Bits Bucket For February 5, 2010
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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.
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Name:Ben Jones
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Floridians lead U.S. in paying off credit card debt while mortgages lapse:
http://www.tampabay.com/news/business/personalfinance/for-many-paying-credit-card-debt-is-more-important-than-paying-the-mortgage/1070836
My favorite of the comments on the article:
“This is unfortunate, but I can understand. I called my bank a few days ago about lowering the payment. I was informed they could not unless I was at least two months behind on my mortgage. I told them no thank you, I will just continue with making the payments.
Ouch! That’ll learn ‘em.
What hard-@ss negotiation skills!
Friend of mine did the same thing, the payments are killing her. I told her you should have told the bank, “Can I talk to someone higher up, as if I dont get the adjustment, I will be making no further payments, period.”
Ya misspelled ‘larn’…
Ya misspellt “missspellt”.
Spelt is a delicious, nutritious oatmeal substitute. And I didn’t mispellt it.
If it brings us to a world where everyone isnt charging every necessity of life, it will be a good thing…
Hey Step,
Regarding your future station, Harrisburg PA seems to be going bankrupt! Interesting times.
I see. I intend to rent and stay on post anyway. I retire from the military in about two or three years, all my bills will be paid (car payments mostly). I will have no debt and be able to afford what my wife wants in a home in Winston Salem N.C.
I hear Harrisburg is nice though. Looking forward to a Hersey bath!
Highly recommend you visit the Mercer Museum and Fonthill in nearby Doylestown. http://www.mercermuseum.org/
Bucks County and Lancaster County and very enjoyable to explore.
Too bad Uncle Sam does that every day.
This American monthly scrambling to pay everything and everyone from the mortgage to little Brittany’s cell phone bill to the CC is ridiculous, so I have a Plan to simplify this monthly mess and mad scramble.
1. The Federal Reseve Banksters and Wall Street buys off debts and consolidates everyones monthly nut bills from housing, autos, to energy and so on. Charge it to the FED>
2. The Federal Reserve Banksters and Wall Street issues everyone an account and a Wall Stree issued FED Visa Platinum Credit Card.
like: mikey-FRA DebtSlave # 999-99-9999
3. They issue everybody ONE monthly Nut Bill Statement from and Payable to the Federal Reserve Banksters and Wall Street Inc.
$. The Federal Reserve and Wall Street uses the Full Faith and Creadit of the United States Army to visit and seriously hurt, injure or mame anyone who does not pay their monthly bill to them on time. They send in the US Marines with shovels for those rare 2nd time offenders.
Humm…Okay, mikey’s Plan B is …
Debt slavery is the 21st century replacement for the antebellum version. Since no racial discrimination is involved, I see no problem with it.
Voluntary slavery is definitely preferable to involuntary slavery.
Your plan has the benefit of reducing everyone’s monthly postage bill.
“Voluntary slavery is definitely preferable to involuntary slavery.”
What if you didn’t realize you were inadvertently volunteering?
Very, very few people can live off the debt treadmill. And even fewer can do it with a lifestyle above that of a poor college student.
Comment by ecofeco
2010-02-05 16:17:43
Very, very few people can live off the debt treadmill. And even fewer can do it with a lifestyle above that of a poor college student.
———————
That’s because of all the idiots who run up the prices of everything because they use credit to pay for it all. Therefore, those of us who try to live without debt are forced to pay the prices caused by the least responsible people who are most willing to go deepest in debt.
You could simplify it further by simply taking it out of taxes, thus dispensing with the monthly nut AND paychecks at the same time. No longer burdened with Money, we will all work — hard — for the Benefit of the State.
Ronald Reagan permanently turned honest taxation into a form of political Seppuku. The only politically viable taxation any more comes through the power of the printing press or other financial engineering mechanisms about which the taxed populace has only a vague understanding.
This clearly shows an upside down world of financial acumen.
Credit Cards are signature loans. They are not “secured” loans and should be the last thing to be paid.
The traditional priority for payments: Food, House, water, electric, insurance, car payment (if any), membership dues, and way down at the bottom……credit cards.
What this clearly shows to me is a trend in the “value” of houses. People are so “underwater” that losing the house is not a concern. However, not being able to shop at the local boutique and buy meals out 5 nights a week is a much higher priority.
I am sure the unfettered fees and charges associated with credit cards has a big impact in the decision process, but in days long past (10 years ago), the mortgage always had priority. I am sure that is still true for people who have “equity” above 20%.
But this is very bad news for housing prices. (Good if you are a buyer). It means that more people are willing to abandon their house, so long as they can keep going into debt by some other means.
Eat, drink, and be merry……….for tomorrow we die!!!
The New America is the Old Rome……..in decline and falling fast.
“This clearly shows an upside down world of financial acumen.”
No, Diogenes—this is not a demonstration of lack of financial acument at all. These people are doing the sensible thing under the circumstances.
The “traditional” approach you outline made sense in the times past; but this reversal from past behavior makes perfect sense now. When you have no equity, no hope of future equity, and have overpaid by a large amount, the rational move is to stop paying the mortgage but stay current on everything else, at least for homeloaners in non-recourse states who will not have to go BK to shed the house-debt. Having many current accounts will also help demonstrate to a future LL that you are not an intolerable risk due to having made a poor house-purchase “investment” at the heigher of the bubble, so it should help you get into a rental when the time comes.
This was discussed at length back in 2005/2006, and HBBers were predicting this change from historical behavior; it was shocking to me at the time, but their arguments made sense.
Exactly right, Prime.
Look at the comments, the lawyer guy is totally right: CC companies clamp down faster. The is the problem with “hope.” Everybody is “waiting for something to happen.” The banks aren’t doing anything.
An appeaser is one who feeds a crocodile, hoping it will eat him last. - Sir Winston Churchill
The traditional priority for payments: Food, House, water, electric, insurance, car payment (if any), membership dues, and way down at the bottom……credit cards.
These days credit card = food, which trumps house.
Food, transportation, medical and utilities. In other words, day to day operating expenses.
This is totally awesome.
NYT, Published: February 2, 2010
“House Hunting in … Amsterdam”
Some of the highlights:
“…In central Amsterdam most units sell for around 4,500 euros a square meter, or about $584 a square foot.
…
Real estate transactions operate somewhat differently from those in the United States, Mr. Grayson said. To start with, down payments are not typically required. Banks lend the entire value of the house plus the closing costs, and even on occasion money for renovations.
…
Until recently, the loan maximum was set at seven times the gross annual salary of a borrower. Now, in this tighter mortgage market, Mr. Grayson said, banks are lending only four to five times a borrower’s gross annual salary
…
Closing costs can be as high as 12 percent of the sale price but are more typically 10 percent. Six percent of that amount covers transfer fees; the rest is split between the notary and the broker. ”
What did Buffet say? Something like, “If you mix fools and borrowed money you get interesting results”. Wow!
there was a guy who used to post from the netherlands, he’d probably have something to say about this.
Haven’t seen nhz in a while.
Amsterdam, IIRC, was one of the case studies in the second edition of Robert Schiller’s book “Irrational Exuberance”. The city has maintained detailed property records since the days of the Tulip Bubble, enabling the discovery that even including the Dutch property bubble through 2005 that inflation adjusted property prices in Amsterdam have remained roughly unchanged in 400 years.
“at seven times the gross annual salary ”
I don’t believe this can possibly have a happy ending. Especially in the light of recent developments in Greece & Portugal which will surely affect interest rates and availability of credit.
So buying a house makes sense when your paycheck is not keeping up with inflation.
I miss nhz…
He used to post about their crazy loans and subsidies. It was a warning, IMHO, about what they might try over here.
Let’s just hope that our govt sees the potential consequences (all negative) in their bailouts and subsidies, so we can reverse course and get back to affordable housing and a viable, stable economy based on JOBS that produce useful things…instead of us selling inflated assets back and forth.
“Let’s just hope that our govt sees the potential consequences …”
Lol. Stop it, you’re killing me.
Good one, combotechie.
Roidy
April got here faster than normal…
Soon there will be May flowers
nhz was way ahead of us in predicting the amount of gov’t money bombing that would happen.
Hope to see him back now that his side of the world is making news.
Was just thinking about nhz last night myself — in particular with regard to the announcement in the State of the Union speech that the POTUS plans to make the value of U.S. housing start going up again.
Any thoughts on the technical aspects of how this financial engineering program will be carried out? And will the exercise be entirely transparent, or will their be stealth (unannounced) components? For instance, is it possible some of those mysterious all-cash offers that support astronomically high home prices in Coastal Cali might in fact be repackaged TARP funds?
Just curious..
You know I’m a member of the tin-foil hat brigade. Some of that ca$h money might be coming from TARP and also from China (specifically the bulk purchases done behind closed doors). Maybe that’s how we’re going to pay off our debt to them. They unload their (overvalued) Treasuries, and we unload our (overvalued) real estate.
Yah - the real estate will be Taiwan
You think China might be snapping up Coastal Cali properties for cash? Just wait until they unpeg their currency…
You think China might be snapping up Coastal Cali properties for cash? Just wait until they unpeg their currency…
Will they eventually evict the illegals?
I’m wondering if the Chinese landlords will eventually evict the folks who stopped paying their mortgages and are living rent free? Kind of brings to mind when the Chinese government shot all the opium addicts in the head…
Ouch!
Yes, you’re right about unpegging the Yuan. See, if they do this little “transfer” noted above, once they are out of dollars, they will have more incentive to drop the peg (won’t devalue their dollar holdings if they’re largely out of the dollar). It will affect their exports, but the consumers are already sunk in the U.S., and if they’re smart, they’ll focus more on other markets and their own, internal markets.
The plan…
1) unleash 401k money onto the market
heavy printing of cash handed out to government elites
2) subsidize people underwater with “stay in u home” tax credit for the zombies.
3) Massive tax wedgie for those of us trying to wait this thing out. Higher tax rate = more value in interest deduction
4) tax breaks for lenders and builders
5) new purchase tax credit of 16K
6) raise capital gains taxes on everything but exempt housing
7) more loan purchases to keep rates low
9) special tax breaks for REIT
10) tax exempt status for interest on MBS
11) caps on property taxes
12) increase property taxes on rentals to drive rents up. Especially in holes like California.
It will be double plus good.
I like your SoCal cool number eight.
“…In central Amsterdam most units sell for around 4,500 euros a square meter, or about $584 a square foot.
So, seems to me a Dutch school teacher & her husband bicycle repairman, must make a pretty good salary to “afford” $584 per sf “unit”
“So, seems to me a Dutch school teacher & her husband bicycle repairman, must make a pretty good salary to “afford” $584 per sf “unit”
Dad called the doctor
Mum called the nurse
Sister called the lady with the alligator purse
In came the doctor
In came the nurse
In came the lady with the alligator purse
“Measles”, said the doctor
“Chicken-pox”, said the nurse
“Housing Bubble”, said the lady with the alligator purse
Out went the doctor
Out went the nurse
Out went the lady with the alligator purse.
…dunno but I bet any 10 year old kid with a brain and a jump rope chant could spot a housing bubble and tell you who is running the show now.
Dude, have you been to Amsterdam? A bicycle repairman is like a car repairman over here! They have more bikes than cars, and all the hot ladies manage to ride bikes in dresses with high heels. Amazing!
Yes, yes I know…one of my neighbors is from there, last year he got a great management/engineering job, their “family” just got their US Citizenship…that makes x2 “families” this year alone… x1 Dutch, x1 Swedish.
IIUC home buyers in the Netherlands get to write off ALL housing related expenses on their income tax: not just interest and property tax, but also loan principal, insurance, maintenance - the works.
Maybe there really is something to the “Pot is a dangerous drug” belief! Good lord, they must be smoking some good s*** over there, that’s for sure!
Michael Fink,
LOL. And 7 X Income and 110% financing is ‘different’ from Leslie Appleton-Young’s version of “affordability” how… exactly?
The ratio of incomes to debt levels can and should vary by country and region. Here in Florida, we have NO subways, no bike trails between cities, no community centers, and no culture.
The average debt level of 2.5 to 3 in the country overall is not a good metric for places like NYC or other metro areas. Many people in those places have no car, no car insurance payments, and no associated costs. That means they have more disposable income that can go to housing. Consequently, i would expect areas with regional transport and community centers to have prices bid up higher by the difference in costs of living.
Having a price at 4 times income is not out of line. Amsterdam is full of bicycles and most people don’t drive. The 7-8 times is over the top and will collapse.
Example of why people will continue to invest in the US no matter how much debt we carry. Fundamentals of our transactions, lending laws are less horrible than vast majority of other countries.
Again, if you can make the monthly payments, why would it matter if there’s no downpayment? OK, monthly payments are higher, but that’s your choice.
You all scoff, but no-one has actually answered this in a way that I would have to agree with you.
why would it matter if there’s no downpayment?
It does indicate financial discipline on the part of the borrower. I don’t think it matters as much in a stable market. It matters some but as time goes on less. In a declining market it protects the lender because the borrower has skin in the game which would tend to make markets less speculative.
Agree with Rio:
1. Indicates financial responsibility.
2. Protects lender in the event of a RE decline up to ~20% drops. (this is the biggie)
3. A buyer is less likely to walk away if they had to save the 20%+ down payment over 5+ years. It’s easy to walk when you have no skin in the game. Nothing is personally lost if you walk — the lender takes the full loss, not the borrower. Again it goes back to the borrower taking the first loss instead of the lender. It secures the lender’s position.
Government-owned GMAC loses $5B in 4Q
NEW YORK — Home and auto lender GMAC Financial Services said Thursday it lost $5 billion in the last three months of 2009, as losses from its mortgage operations kept the company in the red for another quarter.
GMAC, which is owned by the federal government, is still working to sell its troubled home lending business, ResCap. Mortgage operations overall lost more than $4 billion during the quarter.
Its automotive operations proved to be a bright spot. The unit has been profitable recently and made $369 million during the quarter. GMAC is the main lender for General Motors customers and dealers and recently took on the financing duties for Chrysler Group.
The company said its auto financing business will continue to be its main focus in the future.
“It’s automotive operations proved to be a bright spot.”
Did I not read recently on this blog about General Motors building auto manufacturing plants in China while at the same time closing down plants in the U.S.? And they did this right after being bailed out by the guvmt on the pretex that American jobs were at stake.
This was only a week-or-so ago, anyone remember?
(I need coffee.)
Exactly where is our beloved free press in all this? US media collectively agreed that they dropped the ball by not publishing the rubbish and misguided WMD reports prior to Iraq war. Editors said they did not want to appear unpatriotic during the healing from 911. Obviously that was empty self blame as media is doing the same now with their deer in headlights as US is blindly robbed by large banks, corporations, GS, Fed on and on. Paulson was on Charlie Rose the other night. I had to turn it off.
“……building auto plants in China…….”
Pretty much a requirement/law to sell cars in the Chinese market. You get to be a “partner” with a locally owned operation. You supply the engineering and production know-how (that they get to keep) and they supply the workers and the market.
Another example of the capitalists selling the rope to peasants, that the peasants will use to hang them with.
Those “old paradigm” Chinese seem to think that manufacturing jobs are worth having. Silly them, they just don’t get it.
This is the same thing that happened in the 80s. The Big 3 closed US plants only to open new ones in Mexico, thus decimating the blue collar jobs in the region.
And guess what? Cars only kept getting more expensive.
Which is why the neocons pet screed of union caused flight is bullcrap.
Well Eco, if the the jobs went to low-paying mexicans and GM still went bankrupt, what caused the bankruptcy? was it all due to crappy products or was it pension obligations?
Poor management is the #1 reason the U.S. auto manufacturers declined.
I remember because I live around here….GM has a factory down the road. Ford has 3 nearby. Yes, the assh—- were going to shut down a factory here and build a big one in China.
GMAC is DiTech - you know, those stupid “people are smart!” commercials that drove us all nuts even long after the bubble had popped.
“The company said its auto financing business will continue to be its main focus in the future.”
“-Lets see, where can we get the most government subsidies? “
Another example of the “Capitalist Hanging Rope”……
GMAC’s reason for being was to offer financing for GM cars. A competitive advantage vs. the Japanese manufacturers, who did not have their own financing arms, or if they did, were not as competitive (interest rate and terms).
Then, the rocket doctors at GMAC figured they could make a lot more money on financing, if they allowed their dealers to use GMAC to finance ALL cars, including Japanese brands sold by their GM dealers.
Poof went one of the advantages that GM had.
“Its automotive operations proved to be a bright spot.”
That’s telling.
Helps when you have a government agency submarining your main competitors via massive recalls.
Doesn’t GMAC finance other brands besides GM?
Yes! Along with boats, RV’s and mobile homes etc…
And houses, IIRC.
GMAC finances everything. And I mean EVERYTHING. Personal, business, corporate, governments. You name it.
Bah. Don’t start that crap. Toyota screwed the pooch. Happens to the best of companies.
I’m hopeful to get a used Prius on the cheap soon.
Detroit was Washington’s favorite whipping (some of it deserved, some of it not) until they all had one/both feet in the grave.
Someone had to fill the void.
What other GMAC SLOBs did worse than automotive?
GMAC is also Ally Bank. How can they offer such high (relatively speaking) interest rates on savings and CDs? Must be those TARP funds at work.
Every time I hear the name, I think “Ally Banka and the 40 Thieves”.
It’s Bank Failure Friday! Following in the wake of last weeks Bank Bomb of Six (that’s right - six) closures comes the first Friday of February! Check out these compelling story lines:
Will regulators stay home to watch the Super Bowl?
Will regulators stay home to postpone a closure by a week to take advantage of Presidents Day and the three-day weekend?
Will the East Coast Snow Storm keep regulators at home, or will it just be California, Florida, and Georgia banks as usual?
Will the lack of money at the FDIC keep regulators at home, or will they just take Greyhound?
Tune in Friday evening for your very special Bank Failure Friday Final Call!
[Waaaay too much coffee for this early in the morning!]
Will the housing market come back after the Souper Bowl?
P.S. Coffee is perking away in the kitchen — I can hear it, smell it and almost taste it already…
I think the housing market will make a short recovery during half-time, but will be trending downward again by the end of the game.
Half-time debt cat bounce?
…will be more entertaining than any other Superbowl halftime show.
Since John Entwhistle’s passing.., they really aren’t “The Who” any more. Come to think of it, their insistence Keith Moon’s replacement “upgrade” the percussion skills ruined it for me anyway.
Which teams are playing again?
And Jimmy Page is auditioning singers for a “ZEP” reunion tour.
Wife and I once played w/ Jimmy Page & Robert Plant as members of the pickup-backup orchestra. It was quite the show…
D,
The New Orleans Saints are playing the Indianapolis Mannings.
Since John Entwhistle’s passing.., they really aren’t “The Who” any more. Come to think of it, their insistence Keith Moon’s replacement “upgrade” the percussion skills ruined it for me anyway.
Yeah, boring. Not the same.
Ringo’s kid Zak is behind the kit, and while he’s highly competent, he just can’t deliver the verging-on-chaos clamor that Keith did. And Entwhistle isn’t replaceable, either, the highly skilled Mr. Palladino notwithstanding.
Professor Bear,
Seriously? Hell, I’d lug Marshall stacks up a flight stairs just to do that!?
cereal,
Normally I’d frown on all of this Re-Union stuff ( as it usually falls flat on it’s face performance-wise..? ) but Jimmy P has kept his guitar skills honed to a fine edge, even after all these years. “It could get Loud” was rocking good fun!
Pete Townsend is bound and determined that The Who will take their place among the greats, and while I welcome his efforts, the truth is, they really were a very distant 3rd. Outside of Tommy and Quadraphenia, lots of pulp and filler. And that’s as a fan.
The Who’s drummer since 1994 is Zak Starkey, son of Richard Starkey a.k.a. Ringo Starr. He’s good but he’s no Keith Moon.
“I’d lug Marshall stacks up a flight stairs just to do that!?”
Carrying fiddles around is light work…
Comment by Professor Bear
2010-02-05 08:57:11
Wife and I once played w/ Jimmy Page & Robert Plant as members of the pickup-backup orchestra. It was quite the show…
———————
That’s very cool!
Lucky Bear family!
I’m going to the opera on Sunday with a couple of gal friends. Hubby can fill me in on the good commercials when I get home.
What team is playing against N’Awlins?
All the commercials will be on YouTube within minutes, believe me.
The New Orleans Saints are playing against the Indianapolis Mannings.
Poopytown vs india-no-place. The drama.
Katrina will be brought up every other sentance.
I long for another huricane to finish the job. Maybe a nice sucession of category fives. One after another.
Should be a fun game to watch but I might have to turn the sound off.
Haven’t heard much about rebuilding there. Assume they rebuilt the houses after some minor patch job on the levy.
Houses? No, not really. Most of the French Quarter? Yes. It’s the money making tourist destination.
Also rebuilt the Garden District. 2 universities and surrounding rich folks.
And yes, the last time I was in NO, it was a nasty, nasty place with only a few bright spots.
Hmmm. Sunday afternoon. I have a project that requires some quiet concentration time. Good time to go to the university library and get a seat.
So it was YOU sneaking around in my kitchen this morning!
Bank of La Jolla should be history by this evening.
I heard Mutual of Obama is in trouble.
Yep, they own to many BUSHel’s of war…heheheheehhee
I have been to a couple Beazer developments to say they are shoddy would be kind, they are crap!
Beazer Homes posts a $48 million profit for Q1
Homebuilder Beazer Homes earns $48 million in fiscal 1st quarter on generous tax gain ~ February 5, 2010
ATLANTA (AP) — Beazer Homes USA Inc. posted a $48 million profit in its fiscal first quarter thanks to a $101 million tax gain.
The homebuilder said Friday it earned $1.17 a share in the three months ended in December. That compares with a loss of $80.3 million, or $2.08 a share, in the prior-year period.
Revenue was flat at $218.8 million versus $218.2 million.
Without accounting for the tax gain, analysts polled by Thomson Reuters were expecting a loss of 90 cents a share on revenue of about $200.6 million.
Beazer, which caters primarily to first-time homebuyers, is headquartered in Atlanta and has operations in 16 states, with many communities along the Southeast, Mid-Atlantic and Southwest. The company said orders for new homes increased almost 37 percent compared to year-ago levels as homebuyers took advantage of low mortgage rates and federal tax credits.
The key words in this report is “tax gain”. From the New York Times:
“…But tucked inside the [November 6, 2009] law was another prize: a tax break that lets big companies offset losses incurred in 2008 and 2009 against profits booked as far back as 2004. The tax cuts will generate corporate refunds or relief worth about $33 billion, according to an administration estimate.
“Before the bill became law, the so-called look-back on losses was limited to small businesses and could be used to counterbalance just two years of profits. Now the profit offset goes back five years, and the law allows big companies to take advantage of it, too. The only companies that can’t participate are Fannie Mae and Freddie Mac and any institution that took money under the Troubled Asset Relief Program.”
“The only companies that can’t participate are Fannie Mae and Freddie Mac and any institution that took money under the Troubled Asset Relief Program.”
That’s the one small silver lining. But in general, it appears the businesses that would benefit the most would be those most directly tied to the bubble (bigger profits followed by bigger losses), assuming they’re still in business.
If we’re going to spend money, I’d rather see it going to the businesses of the future than the businesses of the past.
SDGreg,
Right on. We need to bend over backwards to make sure those that brought this country to it’s knees walk away w/ as little pain as possible!
It’s the ‘New’ Ammerican Way.
This gives value to otherwise worthless companies that show massive losses if the loser companies can be bought up on the cheap and their losses can be used to offset gains by the acquiring companies.
IIRC Lennar, Centex and Toll Bros. all posted “profits” due to “tax gains”.
exactly
Now you can make a rational arguement that we need to save large financial institutions, but there is absolutely no arguement for bailing out these builders. If they go under there are 10,000 others willing and ready to take their place, not to mention that we really don’t need any more houses for a while.
CRAZY
“If they go under there are 10,000 others willing and ready to take their place,”
I would make the same argument for financials; there are plenty of smaller financial firms that could grow to fill the ecosystem-space left by large firms failing.
+1, Prime.
“A tax break that lets big companies offset losses incurred in 2008 and 2009 against profits booked as far back as 2004. The tax cuts will generate corporate refunds or relief worth about $33 billion, according to an administration estimate.”
While providing no benefits to new businesses (which don’t make campaign contributions since they don’t exist yet).
a tax break that lets big companies offset losses incurred in 2008 and 2009 against profits booked as far back as 2004.
Weren’t those “profits” from 2004 actually deferred interest phantom profits? Banks booked “fully amortized” payments, while the FB’s were actually paying the minimum on the neg-am. So banks are using a bogus number as their comparison — it’s like some guy saying: my house was “worth” $695K in 2006, now it’s worth $295K, can I have a tax break on my “loss” of $400K.
This is straight up highway robbery.
“Weren’t those “profits” from 2004 actually deferred interest phantom profits?”
You just made me feel a little better about this travesty. If the profits were “phantom”, and only due to the neg-am interest, then it makes some sense for them to be able to claim the losses against past income; in that case, it’s cancelling out the bogus accounting of the past. If the income had been real, I would have more of an issue with it.
Of course, the neg-am angle only applies to banks/lenders; for the builders, it is sheer highway robbery.
You’ve both just nailed the problem with most of the Level 3 assets.
“Mark-to-fantasy.”
here is what i think happened…
a net operating loss creates a deferred tax asset which oridnarily creates a deferred tax benefit. if it is not likely that the company will be able to utilize that asset in the future…the company is required to book a valuation allowance against that asset…which basically negates the tax benefit that would have been recognized in the loss year.
when the law changed…it caused the deferred tax asset related to the net operating loss to be recognizable…which allowed the company to remove the valuation allowance that was placed on the asset in the year of the loss. if the year of the law change was subsequent to the loss year…and if the company’s operations had stabilized a bit…the reversal of the valuation allowance would cause a large tax beneift to the company in that year and possibly show a profit for that year ending.
Card company results show waning credit card use
Rise of debit cards, waning credit card use highlights fourth quarter from , Visa.
NEW YORK (AP) — Shoppers still reach for plastic at the checkout, but the card they grab most often these days is a debit card, not a credit card.
That was spelled out Thursday in MasterCard Inc.’s fourth-quarter results. The payment processor posted a 23-percent profit leap, but its shares were beaten down as the numbers revealed further evidence of the fading use of credit cards, whether by choice or necessity.
“People have been utilizing credit, obviously, to a much less extent,” MasterCard Chief Financial Officer Martina Hund-Mejean said in an interview.
Meanwhile, rival Visa Inc.’s results not only showed a huge profit gain, but also its dominance of debit, which consumers use more often to buy necessities like food and gasoline. That shielded the San Francisco company’s stock from the session’s widespread declines.
Credit cards used to have the monopoly on the convenience of purchasing with a swipe instead of hauling $300 each week. Debit caught up quickly, especially in the under-$20 transaction market. Rather than respond to this new threat to their business model, credit card companies dug their own grave by slapping on fees, raising interest rates, playing games with due dates and the post office, and training customer service to act like the Soup N aa*z*i. As a result, CC lost a lot of deadbeats who would use the credit card (3-5% cha-ching) but pay it off — me, for example.
(I refuse to jump through their flaming hoops just for their overpriced “rewards” which IMO are just kickbacks deals with another company anyway.)
They get what they deserve.
“They get what they deserve.”
Anymore it’s “We get what they deserve”.
American Consumer = one step backwards
Amish Spendthrift = another step forward
A spendthrift is a person who spends money in an extravagant, irresponsible way. Opposite of what it sounds, but not appropriate to the Amish!
lol i.e., “same difference”…since they are a “backwards” peoples.
My Taoist bias occasions me to seeing things bassackwards & dn ǝpısuʍop
Amish this, Amish that………..I’m tired of hearing about how great the Amish are.
Local fast food chain advertises their “Amish-made Cinnamon Rolls”. Other than weighing three pounds and having half a gazillion calories, there’s nothing special about them.
Sheesh…
Angry with the Amish..
Angry with Cinnamon Rools..
This could get Mess could get Sticky !
Gives this American, X-GSfixer, a wide birth until Friday Night Happy Hour officially begins.
I’m not mad at the Amish. I admire their adherance to their lifestyle and faith, in our consumerist culture.
I just get annoyed by all the guys wring advertising that use their image as sales fodder.
Besides, this is my last day to be cranky. Had an interview/sit down yesterday, my new job starts Monday.
Hey Congratulations, seriously!
And hey, I gotta real shaker rocking chair (but nobody knows what that is here which is cool too I guess)
Someone even told me they know a Brazilian who could build armrests for it.
Congrats on the new job, X-GSfixr! Hope you like the new job, I know it’s been a while in coming.
I’ve always gotten a good laugh out of “Amish free-range chicken” on fancy restaurant menus. Did the chickens know they were Amish? Did they wear sober black suits and grow leprechaun beards? Refuse to ride in cars? It reminds me of a Far Side cartoon with a chicken lying on a beach chair, sipping an umbrella drink and saying to the bikini-clad babe in the next chair “They made me a free range chicken, and I never looked back”.
Enjoy your weekend.
Great news X-GSfixer,
I know that you have had a rough time and I hope that this new job helps out.
That is so cool, X-GS. I hope you’re happy and that this job lasts ya as long as ya want it.
Nice work GSF - literally!
Fixr, I am really, REALLY happy for you! I hope this employer is more appreciative of your dedication than the last ones were…you deserve a good gig this time. Congratulations!
Yay! Congratulations GS-fixer! Hope you find this job to be the most rewarding job you’ve ever had. So glad to hear the good news.
Declining credit card use?
Customers are being frugal and not encumbering their future revenue stream with interest payments on junk they didn’t need in the first place?
Wow, stage right for Consumer Nation, next up is Bailout Nation for Visa, MC, Discover, etc.
I’m forced to have a credit card or no airline tickets, rental cars, hotel rooms, etc. With these fun and interesting card fees and interest rates I’m forced to actually use the thing.
Sigh.
Roidy
P.S. I really miss Olygals take on this. I hope her family is as ok as possible in this.
Do they count it as credit card “use” if you pay your balance in full each month? We pay for most of our purchases (groceries, gasoline, utility bills) with a cash-back card.
The CC company recently raised our credit limit.
“Customers are being frugal and not encumbering their future revenue stream with interest payments on junk they didn’t need in the first place?”
I blame the A&E show Hoarders. People are realizing that their own homes look just a little too much like the houses of people who are willing to display their mental illness on television. Well, not really, but in my case it sure is a good kick in the pants to break down and get rid of my empty moving boxes.
Seriously, though. People used shopping to use up their time. I don’t know what they are now doing to use up the same time, but less of that time is going to shopping. Maybe they are actually using some of the stuff they bought. Maybe they are just reorganizing the stuff. Maybe they are looking for jobs. Maybe they are still shopping but getting cheaper stuff with the debit card. Whatever they are doing, less is definitely more as far as I am concerned.
“I blame the A&E show Hoarders. People are realizing that their own homes look just a little too much like the houses of people who are willing to display their mental illness on television.”
I used to remodel houses and this statement is scary true.
I only saw that show once, but was a bit taken aback by some of the similarities I had with the “hoarders.” It is scary how things can get out of hand so easily.
Thank goodness for my mother’s Germanic genes fight against the hoarding instincts inherited from my father’s side.
I work as much overtime as I can since my employer still sees fit to grant it. I know the money will come in handy/be needed later. We save as much of it as possible.
I buy airline tickets, rent cars and hotel rooms with debit.
I’m still calling drummin we need an update for firefox 3.6….thank man!
He posted an update in the Facebook group. Said the new version (3.6 compatible) was here:
http://mysite.verizon.net/drumminj_tx/joshuatree.html
The reported fiscal problems in Greece are many and varied. I wonder how much of the current problem can be tied to costly hosting of the 2004 Olympics.
Euro is below $1.38 this morning. First time I’ve seen that since I got to Cyprus. If the Greeks default then I GUARANTEE a quick 10% drop in the Euro. If Portugal or Spain follow then all bets are off and the shorts rule the day!
As Americans we may be from be from New York, Texas, etc but we’re still Americans first. Europeans are from Spain, France, etc and they are from their homeland first and Europe second. Remember that fact when the NoEuropos let the ClubMed Eurpos flounder in their debt pools in the coming months.
Can’t Bernanke just pay for all of that stuff. Stingy b@stard.
Back in the autumn of 2008, after the collapse of Lehman Brothers, the ECB loosened the rules which govern how banks can get central bank funds. In particular, it let banks use government bonds rated BBB or above in ECB money market operations, instead of merely accepting bonds rated A-, or more.
This was initially presented as a “temporary” policy, slated to last until late 2009. But last year the ECB extended the policy until the end of 2010. Thus, during 2009, banks which were holding Greek bonds have been merrily exchanging these for other assets via the ECB. This, in turn, has helped to support Greek bond prices (and, by extension, Greek banks that hold a large chunk of outstanding Greek bonds).
Until recently, many observers thought – or hoped – that this policy would be extended again, perhaps until 2011 or beyond. For although Greek debt currently has a credit rating that meets the old ECB rules, there is a good chance the debt will be downgraded this year. This creates the risk that Greek bonds will be excluded from any newly tightened ECB regime.
Gillian Tett, FT: The race is on for Greece before the ECB exits
mrktMavenFL,
Just what we needed, a sequel to “My Life in Ruins”. No Banker Left Behind euro-style baybee!
Perhaps Brazil should rethink its dual hosting of the Olympics and the World Cup. Mexico did that in 1968 and 1970, and the 70’s were a disaster down there.
Perhaps Brazil should rethink its dual hosting of the Olympics and the World Cup. Mexico did that in 1968 and 1970, and the 70’s were a disaster down there.
I think the Rio de Janeiro Olympic thing is different than Athens, Mexico city and some others.
My opinion: The Rio de Janeiro Olympics potential benefits are greater than those of other past Olympic city hosts.
I will first say that I do have a horse in this race however I also think I am being objective in my thinking. I am also looking at this from the point of view of a resident of Rio who does not have much problem with the entire nation of Brazil spending money to improve this one city. Any other opinions will be appreciated too.
1. The first reason why Rio’s situation is different is that it is getting a 3fer, The Pan American Games in 07, part of the World Cup in 2014 and the Summer Olympics in 2016. Having three major world events so close in time and in the same city spreads out the costs and gives Rio two dress rehearsals before the big show.
2. Crime: On of the greatest benefits will be the alleviation of crime in Zona Sul (the rich, middle-class and tourist south zone including Leblon, Ipanema, Copacabana and Barra.) These richer areas are pocketed by slums, which before now had no constant police presence however now that is changing. One by one the police are taking over these areas. (thus the helicopter shot down in Oct.) Rio’s police force will double by 2016 and pay will increase almost 100%. For Sydney, Barcelona, Peking, London, Atlanta etc. this kind of thing was not as important but for Rio it will be huge, not only in reality but in the evolving perception of potential tourists.
3. Tourism: Tourism is more important to Rio than for many of the other past Olympic hosts. Any perception of increased safety in Rio will be a great boon for tourism. Millions come but millions stay away because they are scared. Rio’s reputation for danger is worse than any of the past Olympic cities I mentioned above therefore any improvement in this area will be of greater benefit to Rio than for past Olympic hosts.
Many Olympic cities experience a drop off in tourism after the Olympics but what major world events did those cities have after the Olympics? Rio has New Years Eve celebration on Copacabana beach and then Carnival EVERY year. These huge, ongoing, world famous events are not going away. Other Olympic cities had no such thing.
Rio de Janeiro (city and state) also have world famous beach destinations, beautiful, friendly people, warm weather, good food, music and a certain way of life that draws people much more than a place like Peking, Atlanta or Mexico City. Rio is arguably the world’s most beautiful city. It has ocean beaches and a huge lake surrounded by mountains covered by the world’s largest urban forest. The visuals beamed all over the world for two weeks will be unsurpassed in beauty by any Olympics ever.
Infrastructure: Unlike many other Olympic cities, Rio greatly needs and will receive massive infrastructure upgrades. Many roads, tunnels (very important in a mountain city), bus lines and the subway will be expanded and upgraded. The airport will be expanded and hotel rooms will be added and upgraded. The city will be cleaned up. Brazilians are a proud people; the entire nation of Brazil will pump money into Rio. Brazil’s economy is bigger than Spain’s, Australia’s or Greece’s or Mexico’s. It will be able to absorb the costs easier. Brazil is on an upswing. They will have the money to improve their most famous city.
For these and other reasons I think the prospects for Rio de Janeiro, post Olympics, will be better than for some of the other past Olympic hosts.
I hope it turns out to be a BEAUTIFUL thing for the Brazilian Nation…but there are some ne’r do wells that-R-a-hidin-in-acave…that are “fanatically” attracted to Global Icons.
The Brazilians, Chileans, and Argentinians I’ve met are a “different deal” compared to the stereotypical Latin American that everyone in the US is used to dealing with. More “European” in skills and stature/outlook. It’s not a coincidence that so many Formula One and Indy car drivers come from there.
there are some ne’r do wells that-R-a-hidin-in-acave…that are “fanatically” attracted to Global Icons.
Hwy
Good point. I hope they know this.
More “European” XGS
Yes, especially in the south, and Brazil has the most Japanese in the world outside of Japan.
Man it’s too hot here tonight….
I just learnt about the tragic news of OlyGal’s passing away this morning. Heart-broken here.
We had much in common - books, gathering wild mushrooms, irreverence, and the quest for the perfect martini.
You will live on as long as there are morels and martinis to be found.
Au revoir, you impish pixie rogue!
Thank heaven you’re back, Faster.
I asked a question yesterday that you could answer - why is the yen strong relative to the USD? It is just on the basis of their strong banks?
Also there is a charity that Olygal loved that we can contribute to. Ben included in his announcement of her tragic passing.
FPSS!
Top o’ the morning to you! Get un-busy and straighten this mess out, will ya’?
I just learnt about the tragic news of OlyGal’s passing away this morning.
Thanks FPSS, I don’t know how I missed it.
I don’t know what to say… I had always hoped that some day she would show up here again, I loved her writing so much.
BTW, welcome back. I still find myself in tears at times thinking about what she would say to certain postings and posters.
BTW, welcome back. I still find myself in tears at times thinking about what she would say to certain postings and posters.
Thanks, I wasn’t really gone, I just haven’t had time to post lately and I completely missed Ben’s announcement.
I am so sad.
I really wish I’d gotten to meet her.
I also missed the announcement. That’s awful. One of the most entertaining posters ever and an apparently fun person. I was hoping she’d show up under another handle, figuring maybe she had some loony Web stalker. The trees will remember her, and a lot of the cranks here.
She was great for lightening the darkest of ursine moods.
I keep expecting her to jump into one of these threads with one of her loopy commentaries. Y’know, on topics like farty, bouncy retrievers, Bigfoot in the bathroom, the large insect that ate the real estate agent, trees staying up and developers going down, and so forth.
Olygal was like the White Raven, very rare and very Magickical.
I wish she were here
Who knows…I saw a white raven again today.
a post from from me on another blog
” mikey says:
February 5, 2010 at 5:02 pm
I live in Wisconsin among 13-14 huge Burr Oak trees. Ravens roost in them and occassionally hop along my upstairs balcony railing to wake me up. I thought that I saw something unusal a couple of weeks ago looking up but the sun was in my eyes. I usually ignor them until they poop on my car then we have words.
They were goofing around and raising Cane above me today and I looked up. Above me were 11 black ravens and in the middle of the flock was 1 white raven. I have been around the world and around ravens since I was about 9 years old and never seen a white one”
What? When? Where?
Where did you find this out?
ecofeco
Do you mean me ?
Now I is confused.
I’m asking about OlyGal’s passing.
What’s the scoop?
Sorry ecofeco
I believe Ben posted it on Jan 29 2010.
You can use the calender on the right to scroll back to find it. Limited details but very, very sad.
Found it. January 27, 2010
Aw crap.
Thanks for the info.
I am super depressed.
I was looking forward to showing her the pictures of India, particularly of the wholesale flower market that I woke up pre-dawn to get to.
Flowers and flowers and flowers and flowers … all that beauty.
I will miss you, Oly!!!
“I was looking forward to showing her the pictures of India, particularly of the wholesale flower market that I woke up pre-dawn to get to.”
Ooooooo! Ooooooo! OOOOOO! Show me!
(Yes, I’m very sad too. That girl was simply a delightful creature.)
I miss the good-humored sparring of OlympiaGal. It is a lonelier world without her. In her posts, her intelligence showed by the humor she blended in. She was a colorful individual in a less colorful world.
A little later today Hwy’s going to a “Losty’s Squatter’s Brew” in honor of these folks!
Hip Hip Hooray to: “benign neglect & “Squatters remorse”
“…But dozens of holdouts, Lokitis included, refused to go — even after their houses were seized through eminent domain in the early 1990s. They said the fire posed little danger to their part of town, accused government officials and mining companies of a plot to grab the mineral rights and vowed to stay put. State and local officials had little stomach to oust the diehards, who squatted tax- and rent-free in houses they no longer owned.
Steve Fishman, attorney for the state Department of Community and Economic Development, said “benign neglect” on the part of state and local officials allowed the residents to stay for so long.”
Those who remain in Centralia like to keep up appearances. In mid-January, Christmas decorations still adorned the street lamps, a large manger scene occupied a corner of the main intersection and a 2010 calendar hung in the empty borough building. But the holdouts are fighting a losing battle. The building’s wooden facade is in dire need of a paint job; in the Odd Fellows Cemetery, vandals recently knocked over dozens of tombstones. Nature has reclaimed parts of the town.
The fire began at the town dump and ignited an exposed coal vein. It could have been extinguished for thousands of dollars then, but a series of bureaucratic half-measures and a lack of funding allowed the fire to grow into a voracious monster — feeding on millions of tons of slow-burning anthracite coal in the abandoned network of mines beneath the town.
Few remain as 1962 Pa. coal town fire still burns:
By MICHAEL RUBINKAM, Associated Press Writer
I have been there and it is a INTERESTING PLACE to see.
Smoke everywhere. Abandened buldings. Streets with no houses. A few “survivors” walking around. Roads buckled.
It looks like something out of a sci-fi movie.
If they were smart - they could make a fortune off tourists.
Or even make a reality show.
Is Centralia by Oil City?
Sorry, they are 219 miles apart.
Yeah, I was a geek and map-quested it.
Hey Hwy, I’m cooking up another squatter plan. Since I’m way out in the backcountry, only one road in and it’s a single track and goes through canyons and around rocks and stuff like that, I’m thinking of getting me some of that Hercules dynomite and blasting the road shut (after stocking up on coffee, canned cow, and some canned Dinty Moore beef stew) and holing up. Since I’m on a well and all electric, I wouldn’t know the difference, and since there’s also no mail service, I sure couldn’t get a check to the landlord that way, neither. Could buy myself some time alone in the redrock…
And Squatter’s Beer. And some of them little cracker goldfish thingys for snacks.
Only problem I see with the plan is if there might be Bigfoot out here and I’d be stuck out here with Uncle Hairy, who might have a penchant for them little cracker goldfish thingys..
Geez, Losty I dunno, could be risky…that Hercules dynomite might wake up those ghostly Goblin Valley Chupacabra’s, all the one’s I’ve glimpsed out there in utarrrrrrrr seem to have a tendency to run towards the East…do theys get winded afters awhile?
I’m sure ol George Hayduke will swing by and straighten things out.
I think your cool for now Losty. My little sister says she met “Uncle Hairy” hitch-hiking on her northerm Mn backroads again last Saturday night. She left him drinking and dancing in Dee’s Bar in Ely at about 1:30 am.
…but he does get around.
You know what’s weird? There’s a cave house up the road from me, you can’t see it, but you can see the cliffs it’s in, about 1/4 mile away. Nothing between it and Moab, some 60 miles as the crow flies, except wilderness. Last night the cliffs were all lit up, like by a motion-sensor light. I drove up there today, it’s at the end of the road, you have to pass my house to get there, and there’s nobody living there, the snow is deep and no tracks…except…some very very big and deep huge prints going up to one window. I was too close to being stuck to stop and go check it out, had to keep the tires moving.
So, tonight, I’m putting out Bigfoot bait - some old Nestle candy bars from last Halloween. I’ll be ready with the camera and my running shoes.
I used to see a lot of a curious omega timberwolf long ago but I can’t help you with bigfoot.
Why canned cow? Beef on the hoof is self-preserved until needed.
canned cow = canned milk
Yeah but you can get fresh milk from a live cow.
I was restocking at my local liquor store last night, and the guy in front of me bought a pint with nothing but small change. After he left, the clerk said that they’d been getting more change in the last couple of weeks than ever before. He said that week was the first time they’d ever not gone to the bank to get change, as they had too much as it was.
As I was leaving, the guy said hey!, and held up a baggy of change he’d just been handed by someone in the drive-thru. I glanced at the car as I left, it was a suburban mother-type in a nice minivan. Hard times…
“…the clerk said that they’d been getting more change in the last couple of weeks than ever before.”
Thanks — now I feel better about not handing change over to the guys standing around at San Diego street corners with outstretched hands.
I dunno, I used to go to CoinStar machines.
Now I grab a handful of change every time I go grocery shopping. Since I use the self scan lane I feed the coin slot with a couple of dollars of pennies, nickles, and dimes every time, then swipe the debit card.
The only reason is that way it saves me the 8.9% Coinstar fee or whatever it is, and I don’t have a $100 jar of coins sitting around.
Then again, I doubt the average Jane Pint of Jack in a Suburban does that level of analysis on her coin jar.
That’s pretty clever, Bad Chile.
Nice coinage laundering scheme — maybe you ought to join the federal government’s financial engineering team?
I just know this idea qualifies me:
1) Mint nickles at nine cents a pop.
2) Sell nickles to banks at face value.
3) Buy nickles back at six cents a pop, giving the banks one cent of profit but saving the US government three cents off what it normally costs to make a nickel AND keeping our friends at the banks solvent!
If we make enough nickles we’ll be rich I tell you!
…we’ll be rich I tell you!
If I had a nickel for every time someone said that…
speaking of coins:
Try explaining to 7-11 store clerk from India why you are so excited upon discovering a wheat penny. The woman looked at me like I was nuts.
“…why you are so excited upon discovering a wheat penny.”
Mr. Cole found a 1920…that was a good “quiet time”… tankxs to his 3 hours spent on Google researching the subject!
Good one lavi d!
A wheat penny. Cool. I used to collect coins when I worked at a donut shop. Liberty head dimes, wheat pennies, buffalo head nickles, silver quarters, silver dollar certificates and five dollar gold certificates. I actually came across a 1934 ten dollar bill. I would exchange my money for the old coins.
It’s like discovering gold finding those gems in ordinary everyday coin change.
You need to work in a QuikTrip/7-11 close to an area with lots of elderly people, and a high rate of home burglaries/break-ins.
My son in law used to work in one like that. Guys coming in all the time, and using pre-64 coins, two dollar bills, and silver certificates to buy Colt.45.
Don’t be knockin’ the Colt 45.
“It gets the job done”
(In case your pop culture references are a little rusty, that has been the Colt 45 advertising line for the past few years).
Don’t let the smoooov taste fool you.
I got a Swiss Franc in with my packet change the other day. No idea how. Every now and then that seems to happen.
Wheat pennies are kind of cool, though you can get tons for about 3 cents each or so at a coin shop, so not such a big deal if you seek them out.
Did everyone know that last year was the 100th anniversary of the very first U.S. circulation coin to feature a real person on it? The Lincoln penny - first created in 1909.
I think this is interesting, and a bit telling. I see it as similar to how every dang new thing that’s created/donated to some city, school, church, etc. now has to have a plaque on in commemorating someone - usually the person who donated it. It’s telling because I see all this as a general change in the philosophy of America. Before about 100 years ago - we were all about ideals, not people (for the most part at least). All our coins for instance had one thing on them - lady liberty. Now just about everything we do that’s significant has to be in commemoration of some person.
Pint of jack first, Then the analysis.
Dang, you know about that strategy too!
“Then again, I doubt the average Jane Pint of Jack in a Suburban does that level of analysis on her coin jar.”
Hey now, hold on just a second there Pilgrim! At Bed Bath & Beyond they have a coin sorter for $9.99 …throw in a 20% discount coupon and you’ll still be helping to pay for that long container ride over the Pacific.
She could have young children but I have my 12 year old roll my coins. He enjoys it just like I did at his age. Then I buy him a treat at the store.
If you buy stuff from amazon, itunes etc., you can use a coinstar for no fee in exchange for a “gift” card.
The TD bank in my neighborhood has a coin machine and they convert into bills for free, even if you are not a customer.
Those Coinstar machines are a ripoff.
Banks around here have FREE machines in their lobbies (Zion’s Bank, Central ID CU, etc.).
Last month, saw a guy in the credit union with a BIG container of change. And the teller was helping him count it.
When I see the “spange-ers” (people who ask for spare change) on Tucson’s oh-so-hip 4th Avenue, I tell ‘em that I don’t have any cash.
Liar that I am, I’m usually carrying the quiet sort of cash (y’know, green things with dead presidents on them). And, no, they’re not gonna get that either.
“Hard times …”
… makes cash the king.
Cash or half-pints of cheap liquor. Better inflation hedge/survival tool than gold?
When liquor is cash, I will have my own printing press!
the guy in front of me bought a pint with nothing but small change.
Now that’s the kind of change I can believe in.
+1
Same here. Went to restock my liquor in Syosset NY and the owner was complaining that the only people coming in all of last month are the daily drinkers for their $5 pint. Gone are the days of $100 wine bottles.
This is an area where the minimum house is $500k and a whole bunch for supposedly $2 million.
wonder how the single malt sales are doing
Oh horrors! If they discontinue their weekly wine runs, whatever are people going to stock in the brand-new wine cellars which they installed just off the man-cave?
I guess they will be the best-looking food-storage/ bomb-shelters in the world. Think of all the canned peas you could fit into those wine racks. Maybe even a sawed- off shotgun. Temperature-control meth lab, track lighting to grow you-know-what…
“Gone are the days of $100 wine bottles”
? Where they ever really here?
Personally, I think this is a ‘good’ way to drink. When you limit yourself to “cash on hand” when in the Booze Barn, it forces you to get creative, notice what’s on sale and it also forces you to be frugal during the week.
Only the 1.5 liter bottles for us these days. With any luck, they last 3 days. Can get something drinkable for $12 or $13 in that size!
I’ve discovered the joy of boxed wine. There are some good table wines and a box that’s the equivalent of 3 bottles costs $10 to 14. Pouches inside keep it fresh longer too.
My old roommates and I used to keep a couple of boxes of wine in the fridge. The good ol’ days…
WIne cellars and man caves are so yesterday. Today it’s libraries.
Today it’s libraries.
I love my little library! (maybe one of the biggest private American libraries in Rio) but probably not…
Before I moved down here my city library would sell their overstocks and such for $1 a hardback and 50 cents a paperback. I went there every week for almost two years to see what they had of interest.
I scored. Not only do I like reading them, but sometimes when I’m feeling blue on Brazil, I like to go and just look at those books because all those English words looking back at me are pretty cool.
Personally, I’d rather not buy a book unless it’s a worthwhile reference. I do my copious amount of recreational reading via what I borrow from the public library.
I’d rather not buy a book unless it’s a worthwhile reference. I do my …reading via what I borrow from the public library.
I agree, I did too. You guys are very lucky. I knew I wouldn’t have that option for a few years. Finishing “Goldwater” and “Huey Long”. Now just try to find those books down here.
Public libraries RULE.
Well, let’s say the average price is a cool million.
Here in Florida, that would carry an average ANNUAL property TAX of about $25,000, not to include Insurance and Maintenance.
So, just for the cost of the taxes, you could buy: 25,000/365= $68 per day = a cheaper bottle of whine every day, if you just could get out of that debt trap.
The $300 cult cabernet is dying.
http://www.latimes.com/features/food/la-fo-cultcab4-2010feb04,0,3672344.story
That is truly an economic indicator. I have an uncle who has been in sales all his life. I watched him go from company to company over the years, finding the latest “hot” thing before it fell out of fashion. He even sold bottled water for a while.
He once said, when abandoning one product line: “when they start to hit the flea markets, then the prospect of getting any new business is pretty much gone”. Paraphrase. It took me years to understand his methodology, but it proved prescient.
The Fake Jobs numbers just came out.
“Unexpectedly Good”
imagine that.
Actually they admitted that low job losses were higher than expected. The decrease in the unemployment rate was because of people giving up the search because they are depressed about lack of interest.
I think ex-employees are being hired as “freelancers” without health benefits. According to the household survey, the number employed went up on a seasonally adjusted basis including the self employed, while the payroll employee figure went down.
My cousin is like that…
He was recently laid off from his day job of 10 years, but he also plays in a band on most weekends. (the band is strickly for fun as he makes maybe $50/night)
So he’s both ‘laid off’ and ‘employed’. I think a lof of people these days are probably being double-counted.
The lack of good options in health benefits is what really rankles me about freelancing. But I’ve pounded that lectern here before.
BTW, I’m about to write a Freelance Switch article about crummy freelancing deals. Such as being hired back as a freelancer, but without the benefits. Happened at an ad agency here in Tucson last year.
I’m telling ya, they gave up looking for work to so they could go househunting and snap up all those sweet deals.
Right now the gov’t (read: banks) needs us to buy houses more than they need us to work. Come on, ‘Merikuh - sign up for your 99 weeks and go get in on that $8,000 tax break!
Real patriots luv debt!
edgewaterjohn,
Been through something of a transformation lately.., haven’t you? Love it. Yes, we ‘do’ have Oregonians that have been on the unemployment system for 92 Weeks of Benefits I’d read recently.
One of the wife’s former co-workers was among the first casualties and AFASK that gal is -still- collecting benefits.
Well, gee whiz, if she can just get in Section8 housing and get her some food coupons and free medical, she can be “retired”, like some many “disadvantaged” people collecting life-long benefits. It’s great. 92 weeks? Well that’s nearly 2 years.
I think that is what government is for……give us all free stuff and “benefits”. Hail Obama!
she needs to get on SSI for all that. Is she morbidly obese - ? That’s the ticket.
I figure the unemployment rate drop is due to people going back to college. If you go to college full-time, you can continue to draw your unemployment benefits, even if you are not looking for work.
How many people are getting paid (unemployment checks) to not be looking for work? That can skew the numbers quite a bit.
It could be fully explained by “discouraged workers” — that is, people who used to work but dropped out of the labor force.
For example, suppose that last month there were 13m unemployed and 130m in the labor force. Then the UE rate was 10 percent, right?
If 1m subsequently dropped out of the labor force, then with no change in the number unemployed, this month’s UE rate would be
reported at (13m-1m)/(130m-1m) = 12m/129m = 9.3 percent — get it?
This is just a made-up example, but hopefully it gets the point across that the UE rate numbers are a sham due to the discouraged worker statistical lie.
I agree with you, Professor.
I was just making the point that this is the first time I can remember the government extending unemployment benefits to people who are laid off (and previously looking for work) but choose to enroll full-time in college. Essentially, these students are getting paid by the government to remove themselves from the ‘looking for work’ pool.
Yes, the discouraged worker statistics are a sham, especially given all the tricks employed during this Great Recession.
If they really are fake to the high side, then I expect “worse than expected” jobs numbers to come…trend reversion is a b!tch.
The inflated stock market will probably sky rocket two hundred points today. Knowing the fundamentals and the mood on main street, one can only assume all this stock market and financial numbers crap they are putting out is fake..designed to get as much of your money out of your pocket as possible..
Nah — the bovine herd smells future Fed tightening in that falling UE rate. It will take all the virtual paper in the electronic printing press to hold the Maginot Line at DJIA = 10K today…
Truly scary this BS “prediction” came so close…
I’ll believe we have a true employment situation turnaround when this number turns around.
As it is - its rise continued unabated in this report.
That is a truly amazing graph. Can you produce a corresponding graph of the number of discouraged workers? I am thinking there must be some kind of structural statistical relationship between discouraged workers and the duration of unemployment…
I think that would be U-4, which is U-3 plus discouraged.
It was down today, like U-3 and U6. In general all the U-x numbers are very sketchy, and subject to lots of hard-to-measure variables (like birth/death rates, etc.). However the duration is a lot easier to measure, and thus (my impression at least) a lot more accurate, and thus IMO a lot better actual indicator of the true situation.
However - that being said - one factor in the duration is that benefits have been extended. So there’s a good chance that there are simply are larger percentage of people getting laid off that are simply waiting longer until their benefits run out before getting a new job, thus this may not actually indicate a truly higher unemployment rate. Not sure though.
“Unexpectedly Good.” You mean like the difference between a 2 car wreck or a pileup?
For most states, even with the federal UE extension, the max length of time you can collect UE is one year.
That year is over. But the mass layoffs haven’t stopped. This is creating hard to define UE numbers.
Is this none other than a relief valve to try to relieve political pressure to break up Megabank, Inc? What other useful purpose would this fee on TBTF AIG possibly serve?
In case I forgot to mention it, my personal preference is to break up TBTF financial institutions, as otherwise the need to bail them out again may arise during the next “worse than expected” financial crisis which “nobody could have seen coming.”
Geithner attacks AIG’s ‘outrageous’ bonus pay-outs
By Tom Braithwaite in Washington
Published: February 4 2010 02:00 | Last updated: February 4 2010 02:00
Tim Geithner, US Treasury secretary, sought to channel congressional anger at bankers’ bonuses yesterday as he criticised payments at AIG as “outrageous” and the insurance group’s travails as “an outrageous failure of policy”.
Under fire from some Democrats in Congress, Mr Geithner gave a punchy performance at a hearing of the House Ways and Means committee, telling lawmakers to approve a $90bn fee on the largest banks.
“What happened in AIG was an outrageous failure of policy,” said Mr Geithner as he brought up the matter himself. “As a country we should have never let a company take on a scale of risk that could threaten the stability of the financial system.”
“Now, if you join with us in passing this proposed fee on our largest financial institutions … you’ll be able to say that the American taxpayer will not pay a penny for what happened at AIG,” he said.
…
i really cannot see how anyone can take that DB seriously. he is just a joke as far as i am concerned.
DB = dumb bunny?
You’ll not be personally attacking our chairman of the Treasury like that on this board! Ben!!!!
Was guessing what DB stood for too much of an attack?
no…a type of bag.
perhaps DB…a type of bag was a little too harsh.
i think perhaps a type of parrot would be more appropriate…a norwegian blue to be exact.
http://www.youtube.com/watch?v=npjOSLCR2hE
Make Way for the Dumb Bunnies
What were we just talking ’bout a day or so ago: “administration + salary”?
Filed under: The “leave-no-school-administrators-salary-under-funded” behind Act. …or…Little House on the Prairie’s Laurel Engels gets the “Superintendent” job in Osage County.
Hemet school administrators defend $700 car allowance amid budget cuts:
Thursday, February 4, 2010 By BRIAN ROKOS The Press-Enterprise
“All they are giving back is (the equivalent of) their tax-sheltered annuity,” Hemet Teachers Association President Jerry Hall said. “They are not giving up any of their base salary. And that is what is really bothering teachers.”
Administrators say the $700 barely covers the cost of maintenance and traveling through and outside a district that includes remote Anza and Idyllwild.
“(Expenses) would well exceed the money I receive from the district,” said Superintendent Phil Pendley, whose base pay is about $210,000.
Pendley said he does not take advantage of a provision in his contract that, in addition to the $700 allowance, would reimburse him for mileage outside a 25-mile radius of the district office. He said he drives a 2006 Toyota Tundra.
Vince Christakos, assistant superintendent for business services, says he drives his 2002 Mitsubishi Montero on district business at least three times a week. His car has 150,000 miles on it. “I’m hoping to get 300,000 out of it,” said Christakos, who makes $160,000 a year.
Mary Wulfsberg, deputy superintendent for educational services, said she drives to schools at least twice a day. She bought a 2010 Lexus RX350, her first car purchase in 10 years. She makes about $172,000 and said she understands why “people are looking at everything in our contracts.”
LaFaye Platter, assistant superintendent for human resources, said she makes about five trips each week while overseeing middle schools and outlying schools. She makes about $140,000 and drives 2000 and 2009 Toyota Camrys.
Sally Cawthon, assistant superintendent for support services, makes about $133,000 and said she drives her 2009 Toyota Camry hybrid “tons.”
Grossly overpaid government bureaucrats complaining about the lack of “benefits”. The average family income is about 50k.
They have been coddled by government for so long, they haven’t got a clue. Imagine, poor-mouthing about the costs associated with travel and how tough they have it a 3 to 4 times the income of most Americans. They should be canned and replaced and a new salary structure set up.
Those are some world class champion whiners!
IMHO, any move by the Congress to subject the Fed’s (normal) monetary policy operations to public scrutiny is a counterproductive red herring. In a nut shell, the FFR will remain at or near zero for a “longer than expected” period into the foreseeable future — end of boring story.
Much more interesting is the question of what role the Fed played in allocating bailout funds. For example, was the Fed involved in the decision to make Megabank, Inc whole and throw the State of California under the bus?
Geithner backs proposal for improved Fed transparency
Thu Feb 4, 2010 12:02pm EST
Related News
* Geithner says expects China to move on yuan
Thu, Feb 4 2010
* UPDATE 2-Bernanke-Fed must be more open, guard independence
Wed, Feb 3 2010
WASHINGTON, Feb 4 (Reuters) - U.S. Treasury Secretary Timothy Geithner told a Senate panel on Thursday he supports proposals to improve transparency for the Federal Reserve.
“But respectfully not to threaten the independence of it and not to limit the Fed’s capacity to do the essential thing in future crises,” the secretary told the Senate Budget Committee.
Lawmakers are considering opening the Fed’s monetary policy decision-making to congressional reviews. Federal Reserve Chairman Ben Bernanke and the Fed have resisted that change, saying such audits would result in political pressure on Fed interest rates decisions. (Reporting by Nancy Waitz; Editing by Theodore d’Afflisio)
Perhaps it is too obvious to mention, but given that the Fed is a private (but gov’t-sponsored) institution whose primary constituency is Megabank, Inc, it is no big surprise to see bailouts that make the Wall Street bonus pool whole while throwing the California economy under the bus. But it certainly would be enlightening to have a transparent disclosure of the discussion that led to that bailout allocation decision. Among other benefits, this would help the central bankers at the helms of the Fed and the Treasury make progress towards their stated goal of increasing Fed transparency.
Here is another good topic for full disclosure by the Fed:
Feb. 4, 2010, 2:57 p.m. EST · Recommend (4) · Post:
New York AG files civil-fraud case against B. of A.
Former CEO, CFO targeted; bank to pay $150 million to settle SEC charges
By Alistair Barr, MarketWatch
SAN FRANCISCO (MarketWatch) — New York Attorney General Andrew Cuomo filed suit Thursday, claiming Bank of America’s management intentionally failed to disclose massive losses at Merrill Lynch so shareholders would approve the acquisition and then manipulated the federal government for a bailout to save the deal.
…
Here is an example of the problems with handing Megabank, Inc all the bailout money to either stuff under the mattress or pay bonuses: no loans to small business result as a consequence. Wouldn’t it have been more efficient to let banks that went bankrupt go under and start up some new banks with Fed-provided seed money to loan out to small business and households, with the clear expectation of no bailouts for banks that make bad loans?
market pulse
Feb. 5, 2010, 10:12 a.m. EST
Regulators plead with banks to lend to small firms
By Rex Nutting
WASHINGTON (MarketWatch) — U.S. banks should step up their efforts to lend to credit-worthy small businesses, federal and state bank regulators said Friday. “Financial institutions that engage in prudent small-business lending after performing a comprehensive review of a borrower’s financial condition will not be subject to supervisory criticism for small-business loans made on that basis,” the regulators said. The regulators said small business are still having difficulty in obtaining or renewing credit they need to thrive.
Agree.
Fed-Treasury bailout allocation strategy:
- Allocate bailouts at the point when there is a full-blown crisis underway that threatens the global financial system.
- The emergency situation gives the PPT full discretion to hand the bailout money to Wall Street without the hassle of a public process to determine the allocation.
Bailout pie is rich and yummy! And let the rest of you eat cake…
Feb. 5, 2010, 5:56 p.m. EST
Goldman execs share $45 million in stock bonuses
By Alistair Barr, MarketWatch
SAN FRANCISCO (MarketWatch) — Executives at Goldman Sachs Group shared stock bonuses worth $45 million, according to a regulatory filing by the investment bank late Friday.
…
They must think J.P. Morgan’s stock will only go up from here…
Feb. 5, 2010, 10:50 a.m. EST
J.P. Morgan’s Dimon to get $17 mln in non-cash bonuses
By Matthias Rieker
NEW YORK (MarketWatch) — J.P.Morgan Chase & Co. (JPM 38.01, -0.34, -0.89%) Chairman and Chief Executive Jamie Dimon will receive about $17 million in bonuses this year–but no cash.
Dimon, who has been critical of big pay packages to bankers, will receive roughly equal amounts of equity in the form of restricted stock and options. The board of directors decided that he will receive 195,704 in restricted stock and 563,562 in options, according to a filing with the Securities and Exchange Commission Friday morning.
…
That’s nothing. He’ll blow half that much maintaining his hair.
Was at the bank yesterday, cashing a check … and I was offered, out of nowhere, an $11K limit credit card with the bank. Now I only have one credit card, with a $30K limit, paid off every month, with this bank already .. and they wanted to offer me another?
Are banks still freely offering credit these days? Was surprised …
Citibank raised our credit limit three times since the “credit crisis” began. We pay it off every month, and have never come close to the original limit.
Perhaps they are raising limits on those they know will pay it back/don’t need it, so they can show the govt that they are “extending more credit.” It’s a mystery.
“Perhaps they are raising limits on those they know will pay it back/don’t need it, so they can show the govt that they are “extending more credit.” It’s a mystery.”
Nope, it’s not a mystery. You hit the nail right on the head. If they increase your credit line by 10K; knowing that you’re never going to use it, they’ve placated the government (extended more credit) and haven’t increased their risk much/at all. If you need a loan; good luck. If you don’t need a loan, they will be happy to give you the capacity to take on more debt (because they know you won’t do it).
The banks are increasing their own FICOs.
Are people still allowed to rent-out their FICO scores? I can see a business opportunity offered to those, say, on their death beds with high FICOs.
A cash-out of a high FICO could be left to heirs.
combotechie,
Probably already happening. During the height of the boom, there was some outfit Ben featured here in LV that “rented” you assets so you could show a sizeable deposit in your bank acct. so you could continue to get no/low doc loans.
Recently, the Oregonian ran an article of a couple trying to snap up a short sale and mentioned the couple walking from their SW Portland home had -already- purchased another home back in Cali ( where they were presumably from )
My first guess was that they used a friend or relatives credit to do so?
I too, was recently offered a CC by the teller of my bank while cashing a check. My CC is with a different bank and I’ve had it 20 years. But my current bank (4 years) had flagged me for a pre-approved CC.
I inquired and was told the interest rate would be prime +3.99%, with no interest the 1st year on purchased or cash transfers.
Since both my CC company and my wife’s CC company recently raised our interest rates, I ended up taking the new card with my current bank. We’ve stopped using the old CCs except for for the rare use to keep them active.
(note - my mortgage is with my current bank (never sold) as are my checking and local savings accounts. We are considered ‘platinum’ members.)
Press Release 02/05/10:……………..For Immediate Distribution…………………………
HouseBubble Records presents the new Hit CD: TARP II (The Other Covers)!!
Featuring:
Shorn in the USA
Maybe It Appraised
(Lit) Candle in the Bin
Another Kick in the Ba!!s
Voodoo (economics) Child
The Last Drop is the Steepest
The First Time Ever I Sold Your Place
How Deep is your House
My Sweet Landlord
Drywall Keeps Falling on my Head
Return to Lender
Wish Dues Were Beer
We Got No Meat
We Will Cold-Cock You
Turn on the Water
A Whiter Shade in Jail
DON’T WAIT!!! ORDER NOW AND RECEIVE BONUS TRACKS!!!!!!!!
More Than a Reaming
Man! I feel like a Moron
Que Sera, Sera (whatever will be will bite)
AND INCLUDES THE BRAND NEW, CHART CLIMBING, MEGA HIT!!!
Ain’t Too Proud to Bail
Available exclusively at Wall Mrt or by phone. International call center operators standing by. Manufactured in China (PRC). Artwork: CalifornWorld Design, Hong Kong. Inserts printed in Malaysia. Recorded at RedWhite&Blues Studio, Mumbi, India using contract musicians, singers and production crew. Mixed and Mastered by Lakshman (Cracker) Priyadharshana, Capital Studios, Colombo, Sri Lanka. Copyright 2010 American Patriot Productions INC, Cayman Islands.
Disclaimer: Purchasing this product releases manufacturer/distributor from any and all liability of, but not limited to, manufacturer’s use of child labor, unlawful discharges into the environment of hazardous materials or product found to contain any toxic materials including lead, heavy–metals, mercury, MSG, bio hazards, drywall residue or formaldehyde. Wash hands thoroughly after each product handling. Seal CD case with included duct tape strip when not in use. Avoid touching face with hands. Always cough or sneeze into bend of elbow.
Are they available for 99 cent downloads @ Apple?
I already bought this from Walgreens and I can’t get the plastic off. It does glow in the dark as a surprise bonus.
I’d buy it just for “Drywall Keeps Falling on My Head” and “More than a Reaming”. Can’t wait for Vol. II !
I love all of it. A brilliant work of art. The disclaimer is awesome - just wish I could open the fricken’ thing.
As a DJ…I would highly recommend this 5 stars!!!! …and heck I will even play it on my radio show…send me 50 copies willyahhh …
That was awesome, Rio!
Did you come up with that yourself? Very creative.
Did you come up with that yourself?
Yea, I guess I had some extra time on my hands, lol , thanks CA!
I love all of it. Thank you pbb!!
Thanks DJ, DinOr, Hwy and thank you Ben for the great blog.
I am so sick of this fake recovery. It is like we are all lost in a dark tunnel, and the government keeps teasing us by sending a guy ahead and having him turn on his flashlight.
No worries, Obama has pledged to tax the hell out of those with productive jobs and use the money to create and subsidize meaningless positions, while at the same time curtail banks’ ability to generate profit to provide necessary capital to fuel any recovery with the result of eating away at American’s retirement savings and destroying any meaningful job recovery. No one can be this dense. You have to assume it is a carefully thought out plan to destroy the US.
“Obama has pledged to tax the hell out of those with productive jobs and use the money to create and subsidize meaningless positions, while at the same time curtail banks’ ability to generate profit ”
Natalie you slay me. The poor banks just haven’t been able to generate a profit. They’ve been honest and responsible and Obama is crushing them. Bankers are starving on the street, they just can’t get by with those record bonuses.
The “banks’ ability to generate profit to provide necessary capital to fuel any recovery” has been destroyed by Obama.
Never mind that they aren’t lending with the huge piles of cash handed to them. We know that if the gov had just kept their hands off, and had no TARP or FED free cash that the banks would be in perfect shape??????????????
You might be right that there is a plan to destroy the USA, but if there is it is coming from the banking elite who want to destroy the middle class in this country. The facts speak for themselves.
“while at the same time curtail banks’ ability to generate profit to provide necessary capital to fuel any recover”
Natalie, I don’t know if you’re a fan or have perhaps heard of Peter Schiff? He has called this meltdown pretty much to a ‘t’ and I think what he would share is that, we’re -already- up against the limits of leverage and debt.
Even assuming the banks were willing to lend, whom would they lend it ‘to’ that isn’t already technically insolvent or are already deeply mirred in debt? Would said loans go toward growth industries ( or simply put a band aid on bridge loans etc. )
Natalie, at which income do you draw the line between “actual producer of goods and services” and “welfare queen on the government dole?” Remember, there is no grey area in the middle.
Personally, I think Obama’s $250K figure is a good separator. Everyone above it is a welfare queen on the government dole.
What they need to do is go after bonus payments made in stock. The CEO class has written in that they pay capital gains tax rates on income that is earned for work. The Hedge fund guys pay like 1/3rd the rate I pay and pull in millions a year. The alternative minimum tax keeps hitting the middle class while those at the top escape it’s bite. Inflation kills the middle and lower class and is the greatest stealth tax of all. They propose taxing insurance plans another hit to the middle and upper middle class.
Great post, measton.
“No worries, Obama has pledged to tax the hell out of those with productive jobs and use the money to create and subsidize meaningless positions, while at the same time curtail banks’ ability to generate profit. ”
Oh that’s right it’s been the poor banks who have been suffering because of that stingy Obama. What planet are you from?
Obama is hurting the bank “profit (needed) to provide necessary capital to fuel any recovery with the result of eating away at American’s retirement savings and destroying any meaningful job recovery”
Seems to me banks have been sitting on cash, investing in treasuries, and paying large bonus checks. They have not been lending despite the overly generous gifts from the tax payers, and of course those at the bottom who only pay federal taxes through inflation.
Still upset about the bath you took in the stock market?
My thoughts exactly.The lies and corruption are getting real old.
A tunnel? Nope, more like an endless cave (maybe kind of like Crystal Cave, but not as interesting):
Geologist Juan Manuel García-Ruiz calls it “the Sistine Chapel of crystals,” but Superman could call it home.
A sort of south-of-the-border Fortress of Solitude, Mexico’s Cueva de los Cristales (Cave of Crystals) contains some of the world’s largest known natural crystals—translucent beams of gypsum as long as 36 feet (11 meters).
Google it, it’s amazing!
Yeah BEAUUUUUtiiiful!
(our family trip to Denver last summer included a day at the gems exhibit at the Colorado Natural History museum.)
That is amazing.
“Employers unexpectedly cut 20,000 in January, but the unemployment rate surprisingly fell to a five-month low of 9.7 percent, according to a government report on Friday that hinted at some labor market improvement starting to take root.”
According to the MSM headlines, the unemployment rate ’surprisingly dropped to 9.7%, hinting at recovery’.
Of course, the idiotic assumption that everyone who has been unemployed for more than 2 years no longers “counts” as unemployed is what produces the asinine result.
Continuing this lack of logic, in a few years there could be only 500 employed people in the US, but the unemployment rate would be “0.00%”, because everyone else would be out of work for more than 2 years and automatically put into the category of “discouraged job seeker”.
Reuters - “A sharp increase in the number of people giving up looking for work helped to depress the jobless rate. The number of ‘discouraged job seekers’ rose to 1.1 million in January from 734,000 a year ago.”
“A sharp increase in the number of people giving up looking for work helped to depress the jobless rate.”
This is why I love this blog.
Ha ha ha!!!
Just for grins, I did some maths on the airplane ride home last night:
x = true # of unemployed workers
y = true labor force (potential workers)
d = “discouraged workers” (those unemployed who are young enough and qualified enough to work, but who gave up looking since there are no jobs)
U_true = x/y = true unemployment rate
U_fake = (x-d)/(y-d) = fake unemployment rate
Here is an illustrative example (just pulling these numbers out of my arse, but please use the real numbers if you have them)
x-d = 14m
y-d = 140m
U_fake = (x-d)/(y-d) = 10 percent
U_true = 20 percent
d = ?
Trying math before 7a may result in a headache plus wrong answers. Here are some better numbers:
x = 27m
y = 135m
d = 15m
U_fake = (x-d)/(y-d) = 12m/120m = 10 pct
U_true = x/d = 27m/135m = 20 pct
Of course, I just made these numbers up for illustrative purposes.
Ugh!! x/y = 27m/135m = 20 pct (I need an edit key to post math, apparently…)
This was completely expected…
U.S. Jan jobless rate falls to 9.7%, low since Aug
WASHINGTON (MarketWatch) - The unemployment rate fell in January to 9.7% from 10% in December, the Labor Department said Friday. Nonfarm payrolls contracted by 20,000 in January. Economists surveyed by MarketWatch had expected a 25,000 gain and for the unemployment rate to remain steady at 10.0%. Under the revisions released today, job losses since the start of the recession in December 2007 totaled 8.4 million. This was in line with expectations.
Capitol Report
Feb. 4, 2010, 10:45 a.m. EST · Recommend (13) · Post:
Massive revision will show recession was even worse
More than 8 million jobs lost since 2007, updated Labor data will show Friday
By Rex Nutting, MarketWatch
WASHINGTON (MarketWatch) — On Friday, the government’s official data on U.S. employment will be updated to reflect what everyone already feels: In terms of job losses, this has been the worst recession since the end of the World War II more than 60 years ago.
Instead of job losses of 7.2 million as currently reported, it’ll be more like 8.1 million lost jobs, if the annual benchmark revision of payrolls through March 2009 comes in as had been estimated four months ago by the Bureau of Labor Statistics.
…
Isn’t this how the unemployment numbers always work?
Yes. My point was to explicate the Lies, Damned Lies and Statistics nature of the headline unemployment rate calculation.
The goverment is learning from Wall Street: great manipulation of numbers!
Economy Sheds 20,000 Jobs But Rate Drops to 9.7 Percent
U.S. payrolls unexpectedly ell in January, but the unemployment rate surprisingly dropped o a five-month low, according to a government report Friday hat hinted at labor market improvement.
The Labor Department said the economy shed 20,000 jobs after losing 150,000 jobs in December. November was revised to a gain of 64,000, up from 4,000. Annual benchmark revisions to payrolls data showed the economy has purged 8.4 million jobs since the start of the recession in December 2007.
——————–
you shrink the job pool by say 1 million and presto, a 20,000 loss becomes a 980,000 gain. Pretty sneaky
I expect “worse than expected” jobs numbers going forward…
It’s funny how cnbc is always saying the numbers were better than expectations.Whose expectations are we really talking about?Certainly isnt main streets expectations.The game is so crooked these days that it is becoming hilarious.
I wonder what it feels like to be paid to spew BS?
I know, I’m not spewing any more BS for free. I will hold out as long as I can, but it is going to be hard.
Come on — admit it: Freely spewing BS is fun!
I wonder what it feels like to be paid to spew BS?
I’m sure they’re laughing all the way to the bank.
Spewing BS pays Megabank buckaroos — just ask the members of the MIA HBB lending industry PR consulting tag team…
Bay Shipbuilding lays off 116 workers
Journal Sentinel ~ Feb. 4, 2010
Bay Shipbuilding Co. of Sturgeon Bay told state authorities Thursday it will lay off 116 employees beginning in early April.
The firm said the layoffs will be in addition to those it announced last August. Bay Shipbuilding said then that it planned to lay off up to 405 employees at the end of October.
Company executives could not be reached late Thursday afternoon.
A subsidiary of Italy’s Fincantieri-Cantieri Navali Italiani S.p.A. bought Bay Shipbuilding and Marinette Marine Corp. in early 2009 from the Manitowoc Co.
In its notice to the state this week, Bay Shipbuilding said it is trying to mitigate the planned layoffs “by aggressively seeking new business.”
Global maritime shipping is down, hence layoffs in the shipbuilding industry.
Look for similar happenings regarding railroads and trucks.
and thus Warren Buffet is out trying to sell bonds. Needs cash to keep his sinking investment afloat.
I was wondering about this guy. He’s old and his days are numbered. Why doesn’t he just hang it up and spend more time with his grand children?
And of course, I know the answer. He’s “wired’ this way. He’ll probably be making deals until the day he drops dead.
Buffett is such a workaholic that his wife, Susie, left him and moved to San Francisco. He’s also had strained relationships with his children.
I wouldn’t write that off just yet. BNSF is arguably the best run of all the US railroads. They have the shortest/fastest LA-Chicago route, and they are just about to finish up “double tracking” the LA-Chicago mainline.
New Panama Canal notwithstanding, the NIMBYs, Longshoreman’s Union, etc. will keep any kind of expansion of East Coast ports to a minimum.
Is the cash to finance BNSF? Or is he looking to acquire CSX or Norfolk Southern? A merger between an eastern and western railroad would be where the REAL efficiencies would come in.
(just my uneducated opinion, but I’d vote for a BNSF-NS merger)
There is no denying that coal shipments and goods are down. The middle class US consumer will continue to slide. Food and exports might pick up but I just can’t imagine it makes up for the bubble. We’ll see he’s got a long track record. I agree that rail will play a much bigger role in shipping as oil prices rise. That’s the arguement for this.
Do you think there would be any monopoly issues regarding merging rail lines?
Just my semi-educated opinion:
Two of the east west lines will merge eventually, then the other two will merge with each other, or CN, as a defensive measure.
If I had a bunch of money laying around, I’d have bought KCS last spring. Only a matter of time before it becomes a merger target for UP-BNSF-CN, or (less likely) NS or CSX.
A BNSF-NS merger would be a real problem for UP and CSX, or both. From past history, both seem to be able to handle mergers better than UP (especially). For starters, it could make a UPS package schedule of Monday afternoon pickup/Friday morning delivery on the opposite coast for ground shipping very do-able. They could bypass a lot of traffic around the the Chicago bottleneck.
As long as there are two competitors, for the traffic, the government won’t care much. At least they didn’t care when the aerospace business was shrunk down to Airbus-Boeing on the commercial side, and Boeing-Northrop Grumman-Lockheed Martin on the military side.
California luxury home market bailout tragedy: Only “lower priced” homes (those requiring loans in amounts below $729,750 to fund their purchase) qualify for FHA (govt-guaranteed, low downpayment) financing.
How do Midwestern folks feel about chipping in to fund government guarantees for “low-priced” California housing (funded by purchase loans up to $729,750)? Am I the only American who finds this increase in the conforming loan limit patently insane?
REAL ESTATE
Million-dollar homes in California suffer further sales drop in 2009
The number sold in the state falls 23.8%, to 18,621 from 24,436 in 2008, for a fourth year of decline in a row.
High-priced homes
The decline in sales of high-priced houses in California, according to real estate research firm DataQuick, was the result of buyers holding back, a weak market for big loans and the drop in home prices over the last several years. Above, a house in San Francisco. (Justin Sullivan / Getty Images / January 26, 2010)
* Related
* Index of pending home sales edges up Index of pending home sales edges up
* Outlook for housing market is muddied by minuscule rise in prices (Sounds to Professor Bear’s jaundiced eye as though the market has reached a permanently higher plateau…)
By Alejandro Lazo
February 5, 2010
Sales of California homes priced at $1 million or more tumbled for a fourth consecutive year in 2009, according to a report released Thursday.
The number of million-dollar-plus homes sold dropped 23.8% to 18,621 in 2009 from 24,436 in 2008, according to San Diego real estate research firm MDA DataQuick.
The decline was the result of buyers holding back, a weak mortgage market for big loans and the drop in home prices over the last several years, dragging the value of many houses below the $1-million threshold, DataQuick said.
“Prestige home sales are a unique sub-category of the real estate market. The buyers and sellers respond to a different set of motivations,” DataQuick President John Walsh said. “In the multimillion-dollar price ranges, decisions are largely discretionary and aren’t as dependent upon jobs, prices and interest rates the way they are for most buyers and sellers.”
The trend underscores the nature of the state’s housing recovery. Sales of California homes at all price levels increased 16.9% last year, to 460,166 from 393,703 in 2008. One in 25 homes sold for $1 million or more last year. The year before it was 1 in 16.
Lower-end homes largely fueled last year’s buying spree as investors and first-time purchasers sensed opportunity in steeply discounted foreclosure properties across the state.
The Federal Housing Administration, which insures mortgages often used by first-time buyers with small down payments, has played a big role in supporting the market for lower-end properties in California and some move-up markets.
In higher-priced California communities, such as Los Angeles County, the limit for FHA loans was increased to $729,750 from $362,790 less than two years ago.
But more-expensive homes haven’t enjoyed that same level of government support, nor were they hit as hard by the subprime mortgage meltdown.
…
“How do Midwestern folks feel about chipping in to fund government guarantees for “low-priced” California housing…”
It’s the non-recourse loans out there, along with the tax foregiveness on loan defaults, that really irk us.
Here in Ohio, houses appreciate less than the rate of inflation, whereas in CA they have been appreciating at +2% over inflation for the past 50 years. They reaped a lot of rewards that we did not. But like so many things in this country these days, the profits are privatized but the losses are not.
I think all states should move to a non recourse status. Then force banks to keep a certain percentage of their loan portfolio to maturation. Then force CEO’s to have their bonus payouts made in stock options that can’t be exercised until the loans made mature, and they can’t be sold without a huge tax penalty.
This would improve loan quality 1000%.
No more no docs
No more 0% down
No more exloding ARMs
measton I suggested that the other day, only slightly different: Just require that all loans be seasoned for two(?) years at full amortization before selling them off. That would pretty much make the other regs unnecessary. If a CEO can make big profits from that system, then frankly I think he deserves his bonus.
Just make the CEO personally liable for any mortgages that go into foreclosure, with debtor’s prison awaiting bank CEOs whose loans prove too underwater to ever repay them.
Problem solved…
Just make the CEO personally liable
Yes!! You’re catching on! But don’t forget the directors and shareholders who are supposed to be supervising the CEO. They should all also be jointly and severally liable.
“They should all also be jointly and severally liable.”
Now we’re getting somewhere. Hopefully someone in Congress or who knows someone in Congress is listening…
To understand why we have the policies we have, follow the money:
http://www.opensecrets.org/industries/recips.php?cycle=2010&ind=F10
End to SBA loan subsidy sought
Business First of Buffalo 2-3-10
Huge losses in the Small Business Administration’s main loan program have led President Barack Obama to propose phasing out the government subsidy for 7(a) loans beginning in fiscal 2012.
This would force the agency to support its government-guaranteed loans by charging higher fees on borrowers and lenders.
The economic stimulus bill provided the SBA with an additional $375 million to waive fees for borrowers on most 7(a) loans and 504 loans, which mostly finance real estate, and increase the government guarantee on SBA loans from the typical 75 percent to 90 percent.
Those enhancements made the loans more affordable for borrowers and less risky for lenders, enabling SBA lending to rebound after cratering during the financial crisis.
To hell with small bitness, big bitness is where it’s at! Just ask gubmint and GS.
DJIA = 10K or bust
Looks like a bust at the moment, but I expect a rally to above 10K by close, as the DJIA = 10K support level is too psychologically important to let it slip away…
That was quick
No worries, Eddie assures us we’re looking at Dow 12K by June.
Given how “sticky” the DJIA is around 10K, even on days like today when Mr Market would prefer to hammer prices, I don’t see why support levels could not be gradually ratcheted up between now and June from 10K to 12K. I am thinking maybe I had better park more money in the stock market, just in case…
Dumb hunch: Given the stock market’s recent (and current) selloff, can another leg down in home prices be long to follow? My understanding is that the stock market is a leading indicator for the economy, and by extension, for housing…
Near bull’s eye:
10,012
Change
+10.05 +0.10%
Volume
Volume 308.32m
Feb 5, 2010, 4:02 p.m
Comment on bear market investing:
1) It is generally far more pleasant than walking through a mine field, as investors normally don’t die when an investment blows up.
2) Diversification allows you to reduce your losses by spreading them over many asset classes. That way, if one asset class explodes, your entire portfolio is not blown to smithereens.
Do you realize that there is a guy, probably a Goldman employee, whose job is to keep the Dow above 10k today? The stock market today has the credibility of the WWF. (as does our government). Idiocracy.
If that’s the case, it sure looks like he is gonna fail in his efforts…
I stand corrected, shocked and awed.
Countdown to the close: 0:02:58
Dow reclaims 10,000
Not a guy, but a computer program.
Gold bubble, we hardly knew thee…
Carry trade unwind…
“Gold bubble, we hardly knew thee…”
They’re tryin’ to take me lucky charms!
They were tryin’ to take my gold fillings
Cash4Crunkers
There are always “alternatives”…
NEW YORK (AP) — Oil prices fell Friday for the third straight day, weighed down by a stronger dollar and persistent doubts about the health of the global economy.
Imagine what will happen when our interest rates start to edge up……someday.
UPDATE 3-China to levy anti-dumping duties on US chicken
Feb 5, 2010
BEIJING, Feb 5 (Reuters) - China will levy heavy anti-dumping duties on U.S. chicken products, its Commerce Ministry said on Friday, a move likely to aggravate trade relations and antagonise one of the few U.S. industries that profitably exports to China.
The ministry’s initial investigation showed that U.S. companies had dumped chicken products into the Chinese market, according to the ministry’s website (www.mofcom.gov.cn).
Excellent — means more affordable chicken for US consumers!
Yes, more affordable chicken feet; beaks and claws for the masses!
Yet more protectionism.
Does anyone besides me see this as potentially very inflationary down the road? Think about how much stuff we get from China and Japan now - what happens when these countries start to just cut us off?
All manufactured goods will rocket higher, oil consumption will tank.
We get out jobs back?
Quite frankly, I’d love to see an end to imported junk. We used to make great things that lasted. Now, everything is made of toxins and plastic. Good riddance!
“one of the few U.S. industries that profitably exports to China.”
They can produce 1.3 Billion people…but can’t breed enough chickens.
Radical:
“How tough is it?”
LECH WALESA (via translator): The United States is only one superpower. Today they lead the world. Nobody has doubts about it, Militarily. They also lead economically but they’re getting weak. But they don’t lead morally and politically anymore. The world has no leadership. The United States was always the last resort and hope for all other nations. There was the hope, whenever something was going wrong, one could count on the United States. Today, we lost that hope.
Did he say this on Obama’s innauguration day? Or was it on one of the other new lows of our nation.
Was this discussion in any particular context, or was he making blanket statements for no special reason?
wmbz = he posts…you find.
wmbz, what happened “today” where Lech lost hope?
whenever something was going wrong, one could count on the United States.
Too many people in the world are looking for the U.S. to “help”. Did anyone else see where a majority of the people of Haiti wanted the U.S. to just come and “take over”? I sure wish I had a rich uncle that would just “take me over” and take care of my every need.
The world sucks…where is the rest of the socialist Europe? I say, go get ‘em!…Haiti, Somalia, Africa….Take em all in! Oh? Why not?
You’re confusing me today.
Haiti- Poor, uneducated country, within swimming distance of the US with a corrupt central government. Average “Jacque6Pac’ ” wants us there.
Afghanistan- Poor uneducated country, halfway around the world, with a corrupt central government. Nobody wants us there.
We’re in Afghanistan for the forseeable future. We’re baling out of Haiti at the first opportunity.
It must make sense to someone.
We would have been better served if we had stayed in Afghanistan just long enough to bring OSB’s head back on the end of a long stick, then gotten the hell out.
Our extended stay over there has just given our opponents their own Fort Irwin to test ways of neutering/hindering our vaunted green machine, and given our Army the equipment and OJT on how to quell an insurgency.
I forgot to add to both Haiti and Afghanistan: “….with out of control gangs running around, hacking people up.”
If you’re still wondering about yesterday’s gold-dollar price action:
Not only did it fail to maintain its value during the market maelstrom Thursday, gold’s price plunged nearly $50 an ounce, or almost 5%. That dumping of the precious metal — whose only true function is as adornment and as a store of value — indicates a scramble for liquidity.
By all indications, that rush was to unwind so-called carry trades, which consist of borrowing dollars to fund purchases of other, presumably higher-returning assets. And with U.S. interest rates near zero, the allure of the carry trade is well nigh irresistible.
That means carry traders effectively are short the dollars they borrowed to buy commodities, emerging-market stocks, junk bonds, which beckoned with higher-potential returns. When those positions start to go against the carry traders, the leverage turns painful.
As they scramble to unwind the positions, they not only dump those risk assets, they also have to cover what is effectively a short-dollar sale to pay off that liability. With so many carry traders all making for the exit, there’s a squeeze, sending the dollar still higher and exacerbating the pain.
Ranadall W. Forsyth, Barron’s: The Margin-Call Market Rout
Yep. I got out of all our dollar hedges in October. Too many people were talking about being short the dollar/hyperinflation worries. Time to exit that position.
“Those that can make you believe absurdities can make you commit atrocities.” ~ Voltaire
Was he talking about religion?
Either that or banking, and some times it is quite hard to tell the difference…
“TrueBeliever’s™ / TrueDeceiver’s ™” …verse’s…Volitaire’s rebuttal with clarity & “Style”:
The 1755 Lisbon earthquake, also known as the Great Lisbon Earthquake, took place on 1 November 1755, at around 10:24 in the morning. The earthquake was followed by a tsunami and fires, which caused near-total destruction of Lisbon in the Kingdom of Portugal, and adjoining areas. Geologists today estimate the Lisbon earthquake approached magnitude 9 on the Moment magnitude scale, with an epicenter in the Atlantic Ocean about 200 km (120 mi) west-southwest of Cape St. Vincent. Estimates place the death toll in Lisbon alone between 10,000 and 100,000 people,making it one of the most deadliest earthquakes in history.
The earthquake had wide-ranging effects on the lives of the populace and intelligentsia. The earthquake had struck on an important church holiday and had destroyed almost every important church in the city, causing anxiety and confusion amongst the citizens of a staunch and devout Roman Catholic city and country, which had been a major patron of the Church. Theologians and philosophers would focus and speculate on the religious cause and message, seeing the earthquake as a manifestation of the anger of God.
The earthquake and its fallout strongly influenced the intelligentsia of the European Age of Enlightenment. The noted writer-philosopher Voltaire used the earthquake in Candide and in his Poème sur le désastre de Lisbonne (”Poem on the Lisbon disaster”). Voltaire’s Candide attacks the notion that all is for the best in this, “the best of all possible worlds”, a world closely supervised by a benevolent deity.
Is this a quote? I vaguely recall something of this nature from A Crack at the Edge of the World…
the post is here: wiki/1755_Lisbon_earthquake
more stuff:
wiki/Candide:
“…Candide has enjoyed both great success and great scandal. Immediately after its secretive publication, the book was widely banned because it contained religious blasphemy, political sedition and intellectual hostility hidden under a thin veil of naïveté.”
“…it contained religious blasphemy, political sedition and intellectual hostility hidden under a thin veil of naïveté.”
Sounds worth reading…
13 Year Old Commits To USC
FOXNY.COM
The next Tiger Woods? The next Lebron James? Everyone is always looking for the next phenom. And that’s why you might want to learn the name David Sills. He is a seventh grader who just gave a verbal commitment to the University of Southern California to be their quarterback - in 2015.
The six-foot-tall 13-year-old is a wunderkind in the eyes of his personal coach Steve Clarkson, who has mentored top college quarterbacks Jimmy Clausen and current USC star Matt Barkley.
The shocking commitment of such a young player is more common in sports that are less physically demanding than football. There is the issue of Sills continuing to mature physically to withstand the punishment of the highest level of collegiate football, but Clarkson doesn’t foresee any problems.
“His skill set is off the chart,” Clarkson said. “I’ve never seen anyone at his age do what he’s been able to do,” he said according to ESPN. He added that Sills breaks down NFL game film as part of his routine.
How is his libido? Apparently a required attribute to athletic superstardom.
If all the fame and attention go to his head, he could very well be the next Tiger Woods.
Which “head?”
The NCAA & NBA scout SUV run into a tree..out fell x9 11 year olds with tattoo’s
Whatever happened to the HBB’s lending industry PR consulting tag team? Suddenly trolls seem to be an endangered (extinct?) species around here…
I was wondering the same thing. I begged Eddie to stay for at least six months. I’d really like at least one to come back, just one.
Sometimes its best to let sleeping dogs lie.
Now don’t start a fight PB. Though I have to admit I enjoy a good verbal fight
Missed the chance to have one in person yesterday afternoon (I was in SF)… may take you up next visit.
I am trying to come up with a timeline for the housing bubble stages of grief. Does this look about right?
2006-2007 SHOCK & DENIAL-
You will probably react to learning of the loss with numbed disbelief. You may deny the reality of the loss at some level, in order to avoid the pain. Shock provides emotional protection from being overwhelmed all at once. This may last for weeks.
2008-2009 PAIN & GUILT-
As the shock wears off, it is replaced with the suffering of unbelievable pain. Although excruciating and almost unbearable, it is important that you experience the pain fully, and not hide it, avoid it or escape from it with alcohol or drugs.
You may have guilty feelings or remorse over things you did or didn’t do with your beloved home. Life feels chaotic and scary during this phase.
2010-2012 ANGER & BARGAINING-
Frustration gives way to anger, and you may lash out and lay unwarranted blame for the foreclosure on someone else. Please try to control this, as permanent damage to your credit rating may result. This is a time for the release of bottled up emotion.
You may rail against fate, questioning “Why me?” You may also try to bargain in vain with the powers that be for a way out of your despair (”I will never borrow money again if you just bring my home back”)
2013-2014 DEPRESSION, REFLECTION, LONELINESS-
Just when your friends may think you should be getting on with your life, a long period of sad reflection will likely overtake you. This is a normal stage of grief, so do not be “talked out of it” by well-meaning outsiders. Encouragement from others is not helpful to you during this stage of grieving.
During this time, you finally realize the true magnitude of your loss, and it depresses you. You may isolate yourself on purpose, reflect on things you did with your lost home, and focus on memories of the past. You may sense feelings of emptiness or despair.
2015-2016 THE UPWARD TURN-
As you start to adjust to life without your dear home, your life becomes a little calmer and more organized. Your physical symptoms lessen, and your “depression” begins to lift slightly.
2017-2019 RECONSTRUCTION & WORKING THROUGH-
As you become more functional, your mind starts working again, and you will find yourself seeking realistic solutions to problems posed by life without your beloved home. You will start to work on practical and financial problems and reconstructing yourself and your life without it.
2020 and beyond ACCEPTANCE & HOPE-
During this, the last of the seven stages in this grief model, you learn to accept and deal with the reality of your situation. Acceptance does not necessarily mean instant happiness. Given the pain and turmoil you have experienced, you can never return to the carefree, untroubled YOU that existed before this tragedy. But you will find a way forward.
Just from my personal experience (in a slightly related issue), I find there was some overlap between the stages. In my experience, the “Upward Turn” and “Reconstruction” overlapped a lot.
Hopefully, the “Anger” stage will be directed toward some of the people and entities that contributed to this mess……and overlap with the “Reconstruction” stage.
Serious question, folks: Am I the only one on this board who finds the above post hilariously funny? Sorry if I have a sick sense of humor and am full of myself…
Satire need to be outrageous stuff, enough to be obvious.
I’ve heard real counselors say the same thing you said, practically word-for-word.
It was funny coming from them too, but they weren’t trying to be funny.
Well gee — obvious ain’t my flavor of humor. I guess that’s why everyone else forgot to laugh but me…
It’s good, and accurate, PB.
2002-2005 DELUSIONAL
In this stage you are cocksure that you made the right move. You reread books by Robert Kiyosaki and Donald Trump. You make your hairstyle the same as Trump’s. You HELOCed your house to buy a plasma TV and a $70,000 Hummer and drive past the pitiful apartment complexes, laughing at the trash who rent them.
In your dreams you hear the phrase “They are not making any more land” and “real estate only goes up.”
You are up to your eyeballs in debt. But it’s okay (see the second phrase above).
BILA - Thanks. That is a good preamble to Prof Bear’s apt description of life after chaos. Wicked funny.
Your house just foreclosed in December, your online business is BK and owes a 320K court judgement to a media services firm. What should you do? If you are Laura Silsby from Idaho you drive a bus to Port-au-Prince and gather 100 orphans from the streets and collapsed orphanages, and go to the Dominican Republic in hopes of opening an orphanage.
http://online.wsj.com/article/SB10001424052748703357104575045794048725562.html?mod=yhoofront
I say keep them all jailed. That is unbelivably reckless to take kids to another country, regardless the situation. But hey, she’s obviously a “beg for forgiveness” type.
I heard audio clips of some of the kids and the parents involved. The one mom was saying she was giving up her child to have a better life, but the ten year old girl was crying, saying she didn’t want to leave her folks.
I agree, the woman who masterminded this fiasco should stay in jail. She obviously was looking to collect adoption fees for these children. As bad a money manager as she is proven to be, who is to say the assistance she would get from various govt. agencies would go to feeding and housing the children, rather than to supporting herself in the manner to which she was accustomed.
The instances of so-called caretakers that steal from the disability checks of their charges are unfortunately too common. I’ve seen it happen to one of my own family members. Ever since this story broke I smelled a rat. They say the Lord works in mysterious ways, well it looks like He sprung the trap on this one.
“Poor”, “Orphans”
All she needed was some “widows” to complete the trifecta.
The local paper is filled with stories about Silsby. Reportedly she is a long-time scam artist.
http://www.idahostatesman.com/102/story/1067267.html
“…Her 16-year marriage to Terry L. Silsby, a real estate agent, ended in divorce in January 2007, according to marriage records.”
Geez, what an opportunity missed to …”turn things around”
These “Prosperity Christians” always say that setbacks are God’s way of testing their faith.
No consideration at all to the possibility that God is telling them they are eff-ups, and they should restrict themselves to endeavors more in line with their skill set.
No consideration at all to the possibility that God is telling them they are eff-ups, and they should restrict themselves to endeavors more in line with their skill set.
Talk about sinners in the hands of an angry God!
The Statesman now says the reports of her building an orphanage in Kuna ID are fake.
http://www.idahostatesman.com/newsupdates/story/1069437.html
On the way to work this am I was listening to NPR and they said something like this
” 1/3 of all mortgages are underwater and the reason more people don’t walk away is because they are bad at math but good at feeling guilty” ” But that’s starting to change now. In Tempe AZ a lawyer specializing in helping people stay in homes is getting calls not asking how to save their home but how to make the Bank take it back”
haha I find this very funny and scary at the same time
Google Grand Junction Free Press for the article, but here it is in its entirety:
Foreclosure sales climb in Mesa County (Colorado)
An avalanche of foreclosure activity resulted in fourth quarter sales rising more than 300 percent in Mesa County when compared with the same period a year earlier.
The Colorado Division of Housing reported Thursday foreclosure sales surged to 157 in the three months ending Dec. 31 from 37 in the same period of 2008. That marked a rise of about 324 percent in the period.
The most recent percentage gain was the highest in the Centennial State for metropolitan counties.
Boulder County ranked second with an increase of roughly 28 percent to 143 from 112 in the same period. Pueblo County rounded out the top three with a gain of about 20 percent in the period.
“I haven’t counted the number of bank properties I am currently dealing with but I know it’s huge,” said David Durham, a real estate agent with Bray & Co. in Grand Junction, on the level of foreclosure activity he is seeing in the region.
Durham, a 28-year industry veteran, added, “I probably (have) 25 to 30 in my inventory. I haven’t seen nearly those kind of numbers since 1984-’85. That is not even including all the stuff that is in the pipeline.”
The Mesa County housing market also posted the highest increase for fillings in the third quarter as those claims jumped 279 percent.
Statewide foreclosure filings increased 14.5 percent in the 12 metropolitan counties that are tracked in the report.
That translated to 9,710 filings in the fourth quarter, up from 8,480 in the fourth quarter of 2008.
The most filings in the fourth quarter of last year were recorded in Arapahoe County at 1,597. El Paso County was next up with 1,364, followed by Denver County at 1,351 in the period.
Looking ahead, the outlook for 2010 is cloudy at best. Ryan McMaken, community relations director for the division of housing, said the first quarter should set the tone for the rest of the year.
He said one of the other things to watch is the “employment” market because a rebound there could bode well for the housing sector.
The foreclosure process generally begins when a borrower is three months behind in his or her payments. At that point the lender typically files a notice of election and demand with the public trustee’s office of the county in which the property sits.
Data are based on foreclosure information reported by the public trustee’s office in each county.
No worries mate…nothing jobs in “natural gas” can’t solve for Western Colorado.
Feb. 5, 2010, 11:25 a.m. EST
Bipartisan financial reform talks at ‘impasse,’ says Dodd
Democratic Senate Banking chairman going ahead with own bill
By Robert Schroeder, MarketWatch
WASHINGTON (MarketWatch) — Efforts to reach an agreement with Republicans over a financial reform bill have hit an impasse, the Democratic chairman of the Senate Banking Committee said Friday, adding he’ll move ahead with a bill of his own.
News Hub:Ex-BofA CEO Charged With Securities Fraud
WSJ’s Rick Brooks discusses civil securities fraud charges filed by New York Attorney General Andrew Cuomo against former Bank of America CEO Kenneth Lewis and former Chief Financial Officer Joseph Price over their handling of the Merrill Lynch acquisition.
Sen. Christopher Dodd of Connecticut said Friday that the committee’s top Republican, Richard Shelby of Alabama, told him Thursday night that he’s still committed to finding a bipartisan consensus on a reform bill.
“But for now we have reached an impasse,” Dodd said in a short statement. “While I still hope that we will ultimately have a consensus package, it is time to move the process forward.”
…
The Republican Plan going forward:
Throw sand in the gears until 2010 elections.
Blame the “gridlock” on Obama.
Reinstitute all the Republican so-called “policies” that screwed stuff up to begin with.
Capital Times
Be glad you are not trying to sell a high-end condo.
A new report from real estate anyalyst Dan Miller of Keller Williams Realty shows it took 573 days on the market — roughly a year and a half — to sell a condo in 2009. That’s an improvement from the the 677 days it took in 2008.
But as Miller observes, the improvements in the market were localized to the lower price categories, as the first-time homebuyer tax credit boosted the market for more affordable condos.
“It’s worth noting the average required marketing time for condos in the highest price categories is a matter of years, not months,” he warns.
Funny to think back a few years when developers couldn’t build condos fast enough and buyers were bidding against each other for the best views.
Of course, for those with cash, what a buying opportunity. Make an offer, any offer.
– Debt: As discussed here weeks ago, sovereign debt is the new subprime. The immediate concern centers on Greece but the fear is this is just the tip of the iceberg. De-leveraging that started after Lehman collapsed continues with painful consequences. As Henry points out in the clip, the global economy is realizing you can’t borrow your way out of a debt crisis.
Investors are responding by once again selling equities and fleeing to the safety of the U.S. dollar and Treasuries, which is ironic since the U.S. deficit as percentage of GDP is similar to that of Greece…
Yes, but Greece doesn’t have military forces like ours.
NEW YORK (Reuters) – The asking price for imprisoned Ponzi schemer Bernard Madoff’s former home in Palm Beach, Florida, has been reduced again.
The 8,750 square-foot (813 square-meter) home is being offered by Corcoran Group for $7.25 million, according to the broker’s website.
The new price is 8 percent below the previous asking price of $7.9 million, and 15 percent below the original $8.49 million asking price.
Corcoran has listed the home for close to five months.
It describes the five-bedroom, seven-bath home, which has a pool and water views, as “a return to classic Florida island living” of the 1950s and 1960s “when Palm Beach was a less manicured tropical paradise.”
Madoff had estimated the home was worth $11 million.
Can’t the gov offer an 1 million dollar credit for these poor people. Oh the humanity.
It describes the five-bedroom, seven-bath home, which has a pool and water views, as “a return to classic Florida island living” of the 1950s and 1960s “when Palm Beach was a less manicured tropical paradise.”
Which is a polite way of saying “unkempt and neglected”.
His place in the Hamptons sold after only a short while on the market, but problems selling were expected. Bernie Madoff’s properties were all well located, but in need of updating. This market isn’t very good for expensive fixers.
Gregory Copley’s 10 Geopolitical Predictions for 2010:
1. The decline in Western asset values will likely continue in the broad sense through 2010, which will automatically lead to a compounded reduction in the asset-based credit available.
2. The West will demonstrably not contest dominance of the major oil and gas fields of Iraq, Iran, Nigeria (and elsewhere in the Gulf of Guinea) against competition from the People’s Republic of China (PRC) and, to a lesser extent, India.
3. The conflict in Afghanistan will become increasingly strained as the US sends out, literally, signals of surrender to the Taliban.
4. India will of necessity re-align with Russia.
5. Myanmar ruling military leaders open to a more Western orientation to the detriment of the PRC.
6. Western leaders will turn to sophistry and intellectual distractions, such as an attempt to assert or blame “international law” as the mechanism for remedying their situations.
7. The unease and conflict in the Arabian Peninsula will continue apace, with strong Iranian support and some Russian interest.
8. We will see transition of power occurring in places such as Egypt and Nigeria in 2010.
9. It is profoundly unlikely that Israel will militarily attack Iran in 2010, or in the foreseeable future.
10. The People’s Republic of China will continue to manage great internal disparities through 2010. The continuing poor economic performance in Japan and the US will continue to constrain PRC exports and dampen PRC economic options given the extent of Chinese holdings of US securities which grow less attractive by the day.
Gregory R. Copley, Editor GIS/International Strategic Studies Association (Australia)
Has no effect on the current a–holes in charge…
Henry Ford said on February 11, 1934:
“Let them fail; let everybody fail! I made my fortune when I had nothing to start with, by myself and my own ideas. Let other people do the same thing. If I lose everything in the collapse of our financial structure, I will start in at the beginning and build it up again.”
Ford… Studebaker…Pontiac GTO …nix, nix, nix…progress: Hyundai/KIA/Nissan
Bonus points just for wmbz…Name the company that first sold “imported” Mercedez Benz in America?
The good old days of corporation failures…
“…When the war ended, Studebaker’s reputation for reliability led to increased sales, and the company prospered until the Great Depression. In 1933, in the depths of the depression, the company went into receivership. Normal practice at the time was to simply sell all of the company’s assets and pay off the creditors as best as possible. Studebaker however, was able to convince Congress that its real value was as a going concern, wherein workers would still have jobs and pay taxes. Bankruptcy law was revised by Congress to let the company put forth a plan of reorganization and repayment of its debts. The company recovered from the depression, and by the late 1930’s was in financial health again.”
You all know how this story ended…a little further on down the road…”
From South Bend, the home of Studie, there were a lot of reasons for the collapse. Believe it or not, people in this town STILL debate the causes, even though the ship went down in 1963.
People in your town need something else to debate.
Like Lehman…the question… who benefited?
NEW YORK (AP) — You know it’s a weak IPO market when a hot technology company prefers Bono to the Nasdaq.
That’s what Yelp did when it raised $25 million in late January from a venture capital firm whose investment team includes the lead singer from U2. The online business-listing service, thought to be a prime candidate for an IPO, now won’t go public until late next year at the earliest.
“We will do an IPO when it makes strategic sense,” Yelp CEO Jeremy Stoppelman said recently.
This was supposed to be the year when initial public offerings made sense again following the worst drought since the 1970s. After all, the Standard & Poor’s 500 is up more than 60 percent since March, and the economy is improving.
But so far, executives at would-be IPO candidates are playing it safe — another sign that this is a bull market that doesn’t feel like one.
That reluctance to go public comes with consequences that go beyond the stock market.
Is this what happens when gov and banking elite poor money into dead institutions in order to prop up the market. New companies can’t find cash.
Well, Bono is an expert at avoiding taxes (especially on the ultra-rich)
+1
Where’s the water Mellon?
From the Huffington Post:
In honor of Black History Month, the NBC cafeteria served fried chicken, collared greens, and jalapeno cornbread today for lunch. The picture below was snapped by Questlove, the drummer for the Roots–Jimmy Fallon’s house band. He was also the musician that pointed out via Twitter that Conan spent half a million dollars on a walk-out song for Tom Hanks during his last episode.
http://newsone.com/nation/news-one-staff/nbc-serves-fried-chicken-collard-greens-in-honor-of-black-history/
“It” should die on the hill, if for no other reason than, no one knows what “it” is!
Obama admits health care overhaul may die on Hill
Sounding resigned on health care overhaul, Obama urges Dems not to ‘let the moment slip away’ ~ February 5, 2010,
WASHINGTON (AP) — After insisting for a year that failure was not an option, President Barack Obama is now acknowledging his health care overhaul may die in Congress.
His remarks at a Democratic National Committee fundraiser Thursday night sounded contradictory at times, complicating congressional leaders’ effort to revive health care legislation as Democrats hunger for guidance from the White House. Even while saying he still wanted to get the job done, Obama counseled going slow, and bowed to new political realities. Democrats no longer command a filibuster-proof Senate majority, and voters and lawmakers are far more concerned with jobs and the economy than with enacting sweeping and expensive changes to the health system.
“I think it’s very important for us to have a methodical, open process over the next several weeks, and then let’s go ahead and make a decision,” Obama said Thursday night.
A moonbat flashback…
Pelosi: Where Are the Jobs, Mr. President? ~ August 1, 2003
Washington, D.C. — House Democratic Leader Nancy Pelosi released the following statement today on the Bureau of Labor Statistics’ announcement that 470,000 people abandoned their job searches in July and that 3.2 million private sector jobs have been lost since President Bush took office:
“The fact is that President Bush’s misguided economic policies have failed to create jobs. Since President Bush took office, the country has lost 3.2 million jobs, the worst record since President Hoover. And today we learned that in July nearly half a million people gave up looking for a job.
“Job losses are taking a real toll on the financial security of American families. While Democrats are fighting for opportunity, jobs, and economic security for working families, Republicans continue to focus on helping those who need help the least.
“According to today’s survey, while the national unemployment rate dropped slightly, it still stands at a near record high. In addition, the unemployment rate for African Americans was still over 11 percent in July, and the unemployment rate for Hispanics was 8.2 percent in July.
“It is time for President Bush and the Republicans to get to work for all Americans, not just the elite few.”
A moonbat flashback…
That’s a hilarious intro no matter what one’s party is.
DAL Global to lay off 385 at Philadelphia airport
Philadelphia Business Journal ~ 2-4-10
DAL Global Services will lay off 385 employees at Philadelphia International Airport, according to a notice it filed with Pennsylvania’s Department of Labor and Industry.
DAL said it is laying off employees by March 15 because it has lost contracts for aircraft services it has provided to US Airways and United Airlines. In the WARN notice DAL sent to the state, a company official said laid-off workers may have a chance to work with the company that takes over the contracts. Atlanta-based DAL is part of Delta Air Lines (NYSE:DAL) .
“……companies that take over the contracts.”
“With crappier benefits, and a 25% pay cut.”
There, fixed it.
Do we REALLY NEED to have $10/hour mechanics fixing airplanes in this country?
I’m already afraid to fly.
We do until the number of deaths demands different.
Think “automotive recall” economics.
We already have $10/hr mechanics working on auto brakes all over the country.
Which is why I work on my own car.
“The last time federal spending actually lessened year over year was a slight $300 million decline in 1965. This includes every available combination of presidents and congresses, although the slowest growth generally occurs during periods of gridlock. Political paralysis is a blessed thing.”
~Bill Flax
…especially for the bankers.
What just happened? Market is down 127, I make ONE phone call and when I come back it’s -7 and NASDAQ is positive….
Professor Bear tripped and accidentally hit the buy button.
Jib-Jab ping-pong teeter-totter
Jimmy Kimmel creates Tebow ad response:
http://content.usatoday.com/communities/entertainment/post/2010/02/jimm-kimmel-creates-tebow-ad-response/1
PPT putting in a VALIANT effort late in the trading session. Market rockets up 150 points in minutes, erasing almost all of days losses!
I guess the PPT’s budget hasn’t been squeezed any. Nauseating. But history can only be held off for so long.
As long as the printing press technology is operational, there is no macroeconomic budget constraint (at least nominally speaking).
DJIA = 10K or bust…
It’s like deja vu all over again.
Question for the brain trust:
Are there ANY military or police organizations/units that aren’t “Elite”?
Andy of Mayberry?
That was in the early 60’s.
Now I’m sure he’s part of the “Elite Mayberry/Mt. Pilot Metroplex Narcotics Intervention Task Force” or something like that.
The funniest article of the day
Feb. 5 (Bloomberg) — U.S. stocks rose, rebounding from the biggest losses since March, as consumer credit dropped less than forecast and investors speculated the European Union may come up with a solution for Greece and Spain’s budget deficits.
Those unexpected financial reports do it again.
I’ll make the correction:
“PPT Saves the Day After Dismal Fake Jobs Report Spurs Commodities Selloff “.
Ad on Western Slope (Colorado) CL looking for a rental:
I am looking for a 3 or 2 bedroom house for rent under 800$. I have a small dog, and i smoke but not cigarettes.
Ad on Western Slope (Colorado) CL looking for a rental:
“I am looking for a 3 or 2 bedroom house for rent under 800$. I have a small dog, and i smoke but not cigarettes.”
Maybe he/she means a pipe??? Or weed? Or sagebrush? I dunno…
Two men arrested in rental of foreclosed Port St. Lucie home to family
http://www.tcpalm.com/news/2010/feb/02/two-men-arrested-in-rental-of-foreclosed-psl-to/?partner=popular
What does the size of Jamie Dimon’s paycheck have to do with the need to end the failed free TBTF bailout insurance program? Is the few million dollar reduction in Dimon’s paycheck supposed to be some kind of quid pro quo for a catastrophic failure of the U.S. financial system that has already exacted trillions of dollars worth of damage to the U.S. economy?
The ego on display in this suggestion is utterly mind blowing.
MarketWatch First Take
Feb. 5, 2010, 2:42 p.m. EST
Dimon’s pay makes reform tougher
Commentary: J.P. Morgan’s bonus is low by Wall Street standards
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By MarketWatch
NEW YORK (MarketWatch) — Jamie Dimon’s paycheck may be the biggest blow to Wall Street reform this year.
The chairman and chief executive of J.P. Morgan Chase & Co. /quotes/comstock/13*!jpm/quotes/nls/jpm (JPM 38.57, +0.23, +0.60%) was awarded a $17 million bonus made up of restricted stock and options.. Dimon could also lose part of the award should he be terminated for cause “or engages in conduct that” causes financial or reputational harm to J.P.Morgan.
And if “the award was based on materially inaccurate performance metrics” or “was based on a material misrepresentation by the employee,” a filing with the Securities and Exchange Commission said. See full story on Dimon’s compensation.
The bonus, which is for 2009, is at a level far below previous bonus paydays for Dimon who collected $27.8 million in 2007 and $39.1 million in 2006. But the bonus is up from 2008, when Dimon didn’t collect a bonus at all, just a $1 million salary.
In the end, however, Dimon’s relatively smaller paycheck will be a small price to pay should it dampen, or at least fail to fuel, the populist and political forces moving against Wall Street.
J.P. Morgan, after all, has the most to lose under the proposed Volcker Rule. It would be forced to give up its proprietary trading desk, hedge fund relationships and private equity units. The bank, which rode out the financial crisis with relatively fewer losses and damage to the system, now has a CEO whose paycheck is not quite as eye-popping as feared.
…
But the bonus is up from 2008, when Dimon didn’t collect a bonus at all, just a $1 million salary.
—————–
Awww…I’m about to tear up here. Poor, poor, Jamie Dimon.
I wonder if the government will try to restrict access to the internet. The internet is a source of information that the main stream media, corporations and government cannot control to a significant degree.
I was just thinking about all the people who are unemployed or whose finances are deeply in the red. The press and government is crowing about the lowered unemployment rate (despite the loss of yet more jobs and high weekly jobless claims). Where would people find out the data point that the reality is that more people are dropping off the unemployment rolls and becoming part of the “persistently unemployed”?
The limitation would need to be somewhat subtle - increase costs of broadband for example. Fewer corporations providing access to the Web. More stringent limitations on what can be written. Dunno. The thought just occurred to me. Controlling the information is a dear goal of the powers that be. Just look at how furiously the Fed is protecting its secrecy.
“The internet is a source of information that the main stream media, corporations and government cannot control to a significant degree.”
I think posting here is covered under the First Amendment right to free speech, but after the recent SCOTUS decision, I am not so sure…
My 2010 predictions?
- Gloom
- Doom
- “Higher than expected” mortgage defaults
* FEBRUARY 6, 2010
How’s Your Crystal Ball?
Investing is all about predicting the future. What are your predictions for the coming week?
[Crystal ball]
Send your answers to these three burning questions to crystalball@wsj.com by Sunday midnight (the winner’s name will be printed in the paper):
The Wall Street Journal
* REVIEW & OUTLOOK
* FEBRUARY 6, 2010
Blaming Bank of America
Andrew Cuomo sues the bank for following Treasury orders.
The bank bailouts of the last two years have been “about as popular as a root canal,” as President Obama noted in his State of the Union address. This means somebody has to take the blame, and the politicians have nominated the bankers—which certainly beats self-reflection.
So it was probably inevitable that New York Attorney General Andrew Cuomo would file civil fraud charges against Bank of America, its former CEO Ken Lewis, and its former CFO Joe Price, as he did this week. Everyone assumes Mr. Cuomo is running for governor this year, and BofA is conveniently based in Charlotte, …