Bits Bucket For November 30, 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 bankruptcy of the United States is now certain.
From Porter Stansberry in the S&A Digest:
It’s one of those numbers that’s so unbelievable you have to actually think about it for a while… Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that’s not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That’s an amount equal to nearly 30% of our entire GDP. And we’re the world’s biggest economy. Where will the money come from?
How did we end up with so much short-term debt? Like most entities that have far too much debt - whether subprime borrowers, GM, Fannie, or GE - the U.S. Treasury has tried to minimize its interest burden by borrowing for short durations and then “rolling over” the loans when they come due. As they say on Wall Street, “a rolling debt collects no moss.” What they mean is, as long as you can extend the debt, you have no problem. Unfortunately, that leads folks to take on ever greater amounts of debt… at ever shorter durations… at ever lower interest rates. Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that’s when the trouble starts. Interest rates go up dramatically. Funding costs soar. The party is over. Bankruptcy is next.
http://www.thedailycrux.com/content/3455/Porter_Stansberry
If the bastards really want to screw those who see what is coming, they’ll stop issuing T-Bills. You want Treasuries? Lock it up for ten years plus.
Fire up the printing presses.
Buyers Take a Pass on Some Failed Banks.
WSJ ~ 11-30-09
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.
banks operate in areas with sluggish growth prospects I am beginning to think this is a nationwide problem, not limited to small banks or poorly capitalized ones. If prospects were better, one might imagine new banks springing up to simply steal business from all the zombie banks.
It raises the question, how are the big banks showing profits in this environment?
how are the big banks showing profits They’re false prophets.
” It raises the question, how are the big banks showing profits in this environment.”
Financials can show any profit they want if given license to do so by the supposedily overseerers. Extend & Pretend is a policy that currently seems to be a favorite.
Plus they can borrow from the government at approx 0% then loan this same money back to the government for approx 3%.
A caracature of fractional reserve banking balooning the money supply, but only inside the banks.
Flew without reserves
must land that plane, can’t crash it
extend and pretend
” It raises the question, how are the big banks showing profits in this environment.
Financials can show any profit they want if given license to do so by the supposedily overseerers. Extend & Pretend is a policy that currently seems to be a favorite.”
Imagine that you owned a business that sold candles and plastic pirate swords. Imagine that you were trying to sell that business. Imagine that when a potential buyer asked to see your books, you told them, “Sure, but you have to understand, candles and plastic pirate swords are exempt from generally accepted accounting principles, because of the worldwide financial crisis. We carry this merchandise at the prices we would like them to have, not the prices they actually sell at. Furthermore, when people buy things in this store, we don’t actually make them pay. We make them say what they might pay if things were better. Then we tell the city government to print us vouchers and all is well.” Then when the potential buyer asks what good are vouchers, and how do you redeem them, you reply - “You need to be too big too fail, don’t you know that?”
Imagine trying to conduct transactions in an environment like that, and you can understand how phony asset values, phony profits, graft, and corruption permeate the banking system today.
I seem to remember looking at Japan in the late 80s and early 90s and telling my best friend they’ve totally corrupted their banking system.
Also seem to remember mentioning that it would take 20 years to fix it and they would be an afterthought in 5 years.
My friend was taking international business as a major while learning Japanese.
Hey, as long as we have those mountain dealios on the Coors can that turn blue when the beer is cold, then why should we worry? the road to hell is paved with naval gazers….
“..the road to hell is paved with naval gazers….”
You mean those people who stand on the shore and watch the ships sail in and out?
hah, call me miss malaprop. everyone else does!
They are borrowing large piles of cash for 0% and investing in treasuries or playing the market.
They are reworking loans and selling them to the gov.
They are using accounting tricks.
Also ,they are paying out cheap money to savers ,and than
charging big interest rates to borrowers on credit cards that
they know are stuck . It called change the interest rates on the credit cards . They are raising their fees on regular bank transactions and penalizing more on overdraft and what have you .
This should be a lesson to you all ,including myself . The fact that the Bankers can change the game is great motivation to never allow yourself to get stuck in their game . Never borrow so much that you couldn’t pay it off within about 6 months or so from your regular income or budget . Car loans and home loans can be fixed so you don’t get something you didn’t plan for .
As you have seen Congress/Senate change laws after the fact
in the name of ‘Emergency” ,so protect yourself from areas that might be changed after the fact leaving you holding the
bag.
I would love to BK them all by simply not doing business with them anymore ,but the rest of the World won’t go along with me on this plan . When I don’t like the way a entity plays a game ,I get out of the stacked deck game . Why do we need
them ? Lets open up a bunch of new banks and investment houses that operate on better premises than ,I’M GOING TO RIP YOU OFF.
They call the shots ,and they think we are stuck . If I don’t like a bunch of jerks ,I don’t hang around with them .The majority is to big to fall ,not them ,they deserve to fall .
I would love to BK them all by simply not doing business with them anymore ,but the rest of the World won’t go along with me on this plan
As quoted from a banker during a conversation with a real-estate liquidation specialist… [looking out the office window] “You see all that out there? We own it all. You just run it for us… you take care of it for us, but we own it.” an exerpt from “The Millionaire Mind”.
As quoted from a banker during a conversation with a real-estate liquidation specialist… [looking out the office window] “You see all that out there? We own it all. You just run it for us… you take care of it for us, but we own it.” an exerpt from “The Millionaire Mind”.
How true. And how sad that so few people actually recognize that.
I recently closed my B of A checking account after much thought of doing so over the course of the past several years. I had banked with them for over 20 years, so it was a big change. Shortly thereafter, I received a $75 refund from a local business (they were low on cash- go figure) which was drawn off of a B of A account. I went right into the branch which was just down the street in order to cash it. Since I had just closed my checking account, they would not cash it unless they charged me $6. I could not believe my ears. Only if I deposited it in my own account and it cleared their bank would I not be charged. The $6 was because they were “providing me a service since I wasn’t a customer”.
Needless to say I marched right back to the business and demanded cash which they gave me. I told them their bank is running off their customers. They agreed, and told me they were going to phase out those accounts and go with the local credit union.
Its not real difficult, Banks take deposits at practically zero interest (look at the CD rates these days) from people who, rightly so, fear any investment that is not insured, and/or borrow money from the Fed at practically zero interest rates, then either buy Treasuries at a 2%+ spread, or loan to solid gold business and personal borrowers at a 5% or 6% spread. Pretty easy math. Throw in the huge fees they earn for any kind of “service”, and the reductions in backroom costs as everyone moves to a checkless transaction system, and the banks are printing money on a current business basis.
If it weren’t for the junk on their balance sheets from the bubble years, it would be high times for the banks indeed. But, if it weren’t for that, they would be earning more normal spreads.
The line of credit at my company is a floating interest rate based on prime which would normally price around 3.75% in this credit market. However, the loan agreement has a 5% interest rate floor, so the bank is probably making a 4.75% spread on that money. Trouble is, right now, it is not possible to renegotiate the terms of the loan or find another lender, banks are just not lending except on an overcollateralized basis these days.
‘cash is king’ haiku:
cash is king. Look there
*poof* *poof* goes the fake money
keep a suitcase full
Chuckles and grins.
don’t walk, says combo
keep paying that high mortgage
god knows gov is broke
no goldbug for me
more *poof* *poof*, and gold bubble
melts into tungsten
“don’t walk, says combo
keep paying that high mortgage”
Lol. Right on; Double-up on the payments if you can. Tell your friends to do the same.
“god knows the gov is broke”
There it is.
Thanks! whoomp, there it is.
look for the last of the blood
squeezed from the turnips
Bravo oxide, bravo.
Plow the banks under.
Fruit rotted and withering.
No interest to glean.
My polls? Low. My cred?
Lax. I don’t even know how
To use Turbotax.
Such talent on the HBB! Combo and oxide - you must be Japanese!
Combodioxide.
Island in the Skye
Clouds of CombodiOxide
Invisible Blue
Blogging together
And writing a few haikus
Enriches us all.
On Ben’s Bubble Blog
We comment on the meltdown
Shared schadenfreude
Wall Street steals money
Buy now; before it’s too late
Diane said its OK
Used home sellers lie
To make you want McMansions.
“Suzanne researched it!”
LOL great stuff today.
Does this imply that winding down rather than transfering ownership of banks by the FDIC is likely to become more common. Does anybody here have any idea of how the costs, both direct and in personnel are going to be different?
Case in point was when Citizen’s Bank ( est. 1958 w/ $500 mil. in deposits ) was asked to take over our failed local bank ( est. 2000 w/ $300 mil. in busted loans and broken dreams )
FDIC has been auctioning off their dream loans and fax machines in an effort to shore up their reserves. With countless more dead and dyin’ banks in the wings. Collectively, how is this any less impactful than MegaBank going under?
“dream loans” - ‘Cause they dreamed that they’d be repaid?
If it weren’t for those pesky state regulators burdening those poor innocent banks with draconian oversight and inspections they wouldn’t be in such bad shape upon failure.
Oh wait…
Detroit needs housing rebound to spur pickup sales
Sales of pickups languish as ongoing housing slump hurts demand for a Detroit moneymaker. ~ Sunday November 29, 2009
DETROIT (AP) — At Kevin Haner’s construction company in Las Vegas, three of the four Dodge Ram pickup trucks are starting to get a little old. He may replace one if he gets a great deal, but he’ll keep running the others until he’s convinced that the housing slump has ended.
Haner’s reluctance to spend is typical of contractors nationwide. This presents a huge problem for the Detroit automakers because truck sales are directly tied to new home construction. Pickup sales are on pace for their worst performance in 17 years, and GM, Chrysler and Ford still sell 91 percent of all full-size pickups in the U.S.
Even as Detroit tries to gain traction with new small cars and electric vehicles in a government-mandated shift toward greater fuel economy, it needs to sell more Rams, Chevrolet Silverados and Ford F-150s. Pickups often sell for $30,000 or more and typically command higher prices and generate more profits than small and midsize cars. They account for 22 percent of sales for the Detroit Three. Until pickup sales rebound, steady profits and solid financial footing will likely prove hard to come by.
Haner and others have reason to be cautious. While October new home sales were up 6.2 percent over September, construction of homes and apartments fell a larger-than-expected 10.6 percent, and building permits, a key indicator of future construction, slid 4 percent.
“I’m not inclined to take on any more exposure until I see that the building-housing market is thoroughly back out of recession,” Haner said Wednesday after the Commerce Department released the latest reading on new home sales.
Pickups generate more profits than small and midsize cars simply because automakers were able to jack up pickup prices, pickup buyers didn’t care how much they spent, and the pickup tariff is the same as it was in the days of Smoot-Hawley. The Housing Bubble in a sense artificially propped up domestic manufacturers. The downside for domestic manufacturers is that pickups are much easier to patch & keep going than cars are.
pickup buyers didn’t care how much they spent
Anecdote: Ten years ago I helped a friend move out of his dorm room on the last day allowed (he had a late final exam). We threw a lot of stuff into the dumpster. Just as we were leaving, the dumpster divers arrived to haul off anything remotely useful. Their pickup trucks were totally pimped out, with shiny bumpers and lights on the roof and the expensive metal toolboxes and those wheel wells that sit outside the truckbed . I wondered why somebody with a $25K truck would need to bother with dumpster diver furniture — from a college dorm no less. The poor furniture was probably on its 2nd or 3rd dumpster, not exactly Stickley, and maybe not worth even the gas to haul it. Just another bloody battle in the testosterone war, I suppose.
On a side note, they didn’t put all their finds into the truckbed. They found a two-year old SI swimsuit calendar. That went into the front seat.
I wondered why somebody with a $25K truck would need to bother with dumpster diver furniture You must live in a high-rent district of the USA. In my neighborhood, the devil-strip (local parlance for curbside) scavengers run zombie pickups tricked out with duct tape, Bondo, pop-rivets & bungee cords. They are decorated by a kaleidoscope of mismatched body panels. The deluxe bumper substitutes are pressure-treated 4×4s as opposed to the untreated kinds. Mufflers, if installed, are leaky and loud. I suspect all these dumpster divers make a little cash out of reselling their finds.
Second tier city in Indiana. Lots of blue collar industrial and a major university.
I wonder if the difference is when, rather than where. After all, the Bubble allowed many people to HELOC their dream truck. Heck, my dresser is an UGLY college town moveout special. Which begs the question, keep the victorian monster that weighs a ton, or replace it with one of those sawdust and glue “modern” ones from IKEA? ‘Cause even faux Stickly isn’t in my budget.
The bedrooms in my house are furnished with old furniture I found posted on Craigslist. Sturdy, beautiful and cheap. Nobody should ever buy new, except for mattresses. There’s too much good stuff out there.
For the past year and a half we have weekly recycling scavengers who make rounds before the trucks arrive. Their trucks are rattletraps.
Yrs ago, old fr was a scavenger and got some seriously great stuff. I got quite a few expensive/collectible things. The old women loved him and gave him more stuff hadn’t been donated yet. Scavenging can or was lucrative in the day.
We used to dumpster dive. Originally for username/passwords and phone numbers to computers, but then once we got older, for electronics parts. Older police are cool, younger ones were the issue. Friends got stuck with 3 cop cars and a helicopter over digging electronics parts out of a dumpster in VaBeach. Police separated everyone and was shaking them down thinking they were trying to break into building. One guy, “HAH you guys are soooo dumb, don’t you see the huge pile of cool stuff sitting by the dumpster? These people throw away all kinds of cool stuff that still works!” Cops not impressed.
It’s hard to overestimate the intelligence of a tax collector with a radar gun…
“The Housing Bubble is a sense artificially propped up domestic manufactures.”
The Housing Bubble artificially propped up most everything in our Consumer Based Economy.
Owning a house meant a never-ending flow of tax-free, even tax-advantaged, cash that ended up creating a demand and support for such things as four-dollar lattes and pirate stores.
Those artificial days are gone, and so are the artificial jobs.
Pirate stores?
Eddie, it’s an old HBB inside joke, posted here long before you arrived to bless our blog with your exalted presence.
During the height of the bubble, lots of people cashed out their equity and opened a “small business.” Among them are a shop for pirate gear, a shop where you made your own candles, and a shop solely for scrapbooking supplies. When the bubble popped and the business failed, their sob stories found their way into news articles, and into HBB lore.
Also be on the lookout for references to the $15K/year strawberry picker who landed a $750K house in CA, and the flipper that turned out to be a corpse.
“Pirate stores?”
Yeah, everyone was going to rush into pirate stores and spend lots of money so they could dress up like Johnny Depp.
The last days of a crazy era.
I know all about the $15K strawberry picker. the pirate stores….that’s a new one. I also thought the idea of a battery store was silly but they’re all over the place these days.
People need replacement batteries for things like UPS units, alarm panels, fire alarm panels, access control systems, lawn and garden equipment, vehicles, hearing aids, and whatever else.
Pirate dress and scrapbooking, not so sure. I think an online store for those things makes more sense. Of course walmart has a scrapbooking section now. We don’t have pirate stores here, but we have party cities and halloween stores.
Well..? “I” would dress up like a pirate if it meant I could make Realtwhores walk the plank? I’ll run you through!, and all that rot?
There were scrapbook stores before the bubble and there will be post-bubble. Same with candle stores and other things like that. Except instead of having one of each in every strip mall like it seemed we had recently, there will be one every 5 or 6 strip malls.
Arrr, ye re-al-TORs
drank o’ the rum, fell behind.
we leave ye behind.
I think the pirate and candle stores will be on line only soon.
All depends on how much unwinding occurs.
Don’t forget wireless = batteries. So those battery stores may pay off in the long run.
Oh yea, remember stamping? Stampin’ up! and all that noise?
If that little back and forth about pirates didn’t get OG to come out of hiding, nothing will. Greg, what did you do with her?
Granite and stainless
pergo, new paint, “newer” roof
what, no cash? F you.
pirate stores are more believable than this place:
http://www.thealluvian.com/
built by the founder of Viking Range Corporation during the height of the bubble in the MS delta town of Greenwood…my hometown.
Greenwood, Mississippi…America’s taint.
Isn’t the MS Delta dirt poor, one of the poorest regions in the country?
yep
Viking ranges are the expensive ones, right? Are those real commercial or “pro-sumer” ? I don’t get the stainless steel consumer appliances. Why not get 2nd hand real commercial stuff, it will last much much longer than the Chinese made consumer best buy stuff.
the commercial stuff does not meet “code”. the story goes that Fred Carls wife wanted a commercial stove in her house and he could not find one anywhere that met the code…so he made her one…and then he started the viking range corp.
i will say one thing about the commercial style stoves…viking…wolf…etc. they are worth it if you cook alot IMHO. i think the wolf stoves are better quality than the vikings but i would still get a viking since they are the only industry left in my hometown.
i have a middle of the road stove in the townhouse my wife and i are renting now and i cannot cook hardly anything on it. the oven cooks unvenly and temp controls are fubar’ed…plus it’s an electric cooktop…ughhhhhhh!
Stainless steel is a b##ch to keep clean……the stuff shows fingerprints.
Query: Are smoothtop ranges good for people who really like to cook a lot? I thought gas open flame was preferred.
Open gas flame is definitely preferable to smoothtops if you’re a serious cook. Smoothtops are just electric ranges with a flat sheet of glass over them. Easy to clean, but they lack the instant cool-down of gas. The induction ones are a different story, but I don’t think they’re worth the expense compared to gas.
Gas is the choice of any serious cook…
if you really like to cook i would avoid smooth top at all cost…and yes…the open flame gas is the best…IMHO.
i am by no means a master chef but my mother and sister in law both have smooth top and they regret it. if something boils over and gets cooked on the top it’s a pain to clean.
gas top…electric oven. i know the vikings and wolf’s have the dual option. not sure about the kitchen aids/GE’s.
i rent so no real option for me.
i have mulled over the idea of going halvsies with my landlord if he would install a decent stove though.
Gas stoves are the best. with some practice you can heat tortillas directly over the flames.
Heh. I do remember people lighting their cigs that way if they couldn’t find matches.
Mmm. That was a while ago…
In the bubble years, I worked in the Marine Industry making a product the sales of which were driven by the sales of trailerable pleasure boats. Sales were soaring post 9-11 even as home sales were also soaring. I remember thinking at the time, “are people buying new houses and new boats at the same time?” Being conservative by nature, that didn’t make sense, but it seemed that it must be the case. Under any circumstances, the industry rode a nice wave from 2002 to 2007.
Today the big boat builders are currently running at about 40% of their unit sales of 2007 with no sign of an improvement on the horizion. So, yep, there were many, many manufacturing jobs created by the bubble that will likely never return.
Forturnately, I’m out of that industry, though the industry I am currently in has its share of problems as well. I guess the moral of the story is, “don’t stand flat-footed”.
Catalina Yachts is right across Victory Blvd. form my place of business and they have been dead, dead, dead. There are only 3 or 4 cars in the lot on any given day and it looks like they don’t even have inventory anymore. Maybe they’ve offshored?
There’s a great solution for $4 Lattes! I just got one for my anniversary:
http://www.capresso.com/automatic-coffee-centers-s9ot.shtml
Maybe I’ll write to Barney Frank and have him buy one of these for all the FBs so they can continue to get the lattes they deserve.
They are probably a dumpster diving small business, Dumpsterguy LLC, Delaware corporation. So they don’t pay taxes on it. So they can get a $25k truck for $18k.
The “working stiffs” continue to drive their used Accords…and love it.
Friend of mine in the landscaping business just dropped a re-built engine and tranny in one of his ‘98 Chevy trucks. Costs less all the way around. Maintenance is key, I have kept vehicles on the road for over 20 years, with regular service.
with regular service. Being able to replace major parts of the beast is also key, few auto owners are in a position to do that & succeed.
Trucks generally have a longer redesign cycle than cars, which means that parts for older ones are more easily available.
Ebay is good place to look for auto parts.
I paid $25,000 for my loaded pickup truck 5 years ago, after all discounts. The same truck in 2009, after all discounts, is $34,000. That’s a 36% increase, in the middle of a recession, on a product built by a company that might cease to exist at any moment. I’ll pass, thank you.
But, but that’s not deflationary!
Seriously. You wanna get good deal on a light duty truck (P/U)? Shop used and well kept.
“Pickups often sell for $30,000 or more and typically command higher prices and generate more profits than small and midsize cars.”
It’s more like $40k+, and it often over $50k just 18-months ago for a turbo diesel powered pickup truck. Every teenager just out of high school up this way feels that a new pickup truck is a birthright. And why not when they’re financed with a balloon payment loan that taxpayers will eventually own?
I have an coworker whose unemployed husband drives one of these super expensive beasts (A Toyota).
Did he haul stuff as part of his old job? No
Did he tow anything? Just his boat.
I am amazed at how many people think trucks are “cool”. They’re gas guzzlers, they handle like crap, they flip over.
Other than for work purposes, why would anyone want a pickup truck?
Because they’re safe? Everytime we have a bad winter storm here you can make a game of counting the flipped over pickups and SUVs in the median along I25 between Ft. Collins and Denver.
Yup, worst traction EVAH. The suckers who buy them seem to think the mere fact of purchasing the rig *handles* the snow and ice problem for them. Love to watch them spinning out in first gear. LOL
Hence the joy of a 60’s VW bug. My ‘60 went places where no man or boy could go in their souped up rigs (60-70s). Bug got through places w/o chains long after others were stopped. And if you really got stuck, heck 4 strong people could lift the darn thing over the ‘hump’.
I know, I had 3 VW’s. Even the ‘67 bus was fine. Although, one time I did a 360 in Jackson Hole, but fortunately that was on snow with big snow berms to stop me on each side. So I just kinda bounced around and giggled.
I have a friend who is a dentist
Bought some massive pickup truck and deducted it from his taxes. He uses it to drive to work????
He won’t deduct it for long. That’s one of the first things the IRS looks for when they audit, and self employeed professionals are one of their favorite targets, especially the ones that do their own tax returns.
A vehicle can only be deducted to the extent that it is used for business purposes. Driving to and from work is specificly excluded. It would be very hard for a dentist to show very much of a business purpose for any vehicle. They might allow a milage deduction for going to pick up crowns from the lab, but not much more.
hard for a dentist to show very much of a business purpose for any vehicle.
Dentists could put a Giant tooth in the bed and advertise.
But that would definitely rot the Cool factor.
“But that would definitely rot the Cool factor.”
Even if the tooth had a huge diamond in it?
tooth had a huge diamond
Good idea!
No, no, no. It has to be a GOLD tooth
Nope, the Service long ago established that slapping a little graphics on a vehicle doesn’t constitute a business use of the vehicle. Pay someone else to do so, and that’s ok.
Those guys have seen it all.
One of the reasons I got my real estate license is that 1099 income and the opportunity to write transportation expenses off the top. Tell me Spokaneman that it’s ok!
The purchase price is indeed deductible specifically for vehicles over 7000 GVW IIRC. Cost to operate is only deductible when used for business, but htere is no requirement to split out the portion of the purchase price personal vs. business.
RE, It’s okay but keep good mileage records.
Pay someone else to do so, and that’s ok.
SO, if I put my business magnetic sign on my mom’s car and pay the O.H. on her car…it is Good to go for IRS?
Other than for work purposes, why would anyone want a pickup truck?
For folks who don’t need a pickup truck for work there is usually a need, once or twice a year, when they need to actually use the bed of the truck to haul something. This reminds them of the usefulness of the truck.
Needed 1 good fr w/truck for 1-2x pr yr usage. Will pay in 6pk and KFC bucket.
The only time I need a pickup truck is when I’m moving a piece of furniture. I either borrow or rent one (renting is cheap enough from my local Lowes) for the occasion.
Around here, the hockey/soccer moms love their big SUVs aka ‘land yachts’ that barely fit in the garage. I don’t get it.
If the mom has more than two children, she needs a land yacht. You can only fit two car seats in the back.
They actually put them in the garage??!! ‘Round here its generally accepted that vehicles belong OUTSIDE the garage. Inside is where all the boxed belongings one hasn’t seen in years reside.
sleepless,
Have you heard from Olygal?
Went to my nephew’s soccer game a couple of weeks ago……pulled into the parking lot and started LMAO.
Literally HALF the vehicles in the lot were silver or white Honda Odessey mini vans (including the SIL’s)
We always had minivans when the kids were younger and we were transporting basketball teams around northern California. We hated them but they fit 7 kids and were relatively cheap. No need for a gas-guzzling Yukon.
Hi SFBAG,
Nope, I haven’t heard from her. I’ve been sporadic in attendance here myself and only recently learned she’d disappeared from posting. Hopefully she just needed some downtime away or perhaps her job has caused her to be more focused there, as mine has for me lately. Cheers.
Never understood the p/u fascination, and I grew up in the South. Used to be only good old boys had the mega trucks that could tow a house behind it. Now they’re as common as mini-vans in suburban parking lots. Each to their own I suppose.
The paper here yesterday showed a photo from 1940 of some local guys who had bagged an elk and tied down on the hood of their ‘39 Buick sedan. Not all that uncommon.
Nowadays, of course, one must buy a special rig in order to go hunting.
Yeah but come on. A 1939 Buick is about as big as today’s p/u.
Every try to haul engine blocks, trannys, rear differentials, 2×4s, or bags of concrete in a car? You can make it work, as long as you don’t mind trashing the car.
Out here in Flyover, the “second car” has been a pickup truck since at least the early 70’s. The process accelerated when cars started getting real expensive and downsized back in the 80’s……for a while, trucks were cheap, and a lot better value than a car was, especially when gas was relatively inexpensive.
This started to change in the late 80s-90s, when trucks started getting optioned out like luxury cars. You used to be able to pick your options, and make a truck as nice or as cheap as you wanted.
Now, your options are either a V-6 standard cab cheapo work truck, or a decked out club/crew cab……nothing in between. If you want a standard cab truck with minimal options other than a big V-8 and tow package, good luck. If you can actually find one, it will be a 3/4 ton.
X-GSfixer,
So true. The last new vehicle I had was a 1996 Ford F-150. Straight 6, man. trans. I felt so lucky to find a new one that was ‘just’ an XL. Virtually every other one around was at ‘least’ an XLT.
From there it only went up! Eddie Bauer… XLT etc. We owned acreage at the time and it seemed like I was forever borrowing one or making arrangements to do so.
One of ‘my’ big complaints has always been that those lugjury options are the first things to go! I can’t recall ever having a man. adj. seat “go out” on you?
Every try to haul engine blocks, trannys, rear differentials, 2×4s, or bags of concrete in a car?
That’s when I RENT a truck. And I haven’t had to in a long time.
A couple of years ago I bought a few cubic yards of red volcanic rock from a local landscaping supply company.
They were more than happy to deliver it for a $20 fee.
Bought a 1999 F-150, was a standard cab, XLT with a 4.6, 5-speed MANUAL and a tow package……I wanted a V-8, standard cab truck; out of the 100 plus trucks they had in stock, this one and a 3/4 ton (XL 4×4, with a 5.4, auto, rubber floor mats, no options,,,, a snow plow special) were the ONLY standard cab V-8s that they had. The GM, Dodge and other Ford dealers in town didn’t have ANY standard cab V-8s.
Note to blog: Don’t try to tow a stock trailer any distance with a 4.6L F-150……..especially with a 40mph headwind.
Don’t try to tow a stock trailer any distance with a 4.6L F-150……..especially with a 40mph headwind.
So on top of being expensive they are actually useless unless equipped with a 400HP engine?
You can’t haul anything like engine blocks in a rented truck….unless you buy the all the supplemental insurance.
Besides I was/am an “on call” employee. Which means that you do personal stuff around the airplane’s schedule (which changes all the time) and not around the hours the local U-Haul or rental car agency is open.
I can deal with the limitations of owning a pickup truck. I can’t (and won’t) deal with the limitations of owning a Honda Accord. that doesn’t mean that Accord owners are idiots.
I just wish the Accord owners would quit acting like all pickup truck owners are idiots.
X-GSfixer,
If your job or routine life involves hauling engine blocks, then yes by all means a p/u is an essential vehicle. But for 95% of the population that owns a p/u in the city, the most they will ever haul is groceries and maybe a new bbq from home depot.
Don’t get me wrong, I’m not one of these people who thinks everyone has to drive a Prius. I just don’t get the fascination with them by the non-engine-block-hauling city dwellers.
Pick-ups are like pools, or boats. I encourage all my friends to own one.
You can’t haul anything like engine blocks in a rented truck….unless you buy the all the supplemental insurance.
That’s OK, I’ve never hauled one in my life, and I doubt that any of my neighbors haul engine blocks in their pristine trophy pickup trucks either.
Never understood the p/u fascination
My first vehicle was a 1962 Chevy shortbed, Fleetside, 1/2 ton pickup.
As a single guy, moving from apartment to barracks to apartment, I found that being able to put everything I owned in my car was a great advantage.
Later in Tucson, as a mortgage owner and enthusiastic weekend landscaper, pickup trucks were almost a necessity, especially with the houses on acre+ lots.
If I ever own a mortgage/home again, I’ll probably buy another pickup.
Just sayin’…
Early fascination w/hunks who own vintage trucks. Don’t know what it is about early trucks…Rounded lines, great sounding engines.
Buy a ranch and you’ll find that you NEED that
damn truck fifty times a day. They’re a necessary evil.
Exactly, Rancher. You need a pickup truck. My glamorous friend with manicured fingernails and designer clothes who drives one with nary a scratch, not so much.
I think it’s all about street cred. See also: Suburban kids in skater clothes or pants around the butt-tocks and Moms in SUVs instead of minivans.
Dudes in pickups. Gives off an aura of “I work with my hands and take a shower AFTER work” even if reality is that you’re a dentist.
even if reality is that you’re a dentist
And your truck doesn’t have a single scratch on it.
or it has a truck liner. geesh…. My neighbor used to have a humongous truck and everyday put his teeny-weeny lunch box in the back cuz it certainly wouldn’t fit in the passenger seat. … clean as a whistle otherwise….
I recently helped a lady at a furniture consignment store wedge a wrought-iron table tightly into her BMW 5-series SUV. As I pointed out she should drive carefully because the legs were tightly wedged against the roof upholstery, she said, ‘I should have my husband pick this up in his Tundra, but he doesn’t like to haul anything because the bedliner scratches too easily.’
‘What does he own pick-up with a bedliner for?’, I asked, slightly jokingly.
‘Oh, he just likes driving it,’ she replied.
I have a truck for convenience use…I removed the bed and put on a flat bed..That made it even more useful..The unfortunate side of it is that it becomes very convenient for everyone to use it…
Yup, my mom has a truck, lives out in the country. Only need to borrow it once every couple of years at the most. Otherwise, we manage, SOMEHOW, to haul everything in our sedans. Bunji ropes rule.
Saw a hybrid Suburban at the local Chevy dealer a month or so ago……..thing stickered out at almost $70,000. I about gagged.
So, the best way to resurrect a dead city is to make the housing expensive? The sheer lunacy that having higher housing prices is good so people can borrow against those houses to buy things they can’t afford with money they don’t have is what doomed the economy in the first place!
Heaven help us… when will this insane idea that high housing prices are good for the economy end?!
3-4 years from now?
The start all over again.
I went window shopping for a new pick-up at my local Ford dealer this past weekend to replace an aging - more than ten year old Dodge Ext cab 4×4. Wow - what an eye-opener. I thought I’d find good deals. All I found was a lot full of trucks that started at 35K plus for a similarly equipped truck.
Who in the heck is buying this stuff? The sticker shock was astounding! There was hardly a vehicle on the lot less than 30 G’s. Ford Fusion at 29K, Ford Edge at 37K? Are you kidding? I think the Edge is built on the Taurus platform.
Wow, the housing bubble seems to have extended to the auto industry. I recall reading an article a number of years ago that indicated a large number of new vehicles were purchased with equity loans.
This can not end well. I make good bank - great credit, and I would no more than buy at this level than than I would invest in AIG.
I thought it might be a good time to buy a “new” vehicle - looks like I’ll stick with my buy used practice. Last new car was a 1986 Acura. New car buying may now be a bigger knife-catching activity than buying a house.
My “new” jeep - 1995 Gran Cherokee, $ 2,000, put in about $600 in maintenance/repairs, runs like a dream, many, many miles, but I’m only driving it in the winter in bad weather, car payments ? Zero….it’s a survivor. Cost to insure each month is $ 31. I couldn’t be happier.
Treasury to meet with mortgage servicers Monday.
WASHINGTON (Reuters) - The Treasury Department is expected to meet with lenders on Monday to press them to do more to rework troubled home mortgage loans, a source familiar with the Treasury’s thinking said.
Herbert Allison, the Treasury Department’s assistant secretary for financial stability, is expected to meet with the mortgage servicers, said the source who requested anonymity because the meeting has not been publicly announced.
The New York Times in its Sunday edition quoted Michael Barr, the Treasury Department’s assistant secretary for financial institutions, as expressing dissatisfaction with lenders over the slow pace at which they are amending loan agreements to help borrowers make their monthly payments.
A Treasury spokeswoman said on Saturday the department was taking additional steps to enhance mortgage servicer transparency and accountability as part of a broader focus on maximizing conversion rates to permanent modifications.
The Treasury spokeswoman said that that could include new resources for borrowers and said the department will announce new measures on Monday.
“The Treasury Department is expected to meet with lenders on Monday to press them to do more to rework troubled home mortgage loans, a source familiar with the Treasury’s thinking said.”
Isn’t this article from Jun 2008?
The problem is that a high percentage (I mean very high) of people don’t have the income to warrant a modification. It’s either they keep making payments or a forseeable foreclosure which is more of the later.
Detroit’s Coon Man takes orders for the holiday Grass Lake, MI —
There was no moon and the old fella tripped over the darkness trying to keep up with his hounds.
The dogs were deep in the forest somewhere, baying at a raccoon they had run up a tree.
The old fella picked himself up and sat for a spell on a damp log trying to collect his breath.
“Most people dies in a nursing home and give up,” he said in a thick backwoods drawl, dressed in greasy hunting greens that smelled of wood smoke and raccoon musk. “I don’t mind if I die out here. Least I got something to go for.” …Michigan gave him everything a man could ask. It gave him three children, five grandchildren, two great-grandchildren. It gave him a job and a house. It gave him clean water and big woods and plenty of wild game. “It give me a lot, Detroit. I’m not quitting it. It wouldn’t seem right. Somebody gotta stay. Maybe if it was like it was, like it used to be, then I feel like I could do it [i.e., move out]. But I can’t. I can’t. I’m thankful for what the city give me. I guess I’ll go down with it.”
“I’m thankful for what the city give me. I guess I’ll go down with it.”
And that’s how I feel about my country, the US. I’m not leaving, I’m going down with the ship, if the ship ends up sinking. I am truly grateful for the life I’ve had here.
Oxide,
I’ve been to almost as many countries as we have states, and I can honestly say that, push
come to shove, this is where I want to be when
the SHTF. We have the BEST country in the world
even if our government has gone to h#$@.
Anyone ever see those old documentary films about the guy who lived on his own up in Alaska? They’re on PBS from time to time. It’s not what I would choose to do, but that guy really made a life of it, building his own shelter and storage, gathering his own food (for the most part, of course he did have tools and other stuff from civilization).
In the end, a person does create his own life.
Great show but… I have to wonder if, like Thoreau he couldn’t have managed it without some money. He certainly didn’t seem to be hunting or growing enough food to survive on. So flour, beans etc need cash, as well as some kerosen for lighting.
And if he has an acute appendicitis in the middle of January, he’s probably royally screwed.
I remember that guy. All you need is one broken leg and you’re a goner.
I saw a documentary about Chris McCandless, the college guy in Into the Wild, who tried the same thing and starved to death in two months. Later on, they looked at pictures of McCandless, and they suspect he dislocated a shoulder.
“I saw a documentary about Chris McCandless”
Read the book, it’s amazing. The movie ain’t bad either.
Chris died because he ate the leaves of a plant and it was a mild poison. Would have been ok if he had stuck to the berries but the text he had wasn’t clear.
Died in his sleeping bag of starvation for lack of a little bit of sugar that would have counter acted the chemicals in the leaves.
Not reading any great lesson into this though. You can get dead pretty easy hiking or messing around in nature.
You could also argue that he died because he chose to go in there without readily-available information. He was strong enough to almost succeed in walking out—until he hit the swollen river and couldn’t cross it. Little did he know that there was a cable-car crossing that he could have used only half a mile downstream, which was clearly indicated on the USGS sectional.
Moral of the story: always take along a USGS map. He could have chosen not to use it except for emergencies, but deciding in advance not to _take_ it along was foolish.
He intentionally decided not to have a safety net to enhance his experience, and quite an experience he did have.
Great book, though.
Actually, there was a recent documentary done on Chris that disproved the seed theory in Krakauer’s book. It was the initial theory, but they interviewed the Ag dude at U of Alaska and he said it turned out to be a dead end.
Book is still worth reading, the documentary was kinda dull but worth it for the new information. I think it was called “call of the wild”
“Anyone ever see those old documentary films about the guy who lived on his own up in Alaska? They’re on PBS from time to time. It’s not what I would choose to do, but that guy really made a life of it, building his own shelter and storage, gathering his own food (for the most part, of course he did have tools and other stuff from civilization).”
You’re talking about Dick Proenneke who built his own cabin by hand in Twin Lakes, Alaska. He used all hand tools, and the only thing which was purchased was the plastic liner for the roof and some bags of cement if I recall correctly. He felled trees, and sawed all of his own boards, even making the wooden locks for the doors. That guy was amazing- a true craftsman. I love that documentary. I think it’s called “Alone in the Wilderness”.
I’d love to do that for a brief time, but I could never last 30 years like he did. I know my own limitations, and I need some warm hugs from the ladies every once in a while at the very minimum.
Read “Caruso of Lonesome Lake”.
Story of Ralph Edwards who pioneered a place at Lonesome lake in BC inland from
Bella Colla.
He build his own trolly line from wood to
move the logs he felled for his house.
Well I agree with both of you. If the SHTF, the US still has the option of doing a total retrench.
oxide,
And I suppose that’s why I’m not as dour here as most. I recall speaking w/ an older very established CPA a year or so back and he talked about when he was a young accountant in Oregon back in the early 80’s.
He said if I could have gotten his hands on $100k ( he thinks he could have bought the State? ) OR’s are in the -constant- state of retrenchment! It’s a never ending process of building ( and RE-building ) your practice time and again.
Dreading new entrants into your market and the constant fear old clients will leave. We’re forever rebuilding our lives here? As a matter of fact, it’s the only thing we -are- assured of?
Same here in Colorado. It’s always been a boom and bust economy here.
In Colorado,
Oh I certainly didn’t mean to leave ‘you people’ out of the mix? If anything, it’s even more acute where you’re at! It’s hard to explain to folks that have enjoyed a stable career/bus. that we go through a re-invention of ourselves every few years or so around here?
So, no, I don’t find the idea of having to “retrench” as being that intimidating at all? Kind of like the movie “Stripes” where Bill Murray implores the platoon to have the “black guys “help out” the white guys with the beat!” That’s why we keep getting these “Our lives were going along just fine until we got “blindsided”! type articles.
“That’s why we keep getting these “Our lives were going along just fine until we got “blindsided”! type articles.”
Of course at maximum leverage, it doesn’t take much to constitute at ‘blindsided level’ event. It’s amazing how many folks were one parking ticket away from disaster.
Hell, I’m not dour. I’m rather enjoying this spectacle. I was wondering where everyone was getting their “money” in 2002-2007 and now I know.
Cheers!
Article from feb about ex-pats running away from Dubai and their tough debt laws. Over 3,000 cars just abandoned at the airport.
‘http://business.timesonline.co.uk/tol/business/markets/the_gulf/article5663618.ece’
My sentiments exactly, palmy. Better off in the good old USA than anywhere else.
And I call BS to the coon-guy. Jackson is nowhere near Detroit - it’s west of Ann Arbor!
I’d like to reiterate a post from yesterdays bits bucket (from Matt in TX)
FICO score “Damage points” to be released (info in article)
financeDOTyahooDOTcom/banking-budgeting/article/108239/fICO-reveals-how-common-credit-mistakes-affect-scores?mod=bb-creditreports
Some quick numbers:
If your FICO is 780 (which is most of us), you lose:
Maxed out credit card: 25-45
30-day late payment: 90-110
Debt settlement: 105-125
Foreclosure: 140-160
Bankruptcy: 220-240
That 30-day late number scares me stiff. If you forget to mail your credit card payment once, it’s as bad as debt settlement? That’s why I don’t use credit cards.
I assume - hope, pray, etc - that is additive. In other words, getting to a Foreclosure typically involves missing a payment by 30 days, so the hit would be 230 - 270. Once the debt is settled wouldn’t it add another 105-125, taking it up to a damage point score of 335-375 for what we on the HBB consider the full spectrum of foreclosure.
Which would only serve to confuse the people trying to game the system as they only see “Foreclosure: 140-160″ and promptly mail in the keys.
I’ve never understood the ’system’ either? Years and years of perfect payment history derailed by (1) late payment? There’s never been a Time Value built into the evaluation.
If you’re fresh out of college, make a few payments on time and then flip off the world, your good/bad ratio is about 50-50. If you and the wife have been making timely payments since you married in the 80’s ( or even earlier? ) your (1) late payment carries the same weight?
Don’t get it. And as such, no longer care.
It would be nice if I could no longer care. But I need that FICO for an eventual house, or to get the best insurance rates. And don’t they check credit for jobs these days? The system is so interconnected that one mistake will go viral.
I once missed one credit card payment in 2005. I wrote out the check, but instead of mailing it, by mistake I put it back in the drawer and didn’t see it until the next time I paid bills. I had never missed a payment in 10 years, but my god, you would have thought I had taken an Uzi to Fort Knox. I was slapped with a $39 late fee, and all three of my credit cards sent me nastygrams and jacked up the rates from 9% to 26%, and sent separate mailings trying to sell me debt relief and credit fixes and monitoring up the wazoo. Since then, the only time I use credit cards is for plane tickets or cars. And I’m paranoid.
Eddie, I’d like to set up all sorts of electronic goodies, but I’ve had to move every 3-5 years, and it’s difficult to uproot, and I don’t trust fully online banks.
oxide,
Good points all. And ‘if’ you have designs on owning a home someday, it could well come in handy. In the early going, I was convinced my target mkts. of LV and PS would provide the kind of pyrotechnic thrill I was looking for?
But after hearing about all the shennanigans realtwhores were pulling there.., I pretty much packed it in? At some point the wife and I will be looking for a modest snowbird home, but by that time it will be an all cash or mostly cash deal? So who needs it!
It would be nice if I could no longer care. But I need that FICO for an eventual house, or to get the best insurance rates. And don’t they check credit for jobs these days? The system is so interconnected that one mistake will go viral.
All the more reason to make it illegal to uses credit scores for anything othen than the granting of credit. It puts too much power in the Bankster’s hands.
Stop being so paranoid.
First of all don’t mail anything. Pay electronically or use ebills and it’s all on auto-pilot. I have all my ccs set up to be paid in full as soon as the bill is received. I get an email confirmation when the bill comes in and when a payment is processed.
Second if for whatever reason the payment doesn’t make it, if you’re a top tier client, the lender will waive your fees for being late and won’t report you to a bureau.
I know banks are evil but they’re not stupid. They won’t lose you as a client to make a quick $40 late fee and then lose $5000 in future fees after you cancel the card and go to a competitor.
Eddie,
For myself, or anyone else here to be “paranoid” it would tend to imply that we actually ‘care’ about any further use of credit?
Ahem, again, the bigger point is that an entire lifetime of loyal debt service can wiped out in just (1) bad year. Divorce, serious illness etc. Until they address those inequities, I don’t have any faith in it.
Besides, there’s only a handful of younger posters here. Most of us shouldn’t be that enthused about being issued -further- debt levels at our age.
OK fair enough, paranoid is too strong a word. Sorry. How about overly risk averse?
Did you miss the part about paying the balances in full that I wrote? I’m not advocating getting into debt. I’m advocating taking advantage of a) the ease of credit card use and b) the interest free loan ccs give you every month and c) the freebies ccs give you.
What I’m telling you is that missing one payment on a credit card after making 100 payments on time will not ruin your credit. At worst, you get your next statement before 30 days have passed from the due date of the previous statement and you make the payment then. Bureaus are only informed when accounts are at least 30 days past due. Having a due date of 12/1 and the payment gets there on 12/2 does not mean your fico goes to 500.
“Did you miss the part about paying the balances in full…”
Eddie, if I ‘did’ it’s only b/c I’ve seen that same defective logic played out here and elsewhere so many times over the last few years I guess I’ve gotten immune to it?
Every talking head from Paul B. Farrell to Suze Orman to Clark Howard and Ben Stein share that same position. And… it doesn’t work. It just makes people feel good and it makes for polite conversation at cocktail parties.
In truth, paying in full before the end of the billing cycle needs to be placed right next to the myth of using the rhythm method of contraception? Great idea but one little slip..?
I missed a credit card payment once, and the credit union blocked access to every account I had with them (the balance of the credit card only a fraction of my account balance with them.) It was reported to the CRAs. They never told me I had missed it, and it took days to straighten it out because their own systems wouldn’t let me pay my debt with them with my money that was with them. They had to unlock my account so I could pay them. But it took 2 or 3 days to figure this out, each time around. Good thing I had cash in hand.
Mistakes are made, but I’ve never had a problem I do the same as Eddie - have it set up to automatically pay the bill in full as soon as it hits the bank - one day following the close of the cycle.
In addition, I have it set to pay $20 (a minimum payment for the balances I run - typically gas once a week) payment a week following the close of the cycle. That way if the automatic e-bill gets messed up for whatever reason, the $20 will hit the account and at least make it current. Of course, I’m on the bank & credit card sites at least once a week, so I just don’t see the need for this because I know what is going on at all times.
I’ve lost far more misplacing my wallet than I have dealing with credit card companies over the past 10 years.
The only automatic payments I make are my utilities. I don’t trust banks so I pay my mortgage and credit card online myself every month. I’m afraid that if someone stole my card and racked up a lot of charges that my bank account would be overcharged or even overdrawn. I prefer to look at the statement before I pay it. And yes, I know that they would credit the overcharges later, but I just don’t want to give the credit card company automatic access to my money.
And I like the airline miles.
I do the same as Eddie as well: use cards and pay in full every money. It has worked well for me for the past 20yrs, and I’ve never had problems.
I also am like REhobbyist: ” I prefer to look at the statement before I pay it.” I much prefer that if we have a dispute, that THEY are the ones out the money while we discuss it, rather than me arguing to get my money back. That worked extremely well for me in one particular instance.
If I drive somewhere there is a chance I might get a flat tire. And I’ve read all these stories about people getting flat ties, so I know it happens a lot. So just to make sure that never happens to me, I will never buy a car.
Eddie . If i was late on a damn bill and I got charged for it ,unless it was a mistake ,I don’t spend a bunch of energy trying to get out of my penalty .
You know that’s part of the problem with this World today ,its all about not paying for your mistakes . Oh, I can get out of this because I have a connection . Oh ,I can buy a bunch of shit and never have to pay for it by screaming VICTIM . The Banks and
Wall Street say …We can live to fleece you again because we got bailed out and didn’t pay for our crimes ,and we even get to keep the Casino .
What about the day when there is nobody left to fleece , everybody is poor and game is over and the one percent has everything and the Politicians have their jobs . Does the one percent build big walls around their Mansions so the people don’t riot and find them and string them up by their____ .
The greed machine doesn’t think about where their actions might lead to . Common criminals don’t think about what their
actions might lead them to .
Its a BIG BEE HIVE and a portion of the Hive went haywire and if not destroyed there goes the whole Bee Hive .
I’m not surprised the credit scores track that way. The losses from one default probably exceed the income from a lifetime of good payment.
Well I’m not generally one that has much good to say about the debt-pushers, but arguably they SHOULD be more worried about current credit history than about the past. The question is: is a recent problem due to a transient problem, like forgetting to mail a check, or a change in circumstances, like losing one’s job, or a divorce?
Eddie, is there any time you don’t disagree with everyone here just to disagree? What world do you live in where banks “waive fees” for you? Seriously?!
“I know banks are evil but they’re not stupid. They won’t lose you as a client to make a quick $40 late fee and then lose $5000 in future fees after you cancel the card and go to a competitor.”
Right, because the behavior of the banks thus far has been a model of both honesty and good business practices… right…
Actually Eddie has some good points here. We
bank locally with a national bank and we’ve
slipped up a couple of times on payments, purely accidental. The bank has gone out of its way to smooth things over without a word of
late fees. Maybe it’s the amount of money we
siphon through their maze but they go out of
their way to keep us their customers. Same
thing with the CC we use.
Fine pay with cash for everything and write checks. I’ll live in the 21st century, you live in the 19th. No skin off my nose.
awwww the poor banks…….
Martha look what they’re saying about our beloved banks!!! This cannot stand! oh dear God for the love of our banks!!!
Maybe I’m just old and paranoid, but the less electronic access that people have to my checking account, the better. I’ve never had a problem with my paper checks, but have had my electronic info hijacked twice in just the past year.
Yeah, I have to sit down and write checks a couple of times a month …….no BFD.
The problem with the FICO scores is that it really doesn’t take into consideration your income (liquid capital). I have tons of capital and my income is high. I keep my debt under control but I also have debt spread out in many different vendors. I actually need a assistant to manage it becuase I have a busy schedule and I travel quite a bit.
So I checked my credit score recently. It’s not too bad. Some derogatory based on some small utlity bills and a Cell company asking for their money. (which is in dispute) That is pretty good since I have a little more than 15+ some odd bills I manage. These bills still total10% of my yearly income.
Now, if you take some person with a total of $2500 of debt and has a score of 800 and making $25,000/yr. Are you willing to lend him money? I am conscious of my credit report but I don’t look at it religously. I still believe Cash is king but I have more clout when I look for loans becuase of what I can generate income-wise.
Credit Card comments:
Eddie makes some valid points here, but so do others. In my experience, if you have sterling credit/payment records with cc companies, they will waive late fees. I know, because I had the flu and a sinus infection to beat the band last month, and had missed payingTHREE cc payments on time. I NEVER do this. Well, what with being sick, vomiting, and trying to work fulltime/then stumbling home and going to bed, I missed them. I got all three companies to remove their fees. That being said, had I set up automatic payments with our checking account, this never would have happened. I don’t have automatic payments set up for credit cards because I want to scan the bills before I pay them, and what if, God forbid, there isn’t enough dough in the checking account when the bill comes due ? I’ll pay it myself and not have to worry about it, transferring money from savings to checking as I need to, online…
We have closed 4 credit card accounts in the last 6 months. One was for rudeness when I had an inquiry, one was for letting our electronic i.d. be hijacked twice and we just didn’t feel they were careful enough ( we had the cc in our possession the whole time ), and one for charging a very high interest rate after the initial teaser rate was over, and refusing to lower it enough to my satisfaction. See ya.
I do have the mortgage electronically debited from our account, in weekly payments. I’m quite happy with that arrangement because the mortgage is paid before the first of every month. We’re happy and the lender is happy. I pay all bills online and have the bank mail out the checks. It saves me quite a bit of time by not having to write out each check by hand, and saves us a large amount of money in postage each month. I’m happy that way.
We are seldom broke, if ever, have better weekly cash flow, save time, and have a high savings rate for our retirements each month, so it works out for us.
The reason fico doesn’t take income into account is because statistically speaking how much you make has no effect on how well you manage debt. All FICO does is use past behavior to predict future behavior and quantifies it as a whole number on an arbitrary scale. If you have an 800 chances are excellent that you won’t want to borrow more than you can handle in the future based on the fact you haven’t borrowed more than you can handle in the past.
Whether you make $25K or $250K or $25M doesn’t factor into the equation.
Some observations from my afternoon of home shopping yesterday:
Went to a couple of golf course communities out in the northern Atlanta exurbs, maybe 30-35 miles from downtown which is 45 mins w/o traffic, 75 with. Prices have fallen a lot out there, more so than in the city as you would expect. Over the past decade there was an explosion of building out there and what was once farmland in the early 90s, is now McMansion subdivisionville along with the requisite malls at every interstate exit. In general I wouldn’t want to live that far out, but there are two specific older more established areas that were worth checking out. And since I play golf at least once a week, the thought of living on a course is appealing. 9 holes at 7:00 every day would hit the spot nicely. Plus crime is non-existent there and property tax on a ~4000 sq ft golf course lot on 1/2 acre is less than a 1500 sq ft house on 1/8 acre in the city. And as an added bonus I might actually send my daughter to a public school there and save the $10K a year private school tuition I would have to pay if we lived in the city. Not being sarcastic about that, the Atlanta/Fulton schools are abysmal, nobody sends their kids to public school if they can help it.
The builder is still putting up homes and they amazingly are selling, although slowly. There are no empty or 1/2 finished houses sitting around like in so many other areas. They started building in 1999 and 10 years later still building. Slow and steady. It’s not like the typical place where they’ll throw up 100 houses in 2 months. They’re semi-custom homes on large lots, and about I’d guess 80% of the lots are either on the golf course or have a course view.
So there is this one house that went into foreclosure. The builder bought it back and renovated it top to bottom. So it’s essentially a new house but in an established area with landscaping already in place, fenced yard, etc. it’s directly on the golf course and even better on a tee-box so no danger of balls flying into your yard as there is on a fairway. 5 bedrooms, 3850 sq ft, 1/2 acre. Asking price is $579k. Original selling price in 2002 was $590K according to the county assessor’s website.
As we’re getting ready to go inside a brand new BMW 5 pulls up. I had seen that car driving around as we were driving around the community and told my wife, I think they’re doing the same thing as us, checking out houses. A couple in their mid to late 50s gets out. The agent says hey you guys want to see this house too, they say yeah, we all go in, take a look.
As we’re about to leave Mr. BMW asks the agent about financing options. This is where I was a little taken back. Mr. BMW says that their house has lost so much value that all their equity is gone. And instead of “giving it away to someone, we’re giving it to our two kids to live in as a gift”. My thought was, damn, lucky bastard kids. Then Mr. BMW asks what is the lowest downpayment they could do to get into one of the houses. The agent says if you have good credit 95%. If you have excellent credit, over 800 and no significant other debt we might be able to do 100%. They have their own mortgage financing arm.
After they left I talked to the agent too and said, seriously, you’re still handing out 95 and 100% loans? And he said year we pretty much have to, otherwise we wouldn’t be able to sell anything. And this is for houses that start at $450K and go up to $850K. He said they’ve done a few 100% jumbos at 5.5% recently. Aside from the one foreclosure we saw, I didn’t see any others there. Not to say they don’t exist, but they’re not listed for sale or seem abandoned at first glance driving down the street.
The house in question was amazing and I’m tempted to throw out an offer. And if they’re handing 100% loans at 5.5%, what the hell. Prices fall in 2 or 3 years, I walk away essentially having rented the place with a tax deduction. If prices hold steady, I have a fixed loan at 5.5% and having purchased a house in 2009/2010 at sub-2002 price levels. It’s a good hedge either way I think.
That’s how I spent the last of my 5 day TK weekend.
“Prices fall in 2 or 3 years, I walk away essentially having rented the place with a tax deduction.”
…except Georgia is a recourse state.
What percent of residents are behind on their HOA dues? What’s the condition of the HOA’s finances? Are you automatically a member of the golf course or do you have to buy in? Have you considered the possibility of the course closing, and that nicely-manicured fairway behind your house turning “natural?” That’s happened in several communities in the Bluffton area, near Hilton Head. What happens to the value of your house when you no longer live in a golf course community?
I don’t see the golf course going away any time soon. It’s a popular course, I’ve played there a few times over the years and it’s never wanting for people. Kind of an easy course, but with enough challenges for the true golfer too if you play from the tips. Which is what you want, the duffers and serious players can all enjoy themselves.
Anything’s possible of course. Just like buying on a beach there is erosion or buying in the mountains there is the chance of fire or buying in the city there is the chance a public housing project gets built nearby or buying the country a meth lab moves in next door. There’s always a risk of something happening to your surrounding area. If the premise is don’t ever buy real estate because something bad might happen in the future, then sure, nobody should ever buy anything anywhere at any time.
The golf membership is not included but the country club membership is, which gives you access to the pool, tennis courts, fitness center, clubhouse. There is a discount for greens fees without the membership.
“It’s a popular course, I’ve played there a few times over the years and it’s never wanting for people.”
It’s not so much a question of how popular the course is, but how it is capitalized. If it is heavily leveraged, it has a much higher chance of closing due to a small decrease in income.
That said, if it is an older, move established community, the odds of it going under are probably much lower. But it still might be worth checking into the amount of debt that it carries.
“It’s not so much a question of how popular the course is, but how it is capitalized. If it is heavily leveraged, it has a much higher chance of closing due to a small decrease in income.”
Exactly. Eddie sounds absolutely oblivious to the structural flaws which are causing all of the problems.
“That said, if it is an older, move established community, the odds of it going under are probably much lower. But it still might be worth checking into the amount of debt that it carries.”
Absolutely, but a lot of the older courses were sold off to “investors” during the boom. Best to check on changes of ownership, etc. More than just a few older courses are going belly up. In fact, more courses have closed than have opened the past several years nationwide and the future does not look so bright. Younger people are not embracing the sport as they once may have, it’s expensive, and there is excess supply. Golf is in trouble.
Have you considered the possibility of the course closing, and that nicely-manicured fairway behind your house turning “natural?”
Happened to the PS Club GC. All natural and as Oly would say, “purty like”.
So is CA and NV and nobody in those states walked away, right? I’d be about number 167,277 on the list of people in line to sue by lenders. And if 3 years from now prices fell enough to the point where I’d walk away, I’d be the least of the worries of said lenders, assuming they’d still be in bidness.
You are absolutely correct, Eddie. This an opportunity that will never - ever- come again. I say GO FOR IT!!
Buy two if you can.
Combo, you crack me up.
CA is non-recourse.
CA is non-recourse.
So’s Nevada - sort of…
“Nevada - note that the lender CAN get a deficiency judgment (See below)“
So your not a computer generated program Eddie ,your a real person thats shopping for a house maybe . Your already saying you would walk if you don’t win on the house purchase ? What if the government all of a sudden makes a law that non-recourse loans become recourse loans because in the interest of
“Emergency” they have to save the lenders ? Than you wouldn’t have a out on the perfect no-risk investment ,(I thought you said you were a risk-taker and we were a bunch of paranoids ).
This is really getting interesting .See how moral hazard works .We have new potential l buyers already planning to walk if they don’t win ,and they haven’t even bought the house yet .
CA is non-recourse ??
Not all loans…
Hw:
Exactly right. I’ve said this numerous times here. I don’t make the rules, I just play by them. If the govt sets up a system where people are able to walk away, you’re damn right I’ll take advantage of it. I’d be stupid not to.
Besides most of you missed the salient part of what I wrote. The asking price for the house is lower than the price paid almost 8 years ago. And this isn’t an isolated case. That’s about where prices are these days in the area, anywhere from 2000-2003 levels. I remember a lot of people said a sign to buy would be when prices got to late 90s, early 2000s levels. What happened to that?
No. 1980’s level and we’re not there yet.
Eddie,
We are still at 2003+ levels out in Westside of Los Angeles.
A long way to go here. I believe inland LA and plenty of other places are very close to the bottom.
“After I left I talked to the agent too, and said, seriously, you’re still handing out 95 and 100% loans? And he said (this) year we pretty much have to, otherwise we wouldn’t be able to sell anything.”
What is the term for this, vendor-based financing maybe? Where the seller in effect loans the money to the buyer so the buyer can buy the product, otherwise the product won’t be sold?
Desperate times call for desperate measures.
What is the term for this, vendor-based financing maybe? Where the seller in effect loans the money to the buyer so the buyer can buy the product, otherwise the product won’t be sold?
No different than the captive finance companies of the auto makers. How many $30-50K cars would be sold if GMAC or Nissan Acceptance Corp., etc., weren’t there to provide liquidity?
If his equity is gone, wouldn’t that mean he owes more than it’s worth? “Hey kids, if you’ll just sign this here paper, we’re giving you the gift of an upside-down mortgage!”
Hopefully for the kids Mr. BMW just meant he would make the payments while the kids live there, waiting for the fabled rebound in house prices.
SFC,
Agreed, AND if that was the basis for generating walk aways, wouldn’t everyone just turn their car back into the dealership after 29 days?
As long as the borrowers continue to make their housing payments on time ( and I never implied they were happy about it? ) then there’s no issue. Even if people equity skimmed the living hell out of their own home, if they’re making the payments, is the current appraisal really a problem?
It’s the people that ES’d and ran out and bought TEN homes that are making this scenario insurmountable.
“If his equity is gone, wouldn’t that mean he owes more than it’s worth? “Hey kids, if you’ll just sign this here paper, we’re giving you the gift of an upside-down mortgage!””
This sounded like a buy-then-walk setup to me.
He gets a new house with a lower payment (at 100% LTV), and his kids get a free place to live for a couple of years. Everyone wins!
i see it more like this scenario: they bought for $500K 10 years ago. Put down 10-20% as was the norm. Paid the mortgage over the past 10 years and now owe $300K. The house was once worth $800K during the peak of the bubble. Now it’s down to $400K. So they “lost” $400K in equity but in reality they’re still doing just fine and do have have some actual equity built up. And handing the keys to the kids while the kids make the mortgage payment is in their view a better option than just “giving the house away to some stranger” by selling it for “only” $400K.
I’m totally speculating from overhearing a 2 minute conversation of course. But that was my impression of what was happening not they’re $100K underwater and are trying to scam their kids into taking over their mess.
Why on earth would you want to have a 3800 sq ft house?
The heating and particularly in Atlanta cooling costs must be astronomical?
Do you have parents living with you and 5 kids?
Just me my wife and daughter for now. Maybe a second little one in a year or two. Guest room and office and there’s 5 bedrooms. We’d probably finish off part of the basement and make that a game room when the kid(s) get older.
Heating/cooling is as much factored on the house as the size of teh house. I’m renting a 2700 sq ft house now that was built in the 60s. I pay more to heat/cool it than a friend of mine who has a 4 year old 4000+ house. His house has triple paned windows, new insulation, new A/C, new furnace. My house has crappy everything including single paned windows that leak air like you wouldn’t believe. I was originally against buying something newer since I like the older houses/neighborhoods better. But after living in an old house I’ve come to the realization that old is not always good and the awful efficiency is one of the reasons.
Also the house in question, as is the case with most newer houses have 2 or even 3 separate heat/cool zones with tehir own thermostats. So at night you only heat/cool the upstairs and only cool/heat the downstairs during the day. Older houses just have one zone which means you’re always heating/cooling the whole house even when nobody is in 2/3 of the rooms. Very inefficient.
So moving to a new bigger house would actually save money on utilities. And utility rates are much cheaper out in the burbs than in the city since there aren’t 15 layers of city/county taxes to pay.
In older more established nabes, why don’t you just do a complete rehab,gut-teardown, use the slab as grandfathered in, to your spec and efficiencies?
Just a thought.
+1 DD. It’s not that difficult to put in new windows, or even to divide an existing HVAC system into zones.
new windows, roof, furnace, a/c, floors, kitchen, bathrooms, insulation, pipes, wiring….yeah just a couple of weekends and you’re done.
yeah just a couple of weekends and you’re done.
Eddie, you are the one who mentioned older mature neighborhoods. Can’t get that in new suburbs.
For me, even 2700 sq feet is a gigantic house but not sure that includes basement space. No basements here in the land of shaking ground.
I looked at a couple of plans on the net. I’d guess some of the large open front forier (OK… I don’t know how to spell that word) with spiral staircases could be like that.
They are not very space efficient but have that southern mansion look about them. Perhaps with the great room that opens to the second floor.
A big house is not for me any more. I have plenty of other places to put my money. I’d rather save and invest.
I did the big house sprawling house in the country with giant horse barn, multiple pastures and 20+ acres. The dang thing just takes over your life, you are the farm. Vacation becomes farm repair and improvement time.
If I’m spending extra money on the house it will probably be in Malibu for views or on the water.
You undoubtedly have much greater financial means than I do if you’re considering the purchase of a half million dollar home, but in the end we will all only make X dollars in our lives. When we purchase one thing, we’re necessarily giving up other things. Just make sure that the purchase is in line with what you really want out of life. Otherwise, go for it.
As an upside, I’d guess a private golf course would be nice because you wouldn’t have to wait while terrible players (such as myself) spend thirty minutes swinging a club at dirt.
From my experience, unless you like being awoken by raunchy jokes at the crack of dawn, don’t buy next to a tee box unless it is one of the last holes and they don’t start people off on the back nine.
Eddie, you don’t need to give $30,000 per year of interest to a bank. Use your cash and make a 50% downpayment and benefit from a low fixed rate of 4.75%. Then you’ll have your mortgage interest deduction of $13,000, but you won’t be fleeced by the bank. And you’ll be paying the equivalent of rent and you’ll own it.
And you know that you can’t walk away from it- you have money and they’ll get it from you. The only people who can walk away in Georgia are those with no money who aren’t worth suing.
Sounds like it meets your needs and it’s back to its 2002 price. Go for it.
“on a tee-box so no danger of balls flying into your yard as there is on a fairway”
You haven’t seen my slice!
http://www.huffingtonpost.com/2007/12/04/documents-expose-huckabee_n_75362.html
Mike Huckabee, a darling of the Evangelical Right, pardoned both the prime suspect in the killing of four police in Washington and a serial rapist who went on to rape and murder again.
There’s no active body of voters who will end the careers of politicians who show “clemency” to monsters, and no branch of the MSM that gives a hoot about the practice. The current NW WA executioner suspect was, after all, released on bail by a Washington state judge just a few days before the murders, Mike Huckabee was not responsible for that action. The rot goes deep and has spread widely.
There’s no active body of voters who will end the careers of politicians who show “clemency” to monsters,
Willie Horton?
Willie Horton, remember him???
Oxide, I see you are a very smart person
sorry for the cyberspace cross post.
Great minds.
Dang you must have forgotten Willie Horton and Lee Atwater. The rot was going on then.
Knowing how Huckabee is a Bible thumper, I think M. Huckabee did “The Christian thing” by letting convict go. This is akin to George W. Bush refusing to have troops invade mosques. The mosques contained arsenals of weapons later used to kill many U.S. and allied troops. Bush made that order because he “respected” the Muslim faith.
This is the wimpy “Christian way” which results in death of innocent people.
Go, Switzerland! No minarets for you!
And this has what to do with housing? Oh - nothing.
And this has what to do with housing? Oh - nothing.
“Post off-topic ideas, links and Craigslist finds here.”
Thats why we call it the Bits !!
This just proves what many have suspected….that the GOP is soft on crime.
Gumercinda Juarez tells Indy Mac bank that $5033 is mucho dinero for nuestra casa. Lower my payment por favor.
Administration plans new efforts on foreclosures
Enlarge Photo Homeowner Gumercinda Juarez, left, whose monthly mortgage payment increased from $2200 to $5033, joins a protest in front of Indy Mac bank offices in Tuesday Nov. 24, 2009 in Pasadena, Calif. Families affected by Indy Mac’s refusal to modify loans,is causing families to go into foreclosure and subsequently lose their homes. (AP Photo/Damian Dovarganes)
By MARTIN CRUTSINGER
The Associated Press
Updated: 11:06 a.m. Sunday, Nov. 29, 2009
WASHINGTON — The Obama administration, battling a foreclosure crisis that shows no signs of relenting, will step up pressure on mortgage companies to do more to help people remain in their homes, officials said Saturday.
The administration will announce its expanded program on Monday, Treasury spokeswoman Meg Reilly said.
“We are taking additional steps to enhance servicer transparency and accountability,” Reilly said. She said the goal was to increase the rate that troubled home loans were converted into new loans with lower monthly payments.
Industry officials said the new effort would include increased pressure on mortgage companies to accelerate loan modifications by highlighting firms that are lagging in that area.
The Treasury is also expected to announce that it will wait until the loan modifications are permanent before paying cash incentives to mortgage companies that lower loan payments.
Under the $75 billion Treasury program, companies that agree to lower payments for troubled borrowers collect $1,000 initially from the government for each loan, followed by $1,000 annually for up to three years.
The government support, which is provided from the $700 billion financial bailout program, is aimed at providing cash incentives for mortgage providers to accept smaller mortgage payments rather than foreclosing on homes.
The program has come under heavy criticism for failing to do enough to attack a tidal wave of foreclosures. Analysts said the foreclosure crisis is likely to persist well into next year as high unemployment pushes more people out of their homes.
Rising foreclosures depress home prices and threaten the sustainability of the fledgling economic recovery.
A report last week from the Mortgage Bankers Association found that 14 percent of homeowners with mortgages were either behind on payments or in foreclosure at the end of September, a record level for the ninth straight quarter.
The Congressional Oversight Panel, a committee that monitors spending under Treasury’s bailout program, concluded in a report last month that foreclosures are now threatening families who took out conventional, fixed-rate mortgages and put down payments of 10 to 20 percent on homes that would have been within their means in a normal market.
Treasury’s program, known as the Home Affordable Modification Program, “is targeted at the housing crisis as it existed six months ago, rather than as it exists right now,” the report said.
Scott Talbott, senior vice president of government affairs for the Financial Services Roundtable, said the industry supported many of the changes Treasury was proposing.
But he said the foreclosure problem, which began with heavy defaults on subprime mortgages, was expanding to more traditional types of mortgages because of unemployment which has now hit a 26-year high of 10.2 percent.
“The subprime problem has regrettably morphed into an unemployment problem,” Talbott said. He said there was no government program to help the unemployed who are in danger of losing their homes but “many private lenders are modifying loans for the unemployed on their own.”
$2200 to $5033
An increase like that has liar-loan-neg-am reset ==> full amort written all over it. And now I have an answer to the question I asked long ago.
Q (bank): You already signed at a super-low rate. So, you a want a refi. Refi into WHAT? There’s nothing lower.
A (FB): But I just reset higher. Refi me back into the teaser loan that I had when I started. I don’t make nearly the income for this beautiful McMansion, but keep me here for impossibly low payments. And if you can’t, I’ll protest and get on the news, and Obama will help me.
Obama is getting it from all sides. Gimme gimme gimme says Main Street, or I’ll vote you out. Gimme gimme gimme says Wall Street, or we’ll crash your banking system.
The only fair way to do this is to put some onus on both the banks and the FB’s. Make some deal for a restricted cram-down, which will allow the FB to stay in the house. Or have some program where the FB is forgiven the debt (BK) and has to move out, but instead of straight no-credit-for-you, allow for a downsized house and mortgage but no other credit. I could think of a few other compromises, but none of them will happen. The FB’s won’t give an inch, the banks won’t give an inch, and Congress is bought and paid for. I don’t see any way out.
She’s a grand old flag,
She’s a high flying flag,
And forever in peace may she wave.
She’s the emblem of,
The loan I love,
A free home where I don`t have to pay.
Every heart beats true,
And there`s food stamps for you,
Health insurance is in the bag.
Hit one for english don`t forget
Keep your eye on the grand old flag.
I am going back to work now, so I can pay my bills and taxes.
oxide,
That’s… pretty much it. Again, I don’t have any issue w/ lenders and borrowers coming to terms for the common good. As LONG as we’re talking about a person’s ‘home’.
As far as salvaging someone’s “real estate portfolio” of failed investments..? No.
“An increase like that has liar-loan-neg-am reset ==> full amort written all over it.”
It could also just be a teaser-rate of 1.5% resetting to a (manipulated, so-called) market rate of roughly 5%.
It still cracks me up that people actually WANT to stay in their homes… underwater.
No kidding. And 2000+ for a monthly payment? That’s just stupid unless you are rich and buying a nice house.
And even then…
Donb’t know if this one was posted over the weekend, but it is interesting.
http://www.nytimes.com/2009/11/29/business/economy/29modify.html?_r=1&em
I wonder if any of the decision makers ever sat in a room with investment bankers at the financial printers and saw some [fill in epithet here] snap his fingers at the facilitator to demand menus, drinks and assorted chocolate to get the evening/night/early morning going. I have. Trying to make them look bad won’t work. It is most likely they don’t understand the concept. The ones that do understand, don’t care.
IMO it’s all about keeping people in their homes and convincing them to keep up with their house payments. All else follows from this.
It’s about keeping hope alive.
If it takes lies and false promises to accomplish this then lies and false promises it will be. There is really little choice in the matter.
Er, this was meant to be a response to the post above this one.
Combo, I know what you’re trying to say. The middle class is muddling along with a teeny little left over at the end of the month. If banks drain out that teeny little bit for a long enough time, plus a little inflation and a Freddie loan or two, the banks will grow out of this mess.
But that’s simply not enough. Consumers, as the Prof says, are fundamentally broke. The FB’s can’t keep sending that little bit for years on end — they’re likely to lose their job along the way. And really, they would die of old age before they paid off what they owe.
But then again, it seems to be working at the moment, which is all they care about.
This begs the question of what will happen when/if gas goes back up to $ 4.50 per gallon for regular. What little bit is leftover at the end of the month for the middle class now will be sucked up for fuel costs, plus plus, and the monthly mortgage will get paid late, or never. Things are just barely balanced to keep most middle class members ( who are still working, of course ) paying their house notes now. If something else goes awry, banks, hold onto your skirts, cause a new tidal wave of foreclosures is going to be sweeping onto the beach. It will be interesting. If even I, someone who has deep savings and has money to invest in retirement savings each month, has even had the DISCUSSION with my spouse on whether to eventually walk away or not, as I documented a few days ago, then I can only imagine what the truly hardpressed are going to wind up doing. For the record, we’re not walking away, but our payments are fixed and low. We will have to rent the place when I retire if we can’t sell it. That’s 6 years from now, so we may have some leeway, plus we’re experienced landlords and the mortgage payment is lower than most rental rates in this sub…
Maybe a repost—
Over the extended weekend I watched a couple of dopes on one of the MSM cable news networks….. I forget their names but the topic was housing and surprisingly, they indicated that a new bubble is forming in the “low end” housing segment and that 11% of all defaults logged this year were from house buyers that bought…… ready for this? In 2009.
This isn’t really news for us but a confirmation signal to validate our own view/perspective etc. Also I think the broadcast is a good indication that at least some of the MSM is reporting some truth about the housing price and sale volume collapse.
Sticky going down.
Get rich bottom feeding? Ha.
You’re just knifecatching.
Oxide is on fire with the haiku’s - I love them…keep em’ coming!
“Putting all our eggs in the `grow-the-market’ basket ” - Now, What Could Possibly Go Wrong???
Las Vegas rebound riding on $8.5B CityCenter
By Oskar Garcia, Associated Press Writer
On 6:39 am EST, Monday November 30, 2009
LAS VEGAS (AP) — Sin City is pinning its biggest bet ever — $8.5 billion — on a 67-acre, six-tower complex of striking hotels, gourmet restaurants, swank shops and a single casino that starts opening Tuesday in the heart of the Las Vegas Strip.
Many watching the high-stakes roll of the dice shudder at the thought that nearly 5,900 rooms in three hotels will be awaiting guests when CityCenter’s crown jewel — the 4,004-room Aria Resort & Casino — opens Dec. 16. That will increase Las Vegas’ already saturated inventory by more than 4 percent at a time when fewer visitors are coming and room prices have fallen 25 percent from last year.
CityCenter’s debut might pull rates even lower, but state leaders hope the complex leads Nevada out of two years of economic misery that has hit the state with record unemployment, foreclosures and bankruptcies.
“We’re in a 12-round fight. The first six rounds, you guys got beat up,” Tony Alamo of the Nevada Gaming Commission told CityCenter owners MGM Mirage and Dubai World when Aria’s license was approved.
“We’re putting all our eggs in the `grow-the-market’ basket. I would be lying to you if I wasn’t concerned — that’s a reality,” he said. “This is not just the company, it’s the state.”
When The Mirage opened in 1989, it launched two decades of expansion that more than doubled the number of rooms in Las Vegas to some 141,000 today. A record 39.2 million visitors came to Sin City in 2007, but that dropped to 37.5 million last year as the recession kept many people away.
Sin City’s rapid growth came to a halt, crippling casinos and construction, the state’s two largest industries. Nevada’s unemployment hit a record 13.3 percent in September.
According to the Las Vegas Convention and Visitors Authority, most of about 40 projects that have been proposed or started haven’t determined completion dates.
Is there any way to sell Las Vegas short?
I think so, if you can compile a list of public companies in the gaming and resort business. Just call it the “Bow”, as in bow-wow, for dogs.
Best time to short LV was in 2005 (or 2006) when the first reports were out that Pulte Homes started cutting prices of new homes in some LV areas just months after a group of recently-built homes were sold. I remember reaading that back in those days.
San Diego and Las Vegas bubbles were the first to pop.
Oh, the morlocks in the sewers there must be in trouble. Probably due to over crowding.
Las Vegas still has a ways to go down. So overbuilt and lets see how things look after a decade of savings hits the casinos.
Short BJK.
Why would one additional hotel, or a few more restaurants, convince someone to vacation somewhere? What am I missing? I could see if all the other hotels were full, or there weren’t already 100’s of restaurants there. Has anyone in history ever said “if only they had 100 ’swanky’ stores instead of only 98, I’d love to spend a week there”?
Some poor employee at in the developer’s office probably did. He would have said “look, having 100 swanky stores instead of 98 isn’t going to push people over into spending a week here.” And, he would have gotten fired for it.
What am I missing ??
What happens in Vegas stays in Vegas
Say, what better follow up to two decades of phenomenal growth than…than two more decades of phenomenal growth!
Sequioas in the Desert.
Is Dubia still a main backer of this project?
Roh-roh!
Vegas is going to double down on a loosing hand.
You got to know when to hold em
Know when to fold em
Know when to walk away
Know when to run
Now is the time to RUN
It was a fun little town for a musician to work circa 1970. Good union jobs, nice environment (at least in the hotels).
I don’t want to see the place anymore.
Viva Las Vegas
Bright light city gonna set my soul
Gonna set my soul on fire
Got a whole lot of money that’s ready to burn,
So get those stakes up higher
There’s a thousand pretty women waitin’ out there
And they’re all livin’ devil may care
And I’m just the devil with love to spare
Viva Las Vegas, Viva Las Vegas
How I wish that there were more
Than the twenty-four hours in the day
‘Cause even if there were forty more
I wouldn’t sleep a minute away
Oh, there’s black jack and poker and the roulette wheel
A fortune won and lost on every deal
All you need’s a strong heart and a nerve of steel
Viva Las Vegas, Viva Las Vegas
Viva Las Vegas with you neon flashin’
And your one armbandits crashin’
All those hopes down the drain
Viva Las Vegas turnin’ day into nighttime
Turnin’ night into daytime
If you see it once
You’ll never be the same again
I’m gonna keep on the run
I’m gonna have me some fun
If it costs me my very last dime
If I wind up broke up well
I’ll always remember that I had a swingin’ time
I’m gonna give it everything I’ve got
Lady luck please let the dice stay hot
Let me shoot a seven with every shot
Viva Las Vegas, Viva Las Vegas,Viva Las Vegas
Viva, Viva Las Vegas
- Elvis Presley
You mean the Dead Kennedy’s didn’t originally write that?
(kidding)
Nah, they were having too much fun in Cambodia….
Just listened to ZZ Topp’s version. Lots of fun.
OK, I’m going off topic. I’m supposed to go to a meeting held at Bally’s hotel in LV in six months. Should I stay there or elsewhere? I don’t know LV very well.
OK, I’m going off topic. I’m supposed to go to a meeting held at Bally’s hotel in LV in six months. Should I stay there or elsewhere? I don’t know LV very well.
Bally’s is an older property, but well situated. I don’t have any experience with the rooms or service, however.
No! Stay someplace else! We stayed there for convience sake a year or so ago. Terribly old rooms circa 1980’s. UGLY decor. I would recommend Bellagio, unless Bally has recently remodeled.
Stars End
Thanks, Stars. I usually like to stay at the meeting hotel, but this time I’ll pass. I have a feeling that the rate will be cheaper if I book on my own at the Bellagio rather than go with the meeting rate.
An Empire at Risk
We won the cold war and weathered 9/11. But now economic weakness is endangering our global power.
Call it the fractal geometry of fiscal crisis. If you fly across the Atlantic on a clear day, you can look down and see the same phenomenon but on four entirely different scales. At one extreme there is tiny Iceland. Then there is little Ireland, followed by medium-size Britain. They’re all a good deal smaller than the mighty United States. But in each case the economic crisis has taken the same form: a massive banking crisis, followed by an equally massive fiscal crisis as the government stepped in to bail out the private financial system.
Size matters, of course. For the smaller countries, the financial losses arising from this crisis are a great deal larger in relation to their gross domestic product than they are for the United States. Yet the stakes are higher in the American case. In the great scheme of things—let’s be frank—it does not matter much if Iceland teeters on the brink of fiscal collapse, or Ireland, for that matter. The locals suffer, but the world goes on much as usual.
But if the United States succumbs to a fiscal crisis, as an increasing number of economic experts fear it may, then the entire balance of global economic power could shift. Military experts talk as if the president’s decision about whether to send an additional 40,000 troops to Afghanistan is a make-or-break moment. In reality, his indecision about the deficit could matter much more for the country’s long-term national security. Call the United States what you like—superpower, hegemon, or empire—but its ability to manage its finances is closely tied to its ability to remain the predominant global military power. Here’s why.
http://www.newsweek.com/id/224694
I read that yesterday and he is just about telling you to short the long bond. If there is one huge Black Swan event left to cap off this capitalist orgy of greed it might just be bond market. I curse the FED, Treasury and especially the Clinton-Obama economic gang of crooks.
If the dollar strengthens due to a renewed round of fear in the global financial markets, wouldn’t short the long bond be a bad position to be in?
“the Clinton-Obama economic gang of crooks”
I’m assuming you mean Clinton through Obama, including the years 2001-2008. If you’re suggesting there wasn’t a “capitalist orgy of greed” facilitated by the Feds during that time frame, you must be smoking something. But of course, you could start the timeline much earlier than that.
MG
start the timeline much earlier than that.
a la Reagan.1982 +/-
You are right, I am much too narrow in my pinpointing the group responsible. But I do strongly fault Obama for bringing back 80% of the Clinton era finance gurus. My big hope was Paul Volker but he’s ignored for the most part.
Fair enough. I’d venture to say that there has been no real distinction between the two major political parties for a very long time when it comes to financial governance.
MG
especially the Clinton-Obama economic gang of crooks ??
I just vomited….
You know, I have no idea why everyone expects us to stay on top as this “empire”. Frankly, there are 200M people in Russia and Japan. Along with 1.2 Billion in India and China.
We are 1/10 the size of those countries put together. We could only “rule” those companies by some stupidly massive militarization of the entire economy.
This is not counting all those other little countries like Brazil, EU, anything in Africa.
We aren’t any good at Empire building anyway…….
-We financed the rebuilding of the economies that are our direct competitors.
-Most of the countries we have “occupied” over the years didn’t have a damn thing worth stealing/fighting over.
-Whenever we “occupy” a country, half the country (usually, the political opposition of the President who made the decision) starts clamoring for us to “get out NOW”
We are now suffering from “Empire Fatigue”. We’ll see how the world likes it when the Chinese start running things.
Of course, we could never occupy a country like China for a long period of time. But no one else has the ability to ‘project’ military power around the globe like we do. Certainly not China, who can barely send a naval ship to sea away from its own shores.
Every period of large-scale international commerce requires a military power capable and willing to literally ‘patrol the seas’. For better or for worse, we’re that power now. No one else comes close, for the time being.
Given all the money and job woes, this downturn must be having a heavy effect on people in terms of stress and medical issues? I was pondering this coming back from visiting my parents. I know I get wound up reading the stories and thinking about things. I can’t imagine it for people with no savings or without a job.
Well, someone jumped in front of a subway train at a stop near mine recently, but there is always a spike in such incidents around the holidays.
Very good point, Va, I think we all have to step away from the computer and any other sources of bad news from time to time and think in terms of solutions. I find the best thing to do is just to keep my head down and keep on plugging away at what I’m doing for a living.
We could all go golfing with Eddie
Now, DD, be nice. Eddie posted his plans for possibly buying a house and in that entire post he didn’t belittle anybody except the BMW guy, who is fair game.
Only if you promise not to point out all the overpriced drivers FBs bought with credit cards. That can be a bit of a downer. And for the love of god, do not stiff the cart girl with the excuse that you’re saving that extra $5 to buy a house with cash.
It sucks, even when you have some savings.
Other than looking for a job, you can’t do a damn thing except stare at the walls, because you are afraid to spend the money.
The way the hiring cycle works in this business, I could easily be out of work thru April. Which means the savings that took me 2-3 years to accumulate will be spent just keeping up on the bills.
At this point, I refuse to move 1500 miles on my own nickel, to take a 50% pay cut…….I can make that working 10 hours/week locally, doing my contract work.
In the end, we are all going to be contractors.
Hang in there, X-GSfixer. We’re pulling for you. Are you a computer engineer?
This is a sad situation to find oneself in, but a nice reminder to others to keep your expenses low.
How about no savings AND no job? Measured in millions?
Dubai official: Dubai World’s debt its own
Dubai finance official says Dubai World not guaranteed by emirate; creditors also at fault
By Barbara Surk, Associated Press Writer
On 9:21 am EST, Monday November 30, 2009
DUBAI, United Arab Emirates (AP) — The heavily indebted Dubai World is not guaranteed by the emirate’s government, a top financial official from the city state said Monday, offering little direction to anxious investors on a day when the United Arab Emirates registered a record fall on the back of Dubai’s debt mess.
On the first day of trading since news of Dubai World’s debt crunch became public, Dubai’s main stock exchange dropped more than 7 percent while the Abu Dhabi exchange fell more than 8 percent — the steepest fall in at least a year, according to brokers.
Driving the financial avalanche was Wednesday’s announcement that conglomerate Dubai World would seek an at least six month reprieve on its $60 billion in debts, obligations amassed during years of a building spree that turned the desert emirate into the Middle Eastern version of Las Vegas, Wall Street and, at times, Sodom and Gomorra, all rolled into one.
If markets were looking for reassurances from Dubai that it would stand behind the conglomerate, they got none Monday.
“Dubai World was established as an independent company, it is true that the government is the owner, but given that the company has various activities and is exposed to various types of risks, the decision, since its establishment, has been that the company is not guaranteed by the (Dubai) government,” Abdulrahman al-Saleh, director general of Dubai’s Finance Department, said on Dubai TV.
“Consequently, the company’s dealing with the various parties has been on this basis,” he said.
Al-Saleh’s comments were the first public remarks by a Dubai official since Thursday, the day after the emirate’s government’s announcement about Dubai World’s request for a debt repayment postponement.
The lack of clarity or direction from the rulers of Dubai since the extent of the conglomerate’s financial ills became known has been a major source of angst for investors.
Earlier this year,(March 2009) Dubai World’s City Center in Las Vegas committments resulted in litigation:
“Dubai World, a conglomerate owned by the government of Dubai, has sued MGM Mirage for breach of contract and blamed it for cost overruns. It also signaled it won’t provide its half of Friday’s payment. MGM Mirage, meanwhile, is struggling to persuade its reluctant lenders to allow it to solely fund the project. While talks between MGM Mirage and Dubai World were ongoing Thursday night, there “may be no choice” but for City Center to file bankruptcy “if Dubai World doesn’t fund,” said a person close to MGM Mirage.
Dubai looked so rich
you see their islands from space
tide went out. NAKED!!!!
Hello everyone,
The wife just sold my gold and platinum coins to APMEX. I made about $300 on both coins. I am going to switch to silver. I hate bubbles and I think gold may be in one. I am still investing in a gold dominated fund, but that’s for the long term.
Glad you made a few bucks!!! Do you know (in %) the premium/commission you paid to both buy and sell the coins above the spot price? I am just interested in what those costs might be to get into and out of physical when dealing with a respected, national broker. Thanks.
Stpn, do get any tax advantages on your financial endeavors due to being in a war zone?
Don’t forget to tell the IRS on your cap gains. Obama is depending on you to fund more socialist programs.
I worked for a telecom manufacturing company during the dot-com boom and bust. All of the employees who were there when the firm first went public got a lot of stock options. I wasn’t one of those. During the last months of 2000 these people were downright giddy over their paper wealth.
While a few cashed out at or near the peak, many others refused to exercise and sell more than just a few of their shares because (honest) they said they didn’t want the big tax bill!
Hello?!! You should WANT a big tax bill!
Now all those options are worthless of course. But they sure saved on taxes!
At one of my previous employers, we were given stock options as part of our comp package.
Later, when the company management changed, we were given the option of cashing out the options at a reduced price vs. option price. We all converted, the RAN to the bank to cash the check.
In the 7 years since, the stock price hasn’t come anywhere CLOSE to the option price (as suspected after the management change).
An option ain’t worth crap until you cash it out.
“Now all those options are worthless of course. But they sure saved on taxes!”
Unless of couse they were hit by AMT and paid tax on the shares that had not yet sold. In which case, they paid far more in taxes than they ever earned on the options.
Most of them never even exercised any of their options, so there was no tax liability.
Congratulations!
Since my precious metals were the biggest gainers in my asset allocation, I’m going to sell of some of my gold in regular intervals starting in January to make up for the 40% higher witholding.
I wish you the best of luck. So far, every time I have sold any gold, I have regretted it.
Another way to do it would be to ride the gold/silver price raises until it starts to fall 5-10 %, then call Apmex. We did just sell a little to pay some back taxes on our office which we’re almost ( she got another delay of 2 weeks, and followed our attorney out to his car, stood in front of it, and wouldn’t allow him to enter it, while shouting invective at him after the hearing ) done foreclosing on. I was very happy with the way Apmex handled our resale. The eagle was repurchased at spot and the bar ( Credit Suisse ) was bought at about $ 8 under spot. Can’t complain.
I should have said, the bar was repurchased at about $8 under spot. Apmex had about a $ 39 buyer’s premium above spot for new purchases, so that would be their spread at the time. I don’t know what it is now, since we’re not buying.
The news articles mentioning this Arizona law professor’s paper on “walking away” were discussed here already. If interested in reading the full article, it can be downloaded here:
“Underwater and Not Walking Away: Shame, Fear and the Social Management of the Housing Crisis”
Brent T. White
University of Arizona - James E. Rogers College of Law
Abstract:
“Despite reports that homeowners are increasingly “walking away” from their mortgages, most homeowners continue to make their payments even when they are significantly underwater. This article suggests that most homeowners choose not to strategically default as a result of two emotional forces: 1) the desire to avoid the shame and guilt of foreclosure; and 2) exaggerated anxiety over foreclosure’s perceived consequences.”
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1494467
“This article suggests that most homeowners choose not to strategiclly default as a result of two emotional forces: 1) the desire to avoid the shame and guilt of foreclosure; and 2) exaggerated anxiety over foreclosures’s percieved consequences.”
If keeping the shame and the guilt and the exaggerated anxiety alive will keep the homebuyer making housepayments then I’m all for it.
If keeping the shame and the guilt and the exaggerated anxiety alive will keep the homebuyer making housepayments then I’m all for it.
Unfortunately, it won’t! It will cause Congress to pour money and benefits on these “ppor victims”.
A deals a deal, and if you made a non-recourse loan, where the house is the only collateral against the loan, then it’s perfectly fair to hand it back to the bank.
It may be perfectly fair and it may even be rational but it still screws the rest of us.
It may be perfectly fair and it may even be rational but it still screws the rest of us.
Only to the extent the government bails out the bank. And if the government does so, under the auspices of “we the people”, then we’re screwing ourselves.
If the buyer mis-represented anything regarding financial information or primary residence to get the loan, then there should be some consequences. At least throw the buyer in prison for a couple of years.
I don’t feel the least bit sorry for the lender who didn’t care to check anything out though. The lender can eat the loss on the property and allow me to purchase for pennies on the dollar.
If keeping the shame and the guilt and the exaggerated anxiety alive…
Funny, I don’t remember “shame”, “guilt” or “anxiety” being mentioned in any real-estate pitch I ever heard.
Yeah that’s great until the rage builds and the portable lead delivery systems start coming out.
Oly — dat u?
Nah - Again, check ATE-UPE’s backyard if you’re looking for OlyGal
Oly would spell ‘geoduck’ correctly.
Horry County sees decline in real estate sales.
Associated Press ~ November 30, 2009
MYRTLE BEACH — Year-over-year sales of real estate plunged by more than 80 percent in one South Carolina county, and the decline forced a local bank to either come up with cash or consider a merger.
The Sun News of Myrtle Beach reported Sunday that in Horry County, the impact of the rise and fall of the real estate market was felt in mid-priced neighborhoods and those with oceanfront condominiums and upscale projects.
While home sales are on target to surpass totals from 2008, which was the worst year in nearly a decade, experts disagree about how long a full recovery will take.
Meanwhile, banks that invested heavily in the local real estate boom now are watching their financial losses mount and attracting more scrutiny from regulators.
I’m still waiting for Ben to post his “2005 retro-news” from California.
In the meantime, I’m learning a lot from the Goebbels diaries. Old Goebbels really was a master of news-propaganda. His 1942-1943 diaries were published in English in 1948: the 1939-1941 diaries in 1983. Both contain gaps due to missing entries.
A complete set recently (1992) turned up in Soviet archives. It will be interesting to see a complete English translation if someone were willing to put in the labor.
The “big lie” theory, knowing when to exaggerate and when not to, when to ignore a story, it’s all here. I wonder whether the NAR took these books to heart.
Yep. They had Goebbles, we had Edward Bernays.
We now live in the era of the most effective pyscho warfare ever created in the history of mankind being used for commercial purposes.
Most people don’t stand a chance.
Wealthy Investors Plan to Buy More Real Estate, Barclays Says
Nov. 30 (Bloomberg) — Individuals with more than $800,000 to invest plan to increase their property holdings because they foresee better long-term returns than from stocks and bonds, according to a Barclays Plc global survey.
Twice as many people plan to raise their investment in commercial and residential property as intend to reduce it, the Barclays Wealth unit said in an e-mailed statement today. The richer the individual, the greater the proportion of wealth is placed in real estate, the survey found.
http://bloomberg.com/apps/news?pid=20603037&sid=aJrdCzCabdOs
The Fed can’t keep the interest rates low forever. What happens when interests rates go up? Yep. Cost of housing goes up. Yep, Real Estate prices plummet.
To me, it’s relative. You can buy a house now with a low interest which means low monthly. But if you live in California, you pay a freaking arm and a leg on property tax. A few friends have to pay 8-9K a year on Prop taxes. That’s another $700 dollars a month. If rates go up, then house prices go down drastically.
“The Fed can’t keep the interest rates low forever.”
Why?
FP, California has one of the lowest property tax rates in the US. Slightly more than 1% of assessed value. If your friends are paying $8000/year, they must have a $800,000 house and can afford such high taxes. And if they bought at the top of the bubble and the house has gone down in value, they can easily get the house reassessed to lower their taxes.
The median price of a house in California has gone down to $280,000, so the median property taxes for new purchases has gone down to $3000.
“The richer the individual, the greater the proportion of wealth is placed in real estate, the survey found.”
Thus we have our model’s:
1. Donald sTrump
2. Robert T. Kiyosaki
3. Lenny Dykstra
4. Brad Pitt
5. Nicolas Cage
6.
7.
“The richer the individual, the greater the proportion of wealth is placed in real estate, the survey found.”
Which is why it should come as no surprise that our government, which is made up of the uber wealthy, is desperate to prop up real estate prices. They’re looking out for their own bottom line.
How would “help from the president” square with BB’s case that the Fed needs to maintain its vaunted independence? I see a conundrum here…
MarketWatch First Take
Nov. 30, 2009, 9:57 a.m. EST · Recommend · Post:
Ben needs Barry
Commentary: Editorials are nice, but Bernanke can only push reform so far
By MarketWatch
NEW YORK (MarketWatch) — Federal Reserve Chairman Ben Bernanke’s impassioned appeal on Monday for Fed independence may be the most concise and compelling case the administration has made for its regulatory reform plan so far.
Too bad, it’s Bernanke making the case alone. He really should have help from the president.
…
I keep wondering if this guy has already been forgotten? I for one certainly hope not.
Fed Governor Edward M. Gramlich
Edward M. Gramlich warned frequently about subprime mortgages and predatory lending, which he said “jeopardize the twin American dreams of owning a home and building wealth.” (By The Urban Institute)
By Patricia Sullivan
Washington Post Staff Writer
Thursday, September 6, 2007
Edward M. Gramlich, 68, a former Federal Reserve governor who unsuccessfully pushed Fed Chairman Alan Greenspan to crack down on irrational lending before the mortgage boom, died of leukemia Sept. 5 at the Washington Home and Community Hospices. He was a Washington resident.
Dr. Gramlich, who served on the Board of Governors of the Federal Reserve System from 1997 to 2005, was surprised this spring by the diagnosis of acute myeloid leukemia, an advanced cancer of the white blood cells. It was his second bout with leukemia. Ever the pragmatic economist, he considered the costs and benefits of an experimental treatment but ultimately rejected it.
In June, Dr. Gramlich published “Subprime Mortgages: America’s Latest Boom and Bust” on a topic that he had warned about for years. Much earlier, as chairman of the Neighborhood Reinvestment Corp., he had urged lawmakers to better protect consumers against predatory lending practices and toughen the regulation of mortgage lenders and banks, calling the mortgage process “confusing, costly and far less than optimal.”
He continued that campaign as a Fed governor; in December 2000, he was among those who wanted to tighten regulation of high-cost home loans long before the current panic set in.
…
He was a good man.
“…Much earlier, as chairman of the Neighborhood Reinvestment Corp., he had urged lawmakers to better protect consumers against predatory lending practices and toughen the regulation of mortgage lenders and banks, calling the mortgage process “confusing, costly and far less than optimal.”
How does one balance “far less than optimal” against Sir Greenissspent’s “Market innovation”?
Oz = 1
Munchkin’s = 0
Recycling centers close, eliminating ‘green’ jobs
Operators are suing the state over its raid on deposit funds, and regional conservation groups have eliminated jobs for at-risk youths.
-Sacramento - Recycling centers across California are closing, and scores of troubled youths are being tossed from “green” jobs onto unemployment rolls in the wake of Sacramento’s raid on bottle deposit funds.
California’s recycling treasury, filled by consumers’ nickel and dime deposits on drink containers, had hummed along successfully for two decades until state officials left it nearly bankrupt after taking $451 million out to help balance the budget.
The unredeemed deposits that subsidized recycling facilities and such projects as a local conservation corps are virtually gone, leaving the programs in the lurch.
Now operators of recycling depots in many supermarket parking lots are suing the state. Without the subsidies, Tomra Pacific Inc., a leading depot company, has closed at least 33 recycling sites — more than 8% of its total, said company president Adrian White.
“Finding a location to recycle is going to get harder,” White said.
– Even if recycling stops, I hope that we’ll continue to separate trash based on type. It’ll help when we’re mining landfills (by hand) to know that when we hit a seam of cans what the approximate overburden ratio will be.
– Just finished my thesis and still have no job, so I watched all of “Crash Course” on youtube. Anybody else seen it?
– In reference to cobaltblue’s “natural born economy killers” comment below, I’ve also only bought a NYTimes (for the Saturday x-word) since Tuesday. A little heat for the apt, some electricity and Netflix is all else really.
MrBubble
Mr. Bubble, Thanks for the reminder. I bookmarked that site long ago - Chris Martenson - and never did navigate back to the proper bookmark. Did try a couple of desultory times, though.
Good luck on the job hunt. What was your thesis topic?
It’s something called paleoaltimetry. Finding out the topography of the past could help to better determine the climates of the contnent, which has import for the future. Thanks for asking! I know that it’s a snoozer.
MrBubble
Hang in there, Bub.
And keep writing, okay? You’ve a lot of thought-provoking ideas in there. I enjoy your posts.
a
For anyone not familiar with CA’s recycling program, you’re charged 5 or 10 cents or so for every bottled beverage that you purchase as the “redemption value”. In order to get your money back you have to save the bottle and redeem it at a recycling center. The catch is centers are few and far between, and even if redeemed, you don’t get all of your money back. So it’s basically a tax on beverages.
The nasty thing is that most places in CA have “curbside” recycling, making the “bottle bill” unnecessary and little more than a tax.
Is libertarian rock star and Texas Republican Ron Paul going mainstream?
He’s got everyone from South Carolina Republican Sen. Jim DeMint to Minnesota moderate Democrat Collin Peterson to California liberal Barbara Boxer on his side in his audit-the-Fed crusade. He’s drawing liberal support in his push to rein in the cost of the war in Afghanistan. Senate candidates like Democratic Rep. Paul Hodes of New Hampshire are finding Dr. No’s populist economic anger to be useful in the campaign, echoing Paul’s criticism of the Federal Reserve.
This convergence of odd bedfellows, and the economic angst that’s driving it all, is yet another signal that President Barack Obama is going to have more and more trouble keeping his traditional Democratic allies on his side as the economic debate continues. It seems that everyone is looking for something new to latch on to in the economic debate — even if those ideas belong to one of the more eccentric members of Congress.
“This brought people together [from] the whole political spectrum, from progressives and liberals and libertarians and conservatives. … they all came together. That, to me, is what is really so important,” said Paul, who has been introducing his audit-the-Fed measure since the early ’80s.
After so many tries, this time Paul’s measure attracted 313 co-sponsors in the House, representing every possible point on the political spectrum. It also scored a strong vote in a key committee and has a companion in the Senate that’s supported by a bipartisan coalition of senators.
And Paul’s economic views, long dismissed by the political establishment, seem to be resonating more broadly than just the audit-the-Fed measure, both in the larger financial reform debate and the growing concern about the cost of continuing the war in Afghanistan.
xxxx
But lawmakers — and, more important, the voters they represent — are starting to believe that the financial meltdown and the dramatic government rescue effort seems to have gotten Wall Street back on its feet quite nicely while leaving regular folks on the curb, analysts say.
“On financial regulation matters, most Americans sympathize with Ron Paul’s outrage,” said Cook Political Report House analyst Dave Wasserman.
Take Rep. Alan Grayson (D-Fla.), a firebrand liberal who infamously declared that the Republican health plan is for people to die instead of to use the health system. Despite being on opposite sides of the political universe from Paul on a wide range of issues, Grayson paired up with Paul to help push the amendment version of the Fed audit bill in the House Financial Services Committee.
The committee victory for the Paul-Grayson amendment came at the defeat of a weaker alternative offered by Rep. Mel Watt (D-N.C.) and backed by Frank. In normal times, the Watt amendment was just the kind of chairman-backed compromise Democrats would usually dutifully embrace. Instead the committee, including more than a dozen Democrats, opted 43-26 for the more intrusive Paul-Grayson measure.
“So far, the Federal Reserve has refused to answer questions about special loans and deals for Wall Street banks. I support an audit of the Federal Reserve to provide answers for working families and to protect New Hampshire taxpayer dollars,” said Hodes, a Democrat who is running for Senate in New Hampshire and backed the Fed measure.
xxxx
But Paul isn’t stopping with the auditing measure. He sees the other financial reform proposals throughout Congress as adding, not subtracting, from the vast Fed powers. And he has allies in the heart of the Democratic Caucus.
Democrats like Peterson and Maryland Rep. Elijah Cummings, along with liberals such as Ohio Reps. Dennis Kucinich and Marcy Kaptur echo concerns shared by Paul that the Fed gains too much power under the financial reform legislation authored by Frank and the Obama administration. Under Frank’s bill on systemic risk, the Fed would be the primary agent of a new council to regulate big, complex “too big to fail” financial firms, a position that would expand the central bank’s current oversight powers.
“Why are we even thinking about giving more power and authority to the Fed?” Peterson, a rural Democrat, asked during a hearing. “It is one of the more unaccountable parts of federal government. Its governance is influenced more on the wishes of major banks and the American people.”
xxxxx
Chavez threatens to nationalize Venezuelan banks.
CARACAS (Reuters) – Venezuelan President Hugo Chavez said on Sunday he could nationalize private banks unless they comply with the law, adding he had “no problem with that because the banks don’t want to extend credit to the poor.”
In a broadcast from nationalized farmland in central Venezuela, he said: “To all the country’s private bankers … (I’m saying) he who slips up loses; I’ll take over the bank, whatever its size.”
“You want me to nationalize the banks?” he said during the broadcast of his weekly TV show “Alo Presidente.”
“I have no problem with that because the banks don’t want to extend credit to the poor, they don’t comply, they don’t want to comply with the bank’s purpose for existence, and that is the law.”
Chavez said the purpose of banks was not to enrich a small group of people but “should be to collect funds and savings to help aid the country’s development by making loans, extending credits for housing.”
In power for a decade, Chavez has nationalized broad swathes of the economy.
His banking nationalization threats on Sunday appeared to be broader in scope than his well-publicized warnings in recent years to nationalize Spanish-owned banks in Venezuela.
He’s a freaking idiot.
He’d better hope their oil reserves hold out. They’ll be the only tangible asset left in the country.
Report: Region’s building pipeline drops 69% in October
Business First of Columbus
A drastic drop in commercial construction contracts sent Central Ohio’s building pipeline to a nearly 70 percent decline in October, according to new data from McGraw-Hill Construction.
The company in its monthly report said contracts for future construction in the region were valued at $127.5 million last month, down 69 percent from $407.4 million a year ago. Commercial building contracts plunged 77 percent to $76.9 million as residential contracts slipped 32 percent to $50.6 million.
At the end of the first 10 months of the year, construction contracts in Central Ohio totaled $1.12 billion, down 48 percent from $2.16 billion a year ago. That accounts for a 62 percent drop in commercial activity at $549.3 million and a comparably mild 18 percent decline in residential contracts at $574.5 million.
What is this?
1. Trial balloons
2. Propaganda
3. In preparation for audit of the FED they will get some stuff off their books. Make their balance sheet look stronger.
The Federal Reserve Bank of New York said Monday that investors and others shouldn’t read anything about the timing of when the central bank will need to reverse course and start boosting interest rates and removing other supports to fend off inflation.
The upcoming operations will involve so-called reverse repurchase agreements. That’s when the Fed sells securities from its portfolio with an agreement to buy them back later.
Reverse repos are one of the tools the Fed can use to drain some of the money it has plowed into the economy to ease financial troubles.
The operations will be “extremely small” and won’t affect the Fed’s key interest rate, officials said. They wouldn’t say what the dollar amount for the operations would total.
Fed officials also said they didn’t know when the first operation would be conducted and how many there would be. The operations will be conducted to “to ensure operational readiness” at the Federal Reserve, the New York Fed said.
They do not “represent any change in the stance of monetary policy, and no inference should be drawn about the timing of any change in the stance of monetary policy in the future,” the New York Fed said.
Reverse repos have been in the Fed’s toolkit for years as a way to mop up money in the economy, and most recently were used in December 2008, the Fed said.
This time around, though, the Fed is considering selling its securities to a broader set of investors — beyond the traditional big “primary” securities dealers such as Banc of America Securities, Citigroup Global Markets and JPMorgan Securities.
Fed Chairman Ben Bernanke has said such large-scale reverse repurchase agreements can be done with banks, Fannie Mae and Freddie Mac and other institutions. Some analysts have said that might involve transactions with money market mutual funds.
To foster the recovery, the Fed earlier this month decided to leave a key bank lending rate at a record low near zero, and pledged to hold it there for an “extended period.” Many economists predict rates will stay at super-low levels through the rest of this year and into part of next year
4. A game of hot potato with bad assets. The Fed will re-repurchase the bad assets after the audit.
I like (4), Al.
It does sound like a possible setup for “window-dressing” the books of any banks that they want to make appear more healthy than they are.
To those unfamiliar with the term, it’s what business or mutual funds do prior to a reporting period, when they want to make their positions look safer than the positions they really held over the period. They buy safe assets, and sell the riskier ones.
In the case of the banks, they could be selling their cr*p to the Fed, and buying Treasuries from the Fed. Both could be structured as repos/reverse-repos so the net effect is nil. But they could make the books looks however they want them to.
Of course, it could also just be a practice run for when they really do need to unwind. They could be just turning the crank, and seeing if things work properly.
The re-purchase agreement has me thinking 3 and 4 are the reason.
Why do I care ,why do I post ? Go ahead everyone take Eddies stance and
just take advantage of the temporary ebb and flow of the Power Brokers
market tricks and illusions .
Why do I care about the BEE HIVE and all the little worker bees that make up the whole ? Why do I not want the Bee Hive to die and be replaced with some hideous version of a functional happy Bee Hive ?
Oh well ,better take the dog for a walk now .
HUH?
This gives you something to think about all day Eddie ,figure out the riddle ,figure out what I mean .
You know how an almost burned out clutch gives you that feeling of “engagement” for just the briefest of a moment…
Keep spinning eddie…you might just “get it”
O.k., serious question for the HHB brain trust:
If (big IF) I stay in Florida, should I go ahead and become a licensed realtor so I can write my own offers? A colleague of mine honeymoons as a realtor, and when we discussed the “market,” today, it was obvious to me that he will be unwilling to lowball they way I plan on lowballing.
You need to find someone who relies on their realtor job to put bread on the table.
I suspect you can submit an offer without being a realtor. I sold my house FSBO with no realtor. Look around and you might find a web site that has the forms. You could ask your friend to review your offer once it is written. You could also find a realty lawyer.
Muggy,
I hold a Ca Agent and Broker’s License- (new). It helps me in my career, and it certainly had helped me search for our home.
You might want to check with your local real estate board, and see if you can just pay to access the MLS. Some offer a tier membership. Other than that, the associations are a waste of $. It might help you connect with the bank’s asset mgrs.
You could also skip the license, and see if you can access the bookstore at the association without getting a license (it varies with location). NoLo Press (do it yourself law firm/bookstore) is online too. Purchase Contracts, laws, and paperwork, and the interpretation of them is a NoLo Press specialty. NoLo is wonderful when it comes to real estate contracts and filling out the paperwork. They update their books annually. They even have tips on negociating , and discuss the tricks and how to outsmart the opposing party.
I’d say yes. Ultimately, he/she can’t refuse (as is law at least in NJ), but my realtor definitely tried twenty times over to convince me to raise my bid on a home I put in this weekend (and she did so in the past too).
But she does make herself available at the drop of a hat, verifies my calcs on various things, and has for some sick reason stuck with me showing me houses for several years now…
You could just be open with a few realtors and say “Hey, this is what I want to do.” If they have an issue, they’re not the person for you.
“A colleague of mine honeymoons as a realtor, and when we discussed the “market,” today, it was obvious to me that he will be unwilling to lowball they way I plan on lowballing.”
All offers must be presented by law. However, if the agent can’t lowball with enthusiasm, they clearly aren’t the right agent for you.
A colleague of mine honeymoons as a realtor…
Just how often does this person get married?
(I’m sure you meant “moonlights”)
A new name for a hooker: Honeymooner.
That reminds me: A guy I know used to be a tour guide for weekend trips to places such as Vegas. At the beginning of the tour he’d make sure he had a straight man ask him:
“As tour guide isn’t your role akin to that of the captain of a ship?”
“Yes,I’d say so.”
“Well then, can you perform marriages on the tour just as a captain can perform marriages on his ship”?
“Why yes, yes I can. But unlike the ship captain’s marriages a tour guide’s marriages are only valid for the length of the tour.”
What I want to know is, why are you all commenting here when you’re supposed to be Cyber-Mondaying the crap out of your credit cards?
Don’t you care about America?
Many, just like me, have discovered we’re natural born economy-killers.
Far beyond rehabilitation, we spend our days trying not to spend money, and making what we do have last longer.
Some of us don’t even turn on the TV some days.
Or go to Starbucks. Ever.
We don’t care who we hurt. We’re incorrigible.
I didn’t even know it was Cyber Monday until I opened my browser.
I got mine!
Got a cheap Need for Speed for $10. The undercover is old. Shift costs $43. Maybe I’ll get it next year.
Got a 30% off deal off another site. Spent $25.
During lunch went out to Ikea and bought a couple of floor lamps and two light bulbs for a total $30.
Lamps Plus typical price for a lamp is $200.
I think I got good deals for needs (and need).
One of the great things about being married is never having to buy presents again. And as an added bonus when the presents are opened “from us” I’m as surprised as the person “we” gave the present to since I have no clue what “we bought”.
The downside of course is that “we” end up buying $450 mixers for “our” sisters.
I’m as surprised as the person “we” gave the present to since I have no clue what “we bought”.
So really, you’re still “buying” presents, you’re just not shopping for them any more.
Everything’s up to date in Dubai City
They gone about as fer as they can go
They went an’ built a skyscraper four hundred stories high
About as high as a buildin’ orta grow.
Everything’s like a dream in Dubai City
It’s better than a magic lantern show.
You can turn the air conditioner on whenever you don’t want heat
With every kind of comfort every house is all complete.
You could walk the privees in the rain and never wet your feet!
They’ve gone about as fer as they can go.
They’ve gone about as fer as they can go!
MarketWatch First Take
Nov. 30, 2009, 11:57 a.m. EST
Everything’s up to date in Dubai City
Commentary: Even the financial dustups are bigger than life
By MarketWatch
LONDON (MarketWatch) — Investors have had a full holiday weekend to digest their turkey dinners — if they live in the U.S. — and the implications of Dubai World’s decision to delay debt payments for six months.
If you’re holding Dubai World debt, the indigestion is getting worse.
Abdulrahman al-Saleh, director general of Dubai’s department of finance reportedly said in a TV interview Monday that “The government is the owner of the company, but since its foundation it was established that the company is not guaranteed by the government.”
…
Slight proposed revision:
You could walk the privees in the
rainsun and neverwetburn your feet!Know a fellow who’s cousin was working over there for a fiber optics/cable company. He left his rented Audi at the airport a few months ago, when his paychecks stopped. According to him there are tons of unfinished projects sitting idle.
That brings to mind the San Diego home building industry. One day they were as busy as a bee; the next day they were slow as a snail.
Mmmm. You’d be surprised at how fast the word comes down that the prime investors check just bounced. Takes just a few hours.
Five British sailors taken hostage in Iran.
Mail Foreign Service ~ 30th November 2009
Five British sailors are being held hostage in Iran after their racing yacht may have inadvertently strayed into Iranian waters.
The Foreign Office confirmed that the Team Pindar racing yacht owned by Sail Bahrain and crewed by five British sailors was detained by the Iranian Navy on November 25.
The yacht is believed to have been on its way to the Dubai-Muscat Offshore Sailing Race which began on November 25 and may have ‘inadvertently’ strayed into Iranian waters.
The five crew members are still in Iran and are understood to be safe and well and their families have been informed, the statement added.
Foreign Office officials “immediately contacted the Iranian authorities in London and in Tehran on the evening of 25 November, both to seek clarification and to try and resolve the matter swiftly,” Foreign Secretary David Miliband said today.
‘Our ambassador in Tehran has raised the issue with the Iranian Foreign Ministry and we have discussed the matter with the Iranian Embassy in London.
However, fears were growing that the detention of the British sailors will dramatically increase tensions between Iran and the West.
Like those US “hikers” that are still cooling their heels in some Iranian prison.
Can someone tell me why someone would feel the need to hike/boat ANYWHERE NEAR Iran? It just seems like the benefits are miniscule, vs. the downside of running the risk of being grabbed by the Revolutionary Guard?
I’m wondering if the “hikers” aren’t actually “spies” (as the Iranians say). Or do we actually have people that stupid around here?
Or do we actually have people that stupid around here?
I’m reading “Over the Edge: Death in Grand Canyon” Yes, we do have people that stupid around here!
If you don’t believe people are that stupid ask the Sheriffs dept in any area where there are mountains, deserts, lakes, rivers or anyother places where people can conceivably venture into unprepared.
It boggles the mind.
Truth.
I can tell you that someone I know very well, during the Desert Storm/ Gulf War Operations, had the interesting assignment of flying a C-141 Starlifter JUST outside and paralleling the Iranian coastline border, day after day. Now, a C-141 is a cargo aircraft and has no offensive weaponry. Just like hikers and sailboats are not offensive weapons.
What was the purpose of having a cargo aircraft make repeated runs along the Iranian border in the Persian Gulf?
Some might say answer that question, and you get closer to understanding what the hikers and sailboaters might have been doing and thinking, and for whom…
Now, a C-141 is a cargo aircraft and has no offensive weaponry.
How do special OP’s get to point “A”…F-35 Raptor?
F-35 is still in development..maybe in another 5 years??
F-35 is in production. First rollouts still classified.
Watch how fast this get resolved, imho
My thinking: They captured UK sailors, the UK has a better Navy than Iran, Iran stands about x2 the chance of Argentina (provided Iran can export oil with a UK military presence outside the export harbors)..
Binion’s to close hotel tower, lay off 100 workers.
A spokesperson for Binion’s Gambling Hall & Hotel in downtown Las Vegas says the property will close its 365-room hotel tower on December 14 and lay off about 100 workers.
The property will also close the Binion’s Original Coffee Shop and discontinue keno.
The closing is said to be a result of the continued downturn in the economy.
The casino, sports book, poker room, casino floor cafes, and Binion’s Ranch Steakhouse on the 24th floor of the hotel will remain open.
Very interesting, I guess the hotel rooms are just going to collect dust now. I wish it was a different hotel/casino that was hurting, I hate to see the older ones bite the dust.
Fecaltime!
I agree, I enjoyed LV back in the day, before they started building the Megaresorts. You felt like you were really in Sin City and that was part of the allure. Seedy, sure.
For a while they even tried to promote LV as family friendly, how wrong is that? I saw parents dragging their kids along the strip while the hucksters handed them topless cards. Just wierd.
The Megaresorts vaguely had the McMansion feel about them.
It will be interesting to see what happens to LV over the next ten years or so, but my guess is its glory days are over.
You mean Binion’s Horseshoe? corner of Fremont and Casino Ctr?
Ev’rywhere I hear the sound of marching, charging feet, boy
‘Cause summer’s here and the time is right for fighting in the street, boy
But what can a poor boy do
Except to sing for a rock ‘n’ roll band
‘Cause in sleepy London town
There’s just no place for a street fighting man
No
Hey! Think the time is right for a palace revolution
But where I live the game to play is compromise solution
Well, then what can a poor boy do
Except to sing for a rock ‘n’ roll band
‘Cause in sleepy London town
There’s no place for a street fighting man
No
Hey! Said my name is called disturbance
I’ll shout and scream, I’ll kill the king, I’ll rail at all his servants
Well, what can a poor boy do
Except to sing for a rock ‘n’ roll band
‘Cause in sleepy London town
There’s no place for a street fighting man
No
A long time ago, I sent senator Boxer an e-mail asking that she not vote for the extension of the 8,000 tax credit to house buyers, because it fundamentally just props up the price of houses. (yea right, like i was going to sway her opinion anyway).
Today I got a form letter reply confirming that it passed (we all know that, of course).
The interesting thing is that the form letter also said this:
P.L.111-92 [Public Law] also gives a $6,500 credit to homebuyers who have been in their current residence for the last five years or more.
What? I never heard about this! So now, we’re ignoring renters again and we’re paying all homeowners who have been in their house for longer than 5 years a freebie payment of $6,500!??! WTF?? This is absolutely ridiculous and way out of control. This G.D. administration is in total denial and acting like a drunk. We Californians have got to get rid of Boxer and Feinstein - they are way over the top extremists.
Good luck at getting the extremists out of office in Kaleeforneea.
You’re saying it just gives it to them even if there is no mortgage or anything? Free money?
Well I’ll be dipped.
I thought this was just an extension of unemployment benefits.
“So now, we’re ignoring renters again and we’re paying all homeowners who have been in their house for longer than 5 years a freebie payment of $6,500!??!”
No, this is only if they trade-up to another (new or existing) house. It’s just like the First-time Home Buyer credit, except that you don’t have to be “first-time” anymore. You still have to buy to qualify.
P.L.111-92 [Public Law] also gives a $6,500 credit to homebuyers who have been in their current residence for the last five years or more…
Another dart in the heart of “homerenters” & “passbooksavers”
“California, Uber Ales
Uber ales, Cali-fornia!”
The DK’s strike again!
Pension tension on the rise.
Underfunded retirement plans are shaping up as a headache for companies and taxpayers alike.
NEW YORK (Fortune) — Retirement plans are on the mend, but the healing process is going to be long and painful.
In addition to taking a big chunk out of individuals’ 401(k)s, last fall’s market meltdown left 92% of corporate pension plans underfunded at year’s end, according to a study by investment consultant Wilshire Associates.
As bad as that sounds, it pales in comparison to the shortfalls in public pension plans. At the end of 2006, public pension plans were already underfunded by $361 billion, according to the Pew Charitable Trusts. That was before the stock market collapse, soaring unemployment rates and tumbling tax revenues dealt municipal finances another blow.
The federal insurer of corporate pensions, the Pension Benefit Guaranty Corp., reported this month that it was $22 billion in the red in the most recent fiscal year. The PBGC takes over pensions when they are underfunded or when their sponsors go into bankruptcy, and makes up some of the payments due.
While the bounce in the stock market this year has helped the situation, observers say more pain is ahead.
Strapped municipalities will face pressure to cut back on promised benefits. Hard-hit companies will be forced to choose whether to invest in their businesses or to beef up their pension plans.
“The federal insurer of corporate pensions, the Pension Benefit Guaranty Corp., reported this month that it was $22 billion in the red in the most recent fiscal year. The PBGC takes over pensions when they are underfunded or when their sponsors go into bankruptcy, and makes up some of the payments due.”
Federal thingy-ma-bobs always seem to wind up “deeply in the red” by a couple dozen billion dollars, give or take a half trillion.
Yet, some wonder why there is such opposition to notions like “the Government should take over healthcare” or “the Government would do a better job with that”.
Remind me again who had to bail out who?
benefits cut = less spending and investing = deflationary
I have a big beef about the Government allowing Corporations to underfund their pension plans and not pay enough into the PBGC . Just one more Corporation supplement thats a Government backed
bail out that the taxpayers pay for ,when Corporations should of paid for it .The Banks didn’t pay enough into FDIC during their biggest profit making periods either ,so who has to fill in but the taxpayer .
This has got to stop that Wall Street/Banks/and Corporations get these welfare programs while profits go into to the hands of the
few by these stacked deck .Welfare is suppose to be for the
poor isn’t it ,not a way of giving bigger profit margins to the Greed
Machine . Same with illegal immigrants ,the government supplements business by paying for their health care .
We just gave our public employee pension here $100 million a couple years ago, when things were going good. Arghh.
That is the silver lining for me in this whole meltdown. Finally, states like mine (Ca) will be forced to cut out-of-control pensions. That is the only thing that will allow us to eventually balance our budget.
“…Strapped municipalities will face pressure to cut back on promised benefits.”
Police Officers = hero = cult
Firemen = hero = cult
Prison guards = unseen-hero = cult
City worker = semi-hero= cult
County worker = less-than-semi-hero = cult
State worker = special-less-than-semi-hero = cult
Federal worker = National hero = cult
There seems to be a CULTure of giving EXTRAordinary compensation to people who are hired by their CITIZENS to do what is basically an HOURLY JOB.
A welder has a long ways to go welding a bridge or sky-scraper or aircraft-carrier, or kids bicycle to ever hope of being given CULT status
Run Hwy,…RUN!
Amen, Hwy!
But then, 95% of the people in this county are on the public dole in one form or another.
I’ll keep on workin’, I won’t retire.
Keepin’ the cash flowin’, is all I desire.
Ah, love, and the Goldman connection. Gotta keep that D.C. umbilical cord attached.
Chelsea Clinton Engaged to Longtime Boyfriend.
NEW YORK — Chelsea Clinton, the 29-year old daughter of former President Bill Clinton and Secretary of State Hillary Rodham Clinton, has become engaged to her longtime boyfriend, investment banker Marc Mezvinsky.
Mezvinsky is a son of former Pennsylvania Rep. Marjorie Margolies-Mezvinsky and former Iowa Rep. Ed Mezvinsky, longtime friends of the Clintons. Ed Mezvinsky was released from federal prison last year after pleading guilty in 2002 to charges of bank and wire fraud.
The couple became friends as teenagers in Washington and both attended Stanford University. They now live in New York, where Mezvinsky works at Goldman Sachs.
Ed Mezvinsky was released from federal prison last year after pleading guilty in 2002 to charges of bank and wire fraud.
“Your dad was impeached.”
“Yeah, so what? Your dad went to jail”
“Hey, wanna get married?”
I wonder if she ever went to visit him in the slam.
Triple M (as she is affectionately known in these parts) was a one-and-done congresscritter. Her vote was needed to enact Clinton’s tax hike, she resisted until the WH twisted her arm into doing the deed. I hope the afterglow left her some memories to live on, ’cause when election time came -
District to Mezvinsky: you are the weakest link, good-bye.
Investment Bankers = The US Royals
Now, let’s get all that inbreeding started……..
It would be funny if it weren’t true.
What’s the old joke? “I’d rather be lucky than good although I’d rather be on the inside than lucky.”
Too funny.
You are hilarious, lavi! I love it.
Well, think about it, they have better video capture technology & numerous internet place to up upload really fast…something lacking to their parents. They’ve both gone to Standford…like they have any excuse not be infamous.
(Hwy notes one of the basic concepts of genetics is: Like begets like)
“No warning can save a people determined to grow suddenly rich.”
-Samuel Jones Loyd, (1796-1883) 1st Baron Overstone, British banker and politician. One of the best-known authorities of his time on matters of finance.
Overstone, what a great name.
Overstone, what a great name.
Overstoned.
Brought low.
For “Tigress” on his latest career move, re his own tourny…
Lou Reed
We who have so much to you who have so little
to you who don’t have anything at all
We who have so much more than any one man does need
and you who don’t have anything at all, ah
Does anybody need another million dollar movie
does anybody need another million dollar star
Does anybody need to be told over and over
spitting in the wind comes back at you twice as hard
Strawman, going straight to the devil
strawman, going straight to hell
Strawman, going straight to the devil
Strawman
strawman
Strawman
strawman, yes
Does anyone really need a billion dollar rocket
does anyone need a 60,000 dollars car
Does anyone need another president
or the sins of Swaggart parts 6, 7, 8 and 9, ah
Does anyone need yet another politician
caught with his pants down and money sticking in his hole
Does anyone need another racist preacher
spittin’ in the wind can only do you harm, ooohhh
Strawman, going straight to the devil
strawman, going straight to hell
Strawman, going straight to the devil
Strawman
strawman
Strawman
strawman
Does anyone need another faulty shuttle
blasting off to the moon, Venus or Mars
Does anybody need another self-righteous rock singer
whose nose he says has led him straight to God
Does anyone need yet another blank skyscraper
if you’re like me I’m sure a minor miracle will do
A flaming sword or maybe a gold ark floating up the Hudson
when you spit in the wind it comes right back at you
Strawman, going straight to the devil
Strawman, going straight to hell
Strawman, going to the devil
Strawman, strawman
strawman, …., ah
Strawman
strawman
Cummins To Lay Off At Least 400 Employees.
BUSTI - On Monday, Cummins Engine announced it will be laying off at least 400 employees at the start of the year because of decreased demand.
Mark Land, Cummins Engine corporate communications executive director, said the company has filed a New York State Workers Adjustment and Retraining Notification, which requires employers to provide 90 days notice prior to a plant closing, mass layoff or relocation occurring on or after Feb. 1.
Land said the company will layoff between 400 and 450 employees come January. Land said because of new emission standards being enacted in January the company expects to go from making 500 engines a day right now to only 100 a day. However, he said once Cummins customers need more engines toward the second half of 2010, he expects most of the employees to be called back to work.
“We’ve Seen the Bottom,” Blue Nile CEO Diane Irvine Says
“We’ve seen the bottom” in U.S. consumer spending and confidence, says Diane Irvine, president and CEO of Blue Nile.
Other retail executives may not share her optimism (at least not so openly) but Irvine spoke to Tech Ticker after Blue Nile notched the best Thanksgiving weekend in the company’s 10-year history. The online diamond and fine jewelry retailer is predicting double-digit growth this holiday season, something few retailers can dare dream about.
Keep hope alive. Keep the money flowing.
Buy our extremely expensive diamonds….pleeezeee.
Just wondering.. Is this our same olygal:
http://www.plentyoffish.com/member9401424.htm
Can anyone figure out where she went if that is her?
Interesting but i thought she said on her birthday she was 36. And she always made fun of her religious upbringing. So being dedicated to jeebus means close but no cigar.
I dunno. Perhaps she was just joking about Mormons. It sure seems like here writing style, if you ask me.
Our Olygal is originally from Utah (Utarh, she calls it.) And she never talks about God. I miss her and hope she’s ok.
Is anyone bothering to account for the cost to “taxpayers” of reducing mortgage rates for some especially privileged households down to 2% for the next five years? I will pencil out a rough estimate here: Suppose the interest rate on a $500,000 home mortgage was previously 6% and it gets reduced to 2%. The rough cost to taxpayers of such a rate reduction over a five year period is 4% * $500,000 * 5 yrs = $100,000. That sure beats the relatively meager $8000 new home buyer tax credit by a long shot! At an average forbearance cost of $100,000, the number of modifications that could be funded out of $75 bn would be $75,000,000,000 / $100,000 = 750,000. (I have no idea what the true average forbearance cost will be; just trying to give an illustrative example of calculations here).
US Treasury in foreclosure fines
A house in the US undergoing foreclosure
The mortgage assistance programme is costing the US government $75bn
The US Treasury Department is cracking down on mortgage companies failing to help borrowers at risk of foreclosure.
The Treasury hopes the move will increase participation in its mortgage assistance program, which aims to lower mortgage payments.
Mortgage providers must now submit details on how they would decide which loans would be permanently modified.
Banks that fall short of their agreement could face fines or sanctions.
Under the $75bn (£45.6bn) programme, companies that agree to reduce payments receive several thousand dollars in incentives when the loan is permanently lowered.
However, some mortgage companies say they have had trouble getting borrowers to return their documents so they can complete the changes.
Under the scheme, troubled homeowners could have their mortgage interest rate reduced to as low as 2% for five years.
…
You’d think this would be all over Fox News by now.
Perhaps their ‘analysts’ have not yet figured out how the eye-poppingly high value of FB forbearance benefits?
“You’d think this would be all over Fox News by now.”
Newp. Only topics that require a 9th grade education or lower ever make it to FauxNoise.
HOPE
CHANGE
CHANGE
HOPE
CHANGE
HOPE
How’s that working out for everyone?
Better than “Mission Accomplished.”
+1zillion.
“Under the scheme, troubled homeowners could have their mortgage interest rate reduced to as low as 2% for five years.”
This will encourage FBs to stay the course, to stay in their houses and keep up with their house payments, which is a GOOD THING.
It’s BETTER FOR THE TAXPAYERS if FBs can be convinced to keep the houses rather than have them go back to the banks.
- Don’t the banks have to eventually try to sell homes that they take back?
- What does your comparison assume about taxpayer payments to banks (if they take houses back) versus to households (if workouts enable them to stay in their homes)?
“-Don’t the banks have to eventually try to sell homes that they take back?”
Yes, that’s why it’s a good thing if they don’t have to take them back in the first place.
“-What does your comparison assume about taxpayer payments to banks (if they take houses back) versus to households (if workouts enable them to stay in their homes)?”
If households think they can hang onto their homes then they will take good care of them. If they think their homes will go back to the bank then they will let them go to pot.
Also, unoccupied REOs deteriorate much more rapidly than occupied dwellings, thus they lose their value much faster.
Plus, unoccupied REOs tend to bring down neighborhood values futhur hurting the banks that hold the mortgages for these neighboring houses.
You’ve brought up something interesting, combotechie. Before the bank bailout, the HBB concensus was to let everything crash and burn. Now that we as taxpayers have a stake in the banks’ ability to repay us, we must be ambivalent. Or to put it another way, we’re in a no-win situation: either the FBs get to keep their houses and we’re screwed out of low prices or they lose them and we’re screwed as taxpayers. What do you vote for? I vote for the former.
I think we’ll end up with lower prices eventually. I just want them to to be lowered in an orderly manner.
A crash will destroy confidence and trust in the system and will cause the system to freeze up; The failure of Lehman last year gave us a hint of just what a crash might look like.
An orderly price retreat - a mirror image of the price run-up - is what I would like to see happen. It took up years to get in the mess we are in, I expect it to take years to get back to a point of rationality.
Meanwhile this transition to rationality needs to be funded. I vote for having burden of this funding being placed on those who got us into this mess, not on the taxpayers.
Unfortunately the banks get to skate; It seems we have no choice but to save them.
But as for the FBs … well, they signed the loan documents, not I.
“It is easy to get lost in what you don’t have, It is easy to despair about what you once had. The trick to getting through the hard times, he said, is to remember what you do have”.
Old Coon hunter said this in news now.
I met a traveller from an antique land
Who said: “Two vast and trunkless legs of stone
Stand in the desert. Near them on the sand,
Half sunk, a shattered visage lies, whose frown
And wrinkled lip and sneer of cold command
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed.
And on the pedestal these words appear:
`My name is Ozymandias, King of Kings:
Look on my works, ye mighty, and despair!’
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare,
The lone and level sands stretch far away”.
–Percy Bysshe Shelley–
Amotz Asa-El’s View from Jerusalem
Nov. 30, 2009, 8:49 a.m. EST
Dubai crisis is the Arab economy’s opportunity
View all Amotz Asa-El’s View from Jerusalem ›
By Amotz Asa-El
JERUSALEM (MarketWatch) — What began as a pharaonic construction site is suddenly sinking in economic quicksand, its future as an archeological attraction possibly more promising than its pretensions as a global financial center.
Dubai, which until last week loomed tall - literally - as an enterprising, cosmopolitan, glitzy and happy antithesis to the Middle East’s economic stagnation, has now emerged as a sad monument to all that is ill about the pan-Arab economy, which includes more than a quarter-billion people but is smaller than Spain’s.
Once the dust settles over Dubai World’s debt-default announcement last week, its many Western victims would do well to probe not only the way the emirate’s authorities treated their money but also the relationship between the entire petrodollar elite and the pan-Arab economy.
The Dubai crisis originated in a brave dream: that the Gulf’s oil riches would buy rather than produce a great financial center.
Had this transpired, it would have defied historical precedent, whereby the great modern financial centers — from London, Frankfurt and New York to Tokyo, Hong Kong and Singapore — both followed and fed monumental industrial revolutions.
Those financial centers rose after millions had moved from the countryside to factories, where the process of their economic empowerment began, eventually giving rise to the broad, educated, affluent and socially mobile middle classes that are the backbone of healthy economies.
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“Ozymandias”
Is there a better poster child for that poem on the planet than Dubai City? If so, please share…
“Gulf’s oil riches”
“Oil, it does a kingdom good!”
O.K., I was inspired by the “milk” commercial
I wonder how much of the desert they could have reclaimed with that much investment?
Instead, they piled sand on top of more sand.
(and people thought this was a great investment?!)
Dubai rejects debt guarantee
By Simeon Kerr in Dubai, Andrew England in Abu Dhabi, and Frances Williams in Geneva
Published: November 30 2009 06:50 | Last updated: November 30 2009 22:52
Dubai’s government will not guarantee the debts of Dubai World, the state-owned holding company struggling under the weight of $59bn in liabilities, arguing that lenders were mistaken to think that there was sovereign backing.
Abdulrahman al-Saleh, department of finance chief, said creditors were responsible for their own lending decisions and should differentiate between companies and the state.
“Creditors need to take part of the responsibility for their decision to lend to the companies. They think Dubai World is part of the government, which is not correct,” Mr Saleh said.
Mr Saleh’s comments underscored the government’s intention to cut Dubai World adrift and raised questions over whether it would distance itself from other parts of the emirate’s commercial empire.
Dubai World on Monday night unveiled details of how a restructuring of its debt might proceed.
“The total value of debt carried by the companies subject to the restructuring process amounts to approximately $26bn, of which approximately $6bn relates to the Nakheel sukuk [Islamic bonds from the property arm],” a company statement said.
“Initial discussions have commenced with the banks of Dubai World and are proceeding on a constructive basis,” it said. The efforts would not include other firms, which it said were financially stable, such as Infinity World Holding, Istithmar World and Ports Free Zone World, which includes DP World , Economic Zones World, P&O Ferries and Jebel Ali Free Zone, or JAFZA.
In a note to clients, RBC Capital Markets said Dubai World bondholders had “almost no legal legs to stand on” to recover the value of their investments from the government in the event of a default.
“We now have to look at each Dubai entity on its own merits and cash flows,” said one other banker. “The mood is really crummy, and it’s not just Dubai government risk, we have to be worried about healthy corporates with exposure to companies like Nakheel [Dubai World’s property arm] too.”
Dubai’s move came amid the first signs of regional contagion as the Egyptian stock exchange fell almost 8 per cent, replicating a battering taken by the United Arab Emirates’ bourses.
Rachid Mohamed Rachid, Egypt’s trade and industry minister, warned that “the Dubai situation will have serious consequences for the region”.
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EDITOR’S CHOICE
Dubai cast adrift as credibility crumbles - Nov-30
Lex: Dubai - Nov-30
Opinion: This is not the end of the road for Dubai - Nov-30
Investors tear up old rules on behaviour - Nov-30
Signs of contagion as Egypt’s stocks suffer - Nov-30
Anger within emirate levelled at leadership - Nov-30
“They think Dubai World is part of the government, which is not correct.”
Can anyone offer comment on that statement? I am inclined to believe it may have importance reaching far beyond the Middle East.
“They think Lehman Bros. is part of the government, which is not correct.”
Does this help?
A little. But I am still confused over how you figure out which Megabank is part of the government and which is not.
Compare campaign contributions?
Well first off, you have it backwards.
It’s not “which Megabank is part of the government,” but “which government is part of the Megabank.”
Send Giethner, Bernake and Summers to middle east to learn about free market.
Abdulrahman al-Saleh for treasury sec.
“…arguing that lenders were mistaken to think that there was sovereign backing.”
You know what they say about making assumptions, don’t you?
Still, it wouldn’t be at all surprising if there were countless “verbal” assurances along the way. Trust, but verify.
Investors tear up old rules on behaviour
By David Oakley in London
Published: November 30 2009 18:39 | Last updated: November 30 2009 18:44
Greece, Ireland and Hungary – with what are seen to be dangerously high and rising debt levels – have been among the countries hit hardest by the Dubai debt scare as investors have punished their markets amid fears of contagion.
But, significantly, the old rules of selling emerging market assets and buying traditionally safer developed world markets in times of crisis have been turned upside down following last week’s debt standstill in the Gulf emirate.
Emerging market bonds from China and Brazil have seen inflows as investors treat them as havens because of their healthier public finances, while the Greek and Irish debt markets have been sold off.
This, more than anything, underlines the changing dynamics of the global economy as risks of high debt in the industrialised world have become one of the biggest concerns for investors.
Many emerging market economies, because of their low debt levels and prudent economic management, are perceived to have weathered the financial crisis far more effectively than their rich-nation peers.
Government gross debtFor example, Greek and Irish debt-to-gross domestic product is forecast to rise to 111 per cent and 80 per cent respectively next year. By contrast, Chinese and Brazilian debt-to-GDP are forecast to stabilise at 46 per cent and 65 per cent respectively.
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Kakistocracy (plural kakistocracies)
1. “Government under the control of a nation’s worst or least-qualified citizens”.
~ Yep. I’d say that’s pretty much what we have at this point in time.
How do you propose to fix this?
Hey — I have a great idea: Why not compensate govt employees with the same sized bonuses as Wall Street managers receive?
Heck Pbear, we already have the best government money can buy!
And probably the best Wall Street bank managers as well?
I have no proposal to ‘fix’ it. It can’t be, it has to fail completely, and then be rebuilt.
wmbz: “Government under the control of a nation’s worst or least-qualified citizens”…”Yep. I’d say that’s pretty much what we have at this point in time.”
You’ve just disparaged about 60 million college educated people in America, However, statistically speaking, not that many from South Carolina.
Good thing the recessions over.
Nevada leads nation in rate of bankruptcy filings.
Sun ~ Nov. 30, 2009
Two reports issued Thanksgiving week illustrated the U.S. recession’s devastating affect on Nevada.
The Administrative Office of the U.S. Courts reported that nationwide, bankruptcies for the fiscal year ended Sept. 30 surged 34.5 percent to 1.4 million — with Nevada posting the highest rate in the nation.
Nevada led the nation in filings for the year with a rate of 10.49 per 1,000 people, well above the national rate of 4.52 filings per 1,000 people.
In 2008, Nevada was No. 2 in the nation with a filing rate of 6.39 per 1,000 people and the national rate was 3.38 filings per 1,000 population.
In Nevada in the 2009 fiscal year, bankruptcy filings totaled 27,560 — up 64.5 percent from 2008.
The numbers are in line with the state’s unemployment rate of 13 percent, which has soared from 7.7 percent one year ago as the recession reduced travel to Las Vegas and dramatically slowed the state’s construction and development industries.
Of the 27,560 Nevada bankruptcy filings, 881 were business filings and 26,679 were personal filings. The personal filings were dominated by 19,255 Chapter 7 liquidations.
Who’d have thunk it? With no govt bailouts available, Dubai World is working on privately restructuring its debt. I don’t guess the banks on the lending side of this equation will be looking forward to reaping anything like the bonus pork enjoyed by managers of Wall Street’s TARP beneficiaries.
* NOVEMBER 30, 2009, 4:16 P.M. ET
AT A GLANCE: Dubai World: In Constructive Talks With Banks
THE EVENT: State-controlled Dubai World, which last week requested to delay debt payments, said it is in constructive talks with banks to restructure about $26 billion in debt. About $6 billion of that debt is related to the Islamic bonds issued by subsidiary Nakheel.
Dubai World said its restructuring will comprise several phases, and that it is considering alternatives to its debt obligations.
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Dumb question of the day: How come the UAE don’t need a TARP to shield dead beats from their financial folly?
Won’t that be like putting money from the left pocket into the right pocket? Another thing the a-rabs don’t give a hoot about anybody else. This might work out for their advantage having taken money from the masses toward construction complexes they own. Just my two cents
Black swan guano bomb nails Nobel Laureate’s head…
* REVIEW & OUTLOOK
* DECEMBER 1, 2009
Systemic Risk and Fannie Mae
The education of Joe Stiglitz and Peter Orszag.
As Congress lumbers toward creating a systemic-risk regulator, it’s worth a look back—to 2002, when an economist named Stiglitz and a duo named Orszag wrote a paper with the droll title, “Implications of the New Fannie Mae and Freddie Mac Risk-Based Capital Standard.”
We won’t keep you in suspense. The paper, written the year after Joseph Stiglitz won the Nobel Prize for economics, concludes that “on the basis of historical experience, the risk to the government from a potential default on GSE debt is effectively zero.” Their analysis has recently been making the rounds on the Web to a chorus of chortles.
But the real lesson of the paper is not that Mr. Stiglitz, or Peter Orszag, the current White House budget director, and his brother Jonathan are dupes or rubes. The paper is notable because it represents the almost universally held view of the two government-sponsored mortgage giants at the time and for years afterward.
These pages began writing about the systemic risk posed by Fannie and Freddie at around the same time, but until the very end we were in the distinct minority. Fan and Fred’s own regulator assured the world that they were well-capitalized almost until they were put into conservatorship in September 2008.
The Stiglitz-Orszag paper’s method was to put the companies through “millions of potential future scenarios,” and then to judge the likelihood of default. The assumptions in the test were said to be “severe.” Even so, the probability of a default was found to be “so small that it is difficult to detect.” Some $111 billion in taxpayer-funded bailouts later, with perhaps hundreds of billions to go, the risks have been detected.
…
“Black swan guano bomb”
LMFAO. I’ve had a very long day. thanks for making me LMFAO.
Seriously, where can I get job that pays VERY well and I can be wrong all the time?
The answer ought to be obvious by now:
Become an economic forecaster.
Got that right!
Here is an article that fits a major interest of mine: The Economics of Mendacity
* OPINION EUROPE
* NOVEMBER 30, 2009, 5:07 P.M. ET
The Economics of Climate Change
The stakes are too high to treat Climategate as just another academic spat.
The emails and documents leaked last week from some of the world’s leading climatologists offer a rich trove of evidence that scientists were massaging the data and corrupting the scientific process to support their own preconceptions. But they also offer the beginnings of an explanation for why. In the words of another famous leaker, follow the money.
On its Web site, the University of East Anglia’s Climate Research Unit describes how it could barely make ends meet for most of the years since it was founded in 1972, and how most researchers weren’t even guaranteed salaries in the early years. “Since 1994, the situation has improved,” CRU writes. Why 1994? That was the year the U.N.’s climate change convention came into force. Since then, it has been boom times for those lucky enough to have gotten in on the ground floor of a growth industry powered by grants from governments eager to understand just how quickly we were overheating the planet.
In the 1990s, CRU director Phil Jones helped bring in £1.9 million ($3.1 million) for climate research. But in this decade, according to one of the leaked documents, the total shot up to £11.8 million, including grants from the U.K. National Environmental Research Council, the U.S. Department of Energy and NATO. Another leaked spreadsheet for CRU researcher Tim Osborn shows a similar pattern. Between 1994 and 2000, Mr. Osborn secured research contracts totaling £173,881. Between 2001 and 2007, the last year covered by the file, his haul jumped to £764,055.
Or consider the cash that Michael Mann—another climate establishment figure whose name comes up frequently in the leaked emails—has helped pulled for Penn State University. In 2000, before Mr. Mann joined the faculty, the university banked $20.4 million in research funding for environmental sciences. By 2007, two years after he came on board, Penn State counted more than $55 million a year for environmental research, much of it government funded.
To keep this money flowing, climate scientists needed to keep the fear going. Anything that called into question their most dire predictions of climate catastrophe would put all that funding at risk. On the other hand, the bigger the climate calamity, the more willing governments became to fund global-warming research. Keeping the dissenters on the outside was not simply a matter of academic jealousy. It was in many cases a question of professional survival.
…
* OPINION: GLOBAL VIEW
* NOVEMBER 30, 2009, 7:43 P.M. ET
Climategate: Follow the Money
Climate change researchers must believe in the reality of global warming just as a priest must believe in the existence of God.
* By BRET STEPHENS
Last year, ExxonMobil donated $7 million to a grab-bag of public policy institutes, including the Aspen Institute, the Asia Society and Transparency International. It also gave a combined $125,000 to the Heritage Institute and the National Center for Policy Analysis, two conservative think tanks that have offered dissenting views on what until recently was called—without irony—the climate change “consensus.”
To read some of the press accounts of these gifts—amounting to about 0.0027% of Exxon’s 2008 profits of $45 billion—you might think you’d hit upon the scandal of the age. But thanks to what now goes by the name of climategate, it turns out the real scandal lies elsewhere.
Climategate, as readers of these pages know, concerns some of the world’s leading climate scientists working in tandem to block freedom of information requests, blackball dissenting scientists, manipulate the peer-review process, and obscure, destroy or massage inconvenient temperature data—facts that were laid bare by last week’s disclosure of thousands of emails from the University of East Anglia’s Climate Research Unit, or CRU.
But the deeper question is why the scientists behaved this way to begin with, especially since the science behind man-made global warming is said to be firmly settled. To answer the question, it helps to turn the alarmists’ follow-the-money methods right back at them.
Consider the case of Phil Jones, the director of the CRU and the man at the heart of climategate. According to one of the documents hacked from his center, between 2000 and 2006 Mr. Jones was the recipient (or co-recipient) of some $19 million worth of research grants, a sixfold increase over what he’d been awarded in the 1990s.
View Full Image
Associated Press
Al Gore wins the 2007 Nobel Peace Prize: Doing well by doing good?
Why did the money pour in so quickly? Because the climate alarm kept ringing so loudly: The louder the alarm, the greater the sums. And who better to ring it than people like Mr. Jones, one of its likeliest beneficiaries?
…
Is this a surprise to anyone? The warmenists have been running the same racket as the Rapture/End times fanatics for quite some time now. In the latter case, the funding comes mainly through sales of books and tapes, not government grants.
I truly hope the Wall Street Journal is correct that climate change is a big nothing. How’s their track record on predicting other recent bubbles/hoaxes?
Or maybe they recognize the fact that Exxon and others are funding fake science, and propaganda, just as the tobacco companies did when science proved the link between smoking and cancer. Maybe they believe that global warming will be a significant disaster for mankind. I love the economic arguement that this guy and all of his collueges twisted science in order to get grants. I would bet his salary is under 250k/year. Now let’s compare the financial power of who they are up against. Exxon alone made 45billion a year and certainly does not want to jeopordize that $$$. They donate 7million a year on the books and likely more off the books to refute global warming. Every oil producer refiner, coal producer, most utillities, many governments,and companies that use a lot of electricity are giving money to suppress and deligitimize the theory of global warming/climate change and the volumes of data that support it. Where are the rich companies that stand to gain from global warming, where is the evidence that they finance propaganda and fake science.
“Climate change researchers must believe in the reality of global warming just as a priest must believe in the existence of God.”
Except that there is evidence from many scientists using many different techniques funded by many different sources that support global warming.
xxxxxxxxxxxxxxxxxxxxxxxxxxx
NYTimes
Philip A. Cooney, the former White House staff member who repeatedly revised government scientific reports on global warming, will go to work for Exxon Mobil this fall, the oil company said yesterday. Mr. Cooney resigned as chief of staff for President Bush’s environmental policy council on Friday, two days after documents obtained by The New York Times revealed that he had edited the reports in ways that cast doubt on the link between the emission of greenhouse gases and rising temperatures.
A former lawyer and lobbyist with the American Petroleum Institute, the main lobbying group for the oil industry, Mr. Cooney has no scientific training
xxxxxxxxxxxxxxxxxxxxxx
After the U.N. Intergovernmental Panel on Climate Change, made up of the world’s top climate scientists, released a report in February that warned the cause of global warming is “very likely” man-made, “the deniers offered a bounty of $10,000 for each article disputing the consensus that people could crank out and get published somewhere. No review, no science, just 10k if you can get an article published disputing global warming.
I presented my research tonight; I am done with my graduate program; I attend commencement in two weeks.
w00t
This is the longest I have ever stuck with any online format. 4 years, two kids, one graduate degree… well done, Ben. Let’s just hope this is all over before I need a freakin’ hip replacement.
Congrats.
Key strategy going forward: Always schedule time for exercise (even if it cuts into sleep…).
Yeah, I know. My health has suffered a bit from sitting on my butt and writing all the time.
I forgot to specifically thank you, as regression analysis was a piece of my presentation. Thank you.
The month I wrote my dissertation, I slept 3 hrs a night on average (and it was the month of November, I should add!). I was terrified that I would destroy my health in the process, but actually I was healthier on average over that month and the entire subsequent period of my life than I was during the 1/2 decade preceding. Perhaps completing a graduate degree is good for one’s health?
I wrote mine when I was in my twenties. I didn’t need to exercise back then!
I took the CA bar when I was age 43. Needless to say, a plan of exercise was a necessity.
Good job, Muggy. But graduation costs money. Maybe you should skip it. Unless your family insists. Those hood rentals are expensive.
WOO HOOOO Muggy! Congrats.
We’re all proud of you, Mugster. Ya did good.
Hugs,
a
Congrats Muggy! I’m still hearing sporadic hiring, wage increase and promotion stories. Stay positive. I feel you’ll do well.
Congrats, Muggy! Way to stick with it…
I suspect the “climate consensus” has been irreparably shattered.
* OPINION
* NOVEMBER 30, 2009, 7:44 P.M. ET
The Climate Science Isn’t Settled
Confident predictions of catastrophe are unwarranted.
By RICHARD S. LINDZEN
Is there a reason to be alarmed by the prospect of global warming? Consider that the measurement used, the globally averaged temperature anomaly (GATA), is always changing. Sometimes it goes up, sometimes down, and occasionally—such as for the last dozen years or so—it does little that can be discerned.
…
Third disproval of global warming tonight- any not from the Wall Street Journal? Somehow I don’t find them the most impartial on the subject. (Who owns them again? Rupert something?)
A new trend in the home renovation market seems to be happening. We took a survey and discovered that demand for cheap new second kitchens has increased. Few contractors are noticing this increase in demand. One commented “the add on second kitchens are for kids moving back home after losing their house and the kids want to spend about 5K for the kitchen.
There is hardly any profit for the contractors in this price range.
So single family houses are being transformed into duplexes?
Two families doubling up in one house leads to more vacant houses.
The economic contraction rolls on.
I agree. I am so glad you and I can see bright things happening.
So let’s sing the song together
Kash Is Cing
Funny you mention this SUguy. We are in the same housing market. I can’t tell you how many homes we would have been interested in if only they didn’t have this 2nd kitchen in the basement. I wonder what $$$ value that adds to the resale of homes. I also wonder how many of those 2nd kitchens are for the older generation vs elder care housing. I was under the impression most elder care in the area was not considered high quality and as we both know w/30 somethings leaving in droves this area is quickly aging.
“The banker had told this friend of mine that senior Goldman people have loaded up on firearms and are now equipped to defend themselves if there is a populist uprising against the bank.”
http://www.bloomberg.com/apps/news?pid=2….
senior Goldman people have loaded up on firearms and are now equipped to defend themselves Firearms won’t help them, they need to hire their own army.