The Housing Bubble

Where is everybody?

“Millions of unemployed may never recover

Despite recent job gains, one grim statistic casts a long shadow over the recovering economy and the futures of more than 6 million workers: Fully 44 percent of the nation’s 15 million unemployed have been out of work for more than six months.”

http://seattletimes.nwsource.com/html/nationworld/2011585797_jobs12.html

“As in previous downturns, a large share of long-term unemployed are in manufacturing and construction.

But most workers who have been jobless for 27 weeks or more are in sales, office and other service-industry jobs, including more than 1 million in management and professional occupations.”

Tech takes a pass on this recession?

“In one prominent study, Columbia University economist Till von Wachter examined the pay history of workers who lost their jobs during the early 1980s recession. Using Social Security earnings records, von Wachter and co-researchers found that these previously stable workers sustained a 20 percent drop in earnings after 10 years of losing their jobs, compared with other workers who weren’t let go during that period.

For the laid-off group, the income losses didn’t fade away completely even 20 years later.”

I wonder how many of them were happy to have a job and afraid to ask for a raise. How much was due to external forces versus internal forces?

Seems kind of silly to me. Do we really need a law for this? Aren’t there other things for which we really need laws?

“Senator vows to stop airline’s carry-on fee”

http://seattletimes.nwsource.com/html/travel/2011585968_webcarryonfee11.html

If I am charged as much to carry on as to check, I’ll start checking again. And if it gets too expensive, I won’t fly as much. It is already becoming a real hassle. Is this fee-for-everything a sign of an airline industry death spiral?

sleeping?

Wow! A 9 year old high rise with structural problems.

http://seattletimes.nwsource.com/html/localnews/2011585964_apartments12m.html

“Carpenter’s Tower — owned by Carpenters Union, Local 131 and the Multi-Employer Property Trust — said the problems can be traced to construction. In its news release, the company said load-bearing cable ends have corroded because they weren’t painted properly, and that builders also used the wrong type of grout, which allowed water to seep in.

Carpenter’s Tower sued the contractor, Bellevue’s McCarthy Building Companies, and the Seattle-based Hewitt Architects, in 2007, alleging negligence and failure to adhere to industry standards. McCarthy, a subsidiary of a Missouri company, in turn sued dozens of subcontractors. The court file contains thousands of pages of documents, and is scheduled for trial in September in King County Superior Court.”

We wrote offers on two houses. One that was asking $250k closed at $247k. Madness.

Present and accounted for, sir.

http://www.huffingtonpost.com/simon-johnson/greece-saved-for-now-is-p_b_533533.html

Crisis in Greece “contained” for perhaps a few more weeks or months. The MSM will tout this as “recovery” and urge more debt-fueled consumerism on behalf of their corporate pimps.

Only the trouble just keeps percolating up from the PIIGS. Now attention is turning to Portugal. Since the EU just rewarded political and fiscal irresponsibility, lets see how long it takes for new rumblings of default to shake the EU.

Which works better in spotting bubbles and predicting their imminent collapse:

- Reputation-based models (e.g. Federal Reserve Board)

- Wisdom of Crowds models (e.g. The Housing Bubble Blog)

I have my hunch; what’s yours?

http://blogs.telegraph.co.uk/finance/rowenamason/100004839/iceland-has-its-truth-report-into-the-financial-crisis-%E2%80%93-now-what-about-one-for-the-uk/

Icelanders are demanding and getting honest answers about the systemic and individual failures and crimes that led to their economic meltdown. The American sheeple, on the other hand, are content with the stage-managed whitewash where banksters face their bought-and-paid-for political puppets and pretend to be contrite, while knowing they face zero accountability or consequences.

Forbes changes its mind about Denver housing market
Denver Business Journal

Forbes.com — which only 10 months ago dubbed Denver as America’s best city to buy a home — now declares the Mile High City the second-worst housing market in America.

“Denver doesn’t come to mind as a housing-crisis hot spot, but the city that once looked like it would escape the housing bust unscathed now shows signs of strain,” Forbes said in its report. “More than 42,000 homes are on the market in the [Denver] metro, 27 percent more than last year.”

Forbes said it evaluated U.S. metro areas with more than 1 million people, ranking them on increase in home inventory as well as changes in single-family home sales, up or down, between the fourth quarters of 2008 and 2009.

Milwaukee ranked as the worst U.S. housing market in Forbes’ report, followed by Denver, Los Angeles and St. Louis in a tie for third, and San Francisco.

http://www.nypost.com/p/news/business/metal_are_in_the_pits_2arTlGNbMK7mb1uJeVHb0O#ixzz0kr6yf6PR

A 40-year trader in the metals pits has gone public with charges that JP Morgan has been colluding with the Fed in a massive fraud to suppress and manipulate the price of precious metals. The NY Post is the first and so far only major newspaper to break this potentially huge story - the usual MSM journalistic omerta applies for the usual shills, since if true, this would constitute the largest financial fraud in US history, and could spell doom for the U.S. dollar.

What this guy says about the low end bottoming out before the high end makes no sense, but it is still entertaining. In particular, you cannot have a bottoming of the bottom of the market ahead of a future collapse of the top end. It is sort of like saying that your home’s floor is stable even though the roof is about to cave in on the house.

Further, the idea that we are one year away from recovery has already been out there for a few years now. But in fairness, the article does say “he believes,” and we all know how accurately the faith-based predictions of economists have recently turned out. A better guess might be obtained by comparing the end of the last serious recession (March 1991) to the subsequent housing trough (1996? 5 years later). Since this time the bubble was the biggest in history, 5 years after the end of the recession might prove overly optimistic, and that timing would already get you out to 2014, at the least.

PIMCO: Don’t Expect A Housing Recovery Anytime Soon
Vincent Fernando, CFA | Apr. 12, 2010, 2:07 AM

PIMCO has completed an excellent Q&A with Scott Simon, the head of their mortgage and asset-backed securities team.

Mr. Simon addresses the housing outlook now that the federal reserves historic mortgage-backed security (MBS) buying program (which had been used to provide liquidity and support market prices during the crisis) has ended.

Overall, he presents a mixed outlook.

Firstly, he thinks the MBS market can hold up on its own now and doesn’t need the Fed’s buying support, and in fact hasn’t needed the Fed’s support for many months now:

PIMCO:

Simon: We are unlikely to see a significant market disruption in the Agency market stemming from the Fed’s retreat. First, the retreat had been well advertised for months before the event. Investors knew exactly when the program was going to end and how much the Fed was buying. So it’s not as if anybody woke up and was surprised by the fact that the Fed had stopped buying.

Second, private buyers are in a much better position today than they had been before the Fed started buying. The private balance sheet was seriously impaired by the financial crisis at the time the Fed stepped in with its public balance sheet. But by October 2009 or so, the private balance sheet had improved. The Fed probably could have stopped buying at that point with about $850 billion in completed purchases, but it felt compelled to reach the previously announced total of $1.25 trillion, and so the next $400 billion in MBS drove prices higher.

Yet secondly, he thinks MBS prices are looking pricey, driven up by fed buying that went on for too long, as mentioned in the excerpt above.

Q: What are your views on MBS prices today?

Simon: Agency MBS look expensive vs. 10-year Treasuries but cheaper compared to two-year swaps. We never look at mortgage bonds in isolation, but compare prices against an array of other instruments, so I avoid being too specific about labeling them as cheap or expensive. However, I’ll go so far as to say Agency MBS peaked in richness in late December or early January and finished March still priced on the richer side of fair.

Finally, and more broadly, he believes that the low-end housing market may have already bottomed, while the high-end market will bottom later this year. Thing is, he warns that “If one labels recovery as prices rising dramatically, we do not foresee that anytime soon.”
…

It occurred to me after a discussion with my friend, that 90% of the people in the USA have know idea the constitution says. I contend that 90% off the people have failed to read the constitution of the United States of America. For this reason alone we are doomed.

A word for the wise (and sorry to repeat this so often, but somebody needs to counter the serial bottom caller’s “housing market will recover by the end of this year” meme):

- Buy now and get locked in to a high-priced loan forever.

* The Wall Street Journal
* ECONOMY
* APRIL 12, 2010, 7:53 A.M. ET

Committee Reluctant to Mark End of Recession
By A WSJ Staff Reporter

The committee of academic economists that dates the beginning and end of recessions said it isn’t ready to put an end date on the recession that began in December 2007.

The National Bureau of Economic Research’s Business Cycle Dating Committee, which met Friday, said, “Although most indicators have turned up, the committee decided that the determination of the trough date on the basis of current data would be premature.”

The committee’s full statement, issued this morning from the NBER Cambridge offices, said:

“The committee reviewed the most recent data for all indicators relevant to the determination of a possible date of the trough in economic activity marking the end of the recession that began in December 2007. The trough date would identify the end of contraction and the beginning of expansion. Although most indicators have turned up, the committee decided that the determination of the trough date on the basis of current data would be premature. Many indicators are quite preliminary at this time and will be revised in coming months. The committee acts only on the basis of actual indicators and does not rely on forecasts in making its determination of the dates of peaks and troughs in economic activity. The committee did review data relating to the date of the peak, previously determined to have occurred in December 2007, marking the onset of the recent recession. The committee reaffirmed that peak date.“

How many other central banks besides the Fed find themselves pushing on proverbial strings these days?

And do those in charge of the Bank of Japan pretend to be all-powerful like certain FOMC members do?

* The Wall Street Journal
* ECONOMY
* APRIL 12, 2010, 2:09 A.M. ET

Japan Bank Lending Falls

By TAKASHI MOCHIZUKI and MIHO NAKAUCHI

TOKYO — Japanese bank lending in March fell at its sharpest pace since August 2005, a reaction to the steep increase in loans a year earlier during the financial crisis but also reflecting weak corporate demand for funds due to an uncertain economic outlook.

Lending by all banks excluding credit unions dropped 2.0% on year to ¥401.13 trillion ($4.3 trillion), the fourth straight month of declines, the Bank of Japan said Monday.

The shrinking lending comes even as the country’s central bank pushes ahead with an easy monetary policy to try to revive private demand in the world’s second largest economy. The Bank of Japan has kept its target short-term interest rate at 0.1% since December 2008, and last month it doubled the amount of low-interest loans it will lend to banks to Y20 trillion.

The BOJ’s easing isn’t explicitly aimed at increasing bank lending–with companies’ funding demand weak, monetary policy alone has little power to get banks to make more loans. But with many Japanese firms dependent on bank loans to do business, such lending would need to rise to improve business confidence among companies, especially smaller firms.
…

Shut her down, Ben. It’s all over..

You’re Awesome, America
by Daniel Gross
Slate Magazine

“The current pessimism is part of a historical economic-inferiority complex. To hear some critics tell it, things have been going south in this country since the cruel winter in Jamestown, Va., in 1609, when most of the settlers died. For most of the 19th century, America was the immature, uncouth cousin that required huge infusions of European capital to build its railroads. The United States emerged from World War II as the globe’s industrial, financial, and technological leader by default—the rest of the developed world had destroyed much of its industrial capacity. Yet Americans were insecure about their rising status. In the 1920s, many Progressives returned from Mussolini’s Italy convinced that Il Duce had a superior economic model. During the New Deal, bankers and industrialists earnestly fretted that Franklin Roosevelt would ruin the nation’s prospects for growth by establishing a new safety net. The U.S.S.R.’s launch of the Sputnik satellite in 1957 inspired fears that the Soviet Union’s presumed technological lead would allow it to triumph in the Cold War. And in the 1980s, Japan threatened the United States with exports of electronics and cars and by buying trophy properties like Rockefeller Center and the Pebble Beach golf resort. “The Cold War is over, and Japan won,” as Sen. Paul Tsongas put it in 1992.”

“Of course, the declinists were often wrong—Rockefeller Center and Pebble Beach returned to U.S. ownership within a decade. Just as exuberant projections are generally made precisely at the top (remember Dow 36,000?), prophecies of long-term decline usually gain traction after we’ve suffered a catastrophic fall. This time around, the chorus of naysayers reached its climax in March 2009, when Federal Reserve Chairman Ben Bernanke was widely mocked for his identification of “green shoots” of recovery. In the first quarter of 2009, the economy was shrinking at a 6.4 percent annual rate. By the fourth quarter it was growing at a 5.9 percent rate. Consider the scope of that swing: The growth rate of a $14.5 trillion economy shifted by 12.3 percentage points in about nine months. Like a massive sailboat pivoting 180 degrees in choppy seas, this wrenching turnaround produced a massive wake and induced nausea among many of its passengers.”

“The recovery came quickly because the public and private sectors reacted with great speed. In the 1990s, Japanese policymakers deliberated and delayed before embarking on a program that included interest-rate cuts, a huge stimulus program, expanded bank insurance, and the nationalization of failed institutions. In 2008 and 2009 it took the United States just 18 months to conduct the aggressive fiscal and monetary actions that Japan waited for 12 years to carry out. And the patient responded to the shock therapy, as the credit markets and financial sector bounced back. Since the announcements of the Treasury-imposed stress tests in May 2009, banks have raised more than $140 billion in new equity capital. In August 2009, not even the most cockeyed optimists could have projected that within four months, Bank of America, Citi, and Wells Fargo would return $100 billion in borrowed funds to the taxpayers. But they did.”

“CIT Group, the small-business lender that lost its way in an ill-timed foray into subprime, is a perfect example of those quick reflexes. It filed for Chapter 11 on Nov. 1, 2009. In five weeks it wiped out $10.4 billion in debt (including $2.3 billion of TARP funds) and emerged from bankruptcy. It has brought in a new CEO—John Thain, who had run the New York Stock Exchange and Merrill Lynch—and is now focusing on its core business of lending to small and midsize firms. “

It’s hard to reconcile the serial bottom caller’s stopped clock forecast of a housing recovery by year’s end with the evidence that the U.S. labor market is FUBAR for the foreseeable future.

* OPINION
* APRIL 12, 2010

The Jobs Picture Still Looks Bleak
Many outsourced jobs will never return, and median income will likely continue to fall just like it did during the last so-called recovery.

By ROBERT REICH

The U.S. economy added 162,000 jobs in March. That sounds impressive until you look more closely. At least a third of them were temporary government hires to take the census—better than no job but hardly worth writing home about. The 112,000 real new jobs were fewer than the 150,000 needed to keep up with the growth of the U.S. population. It’s far better than it was—we’re not hemorrhaging jobs as we did in 2008 and 2009—but the bleeding hasn’t stopped.

Since the start of the Great Recession in December 2007, the economy has shed 8.4 million jobs and failed to create another 2.7 million required by an ever-larger pool of potential workers. That leaves us more than 11 million jobs behind. (The number is worse if you include everyone working part-time who’d rather it be full-time, those working full-time at fewer hours, and people who are overqualified for the jobs they’re in.) This means even if we enjoy a vigorous recovery that produces, say, 300,000 net new jobs a month, we could be looking at five to eight years before catching up to where we were before the recession began.

Given how many Americans are unemployed or underemployed, it’s hard to see where we get sufficient demand to support a vigorous recovery. Outlays from the federal stimulus have already passed their peak, and the Federal Reserve won’t keep interest rates near zero for very long. Although consumers are beginning to come out of their holes, it will be many years before they can return to their pre-recession levels of spending. Most households rely on two wage earners, of whom at least one is now likely to be unemployed, underemployed or in danger of losing a job. And even households whose incomes have returned are likely to be residing in houses whose values haven’t—which means they can’t turn their homes into cash machines as they did before the recession.
…

Yawn…

* The Wall Street Journal
* REVIEW & OUTLOOK
* APRIL 12, 2010

Greece’s Debt Lessons
New York, California and Washington are on the same path.

European governments on Sunday moved closer to bailing out Greece, saying the country would be eligible for up to €30 billion in loans this year at about 5% interest from fellow euro nations if a rescue becomes necessary. This is one more attempt to assure credit markets in advance of a new auction of Greek debt on Tuesday, for whatever those attempts have been worth. Greece’s debt agony is painful but it might do some good if the rest of the world—including Washington—heeds its lessons.
…

Picture = bleak

MSM-favored economist = liars and prostitutes

In these dark times, when truth and reason seem nearly extinct in the face of all-pervasive dissembling and manipulation, this blog and its posters have been a real oasis. Thanks, Ben and fellow HBBers.

A note from a person who moved from Hardeeville, S.C. to Nebraska :

“Finally - after 2 years! - sold the house in Hardeeville; papers get signed today. This deal has been dragging on and on and on… my poor realtor - who is also a dear friend - has been in deep kimchee for the past two years. Three years ago she was selling $500,000 and up homes without a quiver. This year, she has done a few foreclosures and short sales, just getting by on the skin of her teeth. When selling my paltry little house for $83,900 is all she has to look forward to, in fees, well, you know that the market and the banks have gone further south than even the Deep South. All I really care about is getting out the money I put into the place - we bought it for $29,000, 20 years ago - and getting out from under the payments and insurance and taxes on the place. Kinda funny that here, taxes on the house, outbuildings, and 60 acres are $404 a year - there, on a 1975-built, 1000-sq-ft brick home with 1/3 of an acre, the taxes are almost $1,000 a year. My realtor had to fight to get this guy a loan at a bank - and he was “preapproved” last year, for a loan up to $160,000! Just glad we got out from under before the crash”.

End of Recession Not Yet Declared

WASHINGTON (AP) — A panel of academics that date the beginnings and ends of recessions isn’t ready to declare just yet when this downturn ended.

The National Bureau of Economic Research says although most barometers show improvements in the economy, it would be “premature” to pinpoint the end of a recession based on economic data seen so far.

The group has already pinpointed the start date of the recession as December 2007. Many private economists believed the recession ended in June or July last year.

(In other words, it ain’t over ’til NBER says it’s over.)

GAO: Postal Service business ‘not viable’

The U.S. Postal Service’s current business model “is not viable” and the mail agency should make deeper job and wage cuts, hire more part-time staff and consider outsourcing operations, according to a draft of a government audit acquired by The Federal Eye.

Auditors also urge Congress to remove restrictions on the Postal Service’s ability to cut Saturday mail delivery and close post offices, according to the report, which offers recommendations similar to the USPS’s own proposed 10-year business plan.

Lawmakers requested the Government Accountability Office report, set for a Monday release, as they prepare to consider the USPS plan, which was introduced last month. The proposals call for an end to six-day delivery and ask Congress to give the mail agency the ability to raise prices beyond the rate of inflation and close post offices if necessary.

The report’s conclusions pleased top postal officials who are gathered this week in Nashville for the annual National Postal Forum, a convention for the mail agency’s largest customers.

Postmaster General John E. Potter said Sunday he was pleased with the GAO’s general conclusions, but concerned with suggestions in the report that further study of the issue is required.

“We’ve studied this significantly, the time for study is over, now’s the time for action,” he said.

Potter and his colleagues estimate the Postal Service will lose a record $7 billion in the fiscal year that ends in September and could lose at least $238 billion in the next decade if Congress fails to act.

Auditors appeared to push beyond the USPS proposal. “If no action is taken, risks of larger USPS losses, rate increases and taxpayer subsides will increase,” GAO said.

Ron Paul chastises at GOP conference: Conservatives ‘like the empire’
April 10th, 2010

He was met with both disapproval and applause during the Southern Republican Leadership Conference for describing conservatives as hypocritical when they call for a return to Constitutional values while supporting foreign wars.

The conservatives and the liberals, they both like to spend. Conservatives spend money on different things. They like embassies, and they like occupation. They like the empire. They like to be in 135 countries and 700 bases.

Don’t you think it’s rather conservative to say, ‘Oh it’s good to follow the Constitution. Oh, except for war. Let the President go to war anytime they want.’ We can do better with peace than with war.

While most of the other speakers at the event used plenty of rhetoric for “easy applause,” as Washington Post reporter David Weigel put it, Paul stuck to the outrage over American foreign policy that has defined his platform.
Story continues below…

Whenever the boos grew loud enough, Paul returned to his “humble” foreign policy stance.

“It’s been 60 years since we went to war in Korea,” said Paul. “Why do we have to have troops there?”

Klamath Falls may try 4-day school week to save money

Klamath County School officials are considering cutting the school week to four days in an effort that would save the district $6.3 million.

By The Associated Press

KLAMATH FALLS, Ore. — Klamath County School officials are considering cutting the school week to four days to save the district $6.3 million annually.

The Herald and News reported that the shortened week is one of many money-saving measures school officials are considering.

District Superintendent Greg Thede says that a $5.8 million cut to his $60 million budget and nearly 20 layoffs last year prompted the district to form a committee to study the option of cutting Fridays from the school week.

He says that school days Monday through Thursday would be longer to meet state hourly requirements.

“I think we’ve seen all over the state, programs getting cut, class sizes going up, employee groups having to make concessions,” Thede said. “These times we’re going through right now are unprecedented. It’s tough.”

But there are concerns from the Klamath Falls Association of Classified Employees, the union that represents classified staff, such as teaching assistants, cooks, custodians, secretaries and bus drivers.

Union President Linda Braden says one less day in the week will mean a day less of work for 380 classified staff.

Interest Rates Have Nowhere to Go but Up ~ NY Times

Even as prospects for the American economy brighten, consumers are about to face a new financial burden: a sustained period of rising interest rates.

That, economists say, is the inevitable outcome of the nation’s ballooning debt and the renewed prospect of inflation as the economy recovers from the depths of the recent recession.

The shift is sure to come as a shock to consumers whose spending habits were shaped by a historic 30-year decline in the cost of borrowing.

“Americans have assumed the roller coaster goes one way,” said Bill Gross, whose investment firm, Pimco, has taken part in a broad sell-off of government debt, which has pushed up interest rates. “It’s been a great thrill as rates descended, but now we face an extended climb.”

The impact of higher rates is likely to be felt first in the housing market, which has only recently begun to rebound from a deep slump. The rate for a 30-year fixed rate mortgage has risen half a point since December, hitting 5.31 last week, the highest level since last summer.

Along with the sell-off in bonds, the Federal Reserve has halted its emergency $1.25 trillion program to buy mortgage debt, placing even more upward pressure on rates.

“Mortgage rates are unlikely to go lower than they are now, and if they go higher, we’re likely to see a reversal of the gains in the housing market,” said Christopher J. Mayer, a professor of finance and economics at Columbia Business School. “It’s a really big risk.”

From today’s Austin American-Statesman article “Amenities for Lease” :

As far as finishes, he says “granite is the new Formica” in apartments, good for property owners because it’s hard-wearing, attractive and low-maintenance for renters.

Luxury gone banal …

CRAAAAAAAAAAAAAAAAAAAAAASH!

That was the sound of housing prices collapsing in your neighborhood.

PB (too much up top to keep track of)

“Is my memory fading, or was it just a couple of days ago that he posted about how he could barely stand his position any more and was contemplating a move?”

I want to be clear: I love education, and I am o.k. with staying in Florida. The part that I could barely stand was legislation that would make what I do pointless. I choose to work with struggling schools and students becuase that is what I have a passion for. The State of Florida wants to base my pay on student test scores. That new bill, combined with my injury (not complaining, just stating a fact), made me consider if it’s all worth it. I want to keep working with at-risk kids, buit what’s the point if I am only going to make $25k/yr. and need a cane to walk?

The irony in our disagreements is that I spend most of my day showing children the joy of using science to solve problems, not just in science disciplines, but in their own lives.

As for RE, you treat this like it’s teeball, and when you decide, you’re going to step up to that plate and knock it out of the park. The reailty is that RE is Dwight Gooden on crack, throwing a 120mph spitball and all we all have is our own judgment of when is a good time to swing.

“The Worst of All Worlds”: Fannie and Freddie Losses “Can’t Be Calculated,” Posner Says
by Aaron Task

Government officials want you to know the cost of the bank bailout is going to be around $90 billion, much less than previously feared. But there is, as The Wall Street Journal put it, “one glaring exception” to this otherwise welcome news: The optimistic tally doesn’t include Fannie Mae and Freddie Mac.

Technically, that’s two glaring exceptions, but let’s not split hairs. The troubled mortgage giants currently enjoy an unlimited line of credit from Uncle Sam, and the CBO projects their investment portfolios — stuffed with subprime and other toxic mortgages — will suffer combined losses of $370 billion through 2020.

“I don’t think it’s time to celebrate [because] the losses inside Fannie and Freddie can’t be calculated,” says Kenneth Posner, author of Stalking the Black Swan. “Not only do we have those [CBO estimated] losses but we still have $5 trillion in mortgage-backed securities that they guarantee and $2 to $3 trillion in debt. All of this is potentially on the U.S. government’s balance sheet until we figure out how to restructure these entities.”

The GSE’s business model is “broken” but their role in guaranteeing mortgages is still critical to the housing market, says Posner, the former head of Morgan Stanley’s financial services research group. “Once they give their stamp of approval, those securities can then be sold and traded with great liquidity in the capital markets. If you shut that down right now, that would be counterproductive.”

UN process in danger unless world agrees on climate change.

The United Nation process is in danger of collapsing unless countries are able to agree on the best way to stop global warming by the end of this year, the outgoing head of climate change negotiations has warned.
Published: 5:29PM BST 11 Apr 2010

More than 170 UN countries gathered in Bonn this weekend for the first meeting on climate change since talks ended in chaos in Copenhagen at the end of last year.

Yvo de Boer, the head of the UN Framework Convention on Climate Change (UNFCCC), which is leading the talks, said small progress was made on technical issues.

He said officials will meet at least three more times before a final meeting of ministers in Cancun, Mexico at the end of the year where it is hoped the world will finally reach an agreement on the best way to stop catastrophic warming.

Posner: Govt. Can’t Prevent a Crisis But That Doesn’t Mean Taxpayers Have to Pay the Price
Apr 12, 2010 by Peter Gorenstein in Investing, Recession, Banking

Tech Ticker has talked to many guests recently about ways to prevent the next crisis, including Simon Johnson and Roger Lowenstein.

Today’s guest is Kenneth Posner, the former head of financial services research at Morgan Stanley and author of Staking the Black Swan. He says no matter the extent of regulation, the threat of crisis will always exist.

“The worst thing that Americans can do, would be to assume the government can protect them from crisis and make crises go away,” Posner states, declaring “crisis is the price we pay for innovation.”

Posner says it’s the government’s role to react quickly to crisis, minimize the damage and prevent taxpayers from footing the bill. He suggests two ways of accomplishing this goal of reducing the ‘price’ of innovation:

– Create a group of regulators, be it at the Fed or some other institution, who constantly monitor market conditions looking for potential risks. “I don’t think they could ever stop a boom in its tracks but if they’re anticipating the risk they could draw up contingency plans,” he says.

– Force banks to create contingent capital. “Make systemically important financial institutions issue a form of sub debt that automatically converts to equity in the event of a crisis,” Posner says. This would result in quicker crisis resolution and avoid the need for a taxpayer bailout.

Delinquent loans jump 21.3%
Jacksonville Business Journal - Monday, April 12, 2010

Delinquent loans jumped 21.3 percent in February compared with a year earlier, according to the latest Mortgage Monitor report released by Lender Processing Services Inc. Monday.

Florida beat all other states in its percentage of foreclosed inventory and noncurrent loans to active loans during the same period.

The Jacksonville company (NYSE: LPS) provides mortgage processing and technology services and has about a 70 percent share of the loan market and 40 percent of the real estate owned or foreclosed loans nationwide.

There were nearly 8 million noncurrent loans plus foreclosed loans nationwide at the end of February, up 26 percent from a year earlier. However, the total was down from January by less than 1 percent.

The percentages of problem loans as well as new problem loans were at a five-year high at the end of February.

More than 1.1 million loans that were current at the beginning of January were at least 30 days delinquent or in foreclosure by the end of February.

Florida topped all other states with a foreclosed inventory of 11.4 percent, and the highest percentage of noncurrent loans at 23.8 percent of active loans. The national percentage of delinquent loans was 10.2 percent, whereas Florida had 12.4 percent, which tied with Arizona as the fourth highest rate nationwide.

Other states with high rates of noncurrent loans as a percentage of active loans were Arizona, California, Georgia, Illinois, Indiana, Mississippi, Nevada, New Jersey and Ohio. The states with the fewest noncurrent loans were Alaska, Colorado, Minnesota, Montana, Nebraska, North Dakota, South Dakota, Vermont, Washington and Wyoming.

Total Crap:

My GF’s ex is in the Air Farce and is a desk-jockey who has never been deployed anywhere. He is moving to CA from FL and recently learned that he is an FB who bought the tippy-top in ‘06 and is currently underwater by over $150k (more than 50%). Looks like the taxpayers are going to make him whole:

http://www.upi.com/Top_News/2009/05/14/Military-home-assistance-program-expanded/UPI-64201242344681/

host.madison.com/wsj/business/article_f944322c-465a-11df-bfe9-001cc4c03286.html

Wisconsin set a foreclosure record in March, while Dane County’s total was the second highest ever.

Foreclosure filings in Dane County were up 42 percent in March compared to a year ago, with 180 new filings compared to 127 in March 2009, according to court records compiled by DaneCountyMarket.com.

Statewide, foreclosures increased a little more than 7 percent in March, with 2,870 compared to 2,678 a year ago. The previous high for the state was in July, when 2,757 were filed.

Year-to-date through March, filings in Dane County increased 16 percent, with 455 filings compared to 393 in the same period in 2009. Statewide, filings increased 4 percent through March, with 7,852 filings compared to 7,545 a year ago.

Dane County foreclosure activity has steadily increased over the past five years. The 1,695 foreclosures in 2009 represented a 302 percent increase from the 422 registered in 2004.

Nationally, through the end of February, the total number of delinquent loans was 21.3 percent higher than the same period last year, according to the latest Mortgage Monitor report released by Lender Processing Services. Although the data showed a small seasonal decline in delinquencies from January to February, the national delinquency rate still stood at 10.2 percent.

More than 1.1 million loans in the U.S. that were current at the beginning of January were already at least 30 days delinquent or in foreclosure by the end of February. The total number of non-current first-lien mortgages and bank-owned properties is now more than 7.9 million loans, Lender Processing Services said.

Just got a 0% for 12 months offer from Chase Bank today. Hadn’t received one of those for many months. I guess they are back to trolling again.

DOW hits 11,000.

I think Martin is correct, but I have no idea what makes him or anyone think that D.C. would put the breaks on spending. Not in the cards as I see it.

Our leaders still haven’t heard us! ~ Martin Weiss

Despite all our petitions and protests, Washington is still spending MORE … borrowing MORE … and printing MORE than ever before.

Look. Most people know that the federal budget deficit nearly quadrupled last year — from around $400 billion in 2008 to more than $1.4 trillion in 2009. What they may not realize is that …

In 2010, our nation’s red ink is more than TWICE as bad as the worst deficit during the Great Depression — an explosive force that would normally drive interest rates through the roof.

But the Federal Reserve has temporarily shielded the American public from surging interest rates by buying up nearly one and a half TRILLION dollars in bonds — financing the deficit with paper money.

If the Fed continues on this reckless path, inflation will explode and your dollar will be destroyed. And if the Fed does NOT finance the huge deficits, interest rates will surge.
Either way, there is only real solution: We must STOP the administration and Congress from spending and borrowing us into oblivion.

We must stop our leaders from stealing from future generations to finance and perpetuate the excesses of present generations … from sacrificing America’s future potential and stability on the altar of present expediency … from piling up more debt to deal with meltdowns caused by too much debt in the first place … from creating new financial bubbles to overcome the consequences of prior financial busts.

There’s no other way to say it. If America’s leaders aren’t forced stop this insanity immediately, the U.S. economy may never recover from the resulting disaster.

Lacking state funding, Census response rates lag.

OAKLAND, Calif. (AP) - State and local governments hammered by the recession have cut spending on outreach for the 2010 U.S. Census, leaving hard-to-reach neighborhoods with response rates that may fall behind the count a decade ago, officials said.

The funding cutbacks have come at all levels, and at a cost.

California, for example, dedicated $24.7 million to the Census 2000 campaign. Although an undercount could cost the state billions in federal funding and a Congressional seat, this year’s outreach budget is only $2 million.

Two weeks into the count, the state’s census form return rates are about 10 percent behind the 2000 total, officials said, adding that the numerical disparity would be worse without the efforts of philanthropic and community-based organizations.

“We need to make a push to make sure we at least stay even,” said Louis Stewart, deputy director of California’s census outreach. “There is a lot riding on this count.”

More than $435 billion a year is distributed by the federal government to states based on census-driven funding formulas. California could lose about $3,000 a year for each resident not counted in the 2010 census.

The 2000 census found 33.9 million people in the state. It is estimated that the population will exceed 38 million in 2010.

Residents have until April 19 to mail back their census forms. After that, their answers will have to be collected by census workers going door to door at considerable expense.

Is the President’s resume accurate when it comes to his career and qualifications? I can corroborate that Obama’s “teaching career” at Chicago was, to put it kindly, a sham.

I spent some time with the highest tenured faculty member at Chicago Law a few months back, and he did not have many nice things to say about “Barry.” Obama applied for a position as an adjunct and wasn’t even considered. A few weeks later the law school got a phone call from the Board of Trustees telling them to find him an office, put him on the payroll, and give him a class to teach. The Board told him he didn’t have to be a member of the faculty, but they needed to give him a temporary position. He was never a professor and was hardly an adjunct.

The other professors hated him because he was lazy, unqualified, never attended any of the faculty meetings, and it was clear that the position was nothing more than a political stepping stool. According to my professor friend, he had the lowest intellectual capacity in the building. He also doubted whether he was legitimately an editor on the Harvard Law Review, because if he was, he would be the first and only editor of an Ivy League law review to never be published while in school (publication is or was a requirement).

Consider this:
1. President Barack Obama, former editor of the Harvard Law Review, is no longer a “lawyer”. He surrendered his license back in 2008 possibly to escape charges that he “fibbed” on his bar application.

2. Michelle Obama “voluntarily surrendered” her law license in 1993.

3. So, we have the President and First Lady - who don’t actually have licenses to practice law. Facts.

4. A senior lecturer is one thing. A fully ranked law professor is another. According to the Chicago Sun-Times, “Obama did NOT ‘hold the title’ of a University of Chicago law school professor”. Barack Obama was NOT a Constitutional Law professor at the University of Chicago.

5. The University of Chicago released a statement in March, 2008 saying Sen. Barack Obama (D-Ill.) “served as a professor” in the law school, but that is a title Obama, who taught courses there part-time, never held, a spokesman for the school confirmed in 2008.

6. “He did not hold the title of professor of law,” said Marsha Ferziger Nagorsky, an Assistant Dean for Communications and Lecturer in Law at the University of Chicago School of Law.

7. The former Constitutional senior lecturer cited the U.S. Constitution recently during his State of the Union Address. Unfortunately, the quote he cited was from the Declaration of Independence, not the Constitution.

8. The B-Cast posted the video.

9. In the State of the Union Address, President Obama said: “We find unity in our incredible diversity, drawing on the promise enshrined in our Constitution: the notion that we are all created equal.”

10. By the way, the promises are not a notion, our founders named them unalienable rights. The document is our Declaration of Independence and it reads: We hold these truths to be self-evident, that all men are created equal,that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

11. And this is the same guy who lectured the Supreme Court moments later in the same speech?

When you are a phony it’s hard to keep facts straight.

(From Doug Ross @ Journal)

Eudora — Four hundred pounds of beef jerky cools in the stainless steel smoker in the back room.

In the front room, Tom Pyle grabs a seat at the employee lunch table, while son Pat wipes it clean from a homemade meal that his mother had brought them, as she does each day.
Eudora meat company to close after 50 years

The Pyle Meat Co. has been a family operation since it opened, but a drop in jerky sales is forcing it to close. Enlarge video
Tom Pyle, left, watches his son Tom Pyle Jr. package some of the last beef jerky Thursday at Pyle Meat Co. in Eudora. The company was in business for 50 years but is closing its doors as a result of the recession.

Tom Pyle, left, watches his son Tom Pyle Jr. package some of the last beef jerky Thursday at Pyle Meat Co. in Eudora. The company was in business for 50 years but is closing its doors as a result of the recession.

“Cherokee Fiddle” — an old Johnny Lee song — plays on the radio. The lyrics are about a bygone era. So too, it seems, is this.
Tom Pyle looks over a rack of jerky that is cooling, some of the last 400 pounds the company made this week. Pyle Meat Company in Eudora is making its last batch of beef jerky and sausage before closing up shop.

Tom Pyle looks over a rack of jerky that is cooling, some of the last 400 pounds the company made this week. Pyle Meat Company in Eudora is making its last batch of beef jerky and sausage before closing up shop.

“A lot of times,” Pyle says, “when people have something like this happen, they blame the bank or somebody. But I’m not blaming anybody. I’m just saying it is a sign of the times. It is what’s happening.”
One of Pyle Meat Company’s staple items, the Hombre Beef Jerky, sits on racks to cool. The company in Eudora is making closing up shop after 50 years in business.

One of Pyle Meat Company’s staple items, the Hombre Beef Jerky, sits on racks to cool. The company in Eudora is making closing up shop after 50 years in business.

The cooling jerky is the last batch for Eudora-based Pyle Meat Co. The company has been in business since 1959. Since the late 1970s, it has been making a name for itself by selling Hombre beef jerky and smoked sausages at convenience and grocery stores throughout the Lawrence, Topeka and Kansas City area.

But this nationwide recession has tempered the flames of backyard grills everywhere and has left many a lunch pail unused. Pyle now says what many business owners have felt — this recession has been unlike any other.

“It has been far worse than any other, maybe twice as worse,” Pyle says. “This time it hit almost all at once. I kept thinking it will be all right, it will be all right. But I was wrong. It’s not.”

Mortgage brokerage firms closing in face of new rules
News Business Reporter / Buffalo News

Dozens of mortgage brokerage firms locally and around the state have thrown in the towel in recent months, as the days of easy credit that super-sized the mortgage industry fade into the past.

Brokers say they have been frustrated by increased regulation, bad publicity and rising costs that have hampered their ability to make a profit.

Over the past year, firms such as Twinstar Mortgage, MultiSource Funding in Cheektowaga, Adelphi Financial Group of Cheektowaga, Alexis Funding of Williamsville, Expert Funding in Hamburg and Creekside Funding in Elma have surrendered their licenses to the state, as have some in Rochester.

The firms’ owners and employees have either gone with other, larger firms, switched over to work directly at banks or left the business entirely rather than deal with added hassles.

“It’s not as fun as it used to be,” said Brian Feldman, former owner of Expert Funding until he folded the nine-year-old firm and joined G.F. Brooks Associates as a loan officer.

“There’s a disincentive to stay in business,” said Ronald Michnik, owner of Independent Funding Service in Orchard Park. “A lot of good people have left the mortgage industry completely.”

http://www.buffalonews.com/2010/04/10/1015432/mortgage-brokerage-firms-closing.html

Area home sales up 22% in March, trade group says
Charleston, S.C. April 12, 2010

Local home sales increased at a double-digit pace again last month, marking another sign of stability for the real estate industry.

Preliminary data from the Charleston Trident Association of Realtors released today showed that 691 homes sold in March, up 22 percent from the same month a year ago.

The median price was $185,000 in March, even with the corresponding figure for 2009.

Year to date, home sales volume is up 23 percent over the first quarter of 2009.

“The activity in the early months of 2010 is incredibly encouraging — every month, we’re seeing sustainable growth in home sales and prices are holding steady” said Jeremy Willits, the association’s president.

Sales have been helped by low interest rates and a federal tax credit being offered to home buyers until April 30.

Inventory in the Charleston area remains high, with 9,849 active listings on the market as of March 31.

The Fed is more like Fannie, a GSE, rather than a government agency.

True?

You know, I hear absolutely relentless cheerleading for real estate purchasing on the local radio stations, and even in the papers. It’s almost as though there’s been an embargo on bad news. They have realtors and financial industry representatives on all the time cheerleading the market. There are very few places indeed which document any actual problems in the real estate market. Especially odd, considering that the high unemployment and global credit slowdown is based on bad mortgage loans.