoon back to the beach cities.
I can do without the ice. It’s one of the most terrifying things to drive in ice.
Oh. Yeah. I remember that part. I believe I spent about 800 miles in 4-wheel drive that particular trip. The truck kept warm, though, from the heat of my loud cursing and praying and stuff….
Thanks a lot, Bill! I had mercifully repressed the memory, right up until now!
I raced professional motocross for 4 years. I hate ice. Can’t control it. Can’t gauge what it is either.
How do you spell guage?
‘Gaugue’?
Speakin’ of ice, I recall on that Christmas trip the minute I crossed over the Snake river from Oregon and entered into Idaho, allllll the ice went away. I mean, there was a freakin’ line of demarcation.
They must salt the livin’ blazes outten their roads in Idaho.
I thought about that as I picked up speed and when racing merrily along at about 90 mph. I eventually decided, right about ‘Napa’ time (that’s a nod to Dennis and his discussion of the pit that is Napa) right about then I decided that I’d take the icy driving over the damage to watersheds and soil and stuff from salt.
But I must note, I was already busy repressing the memory of the driving on ice. Had you asked me earlier I might very well have screamed ‘F0*0k the eco-system! I’m a gonna die! BRING THE SALT!’
You look it up, OLY!
:)
OLY, there was no “reply” on your last post, but it is undoubtedly true, ( and I know everyone here agrees), there is no one like you.
on here i meant Oly. There are Frogs everywhere… if one looks.
Last time I got my nails done, was in Reno, yrs ago during Christmastime. As I drove to mom’s house, suddenly there was black ice everywhere. I think I broke all the nails, and decided I am better suited to blowing sand and sweaty summers, amazing hot steering wheels in August.
So, you kids can just tell me about the iciness, and I will listen with rapt attention!
desertdweller, all the way up to here I thought you were a man. But then now, more and more men are getting manicures. For a bit, I was beginning to use men’s face products from Origins (blush). I quit doing that after 6 months, due to laziness.
Appreciate your relatives and your input, Bill.
Thank you Robin, my dad was my best friend, whom I lost in 2000. People like him and my uncles and my dad’s friends who also served in WWII were / are incredible.
I ain’t nothing in comparison to them. I am forever grateful for their sacrifices and bravery.
The last thing I did in honor of my father was hold the wrapped American flag at his memorial service while I stood next to my sisters.
Yes I miss him and I still remember his wisdom.
Morning HBBers and Ben! Thanks for the good words on my new blog yesterday. (You can click on my name to link to it. Sorry for the shameless self-promotion, but we writerly-types will do about anything to be read, you know, you should pity us, it’s about all we have.)
I’m in Moab, Utah, and we had HUGE flashflooding yesterday, not much in town, but all over the desert and more for today forecast. There was a stream running by my rental for about 15 minutes, then it was gone,leaving a small arroyo where there was none before. It’s so cool, big waterfalls coming over the cliffs, I did a lot of filming. Also a beautiful rainbow. Hope to post some photos tomorrow on my blog. Will be heading back to school in Montana soon, so enjoying the desert while I can.
And you know what? I used to obsess on buying another house after I sold mine, but now I don’t even care. I’m now free to move when/if I want. So chew on that, NAR. And when the water was coming down, I actually was thinking how glad I was to not own a house and have to worry about damage. They even closed the road by my house, it crosses a small stream which flashed and brought down a tree and lots of mud. I enjoyed nature’s craziness instead of worrying about my possessions.
I used to obsess on buying another house after I sold mine, but now I don’t even care.
I have claimed this on this blog all along. This isn’t over until all the HBB-ers stop giving a cr@p about housing (and you can check that I was saying that two years ago!)
Ironic, I know!
Puddytat, you are like the Oracle of Ledphi, I mean Delphi.
Did you receive the Times Square Rolex yet?
If not, could you send me a check for $10 so that I could send it via Certified Mail next time?
No, it’s OK, I got it!!!
But the hands were missing…
That’s par for the course for Times Square Rolexes.
You could send it back with a pre-paid envelope with $100 (in bank drafts!) and I’ll get the hands fixed.
Oh, never mind, I just figured it out, it’s digital!
(nice try, Puddytat)
Yo, I’m just giving you the full Times Square treatment for your buck!
Hey, Puddytat, did you get those Jackalope steaks I sent you the other day?
Of course you should not overpay, but having a modest home that is paid off goes a long way towards fixing your living expenses and is part of smart retirement planning. Normally wage inflation should come relatively close to cover rent inflation. Do you think the same is true of Social Security?
+1 on this.
But this was not my point. I mean we will ALL get to a point where we simply stop thinking about it at the front of our cranium, that’s all!
Yep. When the bubble blogs die off, then we will be at the bottom.
EVERYONE was affected with the bubble mania — some on the bull side, some on the bear side — and when we (yes, that’s us HBB’ers) spend countless hours, every day, for years (!) on a housing bubble blog, then we are no less affected than the flippers with 40 leveraged properties. Just two sides of the same coin.
You know, you’re right. I have bought, remodeled and sold at least 20 piences of property in my life. The price range? 15K-750K in 1993 money. That piece of property, (”Can you say “McMansion”)? along with a crack cocaine addiction (free from= 16yrs.), cost me my beloved wife.
Since, I bought and sold three in Florida, remodeled them all, and got out by the SKIN OF MY TEETH, in 2006. Sold modest condo for 90K 2years and one-day after purchase. buying price = 40K. Then smelled Rat, and took a 20K hit on two, one condo, other SFH, and that was it for me.
Never. Never. The TAXES cannot be controlled.
90=80
By the way, and I really don’t get any kicks out of this. I actually feel bad about it. But, those places now, two in a modest but nice non-gated condo complex, and the other, a single family home I remodeled (lost 16lbs. doing it working full time), are now worth on the mean average of the three, 35 cents on the dollar.
Why would you feel bad about it? You didn’t sell a fraudulent product - you sold it to a greater fool - that’s pretty much the American way, dude!
Agree.
“This isn’t over until all the HBB-ers stop giving a cr@p about housing…”
Spot on, FPSS. I keep thinking we are getting closer, but then another collision of real world data with a wall of off-pitch econoganda out of DC ropes in my interest once more.
Lost, the “live traffic feed” on your blog is kind of cool, I haven’t seen that before. You saw me coming from “Bangor, Maine USA” which is about 50 miles wrong…that’s why you’re Lost, right?
Lostie,
Great great blog. Saw the traffic feed. It’s got me on the wrong side of the bay
It’s for sure not very accurate, it shows me as coming in from Idaho. I know I’m lost, but I don’t think I’m THAT lost…
Awesome+Cubed blog, Losty. I’m really glad you reposted about it, too, because I only got on the HBB a few minutes yesterday and didn’t see it.
I read it and just wallered in nostalgia. But where’s the photos of wildflowers?
Hahaha! I summited Molly’s Nipple once! And I’m ONLY gonna call it MOLLY’S NIPPLE, don’t care if that’s not PC, ’cause that’s it’s name.
Ahhhh….
How super.
What a lovely day I’m having!
Great pictures.
Man do I miss the Rockies. *sigh*
Eco, I’ll do a blog soon just for you on the Rockies…
Oly, there’s a story in there somewhere of you as a youngster on the Nipple.
I enjoyed nature’s craziness instead of worrying about my possessions.
Hit it Janis! Freedom’s just another word….
So interesting question. How do you strike that balance of having possessions, but only to the degree that you don’t care if you lose them? How do you make everyday feel like a carefree rainy day in a rental?
I have a few things I wold really miss, but they’re very portable - a few landscape paintings, Navajo rungs, and my bike. And I used to have a big house full of stuff. I gradually just got rid of things till I was down to the basics, and I can’ even tell you what I had now. But it feels better…
Since I woke up to my house burning down around me, the only thing I walked away with were my car keys (police drove car away from burning garage) and the sack the RedCross gave me with a toothbrush and comb and lotion…since then I haven’t had a need to amass stuff. In fact, lots of replacements were purchased for under 50$ at garage sales. No emotional tug there.
Surreal life experience helped me get over “things”.
***********************************
“Hit it Janis! Freedom’s just another word….
So interesting question. How do you strike that balance of having possessions, but only to the degree that you don’t care if you lose them? ”
*******************
I do miss the hand lotion I used my entire life. Pfizer then J&J stopped making it. Nothing compares.
What a horrific experience, but interesting that you chose to not restore what was lost.
When I was a news reporter, I remember what the Red Cross would issue to disaster victims. It was more comforting than utilitarian in many cases, but it made a difference.
maybe we should revisit what was valuable to us in our early 20s: spend money on travel instead of spending money on dust collectors.
Glancing at the April 2009 DataQuick numbers, here are the year-on-year price changes (since April 2008) by area of San Diego:
Central San Diego -31.6%
East County -26.5%
North County Inland -25.9%
North County Coast -25.2%
South County -28.8%
Despite all the jawboning out of central planning authorities, it is pretty hard to argue that San Diego home prices are not dropping at or near the fastest rate on record.
Against the backdrop of the collapsing bubble, there are myriad efforts underway to put the Housing Bubble version of Humpty Dumpty back on the wall. The juxtaposition of stimulus measures like first-time buyer credits and mortgage guarantees on FHA & GSE loans is likely to encourage a new wave of weakly-qualified buyers to catch themselves falling knives, only to later face “higher-than-expected” foreclosure rates. At least the lending institutions will be off the hook, as the defaults are federally guaranteed.
I would love to see a poll on what percent of Americans support these measures to support first-time buyers with free downpayment money, as it certainly appears the politicians have once again caved in to the REIC lobbyists who capture them with campaign contributions — the rest of the country be damned. I expect the current efforts to reflate the bubble will prolong its denuouement and worsen its eventual collapse. But then I am known as a bit of a pessimist about this situation.
What Russian toddlers recite [my transliteration]:
Shaltai Baltai sidyel na stinyeh
Shaltai Baltai svalilsyah vo snyeh
Vsyah karalyevskaya konnitza [the king's horses etc]
Vsyah karalyevkaya rahtj
Nyeh mogut Shaltaia
Nyeh mogut Baltaia
Shaltaia Baltaia sobratj.
Ochen6 horrorshow!
Haha, ‘horrorshow’ indeed.
You know what, I don’t remember any Russian at all. None. I took it two semesters, and once I stopped it all done leaked right outten my fluffy head in about ten days. I had thought I was alllll so super good at languages and that my fluffy head would pick it up in a snap, and, more importantly, I would then keep it inside my fluffy head, but nope. Alas.
Although I did meet some very interesting Russians, so it was not a total loss. There was this one guy who could do that one hoppy up and down with arms crossed dance, like in old movies? Although I suspect he was humoring me and that they don’t really do that dance much over there. He had some unusual scars on his person that made me decide that Russia is not a very gentle place.
Oh, yeah, and I ate some SUPER borscht.
Okay, then, it was worth it!
OlyGal — Have you ever read A Clockwork Orange? If not, I highly recommend it…
OlyGal — Have you ever read A Clockwork Orange? If not, I highly recommend it…
Of course. How else you think I got the ‘horrorshow’ reference?
Sorry to be dense
— I thought maybe you connected it to your Russian studies…
Fun fact: Anthony Burgess was not only a gifted writer, but also a classical composer of sufficient accomplishment to warrant an entry in Baker’s Biographical Dictionary of Musicians. Sadly, I have yet to hear or perform any of his works.
Here’s the answer - publicly financed elections that are of limited duration and way downsized. No more campaign contributions.
+12 million, ATC!!!!!
And you know it will never happen, because the PTB want to retain control of the govt’s puppet strings, the rest of us be damned.
“I expect the current efforts to reflate the bubble will prolong its denuouement and worsen its eventual collapse. But then I am known as a bit of a pessimist about this situation.”
I don’t think you’re off target here. My inclination is to believe this will take another 5 to 10 years to play out and prices for housing relative to the cost of other things will be lower because of the intervention efforts.
I already have a jaundiced view of housing in this country. What will that view be after another several years of overpaying for substandard housing?
I so agree with you SDGreg. My husband & I were talking about the possibility of NO economic recovery (at least in our area ) for the next 10-15 years. That would really freak people out. I don’t know whether it would make sense to continue to pay off our mortgage or not. I am contemplating putting all (ALL) excess income to paying off the house note over a 5-year period. We could do it. Not sure if it’s worth it. We already have a paid-for retirement house that is too far from my workplace to have a comfortable morning drive. He bought our current residence before we got married. I’m tired of the mortgage note. I’m contemplating things to change that.
If San Diego buyers don’t feel like dealing with the overpriced offers on the MLS, I recommend ForeclosureTown dot com as an alternative. Here are counts of homes listed there for selected zip codes formerly known as a bit frothy:
Zip Code / Area / Number of Homes / Median List Price (x-bankruptcies)
92127 (Rancho Bernardo West) 240+ $547K
92130 (Carmel Valley) 280+ $670K
92037 (La Jolla) 420+ $1,295,000
92067 (Rancho Santa Fe) 197 $2,990,000
Yeegads! La Jolla is blowing up! I predicted this scenario long ago on this blog, but it is still quite amazing to see it actually happening.
Like I’ve been joking about for the past 6 years, young couples in my ‘hood buying these million dollar plus tract homes were either selling drugs or living on a trust fund. Okay, I know, “creative financing” and they traded up from a previous bubblelicious home. But honestly, even if you made 600K flipping a “starter home”, how on earth could you afford a 1.6M home? That means you’ve got a million dollar mortgage and paying 25K a year in taxes. Insane. We never have had the salaries in SD to support this kind of craziness.
I confess to a certain amount of Schadenfreudic fascination with the sinking high end of the San Diego housing market. Since earlier this morning, I took the time to take a more careful look at this. Here are the April DataQuick numbers for the five San Diego zip codes reporting $1m+ median sale prices for either April 08 or April 09:
Area Zip 4/08_Sales 4/09_Sales Median_08 Median_09 PctChg
Coronado 92118 16 16 $1,262,500 $1,002,500 -20.6%
La Jolla 92037 50 39 $820,000 $1,065,000 29.9%
Point Loma 92106 17 11 $1,319,750 $629,000 -52.3%
Rancho Santa Fe 92067 8 17 $2,887,500 $2,117,500 -26.7%
Del Mar 92014 19 10 $1,900,000 $855,000 -55.0%
Big ouch on those price changes for Point Loma and Del Mar, though it is impossible to tell from the numbers in today’s SD Union-Tribune to what extent this is due to shifting down from SFR sales to condos, as they are now lumping it all together. Similarly, the big increase in the La Jolla median may be due to shifting away from condos and towards heavily discounted $1m+ SFRs.
The above is just background information for the back of the envelope analysis I conducted on the months of inventory on the market for these zip codes. I conservatively used the sum of MLS inventory plus that reported on ForeclosureTown dot com (conservative because there may be other sources of inventory not included, especially shadow inventory of vacant homes that banks are strategically hiding from consumers). Here are the results:
Area Zip_Code MLS ForeclosureTown Total 4/09 Sales #Months
Coronado 92118 273 100 373 16 23.3
La Jolla 92037 477 422 899 39 23.1
Point Loma 92106 104 96 200 11 18.2
Rancho Santa Fe 92067 311 197 508 17 29.9
Del Mar 92014 196 161 357 10 35.7
Total 1,361 976 2,337 93 25.1
A few highlights and explanations follow:
1) The inventory of 899 homes on the market in La Jolla must certainly be near a record (and again, this is conservative, as there are vacant homes not yet on the market plus other places people list homes for sale in this rapidly evolving market).
2) The 29.9 months of inventory for Rancho Santa Fe and 35.7 months of inventory for Del Mar certainly do catch the eye.
3) Overall there are 2,337+ homes on the market in these high-end zip codes, and less than 100 (93, to be exact) sold in April 2008. This implies there is over two year’s worth of high end inventory already on the market, with the Alt-A and prime reset/recast tsunami wave bearing down on the prime coastal areas where many people were enabled by bubble-era financing to buy homes they could not afford.
4) Given the massive inventory overhang with more to soon join it, further price declines in this top market segment seem inevitable. I know all real estate is local, but so far as San Diego county prices are concerned, the price levels in these five zip codes will persistently keep a lid on the prices of housing in all less desirable areas within a fifty mile radius, as nobody wants to live in a hot dessert if they can buy coastal housing within reach of cool ocean breezes for at or near the same price.
Do I need to even bother mentioning that I believe this will end badly?
“Do I need to even bother mentioning that I believe this will end badly?”
I think it will end rather well, though with the same outcome. This collapse will be a joy to behold. Timber!!!
Yes, a most positive outcome, indeed!
BTW, we frequently drive these areas just to keep an eye on things “on the ground.” We’ve seen quite a few properties that were not listed anywhere — pocket listings, for whatever reasons.
If you look at all the most expensive listings, too, you’ll see that most of them were purchased at or near the peak and the “owners” have now listed them for much higher prices (!?!?!?!). All kinds of crazy stuff going on in the higher-end communities, and there is some price compression going on with the high/mid to high-end properties, putting downward pressure on the mid-mid/high-end properties.
It is coming, IMHO.
Thanks for the numbers. Unbelieveable stats in SD high end.
Like always, I will air the highly controversial opinion on the whole Memorial Day thing.
I think people who serve rank and file are complete mor*ns. They are merely tools for the PTB.
Privatize the profit, socialize the losses (and give them a worthless medal to boot or some such nonsense.)
This is not a diss on those people - they believe it to be heroism but they are only pawns in the real game. I actually like and respect these people but they are total and utter fools who don’t realize that they are being used.
There’s a whole wall of names in black stone in DC. What purpose did that serve exactly besides making some defence company board members and CEO insanely rich?
Disagree.
I didn’t see you offer up a coherent LOGICAL argument to disagree.
You can call me names but ya gotta back it up!
What bleedin’ purpose was there the precursor to that black wall of stone? Inform me.
I know who got enriched. Heck, I worked for one of them! They spit at the pawns, kid.
Hey Listen Puddy Kat, I am NOT your F_________ KId.
Meet me in a gym, and I’ll show you. I boxed for 10 years. Wanna go Puddy Kat???????????????/
So you STILL didn’t opt for logic?
SIGH.
Faster:
I think I overreacted to your comment, and I am sorry.
I usally agree with you on a lot of things FPSS. Not on this one.
After you get past the “radicalness” of my message, I suspect quite strongly, you will agree with it.
You are pulling a knee-jerk, lovely lady! Read one more time at its intrinsic logic.
Your instinctive defense of the institution is literally the same impulse used to manipulate the rank and file.
No my instinctive defense of the instution is not the same.
It was place for me to go for three years while I tried to figure out what I needed to do with my life. It also taught me how to work in a team (not the team building exercises offered at your nearest work place). After the 2nd year I knew this would not be my career. I knew exactly what I was getting into. So this pawn removed herself from the game.
So, Ms. Ex-Pawn, where exactly did you disagree with me?
Once I got my knee to stop jerking and kicking me in the butt, I let logic take over
After the war in Iraq I can see where FPSS comes from.
I talked my brother into leaving the military shortly after GW came to office because of my fear of his ignorance and his ties to money in oil, and the military industrial complex. He was strongly considering making it a career. I’d be vomiting if he had died in Iraq.
And my best friend’s brother did die in this war, and I will never forget my uncle talking about his best friends (plural, yes - ALL dead) in Vietnam.
Sorry, I stick by my (highly logical) opinion since I know the criminals have gone on to highly lucrative careers.
I disagree, and these people you speak of offer their lives for your right to say it.
I agree and disagree at the same time.
I agree at your general principle and respect that.
However, a whole generation got slaughtered at Vietnam for ZERO purpose. Unless, you can defend that logically, you are both a total tool and a fool.
Oh, and to think globally (= outside of Americanism), remind me what was achieved by whom during WW1. Again, the various armies were total tools and fools.
Robert McNamara, probably on par with Rumsfield as the worst Secretary of Defense in this nation’s history, admitted twenty years after Vietnam had ended that he knew all along the war was unwinnable and a folly. And yet like the craven moral cowards on the Joint Chiefs of Staff and the “perfumed prince” military careerists, they kept the slaughter going for year after year. What a waste of so many lives, blood, and treasure.
The two of them along with Kissinger are about as close as anyone gets to outright amorality.
Emotion has nothing to do with intellect.
Hence, you should manipulate “emotion” - isn’t that what the housing bubble was about? - “Buy now before you are priced out forever”, etc.
Humans can be manipulated in any sphere - particularly when you pull out abstract terms like “honor” and “decency” and “righteousness” - all totally meaningless.
Remember that the Germans pulled out the same terminology as the Americans during WW2?
And that a cr@pload of humans died during WW1 for their “honor” - remind me again in slow words what exactly they were fighting for? What was the purpose? The goal? What was going to be achieved by EITHER side by winning?
The military populace is filled with only two entities - the deceivers and the deceived.
You know Faster, you are obviously more intelligent than I, and I mean it. Starting from that point, I understand your position.
However, if, we fail to recognize people going to serve our country, because they have more balls than the rest of us, (me included), what is there left to recognize? They thought they were serving there country, and were Man and Women enough to do it.
Isn’t that it?
there=their
I respect the people who serve the country.
If they are going to die, there must be a logical objective not a bullsh*t one that enriches a buncha corporations.
I will stick by my (extraordinarily strong) logic that they (= rank and file) are being totally deceived unless you give me a coherent argument to the contrary.
They thought they were serving there country, and were Man and Women enough to do it ??
Not when you are drafted….
Like Yogi said, “When you get to the fork in the road, take it”!
scdave:
They still DID it!
Everybody chill.
Sit back, relax, and think of your favorite Will Smith movie.
OK Muggy..
They still DID it ??
They did not have a fricken choice you moron…It was either go fight, go to federal prison or leave the country for ever… Choosing to fight in a selective intervention war and die is one thing being randomly selected against your will is quite another…
I should add that LBJ said, ” I don’t want to be the first President to loose a war.” This was in the Pentagon Papers.
I don’t even know where to start with that.
I had a cousin and an uncle in that war and also Korea. They returned alive and apparently in reasonably good condition. No, they didn’t want to go.
Was it a useless killing spree? I have a friend who served in the Vietnam War, and he says it was. He would completely agree with FPSS. I was too young or they would have had me go to. I was 17 when it ended. I enlisted in the Marines one year later. I served honorably and peacefully. I also slept outside a lot.
I know Vietnam forever changed America for good and/or bad. We still can’t believe our government or news media.
I also know this: We need a draft so that our whole population is on the hook. I have sons that are becoming draft age, so I’m real about this. We really need the rich and super rich to realize that America is not just about them. We do not need any more useless wars fought by a professional army. Of course, we had Vietnam fought by draftees. There are, apparently, no guarantees.
Think about it. Jimmy Stewart was a bomber pilot during WWII. Have you seen Tom Cruise or Paris Hilton actually doing any fighting?
Hmm, one point though: One needs a high school diploma to be in the military. Paris would need to go to the “Special Platoon” for her GRE.
Roidy
“Think about it. Jimmy Stewart was a bomber pilot during WWII. Have you seen Tom Cruise or Paris Hilton actually doing any fighting?”
Great point. But…I can’t believe I’m actually going to defend those two! *gag* At least Tom Cruise and Paris Hilton aren’t doing any recruitment ads (unless you wanna count “Top Gun”). I think a more egregious example is Kid Rock, currently featured in a recruitment commercial designed to make the military look cool and hip to the kiddies.
If Kid Rock thinks it’s so great, why doesn’t he join up?
Favorite Will Smith movie for me:
Men In Black
I’m thinking more of the movie, “The Best Days of Our Lives,” in which Homer, the sailor who lost both arms in WWII, is basically called a sucker by a middle-aged guy sitting at the drug store counter where Dana Andrews works as a soda jerk. Of course, I cheer when Andrews mixes it up with the guy, and loses his job as a result; but the really cynical part of me says, “Dude might have had a point.” The wife thinks it’s endearing, I suppose, when I crack up at various scenes in the flick. Can’t help it, though. You know us Irish: We’ll cry over a card trick.
Can’t help it, though. You know us Irish: We’ll cry over a card trick.
Oh, you weepy Irish…
Actually, the other day I cried at an estate sale. Not like all big whoopy bawls and stuff, just a sniffle. Hey! It was sad! I bought a shoebox of old photos, with nary a name or date on most all of them, all those earnest faces squinting into the sun, many farmhouses, little boys standing proudly with daddy, little girls in Sunday best… I had the entire life-history of someone in my hands, and no way to know anything about it, and who these people were, or anything at all.
I thought, ‘If I threw this in the fire, it would all be gone. The record of a whole life.’ And then I thought ‘But if I did it wouldn’t matter anyhow, because it’s gone anyway. No one knows whose these people are. This record has passed beyond the grasp of any descendants, if there even were any. They don’t know. IIIII don’t know, either, and I never, never will.’
So then this made me mad and I stopped crying and felt like beating someone up.
(Which, come to think of it, is also quite like the Irish. Hahahaah!)
Many of those people on the black stone in DC did not serve voluntarily.
And THAT is the difference today….why no protests at the Washington Monument?
Why were there no Rock or Folk Bands supporting Cindy Sheehan?
Because her son Volunteered!
I think we should re-institute the draft because we have dumbed down our kids so badly with the poor schools, and the crap rap and hip hop music, do you really want them to take over?
But that’s the point. They CAN’T take over.
Only be forever controlled by the PTB.
Faster, I am surprised there aren’t already a million angry posts on here after that one, as it is a religion in the US to “support out troops” no matter what. Maybe there would have been more if you had dropped that bomb on Memorial Day, tomorrow. But, I have to say that I mostly agree with your sentiments.
WWII was arguably the last war this country fought that indeed lived up to our ideals of supporting liberty and freedom. Since then, our military actions have been interventions in another countries civil wars that we had no business participating in, or undeclared wars supporting the interests of the military-industrial complex to the detriment of the local population. The founding fathers would probably have been horrified at most of these.
Putting aside those reasons for not serving, however, simply looking at the horrible record of the government and how it treats current and former soldiers should be enough to keep anybody from enlisting. I mean, we can pay Halliburton employees many times the average soldiers wage, but we can’t even pay for body armor for our own troops? You are forced to serve additional tours of duty, more than you originally agreed to, with no recourse. You get wounded in combat, and then come home to receive a bill for your medical care, for thousands of dollars? The examples are numerous. All this stuff is all over the news, and how people can read those stories and still decide to enlist is beyond my understanding.
I have to say that you are over the line calling them “complete morons”, however, just because the usual age of enlistment is so young. It’s hard for me to blame some 18 year old kid for buying all the flag waving b.s. they have been indoctrinated with since childhood, esp. if their family is a military family. History education in our public schools is so poor that most kids wouldn’t even know anything of American military history, and instead just know the recruitment ads. If they were trying to recruit 30-year-olds with some life experience, instead of kids fresh out of high school, they would have a much harder time of it.
I think Bosnia was honorable even if it was too late, and my generation should FOREVER be tainted for not intervening in Rwanda.
As for the “complete morons”, c’mon man, even a cursory glance should show you that that is the frustration of a failed idealist!
FPSS,
You’re 100% dead on. I’m so frickin’ fed up with the sanctimonious hero worship nationalism cloaked as patriotism and that #@%$#$ flag worshipping has got to end someday.
And before one of you internet tough guys starts yapping, I did my “patriotic” (idiotic) duty and served.
“WWII was arguably the last war this country fought that indeed lived up to our ideals of supporting liberty and freedom.”
Sorry that I let myself get dragged into this off topic discussion, but revisionist history is a pet peeve of mine. Consider the implications of this account from a WWII veteran.
Archived Story
Rankin’s lone vote against war an intelligent decision
By MERREL CLUBB
Kim Briggeman’s Dec. 8 article beginning on the front page of the Missoulian recalled another sad and dark Dec. 8 when President Franklin Roosevelt asked Congress to declare war on Japan, and Congress, after barely 18 minutes’ debate, voted almost unanimously that the United States was in a state of war with Japan, in effect a war of revenge for Japan’s Dec. 7, 1941 attack on Pearl Harbor, which killed 2,403 Americans. Montana’s representative, Jeannette Rankin from Missoula, cast the only vote against the war.
In his article, Briggeman captured the loneliness and isolation that Rankin must have felt when she cast her solitary vote, one against 470 other members of Congress, a vote which set her in opposition to public opinion throughout the United States, including the people of Montana and her local constituency in Missoula. Her lonely vote took far more guts (I use the term advisedly) than it took for those men who “swamped” the recruitment offices in Missoula the day after the declaration of war.
Many of the men who flocked to “join up” over the next weeks and months of course volunteered for service out of feelings of patriotism, but many more as time went on enlisted for the adventure, to escape the draft, to break a routine, to escape the Depression and to find a job. Others joined one of the services because everyone else was doing it . I was one of those but most young men waited to be drafted.
Roosevelt’s short address to Congress on Dec. 8, a masterpiece of rhetoric with such expressions as “a date that will live in infamy,” “suddenly and deliberately,” “premeditated invasion,” “this form of treachery,” “surprise offensive,” “unprovoked and dastardly,” was designed to stampede Congress and the American people to gather behind him in a war against Japan.
But the attack was not “unprovoked and dastardly.” Japan had been dependent upon the U.S. for years for raw materials, especially oil. However, in July 1940, the United States began restricting export to Japan of aviation fuel, oil and scrap metal. The restrictions soon became tighter and tighter.
Later in 1940, Roosevelt extended the ban to include all scrap steel and iron. In July 1941, the noose was tightened again by freezing Japanese funds in the U.S. and by even tighter restrictions on gasoline and heavy oil. Roosevelt was careful to make clear to Japan that he did not intend a total freeze on oil. Nevertheless, all this was interpreted by Japan as a total embargo and led to the attack on Pearl Harbor.
If you don’t want to listen to the whole interview, the last ten minutes are most relevant to the discussion here.
P.S. Merrel Clubb makes a very good point about revisionist history: All work done by historians is inherently revisionist. What a thought-provoking interview!
The above post will not make much sense outside the context of another one regarding a YouTube interview with Merrel Clubb on his book, A Life Disturbed. It is easy to find on Google in case the link does not go through…
One reason you don’t see a million angry posts bashing FPSS’ controversial opinion is that most readers here are pretty smart; we recognized our knee jerking emotional reactions, and took a moment to think about FPSS’ comments. We could judge for ourselves whether his/her comments made sense, and don’t really need to resort to anger to express our opinions and emotions.
RE: WWII / Greatest Generation, etc:
I just posted a link which may not make it through of a veteran describing the autobiography he wrote about his WWII experiences. This is one of the most honest and forthright perspectives on war that I have ever heard expressed, and I highly recommend listening to at least the last ten minutes of this interview if you have the time and interest…
www dot youtube dot com slash watch?v=uiHz9PRQIBo
Ballsy post FPSS….but sadly true. Our wars are fought for monetary interest and gain for the lords of the universe…..not for ‘Freedom’.
Glad someone had the chutzpah to say what FPSS did. Bravo.
Many Americans (like myself) consider recent US wars to be immoral and completely unnecessary.
Some Americans will spend tomorrow wondering why certain American war-criminals still roam free.
I agree with FPS.However people are diferent and some feel quite confrotable in the millitary.
IMO they should make anybody, who wants to enlist, read Catch-22 and write an essey before alowing them to sign in.
—————————-
“I’m nuts. Cuckoo. Don’t you understand? I’m off my rocker. They sent someone else home in my place by mistake. They’ve got a licensed psychiatrist up at the hospital who examined me, and that was his verdict. I’m really insane.”
“So?”
“So?” Yossarian was puzzled by Doc Daneeka inability to comprehend. “Don’t you see what that means? Now you ca take me off combat duty and send me home. They’re not going to send a crazy man out to be killed, are they?”
“Who else will go?”
Catch-22, Joseph Heller
I knew my parents shouldn’t have let me read that book when I was 12.
“Men at Arms” by Evelyn Waugh is another one that should be a required reading for anyone that considers military carier.
FPSS…. Wow..I just came back from a quick visit to see Woods National Cemetery to check things out while it was quiet.
“I think people who serve rank and file are complete mor*ns. They are merely tools for the PTB.”
“This is not a diss on those people they believe it to be heroism but they are only pawns in the real game. I actually like and respect these people but they are total and utter fools who don’t realize that they are being used.”
FPSS, I read what you wrote and you’re wrong on this one.
It was an intentional, well-thought out and a purposeful provocative attack…especially on the enlisted ranks that served in the US Military and their familes. That may just beyou are and your reasons are your own. I don’t mind that, but I am a little disappointed in your lame attempt to disguise THAT PART OF THE LIE.
It’s okay to say you hate wars - most sane people do.
It’s okay to say you hate our gov’t for getting us into unneceassary wars. Lots of people do.
You should have heard what I said to God, the president, draft boards, mom, country, and apple pie under my breath in the heat of a fight. Blame whoever you want to up the chains of command on both sides but not the troops. We arm them and we send out them onto the lines of fire.
As for the names upon the black granite wall below Foggy Bottom, DC. They weren’t complete utter fools, tools, pawns or complete mor*ns. Far from it, they did what our country and it’s laws at the time required and even demanded.
I believe it was any combination of 6 years active, reserve, NG or Inactive Ready Reserve duty for physically and mentally fit males without a college or some other special military deferments. That or going to jail or Canada.
I have a lot of friends on that wall, mostly US paratroopers and marines along with a few navy and USAF that would have just as soon lived long product happy lives. Unfortunatly, they just didn’t make it.
They were, like in previous wars, some of our friends, sons, daughters, brothers, sisters, uncles, aunts, dads and moms that, right or wrong, were caught in the wrong place at the wrong time and they paid the ultimate price for OUR putting them THERE. That, along with our US Gov’t, it is WE the American people, not them, that are responsible FOR the end results and the consequences of our wars.
My issue with your post is you don’t stick a knife in someone’s back, twist it and the same time and breath say, “Hey man..no disrespect, you are a complete mor*on and a tool, BUT ” I really like you”. On that, I will call you out.
I’ve known you and enjoyed your imput and humor for a long time and I hope to continue but I wish you wouldn’t call American service people and veterans fools, tools, pawns and mor*ns…and then say “you like and respect us.”
They and their families deserve a lot better than that your “highly controversial opinion” that serves no purpose other than to hurt or inflame someone, this close to Memorial day.
FPSS…feel free to call me a fool or a tool for saying all this if you like, as it doesn’t really bother me. I would though, ask you to show a little class and cut our American dead, the wounded and their familes some slack though through the weekend. Of course…that’s up to you.
mikey
Email me offline, and I’ll tell you a few things that I am not comfortable stating in public.
Sorry, I stand by my opinion.
BTW, mikey, I want you to reread my posts AFTER your initial emotional response has dissipated.
I suspect you will agree with me. In fact, I am quite sure of it.
Read it again, minus the emotionality.
FPSS,
No email is necessary. Your opinion is your own. I guess I’m just a little disappointed in your timing, reason and terminology. I took a neighbor out there with me to see her nephews grave. He passed away of 22 years ago and she still likes to keep his family in Florida informed of how they take care of his grave and Wood Cemetery on Memorial Day weekend. She’s almost 85, uses a stroller and still “misses that kid”. I didn’t know him.
It’s no big thing, just forget it.
Mikey, my take on this here is God Bless You and Faster both, and I am out of here.
There’s a whole wall of names in black stone in DC. What purpose did that serve exactly ??
I have always thought its purpose was to remind us how we should not ever again get into elective, intervention wars…Obviously, we did not learn from it…So, I agree, its mainly about money…
Architect turns a closet into his living quarters in Delray Beach
By Charlyne Varkonyi Schaub
Sun Sentinel
Saturday, May 23, 2009
DELRAY BEACH — Sergio Santos is used to facing challenges as an architect.
The 39-year-old Brazilian has designed college housing projects in England, two high-rises in Poland, an office building in Turkey and a mall in Germany.
But when he lost his job as an architect in January, he faced one of his biggest design challenges.
By March, he realized he could no longer afford to pay $500 a month for the 17-by-15 1/2 room he rented in Boca Raton. So he found a job as a waiter to pay the bills and negotiated with a Delray Beach landlord to rent a room that’s smaller than many South Florida closets Ä” 5 1/2 by 14 feet. It’s so small that he can touch both walls if he stretches out his arms.
“The landlord had a larger place available, but he wanted $350 a month,” Santos said. “I asked if he would rent me this small room that was a place for the telephone, Internet and security system. I pay only $150 a month and I love it.”
The room, which his friends have nicknamed the Recycled Submarine, Matchbox and Corridor Room, now serves as his bedroom, office and mini kitchen.
He estimates the makeover cost him only $64 Ä” for screws, bolts, nails, glue, braces and a hammer. The room is not only inexpensive, it’s eco-friendly.
How’d he do it and I want one!
For many soldiers on deployment, 50 packed into a room the size of a large living room is “living large.” I guess it is all persepctive…
Uh, one word: bathroom?
“The 39-year-old Brazilian has designed college housing projects in England, two high-rises in Poland, an office building in Turkey and a mall in Germany.”
After all that he should be able to afford a bathroom. I guess office buildings in Turkey just don`t pay what they used to. But if he doesn`t take better care of his money as a waiter, he will be designing a Maytag box by the interstate.
Obama says we’re out of money?
SCULLY: Yet, it all takes money. You know the numbers, $1.7 trillion debt, a national deficit of $11 trillion. At what point do we run out of money?
OBAMA: Well, we are out of money now. We are operating in deep deficits, not caused by any decisions we’ve made on health care so far. This is a consequence of the crisis that we’ve seen and in fact our failure to make some good decisions on health care over the last several decades.
So we’ve got a short-term problem, which is we had to spend a lot of money to salvage our financial system, we had to deal with the auto companies, a huge recession which drains tax revenue at the same time it’s putting more pressure on governments to provide unemployment insurance or make sure that food stamps are available for people who have been laid off.
So we have a short-term problem and we also have a long-term problem. The short-term problem is dwarfed by the long-term problem. And the long-term problem is Medicaid and Medicare. If we don’t reduce long-term health care inflation substantially, we can’t get control of the deficit.
http://www.c-span.org/pdf/obamainterview.pdf
Where’s OLY when ya need her…?
From the Orange County Register.
http://www.ocregister.com/articles/home-palmer-house-2425795-sunny-family
Anybody think the reporter forgot to ask a few key questions?
It took 10 years for Kevin Palmer to save $30,000 for his dream house, and less than a year to burn through that much as he fought to keep it.
Palmer, 49, still is struggling to pick up the pieces, looking for work and living at Mercy House, a transitional housing shelter in Santa Ana
He survives on weekly $235 unemployment checks and drives a 1991 Toyota Tercel with a shattered window. His Mercy House room costs $225 a month.
Less than a year and a half ago, Palmer was making $70,000 as a property manager and living in the condo he bought in 2000 for $198,000. For years, he had handily made his $1,275 mortgage payment at a fixed rate of 12.75 percent.
A health issue he declined to discuss forced him to take out an adjustable-rate home-equity loan to pay for drugs that weren’t covered by insurance.
In January 2007, Palmer got a letter from his lender telling him his mortgage was going up to $2,850 per month. The higher payments started depleting his savings.
Then, in June 2007, his mortgage payment was adjusted upward again, to $3,550. Palmer couldn’t afford it.
After burning through most of his savings, he defaulted on the loan and was told to leave his home by late January 2008. …
He moved into a windowless, 8-by-12-foot office suite in Lake Forest and showered at a gym until he landed the room at Mercy House. He continues to look for work and has filed for Chapter 7 personal liquidation bankruptcy.
This story clearly illustrates that so many Americans who are successful and make above the median wage often think it will last forever and never save for that rainy or if they do, blow it all on a major purchase or “investment.”
I’ve known many people like this. It’s hard to see them cope with brutal reality… until I remember what cocky, self righteous SOBs they used to be.
According to a Readers Digest Article some years ago, 60% (that’s right, 60%!) of all Americans will experience poverty at least once in their lives.
Mom told me yrs later, after the fact, that she had to live in her car after the newspaper she worked for closed. That was in the late 80s. I never knew, and feel badly that I wasn’t aware so I could help.
Pride goeth before the fall. Or some such thing.
Pride is something that is very weighty.
Dangit! Another lost post.
I just can’t get my head around the latest spin:
1) “The recession is ending.” I don’t even need to post a link for this one. It’s all over the place.
2) “There will be a robust turn around in housing later this year.” I’ve looked for a link on this. It was said on Bloomberg a few days ago. Please help.
3) “We need inflation. That will fix everything.” I do have a link for this one. http://www.bloomberg.com/avp/avp.htm?N=av&T=Ablin%20Says%20Stock%20Valuations%20Reasonable%2C%20Momentum%20Needed&clipSRC=mms://media2.bloomberg.com/cache/viCb11JVUwPU.asf
It looks like there is a real deflation expectation that is causing contradictory economic data. This data is then spun like there is going to be a wonderful blue sky recovery. We are entering a deflation period which all of Ben Bernanke and his idiotic money printing cannot change. People will not assume more debt. That is what the original problem is and has been.
Ben -our Ben, the good, smart Ben - said it years ago, and so did a host of other bloggers and economists. Debt is the problem. “Cheap money” and “trees to the sky” will be a disaster. I got it.
Inflation or not, I’m not assuming any more debt. I’m becoming ever more alarmed that the Gov’t Treasury, FDIC, FED, Wall Street, etc. do not understand what is actually happening. What’s worse, they think they are right.
I keep thinking back to Mr. Magoo’s “conundrum” remark in 2004. What Al meant with this was, “I’m screwing around with something I know nothing about. I also don’t want to think too hard about it, either.” ( This is when Greenspan raised the FED rate and long term rates subsequently dropped. He was surprised. Go figure.)
I’m not optimistic. My bet on the “next shoe” would be the eastern Europeans. They are a mess.
Roidy
eastern Europeans. They are a mess ??
Yes they are along with everybody else but Spain could be the worst…
Watson paid pittance for taxes on ‘nonexistent’ Detroit house
BY M.L. ELRICK and NAOMI R. PATTON
FREE PRESS STAFF WRITERS
Detroit City Councilwoman JoAnn Watson paid only $68 in property taxes this year because city records say her well-kept, brick Tudor-style home doesn’t exist. Although the home has occupied its west-side plot since 1926, city records have classified the parcel as an empty lot for the past decade.
Watson said she was unaware of the discrepancy until the Free Press contacted her. She said the change came before she was elected to City Council — and without her involvement.
“I pay the taxes. All I know is I had a big drop when my house got hit hard by a tornado,” she said. “We had great damage.”
Watson said she could not recall the specific date the tornado hit, saying it might have been 2002, or perhaps 1993.
For democrats in this administration, taxes are for the little people.
Here’s the link……it’s a very nice house.
http://www.freep.com/article/20090524/NEWS01/905240505/Councilwoman+Watson+paid+68+in+property+taxes+for+this+house
“I pay the taxes. All I know is I had a big drop when my house got hit hard by a tornado,” she said. “We had great damage.”
“Watson said she could not recall the specific date the tornado hit, saying it might have been 2002, or perhaps 1993.”
Lying crooked b!tch! If a tornado did a lot of damage to your house, you would not only know the year, but the exact date.
She also intimated that the story was a put-up job by the press to “smear” her. I am local, although not a Detroit resident, and am disgusted by her attitude. Telling the job is not a “smear” job. The taxes on that house should be about $6K in Detroit. Just another leftover whore from the Kwame administration who needs to be ducked in the Detroit River until she tells the truth. Geeze. And you’re right, it’s a very nice house.
scdave: I see your point on some of that.
Hey scdave, now that I am not mad at Faster, I am mad at you. You wanna go the gym???
Speaking of armed conflicts and such..
I would like to announce that last week, I was hired to work on a class action lawsuit against Countrywide.
As a loyal and long time reader of this blog, I will endeavor to create as large a thorn in the side of Mozillo and his ilk as humanly possible.
It will be my pleasure.
RR Refugee:
I am an attorney. Are u expert witness, lawyer, paralegal, what? Really curious to know more.
Thanks,
ATE-UP
Really good at using litigation support software (Summation, Concordance, CaseMap, etc).
I like to think of it as looking for the pony underneath all the sh*t.
Way to go, RE Refugee!
Go get ‘em!
Thanks for the reply. Wish you were on my team.
Awesome. Though I don’t have a Countrywide mortgage, I would be thrilled at any news that Godzilla gets his come uppance for the role he played in sinking Bank of America’s off-balance sheet.
I DO have a Countryfried mortage.
Your ‘thrilled’ emotion, PB, would be as a tiny little sno-cone in H*ell conpared to the riotous blaze of joy and satisfaction that IIIIIII would feel if I ever were to witness the Orange Freak in manacles…
…Oh, gosh, I ’bout fainted with joy right off my chair just thinking about it, and if I had, I’d a spilled my beer! (Just another horror I would have chalked up to Mozilo, had it happened.)
Now, I admit, I am not personally experiencing any difficulties and I successfully resisted the astoundingly strenuous attempts from CW agents to get me into an Option ARM-loan. (A simple 30 year fixed, that I may or may not pay off early, I’m still thinking) But they TRIED, is my point, with threats and pretense, and they succeeded with many other iggerant and less-lucky and willful persons. Countrywide has harmed very many, and not all of those many deserved it. They were and are lying greedsters, suckling parasites.
Oh, yeah, and Mozilo’s icky face offends my eyes.
So, that’s reason enough for me!
Sorry — many condolences…
Thanks.
But Oly, I thought this mess was caused by greedy, uneducated buyers who weren’t pressured and misled and threatened by the sales reps?
I’m shocked that there was fraud going on! Shocked I tell you!
Don’t know if this is limited to CA or not.
If you get a class action notice, answer it. It’s a good case.
“Though I don’t have a Countrywide mortgage, I would be thrilled at any news that Godzilla gets his come uppance for the role he played in sinking Bank of America’s off-balance sheet.”
Could we just send him to the gym with ATE-UP?
Our mortage was bought by Countrywide and boy was I unhappy about that. They ( well, B of A ) still have it, too.
As a loyal and long time reader of this blog, I will endeavor to create as large a thorn in the side of Mozillo and his ilk as humanly possible.
And you gotta tell us all about it, huh huh huh?! Yes!
*claps hands eagerly and bounces up and down in splintery wooden chair *
WHOA! Watch that beer!! Yer gonna knock if off the table!
That would be criminal!
Wasted beer - what is this world coming to?
RER: you go girl/guy! Keep us updated.
Forbes dot com
Real Estate
Where U.S. Homeowners Are Most In Debt
Matt Woolsey, 05.11.09, 04:00 PM EDT
Ten metro areas with the most underwater mortgages.
“Water, wealth, contentment, health” is the motto of Modesto, Calif., a mid-size Central Valley city of 210,000. Problem is, it hasn’t been a positive year by any of those measures.
The state is in a two-year drought. The violent crime rate is 45% higher than the national median, according to the FBI. This is not a particularly healthy place to live.
As for wealth and contentment, Modesto ranks as the worst city for homeowner debt. Household wealth has been reset to 2001 levels while housing prices have declined 57% since the peak in 2005, and 30% in the last year alone. This has dunked 81% of the last five years’ mortgages underwater.
In Depth: Where American Homeowners Are Most In Debt
Modesto’s not the only California metro area suffering. Our top 10 includes seven Golden State cities such as Riverside, Yuba City, Merced, San Diego, Stockton and Vallejo. In these cities, underwater mortgages–one on which more is owed than the home is worth–comprise an average 44% of outstanding mortgages, compared to the 29% nationwide average.
Not sure how Zilldo came up with a median San Diego home value above $350,000, given that the recent median sales price has been consistently below $300,000…
“Our rankings for homeowner debt measure the total number of homes in negative equity, giving extra weight to the number of homes bought in the last five years that are currently underwater; the last measure shows which areas have experienced the most recent strain. Both first quarter 2009 data are from Zillow.com, a Seattle-based real estate research firm that examined the 161 largest U.S. metropolitan statistical areas–geographic entities defined by the U.S. Office of Management and Budget for use by federal agencies in collecting, tabulating and publishing federal statistics.
10. San Diego-Carlsbad-San Marcos, Calif.
Median home value: $352,938
Decline in last year: -18%
Market peak: Third quarter, 2005
Total percentage of underwater mortgages: 32%
Loans taken out in last five years currently underwater: 63%
Source: Zillow.com”
And Bernanke said it was all contained!! LOL!
Sumfing tells me BB has never set foot inside the city limit of Modesto, CA.
“Bernanke said…”
It’s all good! California is too big to fail, and all these articles about underwater mortgages prove it. Since the Treasury and Fed set the unsavory precedents of bailing out Wall Street and Detroit for no good reason whatever, it appears to now be California’s turn. Otherwise the green shoots will soon whither and die in the hot, dry California sun.
My new advertisement in local paper:
Hey!, always had that itchin’ to be a Moron!? We Can Help! Dial 1-800-ATE-UP.
Can anyone figure out how to access this article? The title sounds so enticing, but when I go to the link on the North County Times web site, it says the article is no longer available…
REAL ESTATE: Renters find market stuffed with bargains
North County Times - May 21, 2009
Tenants who shop around can get bargains that weren’t available a couple of years ago. Lynn Hogan and her husband put their house in Bonsall up for rent …
Got it.
BTW, do UHS’s have to pass a stupidity exam to get their licenses? Check out the dumb remarks in this article…
REAL ESTATE: Renters find market stuffed with bargains
Landlords offering incentives for houses, apartments across region
By CHRIS BAGLEY - cbagley@nctimes.com | Wednesday, May 20, 2009 7:07 PM PDT ∞
Foreclosures have washed several thousand local families out of their homes in the last two years, but the resulting flood of empty houses has also brought the best prices in years, not only for buyers, but also for renters.
Rental bargains abound, both among houses and apartments. In a fight against vacancies, landlords are throwing in incentives and, in some cases, agreeing to lower monthly rents.
Monthly rents in single-family homes have fallen by 5 to 10 percent, based on interviews with landlords and property managers. Tenants who shop around can get bargains that weren’t available a couple of years ago.
Lynn Hogan and her husband put their house in Bonsall up for rent last month. It’s nearly 2,900 square feet, sits on top of a hill next to a horse ranch, and has sweeping views of the surrounding hills. A couple of years ago, they might have asked $2,500, Hogan said. In fact, they’re asking $2,100 and might go lower, Hogan said.
“People want a lot more for their money,” Hogan said.
To be sure, the recent discounts in the rental market are small in percentage terms compared with the 30 to 50 percent declines in home prices since the peak of the bubble three years ago. The phrase “affordability” came back into sales pitches last year.
“Why do you want to pay someone else’s mortgage?” asked Sean O’Sullivan, owner of Oceanside Sales & Rentals.
Even so, O’Sullivan estimates that monthly rents on new leases have fallen by about $100 in the last six months.
O’Sullivan and other real estate professionals estimate that monthly rent costs are 10 to 40 percent less than monthly mortgage payments for comparable houses. And for families whose savings or credit scores have shrunk in the recession, renting may be the only choice. Renting also still makes sense for people who know they’re going to stay put for less than a couple of years.
I just sent through a link to a copy of the article for you thats posted on another site. Hopefully it will go through. I used the Yahoo search engine to find it.
Thanks. Apparently if you search around on the NC Times archives, you can find these articles which are no longer linked on Google.
Your welcome, I love a challenge. I was hoping for some sort of conspiracy here though.
Condo buyers beware of broke HOAs.
HOUSING: Foreclosures overwhelm condo complex
Broke homeowners association late on water bill, residents face eviction
By ZACH FOX - zfox@nctimes.com | Thursday, May 21, 2009 10:44 PM
Just about all the problems wrought by the collapse of the local and national housing markets have converged on Brookhaven Condominiums, a complex in south Escondido.
A North County Times investigation that began in July has traced the demise of Brookhaven, a community emblematic of the nation’s housing bust: Born of a 2005 project to convert apartments to condos, the complex has since been plagued by subprime loans, foreclosures, failed loan modifications, inflated values, strange rent agreements on vacant homes and three real estate professionals charged with mortgage fraud in unrelated cases.
An astounding 15 out of 20 of the units are in some stage of foreclosure. Two others sit vacant.
There is only one owner who lives in the complex, Cruz Alberto Rangel.
He bought a home in the complex in 2006. He has made all his mortgage payments and homeowners association fees. Now, he faces eviction because all the foreclosures and vacancies have forced the homeowners association out of business.
I learned this when I was 21: NEVER buy a condo.
Will the U-T ever run a story on failed condo conversions? They were a huge cheerleader for this severely flawed product - driven by greed and doomed to failure.
North County Times
REAL ESTATE: Foreclosures, booming sales make predictions difficult
By ZACH FOX - zfox@nctimes.com | Wednesday, May 20, 2009 7:07 PM PDT
In a January story previewing the real estate market in 2009, the North County Times painted a murky picture of increasing sales mixed with falling prices and a disconcerting level of foreclosures.
Those looking for clarity as the summer homebuying season —- typically the high point for home sales —- approaches will be sorely disappointed.
In a sentence, prices and sales indicate a bottoming, even recovering, of home prices while foreclosures and unemployment suggest more pain ahead.
And even that vague, say-nothing conclusion oversimplifies the market, as lower-priced houses appear much closer to a bottom than those in the higher price ranges.
The case for a bottoming or recovering housing market is strongest along Highway 78 (Escondido, San Marcos, Vista, Oceanside) and Southwest Riverside County, where housing inventory —- the length of time to sell all active listings —- has dipped below three months. Six months is considered healthy; three months is screaming hot.
Over the past three months, 157 houses —- not including condos —- sold for less than $200,000 in Escondido alone, according to listing site Redfin. These homes are often 50 to 70 percent below the previous, bubble-era sales price.
For perspective, prices hit bottom during the last real estate recession in 1996, when the median price was 3.9 times the median household income and the typical mortgage was at 31 percent of income.
Areas such as Escondido and parts of Oceanside have approached that level, with median prices at about five times median income and historically low interest rates pushing the typical mortgage to roughly 30 percent of income.
However, the numbers flip-flop in high-end areas such as Del Mar and Rancho Santa Fe. Inventory has breached a new stratosphere at anywhere from 25 to 50 months to sell all listings. Meanwhile, median prices in Carlsbad and Carmel Valley are still 10 times income, and mortgages suck up 50 to 55 percent of one’s salary.
That suggests prices have room to fall in the upper end.
I never cease to be amazed over real estate cheerleaders who pose as academics. Why would anyone who actually understood squat about finance say that home prices are expected to continue falling and then suggest in the same breath that now is a good time to buy a home? Apparently Galuppo is stupido.
REAL ESTATE: If your life is stable, it’s time to buy
By LOUIS A. GALUPPO - For the North County Times | Wednesday, May 20, 2009 7:07 PM PDT ∞
Today’s market for residential real estate is made up of deals arising from broken loan modifications, short sales, foreclosures, bank owned properties, distressed sellers, receiverships and bankruptcy trustees.
This market is inefficient and chaotic. People want a bargain, and many are willing to wait for several months working through the short sale process. Others are willing to be a part of a frenzied bidding war over a bank-owned house.
…
On April 30, the University of San Diego’s Alan Gin released the Index of Leading Economic Indicators he compiles for the Burnham-Moores Center for Real Estate. Gin issued the stark report that “The outlook for the local economy remains strongly negative at this point, with no turnaround in sight.”
Regardless, there seem to be tiny points of light flickering in a very black sky.
…
Overall, market value will continue to decline, but at a slower pace, except for the periods of time when foreclosures are actually pursued in earnest. Areas experiencing a larger number of job losses may continue to have moderate price decreases. For the foreseeable future, the markets will be mixed, troubled and stressed.
Yet many are saying that we may be nearing the bottom of the residential real estate market for existing homes in San Diego.
So if buyers are looking at homes in a neighborhood and community in a relatively stable older market, and all things are steady in their personal lives, the time to buy may be close. If prospective buyers want to obtain homes in a newer area and their jobs are not stable, they may want to wait for a little while.
If buyers have not purchased anything within the next five years, they will probably wish they had.
Louis A. Galuppo is the residential real estate director at the University of San Diego’s Burnham-Moores Center for Real Estate.
The worst part of all is the pretense by these REIC cheerleaders that they can actually predict where price will be in five years. Imagine if a Japanese version of this guy had been telling prospective home buyers in Japan back around 1992 or so that they would regret it if they did not buy a home by 1997. Turns out that twenty years after their housing market started crashing, it is still trying to find solid ground at the bottom. There is really no predicting how long it will take the US market to bottom out, and anyone who claims they know is lying. Seeing academics pretend to be able to predict where the market will be in five years reminds me of some choice comments by my attorney father-in-law about his brethren in the legal profession who advertise legal assistance for accident victims on billboards.
The MTS buses in San Diego have this billboard on the back that says “ACCIDENTES?” With a Hispanic man holding his arms out with a crooked smile, and I thought Realtors were scum of the earth, these personal injury attorneys take it to a whole new level.
“Yet many are saying that we may be nearing the bottom of the residential real estate market for existing homes in San Diego.”
Standard propaganda line. Do any of them have any credibility?
Even if you want to save cash, don’t try this stuff at home
By SUSAN SAULNY
The New York Times
Sunday, May 24, 2009
CHICAGO — Saving money never cost quite so much.
When the toilet in Carol Taddei’s master bathroom began to break down a few months ago, she decided it would be cheaper to buy a new one than pay for repairs. Ever frugal in this dismal economy, Taddei, a retired paralegal, then took her economizing a step further, figuring she could save even more by installing the new toilet herself.
Initially, things looked good with the flushing and the swishing. That is, until the ceiling collapsed in the room below the new (leaky) toilet. Rushing to get supplies for a repair, Taddei clipped a pole in her garage. It ripped the bumper off her car, and later, several shelves that had been holding flower pots and garden tools collapsed over her head.
“It just kept getting worse,” Taddei said, ruefully describing what came out to be a $3,000, three-day renovation at her suburban Minneapolis home, finished by a professional from Mr. Handyman, a home repair service that takes emergency calls.
With the sour economy has come a class of ambitious do-it-yourselfers who are tackling things that, before the days of rampant penny-pinching, might have been left to paid professionals. An unlucky few like Taddei have learned that being thrifty sometimes comes at a high price and can bring along with it a new scourge of the times: saver’s remorse.
“Oh, tell me about it,” Taddei said. “Sometimes it’s better just to bite the bullet.”
D’ohh!
Knowing your limits is a good thing. We know our limits, and our limits are plumbing.
I was speaking with my apartment manager and she says the complex is full up– and she keeps getting walk-ins, most of whom are people who were renting houses and the owners went into foreclosure. “I only have three units opening up next month.” (One of them is ours.) And those moving out– are moving into houses.
In other news, we finally got our keys, and we are very happy to discover that not only is it a nice neighborhood, it’s a very friendly neighborhood, with about 60% original owners (25+ years.) Because they’re so friendly, we found out a few things:
1) The lady next door owned this house prior to the current owner, and kept it for her elderly mother. So that’s probably where all the roses and flowering shrubs came from.
2) When the house went into foreclosure, it was in worse shape than it is now. Despite its “as-is” status, the bank apparently decided that water damage was a no-go and did some major repairs. Since they did this last summer, these repairs have stood up to a typical winter without extra maintenance, which is nice.
3) Another neighbor has been mowing the backyard, which explains why there aren’t six-foot weeds. He did nothing about the bushes, though.
4) They like us. More specifically, they like the fact that we aren’t Section 8 renters (like the house next door to us was for a while) or short-term house trashers (like the prior residents of the house one over.) A lot of “investors” were looking at this house. Honestly, though, the value is in the lot size, not the house size, and there’s too much if you’re not there permanently.
So I’m tired, because there’s no help for us moving, and two adults + one toddler = one functional mover. And Olygal, since there’s too much toxic in the backyard for little man to ingest, I’ve got no pictures yet. But since I’m watching my parents’ place, I went in their backyard and took some pictures of the wonderful fruitless mulberry that my dad’s been shaping for 30+ years. There’s a cave below and a flat area above that can fit at least eight adults (verified.) I spent lots of summers up that tree. Can’t climb it the same way– I’m bigger, the hole is smaller, and I’m just not as flexible. But that’s why there’s ladders…
Good luck with your move! It’s not easy to do with kids.
In the past six months, most Washington area sellers have lost money on houses they purchased since prices started climbing in 2000, according to a Washington Post analysis of residential sales. In the first three months of this year, 62 percent of local home sellers accepted less than they paid for their homes, in part because aggressively priced foreclosures have dragged down prices around the region.
“If sales are not increasing and foreclosures are on the uptick, then the question is: ‘Is there another shoe to fall?’ ” Merchant said. “Maybe what we were hoping was the bottom was just a bump on the way down.”
Housing Bust Leaves Sellers at a Loss
Be still my beating heart. Has housing bubble reality hit the DC area?
you know things are bad when they quit watering the plants…
Five miles away, former indoor plant specialist Michael A. Jones is having what he calls “a humbling experience” at a nonprofit food pantry, choosing dented cans of corn and tuna, a crunched box of Rice Krispies and some soon-to-expire milk to supplement his food stamps.
Jones used to gross $12,000 a month as an indoor horticulturist for high tech companies, restaurants and car dealerships, although not Silicon Valley Auto Group. Then “everyone cut back all at once and we had to shut down,” he said. “It happened fast.”
$12K a month to take care of indoor plants as an “indoor plant specialist” ??! And he didn’t save any f—kng money ? My goodness. I haven’t been living right, I guess. And I slave away for for 1/3 of that and save half of what I earn. Who knew.
But then, I’m used to (non) dented cans of corn and tuna, and buy storebrand Rice Krispies, since I’m one of the Queens of Frugality. And I have no indoor plants.
This is interesting, but I don’t really get it. Why can’t CH just diversify across myriad different hard and paper assets (and aren’t they)? Of course they can’t summarily dump the dollar for some other portfolio mix without causing a major self-injuring market dislocation, but what is to stop them from gingerly tiptoe away from it?
China stuck in ‘dollar trap’
By Jamil Anderlini in Beijing
Published: May 24 2009 23:30 | Last updated: May 24 2009 23:30
China’s official foreign exchange manager is still buying record amounts of US government bonds, in spite of Beijing’s increasingly vocal fear of a dollar collapse, according to officials and analysts.
Senior Chinese officials, including Wen Jiabao, the premier, have repeatedly signalled concern that US policies could lead to a collapse in the dollar and global inflation.
But Chinese and western officials in Beijing said China was caught in a “dollar trap” and has little choice but to keep pouring the bulk of its growing reserves into the US Treasury, which remains the only market big enough and liquid enough to support its huge purchases.
In March alone, China’s direct holdings of US Treasury securities rose $23.7bn to reach a new record of $768bn, according to preliminary US data, allowing China to retain its title as the biggest creditor of the US government.
“Because of the sheer size of its reserves Safe [China’s State Administration of Foreign Exchange] will immediately disrupt any other market it tries to shift into in a big way and could also collapse the value of its existing reserves if it sold too many dollars,” said a western official, who spoke on condition of anonymity.
CItation: Financial Times
Financial Times
Chill wind blows for triple A nations
By David Oakley, Capital Markets Correspondent
Published: May 24 2009 18:13 | Last updated: May 24 2009 18:13
Rich countries face a threat to their status as the safest places to invest after the UK was warned last week that it could lose its top-notch credit rating.
The triple A club of countries with the highest quality credit ratings has shrunk this year after Spain in January and Ireland in March were downgraded by Standard & Poor’s because of worries over their economies.
Fears have grown that other big economies, such as the US and Germany, could be in danger of downgrades after S&P’s decision to lower the UK’s credit outlook to negative from stable.
John Wraith, head of sterling rates product development at RBC Capital Markets, said: “The world is a different place now. We have seen Spain and Ireland lose their triple A status this year, and the UK could be next if the government doesn’t fundamentally address the underlying situation with increased fiscal rigour.”
S&P’s decision on the UK was based on concerns that government debt could grow to unsustainable levels and have ramifications for the country’s economy.
After Thursday’s announcement of the outlook downgrade, yields on the UK’s benchmark 10-year bond rose 7 basis points.
By Friday prices on 10-year gilts had fallen to their lowest in three months.
However, analysts do not believe that the other triple A nations among the G7 – the US, Canada, Germany and France – are in as great a danger as the UK of losing their triple A status.
Even though the UK has a much lower debt burden than other economies, its public finances are more exposed because of the higher risks that international investors, who hold about 40 per cent of the gilts market, will be forced to sell since many are only allowed to hold triple A debt.
The OECD expects gross government debt in the US to reach 78 per cent of gross domestic product this year compared with 64 per cent in the UK.
However, the US is able to run up much higher debts because it has the luxury of the dollar being a reserve currency.
Luo Ping, of the China Banking Regulatory Commission, has said: “We could happily reduce our gilt holdings, but not US Treasuries. They are the safe haven. For everyone, including China, it is the only option.”
Here is some unpleasant handwriting on the wall for those in govt pension plans…
Financial Times
ECB staff to strike over pensions
By Ralph Atkins in Frankfurt
Published: May 24 2009 22:29 | Last updated: May 24 2009 22:29
Staff at the European Central Bank have called their first strike, in a protest over planned changes to their pension scheme.
A 90-minute warning strike will take place on June 3, just as the ECB’s 22-strong governing council arrives in Frankfurt for its monthly interest rate policy-setting meeting. The ECB said it would ensure that essential central banking activities were maintained during the protest action.
Staff at European institutions are generally regarded as enjoying good benefits as well as job security. But the strike marks a heightening of the tension between the ECB council and staff organisations over reforms to the bank’s pension scheme aimed at avoiding future funding gaps.
It highlights how institutions such as the ECB have been unable to escape the pressures created by longer lifespans and poor financial market returns.
The protest has been called by the International and European Public Services Organisation (Ipso), the ECB staff trade union, which has 460 members among the bank’s 1,500-strong staff.
Under changes to the ECB pension scheme, which the bank announced on Friday after their approval by the council this month, contributions will be increased both for staff and for the ECB.
There will also be changes in the way benefits are calculated, and reduced incentives for staff to leave before the normal retirement age of 65.
Adrian Petty, Ipso’s president, said the changes could reduce benefits by as much as 15 per cent.
Missing from the story: Household budget constraints which are limited by income and crushingly high debt burdens, now that home equity wealth gains have been running in reverse for a considerable length of time and a huge share of US mortgages are under water.
Financial Times
Mounting sadness behind the happy headlines
By Tony Jackson
Published: May 24 2009 16:34 | Last updated: May 24 2009 17:04
One of the driving forces in economics, according to Robert Shiller of Yale, is the story we tell ourselves. We create happy versions of life in the boom times and sad ones in the bust.
It might be said the story is the product of events. But the process is circular. Events drive the story, the story drives our behaviour and our behaviour drives events.
Franklin Roosevelt grasped the point when he told the American people in 1933 that the only thing they had to fear was fear itself. So what is the story today?
On the face of it, a happy one. Equity markets are flying – most of the time, anyway. Investors are hurling billions of new money at the banks, including the most moribund ones.
The world’s fund managers, according to the latest Merrill Lynch survey, are positively bubbling. Their expectations for global growth and corporate earnings are at a five-year high, having been in the pits at Christmas. That mood is shared by the general public, in the US at any rate. Consider the University of Michigan’s survey of consumer sentiment, which asks people how they see things going over the next five years.
The reading hit a low last summer – though not as low as in the two oil shocks of 1973 and 1979, or even the recession of 1990. Since then it has rebounded very nearly to its long-run average.
That is striking on two counts. First, at the risk of seeming cynical, there is no reason to suppose the general public’s instincts are less trustworthy here than those of investment professionals. Second, it is the mood and therefore the behaviour of the general public that matters above all.
As Prof Shiller put it in a lecture at the London School of Economics last week, the central question now is whether we just got our confidence back. If so, logic suggests our problems should disappear.
Prof Shiller is not sure about that, nor am I. It strikes me the feel-good story could be modified by events, in the usual circular way. Equally important, there are other less cheerful stories running alongside it.
On the first point, it is instructive that the US popular mood should have started to revive as long ago as July. For it was not until September that most of the really big stuff happened: the collapse of Lehman Brothers, AIG and Washington Mutual.
On the other hand, it was already clear by July that the US government was going to bail out Fannie Mae and Freddie Mac. So it seems the public had already judged – correctly, on the showing so far – that the government would go to any lengths to shore up the system.
But there are other things which, though foreseeable in principle, could turn out unexpectedly grievous in practice. It seems clear that unemployment will worsen from here, the only question being by how much.
As to house prices, further evidence produced by Prof Shiller – an expert on the subject – reminds us of how far we are in unknown territory. The fall to date is without precedent. But so was the previous rise. In 1990, US house prices were in real terms roughly where they had been a century earlier. Then they almost doubled to the peak.
The picture in the UK is uncannily similar. Prof Shiller shows a chart comparing house prices in London and Los Angeles in the boom and bust. They are almost identical, with the grim proviso that UK prices have yet to fall nearly as far.
Recipe for guaranteed failure: Create a system wherein every participant believes himself too big to fail.
Wall Street Journal
* OPINION
* MAY 23, 2009
Moral Hazard and the Meltdown
Everybody felt too big to fail.
By SCOTT E. HARRINGTON
An appropriate government response to the bursting of the housing bubble requires a full understanding of what went wrong and why. Many commercial banks, investment banks, savings and loans, mortgage originators, subprime borrowers, and insurance giant AIG obviously placed heavy bets on continued housing-price appreciation. They gambled; the losses have been huge and widespread.
Why did so many players place these large, risky bets? A simple yet significant part of the answer is that the potential gains and losses were asymmetric. If housing prices continued to climb, or at least not fall, the participants could achieve large profits. If housing prices failed to appreciate, or even fell, the losses would be largely borne by others, including taxpayers. “Heads” and the bettors would win — “tails” and others would lose.
On the supply side, de facto — and now de jure — government guarantees of Fannie Mae and Freddie Mac debt lowered their financing costs and thus amplified mortgage-credit expansion and housing-price appreciation. Bank deposit insurance and implicit guarantees of bank obligations encouraged risky mortgage lending and investment, especially given strong pressure from Congress for more subprime lending. The shift to corporate ownership of investment banks, with limited liability, encouraged them to take greater risk in relation to capital, especially given expanded competition with investment-bank affiliates of bank holding companies that followed the Gramm-Leach-Bliley Act in 1999.
Moreover, the Security and Exchange Commission’s adoption in 2004 of “consolidated supervision” of the largest investment banks allowed them to increase leverage substantially, in significant part by taking on more subprime-mortgage exposure.
Meanwhile, AIG facilitated investment in mortgage securitization by domestic and foreign banks and investment banks by selling cheap protection against default risk. Subprime mortgage originators were often new entrants that had little reputational capital at risk, and didn’t have to hold the mortgages.
On the demand side, many subprime borrowers acquired properties with little or no money down. They faced relatively little loss if housing prices fell and they defaulted. Many people took cheap mortgages on investment property to speculate on housing-price increases. Others took cheap second mortgages to fund current consumption.
The Federal Reserve played a key role in making these bets attractive to borrowers, lenders and investors. It kept interest rates at historically low levels until it was too late to prevent the eventual implosion. This deliberate policy and public statements by then Fed Chairman Alan Greenspan fueled demand for credit and housing and encouraged lenders to relax mortgage-lending criteria.
…