A Bermuda Triangle Of Financial Hurricanes
The LA Times reports from California. “Southern Californians facing the loss of their homes are finding refuge in rentals. At larger apartment complexes, monthly rents have declined an average of 4.9% in the last year. Joyce Ann Cato is out of work and about to lose her San Bernardino home to foreclosure. As Cato searches for another job, she and her daughter, Minjoy, have landed in a Pomona house that they rent for $1,795 a month, substantially less than the old mortgage payment but still a hefty chunk of the mother’s $2,500 monthly income. ‘Well, it is reasonable because I don’t have to pay the house now,’ Cato said. ‘I am able to pay that.’”
“The decline in prices marks a significant reversal from the boom years, when rents increased as people flooded into the Los Angeles area, attracted by a diverse economy. Now many of the region’s key industries — construction, trade, manufacturing, tourism and entertainment — are reeling. Los Angeles County’s unemployment rate soared to 12.8% last month.”
“Thomas DeLong said he lost five homes to foreclosure, including investment properties, an inheritance and the house he lived in with his girlfriend. DeLong said renting was a relief after years of worry and a financial juggling act that came crashing down all around him. He walked away from the mortgage on his final home in September and began renting a house for about $1,400 a month, with utilities, in the high-desert area of Perris.”
“‘You are trying to pay all these people, and unfortunately, you have to go through a process of elimination, and even though we did that, we still lost everything,’ DeLong said.”
The Associated Press. “John and Donna Pringle were newly widowed when they fell in love and decided to slip into retirement together at a sprawling community being built for the 55-and-up crowd a few miles from their homes in this sun-bleached Southern California town. The Peppertree subdivision promised an expansive swimming pool where visiting grandchildren could splash and swim, a gym stocked with exercise equipment and hundreds of similarly aged neighbors.”
“But when Peppertree’s builder abandoned the project months after the Pringles moved in, the pool disappeared behind a locked iron gate, the exercise machines were repossessed and the 13 existing residents were left alone to grow testy with each other in their cramped corner of the 85-acre development, looking out at empty, overgrown lots stacked with abandoned metal pipes and roof tiles.”
“‘We really feel cheated out of our retirement,’ said Donna Pringle, 72, as she and her 81-year-old husband sat outside on their porch. Theirs is one of only seven occupied homes in the planned 470-unit subdivision. ‘We’ve worked all our lives toward this and it’s not what we were promised.’”
The Union Tribune. “Mortgage defaults in San Diego County fell 7 percent from September to October in a sign that, at least for the moment, housing distress is easing, according to figures released by MDA DataQuick. So far this year, there have been 31,215 default notices, eclipsing the 26,668 for the same period last year.”
“University of San Diego economist Alan Gin read the figures as a sign of an improved housing market in the wake of improved sales and modest price increases in certain neighborhoods. ‘(Banks) don’t want to take back properties, hoping that the housing market will turn around and owners can work things out,’ Gin said. ‘And so even the fact that they are holding back some (from default and foreclosure) is a sign of what state the market is in.’”
“Foreclosure sales in the large ZIP areas of La Mesa-Mt. Helix, western Rancho Bernardo and University City were 100 to 220 percent higher than in September, while Oceanside, College and southern Escondido were off between 23 and 33 percent. ‘That in itself may be a trend,’ Gin said. ‘In the past, foreclosures were concentrated at the very low end and this might be an indication that things have spread out some, that it’s less in low areas and an increase in the high end.’”
“These days, Realtor Matt Battiata, the CEO of The Battiata Real Estate Group…is concentrating on his family — wife Amy and five children — and the tough housing market. ‘Property values are down an average of 40 to 50 percent in San Diego County alone,’ Matt says. ‘A lot of people are upside down — they owe more on their mortgages than their houses are now worth, and foreclosures are rampant. The banks are overwhelmed and because they are so overwhelmed, they aren’t always making the’ smartest decisions in handling mortgage defaults.”
“‘It’s a freak show out there. And I don’t see it starting to get any better until 2013. My work for most of my clients these days is in short sales.’”
The Herald. “One of the main concerns that an agent-broker panel voiced at the recent National Association of Realtors convention in San Diego was a prevailing rudeness in today’s highly competitive market. Speakers traced the cause to a lack of education, communication and etiquette during the boom years, when when not enough time was spent mentoring new members of the nation’s largest trade organization.”
“The association has gone out of its way at its national convention to help prepare its rank-and-file members by offering more than 20 classes in basic computer applications. The Technology Learning Center at the annual convention drew more than 4,200 attendees to the classes last year and 5,700 in 2007.”
“The Technology Learning Center was canceled at this year’s convention. That’s because Stewart Title had sponsored the popular program in the past. A new California bill places significant restrictions on the types of training a title company can provide to the real estate industry. The California law seeks zero tolerance in any incentives to real estate sales agents.”
“I thought about how California got to that $10 number when a San Diego-based writer reminded me that a few years ago California-based Southland Title Corp. and its subsidiaries, Southland Title of Orange County and Southland Title of San Diego, were alleged to have spent at least $174,000 on food, beverages and entertainment plus $62,000 on gifts and gifts certificates and $218,000 more on business support services. The amazing piece was that the same company was fined $1.5 million two years before for similar practices. That’s a lot of free lunches — and it gives you an idea of what Southland felt it had to do to stay in the game.”
The Bakersfield Californian. “The California Department of Real Estate has barred former real estate agent David Crisp from working in any real estate-related field for three years. The state revoked the licenses of Crisp and Cole last year after finding them guilty of fraud and dishonest dealings, among other charges, in an administrative hearing. More than 140 properties connected to Crisp, Cole and their relatives and business associates are troubled, with most going into foreclosure.”
“Meanwhile, the company’s officers and their associates face several civil lawsuits from lenders. Crisp’s actions ‘epitomized the rampant greed that contributed to the market collapse,’ Real Estate Commissioner Jeff Davi said in a statement released Monday. ‘He should not be allowed to work in any capacity related to finance or real estate.’”
“As of Monday, there was no ban on Cole. ‘That isn’t to say there won’t be one in the future, but at the moment there is not,’ said Department of Real Estate spokesman Tom Pool. Cole hung up when contacted by a reporter Monday.”
The County Sun. “ICB Financial’s president and CEO says the company is open to buying a troubled bank’s assets, as long as its the right fit. The parent company of Ontario-based Inland Community Bank reported $97,000 in third-quarter losses compared with $221,000 in losses in third quarter 2008. Losses stem from two residential construction loans that the business bank is trying to sell,said Jim Cooper. Another two have already been wiped off the books.”
“‘We’re posting record gross revenues, but the majority of it is continuing to go to provisioning for credit losses,’ Cooper said.”
“More than $1.5 million in prepaid assessments to the Federal Deposit Insurance Corp. is also affecting the bank’s financial picture. ‘Those of us that are still standing are paying for those that’ve failed,’ Cooper said. ‘I think (FDIC Chairwoman) Sheila Bair will end up having to do this again by third quarter next year. They’re projecting they’ve got up to 500 more (bank failures).’”
The San Francisco Chronicle. “United Commercial Bank of San Francisco liked to boast that it was the first U.S. bank to buy a bank in China. Instead it will go down in history as the first U.S. depository institution to fail after its parent company took money from the Treasury’s Troubled Asset Relief Program. When regulators shut down United Commercial Bank on Nov. 6 , ‘it was like deja vu,’ says Richard Newsom, a retired West Coast bank and thrift regulator.”
“United Commercial Bank grew from the ashes of United Bank, a San Francisco thrift that failed in the mid-1980s as a result of ‘reckless construction lending,’ Newsom says. Likewise, the FDIC cited commercial real estate and construction loans as a cause of United Commercial Bank’s failure, along with ‘alleged fraud.’”
“That may have surprised people who still saw it as a conservative bank catering to Chinese Americans in San Francisco, Los Angeles and a few other cities with large Asian communities.”
“Julianna Balicka, an analyst who followed UCBH until last week, says ‘the real problem started’ when the company wanted to buy a bank in China but needed $10 billion in assets to do so. ‘Management got greedy about growth,’ she says. Between the third and fourth quarters of 2006, its assets surged from $8.3 billion to $10.3 billion.”
“‘It was one of the worst times to push growth given what happened in the housing and credit cycles,’ Balicka says.”
The Contra Costa Times. “Say goodbye, finally, to hopes of extending that $10,000 tax credit for buyers of new, unoccupied homes in California. It’s all but dead for this year, says one lobbyist who patrols the state Legislature on behalf of homebuilders. ‘We were disappointed neither of those bills panned out this year,’ said Allison Barnett of the California Building Industry Association. ‘We’re looking for options next year.’”
“If you’re among those who think we’ve seen enough new beige-colored houses for a while, here’s welcome news. It will take until 2016 for area builders to get back to production levels of 1999. That’s a prediction from Folsom building industry consultant Greg Paquin. He sees a 2016 with 10,921 sales in El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties. That would compare with 10,656 in 1999.”
“This year’s expected sales totals in the region: 3,048. Paquin still calls current events in the capital region ‘an economic recession and a housing depression.’”
The Sacramento Bee. “There’s life again at the upper end of the local housing market. We’re hearing of a number of recent sales of homes priced above $1 million, mostly in Sacramento’s older, established neighborhoods. Lyon Real Estate agent Debbie Davis reports two recent sales on swanky Crocker Road in Sierra Oaks Vista – one going for $1.65 million, the other for $1.3 million.”
“A nearby property on Hawthorne Road closed three weeks ago at a price of $1.27 million, she says. The reasons for the pickup in a market segment that’s been hardest hit by the housing downturn? Killer deals, Davis says.”
“‘People tell me the prices are so low (relative to a few years ago) and they want to get into these neighborhoods at a discount,’ she says.”
The Mercury News. “With many Americans still spooked by the stubbornness of the Great Recession, hesitant to splurge while the economy remains so iffy, Black Friday this year seemed to fall into a gray area. Some Bay Area stores drew killer crowds, but others were dead. And despite the hype of deep discounts and early-bird openings, one mantra echoed from Silicon Valley to San Francisco: Consume with caution.”
“Many shoppers seemed conflicted — they lusted after the great markdowns, yet they thought hard before going for their wallets. Instead of the unbridled spending of past years, many people window-shopped and moved on, as if they’d come to the malls just to pretend happy days were here again. ”
“‘Last year was better because the recession was just getting started and people didn’t realize how bad it was going to be,’ said Rashid Mohammed, standing alone at his iPod Place kiosk Friday morning in the Great Mall in Milpitas. ‘Now they do, and they’re not spending like they used to.’”
The Lompoc Record. “There will be fewer places to shop in Lompoc this holiday season, as at least six local businesses have closed in recent weeks. The businesses represent a diverse cross-section of the local economy: Awards and Things, Creative Kids tutoring academy, Honda Motorcycles, Johnny’s Bar and Grill, McConnell’s Ice Cream, and Sports Nutz.”
“Phil Skillin, the owner of Video Library will raise the closure count to seven this week, when he closes his store after the Thanksgiving holiday. ‘You’re the fourth person I’ve had in the store. The first two were looking for jobs,’ Skillin said.”
The Desert Sun. “Paul R. Ryan is a seasoned business operator who can see only faint light at the end of the tunnel from what he thinks is not just a recession but a deep economic depression. But at the same time, the CEO of Fantasy Springs Resort & Casino thinks the things that made the Coachella Valley such an attractive place for economic development at the start of the 21st Century will return, and he spends much of his time preparing for the turnaround.”
“‘All the things that made the Coachella Valley such a dynamic growth area three, four years ago are still there,’ he said. ‘We still have great sunshine, affordable land and provide an opportunity for people from northern states to get into an ideal area. I think all those great things remain true and by 2012, we’ll start coming back to normal.’”
“Looking at the economy, he said he didn’t ‘believe we are in a recession. I think we are in a deep depression.’ He said he did not think the flow of information from the government educated Americans on how bad things are.”
“Ryan said that when he ‘was a kid, my father used to tell me that the entire economy was built on the housing industry. He’d say that when you build a house, you are employing the guy who makes shingles, one who does plumbing, another who does landscaping and that’s the lifeblood of the economy.’”
“He said he felt the Coachella Valley was a great example of this concept. ‘When the housing industry was healthy, we were the second fastest growing county in the entire United States,’ he said. ‘But until people get back to work, this will be a very depressed area and will remain depressed until they go back to work.’”
The Daily Democrat. “When Rochdale Grange was proposed as 44 apartments of affordable housing for Spring Lake in Woodland in 2004, everything was a go, according to David Thompson. ‘Three years later, you could hardly find the project’s heart beat,’ Thompson reported recently. ‘The owners of the subdivision were in receivership, the bank which now owned the subdivision had been seized by the FDIC, and the financing had fallen apart (the tax credit program no longer worked and the state agencies had lost their bonding and funding capacity). The project had entered a Bermuda Triangle of financial hurricanes.’”
“However, Luke Watkins of Neighborhood Partners ‘found a way to pilot the ship first to safety and then to success,’ stated Thompson, and at noon, Tuesday, there will be a groundbreaking. ‘Working with all of the players (The city, the state, the receiver and the bank) Luke Watkins re-structured the financing of the entire project,’ Thompson reported. ‘His efforts finally secured special funds from the federal government’s American Reinvestment and Recovery Act assigned through the Tax Credit Allocation Committee of the state of California.’”
The Manteca Bulletin. “It is true that unemployment in California has topped 12 percent and that foreclosures are still piling up while government at all levels is going on crash financial diets that are hopefully shedding fat without cutting into the muscle. But between the stories of the demand for free meals and the requests at food closets being up significantly as well as the story of one Brentwood family that has been able to keep their home and enjoy Thanksgiving at home through a loan adjustment were three reports of how people were coping with Christmas in these challenging economic times.”
“One San Jose woman was talking about how rough the downturn has been on her family before rattling off a list of stuff she intended to buy after waiting in a Best Buy parking lot overnight. The list included a couple of big screen TVs, an MP3 player and two laptops.”
“Another woman told a TV reporter that things were tight and they were cutting back on spending as she struggled to hold about two dozen articles of clothing while waiting in a checkout line at an Old Navy store. Still another talked with consumers at the San Francisco Auto Show including one bemoaning the weak economy before saying he would probably be buying a new Mercedes in 2010.”
“Tom Joad meet the 2009 version of the ‘Grapes of Wrath.’”
“Yes, there are some barely getting by…The vast majority of us aren’t drowning in the downturn although it is safe to say that can change with the loss of the job since more than a few of us are the proverbial check or two away from the edge. Yet when stores are packed and non-necessities – sorry but big screen TVs, iPods, cell phones that can run nuclear power plants and download MTV, and video games aren’t essential to survival – are flying off the shelves this isn’t a repeat of The Great Depression.”
“It is unfortunate what has happened with housing where many buyers either let greed, bit off more than they should of, hoped against hope that the bubble would keep going , didn’t fully understand what they were doing, or in the case of those hit by unemployment are losing their homes.”
“It is not the end of the world and they aren’t the first Americans forced to start over because of an economic meltdown.”
“Edna Towle – my maternal grandmother – was forced to sell her 1,000-acre ranch at the height of the Great Depression in 1936 in order to meet bank loans. She had been abandoned by her husband to run the ranch in the foothills of Nevada County with seven kids to raise in 1929. With three kids still at home at age 55, she moved to town and started cleaning houses, working the night shift at the cannery, and took on odd jobs. She bought a small lot and built her own home by her own hand going along as she could.”
“The house is more than modest by today’s standard. It has three bedrooms, one bathroom, and less than 800 square feet. She never complained, never looked back, and never cursed her lot in life. She had kids yet to raise and had to support herself. She did what she had to do.”
“When she died at age 85, all of the possessions she had were essentially in her modest home as she didn’t even have a car. But she raised seven kids essentially on her own, refused to wallow in self-pity, demanded of herself and others that they do the best they could, and paid all of her debts. And she also made sure to help those who were less fortunate however she could.”
“She also refused to judge herself against others who had more material things. It is something that those who have to start over today should keep in mind especially if they are not among those who are walking away from their home simply because it is worth less today than it was when they bought it. There is great dignity in doing the right thing. There is no shame in failing if you tried to do the right thing but couldn’t overcome circumstances. You can fail and you can get back up again.”
“Success in life isn’t about big screen TVs, big houses, touring Europe, or the latest gadgets. It is about how you deal with trials and tribulations.”
“Success in life isn’t about big screen TVs, big houses, touring Europe, or the latest gadgets.”
Would someone please pass the word on to my MD BIL? (Omitted from the list: Disney vacations)
I reckon it is about not “HAVING” to get up and go to work!
I don’t know. A lot of trust fund babies meet that description. Does your definition of “success” include the good luck to be born into wealth, or do you have to work to earn it?
Some memorable words from this blog a few months back: “I was lucky in that I grew up during the Great Depression.”
More a matter of the big screen tv(s), new cars, vacations all on credit forces the issue.
By the evidence with which I am personally familiar, MDs get higher credit limits than the rest of us.
“‘We really feel cheated out of our retirement,’ said Donna Pringle, 72, as she and her 81-year-old husband sat outside on their porch. Theirs is one of only seven occupied homes in the planned 470-unit subdivision. ‘We’ve worked all our lives toward this and it’s not what we were promised.’”
Who ‘promised’ them something, the developer with a shiny brochure and slick sales pitch.
I remember these sales pitches from Realtors I knew back in 2004 - 2005. Buy a house for the same or less than you are paying in rent - refinance in a couple of years and go on a nice vacation or get a new car!
I know what a bunch of malarkey that was and steered clear, but many obviously through greed or ignorance or both bought in to the big lie. A lie I might say still goes on today.
And don’t forget “buy now or you’ll never get in”
They worked all their lives to live in a 55 and over community with a pool and an exercise room ? Sounds pretty dull. Wise Up. Walk away, rent a nice place with a pool close to a health club with a senior discount. Use the saved money on travel and dining out. Did you really want to spend your golden years hanging out watching your neighbors drop dead ?
That’s the thing. I would not want to move to a 55+ community and see hearses pass my place on a regular basis! Being around young people helps keep you young! Another reason to never retire, just have shorter workdays.
“I would not want to move to a 55+ community and see hearses pass my place on a regular basis! ”
I must be getting intolerant, because I’d rather see hearses pass by my house than school buses.
“The Peppertree subdivision promised an expansive swimming pool where visiting grandchildren could splash and swim…”
Oh, no! The trouble with these 55+ communities is that it’s the worst of both worlds…crabby old people AND their monstrous grandbrats.
good golly, miss molly
I sure like your attitude
Come live next door to me, Molly.
Me too, Molly.
“The Peppertree subdivision promised an expansive swimming pool where visiting grandchildren could splash and swim…”
That defeats the major plus of 55+, no screaming kids.
Some of the very first 55+ planned communities are here in Rancho Bernardo. For the last 30 years, they represented a pleasant if modest retirement home in nice weather. However, over the last 5 years, these homes went for $450K+ for a little dump and much more for a decent place. How many retired folks can afford that?
Not many retired people can afford 450K. I have to say though, that Rancho Bernardo is like driving through a cemetary. If ya want quiet they have the corner on it. It’s dead all right and kind of creepy to me. My daughter was married there at the winery back in 2001 and my son’s fiance’s parents live there still. It’s just not my cup of tea is all. I prefer a little more life around me but I get that some don’t. Of course I’m not sure who’s buying there these days. Even the tiny 55+ places in O’side off Temple Heights are tough sell these days and they’re priced around 175K
wow! this is really the heart of the matter - how we live our lives and deal with our challenges. I dont like that fact that some will (really) suffer in the next few years, but i think that people learning to work through and not whine, will materially improve society for a generation.
———————————-
“When she died at age 85, all of the possessions she had were essentially in her modest home as she didn’t even have a car. But she raised seven kids essentially on her own, refused to wallow in self-pity, demanded of herself and others that they do the best they could, and paid all of her debts. And she also made sure to help those who were less fortunate however she could.”
“She also refused to judge herself against others who had more material things. It is something that those who have to start over today should keep in mind especially if they are not among those who are walking away from their home simply because it is worth less today than it was when they bought it. There is great dignity in doing the right thing. There is no shame in failing if you tried to do the right thing but couldn’t overcome circumstances. You can fail and you can get back up again.”
“Success in life isn’t about big screen TVs, big houses, touring Europe, or the latest gadgets. It is about how you deal with trials and tribulations.”
Of course the problem with this is, thanks to the government, some people, even those most deserving never got their trials and tribulations. Instead, they stole all they could when times were good. They (Wall Street) stole even more when times were bad and were given cover by government.
Stealing is perfectly legal, provided (1) you are a bank; (2) there is a financial crisis; (3) you are a passive accomplice, as a bailout recipient.
Ya forgot one there, PB.
(4) You are, or work for, the government.
Has anyone here ever read a book called “your money or your life”?
It’s a tad new-agey, but had a thought provoking mental exercise. It asks you to calculate the “cost of your job” (in terms of commuting costs, business clothes, self-medicating with Ben & Jerry’s, etc.) so that you can calculate your “true wage”.
The idea being to understand how much/little you have left over and how how much of your life each dollar earns represents.
Gave me a new “mental arithmetic” about unnecessary/discretionary spending priorities.
The California Department of Real Estate
I’m betting they all kept their jobs
I doubt it, taxme. During the height of the boom tens of thousands applied for licenses. Now many are not renewing them. I would guess that, given the CA state hiring freeze, the DRE has shrunken considerably. And it will continue. Good.
“…in the high-desert area of Perris.”
There then is really deLong & deShort of his real pain.
Trust me, it ain’t an upgrade.
Perris wishes they were in the high desert…. but no they are in that dusty dirty place between the 15 & 215 in west central Riveside. There are worse places, Romoland and Homeland come immediately to mind.
OK my husband chimed in on Perris (he used to work out there) he calls it the nutsack of central Riverside and Homeland & Romoland are the bunhole. I tell ya only people living on government assistance live out that way. I had serious trauma drivng through there one Saturday afternoon.
“…Cole hung up when contacted by a reporter Monday.”
Geez, maybe the reporter just wanted to know about a listing.
Thanks for remembering Bakersfried, CA Ben!
I hope that Crisp&Cole is gloating somewhere. Remember him/her?
“The association has gone out of its way at its national convention to help prepare its rank-and-file members by offering more than 20 classes in basic computer applications. The Technology Learning Center at the annual convention drew more than 4,200 attendees to the classes last year and 5,700 in 2007.”
“direct deposit” skills do seem rather archaic these days don’t ya think?
“Ryan said that when he ‘was a kid, my father used to tell me that the entire economy was built on the housing industry. He’d say that when you build a house, you are employing the guy who makes shingles, one who does plumbing, another who does landscaping and that’s the lifeblood of the economy.’”
To the extent that it is or was is the problem. A strong housing market should be a symptom of a legitimately strong economy, not a centerpiece of any economy.
“‘You are trying to pay all these people, and unfortunately, you have to go through a process of elimination, and even though we did that, we still lost everything,
You got to live in a fancy home for a few years, drive a HELOC’d car and eat out on credit 5 nights a week, then can walk away and not owe a penny! What, exactly, have you lost?
“You got to live in a fancy home for a few years, drive a HELOC’d car and eat out on credit 5 nights a week, then can walk away and not owe a penny! What, exactly, have you lost?”
Exactly, more like what have you gained for nothing?
I still see a lot of RVs, boats, and Hummers sitting in the driveways of homes with for sale signs dangling on broken hinges out in my neck of the woods.
And NOT a single one of them stashed a few gold coins away. Let alone 2-3 high end laptops so they can walk away with them and get better jobs.
———–
What, exactly, have you lost?
Ideally, you’d lose your right to vote. Say, for 3 election cycles.
“The decline in prices marks a significant reversal from the boom years, when rents increased as people flooded into the Los Angeles area, attracted by a diverse economy.”
The regulars predicted this eventual drop in rents before the onset of the housing crash, and a plethora of trolls responded by telling us we were wrong. With the aid of hindsight, it appears that we were spot on.
By the way, lower rents imply lower equilibrium prices in the primary and secondary markets for owner-occupied housing, other things being equal, as rental housing is a substitute for owner-occupied housing.
The regulars predicted this eventual drop in rents before the onset of the housing crash, and a plethora of trolls responded by telling us we were wrong. With the aid of hindsight, it appears that we were spot on.
Except the regulars were predicting drops based on both demand and supply. The explanation for the rent drops in that article appears incomplete at best.
To me, any rent drops still appear to be greatly lagging the fundamentals.
Don’t expect writers of MSM articles to show a rudimentary grasp of economics, and you will not have to be disappointed.
Lower rents are also a sign of excess housing, as plenty who are buying now are expecting to become short-term landlords while the market ‘comes back’.
This is why now there is such an excess of rental units, with all those ’smart’ landlords that will sell under two conditions.
1. The market returns
2. Foreclosure
lower rents i
Due to the continual learning curve and encouragement of HBB folks,we got our rental agency to get owner to reduce to the tune of -$200.
We had another one in the bag, so even though we were aiming for -300, it basically was a wash considering moving expenses,van,movers, etc. I Thank you!
“One San Jose woman was talking about how rough the downturn has been on her family before rattling off a list of stuff she intended to buy after waiting in a Best Buy parking lot overnight. The list included a couple of big screen TVs, an MP3 player and two laptops.”
Such devastating financial hardship!
They need to buy stuff just to get their minds off it.
“‘Last year was better because the recession was just getting started and people didn’t realize how bad it was going to be,’ said Rashid Mohammed, standing alone at his iPod Place kiosk Friday morning in the Great Mall in Milpitas. ‘Now they do, and they’re not spending like they used to.’”
Possible conclusion: The consumer economy depends on having a critical mass of greater fools who do not understand what is going on willing to spend themselves into oblivion. It sounds like we may currently face a shortage of fools with buckets of money and boxes of stupid?
“It sounds like we may currently face a shortage of fools with buckets of money and boxes of stupid.”
The money buckets are empty, the boxes of stupid remain full.
“Foreclosure sales in the large ZIP areas of La Mesa-Mt. Helix, western Rancho Bernardo and University City were 100 to 220 percent higher than in September, while Oceanside, College and southern Escondido were off between 23 and 33 percent. ‘That in itself may be a trend,’ Gin said. ‘In the past, foreclosures were concentrated at the very low end and this might be an indication that things have spread out some, that it’s less in low areas and an increase in the high end.’”
How many ‘Gee whiz’ moments is one economist entitled to enjoy over the course of his career?
Perhaps there should be a separate Nobel prize awarded in real estate economics? Nominees, anyone?
Perhaps there should be a separate Nobel prize awarded in real estate economics? Nominees, anyone?
Hands down ……OBAMA!!!
“‘People tell me the prices are so low (relative to a few years ago) and they want to get into these neighborhoods at a discount,’ she says.”
I repeat myself, but the ‘weekend tomato sale’ principle does not carry over to housing.
Ben used to like to joke about handwringers on the HBB who might run out of lotion if they were not careful. I am wondering if the MSM financial writers might need to restock their hand lotion supplies before long? Perhaps we could take up a collection…
Worries about Dubai wipe out early gains
Sunday, November 29, 2009
U.S. stocks were flat last week as speculation that Dubai will default on its debt unnerved investors, overshadowing an improvement in American jobless claims and home sales and negating gains early in the week.
Morgan Stanley lost 5 percent, Bank of America fell 3.9 percent and Goldman Sachs Group dropped 3.4 percent. Financial institutions had the biggest drop among 10 industries in the Standard & Poor’s 500-stock index as Dubai World, the state-controlled company with $59 billion of liabilities, said it is seeking to delay debt payments.
Among S&P 500 companies, 273 declined and 224 rose for the week. The S&P 500-stock index added less than 0.1 percent, finishing the week at 1091.49 after climbing to a 13-month high on Nov. 25. The Dow Jones industrial average fell 8.24 points, or 0.1 percent, to 10,309.92. The Nasdaq composite index declined 0.4 percent, to 2138.44.
“Investors are selling into a vacuum,” said Jeffrey D. Saut, chief investment strategist at Raymond James & Associates in St. Petersburg, Fla. “The collateral damage that will take place from the Dubai fallout is unknown. You’re not going to know until the pros get back next week.”
…
Bye, bye, misinvested Dubai.
Dang, that was good, Martin Gale. Never let anyone rein you in.
It sounds like the Dubai handwringers may be unnecessarily wasting their lotion, as it is TBTF and has wealthy neighbors which feel obligated to provide a bailout.
* The Wall Street Journal
* OPINION
* NOVEMBER 29, 2009, 5:08 P.M. ET
Much Ado About Dubai
The panic over its debt problem tells us more about investors than it does about the emirate.
By ZACHARY KARABELL
Global markets sank sharply at the end of last week on fears that Dubai World, a subsidiary of the government of Dubai, was on the verge of defaulting on approximately $60 billion of the emirate’s $80 billion in total debt held by creditors world-wide. The rush of news stories added to the wildfire of panicky speculation, with headlines ranging from “Dubai Default Risk May be Big US Bank Problem,” to “Dubai Shows Limits of Government Rescues.”
The mini-panic, however, has little to do with Dubai and everything to do with the tenuous psychology of global investors still skittish after the financial crisis that hit in the fall of 2008.
The challenges that Dubai faces are both well-known and at least a year old. In the wake of the global financial crisis, Dubai’s debt was seen as one of many international soft spots, especially since most of the debt was tied to the assumptions that oil would stay above $145 a barrel, and that Dubai would continue to make the fantastic real-estate gains that had characterized the previous years.
The much-lauded and debated Dubai development model depended in part on a well of capital secured by oil and buoyed by the confidence of the emerging world. That confidence led to the creation of man-made islands, ski slopes in the desert, and some of the world’s tallest buildings. It also led to aggressive foreign investments in a portfolio that included luxury stores such as Barney’s and frivolities such as Madame Tussaud’s wax museums.
What led to Dubai’s rise was a vision of Arab entrepreneurialism, easy credit, and anything-is-possible attitude that epitomized the “if you build it they will come” philosophy. It was and is a dynamic materialistic outpost in a corner of the world more identified with religious and ethnic strife, and for a time it seemed to break free of the mooring of history. If nothing else, Dubai is the shopping mall and nightclub for much of the region.
Its obituary was written in the aftermath of the financial crisis as yet another icon of hubris. But Dubai is part of a United Arab Emirates confederation that includes Abu Dhabi and Sharjah, which have oil wealth that Dubai lacks.
As Dubai’s ruling family preened, the neighboring emirs sulked, and when Dubai’s debts came due prematurely, they swooped in, replete with the scolding I-told-you-so’s and armed with billions in oil dollars. Unique model aside, Dubai was always a story of wealth expatriated from Abu Dhabi, Saudi Arabia, Kuwait, and, more opaquely, Iran. If there was ever an example of too big to fail, Dubai was it.
Dubai will not default on its debts—its neighbors simply will not allow it and as of yesterday they have pledged not to. They can well afford to bail out their cousin, though not without extracting a price for the infusion of funds. At one point early this year, with oil heading to $30 a barrel, it was possible the money wouldn’t be there. But with oil near $80, the sovereign wealth funds of Abu Dhabi that have been conspicuously silent of late have their hundreds of billions.
Dubai is central to the fate of those who will bail it out. Rich-as-Croesus neighbors, whose conservative culture precludes the carefree amoral opportunities offered by Dubai, use the country as an escape valve. More important, Dubai remains a vital hub of banking, financial markets, deal-making and real estate development that is not about to pass quietly into that good night.
…
Dubai was supposed to be the middle-east Las Vegas.
Be careful what you wish for.
Looks like they succeeded beyond anyone’s wildest dreams…
Dubai is about as vital as Las Vegas, and propping up Dubai real estate is a complete waste of time and money and makes about as much sense as propping up real estate in Manteca or Ft. Myers.
My prediction remains that, by 2025, there will be no Dubai, and all the towers, man-made islands, etc., will be decrepit monuments to the unbelievable misallocation of resources that occurred during our time.
My name is Ozymandias, king of kings.
Look on my works, ye mighty, and despair!
Bye, bye, mis-invested Dubai.
Hate when that happens….
They might be able to bail it out ,but the question is …can they keep it going ?
“The foolish man builds his house upon the sand…”
Dubai house prices seen extending falls on debt crisis
Sun Nov 29, 2009 7:08am EST
By Jason Benham
DUBAI (Reuters) - Dubai’s property market is likely to face further price falls and increased concerns over the availability of finance after the emirate said it would delay debt payment issued by two of its flagship firms, analysts said.
Dubai rocked the financial world on Nov 25 when it said it would ask creditors of Dubai World, the conglomerate behind its rapid expansion, and Nakheel, builder of its palm-shaped islands, to agree to a standstill on billions of dollars of debt as a first-step to restructuring.
“The news plays on investor psyche and house prices may slide a further 20-30 percent earlier than our existing view of second half of 2011,” said Saud Masud, UBS’ head of research and senior real estate analyst, Middle East and North Africa.
“There may likely be further job cuts as a result of any potential restructuring, and that could directly impact population outflows and result in housing oversupply.”
State-run Dubai World had $59 billion of liabilities as of August, a large proportion of Dubai’s total debt of $80 billion and repayment of Nakheel’s $3.5 billion worth of Islamic bonds, which were originally due to mature on December 14, was widely expected by the market to be met.
“I think residentially there will be an impact. There will be uncertainty over liabilities for that group going forward and that will impact pricing,” said Nicolas Maclean, managing director at real estate services firm CB Richard Ellis
“But if you hold property in an unrelated developer, there may be only be a knock-on effect short-term,” he added.
…
Yeah yeah. I might go to the $45K/night hotel when it’s down to $150 per night. Does that sound like a 20% decline?
Feel free to whistle loudly as you walk past the graveyard if it makes you feel better.
Thomson Reuters
UPDATE 1-S.Korea calls meeting to check fallout from Dubai
11.29.09, 08:14 AM EST
SEOUL, Nov 29 (Reuters) - Financial officials from South Korea’s government and central bank will meet early on Monday to check the domestic impact from Dubai’s debt crisis, the Ministry of Strategy and Finance said on Sunday.
Vice Finance Minister Hur Kyung-wook will host the meeting from 8 a.m. (2300 GMT on Sunday), with officials from the Bank of Korea and economy-related ministries also attending, it said in a short mobile phone message sent to reporters.
The meeting, at which participants will discuss the impact on the domestic financial sector from ‘the Dubai incident’, will not be open to reporters but the ministry plans to issue a statement at the end, it said.
The Financial Services Commission, the country’s top financial regulatory agency, held its own meeting of officials on Sunday and said in a statement later there was little chance of a full-scale global problem stemming from Dubai’s debt crisis.
‘There’s little chance that this problem would grow into a systematic risk on a global scale like the Lehman Brothers case did, according to the consensus,’ the FSC said.
…
* The Wall Street Journal
* BUSINESS
* NOVEMBER 29, 2009, 10:06 A.M. ET
Dubai Stocks Poised for Bruising Monday
By NIKHIL LOHADE
DUBAI– Dubai stocks are seen racking up significant losses Monday, putting a 28% rally so far this year at risk, amid concerns about the city-state’s deteriorating debt profile.
Late last week Dubai said it plans to restructure Dubai World, one of its flagship companies that is struggling with liabilities of about $60 billion, and will seek a debt standstill, sparking fears of a default. The news sent global stock prices lower as investor appetite for riskier assets rapidly diminished.
“Given that there has been no significant statement yet from any government official to explain the situation, the U.A.E. stock markets are likely to trade limit down Monday as investors react, just like all other world markets, to Dubai’s debt problems,” said Haissam Arabi, chief executive of Gulfmena Alternative Investments.
Dubai’s benchmark DFM Index finished trading Wednesday 1.1% higher at 2093.16. The gauge is up about 28% this year and is the Gulf region’s second-best performer behind Saudi Arabia.
European shares fell sharply Thursday in response to Dubai’s debt problems, and Wall Street followed suit Friday, after being closed the previous day for Thanksgiving holiday.
The timing of the Dubai statement, just prior to a long religious holiday in the Persian Gulf region, impressed few international investors and the lack of any (Dubai government) clarification is likely to turn many into sellers when markets open, analysts noted.
…
Are you F’in kidding me? That’s still 72% of her income! Minimum joy (Minjoy), indeed.
“As Cato searches for another job, she and her daughter, Minjoy, have landed in a Pomona house that they rent for $1,795 a month, substantially less than the old mortgage payment but still a hefty chunk of the mother’s $2,500 monthly income.”
$1,795.00 a month for a house in POMONA? Why? Because you want to watch the gang violence up close and in person?
Couldn’t this lady rent a apartment for about a thousand a month .Maybe shes on the dole somehow ,because $700 left over monthly isn’t much to
live on after housing .
Well, notice that the $2,500 “income” seems to have survived her loss of a job. She may expect to find another job in the near future. (She may be wrong about that, too.) Calif unemployment benefit isn’t enough to explain the “income,” I think.
‘We really feel cheated out of our retirement,’ said Donna Pringle, 72, as she and her 81-year-old husband sat outside on their porch. Theirs is one of only seven occupied homes in the planned 470-unit subdivision.
–Are you kidding me? I would give my left arm to live there. Here in the Phoenix suburbs all I hear all day is jerks riding their Harleys down Cactus Avenue and the any one of the 20 or 30 nearby neighbor’s dogs constantly barking. Give me some peace and quiet in my retirement, and I’m in heaven!!!!
The younger part of those retirees are in their early 60s. I would imagine there are a lot of “easy rider” wannabes.
Me too. I have friends with Harleys but I hate the loud noise.
The 1997 Asian currency crisis began with a devaluation event — of the Thai baht. Luckily, this time is different, at least according to the Thai Finance Minister.
* The Wall Street Journal
* NOVEMBER 27, 2009
Vietnam’s Devaluation Alarms Rival Exporters
While Few Asian Neighbors Are Likely to Follow Hanoi’s Lead on Currency, Competitors Such as Thailand Brace for Fallout
By JAMES HOOKWAY in Hanoi and ALEX FRANGOS in Hong Kong
Vietnam’s decision to devalue its currency raises tensions across Asia as the region’s export-driven economies jostle for an edge amid a slow recovery in orders from the U.S. and Europe.
Vietnam shaved 5% off the value of its currency, the dong, on Wednesday, its third devaluation since June 2008. It also increased interest rates by one percentage point, to 8%. The moves were driven primarily by domestic concerns, including a need to combat speculative pressure that has weighed on Vietnam’s economy for more than a year.
The devaluation makes Vietnam’s manufactured goods cheaper than those of many other Asian countries, improving its relative position in global trade. That puts Vietnam in the same camp as China, another country that has kept its currency weak compared with its neighbors, sparking complaints from manufacturers and leaders in the region who want China to let its currency, the yuan, rise.
Thai Finance Minister Korn Chatikavanij, whose country has spent at least $15 billion this year to slow the appreciation of its currency and keep it competitive with the yuan, said in a phone interview Wednesday that Thailand could see some “marginal impact” in low-margin export industries such as textiles after Vietnam’s devaluation, but that he was hopeful the broader Thai economy wouldn’t be buffeted too much.
…
Shaved 5% off the dong, eh? That’ll hurt the little guy the most.
OMG, laughed so hard tears ran down my leg..
Are those tears?
So funny. Plus google number.
There appears to be an emerging devaluation flu pandemic that might eventually make the H1N1 pandemic look like an outbreak of the common cold by comparison.
SNB chief denies Swiss seek competitive devaluation
Sat Nov 28, 2009 7:52am EST
* SNB using exchange rate to stabilise economy
* Franc appreciating as Swiss emerge from recession
* Recovery driven by domestic demand rather than exports
GENEVA, Nov 28 (Reuters) - Switzerland is using exchange rate policy to stabilise the economy and is not devaluing the franc to gain an export advantage, Swiss National Bank Chairman Jean-Pierre Roth was quoted on Saturday as saying.
The Swiss franc hit a 19-month high against the dollar on Thursday and some traders said the central bank had intervened to stem its rise.
Roth noted in an interview with Swiss daily Neue Zuercher Zeitung that in March the franc had been appreciating while interest rates were at zero in a recession.
“We could only halt this vicious circle via the exchange rate,” Roth said.
“We are sticking to this line. It is not competitive devaluation. We will continue to have lower inflation than neighbouring countries for some time which will tend to push up the franc,” he said.
…
Japan’s Hirano Says Rapid Currency Move Not Desirable (Update1)
By Stuart Biggs
Nov. 27 (Bloomberg) — Japanese Chief Cabinet Secretary Hirofumi Hirano said rapid exchange rate moves aren’t desirable after the yen rose to a 14-year high against the U.S. dollar, falling short of calling for intervention to halt the gains.
“Abrupt movements would be undesirable,” Hirano told reporters in Tokyo at a regular press briefing. We are carefully monitoring” the market, he said.
Japan’s biggest business lobby today called on Japan’s Prime Minister Yukio Hatoyama’s 10-week-old government to take measures to halt the yen’s rise, which is hurting the country’s exports. The option favored by previous governments, purchasing dollars, is less available to Hatoyama because of commitments to rein in debt and cut wasteful government spending.
“The government is in a pretty big mess right now,” Martin Schulz, Tokyo-based chief economist at Fujitsu Research Institute, said in a phone interview. “They’re fully engaged in very small and day-to-day budgetary work, which is almost overwhelming the government.”
…
“They’re fully engaged in very small and day-to-day budgetary work, which is almost overwhelming the government.”
WTF? (And they were going to ‘take over the world’ 25 years ago. Makes you wonder about China. Or is it different this time?)
“And they were going to ‘take over the world’ 25 years ago. Makes you wonder about China.”
I begin to wonder if US Treasury and Fed officials are not truly the global masters of financial jujitsu? At any rate, they sure do demonstrate a fondness for using leverage…
* The Wall Street Journal
* NOVEMBER 11, 2009, 12:21 P.M. ET
Venezuela Official:Devaluation Carries Political, Social Risks
CARACAS (Dow Jones)–Finance Minister Ali Rodriguez said Wednesday that any devaluation of the bolivar would have to be timed taking into consideration its political and social impact.
“It’s a problem that requires making the necessary adjustments in the precise moment,” Rodriguez said during a conference.
Rodriguez added that any adjustments would need to take into consideration economic and financial variables as well as their political and social impact.
“An overvalued bolivar is a mechanism for economic redistribution,” he said.
…
Rodriguez Says Venezuela Studying Bolivar Devaluation (Update3)
By Telmo Almada and Daniel Cancel
Nov. 11 (Bloomberg) — Venezuelan Finance Minister Ali Rodriguez said the government is “cautiously” studying a devaluation of the country’s bolivar, which has been pegged at the same rate for more than four years.
“The issue of when a devaluation may be needed is being studied cautiously,” Rodriguez said today in a speech at an event in Caracas. “A devaluation would immediately worsen the inflation problem even more.”
…
Economic View
Dangers of an Overheated China
By TYLER COWEN
Published: November 28, 2009
PRESIDENT OBAMA’S recent trip to China reflects a symbiotic relationship at the heart of the global economy: China uses American spending power to enlarge its private sector, while America uses Chinese lending power to expand its public sector. Yet this arrangement may unravel in a dangerous way, and if it does, the most likely culprit will be Chinese economic overcapacity.
…
It looks like there is an exciting week ahead:
Dubai, jobs, Bernanke
Sun Nov 29, 2009 5:29pm EST
By Leah Schnurr
NEW YORK (Reuters) - Dubai, jobs data, Black Friday results and a chance for Congress to throw fireballs at Fed chief Ben Bernanke: The U.S. stock market’s path to glory is fraught with peril this week.
If Dubai’s debt woes intensify and prompt a retreat from riskier assets, Friday’s painful drop will carry through into next week.
Investors also will contend with any surprises from a Senate Banking Committee hearing on Federal Reserve Chairman Ben Bernanke’s nomination to a second term. The hearing on Thursday could provide fireworks for Wall Street at a time when the central bank is facing scrutiny in Congress for its bailout of large financial institutions during the crisis.
In a busy week for data, this Friday’s employment report for November will be the main event with job losses expected to decrease from October. But early data from retailers on sales during the Black Friday weekend — generally the busiest shopping day of the year — reveal a still wobbly consumer.
Both the job market and consumer spending remain among the weakest links in the economy and could potentially stymie the burgeoning recovery. Encouraging data on that front could fuel the rally that has pushed the Dow and S&P to 13-month highs.
Still, investors got a cold reminder last week that the recovery will be far from smooth, when Dubai asked to delay payment on billions of dollars of debt issued by conglomerate Dubai World and its main property subsidiary Nakheel.
On Sunday the United Arab Emirates offered banks emergency support and neighboring city-state Abu Dhabi promised to provide selective support to Dubai companies, but both moves were seen as the bare minimum by analysts.
Dubai’s surprise move last week jolted investors with its echoes of the collapse of the U.S. subprime mortgage market that sent reverberations through global financial markets. It was uncertain how much exposure U.S. banks have in Dubai, though fears of a wide impact had ebbed by Friday’s close.
…
I thought “gulf” and “rift” meant the same thing. Isn’t “Gulf Rift” curiously redundant?
* BUSINESS
* NOVEMBER 30, 2009
Worries Grow Over Gulf Rift
U.A.E. Pledge Is Little Comfort to Dubai
By CHIP CUMMINS and ANDREW CRITCHLOW
DUBAI — The United Arab Emirates central bank said Sunday it would make fresh funding available to local banks if needed, but didn’t offer specific support to Dubai, raising worries of a rift between the struggling city-state and the U.A.E.’s federal government.
On Wednesday, Dubai said it would seek to delay debt payments of its flagship company, Dubai World, spurring a swoon in global markets last week. The federal government in Abu Dhabi, which bailed out Dubai to the tune of $10 billion earlier this year, hasn’t yet indicated fresh support, shocking investors.
According to people familiar with the situation, federal officials, bondholders and even some executives who had worked for months with Dubai and Dubai World officials on their financial woes hadn’t been warned ahead of time about the debt-standstill announcement.
“Nobody checked anything with anyone,” according to one of these people.
The central-bank move appeared aimed at boosting confidence in the country’s banking sector, which has large exposure to Dubai debt, before Monday, when banks and stock markets reopen after a long Muslim holiday.
The central bank said it “stands behind” U.A.E. banks and would make available funds to local institutions, including local subsidiaries of foreign banks.
But the statement pointedly didn’t mention Dubai, disappointing many market observers. Spokesmen for the Dubai government and the federal government in Abu Dhabi declined to comment Sunday.
The central bank could still issue a more explicit statement of support for Dubai before markets open Monday.
Abu Dhabi and Dubai are two of seven, semiautonomous emirates that make up the U.A.E. The capital is based in oil-rich Abu Dhabi, reflecting the emirate’s outsized wealth and power in the federation. Officials in both places have long denied any rift.
At a bankers conference in Dubai early this month, Dubai’s ruler, Sheik Mohammed bin Rashid Al Maktoum, delivered a prepared address about Dubai’s optimistic economic prospects in Arabic. Then he briefly switched to English to berate the media and other critics for fanning speculation of a rift with Abu Dhabi.
“So, to the people of you who nag over Dubai and Abu Dhabi, shut up,” he said. The audience laughed and applauded.
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More
* Debt Follows String of Troubles for Dubai Ruler
* Central Bank Statement
* U.A.E. Authorities Block London Times
* Blog roundup: Meltdown Raises Concerns
* Complete Coverage: Crisis in Dubai
* Discuss: How much will Dubai hurt markets?
* Readers React: ‘Wait until Monday’
Yep ,lets just continue to bail out gamblers ,you know ,the high risk takers
who don’t see things coming ,the type that Eddie thinks is the salt of the earth .
I really think we have turned into a World of gamblers ,not investors . Investors would weight the risk .Gamblers are the wishful thinking sort that go for the big killing ,the get rich quick sort of approach ,the sell to a greater fool approach .
The Big Casino called Wall Street morphed into this sort of high leverage gambling ,(with other peoples money )and the action or game became more important than the sustainability of the underlying asset . What am I talking about ,some of those Wall Street games don’t even have underlying assets .
“The Bermuda Triangle of financial hurricanes.”
Talk about mixed metaphors. That’s like a Floridian saying that we’ve entered the San Andreas Fault of wildfires.
Some banks are too bad to be had at any price.
* BUSINESS
* NOVEMBER 30, 2009, 12:16 A.M. ET
Buyers Take a Pass on Some Failed Banks
By MATTHIAS RIEKER
People’s United Financial Inc. wanted to buy failed banks on the cheap. Instead, it struck a deal to buy a healthy equipment-leasing company.
Last Monday’s change of plans by the Bridgeport, Conn., bank-holding company underscores a problem with the growing pile of terminally ill U.S. banks being wrestled with by the Federal Deposit Insurance Corp.
Some are in such bad shape that potential buyers won’t touch them at any price, even if the government agrees to eat losses on the failed bank’s bad loans. In addition to their depleted capital, many seized banks operate in areas with sluggish growth prospects, are puny and are loaded with expensive deposits gathered through brokers that are likely to leave when the acquiring bank reins in interest rates, some bankers complain.
Philip Sherringham, chief executive of People’s United, said it is getting harder to find the dream deal that bank officials hoped to hatch from a wrecked bank. The supply of ideal targets—sensible deposit-gatherers that fatally “overextended” their loan portfolio—is slim and the competition fierce, he said.
The company’s roots go back to 1842. Its biggest deal was the 2008 purchase of Crittenden Corp., including six banks owned by the Burlington, Vt., company. The financial crisis has given People’s United an appetite for dying banks that nevertheless might have some valuable pieces.
A Chittenden branch in Burlington, Vt. Its owner, People’s United, bought an equipment firm when it failed to find a lender it wanted.
But of the 124 banks to fail so far this year, many of those put up for sale by regulators as part of the seizure process “are of very poor quality,” said Norm Skalicky, chief executive of Stearns Financial Services Inc. “It’s not as if you can walk in and you are in business.”
…
Economic Preview
Nov. 29, 2009, 10:37 a.m. EST
Economy still too weak to create jobs
Friday’s report should show 100,000 lost jobs in November, survey says
By Rex Nutting, MarketWatch
WASHINGTON (MarketWatch) - The U.S. economy is slowly recovering, but it’s still not strong enough to create any net jobs, economists said ahead of a busy week for economic news.
The biggest report of the week will come on Friday morning with the Labor Department’s estimate of November’s employment situation. Economists surveyed by MarketWatch expect a 23rd consecutive month of job losses, with nonfarm payrolls forecast to fall by 100,000 after a 190,000 decline in October.
The good news: That would be the fewest jobs lost since January 2008. A year ago, nearly 600,000 jobs were lost. The bad news: The unemployment rate would remain at a 26-year high of 10.2%.
…
Related stories
* More Dubai-style reality checks ahead? (Nov. 29)
* Economy is still too weak to create jobs (Nov. 29)
* Seven mistakes fund investors make most (Nov. 29)
* Economy is still too weak to create jobs (Nov. 29)
If you look at that chart of average rents in Southern California in the L.A. Times today, it looks like rents are the same today as they were eight quarters ago, after how many thousands of people have lost work in the area in that time. That’s what I’m seeing in the market as well. Frustrating. I don’t give a rat’s sphincter about a 5% decline when rents nearly doubled in 10 years.
Cheaper housing is a total falsehood, look at both coast in this country and prices are still foolishly high and border on obscene really.
$300 to 600k for 1956 houses in very bad area’s is not what you call cheap by any means. In 1956 these cracker box homes were sold for $12,500, so when the so called experts tell you a near bottom is happening please without laughing in their face tell them to peddle their fish some place else.
The rather naive public has now been enlighten and they have had enough of the smoke and mirrors of very over inflated junk being passed off as cheap and good buys.