Bits Bucket For March 25, 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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Bono named worst investor in America
San Francisco Business Times -
U2 singer Bono’s investments into Elevation Partners, which has offices in New York and Menlo Park, have helped make him the “worst investor investor in America,” according to the online publication 24/7 Wall Street.
With large investments in Palm, Forbes, and Move.com — “an unprecedented string of disastrous investments which even bad luck could not explain” — Elevation Partners has earned the distinction of being “arguably the worst run institutional fund of any size in the United States,” 24/7 Wall Street asserts.
Bono is listed on Elevation’s website as one of the five leaders, along with Fred Anderson, former CFO at Apple Computer, Marc Bodnick, founding principal of Silver Lake Partners, Roger McNamee, co-founder of Silver Lake and Integral Capital Partners and Bret Pearlman, former senior managing director of The Blackstone Group.
Elevation bought 25 percent of Palm in 2007, and the company’s stock has since tanked - down to $3.65 from $18 last September - after the company’s efforts to regain mobile phone market share from Apple, RIM and other smartphone makers failed.
Citing unnamed sources, 24/7 says Elevation Partners put $300 million into Forbes’ online operations in 2006, and the company’s total value has dropped from $750 million to “perhaps $100 million.”
Elevation put $100 million into Move.com, which owns home and real estate websites, and company shares subsequently lost 50 percent of their value, 24/7 noted.
And recently, Elevation committed to investing $100 million in Yelp, the San Francisco online user generated business review site, with $25 million to the company and the rest to stockholders. Shortly thereafter, Yelp was hit with multiple lawsuits claiming that it sought to extort money from local businesses in exchange for manipulating reviews, a charge the company says is false.
So which Bono was brighter- this guy or Sonny?
The wrong man went skiing that day, my friend. The wrong man…
I’m shocked I tell ya!
“The Unforgettable Fire: Bono’s investments go up in smoke”
Forbes article headline.
Perhaps ‘Elevation’ should change its name to ‘Defenestration.’
Could be worse, he could have invested in “Elevation Chandler,” the attractive nuisance construction shell that was supposed to be ultra-luxury high price condominiums built essentially in the parking lot of a suburban Phoenix mall.
A couple of old (2008 & 2009) articles:
“Jeff Cline, developer of Elevation Chandler, is homeless, according to his attorney.
‘He’s living on the street,’ attorney Scott Goldberg said after a bankruptcy hearing Thursday. Elevation Chandler is the abandoned construction site south of Chandler Fashion Center at the intersection of Loops 101 and 202.
It was to be two towers, one of luxury condominiums and the other, a 10-story high-rise occupied by a hotel topped by condos. Cline ran into financial problems and finally filed for bankruptcy protection in April 2008.”
“The attorney said he believes Cline is living in Michigan because when Cline calls him, a Michigan area code pops up on the caller I.D.
‘He has to go to Kinko’s to call,’ Goldberg said.”
http://www.azcentral.com/community/chandler/articles/2009/05/15/20090515cr-elevation0516.html
“Originally, Cline estimated the project’s build-out value at more than $200 million. During the past two years, the as-is value has ranged from a low of $16 million to a high of $60 million, according to published reports. The final auction bid might be even lower, given that land values have dropped in the Phoenix area and demolition costs might be substantial.”
http://phoenix.bizjournals.com/phoenix/stories/2008/10/20/daily46.html
I’m calling BS on the “homeless” thing. I bet the guy socked away a bunch of that cash, is still living high on the hog, and his attorney is trying to paint a different picture. If he doesn’t have any money, how is he paying his attorney? The guy took the money and ran.
So does that make Bono the “anti-Trump” now then? People will actually flow away from things with his name on them, instead of towards?
The guys in Panama that don’t run from anything named Trump that advertises it is 90% sold are what confuses me.
What about Nicholas Cage??
There are plenty of bankrupt starts out there.
Reminds me of Kevin Bacon and his wife trusting Madoff.
“Marc Bodnick, founding principal of Silver Lake Partners, Roger McNamee, co-founder of Silver Lake and Integral Capital Partners and Bret Pearlman, former senior managing director of The Blackstone Group.”
He might have thought he was covered partnering with these guys.
Rock stars are reknown for their financial savvy.
U.S. House Approves Extending Build America Bonds Through 2013
(Bloomberg) — The U.S. House of Representatives approved an extension to the Build America Bonds program, the economic-stimulus measure that has cut interest costs for local governments and fueled a rally in tax-exempt debt.
The House passed by a vote of 246-178 the bill extending the program until April 2013. Build America provides direct subsidies to state and local governments that sell taxable bonds, an alternative to traditional municipal debt, which provides tax breaks to investors. Borrowers from California to New York have sold $87 billion of the new taxable bonds to fund public works, according to data compiled by Bloomberg.
“The money goes to local communities for infrastructure and that creates jobs,” Sander Levin, a Michigan Democrat and acting House Ways and Means Committee chairman, said of the Build America program during debate on the House floor. “It’s one of the economic recovery effort’s biggest successes.”
Ah, the irony of easy lending at artificially low interest rates leading to an economic decline (alternatively, fueling an articial and usustainable boom) being used as a measure to end the Great Recession ™.
You just can’t make this stuff up.
Lol. The states aren’t allowed to print money so the Fed (who is allowed to print money) does the printing and sends the money over to the states.
Hyperinflationary, right?
Wrong! The amount of money created by Fed printing doesn’t anywhere come close to replacing the amount of money destroyed by repudiations and bankruptcies.
The last I heard, this downturn has destroyed about seventeen-trillion dollars of household wealth.
The last I heard, this downturn has destroyed about seventeen-trillion dollars of household wealth.
That’s pretty bogus though. It wasn’t real wealth/money - it was “equity” which is simply non-existent. The same is true for such claims on the stock market.
Reason is that the act of cashing in this “wealth” causes prices to go down, thus causes this bogus equity to go down for every else that isn’t selling.
Thus very little actual money is disappearing, because very little existed in the first place. “Equity” is only equivalent to money at a micro level - e.g. an individual’s house or an individual’s 401k - it’s not equivalent to money at a macro level.
However the money created by the Fed is real (per se - it’s still fiat money). That’s why the creation of a mere $2T or so of new money has been able to offset the supposed $17T or so of lost money (more if you include stocks and all the financial instruments), such that we haven’t had a deflationary environment*.
*At least for most goods and services. Housing of course has been very deflationary.
“…such that we haven’t had a deflationary environment*.”
When considering price inflation/deflation, it’s important to consider all the money involved. For instance, China appears to have increased its effective money supply, so that cash is out there putting upward pressure on commodity, energy and food prices. It’s less effective on US RE.
‘…it was “equity” which is simply non-existent. The same is true for such claims on the stock market.’
But weren’t real dollars loaned out to purchase homes on the so-called ‘non-existent’ equity? What happened to those dollars that were loaned to buy $600,000 homes in Coastal California when it turned out the homes were only worth $300,000?
There were some real dollars involved yes. But not nearly the amount as indicated in the “equity” gains.
E.g. if you were to pump $1T into the stock market today, the total equity would go up far above $1T. Same thing happened to the housing market, and happens with every market.
The other problem, which I am not sure even the highest powers and brightest minds at the Fed have yet grasped, is that it is not enough to merely ‘print’ money; you need to debauch lending standards back to pre-2005 levels to prop up the value of housing where it was back then. Without enabling Central Valley ag workers making $30,000 a year in household income to purchase $700,000 homes in Gilroy, how are you going to prop up the value of homes in Gilroy at anywhere near $700,000?
Correct.
Thankfully we have the FHA doing that for us, as well as the Fed MBS purchases keeping mortgage rates low (for another week at least - until such time as it’s extended), as well as tax credits, etc.
Nevertheless - you’re right in that there’s only so much “pointing” they can do to drive all this new money back into housing. In the end, it’s a given that prices won’t drive back up the way they did in the 1997-2006 period. People know that - so there won’t be the irrational-exuberance-fed bubble that existed before; at best just a general slow floating up (if the various Fed/gov efforts succeed.)
So long as prices are high enough that folks can’t really afford the houses - and thus need to get deeply into debt to “own” them - the bankers will be happy. They can still “flip” houses to the next sucker at high prices, charge fees for each “flip” and sit on their REO inventory while it all is still “valued” at its 2005 price. Such a system!
“Without enabling Central Valley ag workers making $30,000 a year in household income to purchase $700,000 homes in Gilroy, how are you going to prop up the value of homes in Gilroy at anywhere near $700,000?”
The reality is, the government can suspend, refuse to enforce, or repeal
financial regulations requiring banks to value their REO at market.
However the reality is also that the government cannot repeal the laws of mathematics.
The larger reality is therefore, every current policy to “extend and pretend” will ultimately fail. In practice, this means that Megabank will continue over-paying its executives salaries and bonuses based on fraudulent assets, gains, and income. In return, the banksters will continue to reward lobbyists and politicians with a portion of the ill-gotten gains.
The so-called Bogus Wealth led people to buy second houses, fancy cars, & etc. that they would not otherwise have bought. We’ve had an entire Bogus Economy. All that remains of much of it is Bogus Debt.
Not making sens to me though how your personal 401K can be real wealth while the pool of these things is Bogus Wealth.
I said this yesterday: Megabanks bought our government with this “bogus wealth”. We all bought crap.
I said this yesterday: Megabanks bought our government with this “bogus wealth”. We all bought crap.
Perfect summary - As wealth concentrates so does political power. Now with the Supreme Court saying anything goes, and the bailout and printing press enriching a small segment of the population while the rest become poorer you can expect the elite to have even more influence on our gov.
Its kind of like when AOL bought Time Warner at the height of the internet bubble. Something real was bought with something fake. Crappy AOL got to keep TWC and control it.
I’ve often wondered if the same is true of the Madoff investment losses. How much of the $50 Billion or whatever it is claimed to be was real, eg, hard dollars forked over to Bernie, and how much was illusionary gains. I’ve tried to find something that addresses that but have not found it.
“That’s pretty bogus though. It wasn’t real wealth/money - it was ‘equity’ - which is simply non existent.”
This non-existent wealth/money would sure come in handy when it comes to solving some of these financial problems, don’t you think?
So, Packman, share some of your insight with the rest of us and tell us where all the money went.
This non-existent wealth/money would sure come in handy when it comes to solving some of these financial problems, don’t you think?
No - it wouldn’t. That $17M could be used to “solve financial problems” because it didn’t exist.
So, Packman, share some of your insight with the rest of us and tell us where all the money went.
It didn’t go anywhere. It never existed.
Again - it’s like the stock market. Say a given company has 1 million outstanding shares of stock - stock for which the last exchange was done at $100 each, for a market cap (”equity”) of $100 million. Someone now (say person A) wants to buy 5,000 shares. The ask price though is above $100, say at $101. So person B sells his 5,000 shares at $101 each ($505,000 total), and person A buys them for $505,000. It’s an even exchange - one person gave up $505,000, and the other one gained $505,000. No money was created or destroyed.
However now the stock in the company is valued at $101 a share. At 1 million shares, the market cap (equity) of the company is now $101 million. Before it was only $100 million though! Where did the extra $1 million come from? It didn’t come from anywhere - it simply doesn’t exist.
Thus equity does equal money at a micro level - e.g. person B who got $505,000 for his 5000 shares of stock. The increase of stock price from $100 to $101 actually resulted in him getting an extra $5,000. However at a macro level equity does not equal money. This is because person A had to put in an extra $5,000 in order for the transaction to occur.
Say now the company released some really bad news, and everyone dumped their stock. As they dumped, the price plummeted - e.g. person C sold (to person D) for $90 a share, person E sold (to person F) for $80 a share. At the end of the run down the stock ends up at only $10 a share. The market cap of the company is now just $10 million. A wipeout of over $90 million equity. However zero money was destroyed, because every stock transaction included an equal exchange of money - it merely transferred hands from one person to another.
It’s amazing how most people just don’t get that. They see equity being exchangeable for money at a micro level - but don’t realize that they’re only looking at one side of the transaction and not the other - thus don’t realize that money isn’t actually created or destroyed by these transactions, even though the market prices of the asset changes.
“Equity” is simply how much of a loan you’ve paid back.
Those ads to “free your equity” were just come-ons to go into more debt, using your house’s net worth as collateral.
It’s like owing Vinny the loan shark 10K. You pay off 4K. You’ve got 4K “equity” now. That’s just the amount by which you’ve reduced your debt, on your way to get your net worth back to zero.
“Equity” is one of those made up terms used to entice FBs into going into more debt.
Yes , real weath gone.
Maybe even just as significant as real wealth loss of everyday Americans is the emotional hit and sense of discouragement after moving dollars out of equities at the bottom of the crash and then missing the recent market surge.
That’s gotta hurt…..
Well, don’t worry: everyone will pile back in right before the next engineered market drop. Pump and Dump is part of the new game plan!
This is one massive stock market rebound, that’s for sure. How far this thing goes is anyone’s guess, but it’s quite remarkable.
The question is, did it include a provision to allow debt for regular operating expenditures as a opposed to just building America?
Who buys these bonds? The Treasury?
More debts for future generations to pay in order to keep paying salaries for todays construction and government employees. This is quite possibly the most immoral activity in which our government is involved and is certainly the ultimate form of taxation without representation. Those responsible to pay these debts can’t even vote yet.
Social Security to See Payout Exceed Pay-In This Year
NYT
This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.
Stephen C. Goss, chief actuary of the Social Security Administration, said that while the Congressional projection would probably be borne out, the change would have no effect on benefits in 2010 and retirees would keep receiving their checks as usual.
The problem, he said, is that payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned. At the same time, the program’s revenue has fallen sharply, because there are fewer paychecks to tax.
Ah what’s the big deal? The Federal Reserve will just print more money and start buying the IOUs that Soc Security has stockpiled.
And when they run out of IOUs to sell? They’ll cross that bridge when they get to it.
because there are fewer paychecks to tax.
This looks alot like socialism! Ok, so, where is the money coming from? Just keep printing?
dam dem dar sochulists!
Is that your answer to his question about where the money comes from? You speaking Na’vi?
Stpn2 - As a military man you might hope they keep printing cash, I suspect many military paychecks depend on it.
PS - Socialism says nothing about running the printing press. Some socialist countries have better debt to gdp ratios than we do, Finlands is about 1/2 and Hollands 2/3 of US.
Stall in housing market threatens economy
Fed ending program that has held mortgage rates down may also hurt
MSNBC
WASHINGTON - The recovery in the housing market is at risk of collapsing.
Home sales are sliding, prices are stalling and foreclosures are rising. And mortgage rates are likely to go up after next week, when the Federal Reserve ends a program that has driven them down.
The trend could threaten the broader economy, economists warn. People whose home equity is stagnant or shrinking are less likely to spend freely.
Please, let prices collapse. It’s better to rip the soiled bandage off all at once.
Well, they probably figure that if home prices can be outrageous in backwater towns in India and China and other 3rd world cesspools where they are completely out of sync with incomes, why not in the US?
That’s exactly what they’re figuring.
I will believe any of these programs have ended (with no equivalent replacement home price support programs) only when I (1) see the evidence in print; (2) see home prices resume their declines.
“Home sales are sliding, prices are stalling and foreclosures are rising.”
Lions and tigers and bears, Oh my.
The Wizard will know what to do.
Pay no attention to that inventory behind the curtain.
“People whose home equity is stagnant or shrinking are less likely to spend freely.”
Not the case when they are no longer paying a delinquent mortgage and are using the money to buy everything in sight, which I think is going on like crazy.
“Stall in housing market threatens economy”
As the night follows the day, more hair-of-the-dog housing reflation stimulus programs are sure to follow any stall in the housing market.
From USA today:
“The bank said to avoid foreclosures, it will start forgiving principal for homeowners who owe more than 120% of their home’s value and meet other qualifications.”
“The program, which goes into effect in May, will first forgive mortgage principal and then reduce interest rates for qualifying homeowners. Under the federal loan modification program, principal forgiveness is typically the last step in reducing payments for a borrower.”
“Those who qualify for the Bank of America plan must have one of three kinds of loans: a subprime loan; a “pay-option” loan, which allows borrowers to make a lower payment that can result in the unpaid portion being added to the principal balance; or a prime two-year hybrid loan, which often starts as a fixed-rate loan, but then the interest rate rises”
Anything to buy time and try to prop up house values and screw those who can really afford the houses. Yes, let’s encourage more non-responsibility. More government in our lives please.
What ,the people who took out the most leveraged toxic loans that paid the lowest payments get a stab at principal reductions ? We just should of given every American 100 thousand and called it a day (just kidding I don’t believe that either ). Talk about moral hazard ,the government picking the winners and losers again . What about a person who took out a fixed loan that is buried .They never should of started this bail out stuff .
The biggest gambler spend until they drop person on my block was the one that got a loan modification . She took out at least 100k in equity loans for the good things in life . She is also the one playing the victim card all the time and than smirking when she gets someone else to
rescue her and shes the block drunk also .
They are just trying to keep the people chained to their anchor. But yea, it stinks. I wonder if that will make it into comps.
Of course not.
Housing only goes up… or at least stalls at 2005 values… forever!
Like Dow 10,000 as it were…
“I wonder if that will make it into comps.”
That’s what burns my aXX!. They’re not sales so why would they be considered comps? And is there anything preventing mortgage holders from turning around and making money on the situation by selling to some nitwit that sees a V-shaped recovery and wants in at a higher price than the bank now holds the owner liable for.
Realtors are gonna be loving this.
This is what you get when the population IQ level is at cesspool levels. Not many in this land can man up and raise hell against the policy of bailing out the WallSt fatcats.
“…it will start forgiving principal for homeowners who owe more than 120% of their home’s value and meet other qualifications.”
Only those who are so f-d that they would clearly be better off walking away need apply.
Not even a BK to go with it?
BS.
Interesting…
“The Lehman Whistleblower Letter Everyone Ignored”:
http://news.hereisthecity.com/news/business_news/10215.cntns
I wonder how many banks today are in the same pickle, ignored (or aided and abetted) by senior management? It all comes down to integrity and competency of people at the top…
BA company closing; 300 jobs to be lost
Tulsa World
About 300 employees of Caterpillar Logistics Services Inc., known as Cat Logistics, have been told the company’s Broken Arrow facility will close at the end of August and they will lose their jobs.
Cat Logistics, a wholly owned subsidiary of Peoria, Ill.-based Caterpillar Inc., began its Tulsa-area operations in 2000. The 70,000-square-foot site at 13505 E. 61st St. is the national repair and distribution center for U.S. Cellular handsets.
An e-mailed statement from Caterpillar said U.S. Cellular is letting its service agreement expire at the end of August and has selected a provider that specializes in the cell phone industry.
“Employees have been informed as this will lead to the closure of the Cat Logistics facility in Broken Arrow,” Caterpillar stated.
The center employs approximately 200 Caterpillar associates and 100 agency employees.
“Over the next several months, Cat Logistics will work closely with U.S. Cellular on the transition plan, and operations will cease at the facility concurrent with the end of the contract at the end of August,” said Bridget Young, a media relations representative for Caterpillar, in an e-mailed response to questions.
Information was not available on whether employees would receive severance packages.
An e-mailed statement from Caterpillar said U.S. Cellular is letting its service agreement expire at the end of August and has selected a provider that specializes in the cell phone industry.
And which is probably offshore.
Information was not available on whether employees would receive severance packages.
As the magic 8 ball would say:
Don’t count on it
My reply is no
My sources say no
Outlook not so good
Very doubtful
More “green shoots” for our doomed economy.
I companies expect the US dollar to crash in value why outsource? Or do they expect the US dollar to rise relative to other currencies?
Some comments from the
Bank of America has new ‘forgiveness’ program to help struggling homeowners
article in The Palm Beach Post
“I called my mortgage comp.just to see what they had to say If I tell them I could not afford to continue my 500K loan. They suggested I do a short sale at the suggested sale price of 80k ( my down payment in 2005 was 90K)
. I responded I have never missed a payment nor been late, can’t I get my home principal lowered to 80K. The loan mitigation person laughed and said”NO”. Home ownership is a joke!”
rosybb
5:01 PM, 3/24/2010
“Why should they reduce your principle?
I rented during this run up of prices can I get my money back?
Why are you so concerned with what your home is NOW worth, I bet when it was worth double you were smiling..
Well, to bad, I paid over 250,000 in rent over the last 7 years…I have to **** that up, now you can do the same.”
sKB
7:03 PM, 3/24/2010
“Great, I pay on time and struggle to make my payments because that is what a mortgage contract is. A promise to pay. So I am an honest hardworking person that pays on time and I can’t catch a break. Sounds like people like me are always the ones getting it up the rear end.”
American
8:41 PM, 3/24/2010
Wait. This rosy person agreed to pay 590K for an 80K house?
Wonder if the Chinese bondholders have a “forgiveness program”? I think they are going to want their $hit.
They’ve got everything they asked for. They wanted paper and we gave it to them. If they get restless there’s more where that came from. What could they possibly complain about?
Funny you mention the Chinese. They bought a LOT of RE over the last 10 years.
Now ponder how many of them are going to get “forgiveness.”
Wow, just wow.
B of A to forgive 3 BILLION in FB debt.
http://www.reuters.com/article/idUSN2416553220100324?type=marketsNews
WASHINGTON, March 24 (Reuters) - Under pressure from Massachusetts Attorney General Martha Coakley, Bank of America Corp. (BAC.N) on Wednesday said it would offer about $3 billion in loan forgiveness to about 45,000 troubled homeowners.
—————–
So the delay continues, that is 45k worth of jingle-mail or foreclosures that will not (yet) hit the market. More of our tax money given away to those that abused the system.
“So the delay continues …”
That it does. The longer the delay continues the longer the FBs get to experience the joys of homeownership and the more housepayments these FBs get to send to the banks.
$66,667 of forgiveness on average.
Like every other measure before it, this will only contribute to further price declines. Whereas before the FB may have been trapped into an unaffordable mortgage (unable to sell due to negative equity), in theory they are now “whole” - and can put the house on the market. Higher supply = lower prices.
(I love the nature of unintended consequences).
Which will continue until DEMAND is driven by consumption, not speculation, and prices stabilize. Everything else is piling sandbags on the low tide line, a wasted effort that ultimately robs resources from effective intervention at supportable price levels.
Chile, I don’t think it will make the declines any deeper than they otherwise would have been. It will, however, slow down and stretch out the declines, and allow the banks to collect more monthly payments.
Piling sandbags on the low tide line - awesome analogy!
Not even something as durable as sandbags - more like a line of dribble-castles.
High tide comes in
Does damage
High tide goes low
Pile sandbags where?
Ah, but the FB can’t immediately sell his house. This program is implemented over a span of five years.
For the FBs the “F” remains attached to the “B”.
If the FB signs up then he gets a chunk of money on his loan forgiven over a period of five years IF he keeps up with the payments.
This locks him into keeping the house for at least five years because if he walks before these five years are up he has to repay the amount that was forgiven. So he remains stuck more than ever. Meanwhile the bank gets to enjoy a steady flow of monthly payments for those five years.
Yep:
The house won’t be put on the market so somebody who really can afford could buy it, the bank keeps making money, AND the bank gets to keep the house “valued” at its peak value on its books.
So, basically everyone but the responsible people make out well from this. Typical.
The NPR report this morning said that the “forgiveness” doesn’t get finalized until they make the new payments on time for five years.
Good luck with that.
Wow. In that case, where’s the delete key Ben?!?!
No way this makes any difference at all.
Bank of Oppoortunity really doesn’t have a clue when it comes to be taken advantage of by their customers do they?
“Like every other measure before it, this will only contribute to further price declines. Whereas before the FB may have been trapped into an unaffordable mortgage (unable to sell due to negative equity), in theory they are now “whole” - and can put the house on the market. Higher supply = lower prices.”
I think the catch is you have to stay current on your payment for the next 5 years, and the principle deduction is phased in at 20% over those five years. So if the FB sold the house, I think they’re back to owing what they originally owed.
And if values continue to decline, which they will, even those FB’s who received a partial principle write-down will probably still walk.
What none of these plans address is the reality that FB’s don’t want these houses if they’re not going to turn an easy profit, be able to cash out for that trip to Disney Land, etc.
BOA Pricipal 5 Yr Writedown
It will be interesting to see how non-recourse states are written into BOA’s contracts with the homemoaners. What will the contracts say about short sales?
“Principal” -typo
“So the delay continues …”
That it does.
Combo, addressing your theory of the government delaying the housing crash, for liquidity and entire system solvency issues,
Do you think they are doing enough and is it working as you thought it might?
Have any of the policies surprised you?
Will they do more?
“Do you think they are doing enough and is it working as you thought it might?”
Yeah, I think it is working. Extending hope to FBs is what it is all about, and the Fbs should become increasingly hopeful, especially after Mass “forced” BofA to do some “forgiving”.
Lol. Think of the political win Mass got from this deal along with the financial win BofA got.
Mass “showed” the voters that it was willing to take on the mighty BofA on behalf of the little guy. BofA gets to lock in the FBs for five years instead of wondering from day-to-day if the Fbs are going to walk. The write-down folks are sure to be pleased with BofA’s balance sheet if enough FBs sign up for this “forgiveness”.
But if none of this works then something else will be tried.
In fact it’s a sure thing something else will be tried because there is a growing send-the-keys-back-to-the-bank movement sweeping the country - something that should keep a lot of PTB folks awake at night. Whether one agrees or not, saving the banks is the top priority among the thinking of the PTBs; They will do whatever it takes to keep the system functioning.
IMHO.
..More of our tax money given away to those that abused the system…
Actually, this is not tax payer money.
BofA repaid TARP back in December, when sent the US Treasury a check for $45,000,000,000… and bought back it’s 600,000 shares of preferred stock which were security on the TARP loan.
I think they also paid an extra $3 billion (?) in interest on that TARP loan, as well as a pre-payment penalty.
This loan-forgiveness thing is old business due to legal trouble Countrywide got itself into. (which BofA purchased.. now called Bank of America Home Loans).
The deal was that either BofA agreed to try some flaky program to help some of Countrywide’s FBs continue to feed their alligators, or several States would sue and hound BofA every which way for the foreseeable future.
And it’s not a guaranteed pay out.
BofA ..said it would offer about $3 billion in loan forgiveness..
All BofA agreed to do is make an OFFERing..
The “offer” may cost the bank little or nothing if the FBs don’t comply with their end of the bargain.
oops.. not 600,000 shares. They bought back 1,800,000 shares of various issues of preferred stock.
The only reason B of A could repay is because of the govt bailout of AIG.
Still taxpayer money, just laundered through the AIG back door.
That’s a sweet and righteous sentiment… kinda like “I owe everything I have to my parents, who supported me when I needed it.”
Well, do the right thing. Pay your parents back.
Just one more step on the wealth redistribution train.
Then make sure that you don’t hold stock in Bank of America, directly or through any mutual funds. If you have to sell any of your funds, send a letter to the manager telling him/her why you sold.
Good suggestion Polly. I don’t own any financials presently though.
In battlefield triage, the medics let go the soldiers who are likely to die no matter what treatment they receive in favor of those who are in rough shape, but at least have a hope of being saved with immediate care. So I find it interesting that BOA is excluding 30-Year Fixed Rate mortgages from the program.
Double punishing those that made wise initial decisions. So GLAD I am renting.
This is not battlefield triage, but rather the parasitic food chain we are discussing here. A parasite does best by maximizing the number of hosts it can exploit. The healthy (e.g. financially solvent and responsible) hosts are not going anywhere; it is the hosts who are on the brink of death who must be kept alive in order for Megabank of America to continue feasting on their flesh.
“B of A to forgive 3 BILLION in FB debt.”
Why is my government subsidy detector tingling?
Yep ,can’t believe that some form of taxpayer subsidy doesn’t come into this if not directly indirectly .
For some perspective, i read somewhere that BofA lent $3 billion per day during the period it held TARP funds.
here it is…
“Adding TARP to our capital has allowed Bank of America to continue to support the economy. In the 12 months since the government first made its investment in Bank of America, our company originated $760 billion in new credit, or approximately $3 billion per business day,” Lewis added.
http://newsroom.bankofamerica.com/index.php?s=43&item=8583
The forgiveness would be offered in two stages for the riskiest loans, including subprime loans and loans that offered borrowers multiple options for how much to pay each month.
Ineligible are 30-year fixed-rate loans.
The lender will first offer an interest-free forbearance of principal that the homeowner can turn into forgiven principal annually over five years, provided they stay current on their payments.
TYING FORGIVENESS TO PERFORMANCE
The forgiveness can let a homeowner bring the loan value back down to 100 percent of the home’s value over five years.
What if interest rates don’t rise?
” “We might hope that financial markets would save us from catastrophe by demanding higher interest rates on Treasurys, but that would require a degree of foresight that we haven’t seen lately,” Syracuse University budget expert Leonard Burman told a House Ways and Means Committee panel earlier this week.
Indeed, market players are showing increasing confidence that rates won’t rise any time soon. The spread on a 10-year interest rate swap, reflecting the price an issuer of floating-rate bonds might pay to lock in a fixed rate, turned negative this week for the first time.
“I keep expecting a normalization, but the market is convinced the Fed is not going to do it,” said Howard Simons, a strategist at Bianco Research in Chicago, about when the Fed might boost short-term rates.” ”
Speaking of Syracuse, Go Orange!!
BOJ has had <1% for 15 years now. It’s very feasible, and not unlikely for us at all.
…..and downtown Tokyo real estate has fallen by 75-80% over that time.
Yup. Super-duper low interest rates have no marginal effect once the central bank is pushing on a string.
… which explains the need for MBS purchases, $8K first-time homebuyer credits, federal guarantees of low-downpayment FHA mortgages, elimination of the GSE spending cap, etc etc etc. Even with all of the above stimuli layered on top of the Fed’s super-duper low interest rates, U.S. housing prices have mustered only the weakest of dead cat bounces.
I am personally heartened by the news that Canadians and other foreign nationals armed with cash offers are mistaking the dead cat bounce for a signal the U.S. housing market has bottomed out. The more foreign nationals who throw away money on falling knife U.S. real estate investments, the less of America’s collective household wealth will need to get destroyed to cover the cost of the debacle.
But the Canadians aren’t buying the overpriced stuff ,or the high end market stuff . It does explain why regular folks in the market weren’t able to compete with the cash investors on foreclosures. But that’s find ,if Canadians want second homes here to avoid the winters by all means we have excess supply that would just start to rot .
But this begs the question, are the Canadians buying second homes in the US bouyed by the notion that their wealth is increasing due to the run up in Canadian housing prices? If so, its likely to end badly for the Canadians.
I don’t think there are enough famlies in Canada that need or could buy up all the excess housing. It’s not like they have that kind of money up there.
Probably less than 5% of the population could afford to buy houses in the US. So we are talking about 1.5 million out of 12 million forclosures.
Hopefully china sends some $ over.
Low interest rates are “great!”
They don’t fix the real problems, encourage random bubbles, and punish savers and people on fixed incomes. They also let central bankers borrow at stupid-low rates and lend out at high rates, thus allowing them to make no-risk fortunes.
I expect super-low rates to be with us basically forever, barring some outside event that forces rates to rise.
Speaking of Syracuse, Go Orange!!
sis boom rah!
He aims to distract US:
Osama-B-Hidin’… put down that microphone, pick up some more chalk, keep drawing on that kerosene lit cave wall…oh, and in case your jackass delivery system hasn’t reached you yet, some of you cousins got busted in your old ‘hood…tsk,tsk,tsk.
THE Most Important Chart of the CENTURY
By Nathan Martin
The latest U.S. Treasury Z1 Flow of Funds report was released on March 11, 2010, bringing the data current through the end of 2009. What follows is the most important chart of your lifetime. It relegates almost all modern economists and economic theory to the dustbin of history. Any economic theory, formula, or relationship that does not consider this non-linear relationship of DEBT and phase transition is destined to fail.
It explains the “jobless” recoveries of the past and how each recent economic cycle produces higher money figures, yet lower employment. It explains why we are seeing debt driven events that circle the globe. It explains the psychological uneasiness that underpins this point in history, the elephant in the room that nobody sees or can describe.
This is a very simple chart. It takes the change in GDP and divides it by the change in Debt. What it shows is how much productivity is gained by infusing $1 of debt into our debt backed money system.
http://fedupusa.org/2010/03/20/the-most-important-chart-of-the-century/
Is there any connection to that chart and the notion that the Fed is ‘pushing on a string’ (while still pretending to be all powerful)?
Treasury planning Citi stake sale: report ~ March 25, 2010
(Reuters) - The U.S. Treasury could unveil a preset trading plan next month for the sale of its 27 percent stake in Citigroup Inc (NYSE:C - News), Bloomberg said on Thursday, citing people with direct knowledge of the matter.
The Treasury plan will lock the government into a schedule for selling its shares with the aim of eliminating any concerns that the sales are based on non-public information, Bloomberg said.
The Treasury would issue instructions on how many shares to sell and at what price, it said.
Citigroup has posted more than $100 billion of writedowns and credit losses since late 2007 and the bank’s shares have lost 90 percent of their value since late 2006, with the bank requiring three different government rescues in 2008 and 2009.
The U.S. Treasury and Citigroup could not be immediately reached for comment by Reuters outside regular U.S. business hours.
The stock is currently selling for over 30% higher than what the government paid. The government is expected to make billions.
So who are they going to sell those shares to?More gullable retail investors being sucked into the top of a market? The stock is at 4 bucks for a reason that most of us will really never no.The insiders have the game rigged. I wouldn’t touch this cr@ppy stock.
I sold at $4.10. I may pick some up around $3.8 if it hits that price again. I just don’t know what to expect with the government sale, so decided to take my profits. With that much stock being sold and so many day traders, it’s a roller coaster ride.
Yep, that’s the plan - Pump and Dump!
What’s the alternative? Making money honestly? Hahaha - that’s not the way it is done these days…
Study: Homeless shelters stays can cost more than rent.
USA TODAY ~ 3-25-10
Cities, states and the federal government pay more to provide the homeless with short-term shelter and services than what it would cost to rent permanent housing, the U.S. government reports.
A study of 9,000 families and individuals being released today by the Department of Housing and Urban Development finds that costs to house the newly homeless vary widely, depending on the type of shelter and social services provided by the six cities in the report.
Emergency shelter for families was the most costly. In Washington, D.C., the average bill for a month in an emergency shelter ranges from $2,500 to $3,700. In Houston, the average is $1,391.
Many communities probably don’t know that they are spending as much “to maintain a cot in a gymnasium with 100 other cots” as it would cost to rent an efficiency apartment, says Dennis Culhane, a University of Pennsylvania professor who studies housing policies. “We are paying for a form of housing that is largely substandard, and we are paying as much, if not more, than standard conventional housing.”
Paying more for a cot than an apartment?
You’d think city governments would be more careful about how they spend that community’s precious, hard earned tax money… not.
“… the average bill for a month in an emergency shelter ranges from $2,500 to $3,700.”
Assuming 30-day months, that works out to be about $83 to $123 a day. Way overpriced considering what one can get by renting a motel room.
Would you expect anything less from our ultra-inefficient government who now is going to run healcare?
Where do you get that? Please show me where there’s anything written about the government “running” healthcare? Looks to me like the insurance companies will continue to run it.
I said “healcare”, not healthcare, so there!
New York’s experience shows this analysis is bogus.
Provide the “homeless” with free apartments, and suddenly you have tens of thousands of people showing up from all over the country claiming to be homeless.
Lots of nasty people (and some not so nasty people) are stuck living with other nasty people because they can’t afford their own place. Lots of other people can’t afford a really good place. Lots of these people were showing up in NY when the city adopted a policy of providing cheaper housing rather than that cot.
San Francisco used to give them cash.. it has since wised up.
Now, they do offer free-forever apartments (flea bag hotel rooms) but it’s not at all easy to get one. A homeless person has to jump through a few hoops.. like regular job searches and reports.. and after a year of failing to find any work they might get an apt, if they are lucky.
I know one guy who’s been on the list for about 2 or 3 years. Didn’t qualify for a long time due to the never ending unemployment insurance extensions.. Recently missed one important appointment and his file went to the bottom of the pile..
Correct. All the other cities provide their homeless with a one-way bus ticket to the sucker city.
Here’s a link.
This doesn’t pass the sniff test. Warrants further investigation….
After thinking about it some more - here’s my thought. It actually makes sense that a homeless shelter would cost as much or more than an apartment or even a hotel room. The main reason is that there’s simply a lot more human support there for a homeless shelter. They generally have one or multiple people there staffing it all night, to deal with problems that come up - no true for rental apartments. Even though hotels do have nightly staff, generally the ratio of residents:staff is much higher at a motel than would be at a homeless shelter.
Additionally you have other support things at a homeless shelter that you may not have have in apartments or motels. There are often staff there to provide assistance in job hunting and various social services for instance.
I think this generally offsets the other savings in the economies of scale and lesser quality of housing than in apartments/motels.
If indeed the costs of these things are roughly equal (hypothetically, since the article presents that they “can” cost more, not that the “do cost more, on average”), a dangerous conclusion would be that it’s appropriate to simply provide hotel rooms or apartments or whatever to homeless people. Problem is that homeless generally need a lot more of this support - social services etc. - than the average person/family. They don’t just need a home.
Exactly.
This news release would sure dovetail nicely with a goverment proposal to purchase abandoned homes for housing homeless people.
Bingo.
I proposed about 2-3 years ago on the HBB that this would be the end result of the housing bubble. There will be a tremendous rise in government-provided housing, and much will almost certainly be from the pool of foreclosures and unsold inventory. Count on it.
Posted a link that’ll show up at some point.
This doesn’t pass the sniff test. Generally any statement that something “can” cost xxxx has to be taken with a big grain of salt. That’s kind of like saying “treatment for a cut finger at hospital XXX can cost more than a broken arm”. This will always be the case because there are always extreme outliers - someone has a cut finger that gets infected and requires multiple treatments for gangrene, or gets stitches that go bad and have to be redone, etc. When you compare extreme outliers it’s usually not a valid comparison.
E.g. in this case it presents “emergency shelters” as high cost - but aren’t emergency shelters only supposed to be used for emergencies - and thus not homeless? Emergency shelters *should* be more expensive, because they probably have more facilities to handle emergency care - more medical equipment, etc. - and they’re probably more likely to be located in high-rent areas; places where you’d house people who are temporarily homeless due to some emergency situation.
(I haven’t checked the studies details - it’s not coming up for me yet)
Follow-up - see my above post. Seems to me it’s actually not far-fetched for homeless shelter costs to be roughly equal to apartments or motels. It makes sense, and there’s nothing wrong with it.
Bogus Jobless Claims Drop “More Than Expected”:
The article even admits that the numbers truly are bogus.
http://finance.yahoo.com/news/Initial-jobless-claims-drop-apf-3154149350.html?x=0&sec=topStories&pos=1&asset=428406df7887af556602ed740f3b809f&ccode=mp
“Larger than expected”
I personally expect ‘better than expected’ economic data releases from now through the Fall 2010 election season.
I also heard tractor production was up, comrade!
My girlfriend’s step-brother just moved back to Florida from California and he brought his new honey (from CA) with him. Both are recently laid-off (in CA) and each are drawing $500/wk unemployment (from CA). He is currently working in construction in Orlando and is being payed under the table so he can continue to receive the UE check. Not sure what work if any she might be doing “off the books”. So, they are getting $2000/mo and are living in an area where the cost of living is ridiculously inexpensive - rent like $700/mo for a decent 3br house. Aint life grand!?
He paid into unemployment while employed, so really he’s just getting some percentage less than 100% of his own money back. I agree that he’s cheating the system, but in the grand scheme of things, it’s a minor cheat.
And stuff like this has been going on for decades. A friend of mine once had a tenant in a townhhouse he owned in Oceanside, CA. The guy was married and on disability. They were collecting SS disability checks and section 8 paid the rent. He had an under the table job, now get this, laying carpet.
This was back in the late 80’s.
Not everybody who’s getting UI in CA is a layabout. Don’t let anecdotes take your eyes of the crooks who took/are taking 2000 a second rather than 2000 a month.
Good point! Keep the focus on the biggest crooks on Wall Street — don’t sweat the small stuff…
True, but keep in mind there are literally millions of scams like this going on. The waste I’m am sure is in the $hundreds of billions. Is any of it sustainable?
-also, I am just reporting the scams I see around me and have no access to point out any big ones on Wall St. Anybody with inside info on that really needs to speak up.
IN WA we have a program called Shared Work, where the employer can reduce the hours of the entire workforce and the workforce can receive prorata UE benefits based on difference between 40 hours and the number of hours actually worked. All in all a pretty good program. The company I work for is on the program with most people working around 32 hours, so are claiming about 8 hours of unemployment/week.
So, I went to file my first week’s claim having worked 31.9 hours, but the state’s claim filing system won’t take anything but whole hours. So I called the state UE department and the gal said, “yeah, just round down”. So, I claimed 31 hours worked, was paid for 9 lost hours in effect receiving an additional .9 hours/week of benefits. Doesn’t sound like much, huh?
There are 50,000 people on the shared work program in the state (per the UE’s information sheet). If each collects an additional .9 hr/ week and the average comp is $10.00 hour (about 50% of base wage up to $30/hr), that works out to around $24million/year of excess payments because their claim program won’t take fractions of hours. Now that is government efficiency
In Florida the employee pays nothing in to unemployment insurance; the employer does. I suspect the same is true for California.
“…the cost of living is ridiculously inexpensive - rent like $700/mo for a decent 3br house. Aint life grand!?”
Cough! You can’t find any decent 3br houses to rent for much below $2000/mo in our ‘hood.
“Cough! You can’t find any decent 3br houses to rent for much below $2000/mo in our ‘hood.”
I thought the same thing ($1,500 for my ‘hood).
Where did they move to? Oil City, Florida?
I say again, it’s amazing how cheaply you can live if you’re not tied to an office and a commute…
I would happily live in rural NY, but no way would I live in rural Florida. And I don’t mean Palmetto rural, I mean Hernando rural.
hmmmm….. $700/mo. for “decent” seems cheap even by FL standards. i know Orlando’s market is one of the worst and compared to CA everything in FL is allegedly such a bargain, but here in Pinellas (St. Pete/Clearwater) a decent 1200+ sq.ft. 3/2 rental in an non-sketchy neighborhood would set you back at least $1200, i would think. of course, everybody’s definition of “decent” is a little different.
in the outer exurbs of most any FL big metro area, though, $700/mo. wouldn’t be too surprising.
The $700 price reflects the current dismal market - these were $1500 two years ago. New Smyrna beach, FL 32168 - check it out - nice quiet beach town.
As always, it depends where you are in Florida, but $700.00 a month in some areas, even for a decent older 3/2, is definitely not out of the question. I’m still waiting for it to happen around here, I think it might be another year, but even so, sometimes you can dig up a deal. Sometimes these older landlords are stubbon, like my LL. He’s a decent guy, I like him very much, but he held out for over a year for his price on one of his other properties, when he could have lowered the rent by $100 month. I suspect he’ll do that when the seasonal tenant is gone.
You can definitely rent a 3/2 in Northport or Spring Hill, though, for $700 or even less. Something tells me Cape Coral is the same. But it’s not a newer 3/2 we’re talking here. It’s a 1960s-1980s concrete block.
$500 a week?!
DAMN! The most you can get in Texas is $350 a week!
Oh, I forgot. The guy bragged to her that the California unemployment benefits will come for 18 months (he just started) and he intends to milk it for that long. I bet they get extended by our BS congress by the time that would run out anyway…
but you see, he deserves all that free money because he is a good citizen! I’ll put in an hour of extra work for free today, to help make sure he gets his freebies this month. Ability–> need.
Does CA have a whistleblower line for fraud. You might be able to get 10% of the savings for CA if you turn these clowns in. Let’s see 2k per month times 2 fraudsters times 10%, that’s an extra $400 per month for you.
Bean,
It wouldn’t be worth it for Press. It would strain his relationship with his girlfriend.
Press, go ahead and send me the information.
Sure, his name is Eddie. He used to post on this blog incessantly. Go get him!
And, for all of you tax fraud gumshoes, here’s a fun-filled reporting form from our friends at the IRS.
Your bro’ is smart. If lots of people are following his plan, that is a lot of housing demand straight down the drain, which could work out quite well for fence sitters who are unwilling to pay bubble-era home prices in the wake of a massive real estate bust.
The democrats are on a roll! But Bush was soooooooooo evil.
———————
Unions Want to Take Over Your 401(k)
Tuesday, 17 Mar 2009
By: Gene J. Koprowski
One of the nation’s largest labor unions, the Service Employees International Union (SEIU), is promoting a plan that will centralize all retirement plans for American workers, including private 401(k) plans, under one new “retirement system” for the United States.
In effect, government pensions for everyone, not unlike the European system and regardless of personal choice.
moneynews dot com/StreetTalk/unions-401k-pensions/2009/03/17/id/328862
This truly scares me. Yes I have tinfoil hat at the ready for just such an emergency, but NOTHING will suprise me anymore. The America I loved and trusted is dead and buried.
It might be time to roll over my old 401(k) to an IRA, is that safer?
“You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.” ―Morpheus
“It might be time to roll over my old 401(k) to an IRA, is that safer?”
Its always preferable IMO. Why limit yourself to a dozen or so choices offered by a 401(k) when you can have far more options open to you in an IRA? Yeah, most of the sheeple don’t want to spend the time to do the homework and research, but the reality is that the risk is all yours either way.
+1
You could try, but as the ship of states continues to sink, it won’t really matter.
They will come for every dollar, every scrap of wealth, we have to pay off their debts and make their own coffers fuller. That’s the way things end…
“Let them eat cake.”
That would most certainly have a negative impact on future 401K contributions. I believe sooner or later the government will confiscate all 401K accounts either outright or by taxation. Like a 25% “solidarity tax” on withdrawls for people that don’t have a 401K. Also the blood sucking Vampire Squid is probably devising scheme to heist some of that sweet 401K money.
The problem with a 401K is the the owner of the money has so little control over it. You can’t just get the money out and run when you see trouble brewing.
I am contributing the minimum to get the maximum employer match. Everything above that is a waste of resources. In 20 years when I am planning to withdraw that money the tax rate will most likely be significantly higher than today.
Does anybody know what it takes to get your money out? I would even pay the 10% penalty before gubernmint and the Vampire Squid completely drain all funds.
I did a non-hardship withdrawal a few years ago. The 10% penalty wiped out what gains I had, but it wasn’t a concern to me at the time.
As for how I did it, I called the plan administrator, explained I wanted to pull out a portion of the funds in my 401(k), and then spent a half hour getting bumped progressively higher as each tried to explain the folly of cashing in a portion of my 401(k). I had a couple legal forms to sign saying I acknowledged the penality and agreed to let the administrator withold the 10% penality plus income tax at whatever rate. A few days later I got my check in the mail.
The next January I got whatever tax form it is you get for these things…like I said, painless other than having to be on the phone, but I suspect in these tough economic times it is more common for participants to cash out 401(k) accounts so it might be less trouble now.
Hate to reply to my own comment…
I empahsize the “non-hardship” in my case.
I was young and dumb once (still half that…) and bought the 401(k) Flavor-Aide. Fresh out of school, with school loans and a love for fancy stuff purchased on a Master Card, I was dumping the 15% maximum into the 401(k) despite a match only up to 1.5%. One day I woke up and realized I was paying 18% interest on borrowed money and had a pile sitting there in the Ponzi scheme stock market game.
So I pulled enough to wipe out my debts. Best move I ever made, despite missing out on the great runnup to 14,000.
I pulled all my money out too.Paid off some debt at higher interest.I will not rely on the stock market for retirement.Seems like with the internet and day trading it is more of a casino than anything else.
I really dont want to retire anyway.If i’m sitting around doing nothing I go nuts.I can always do woodworking stuff for a couple bucks and keep me busy.
Bought the 401k flavoraide? That 6% that most companies match will buy a lot of flavoraide.
I understand and agree with the lack of options and control, but overall, I’d call a 401k a really good investment/retirement option.j As long as it is administered through a reputable company, then i’d call it dumb to dump your 401k and any company match for an IRA, especially if you have to pay the penalty.
If you want an IRA, just start one on top of your 401k.
Not me. I keep my 403b funded as much as possible. I like it. I have my paycheck down so low due to contributions to TIAA/CREF/Fidelity funds that if/when I retire, we really won’t miss the income. My employer will never go away cuz it’s a public institution, however. If they start to try to confiscate 401k money, the word will be out long b-4 it ever happens, and then of course I would remove it. Until then, there it rests.
“I really dont want to retire anyway.If i’m sitting around doing nothing I go nuts.I can always do woodworking stuff for a couple bucks and keep me busy.”
Bless you AZdude, finding a solution that only requires you to get out of bed in the morning…sawdust & coffee, thou scent of inspiration & motivation!
I’m with AZdude. Doing nothing drives me nuts. And everyone around me.
Mechanic I know retired from his job.
Ninety days later, his wife was calling all the shops on the airport, wanting to know if they had some work for him to do.
The short, very sad tale of a dear family friend:
Mr. & Mrs J…native Hawaiian’s, Mr. J works for 30+ years building up a commercial landscape business in LA…14-16 hours per day…retires, fit-as-a-fiddle…weighs 182 lbs
Their retirement: Hawaii, inherited 40 acres…8 mos later, @ 310 lbs …Mr. J has heart attack in bathroom, falls against door…Mrs J can not get it open…end of retirement for Mr. J
(A really really Great guy…)
I took the 10% hit on my former employer’s 401K in 2007, and got rid of my former employer’s stock. Figured a 10% hit on a $65/share stock was worth it, vs. a 90% hit to the value of the stock if I kept it (stock dropped to $8/share at one time, is only up to about $13/share now). Used the bucks to pay off all the credit card bills that I got stuck with during the divorce. (the ex- liked credit cards, but never wanted to help pay the bills).
“Does anybody know what it takes to get your money out?”
Aside from paying the 10% penalty? You can leave your job at which point you are eligible to rollover your 401(k) into a traditional IRA (no taxes or penalties for that).
Does anybody know what it takes to get your money out?”
Change jobs every 3 to 5 years and roll it to a IRA
works for me
I believe there is probably a vesting period for any employer contributions. Standard vesting schedule would be six years after hire to 100% vesting.
vesting period for any employer contributions’
yea if you get them, many employers have cut that part out
Socialize Retirement: Great idea. Socilalize everything, just not bonuses on Wall St …wait, those have already been socialized - just approved by the gestapo at very high levels. “Top Talent” is worth the big bucks - the pay-czar is on it and he says its all good.
Rant Warning:
The people of this country need to jettison this retirement obession right here and now. It’s the scam of all scams and it rivals the housing bubble in its social destructiveness.
Over and over again the word retirement is drummed into our heads - everyday there’s a link and major sites asking: “have you saved enough for retirement?”, “how much is enough for retirement?”. It’s everywhere in this culture - the ultimate carrot to conjure up more OPM to play with.
I’ve spent most my life dealing with seniors and illnesses and retirement for the vast majority of Americans will not resemble the TV commercials put on by the investment houses. Not even close. This is a lie and any attempt to further rob the working, young and unborn to feed this sadistic fantasy is an abomination!
Besides, they will change the rules just before you can grasp that carrot - it’s called MEANS TESTING!
Edgewater, what are you proposing- that everyone work until they die?
I think that’s a given for about 80% of the population.
Anything I might suggest is meaningless, because wider circumstances will likely impose that on many regardless.
Here’s the retirement savings paradox:
The aggregate real cost of living continues to rise. (House prices might decline, but so are wages. And then there’s taxes and insurance.) In response people are obliged to save more and more to prepare to handle these rising costs. In so doing they amass little fortunes that are irresistible to the bankers and politicians and at the mercy of same.
So, the accepted methods of retirement saving and the accepted ideals of retirement may need to be questioned on the individual level because by now it should be quite obvious that they’re going to come looking for any pot o’ gold they can find and the average person has no defense under the current arrangements.
One has to admire though, how they managed to twist what many consider to be the ultimate escape into what could be the ultimate trap.
edgewaterjohn
Absolutely correct. I will not be able to retire. I’m in N Louisiana and my pension is soooo underfunded.
I’m gonna crap my diapers and fall dead over my walker. That is my retirement plan. It is the only one that will be there for me.
Roidy
Retirement will be the exclusive domain of the bloodsucking leeches, who can afford to pay for the best in medical care.
With my family history of dementia/Alzheimer’s, I’m shooting for the massive coronary/stroke at approx. age 70. No sense of living until 80, if the last ten years of it will be spent crapping/whizzing on myself, and not recognizing anyone.
We’re all cannon fodder, as far as the “ruling classes” are concerned. Totally interchangeable with Juan6P and Xian6P, but with higher overhead costs.
The only reason that Social Security/Medicare haven’t had their budgets hacked is that the “greatest generation” still has the clout to vote people out of office. When the only old folks left standing are the reduced expectations generations, expect the budget cutting/means testing to begin.
We’re all cannon fodder, as far as the “ruling classes” are concerned. Totally interchangeable with Juan6P and Xian6P, but with higher overhead costs.
+1000
Never forget this.
“I’m gonna crap my diapers and fall dead over my walker.”
How come I had the only laugh of the day over such a sad topic?
I doubt there will be jobs for people to work until they die even if they wanted to, so that plan might not pan out.
How will they means test and for what services?
I’ve spent most my life dealing with seniors and illnesses and retirement for the vast majority of Americans will not resemble the TV commercials put on by the investment houses. Not even close. This is a lie and any attempt to further rob the working, young and unborn to feed this sadistic fantasy is an abomination!
My mother retired from teaching in the mid-1990s. I’m of the firm belief that retirement has been the worst thing that ever happened to her. She’s been in a state of low-grade depression ever since she left the classroom. It’s now starting to affect her physical health.
As for my dad, he’s a research engineer. And the quintessential absent-minded professor. That tendency is a bit more pronounced these days (he’s 85), but when he’s in the lab, he’s just as sharp as ever.
Needless to say, retirement is not among my life’s goals.
It’ll be five years for us in May. Bored? Heck no. We actually look forward to the occasional down day, where there’s nothing on the calendar.
I can’t tell you how many guys I know that passed away less than a year after retiring. There are a lot of people out there who only get up in the morning because they have a job to go to. Hobbies/passions are mostly just you do a few hours a day to relax, not to replace a 40 hour a week job. Sad, but it’s the truth.
Between women and the MSM telling men they are not needed, and the economy reinforcing that view, you are going to see a big jump in suicides among 40 plus y/o men.
“Between women and the MSM telling men they are not needed..”
What do Jesse James & Tiger Woods have in common? (I mean besides that they both own a SUV)
A real question, or is there a joke here somewhere?
Answer: Guys with bucks, who should have stayed single.
(Absolutely nobody would be calling Tiger Woods a “sex addict” if he was single…….WTF is a “sex addict” anyway? If the term means “getting it as much as he can”, that term would apply to about 100% of the guys I know)
Yeah X-GSfixr, I was hopin’ to draw out mystery woman #27, …the one who has “first hand” evidence of their phenotypical commonality.
“The people of this country need to jettison this retirement obession right here and now.”
Geez, common sense is just oozing out this morning…
I’ve found this week that I can bareboat charter a 43′ Catamaran for 10 days in the South Pacific this August for 50% off ( ’bout time!)… cost would be around $2,500
(Caution: This is soley Hwy’s POV… not meant as “financial advice”)
So here’s how I rationalize the reason for not depositing this money in my “retirement” account this year…At age 53 I feel great and have no hesitation of skippering around the Pacific with Mr. Cole age 8…or… I could wait until I’m age 71, use the accumulated money and just hire a Captain, then again, Mr. Cole would be 24, and might be able to skipper himself and save the OLD MAN even more RETIREMENT money…see it never ends… this ability to keep saving… ’till you die.
At age 53 I feel great and have no hesitation of skippering around the Pacific with Mr. Cole age 8…or…
If you have the opportunity, hell, it sounds great! Sounds like an amazing adventure for an eight year-old.
I plan on croaking at the local VFW bar, drink in front of me, telling the biggest lies about combat for anyone to hear…
Agreed Edgewater.
Now my husband and I put money by, but we have no plans to stop working. Ever. The reason why workers dream longingly for the day they don’t have to work anymore (”retirement”) is because most people are stuck in jobs that they hate. The one thing that never gets taught in our educational system is how to find rewarding, satisfying work based on your talents, skills, and interests.
If people actually enjoyed what they were doing, why would they want to stop working (barring being physically unable to do so)?
My husband and I also take a trip somewhere on the globe that we’ve never been every other year. That gives us two years to put money aside to pay cash. None of this “waiting for retirement to travel” when I could be hit by a car and die crossing the street between my office and the parking garage this afternoon.
Life is too short to do work that you don’t love and put off “living” until retirement.
“The reason why workers dream longingly for the day they don’t have to work anymore (”retirement”) is because most people are stuck in jobs that they hate. The one thing that never gets taught in our educational system is how to find rewarding, satisfying work based on your talents, skills, and interests.”
But if you teach people to “follow their bliss” you won’t have a worker class to do the dirty stuff.
Not necessarily. There are plenty of people who enjoy doing dirty jobs.
Now, now. Enough with the self congratulation. There are other reasons to want to quit working and retire other than hating your job.
Most jobs that pay enough to subsidize kids’ college educations are in urban areas. I’m in Northern Virginia, home of the worst local, Beltway and I-95 traffic in the country. Recovering from a wrong turn can take twenty minutes, between the traffic and the four minute lights.
Coming from CT, I very much like the energy here, and the fact that people are willing to look you in the eye and smile at the grocery store. I like the fact that, since there is enough to go around, a conversation - however brief - becomes a normal feature of life again.
BUT. I long for my own piece of dirt. I mean, real, rural dirt complete with a garden and chickens, enough trees for a woodlot, and a porch from which to watch the dogs be lazy and the rain come down. Farmer Jane I’m not - got no illusions about trading my tomatos for my neighbor’s tomatos for pocket change. But paring down my life and having enough time to read and walk the dogs - mostly, a decent place to walk with them that’s not concreted over - now THAT’s what I’m talkin’ about.
You can keep yer travel, although bless you for enjoying it and having the gumption to follow your bliss! I want away from them dadburn cars, airports and traffic light things.
Don’t we already have all pensions under US gov control. I believe the vast majority are under capitalized and will eventually collapse.
Corinthians, I enjoyed most of my professional jobs. But as time went on, and companies expected you to remain connected/available 24/7, and do more work per person as staffs were shrunk year after year, it became a real PITA.
Now every week consists of six Saturdays and a Sunday. In our case, we only know it’s Sunday because the newspaper is fatter. My wife and I share the household duties so we both have time for fun stuff with the many friends we’ve made here in our community of fellow retirees. And the network that exists here is phenomenal. Less than half the people who lose their spouse decide to leave. One widow lost her husband eight years ago now, and is still enjoying it here.
Our good health won’t last forever. Sooner or later the first of us will simply fail to wake up one morning (ideal outcome) or endure an unpleasant and possibly agonizing decline that may last months or even years. In the meantime, we stay involved and stay active, both physically and mentally. Carpe diem!
03/23/10 Paris, France – Zombies Take Over US Health Care!
B.Bonner
“Obama assures his place in history,” says the editorial in today’s Financial Times.
“Poor fellow. He’ll be remembered as the guy who let the zombies loose on the US health care industry. It wasn’t a very good industry even before passage of the reform bill. Not because of the doctors and nurses; they’re as competent as other professions. But they’re forced to work under appalling conditions – with lawyers, lobbyists and regulators on their backs”!
“This new reform measure just increases the weight. Now, there’ll be more parasites than ever. Health care is about to turn into a zombie industry… run by brain-dead bureaucrats and kept alive by infusions of blood from the taxpayer”.
“Obama should veto the bill,” says an American friend. “He should go on TV and tell people that he wants real reform of the health care business… not a 1,000 page document full of bribes and boondoggles. That would really assure him a place in history.”
“But that’s not going to happen. Instead, the president will sign the bill, smile in triumph, and the health care sector will come under US government control. One by one, step by step, deficit by deficit… the feds take over the economy”.
“Banks… mortgage finance… insurance… automobiles… passenger trains… and now health care”.
And Hwy is cheering them on.
“You betcha by golly!”
All I hear from the Repubs is “let the free market work”. IOW, the status quo. Which isn’t working for about 30% of the population. Arguably, the poorest 30%. Not a problem, they don’t vote for Republicans anyway. (So we have a chicken/egg scenario……..are they poor because they are Democrats, or did they become Democrats because the Republicans didn’t give a flying fook about helping address their problems?).
They had from 2000-2006 to get ahead of the power curve, and didn’t do anything, other than start a drug giveaway program. Now, they are throwing hissy-fits/tantrums, and doing a pretty good imitation of two year old brats.
Lil Opie: “I’m gonna hold my breath Pa”!
Andy: “Yep, I reckon you are…”
Which isn’t working for about 30% of the population.
So do you blame republicans or the 30% of the population that cant take care of themselves?
The Democrats in Congress and the White House have forced upon the United States of America a federal health care plan designed for people who are “too stupid, incompetent and weak” to manage their own affairs.
Such people certainly do exist among us, but to gear the nation’s health care system to them is a terrible idea. Unless, of course, one happens to be part of our new ruling class.
http://www.cleveland.com/obrien/index.ssf/2010/03/kevin_obrien_dont_let_up_until.html
Besides you and a few others, most people don’t really like rising costs and declining services.
In fact, most people can’t afford it.
As for “too stupid, incompetent and weak” to manage their own affairs… let me know how sending millions of jobs overseas is within the average person’s control. Or bank bailouts. Or inflation. Or serious illness.
“and the health care sector will come under US government control. One by one, step by step, deficit by deficit… the feds take over the economy”.
“Fascism should more properly be called corporatism because it is the merger of state and corporate power.” — Benito Mussolini …
Of course, the Neo-prog O-bots would prefer you call it “healthcare reform” rather than “death panels”; and “National Socialized Medicine” rather than “Obama Crypt-Care”.
For myself, the “2010 Power Grab and Trillion Dollar Heist” seems the most decriptive.
“To truly succeed in resetting the terms of American politics, corporations needed to systematize their approach, creating new institutions and giving those institutions sustained support.
The most important development came in 1972, when Frederick Borch of General Electric and John Harper of Alcoa spearheaded the formation of the Business Roundtable, an organization made up exclusively of CEOs from the top 200 financial, industrial, and service corporations.
Because of the composition of its membership, the Roundtable occupied a position of unique prestige and leverage. It functioned as a sort of Senate for the corporate elite, allowing big business as a whole to set priorities and deploy its resources in a more effective way than ever before.
For example, in 1977, major corporations found themselves divided over a union-backed legislative proposal to reform and strengthen federal labor law and repeal the right-to-work provisions of the Taft-Hartley Act. Some members of the Roundtable, such as Sears Roebuck, strongly opposed the legislation because they believed it would provide
leverage to their low-paid workforces to unionize. On the other hand, members whose workforces had already unionized, such as General Motors and General Electric, saw no need to oppose the legislation. However, after the Policy Committee of the Roundtable voted to oppose the legislation, all the members of the Roundtable joined in the lobbying efforts. Political scientists mar the defeat of the legislation as a watershed.”
-Gangs of America (Ted Nace)
DOW less than 100 away from 11,000 …. Party on baby!
Pssssst….Hey Fed, the new bubble is in the stock market (just trying to help, I know you guys are pretty bad at Where’s Waldo when it comes to bubbles).
I suspect they may only be able to notice bubbles that are not of their own deliberate creation.
Buy now or miss out on the maasive gains.
Fortunately I was able to convince one of our kids not to get off the elevator when it stopped in the basement last March.
Any thoughts on how soon the elevator will reach the top floor, then head back to the basement? I am thinking perhaps after the Fall 2010 election season, but that is just a guess…
I thought it was “sell in May and go away”
Well that’s the best I can do
I like the concept of them crashing it after the elections - and then demanding another Bailout, of course.
Even in a valley of Elephants,…there are “nervous” ants that thrive.
PB, I wouldn’t even try to guess.
From a WSJ article some years back- “There’s a small god on the trading floor who allows anyone to guess the top correctly once, guess the bottom correctly once, and be wrong as many times as he or she would like.”
My correct guesses ran out long ago.
Florida Bill To Cap & Roll Back Public Employee Pensions:
For those who think that the state mess isn’t going to have a big impact, you need to read this bill. This, incidentally, is from a state (Florida) that is allegedly one of the best in terms of its public-pension status - those of you in Illinois, New York, California and others are in much worse shape.
Let’s recap what this bill does:
•Increases employee contributions for all future hires and many current employees by 1% to the pension plan.
•Actuarial disclosure (and public posting of same) must be regularly performed and corrective steps identified to halt and reverse any unfunded liabilities.
•Pensions are now computed based on the average compensation during the employee’s term of employment, not the last five years, and explicitly exclude any and all overtime or other “cramming” attempts. Further, the pension paid is capped at that average compensation. All “hazard pay” riders (e.g. additive amounts for police, fire and similar employees) are ended. Lump sum payments, annual leave payments (for vacation not taken) and similar are excluded. In short, only your base salary counts, and the average across your entire term of service is used, ending the abuse of playing games in the last couple of years to “goose” pension returns.
•Retirement ages go up materially. The minimum retirement age is now typically 60, and with the exception of “special risk classes” (e.g. cops) you now need 33 years of creditable service. Pension payouts now cannot start before age 62 if retiring before July 1st 2011 and 65 thereafter. For “special risk” classes the prior 55 year age lifts to 60 as of July 1st, 2011.
•Municipalities can close their defined benefit plan, choosing instead to offer defined contribution plans (e.g. 401k equivalents.) An existing employee can transfer out of the pension system to that 401k-style system, but if they do they cannot transfer back to the pension system.
•Finally, there is no grandfathering - this applies to all current and future employees, without exception.
(From K. Denninger)
Does this logical bill have any chance of passage?
Wow, no grandfathering. Surprising. Necessary but surprising.
Ambac May Seek Bankruptcy Protection
25 Mar 2010 ~ Reuters
Troubled U.S. bond insurer Ambac Financial Group said on Thursday it was open to seeking a negotiated restructuring of its debt through a pre-packaged bankruptcy proceeding.
The company said it would transfer certain liabilities of its principal unit Ambac Assurance Corp (AAC) to a separate account following a directive from Wisconsin insurance regulator.
The Office of the Commissioner of Insurance of the State of Wisconsin (OCI) informed Ambac that transfer was necessary to address AAC’s financial position, the company said in a statement.
Some of AAC’s policies relating to credit derivatives, residential mortgage-backed securities and other structured finance transactions will be transferred to a segregated account backed by a $2 billion secured note issued by AAC.
Better duck, or you’ll get goosed.
How dare they be going bankrupt right in the middle of the recovery. Can’t congress vote on this?
So I just checked out the holdings of SPY. IBM is 9.2% and 3M is second at 6+%. So do these two companies account for more than 1 out of every 7 dollars of economic activity/capital/profits/revenues of American corporations?
hmm… i peeked at Marketwatch’s SPY Company profile page, and while IBM is listed 7th in the top 10 holdings, it’s only 1.67% of total.
3M doesn’t make the list.
Exxon Mobil is 1st at 3.09%
and another thing.. according to wiki, Standard & Poor’s Depositary Receipts (NYSE: SPY)
..One SPDR unit is valued at approximately 1/10th of the value of the S&P 500…
my bad, it was DIA “diamonds.” Weighting still seems peculiar. And does S&P500 or DJIA include “American” corporations that have reheadquartered themselves to Grand Cayman, etc?
China faces diabetes epidemic: report
An other bubble for china
http://www.breitbart.com/article.php?id=CNG.d76971f4d634ed962c96f8439bae145e.821&show_article=1
OlyGal’s Ghost 1, San Diego County developers 0
Supervisors reject Merriam Mountains project
By Eleanor Yang Su, UNION-TRIBUNE STAFF WRITER
Originally published March 24, 2010 at 1:44 p.m., updated March 25, 2010 at 2:23 a.m.
Rob Peterson, who lives near the proposed Merriam Mountains development, hugged his wife Cinde Peterson after the supervisors’ vote rejecting the proposal.
“They pretty much said no plan like ours is going to go anywhere anytime soon,” said Joe Perring, project manager of Merriam Mountains.
- Union-Tribune
Supervisor Ron Roberts had missed the previous vote on the plan and asked for a rehearing.
SAN DIEGO — After the county Board of Supervisors rejected building nearly 2,700 homes near Escondido, opponents of the project hailed Wednesday’s 3-2 vote as a warning that other developers keen on urbanizing rural stretches of the region might need to rein in their ambitions.
But the Merriam Mountains developer and Supervisor Bill Horn said the action sacrifices thousands of construction jobs and hurts efforts to create well-planned communities near existing freeways.
“Unfortunately, the message sent by the votes of three members of this board is that there is a de facto moratorium on building in San Diego County,” said Horn, who was joined by Supervisor Greg Cox in supporting the project.
In siding with the majority, Supervisor Dianne Jacob said she’s not against all new development, just this one.
“Wrong project, wrong time, wrong location,” she said.
…
Yay for Oly’s ghost!
Rrribet, rrribettt
But there is plenty of water whats the problem ?
1) No housing demand for outlying areas right now, given how far prices have fallen in more desirable parts of SD County.
2) Plenty of empty housing inventory in closer to the SD city center, once it eventually leaves shadow inventory and hits the market.
3) New homes are getting built closer to the SD city center as I type.
4) Fire hazard is extreme in them parts — directly in the exhaust path of the Santa Ana blast furnace that shoots firestorms down towards San Diego most Octobers.
5) It is a beautiful, pristine area far removed from San Diego proper.
6) There is plenty of undeveloped land closer to downtown San Diego.
In short, the development would produce unneeded, unwanted, unaffordable housing where it is not needed in a scenically attractive area with high fire hazard.
The Great Disconnect: Stocks 30% Overvalued and Still Going Up … and Housing Rolling Over
Mar 25, 2010 Henry Blodget in Investing, Recession, Banking, Housing.
The Business Insider
We don’t mean to rain on the stockmarket parade (we’re enjoying it, too), but we’ll confess to being astonished by it.
We understand that the world’s governments are pumping money into their economies. We understand that that money has to go somewhere. We understand that, right now, that somewhere is often stocks.
We also recognize that the stock market is “forward looking,” meaning that stock investors couldn’t care less about 10% unemployment and other depressing facts about the economy. As far as stocks are concerned, as long as the situation is improving, it doesn’t matter how bad the present is.
But we’re looking forward, too, and here’s what we’re seeing:
The housing market, a huge engine of the U.S. economy via both direct spending and the wealth effect, is rolling over and heading for a double-dip. This despite the fact that the government is still spending money hand over foot to keep house prices propped up.
In a week or so, the Fed is supposed to begin withdrawing some of this housing subsidy by winding up its mortgage-buying program. The Fed may or may not actually do this, but if it does, this move could further depress the housing market. And that, in turn, could put more pressure on strapped consumers who can no longer borrow from home-equity lines to fund current spending, no longer feel rich, don’t have much borrowing capacity, and, often, no longer have jobs. (And consumers still account for more than 70% of spending in the economy).
A falling housing market will also likely lead to more underwater homeowners, more “shadow” inventory, more foreclosures, more pressure on house prices, and, possibly, more bank write-offs. The more banks are worried about future write-offs, the less likely they are to lend, and bank lending has already fallen off a cliff.
So, basically, we think the apparent double-dip in the housing market is a big deal, and we’re surprised that the market is whistling Dixie in the face of it.
Man I hope chumps like the Chinese keep buying bonds! I would just hate for the party to end so soon and for the bill to arrive.
Better buy into the market right now or be priced out forever! It’s amazing, the only alternative to the housing bubble seems another stock market bubble. Why not tulip bulbs or Beanie Babies? Fairy dust? Anybody trading in fairy dust?
Com’on, another stock market bubble is pretty boring, been there done that. That’s the best the geniuses on Wall Street can come up with?
Two words:
Beer Bubble
Now that I could deal with
Buy now or be priced out forever!
I’m goin’ all-in on beanie babies! They are coming back once the Chinese start collecting ‘em.
Well good luck with that…here in the US of A the “retired” ones were supposedly like this: #356 of 1,000,000 …but in China it’s gonna be more like this: Peter Panda is being “retired”… this is on sale for 452 Yuan the tag says:
1 of 2,967,657,324
Blodget is a scuzzball. I’d take his advice with a grain of salt.
Bill Gross says the 30 year Bond market Bull Run is over and inflation will return, stocks will do better than bonds or cash if this is true
Don’t ask me I have no clue ? we in a controled economy and I suspect the real outcome will be shortages of all kinds of things.
and higher taxes but that has already happened I guess.
FDIC tells Bank of Florida to raise money or find a buyer
Tampa Bay Business Journal ~ 3-25-10
The Federal Deposit Insurance Corp has issued prompt corrective action directives to Bank of Florida-Tampa Bay and two other subsidiaries of Bank of Florida Corp.
The directives, which impose restrictions on bank operations, were issued to the banks because of their undercapitalized status, a filing with the Securities and Exchange Commission said. Bank of Florida-Tampa Bay is “significantly undercapitalized” while Bank of Florida-Southwest is “critically undercapitalized” and Bank of Florida-Southeast is “undercapitalized.
The directive gives the banks until April 17 to boost capital to the “adequately capitalized” level and/or accept an offer to be acquired by another banking firm. If the banks don’t meet the requirements of the directive, the FDIC likely would impose a consent order, or close the banks and put them into receivership, the SEC filing said.
Looks like more Americans are turning to these health food restaurants…
Hardee’s parent CKE’s profit jumps to $15M in Q4
St. Louis Business Journal - 3-25-10
CKE Restaurants, parent of St. Louis-based Hardee’s and Carl’s Jr. fast food chains, said Wednesday its profit jumped nearly sixfold in the fourth quarter, partly due to a $9.9 million tax benefit.
The Carpinteria, Calif.-based company reported a profit of $15.4 million for the quarter ended Jan. 31, up from a profit of $2.6 million a year earlier.
Five Guys ranks as fastest-growing chain
Washington Business Journal
Five Guys Burgers and Fries ranked as the fastest-growing restaurant chain in the nation in 2009, according to data compiled by restaurant consulting firm Technomic.
Five Guys had $453 million in 2009 sales, a 50 percent increase over 2008 revenue, led by rapid expansion of its franchise locations. That ranks it No. 1 for sales growth among chains with sales over $200 million.
Tim Hortons ranked No. 2, with $446 million in 2009 revenue, a 23 percent increase. Buffalo Wild Wings Grill & Bar ranked No. 3, with $1.5 billion in sales, up 22 percent from 2008.
Five Guys ranks as fastest-growing chain
Washington Business Journal
Nothing like a little Obama love, eh? One wonders how Ray’s Hell Burger (another Obama fave) is doing these days.
I work about 2 blocks from Ray’s Hell Burger in Arlington, and it’s always busy.
Gotta spend that unemployment check on something tasty.
I was driving on I-70 this morning……..normally (meaning the time between 1970 and 2008 to me) you start seeing the U-Hauls and moving trucks about this time of year. Saw exactly one this morning in 70 miles (and it looked like a college kid).
It’s early yet, but does anyone track moving activity, and where those trucks are moving to/from? A way to identify the location of “green shoots” and bubble markets?
link posted yesterday or day before.
http://www.atlasworldgroup.com/migration/
Underwater home debtors seldom move.
“Plugs”Biden: Without Health Care Obama Would Be ‘Absolutely Done’
Major Garrett - FOXNews.com
The vice president told a fundraising audience the White House would have been doomed without it.
Although President Obama repeatedly said he had no idea how health care politics would play out, Vice President Joe Biden told a fundraising audience Wednesday the White House would have been doomed without it.
“If we were unable to move the ball on this issue, not only in the political sense might we be dead,” Biden said, according to the pool report filed on the event. “But in terms of being able to deal with other major issues on our plate, we would’ve been done. Absolutely done.”
Biden appeared at a $2,500 per-person fund-raiser at the home of mega-developer David S. Cordish in Lutherville, MD., north of Baltimore.
Biden also addressed his F-bomb when he was picked up on an open mic telling President Obama signing health care was “a big F#*king deal.”
It was clear late last year that without some kind of a health care bill Obama’s done.
But I am surprise they are openly admitting it.
I’d say good riddance, but like a Kudzu vine that you spay with round-up it will come back. This crowd of lowlife parasites will just morph into a new group.
ACORN Office in Washington Starts Shutting Down
WASHINGTON — A “for lease” sign has been posted in the window of the Washington office of ACORN.
The community activist group announced Monday it is folding amid falling revenues. The closure comes six months after video footage emerged showing some of its workers giving tax tips to conservative activists posing as a pimp and prostitute.
Several ACORN chapters elsewhere in the country have split off and are rebranding, but ACORN spokesman Kevin Whelan says he doesn’t expect that to happen with the Capitol Hill location. Like other ACORN offices, Whelan says the D.C. office will be closed by April 1.
Several years ago, I was at a meeting for Tucson neighborhood activists. At one point, a very indignant neighborhood association officer had a warning for the rest of us.
Seems that ACORN organizers were going door to door in his area, and they were telling people that there was no association to represent them. And, since there was no association, well, ACORN would be happy to help them start one.
Well, that was news to this guy. ‘Specially since he was an officer of the neighborhood association. And that association had been around for a while.
Long story short, the organizers from ACORN found other things to do in Tucson. And, trust me, if they’d come into this nabe with their “no association” pitch, I would have called the President for Life of our neighborhood association. She’s a veteran of the U.S. Marines and she knows just what to do with ACORNs and other nuts.
Pardon me while I plug a “pet” cause of mine: Bunny Rescue
http://www.3bunnies.org/easter.htm
People buy rabbits as gifts on Easter. They are difficult pets to take care of, and few people have the commitment necessary to properly socialize, play with, and keep the animal healthy.
Please don’t buy a live animal as a gift on Easter!
They are difficult pets to take care of, and few people have the commitment necessary to properly socialize, play with, and keep the animal healthy.
The same is true for all sorts of pets. They’re not just cute little playthings. They’re a commitment.
I’ll take them all off their hands.
Hasenpfeffer?
True story - 2 years ago I saw something out of the corner of my eye scoot under the deck through a hole. I figured it was a rat, so I set out a rat trap - the classic snap kind. About three weeks later - one week after Easter this was - there was a small bunny in it. I felt pretty bad.
And I decided not to show it to my then-3-year-old daughter.
Old Sammy Bin Ladin has been dead for years IMO. These clowns keep putting out these tapes like someone is paying attention to them, or gives a crap…
Osama bin Laden, in tape, threatens to kill Americans
Mar 25, 2010
DUBAI, March 25 (Reuters) - Osama bin Laden, in a fresh audiotape, threatened to execute any Americans taken prisoner by al Qaeda if accused Sept. 11 mastermind Khalid Sheikh Mohammed is executed, al Jazeera television reported on Thursday.
Will I Live to see 80?
I recently picked a new primary care doctor. After two visits and exhaustive Lab tests, he said I was doing ‘fairly well’ for my age. (I just turned 56.)
A little concerned about that comment, I couldn’t resist asking him, ‘Do you think I’ll live to be 80?’ He asked, ‘Do you smoke tobacco, or drink beer or wine?’
‘Oh no,’ I replied.. ‘I’m not doing drugs, either!’
Then he asked, ‘Do you eat rib-eye steaks and barbecued ribs?
‘I said, ‘Not much… My former doctor said that all red meat is very unhealthy!’
‘Do you spend a lot of time in the sun, like playing golf, sailing,
hiking, or bicycling?’
‘No, I don’t,’ I said.
He asked, ‘Do you gamble, drive fast cars, or have a lot of sex?’
‘No,’ I said.
He looked at me and said,… “Then, why do you even give a shit?”
LOL - that’s awesome.
‘I said, ‘Not much… My former doctor said that all red meat is very unhealthy!’
wmbz
What was her name, your former doctor?
Thanks wmbc.
I just forwarded it to my daughter, a 2nd year med resident primary care doctor in Baltimore.
NG probably better economic barometer than oil ?
NEW YORK (AP) — The futures contract for natural gas tumbled to its lowest price on record Thursday after the government reported that supplies grew for the first time this year, adding to already bloated reserves.
The country had been burning large volumes of natural gas to heat homes and run power generators this winter as heavy snowstorms blanketed parts of the country. But the drawdown wasn’t enough to erase huge surpluses built up during the past few years.
The Energy Information Administration said that at 1.63 trillion cubic feet, natural gas levels are 8 percent higher than the five-year average.
Natural gas for April delivery dropped 15.9 cents, or 4 percent, to $3.946 per 1,000 cubic feet, on the New York Mercantile Exchange. Prices fell as low as $3.940 earlier in the day, the lowest on record for the April contract
“…supplies grew for the first time this year, adding to already bloated reserves.”
I suppose this was somehow due to the weather? And that despite all those record snow falls this winter?
Go figure…
Between the Democrapts & Repubicans, anyone surprised by a record surplus of this American Commodity?
Bloated Reserves… “Natural gas price drops 4 percent”:
Chris Kahn, AP Energy Writer, On Thursday March 25, 2010, 2:18 pm
NEW YORK (AP) — The futures contract for natural gas tumbled 4 percent Thursday after the government reported that supplies grew for the first time this year, adding to already bloated reserves.
The country had been burning large volumes of natural gas to heat homes and run power generators this winter as heavy snowstorms blanketed parts of the country. But the drawdown wasn’t enough to erase huge surpluses built up during the past few years.
The Energy Information Administration said that at 1.63 trillion cubic feet, natural gas levels are 8 percent higher than the five-year average.
sorry, didn’t refresh the page meatson
Still haven’t heard from anyone regarding the value of the US of A… including the other 49 co-joined appendages…and I means the WHOLE SHEBANG…including replacement cost & labor!
California’s $3.4 Billion Taxable Offer Gets 30% Foreign Buyers
By A. Catarina Saraiva
March 25 (Bloomberg) — California priced $3.4 billion of taxable debt today, including $2.5 billion of Build America Bonds
Qwest seeks $350M from stimulus for rural broadband
Denver Business Journal
Qwest Communications International Inc. said Thursday it is applying for a $350 million federal stimulus grant to help it extend high-speed Internet service to rural areas of its local phone-service region.
The Denver-based telecom (NYSE: Q) had signaled in January that it was reconsidering its earlier decision not to apply for available rural-broadband funds under the American Recovery and Reinvestment Act because of what it called unrealistic rules. But those rules were later revised. (DBJ report.)
Qwest now will ask for the stimulus funds to cover 75 percent of the cost of a planned $467 million project to extend broadband service with download speeds of 12 to 40 megabits per second (Mbps) to more than half a million homes, schools, businesses and hospitals in rural communities in Qwest’s 14-state service territory. Qwest would cover the remaining $117 million itself.
I gotta little story to tell everyone.
Years ago, when at the rental place I dwelt in before I moved here, I decided that I needed a snappier Internet connection for my studio. It was getting to the point where telling a client that I’d look at his site after we got off the phone was, shall we say, a tad unprofessional.
I needed DSL so I could chat on the phone and view the client’s site at the same time. And, no, cable Internet was not an option. Landlady nixed that idea because of botched cable installations at her other properties.
So, to Qwest I called, hoping that the local phone monopoly could provide me with some o’ that DSL they touted so heavily. “No, sorry! No DSL for you!” was their answer for many years.
Finally, a few months before I moved, I was told that, yes indeed-y, I could get DSL. So I did. And I really liked it. So did the clientele.
Well, comes November 2004, and it’s moving time for Arizona Slim. I called Qwest once again and ordered DSL for my new address. The Arizona Slim Ranch was gonna have the DSL that I’d had at the rental.
After I moved in, different story. No DSL available at this address. So, I called the local cable teevee monopoly, Cox Communications, and ordered their Internet service. Which they came and installed.
A few days after Cox was outta here, I got another call from Qwest. Seems that I’d been given incorrect info. I could indeed get DSL here. Sorry, I said. The installation’s been done.
Now, mind you, I’ve told you the story of how Cox has charged me for teevee, even though I don’t have one, and the only installation they’ve ever done here was for the Internet access. But Qwest doesn’t rank very high with me either. I ditched their landline service for VoIP a couple of years ago.
If Qwest’s glacially slow rollout of DSL within a densely populated place like Tucson is any indication, it’ll be a cold day in July before these rural areas see any broadband.
“If Qwest’s glacially slow rollout of DSL within a densely populated place like Tucson is any indication, it’ll be a cold day in July before these rural areas see any broadband”.
I thinking ‘Ol Qwest is drooling over a possible 350 million dollar Grant. Funny how so much grant money is handed out, and rarely do we get the results of said ‘free’ money.
Treasury Will Soon Have to Pay More to Finance Growing Debt
25 Mar 2010 ~ CNBC
The US government could soon have to reward investors more handsomely for helping to finance its debt.
Treasury auctions this week served notice that the market is beginning to reach a saturation point as hundreds of billions flow in every couple of weeks.
An auction of five-year notes—a traditionally attractive denomination and not much of a test for investor resolve—flopped and sent yields sharply higher.
The market is awaiting today’s $32 billion auction of seven-year notes for further indication about the future direction of rates.
“People yesterday were talking about the bond vigilantes,” Matt Zeman of LaSalle Futures Group said in an interview with CNBC. “If you’re going to continue to auction off record amounts of debt—you’re going to spend, spend, spend—hey, we’re going to make you pay for it.”
Wow - holy cow “flop” is right. In the last two days yields went from 2.40 to 2.66 - that is a huge rise in such a short time. Same thing happened to 10-year and 30-year also BTW.
The 30-years just hit a new post-crisis high of 4.78. Last time it hit 4.8 was 6/2008 - and then only briefly touching it. The last time before that it hit 4.8 was 8/2007.
Ruh roh Shaggy (noting that the 2-year chart doesn’t yet indicate the last two days’ jump up to 4.78.
To top that off - note that the spread between mortgage rates and treasury yields has been at record lows lately, obviously due to the Fed MBS purchases. And guess what? They’re scheduled to end next week.
Doh.
Mortgage rates could go from 5.0 to 6.0 in just a matter of a couple of weeks.
“Mortgage rates could go from 5.0 to 6.0 in just a matter of a couple of weeks.”
A closely watched pot never boils over.
how long would it take to get to 14+% ?
P.S. This might have something to do with there being $223 Billion of new debt in just the past 3 weeks - on pace for a record month.
Pimco’s Bill Gross Says Bonds Have Seen Best Days (Update2)
March 25 (Bloomberg) — Bill Gross, manager of the world’s biggest bond fund at Pacific Investment Management Co., said the almost three-decade bond market rally may be drawing to a close.
Excess borrowing in nations including the U.S., U.K. and Japan will eventually lead to inflation as governments sell record amounts of debt to finance surging deficits, Gross said. Pimco, which announced in December that it would offer stock funds for the first time, is advising that investors buy the debt of counties such as Germany and Canada that have low deficits and higher-yielding corporate securities.
“Bonds have seen their best days,” Gross said in a Bloomberg Radio interview today from Pimco’s headquarters in Newport Beach, California. “We are focused more in spread space than in yield space. Durations should be shorter than index and you should be taking a little more risk in terms of spreads.”
Yields on two-year U.S. Treasury notes are likely to rise to 1.25 percent to 1.5 percent from 1.08 percent in the next year as the economy strengthens and the Federal Reserve begins to increase interest rates, Gross said.
“Pimco’s Bill Gross Says Bonds Have Seen Best Days (Update2)”
Thanks once again, Stopped-clock Bill.
My interpretation of the Gross remarks:
- PimpCo makes money be purchasing bonds on the cheap and selling them dear.
- Telling people the bond market sky is falling is one way to convince them to sell to PimpCo on the cheap.
- The Fed appears to be successfully staying on the tightrope which is suspended between the frozen hell of deflation and the fiery hell of hyperinflation; doing so requires keeping interest rates low and money tight, which are both helpful to those holding on to bond portfolios.
Paramount condo faces $216M foreclosure
South Florida Business Journal - 3-25-10
The Paramount on the Bay Condominium could be seized by its lender in a $216 million foreclosure that would rank as one of the most massive in South Florida.
The 346-unit, 47-story tower at 2066 N. Bayshore Drive in Miami is nearly completed. With the developer planning to turn the project over to the lender by not opposing the lawsuit, Paramount’s future will rest in the hands of New York-based iStar Financial (NYSE: SFI).
The lender’s affiliate, iStar Tara, filed a foreclosure lawsuit on March 19 against Paramount developer Royal Palm Miami Holding and Daniel Kodsi, the principal and CEO of Boca Raton-based RPC Holdings, according to Miami-Dade County Circuit Court records.
“We are working in an effort t turn it over to them,” Kodsi said. “Our goal is to protect the integrity of the building and work with our lender.”
Kodsi’s company is in the process of giving back several other development properties in Miami amid foreclosure complaints.
Are You Ready to Come Out of the Real Estate Closet?
by J.D. Rosendahl
The real estate market has rolled over hard thereby pushing many people into being upside down on their primary residence and/or rentals and vacation homes. I noticed several months ago that people started being more open about their issues with their real estate holdings, but I’ve also noticed many are not admitting to their problems. Are you ready to come out of the real estate closet?
Luke Mullins of the US News & World Report published: America’s Most Underwater Housing Markets on March 19, 2010. The top five markets in the worst condition are as follows:
Location
Estimated in the 4th quarter of 2009
Las Vegas, NV
81% are upside down.
Merced, CA
64% are upside down.
Phoenix, AZ
62% are upside down.
Orlando, FL
58% are upside down.
Greeley, CO
41% are upside down.
A reader has emailed the following simple question:
Any personal thoughts on walking away from a condo underwater?
The above question is one I’m getting more and more these days. The above question is essentially 2 questions in one. There’s the investment decision. And there’s the legal question. The later is the first question that needs to be addressed, “absolutely first”. I’ve seen too many people act first and ask questions later and it’s not always that easy.
So, go see an attorney first, “ALWAYS”. What you need to know from your attorney is the following:
SEEING THE ATTORNEY: What are the laws and regulations in your state that could impact you? There might be language in your loan documents you need to know.
There are issues as it relates to purchaser money loans and refinance loans, and whether or not those banks have recourse to you for any deficiency when the bank finally sells the home. AND, some financial institutions are becoming far more aggressive in seeking judgments on deficiencies, especially on higher income home owners. There might be other issues you need to know I have not covered. If you’re going to do a short sale, you want your attorney to review those documents before you sign them.
I highly recommend you take your loan documents, your tax returns for a couple years, and your personal financial statement with you to your attorney. This data might help your attorney assess risks and implications for you.
INVESTMENT DECISION: Assuming the attorney is comfortable with your situation, and the risks are minimal, here are my thoughts on the investment side of the question. I still see real state as over priced.
I expect wage deflation to continue for a number of years, which will put downward pressure on real estate affordability, and thus should compress real estate values. If we get either higher state or federal taxes, or both, that will decrease net incomes, which also puts downward pressure on real estate affordability, and thus pressure on real estate values.
In a declining real estate market, the 3 real estate categories that usually go down the furthest are land, vacation homes, and condos. I can’t foresee a condo that is upside down in any significant manner resolving itself via higher values at any time in the next several years. Many condos fore the most part are really a multifamily or apartment type unit. Thus, we should expect in a declining market that condos will re-price lower based off some reasonable multiple of its potential annual gross income. That number for most of America is still “significantly” lower, except for some of the most devastated areas.
If one executes the decision to walk away or short sale, then one should review when the ideal time is, and this too might be part of the strategy your attorney helps you with.
I know too many people who jump into this process with out talking to an attorney or strategizing a plan to optimize the situation.
I have noticed a great deal of people doing one of two things: They either let the payment go anticipating the foreclosure process and eventually getting kicked out by the bank. This process can take 12-18 months, and many are choosing not to make a payment and saving the money and living mortgage payment free including taxes and insurance during that time frame. On rental properties, many are not making payments while collecting rent the entire time and saving that money. Again, issues to discuss with your attorney.
The issue of walking away from a home via a short sale or foreclosure is a trend that has “many years” left to go, and I expect it to gain in acceptance and maybe become the norm as many lose their emotional attachment to their real estate, while opting for lower housing costs. Whether someone is forced into it by layoffs, or by a desire to not be maxed out in mortgage payments, everyone will realize the importance of cash flow. Net cash flow is really important to the personal balance sheet in the ability to save money and live within one’s means.
START BY SEEING AN ATTORNEY FIRST!!!
Frustrating Quarter Again For Short-Sellers as Nothing Goes Down
CNBC ~ March 25, 2010
Short sellers, who make their money betting against stocks, commodities and whole markets, came into 2010 with an optimistic outlook. The broad-based bull market was getting tired as it approached the one-year anniversary. The Federal Reserve was starting to signal the end to its unprecedented monetary stimulus. And credit problems were beginning to brew in Europe. But they’ll just have to wait for another quarter.
A broad based rally has continued in the first quarter of 2010 with just 45 members of the S&P 500 down more than 5 percent, a minimum decline that would even make it worth the short-seller’s cost of transaction.
Chipmaker Qualcomm (NASDAQ: qcom), previously one of the 10 worst performers in the index year-to-date, exploded higher today after raising its forecast for the year. Lululemon (NASDAQ: LULU), the yoga-wear retailer that was one of the more successful shorts of 2008, surged more than 11 percent today after also boosting its outlook.
Perpetual money machine Plan A:
1) Take the long side of short trades.
2) Use the proceeds plus help from on high to make sure that closely watched stock market pots never boil over.
This is a guaranteed money tree, folks!
Serious mortgage delinquencies jump in Q4 ~ March 25, 2010
NEW YORK (Reuters) - Serious delinquencies among U.S. mortgages jumped in the fourth quarter from the previous quarter, led by a sharp increase in serious delinquencies by the most creditworthy borrowers, U.S. banking regulators said on Thursday.
The report by the Office of the Comptroller of the Currency and the Office of Thrift Supervision, which are part of the Treasury Department, said the percentage of current and performing mortgages fell to 86.4 percent at the end of the fourth quarter of 2009, marking a seventh consecutive quarterly decline.
The drop in current and performing mortgages was attributed to an increase of 21.1 percent in mortgages 90 days or more past due to 4.7 percent of all mortgages in the portfolio at the end of 2009.
The increase in seriously delinquent mortgages was most pronounced among prime borrowers, with an increase of 16.5 percent in seriously delinquent mortgages during the fourth quarter.
The report defined “serious delinquencies” as those loans 60 days or more past due and loans to delinquent bankrupt borrowers.
Prime mortgages are granted to the most creditworthy borrowers, a sector that had initially raised few worries when the housing bubble burst as problems surfaced with the subprime mortgages offered to the riskiest borrowers.
The ongoing decline in performance of prime mortgages is a significant trend, given that those mortgages accounted for 68 percent of all mortgages within the portfolio.
“…led by a sharp increase in serious delinquencies by the most creditworthy borrowers…”
Camel’s back meet straw?
I talked to a commercial RE fellow yesterday, who is with CB Richard Ellis, what he sees ain’t pretty. Say’s there is a ton of “pent up” RE set to come tumbling down.
The dike has more leaks than fingers!
Are dikes typically strong enough to stop tsunamis?
“…led by a sharp increase in serious delinquencies by those who formerly were believed to be the most creditworthy borrowers,…”
Interesting tapes of Aldous Huxley Interviews (Brave New World Author) with Mike Wallace (3parts 1/2 hour total). Interviews done on May 18 1958 over
50 years ago . Hint: You will find his predictions and warnings amazing ,especially taken in light of when they were done .
Either find the 3 part interviews on Freeviewdocumentaries.com
or
http;//believeorcredo.wordpress.com/2009/12/19/aldous-huxley-interviewed-by-mike-wallace-3-parts-2/
To start with, I don’t see the evidence we are headed towards a one-world-dictatorship. An oligopolistic oligarchy? Absolutely!
Latest Farmers Branch Rental Ordinance Struck Down
DFW ~ Texas ~ Mar 25, 2010
A federal judge has ruled that a Farmers Branch ordinance banning illegal immigrants from renting apartments is unconstitutional.
U.S. District Judge Jane J. Boyle of Dallas ruled Wednesday that the ordinance was an attempt to enforce U.S. immigration laws, something only the federal government can do.
“Ordinance 2952 is a regulation of immigration and is preempted by the Supremacy Clause of the United States Constitution because the authority to regulate immigration is exclusively a federal power,” she wrote.
The ordinance established a licensing system for renters in Farmers Branch. Renters would be required to pay a $5 fee and obtain a residential occupancy license issued by the city’s building inspector. Under the system, the building inspector would verify a renter’s immigration status with federal officials if the renter did not declare him or herself a citizen or national of the United States. The city would revoke the licenses of people the federal government said were in the country illegally.
Boyle said in her ruling that the measure uses federal immigration classifications in ways that aren’t authorized or contemplated by federal law.
“As a result, the ordinance creates and additional restriction on alien residence in the city,” she wrote.
We really are moving into Animal Farm territory aren’t we?
Stocks erase advance after doubt emerges about prospects for Greece bailout ~ March 25, 2010
NEW YORK (AP) — Renewed concern about Greece’s debt problems short circuited the big stock market rally.
The Dow Jones industrial average closed Thursday with a gain of just 5 points after earlier rising to a new high for 2010. Broader indexes slipped.
The market’s advance fizzled after European Central Bank’s president Jean-Claude Trichet told French television that Europe must take responsibility for its financial problems. That raised concerns about when a rescue for Greece might come.
Officials from European nations were meeting late Thursday to discuss their economic problems.
Investors have been concerned for months that problems in Greece and other debt-strapped countries in Europe would spread and spoil a global economic rebound.
“Any time we see comments about it it seems to spook the market,” said Adam Gould, senior portfolio manager at Direxion Funds in New York, referring to Greece’s financial problems. He said traders still expect Greece will get a bailout but the questions about how unnerved investors. “It’s more the uncertainty.”
Bushnell Regency files Chapter 11 HartfordBusiness.Com
Bushnell Regency, the company that owns a majority of the condo units in downtown Hartford’s Bushnell on the Park, filed for Chapter 11 bankruptcy today, more than a year after it ceased payments on the property.
Typically, a company files for Chapter 11 bankruptcy to shield itself from creditors while it works out a court-approved reorganization plan.
Bushnell Regency owns 129 condominium units within the 180-unit complex at 100 Wells St., which it uses for rental apartments and office space.
The company has $8.8 million in assets, and $10.7 million in liabilities, court documents show.
Thomas Farrell, a lawyer representing Bushnell Regency, declined to comment on the case.
Bushnell Regency has been facing a host of legal problems over the last year. It started in April, when the company’s property sank into foreclosure, after it failed to make mortgage payments since November 2008.
Bushnell Regency had until today to pay Wells Fargo Co. $9.8 million in order to reclaim the property, or they risked losing control of it.
Additionally, earlier this month, nearly a dozen condo owners, whose properties aren’t part of the foreclosure, filed suit against Bushnell Regency, alleging they have violated state condo laws.
The suit alleges that the principals of Bushnell Regency, including Michael Jaffe, have repeatedly refused to provide financial records to association members, and failed to collect dues or make necessary repairs to the building.
The individual condo owners want a receiver to take temporary control of the association so they can get a true assessment of its financial health, the complaint said.
Russian oil major pulls out of Iran ~ Vladimir Radyuhin
The Hindu ~ 3-25-10
Russia’s largest private oil major said it was suspending an oil project in Iran because of U.S. pressure.
The LUKoil company issued a statement on Wednesday saying it had stopped further work on the Anaran project “because of the economic sanctions imposed by the U.S. government.” It blamed the sanctions for a loss of some $63 million last year and said it feared more losses if it continued to carry on the project.
The Anaran field, with estimated oil reserves of 2 billion barrels, was operated by a consortium of Norwegian StatoilHydro (75 per cent) and LUKoil Overseas (25 per cent). LUKoil Overseas head Stanislav Kuzyev has clarified that his company retains its rights in the project and would be ready to return “under more favourable economic situation.”
LUKoil has 1,600 petrol filling stations in the U.S. and last year announced plans to build an oil refinery in the U.S. These investments would be vulnerable to tough sanctions the U.S. imposed on international energy companies operating in Iran.
Keep pumping baby…
Govt. says US oil production increased in 2009
CHEYENNE, Wyo. — Increased crude oil production in the Gulf of Mexico and North Dakota more than offset declines elsewhere last year to result in the first annual increase in U.S. oil production since 1991, according to the U.S. Energy Information Administration.
Domestic oil production in 2009 averaged 5.32 million barrels a day, up 7.4 percent from 4.95 million barrels a day in 2008, according to the federal agency’s Short-Term Energy Outlook report for March.
Last year saw the highest level of domestic oil production since 2004, when the daily average was 5.42 million barrels. Production had been declining steadily since 1991’s daily average of 7.42 million barrels.
The report forecasts production to continue growing for at least the next couple years, with increases of 3.9 percent predicted in 2010 and 0.3 percent in 2011.
Last year’s increase resulted mainly from drilling investments made by energy companies before prices collapsed in 2008, said Tancred Lidderdale, an analyst in the Energy Information Administration, part of the U.S. Department of Energy.
“Last year’s increase resulted mainly from drilling investments made by energy companies before prices collapsed in 2008″
Yep, they sorely miss makin’ EVERYONE in AMERICA pay $4.60 per gallon EVERYDAY…you think?
http://www.syracuse.com/news/index.ssf/2010/03/wall_street_bank_ceo_will_be_s.html
Jamie Dimon, Syracuse University’s 2010 Commencement Speaker
Here’s a boondoggle in my neck of the woods:
http://mchenrycountyblog.com/category/riverside-square/
It’s a half finished condo building in Algonquin, IL. It’s not looking too good after sitting open through two Chicago winters. The village board just voted to force Amcore bank to demolish the structure.
I HATE, HATE, HATE that pseudo European style! It’s everywhere in Houston! And it looks about as classy as gilded crap.
Especially with the Tyvek exterior. They finally put in the windows last fall, and now they’re going to tear the whole thing down. They never did finish the roof. What a waste!
I picked the wrong presidency during which to lose my job, as we had a mortgage when that occurred during the aftermath of the early 1990s recession. I don’t remember Team Clinton forcing our lender to provide any mortgage payment reduction.
I hope Ben or someone else who knows more than I do about contract law can offer comment on whether it is legal for event the POTUS to force lenders to reduce mortgage payments on a discriminatory basis (e.g., those who lost their jobs get payment reductions; the rest of you debt slaves have to work harder than before if you want to keep your homes).
Obama administration to order lenders to cut mortgage payments for jobless
By Renae Merle and Dina Elboghdady
Washington Post Staff Writers
Thursday, March 25, 2010; 6:01 PM
The Obama administration plans to overhaul how it’s tackling the foreclosure crisis, in part by requiring lenders to temporarily slash or eliminate monthly mortgage payments for many borrowers who are unemployed, senior officials said Thursday.
Banks and other lenders would have to reduce the payments to no more than 31 percent of a borrower’s income, which would typically be their unemployment insurance, for up to six months. In some cases, administration officials said, a lender could allow a borrower to make no payments at all.
The new push, which the White House is scheduled to announce Friday, takes direct aim at the major cause of the current wave of foreclosures: the spike in unemployment. While the initial mortgage crisis that erupted three years ago resulted from millions of risky home loans that went bad, more recent defaults reflect the country’s economic downturn and the inability of jobless borrowers to keep paying.
…
“… even the POTUS …”
“…as we had a mortgage when that occurred during the aftermath of the early 1990s recession.”
I can’t remember Mr. Bear,…is that the same year Lehman Bros was started as an IPO?
Under the Lehman family (1850–1969)
Emanuel and Mayer Lehman
In 1844, 23-year-old Henry Lehman,[10] the son of a cattle merchant, emigrated to the United States from Rimpar, Bavaria. He settled in Montgomery, Alabama, where he opened a dry-goods store, “H. Lehman”. In 1847, following the arrival of his brother Emanuel Lehman, the firm became “H. Lehman and Bro.”With the arrival of their youngest brother, Mayer Lehman, in 1850, the firm changed its name again and “Lehman Brothers” was founded.
During the 1850s, cotton was one of the most important crops in the United States. Capitalizing on cotton’s high market value, the three brothers began to routinely accept raw cotton from customers as payment for merchandise, eventually beginning a second business trading in cotton. Within a few years this business grew to become the most significant part of their operation. Following Henry’s death from yellow fever in 1855, the remaining brothers continued to focus on their commodities-trading/brokerage operations.
“the inability of jobless borrowers to keep paying.”
Why would the jobless borrower want to give up 31 percent of their unemployment check? How would the jobless borrower pay their credit card? How could the jobless borrower make the car payment? I think they are asking a little too much from the jobless borrower. I think they should give the jobless borrower a T.V. show. They could call it, The Jobless Borrower. Then he wouldn`t be jobless.
That`s it. I am going out and buy a house and not pay a single mortgage payment.
Won’t you have to lose your job first to qualify for payment reductions?
I will fire myself.
Oh, look in the mirror and say:
“Are you talkin’ to me”?
“Are you talkin’ to meeee”?
“Are yooouuuu talkin’ to me”?
LOL, jeff and HWY.
Seems like an MBS would be a fantastic investment now that the POTUS can order you not to collect from folks that owe you. (Sarcasm off)
Seems like they are trying to ensure that private sources of mortgage lending are dead in the water forever. Who wants to be on the lending side of a mortgage if the POTUS might summarily write down the value of your investment on a whim and a media sound bite?
More Extend & Pretend Keep Hope Alive bs.
Keep this sort of bs coming and the mortgage payments will keep flowing into the banks.
Kill the hope and thousands of FBs will walk.
More Extend & Pretend
Yep, it dove-tails well with this previous Deceive & Believe policy:
We’ll EXTEND you a home loan, then we’ll both PRETEND that is a TRUE valuation, OK?
..whether it is legal for event the POTUS to force lenders to reduce mortgage payments..
He can’t.. He can only enforce existing law, but Congress can change the laws at will.
In the matter of our troubled but TBTF economy, government has barely begun to implement all the tools and methods at their disposal.
Wow - just wow.
Apparently the goal is to achieve full 100% unemployment - so I’m not sure why they don’t just make working illegal, and get it over with.
Can you say “black market economy”?
GOP = “TruePurity™” + GOP “do-our-dirty work” = “TrueAnger™” PeeParty tea toadlers:
Filed: “Shadow Cheney told you: Stay-on-Message!”
BWAHAHAHicHAHAHicHAHAHAHAHicHAHAHic* (DennisN™)
March 25, 2010 by Brian Montopoli
GOP Commentator David Frum Loses Job After Criticizing Party:
“I do regret this abrupt and unexpected conclusion of our relationship.”
In the Waterloo post, Frum, a former speechwriter for President George W. Bush, wrote that the GOP and conservatives “suffered their most crushing legislative defeat since the 1960s.”
“A huge part of the blame for today’s disaster attaches to conservatives and Republicans ourselves,” he wrote. “At the beginning of this process we made a strategic decision: unlike, say, Democrats in 2001 when President Bush proposed his first tax cut, we would make no deal with the administration. No negotiations, no compromise, nothing.”
David Frum, who wrote a widely-circulated blog post Sunday suggesting passage of the health care bill amounted to “Waterloo” for the Republican Party, has apparently been forced out of his fellowship at the conservative American Enterprise Institute.
…health care bill amounted to “Waterloo” for the Republican Party..
From a wider, non-partisan point of view, it looks more like the Waterloo for the Constitutional Republic..
From a wider, non-partisan point of view, it looks more like…lol
Yep, 2010…The GOP is one big happy family of “Ordinary People”
It’s good that people can still find something funny about it.
GOP.. DNC.. Blah Blah Blah.. We’ve finally put ourselves in a situation where, before long, no one will doubt that it is “Us verses Them”.. as it has been all along.
Them? Who is Them? Who is us? Who is “we”?
If you have to ask, you wouldn’t understand the answer.
This is the biggest problem with the GOP
The leadership tolerates absolutely no disent or critical analysis. Moderates are forced out of the party. Our gov could save a lot of money and fire all of the GOP congressmen and then give 1 GOP senator 40+ votes. That senator could run in every state, and his vote would be the total of states he won.
You’re either with us…or against us. I honestly feel this attitude is the biggest threat to this country.
(Hwy wonders if Senators Collins & Snowe exchange private jokes with Shelby’s Corker McConnell about the Non-Hawaiian and his current myopic goal to destroy AMERICA)
ZIRP + overvalued assets + price supports + restoration of lending standards = tight money
Bernanke: Record-low rates needed to aid economy
By JEANNINE AVERSA (AP) – 3 hours ago
WASHINGTON — Record-low interest rates are still needed to rev up the economic recovery, Federal Reserve Chairman Ben Bernanke told Congress on Thursday.
Bernanke, in testimony to the House Financial Services Committee, essentially repeated the rationale behind the Fed’s decision last week to hold rates near zero. He cited still-fragile economic conditions, and noted that inflation is low, which gives the Fed leeway to keep rates at rock-bottom levels.
The Fed chief didn’t offer new clues about when the central bank might reverse course and start tightening credit. He said that would need to happen when the “expansion matures.” Some investors and analysts think higher rates could come in the fall.
Deciding when to tighten credit is the biggest challenge facing Bernanke, whose second term started in February. Moving too soon could short-circuit the recovery. Waiting too long could unleash inflation and sow the seeds for new speculative bubbles in stocks or commodities or other assets.
One of the reasons the Fed is holding rates so low is because of stubbornly high unemployment, Bernanke said. It’s now at 9.7 percent, a potential restraining force on the economy’s rebound.
Bernanke said the Fed “will not be able to wait until things are completely back to normal” before it starts to boost rates. But the Fed wants to make sure that the economy is on a sustainable growth path and that jobs are being created, he said.
The Fed also wants to see more lending by banks before it starts tightening credit, Bernanke said.
“The key point … is that the Fed is no closer to implementing its exit strategy,” said Paul Dales, an economist at Capital Economics. Bernanke’s remarks suggest “he is in no hurry” to raise rates, Dales said.
On Wall Street, the Dow Jones industrial average, which had rose as much as 119 points earlier in the session, pared gains late in the day on renewed concerns about Greece’s debt problems. The Dow closed up 5.06 points.
The Fed kept a pledge last week to hold rates at record lows for an “extended period,” a decision that drew one dissent.
…
“ZIRP + overvalued assets + price supports + restoration of lending standards = tight money”
In the “Long-Term” what is the significance of a “leap year” …minutes/hours/days?
Oh, I forgot..how often do leap years occur?…
Four score & 3 leap years ago… “affordability” returned to America.
BWAHAHAHAHAHAHAHAHAHAHAHA!!!!!
Shelby’s Corker McConnell: You all should give ‘em an Alabama/Tennessee/Kentucky welcome basket complete with some Southern State “tax rebates” & free land & “hard” workers @ $7.50 per hour & medical care at the drag-in-clinic…
How much $$$$$$ are Land Rovers & Jaguar’s going for these days?
Car fire raises safety concerns for Tata Motors:
“New Tata Motors car bursts into flames, raising safety questions for ultra-cheap Nano
Software engineer Satish Sawant, his wife and 5-year-old son escaped from the silver Tata Nano before the tiny car was engulfed by fire.
“…Tata has offered Sawant a replacement Nano or a refund.
“My wife now doesn’t want to buy any car,” Sawant said by phone from his home in northern Mumbai on Thursday. “She doesn’t even want to go for a Mercedes.”
Tata Motors, which also owns Jaguar and Land Rover, plans to start selling versions of the Nano in Europe in 2011, and later in the U.S.
He said the company recently made a step in the right direction, hiring Carl-Peter Forster, former head of General Motors in Europe, as group chief executive.
Erika Kinetz, AP Business Writer, On Thursday March 25, 2010
‘Hardship letter’ key to loan modification
By Kimberly Miller
Palm Beach Post Staff Writer
Posted: 9:03 p.m. Thursday, March 25, 2010
Banks aren’t big fans of ultimatums, especially when they’re being asked for a favor.
But Robert Quesada, over his head in debt and underwater in his mortgages, said his first letter requesting a reduction in his monthly home payments may have come off a little like a challenge.
“You are just so overwhelmed with your situation, you say, ‘I’m willing to do this under these terms or you can just keep the house,’ ” said Quesada, a Fort Lauderdale dentist who cut his own salary by half last year so he wouldn’t have to lay off employees.
More than 1 million Americans have applied for a home loan modification through the federal Making Home Affordable program, meaning they also have been asked to write a “hardship letter” — a statement explaining their fiscal, familial, and, sometimes, physical condition.
But weaving a persuasive tale of financial woe that quickly communicates the facts while eliciting a certain amount of sympathy is no easy task.
And even those versed in writing such correspondence differ on the characteristics of a successful letter, including length, tact and whether it should be handwritten or typed.
Quesada sought help from the LaBovick & LaBovick law firm in Palm Beach Gardens where his letter was refashioned so it got to the point quicker, and included what Quesada was doing to help himself out of his financial predicament. The letter portrayed him as wanting to partner with the bank, instead of be its adversary.
“People don’t think about that because they just want to tell their story,” said Paul Baltrun, director of loss mitigation for LaBovick & LaBovick.
Baltrun suggests making the letter about one page, and including specific dates of events that led to the hardship, such as loss of a job, or illness.
But don’t give too much information about medical conditions, cautioned Jonathon Ende, CEO of FreeHampReport.com, an online guide to filling out loan modification applications.
“They don’t want to hear about your bathroom habits,” said Ende, who has edited such information out of client letters. “Don’t be too vague or too technical.”
Ende also recommends typing the letter. After being faxed several times, handwritten prose may be unreadable.
That’s where he differs with Attorney Michael J Posner of the Ward Damon law firm in West Palm Beach.
Posner said a handwritten letter is better in some situations because it lends a more personal touch.
“You are dealing with human beings, hopefully,” said Posner, who believes letters can be up to three pages long. “The more detail the better.”
One bank spokesman, who didn’t want to be identified, said sob stories aren’t as effective as just stating the bottom line. Bank employees don’t have time to read through soap opera-style tales.
Nancy Norris, spokeswoman for Chase, said sticking to the facts is best.
“Writing the letter seems to be very difficult for people,” she said. “It’s a very emotional topic and can mean rehashing some bad parts of their lives.”
One thing everyone seems to agree on is not to insult or chastise the bank.
Posner said he’s had clients whose original hardship letters contained statements about how “banks are evil” and because they received taxpayer bailouts they should give borrowers a break also.
“That’s just going to make the banks mad,” agreed Melissa Ocasio, an attorney with Ommert, Murray and Associates in West Palm Beach. “You want the banks on your side.”
Jeni McGowan has written four hardship letters in her more than yearlong attempt to get a modification for her Acreage home.
She’s chronicled her husband’s fight with renal cell carcinoma and the removal of his kidney. She’s written about the couple’s bankruptcy and her property’s plummeting value.
Earlier this year, McGowan learned her request was granted. But she’s not especially pleased with her savings — $154 each month.
“Did it help?” she said about her letters. “I don’t know if anything helped.”
what would a bank most want to hear.. How about:
We’ve made a careful assessment of our spending, cut out all non-essentials, and figure we can continue to pay the mortgage if monthly payments were reduced by $278.05.
Half of U.S. Home Loan Modifications Default Again:
March 25, 2010 By John Gittelsohn
“…The median price of a U.S. home was $165,100 in February, down 28 percent from its peak in July 2006,”
In California the median is measured thus:
House in Fresno price @ $60,000
House in Encinitas price @ 675,000
Therefore, the CA median price: $590,000
Well something like that… kinda, sorta, depends on whose giving you the data