Bits Bucket For June 16, 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
Location:Northern Arizona, United States
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It’s like having my own personal blog. A blank slate on which to scribble my pathetic tag. The glass on a subway door just calling out for a scratch which will be meaningless to others and only serve to remind me of the hollowness inside me.
No political scapegoating, name calling, pseudo-witticisms aimed to inflame the simple minded opposition. I can be the first to bespoil this thread like a BP exec on an endangered seabird sanctuary.
No “bye, fl” to confuse my brain, make me wonder if I’m having a stroke. No nhz to warn of us what might be to come in the US. No Big V threatening to castrate men for their transgressions.
OK, not really. It’s kinda boring actually. I can hear the realtors and economists calling out to me in the dead of night. Their siren calls trying to entice my portfolio towards their rocky shores. Seriously, someone hold me. I’m not used to being alone.
Love ya, bink. I never thought I’d say this, but I kind of miss bye,fl,too.
At some point we really do need a “where are they now?”
Do you think he or she ever made it to their promised land of Oil City, PA?
Aloha, Bink
Thanks for that entertaining description of the trains in Hawaii. You’re not alone, you’ve got a whole blog to wrap around you.
Here’s some CONtent for you, bink. I don’t see this one posted below at this time.
Wall Street Journal June 16th
High Default Rate Seen for Modified Mortgages
by James R Hagerty
Fitch Ratings Ltd forecasts that most borrowers who get lower mortgage payments under a federal government program will default with 12 months.
Among those with loans that aren’t backed by any federal agency, the redefault rate within a year is likely to be 65% to 75% under the … Home Affordable Modification Program…
Fitch based the redefault forecast on the performance of loans that were modified in the first quarter of 2009. …
At the end of April, about 295,000 households were benefiting from long-term modifications under …the $50 billion HAMP program. …
*********
[sounds like a lot of taxpayer money thrown away, even if the program were "working"]
If you default on your modified loan, do you get a new modification ? And if so, how far can you take this process ?
I was up late in Cali time and saw the bits go up. Kind of thought wonder if Bink is posting….
Aw Bink, don’t take it personally. I was only gonna circumcise you.
Circumcision certainly beats castration.
Next you’ll tell us you are really just a philatelist.
Apartment Leases, Rents Pick Up
UDR, AvalonBay and Rivals See Turnaround Signs; Pockets of Weakness Remain
Apartment operator Associated Estates Realty Corp. watched rents on new leases fall 8.8% in December, the biggest year-over-year drop in its 35-year history.
But in May, some relief: Lease rates turned positive, climbing nearly 1% from a year earlier. “It’s small, but a positive indication of the turnaround,” said Jeffrey Friedman, chief executive of the Ohio-based company that owns nearly 13,000 units.
UPTURN WITH A VIEW: Apartment landlords are beginning to see signs of improving market trends, with Associated Estates Realty seeing leasing rates turning positive in May.
For the first time since the downturn, some of the nation’s largest apartment-building landlords are reporting that rent declines have stopped and some are even boasting modest increases.
FBs who have been living rent free are finally being forced from their homes. They have to live somewhere and actually pay for shelter again. This will be a drag on the economy as some estimates have placed the “stimulus” of not paying mortgages at $60-90 billion a year. Also, apartment REITs have been on a tear as the market has been anticipating increased apartment demand from foreclosed FBs. This trade works in the short term, but eventually those foreclosed homes come on the market and compete with the apartments.
What about the “severely burdened”, who according to the Harvard study, who have had their other spending crowded out because of trying to hold on to their house for dear life?
I’m guessing that the $60-$90B per year is only the deadbeats that haven’t been paying a dime to their lender.
Said another way–
If you have one deadbeat who finally needs to pay rent, that is negative “stimulus”, however, if that deadbeat is combined with two people who were not strategic defaults, and simply lost the house despite their best efforts, as long as they have a job, becoming a renter will actually free up MORE cash flow, increasing “stimulus”.
Of course, the latter “stimulus” helps the non-banking economy at the banking economy’s expense. Since we have already more than bailed out the banks (they are sitting on big piles of cash), I think this would overall be a net positive for the main street economy, as long as the “strategic defaults” are outnumbered sufficiently by the “honorable to a fault” crowd. I’m not sure whether this is the case, as the “strategic default” crowd is something like 1/3 of defaults today…
What a friggin’ disaster…
Great insight. There’s also all of us “FR’s” to consider — that is, us renters who have been keeping our powder dry waiting for housing prices to come down at some point. Granted, we’re a small segment of the population, I’m sure, but we probably have at least a little effect on rents.
IIRC, “apartment landlords” have never admitted to a decline in rents. Funny how, all the sudden, the nonexistent decline has halted. These ppl are full of it. I don’t see rents going up anywhere.
Rents have come down here, but not significantly. But they haven’t gone up either.
I think it’s the usual summer college movement.
Similar article was in the Norfolk, VA newspaper about rents starting to go up. Then of course some puff piece about all the happy Military families moving to the area buying their new homes.
Best Buy shoppers spend less than expected for qtr
NEW YORK (AP) — Best Buy shoppers spent less than expected this spring, contributing to a rocky first quarter for the chain and disappointing Wall Street, but executives said the weak results don’t mean Americans have less of an appetite for electronics.
The company’s profit edged up 1 percent but fell far short of what analysts were expecting. Best Buy stock tumbled 6 percent.
Company executives pointed out Tuesday that the first quarter makes up just 10 percent of Best Buy’s annual revenue and expressed confidence in Americans’ demand for products such as phones and computers.
Best Buy can kiss the south end of a north bound donkey.
I can’t think of any place more overpriced.
You’ve obviously never been to a D’Agostino grocery store in New York City.
Hell, the name of that store gives me advance warning that I am going to get hosed…
Oh, there are little farmers markets all over NJ and in parts of NY that have similar names.
Those places have actual good prices though.
D’Agostino in NYC? How about Whole Foods (aka Whole Paycheck) anywhere?
Bristol Farms has ‘em all beat, I’m pretty sure.
Bristol Farms is insane. I used to hit the one in Newport next to Sprinkles Cupcakes. Conspicuous consumption at its finest.
This post ties directly to the previous posting. As FBs finally get forced from their homes they have to start paying for shelter again leaving less to spend at BBY.
I’d like a new toolbox. The metal Craftsman’s at Sears are all made in China, user reviews say they’re crap. Snap-On has made in USA ones, probably very good quality… but they’re $385.00. Does anyone have any insights? I’m just looking for a medium-sized box, preferably with a drawer or two (not three.)
Shop or field type?
For just a standard garage/shop tool box I think that Kobalt makes a good one. I have no complaints, check with Lowes and see what you think. Don’t remember the prices, but not up there with Snap-On.
I`m pretty sure Kobalt is china. All their kobalt tools are made in china. I have a big snap-on box I love the quatily. Craigs list is a great source. As far as craftsman find a used one several years old, it will be better than new. I have been finding better stuff that is old and better.
Lane
Go find your local Snap-on guy/guys. Or a MAC/MATCO guy. They usually have several trade-in/buy-back/reposessed boxes sitting in a garage or storage unit somewhere.
You can usually get a deal on a used box, although Snap-on usually deals with the bigger roll-away type than the smaller ones.
And……cash talks.
It’s pretty sad when even Craftsman sells out.
KMart owns them now.
I think they are selling craftsman at ace hardware now.
snap-on and mac are great tools but expensive.I like craftsman but im pissed to learn they sold out to import labor.
Has anyone been to a kmart lately, what a dive.It wont be long before both sears and kmart are gone imo.Sears is so outdated inside.It would cost them a fortune to modernize those stores.Their apparel is horrible.the only thing they have worthwhile are the tools.You can get better deals on appliances and electronics elsewhere.
You can get better deals on appliances and electronics elsewhere.
I don’t know - I got my LCD TV from Sears. They price match, and have a good return policy. Much better overall experience and comparable price to BBY or Fry’s.
Agree on the clothes. The absolute pits - their buyers are clueless.
My advice would be to watch craigslist for snap-on, mac, etc. tool boxes being sold by retiring or out of work mechanics. I have had a craftsman two box roll-away tool chest for 20+ years. It’s crap compared to the professional brands. In all fairness it does work. When I buy my next boxes I will be following my own advice.
If you must have brand-new, you’re probably SOL. SV guy’s advice is good, try CL or do a google shopping search for a vintage or “previously owned”, but well cared for box. You can narrow the search to sellers closer to where you’re located, so you can either pick up or cut down the shipping costs. Google shopping search is a great tool for those hard to find items. Just click on “shopping” at the top of the Google home page and then use the search engine.
palmetto,
Unfortunately, you’re right. What a sad statement, if you’re talking ‘quality’ ( then you’re talking ‘used’! )
I tend to be a little wary when buying ‘used’ tools, as in used by ‘whom’? And why are you selling them so cheap? To the Meth crowd tools are as good as currency.
“well cared for box”
This doesn’t mean “looks like new”. Toolboxes get moved around, and scratched/dented. The thing is, a twenty year old Snap-On box that hasn’t been dropped off a dock is worth repainting.
Of course, it’s always possible to find some guy that keeps a Snap-On box at the house.
SV guy…100% spot on!
Lane
Also try craigshelper. Its a grouping for CL. Put in distance and item and find it. I just bought a Little giant latter with all attachments for like $275….used once.
Lane
two words: craigs list
Find a friend - or a friend of a friend who knows a mechanic at a large garage or who works as an aircraft mechanic (A&P). Snap On comes out to them once every few months to model new stuff and sell them tools and equipment they need - most are at cost or just a few percent higher.
I work in the aviation field and always mean to swing by when I see the Snap On rig by the hangar.
Thats what I do. I have the snapon dealers name for s/w charlotte, Tommy T. and I`ll meet him on the road at a stop. He gives me a break for paying in full and he knows I`m a shade tree tech. I have spent alot but have saved so much in money and time. Just changed out a light in my 530i it has a funky frount light. $160 at the dealer…I bought the light bulb for $30 and did not have to leave the house. Same with spark plugs…$30-35 bucks and takes me 30 minutes. Dealer $200 bucks. People say you can`t work on newer cars….I think they are easyer to work on…at least BMW is for me.
Lane
My friend who worked as a car mechanic said those snap-on trucks are like ice-cream trucks loaded with crack to mechanics.
Agreed.
Back during my bike shop days, Bob the Boss had a Snap-On socket wrench. If you were really good, and asked him very nicely, he’d allow you to borrow it for a few minutes. And you’d have to clean it fully before returning it to him.
It was a nice wrench. I still miss having access to it.
sfbb,
( And sorry to hear about your little “run in” btw ) You’re right, they’ll get a fraction of retail. Freakin’ sad, hope mom is o.k )
Guys, all kidding aside, we talk a lot about our gold positions and our shorts and our precious CD’s etc. but TOOLS are going to be one of the most valuable commodities going forward!
These guys parting company w/ their livlihoods ( to keep their FB Loan afloat (1) more month… ) are going to be filled w/ nothing but regret!
One of more core beliefs is that ( if you have even the slightest doubt as to a meltdown ) is that any survival ’strategy’ ( Beyond lead and MRE’s ) had best include a well stocked machine shop! And we needn’t see MadMax-type meltdowns for that to become apparent.
Ha ha, yea. Or like mary kay for women. I started buying their tools in about 1980-1981. Its good stuff. Its funny I`m very tight on things like beer or other disposable stuff but buy the best when it comes to shoes,tool,appliances luggage and so on….my reasoning, and it has worked for me….buy great stuff and wear it out…its cheaper in the long run and you get to enjoy a great product.
Lane
The Snap-On dealers don’t visit the airplane shops around here any more.
They know that airplane mechanics can’t afford their tools, so they hit the auto repair shops, car dealers.
Our mechanics still have to buy their own tools, so you’ll find a nice one lying around every once in a while. Funny, when I call over the radio that they left something in the airplane I’ll have 5 or 6 mechanics burning rubber to pick it up - all claiming it’s theirs.
That can backfire…….
Airplane came into our shop, #1 engine had the fan, fan stator, outer bypass/fan case and the first stage stator in the engine core tore completely to $hit…….mucho damage, mucho money to fix.
When we got it apart, we found a pair of dykes (diagonal cutters) jammed in the stator.
Owner of aircraft took it back to his home base. Started asking all the mechs in the shop if they had lost a pair. One guy looks at them and says “Yeah, they are mine……where did you find them???”
Moral of the story: Never mark your tools voluntarily. Consider any that go MIA as the cost of doing business. Nobody EVER returns good tools that they find, unless they have some other reason to identify the owner. Plausible deniability is your friend. You can buy a whole new box of Snap-Ons, vs. what it will cost to get your job or license back.
When we got it apart, we found a pair of dykes (diagonal cutters) jammed in the stator.
Owner of aircraft took it back to his home base. Started asking all the mechs in the shop if they had lost a pair. One guy looks at them and says “Yeah, they are mine……where did you find them???”
Nothing like a dumb mechanic. Reminds me of when I worked in the bike shop and Bob the Boss hired this big talker to be the lead mechanic. Turned out to be a disaster.
After he was fired, some guy came into the shop with a bike that needed a flat tire repair. This required removing the tire, and gawd was that a struggle.
It seems that Andy, our ex-lead mechanic, had installed a 700C tire on a 27″ rim. The 700C rims are about 6 mm smaller than the 27″ rims, and that was the reason for my struggle.
Oh, I should also mention that all of our tires were clearly marked. Not to mention the fact that, out on the sales floor, we displayed them by size.
Last time I saw Andy, he looked like he was homeless.
If you want to save some serious $$, try craigslist.
Have bought many a power tool on craigslist.
(BTW, I am looking for a rollaway myself)
It’s great to find heavy, bulky items in your area that
would not make $$ sense to ship.
Lot’s of great deals out there..
ie.
Got a huge deal last summer on some primo Bosch
tools from… (insert drum roll here) a neighbor
who was forced to move because she was
getting divorced and foreclosed on.
( Was selling ex’s power tools “to get even”.. It was quite
a tale to listen to…) Of course, that could never happen
in Orange County fantasyland, let alone Irvine! )
Craigs list or Pawn shops.
Pawn shops. That’s exactly right, I forgot that one. Great place for a deal, too. Pawn shops have so many tools and related items these days, you can negotiate.
Not where I live. Pawn shops are the most expensive place to buy.
Don’t ask me why. *shrug*
craigslist
ebay
How many tool boxes are you going to buy in your life? This is one of those spring for the good one times. Get the snap-on and enjoy it for the rest of your life.
I see nice old tool boxes at the Goodwill/Salvation Army all the time. I recently bought one of those adorable metal cabinets with tons of little plastic drawers in it to hold nuts/bolts/etc… I think it was 7 or 8 dollars. It might take you some time, but that’s why I like to call it treasure hunting. Also, check out yard sales. That’s where you get your pick of the pre-thrift store booty at a fraction of the price.
-wittbelle
(Soon to be seen on “Hoarders- Buried Alive”)
wittbelle,
Excellent. It took me years… to fully outfit my shop! Every year my wife’s employer holds a “garage sale” and we’d get soldering stations, test benches, volt/ohm meters.
( still holding out for an oscilliscope but Rome wasn’t built in a day! ) Every ‘bit’ of it American-made too I might add. Takes time.
Booty. That’s a word that doesn’t mean what it used to mean.
I’ve been hoping to find a Spectrum Analyzer for our little geek clubhouse in Norfolk (www.757labs.org.) No luck so far. As time goes on technology kills. Casio just released a video projector that uses 24 x 1 watt blue laser diodes. $50 a diode or less. Killed the blue diode laser market in one swoop. No more $1000+ for 100mw chinese units off of ebay.
I confirmed what you’re saying via Google but can’t find an explanation of why that’s special. Care to enlighten us non-laser-geeks?
Have you checked the garages of local FB abandonment houses?
I have cheapy junk-sets for around the house and everyday plumbing repairs etc. I don’t care if they get rusty or even left behind/lost etc.
You can go to the Dollar Store and replace them for.., well a dollar! But no, I don’t think anyone in their right mind is going to leave Snap-On’s just laying around, not when they’re basically ‘cash’.
It sounds impossible, I know, but I have personally witnessed abandoned houses that were left fully stocked. Nice clothes, furniture, equipment, etc.
I really don’t know why the FBs do it. I’ve hypothesized that perhaps some of them were in jail, or had to run away from thugs to whom money was owed, but that seems pretty far-fetched. I wish I had some insight as to why some people are leaving valueable items behind.
“But no, I don’t think anyone in their right mind is going to leave Snap-On’s just laying around, not when they’re basically ‘cash’.”
Really! I didn’t know they were so valuable! Thanks for the info guys! I think the next time I don’t get my own way with the Hubby I’ll just threaten to drag those big, red, metal suckers out to the curb and sell ‘em for shoe money! :D:
j/k … maybe
“shoe money!” LOL
( I… didn’t realize there ‘was’ such a thing? ) You’d think I’d know better.
X-GSfixr I believe has the last word on the topic. And that is, Is it worth salvaging!? If the answer you come away w/ is no, then keep looking!
My set up is much more for electronics than overhauling tractors/heavy equip. but I have (2) SIL’s that cover ‘that’ end.
Craigslist. Get the older sears one.
Thanks for all the input. I’m looking for a field carrying box. I just don’t want a piece of junk. I read somewhere that Stanley’s hard plastic toolboxes come with a lifetime guarantee. I’m skeptical.
Since it is not governments roll to “create” jobs (never was) this should not be a dilemma. However since ‘they’ took up that roll long ago, it’s easy to see how they are painted into a corner. They will keep right on printing us into the abyss. Their greatest fear of course is not getting re-elected, to hell with the country.
Congress in ‘Vise’ Over Job Creation, Cutting Deficit.
(Bloomberg) — Voters are forcing Democrats into an election-year equation they may be unable to solve: How to spend more money to create jobs and at the same time reduce the federal deficit.
Democrats have abandoned billions of dollars in proposed jobs initiatives to avoid adding to the deficit, risking that a pending bill may seem ineffective to the 15 million unemployed. To further cut costs, they added more than $50 billion in taxes on buyout managers, oil companies and other businesses, seized upon by Republicans as job killers.
Yet there are few signs Democrats’ contortions to avoid adding to the deficit are winning over voters, especially when the savings are compared with this year’s $1.5 trillion budget shortfall.
“We’re in a vise,” said Representative Gerald Connolly, a Virginia Democrat who is president of his party’s freshman class in the House. “It’s a real dilemma.”
To use a hoary old pharase: Hoist on their on petard.
Verb is there, but where is the object?
Creating the conditions that keep the economy humming and unemployment down is very much the job of government. I also want gov to create jobs if there is massive unemployment. Massive unemployment leads to poverty, crime, political instability.
I’d do away with unemployment and welfare. Money for nothing should be outlawed.
so where does the money come from to create these jobs and pay these people?
Step 1 - Use all the money currently used for welfare and unemployment benefits to create jobs. I don’t care if it’s carrying rocks up a hill, but I can certainly think of better uses.
Step 2 - Tax oil and gas slash payroll taxes for business and workers. Greg Mankiw who worked for bush has recommended this.
Step 3 - Cut spending on wars.
Step 4 - Do away with tax breaks for Hedgefund managers and Wall Street and CEO class that allow them to pay effective tax rates of 15%. I’d probably add another tax bracket for those making over a million a year and cut taxes for the middle and upper middle class.
The Fed’s magic printing press.
Sorry but it is not governments roll to CREATE jobs, never was intended to do that. They are saying “create”, not create a friendly fair level playing field environment. It does take much reading of our countries foundation to verify this fact.
It also “does take much reading of our countries foundation to verify” that the gov is not prevented from creating jobs.
It also “does take much reading of our countries foundation to verify” that the gov is not prevented from creating jobs.
The role of those documents was not to say what the gov’t COULDN’T do, but rather what it was AUTHORIZED to do.
The role of those documents was not to say what the gov’t COULDN’T do, but rather what it was AUTHORIZED to do.
I disagree. Where does it say that? Where does it say that nothing other than what is authorized on those papers can be done ??
Where does it say that nothing other than what is authorized on those papers can be done ??
Wouldn’t that be the tenth amendment? At least when it comes to what the Federal Government can do. Doesn’t mean it can’t be done at a lower level, though.
I don’t think the supreme court would see it that way. The federal gov can hire as many people as it wants. This is no infringement on states rights.
so starvation and possible anarchy is your solution?
It is every government’s overarching role to promote peace, domestic tranquility, stability, and promote the general welfare of its citizens.
Measton is right. High unemployment and lack of any income will lead to disturbance, violence and political instability if not outright overthrow of the government.
This is not semantics or morality, but historical reality.
And if it isn’t the government’s nor the corporations’ responsibility to create jobs, then just who’s job is it?
An entity or organization that makes demands upon its people without providing opportunity is the very definition of tyranny.
Since it is not governments roll to “create” jobs…
That’s just how they roll.
Well, thank goodness the financial companies and their management teams are doing well. All the trillions funneled to them are were absolutely necessary. Because without these particular financial companies, the current and future economic outlook would be much, much worse. It’s not like these bailouts are going to encourage more of this kind of behavior either.
The small people should be thankful for whatever crumbs they receive back from their tax dollars.
House passes tax cut for small business.
Investors would be free of capital gains taxes.
WASHINGTON - Long-term investors in some small businesses would escape capital gains taxes under a bill passed by the House Tuesday as congressional Democrats tried to revive their jobs agenda.
The bill would also increase tax deductions for startup expenses by new small businesses. The House passed the bill on a mostly party-line vote of 247 to 170.
House Democrats plan to merge the bill with legislation creating a $30 billion fund for community banks to increase lending to small businesses. The House could vote on the lending bill as early as Wednesday, sending the entire package to the Senate.
The House passed the bill…
snooooze. Wake me up when something passes the Senate.
And who were the Republicans who voted against tax breaks for small business? At the point you may as well vote against apple pie and hit the trifecta.
And who were the Republicans who voted against tax breaks for small business?
Sounds like pretty much all of them voted against it. But I’m sure they have some noble talking points explaining their hypocrisy.
( Couple this w/ revoking the CGE on primary residunces* and I think you’ve got a winner! )
No seriously, at this point any development along those lines is welcome news. At least they’re finally talking about it? Kind like walking thru the desert and happening upon a glass of water?
What else is in the bill? One of those we will cut 1 in tax an dpend 2 new dollars on union pet projects. And since when do the libs here favor tax cuts? I thought taxes were too low. Make up your minds dudes.
Eddie, libs think taxes are too low ON THE RICH and favor tax cuts FOR THE MIDDLE CLASS.
Stop trying to equate all taxes into that one blobulous “taxes.” We have one Rush Limbaugh we don’t need any more.
Eddie before you flap your gums why not look at the bill and get back to us. If you’re too lazy to look it up, go and get your info from Rush, or Glen Beck, I’m sure they will tell you why the GOP voted against tax cuts for small business.
LULZ. You guys are a trip. Anyone disagrees with the soclalist utopia and it must be, absolutely must be due to Limbaugh or Beck. Oh and I must be racist too, yes? You’ve become parodies of yourselves.
UPDATE 1-Chicago’s Corus Bankshares files for Chapter 11
NEW YORK (Reuters) - Corus Bankshares Inc (CORS.PK), whose banking unit was seized by U.S. regulators last September amid soaring losses on condominium loans, filed for bankruptcy protection on Tuesday.
The Chicago-based company filed for Chapter 11 protection from creditors with the U.S. bankruptcy court in Chicago, showing assets of $314.1 million and liabilities of $532.9 million.
Corus also announced the resignation of Chief Financial Officer Michael Minnaugh, effective June 30.
U.S. regulators seized Corus last Sept. 11 after the lender crumbled under soured commercial real estate and condominium loans in Arizona, Southern California, Florida and Nevada.
* Corus was 7th largest U.S. bank to fail in 2009
Jeez….. it took long enough.
Corus was the same crime syndicate that was offer ing 5%+ CD’s while the rest of the banks were sub 3% during the bubble years. I was expecting Corus to implode in 2007.
“it took long enough” LOL, yeah no jive.
You’re right, the “brokered CD’s” had to become ever more appealing in order to continue to attract assets and keep their ponzi going. Had it been you or me they’d have shut us down the following week.
During the S&L fiasco in the early 80’s some of the Texas S&L’s were paying 13% on FSLIC insured CD’s. The WSJ published high rate CD’s, kind of the pre-internet BankRate.com. I put $20K or so into one called Meridian Federal S&L and it promptly was seized by the FSLIC. It took me about 6 months to get my principle back, and it earned no interest during that time. At the time I wondered how they could pay that high of interest. The simple answer, they couldn’t.
‘UPDATE 1-Chicago’s Corus Bankshares files for Chapter 11′
Hmmm, it was Corus that prompted me to look into the real estate bubble phenomenon over four years ago. Someone posted on a message board that Corus was over their head with condo loans and I was like what? Just could not picture banks fouling themselves up with something like loans on good old real estate. So in a non-indirect way I can thank Corus for discovering the HBB.
Appears the far left aren’t happy with Barry…
Chris Matthews, Keith Olbermann and Howard Fineman react to President Obama’s Oval Office Address on the oil spill. Here are the highlights of what the trio said: MSNBC
Olbermann: “It was a great speech if you were on another planet for the last 57 days.”
Matthews compared Obama to Carter.
Olbermann: “Nothing specific at all was said.”
Matthews: “No direction.”
Howard Fineman: “He wasn’t specific enough.”
Olbermann: “I don’t think he aimed low, I don’t think he aimed at all. It’s startling.”
Howard Fineman: Obama should be acting like a “commander-in-chief.”
Matthews: Ludicrous that he keeps saying [Secretary of Energy] Chu has a Nobel prize. “I’ll barf if he does it one more time.”
Matthews: “A lot of meritocracy, a lot of blue ribbon talk.”
Matthews: “I don’t sense executive command.”
Hmmm. Curious. I saw it on the Weather Channel and they did an inset screen with Opie in the corner and file footage of tar globs and oil covered stuff on the rest. At the time it seemed a little out of the ordinary, and dare I say, a little harsh? Very interesting indeed, I wonder what’s up?
There are those that want our government to seize BP and strip them of their assets. I read there are some 300 law suits already filed against BP. So at some point I think they will file BK for their US operations, who knows, time will tell.
One thing is certain it’s one giant clu$ter f…
We live in interesting times.
seize BP and strip them of their assets ??
IMO, so we can keep them out of the hands of China…
Of course when the oil companies are doing well and making a lot of money, they also want the government to seize their assets. Remember the “windfall profits taxes?”
Some people will only be happy if/when oil is nationalized.
It’s too bad that BP isn’t owned by Venezuela, because that would create a really interesting dilemma for Barry.
Sigh, I guess everyone’s a critic. As far as speeches go, and I’m talking just the delivery itself, I thought it was pretty good. He almost had me convinced he cared. Until he got to the last part of the speech and made the pitch for clean energy. I don’t disagree with clean energy, I’d like to see it, but I don’t think now is the time to make such an obvious pitch. What was glaringly missing was a solution to stop the gushing oil, or at least mitigate the flow, and an announcement of taking some BP executives and engineers into custody.
BTW, this is for ecofeco: Yes, there IS deepwater blowout prevention/fix technology. It’s a variant on the same technology that was used to build the Pyramids. And everybody oohs and aahs about how the Pyramids are a technological marvel.
The most interesting thing I’ve seen on this in the past few days was the note that even Haliburton thought BP was taking too many shortcuts. Probably they have most of the qualified engineering.
Would be interesting if they end up figuring out a solution to all of this.
Probably cause Measton/Exeter/Ecofeco to have some kind of seizure and meltdown.
It was a pretty speech. You all should have been alerted by seeing the guy off the teleprompter in the debates. Away from memorized canned answers he is another empty suit.
This isn’t a conservative vs liberal thing here either. I didn’t bother voting for mccant. It’s just that I’ve been stuck in dis-corporate America for a while. Seen a lot of pretty boy speakers that were just like Obama. Deliver a good line and make a pretty public face. But when the SHTF these guys crumble.
All the alternate energy stuff is crap. We have plenty of electrical capacity and no sense getting away from inexpensive existing sources. Big problem is transportation fuel sources and distributed architecture of suburbs. Proper solution would be mass transit investment and I’ve got plenty of ideas there. Maybe short range electric loaners. Possibly some other large tax breaks and incentives for consolidation.
Problem is UAW and now all of GM are in the government pocket book. Not to mention banks and NAR. Hence they will not go after any of those kind of solutions.
In the 60 days or so since the blow out, nearly 6000 people have died in motor vehicle accidents, many times that number maimed, and wildlife by the thousands have been killed by autos in the US. 700,000 or more killed since the Exxon Valdez with an economic toll many times what will result from this spill. Long ago, we made our deal with the devil that we would accept significant economic & personal dislocations for the privledge of driving where we want when we want relatively inexpensively. This spill is a direct result of that decision.
There is no doubt that this is a environmental and ecological disaster and the response has been less than optimum. But because it is more or less a one off problem, that should not be unexpected.
At some point in the next few months, the well will be capped, and over the next few years the resulting damage will be mitigated both naturally and through clean up efforts, and five years from now it will be a distant memory for most of us.
Political posturing by the politicos and feigned horror by those of us who rely on BP and the other oil companies to provide our transportation fix will not hasten the capping or recovery effort. We will learn much about how to prevent and respond to this type of disaster, but nothing about how to prevent or respond to the next type of disaster.
Spokaneman,
THAT good Sir is sober headed and clear thinking ( and as such will ‘not’ be tolerated here!? )
You forgot those who are fanning the flames in order to buy stock on the cheap.
‘Are you f–king happy? Are you f–king happy? The rig’s on fire! I told you this was gonna happen.’
Deepwater Horizon installation manager Jimmy Harrell, on a satellite phone call to Houston as the rig was exploding. (Newsweek)
—-
Doesn’t sound like it was a surprise to those involved. And how, exactly, do we know that this is a ‘one off experience’? Was the first space shuttle to explode a one-off? It was until the next one exploded.
I don’t think driving a car means we can’t be angry about a clear failure to follow proper safety procedures. Following that logic, we shouldn’t get angry if someone kills a bunch of people with a car-bomb. ‘Hey, we chose to drive cars. We should expect such things.’
I guarantee this won’t be a distant memory in five years to anyone who lives down there. There’s still oil all over where the Exxon Valdez went down- twenty some years after the fact.
Just perspective. For those whose loved ones have been killed in auto accidents the deal with the devil wasn’t a good one, for the rest of us, its ok. Not saying we shouldn’t be angry that shortcuts were taken, but we better realize that they always will be, and there will always be disasters as a result. My point is the feigned anger and the political posturing by those who have not been directly impacted by the spill is disingenious. All of that anger and posturing is not going to shorten the duration of the problem.
It just blew me away when I read the Colombia report, and found out that they had never done any bird-strike/impact testing or analysis on the leading edge panels.
That’s practically an ‘Aircraft Design 101″ deal.
Why would I have a meltdown if they figure out a solution? That makes no sense.
We already know the cause. A BP exec trying to cut costs, overrode the on-site lead engineer. This is now a fact of Congressional record.
XGs,
Not sure why you’d do much of a bird impact study. On the way up going vertical there aren’t many birds.
On the way down you glide.
The other problem is they know the answer to what happens if you hit a bird. The space shit blows into a million peices. Not a big reason to study that.
@alpha,
I’ve seen this kind of thing over and over again. Was sitting with a tech fellow, very senior and discussing a major failure related to someone eliminating a testing safeguard. We had these tiny “simple” parts called attenuators and somebody decided to eliminate temperature testing to save a few thousand dollars.
Turns out the “simple” part is an elaborate 3d structure in a press fit spring loaded mechanism. We kind of looked at it and made the mental decision to never fly one again. Ever.
We probably saved 20-30k$ on skipping temperature testing. Ended up costing us around 1M dollars of investegation and delays late in a program launch.
First time we had ever seen a failure like this.
About the time that all was getting finished another manager was proposing skipping temperature testing on some other modules. I went through the reliability data and showed there is some substantial failure rate detected only at temperature. Often these failures indicate weak parts that are likely to fail at normal opperating temperature. Went through and made a nice 15 page presentation on the data.
The guy proposing the change went through and cherry picked data and claimed we never saw that kind of failure. The people in charge told me I was resistant to change and not a team player.
So, we were supposed to be notified and go before an executive review of the changes. Well, turns out they forgot to tell me when it happened. His two page presentation was enough to swing them through.
Before the change was introduced, we had some failures at hot and cold temps in the lab of the production run. I didn’t hear about them for months BUT didn’t stop people from accusations of sabotage. Nothing official mind you just some insinuation at high levels.
As far as I know the elimination of testing is going forward anyway.
Another great example: we were forming coaxial cables. Just like bending pipe. For some reason there was a step in the processing where the parts were thermal cycled after forming. No one could remember why that was done. Takes about 2 weeks for the process to complete. What does our manager do? Eliminates the step. I objected and said that while I don’t know why that step is in there it must be for some important reason. My recommendation was to get with the mechanical experts first. The expert they found didn’t know why it was a step either or what it was for, this being a mechanical design lead 200k a year guy. He figured it would be OK since… not sure based on what… guess if you don’t understand something it was OK to do what ever.
As it turns out the teflon filler in the cables is pressed in under tremendous pressure. When you flex the cables the teflon starts to relax and puts pressure on any connectors on the cable. In a stroke of good fortune, the cables failed early in the process vs after launch where it could have crippled the bird. The pressure was high enough to cause the soldered on connectors to pop off. Neat!
This is life in big companies… you get some game player short cut guys that get to the top. They keep gambling and taking risks and moving around till they get caught. Most are surrounded by yes men buddies and spend most of their time manuvering to take credit or avoid blame.
There are disagreements in engineering decisions and then there are company politics. You get a bad enviroment, like my current employer has been morphing into over the last deacde, and then you get some major failures.
The only way these places tend to change is through life or death crisis. Same with places like GM. Most of them just circle the toilet bowl as long as possible and will sit there and bleed you as long as they can.
Sounds like a bad enviroment from what I am hearing. Similar to GS and their very flimsy firewalls between setting guys up with lousy investments while taking a short position.
James, I believe Ex-GS was referring to the foam from the fuel tank that struck the wing of Columbia, sealing its fate upon re-entry. So where a bird strike may or may not be relevant, impact certainly was.
palmetto, do you have a link for that blowout fix tech?
BOPs have been around for ages, but I am unaware of POST disaster fixes and would be interested in learning about it.
If Chris Matthews is far left then I’m a belly dancer.
Maybe “hardened left” would be better.
“hardened left”
( A more accurate term I’ve never heard! )
Not to get any more pol. than we already have but I watched Rachel Maddow last night ( and she is kind of funny at times ) and they had a pre-view for Matthews’ “The New Right”.
I was frankly a little shocked he drew immediate parallels to Mcarthyism ( and the Tea Party? ) and every unflattering comparison he could think of! Pretty “hardened” where ‘I’ am concerned?
Still, I think measton, exeter/s, oxide and others have toned down quite a bit so I can’t condone counter attacks on BO on a daily basis. ‘Objective’ appraisal, fine!
OK, where do you perform?
Liiiiiiick………SMACK!!!!!
(Sound of X-GSfixr sticking a dollar bill to his forehead).
“If Chris Matthews is far left then I’m a belly dancer.”
if you are going to start doing this for a living you are going to have to work some salads into the diet.
Yup…. uh huh… Chris Matthews… that harden liberal that voted for Reagan twice.
You clowns are beyond laughable.
exeter,
Please, just please. Everyone alive ‘today’ was a very different person in the 80’s than they ‘are’ today. I’m sure I’m not the only person that tires of the excess wiggle room people create for themselves by saying…
“And I voted/supported/backed for so-and-so back in the day!” In fact, I totally discount it. What you’re doing today is what counts.
Firstly, once the drapes are drawn ( you ) are the only person that knows for sure how you voted? Contrary to anything you may have said in public.
For the record I ‘was’ a silent supporter of MARCOS in the 80’s! ( And look how well ‘that’ worked out? )
Maybe so but CM may be left leaning but he’s no liberal. My brother Keith Olbermann is undoubtedly a bonafide liberal. Matthews? Rigggggght.
exeter,
My point was that ( and I’ve been watching MSNBC a lot lately just to see how ‘they’ are covering the Gulf Spill ) is that for ‘me’, at the time, I basically HAD to support Marcos!
Where the Navy was concerned, he was a “law & order” guy, more importantly ( he was ‘our’ guy! ) The Base Agreement was totally contingent on the ‘agreement’ we had with ‘the government’ ( read him )
It’s not like the local G.I’s were oblivious to his oppressive tactics? We knew. But the very instant he got the boot.., it was o.k to come out of the closet! I can’t explain, I’ll never be able to explain just how euphoric that was. So Chris gets a tingle from time to time?
exeter, just reduce your belly a bit is all we are saying.
Speaking of clowns……
“Nothing specific at all was said.”
That sums up his whole presidential campaign.
On a side note, I used to enjoy Olbermann when he was paired up with Dan Patrick on ESPN many years ago. Who could of known then that he was such a left wing idiot?
i thought he sucked then too.
he did suck then as well
At least he had the nards to stand up to Bush & Cheeny in a open forum…
For what it is worth, at least Dick & Bush were willing to do it in an open forum.
Obama likes staged events with strap on questions.
Yea he was so brave. Why is it lefties are brave forbeing lefties?he is a letfard who likes to scream a lot. Nothing brave about it. And the only guests he ever has are fellow lefties.
Just exactly where are these nards of his? He sits in a studio and talks smack about men who are at war. That isnot nards. That is pathetically wimpy.
Just exactly where are these nards of his ??
Well, I suppose they are between his legs…Unlike, the two lap bitches Rush & Beck who licked the nards of Bush & Dick…
As opposed to a right wing intellectual like Glen Beck, or Rush or well just about any of them.
My take on last night’s speech:
To be honest, I was expecting a home run. You know, like Kennedy’s “put a man on the moon by the end of this decade” speech back in ‘62.
What I heard sounded more like a bloop single. And he barely beat out the throw to first. (Did I mention that my paternal grandfather was a baseball writer?)
What really caught my interest were the photos on the table behind the President. Some really good composition and use of color in them. (Ummm, memo to the speech stylists: Get the photos out of the background. I know they mean a lot to the President, but they’re a distraction to the TV audience.)
The post-speech Q&A with Robert Gibbs was even more of a letdown. What this country needs is something like Question Time in the British House of Commons. It’s as if the Prime Minister is dodging fastballs from every direction. Those MPs really know how to throw.
Another thing that didn’t happen. Obama didn’t have an open press conference to answer questions from the public OR a pre-screened press core.
This thing became an alternate energy speech, which makes no sense.
This thing became an alternate energy speech, which makes no sense ??????????????????????????????
Isn’t it oil that spilling into the gulf????
Isn’t it oil that’s financing militant islam????????? Hamas, Iran’s nuclear bomb, etc etc.
Alternative energy stuff is focused on wind/geothermal/fusion exc. Has nothing to do with energy used for transportation.
We don’t have a good mobile source yet.
We are getting closer.
So, if you wanted to knock down use of oil you’d go after mass transit projects that could work off our electrical grid structure. That and beef up power stations to handle extra loads.
No AE future plans that are still in research stage.
You should be writing the speaches. I’d join up.
It was the canned speech that politicians give, when they realize that all the hissy-fits they are throwing aren’t going to help matters any, and they fundamentally don’t have any control over the situation whatsoever.
We’re “doing all we can”……”someone is gonna get theirs”….”we’re here to help”……
Alternative energy stuff is focused on wind/geothermal/fusion exc. Has nothing to do with energy used for transportation.
We don’t have a good mobile source yet.
I drive an electric car for all of my around town driving. Costs a fraction of gas powered car, oil is heavily subsidized take away those subsidies and electric cars look even more attractive.
Biofuels is certainly part of the alternative energy mix as well.
While there might be a technologically viable solution in the future it is probably at least 15 years out. 10yrs research +5 years to productize.
In the meantime we could expand light rail in Los Angeles, OC, Ventura and San Diego. Be on line within three years (or less) and save huge amounts of oil.
I am POSITIVE we could do similar things with some high speed rail solutions for much of the North/South travel in the USA. Seattle to San Diego stuff. Get a lot of that on line in five years or less. Eliminate some of the air travel use of fuel. It’s small but anything that helps.
Plus you could have some tax breaks designed around purchasing fuel efficient commuter vehicles, incentives for businesses that move into designated clusters, larger tax breaks for people to move in from outlying areas.
That on top of your workfare program and another gas tax.
Not against strong government research into AE. Just saying we can move forward now.
Further special tax breaks for purchase of cars that are lower consumption would increase turn over rate and keep a lot of the guzzlers in the garage. I know incentives are dangerous but we ought to look things over.
Another initiative would be, and I’m not totally sure this would help, is to convert houses from oil heat to natural gas. Substantial amount of oil is used in home heating.
The potential for getting people into more fuel efficient cars and saving a lot of consumption in the future is quite high.
The bad part with any of my foolish schemes is that decreased consumption of oil along with cheaper efficient cars will get you beat with the GDP stick.
Well put.
(Yawn)…Barry gave a speech?
So THAT’S why NCIS didn’t come on until 8:20.
LA. City to Hand Out 278 Pink Slips.
Los Angeles - The city will hand out pink slips on Wednesday to 278 employees, mostly library staff and childcare workers — even as negotiations continue on Tuesday with union leaders for concessions aimed at canceling the layoffs.
Wombats, FYI - (you posted some CPS stuff recently) yesterday the board of CPS unanimously voted sweeping powers to school board president Ron Huberman. Hubie now has the power to increase class sizes, fire tenured teachers, and take out loans to keep the place running.
Oh man is this going to get good. If the Feds don’t step up with some more sugar/stash money soon this thing could come to a head soon.
Just another little chapter in the unfolding state/muni saga - quite possibly coming to a taxing body near you. Carrying costs people, don’t forget those carrying costs!
“Carrying costs people, don’t forget those carrying costs!”
That is one of the primary wildcards out there. Any tax conduit you are tethered to will be getting a complimentary size upgrade from the government.
tax conduit you are tethered to will be getting a complimentary size upgrade from the government
You can bet on it…A gentleman that I know that is building a apartment building was charged $4,000. per unit just for a park fee…
I was proud of my husband’s teachers union yesterday here in Sacramento. They voted themselves pay decreases, monthly payroll contributions to retiree health insurance, and a longer time to vesting. This will prevent layoffs of younger teachers. I have always thought that teachers were more sensible and less selfish than other state workers. And they’re paid far less than prison guards, police and nurses. Now if we can just get them to say yes to merit pay . . . . .
Do you have a link for this???
Wombats, FYI - (you posted some CPS stuff recently) yesterday the board of CPS unanimously voted sweeping powers to school board president Ron Huberman. Hubie now has the power to increase class sizes, fire tenured teachers, and take out loans to keep the place running.
The CPS seems to be approaching meltdown. And the people I know within the system say morale is extremely low.
A friend of mine teaches at one of the top-ranked public high schools schools in the city. Last week he told me that 25% of the teachers at his school will be laid off. A 25% reduction at a “poster school”! I was astonished by that.
He also said that rules of the game had changed for laid off CPS teachers. In the past, there was apparently a “reassignment pool,” a sort of holding tank for the teachers. If the teacher found a new CPS position they moved out of the pool, but they received a full year’s salary while they were in the pool whether they were working or not. My friend said the reassignment pool is completely gone — if you’re laid off, you’re laid off, just like the private sector.
“if you’re laid off, you’re laid off, just like the private sector”
Yeah man, reality is like a b!tch man..
Sorry but just shuffling around pub. employees ( where hopefully they won’t be noticed ) won’t get it done in the New Normal. I hate to see teachers get let go, but we might as well get used to lots more of it.
On the bright side I woke up this morning and the world hadn’t begun counter-rotating?
“Los Angeles - The city will hand out pink slips on Wednesday to 278 employees, mostly library staff and childcare workers…”
Is LA in the childcare business?
“Is LA in the childcare business?”
It’s in the child production business.
Maybe childcare for employees - ?
I would assume that part of their budget is the Head Start Pre-School program, which the Feds fund the majority of. L.A. is the epicenter of the illegal invasion, and their birth rate is in the stratosphere.
Congress directed the Fed to implement the new credit card protections in legislation signed into law by President Obama last year. Why? How can it be justified? Nobody held a gun to a person’s head to force them to get a CC! Pretty soon the con in jail will have more rights than us on the outside.
“Pretty soon the con in jail will have more rights than us on the outside.”
Yeeeup! Purdy Soon!
Trade places with them if jailbirds have it so good.
waiting………
The level of gov’t micromanagement in both the economy and personal affairs nowadays is mindboggling.
personal affairs nowadays is mindboggling ??
And this, bothers me the most…
I don’t know, salinasron. Banks have gotten so sleazy that I think they need to be reined in. For instance, I have always checked my monthly statement carefully for errors, and have never had problems until the last year. Twice my bank slipped in $25 overdraft fees even though my balance is never less than $3000. Both times I called and they apologized for their error after making me wait on hold for ten minutes. Crooked fees are the only reason that big banks are profitable despite having to write down billions in losses. Shareholders have no sway. You can’t not have a bank account. Only the government can control them.
Well the changes are a mixed bag IMHO. I certainly agree with the changes ensuring that you have sufficient time to actually pay the bill before they start calling you delinquint and charging you interest. But the seeming prohibition on raising the interest that they charge you on an existing balance flies in the face of the very basic principle of what revolving credit IS. It is a new loan, ever month, not an installment plan.
Jim A,
Expand on that a little, and I’m sure you meant ‘every’ month. I agree, especially once your -existing- bal. hasn’t had any NEW charges placed on it in months!
Yes, I did mean every month. And every month you have a choice to pay them the money you’ve borrowd from them, both last month and previous months, or to take a 1 month loan from them at the interest rate they offer. Before the change in the law, they simply weren’t offering multi-month loans at fixed rates. Revolving credit is really a brand-new loan every month, not just on what you’ve charged this month, but on ALL the money that you owe the lender. The CC issuers really perfected not just giving borrowers enough rope to hang themselves, but giving them JUST enough that they could dance on their tippy toes for a long time, instead of simply breaking their necks and declaring bankruptcy quickly.
Jim A,
Thanks for bringing that to light. It’s been a looong time since I carried anything resembling a bal. and daughter #1 had some pointed questions about how her statement and acct. actually worked.
( Kind of like when your kids ask for help w/ geography? )
Don’t bank with the big banks
Find a credit union or local bank.
Sorry, but they’re no better than the big boys. You still have to watch them like a shoplifter.
Banks have gotten so sleazy ??
I am done with them…I have moved to credit unions….
“find a credit union or local bank”
Guys, I’d love to sign off on that, but out ‘local’ bank was as sleazy ( and then some ) as any of the EMB’s. Rubber stamp builder loans ( to buddies ) “dividends” paid out in shares ( cuzz’ we’re smart and don’t want to create any taxable events! )
Totally failed to disclose the true nature of their mismanagement RIGHT up until FDIC shut.them.down!
Credit unions otoh have been ransacked by banking types “showing them how “it’s ‘really’ done!” Sorry, I’m not vouching for anyone, and there’s no simple answers. Start your own..?
Yeah our community banks up up to their eyeballs in CRE and crapshack developments. Everyone was drinking the Koolade.
In Montana,
Oh… I imagine the KA was just as strong by you as anywhere? How is Tim Blixseth these days? Or his lovely wife Edna?
Let’s call all the folks out in Bend and see how “doing business local” is working out? Our local failure ( by the time it was said and done ) was lending to builders in Ashland, the Coast AND Bend!
Of course, all the while being “just a small town bank”.
You can’t live without a credit card in today’s society. And the banks are always changing the rules in their favor.
So yes, a gun was held to their head.
Do you hold in high regard anyone who changes the rules in the middle of the game? Of course not. Then why should the banks be allowed to do so?
“You can’t live without a credit card in today’s society”
Can! ( Ask around, especially this crowd )
No I get your point, and for younger couples it’s practically a necessity. And they ‘do’ change the rules on the slightest whim.
Where our local f@ckups are concerned, they most certainly did change the rules mid-stream. Here you have all these sr. citizens thinking they’ve invested in this ‘conservatively mgd. bank’ and what they ‘really’ were doing was funding speculation for the profit of the board & directors! Contrary to popular opinion ( you don’t have to be EMB to create bagholders? )
Sure you can, if you don’t mind being a second class citizen.
But you aren’t going to be able to get any quick loans for any emergencies that pop up. And just who’s life is emergency free?
And bad or lame credit also affects your job prospects. You do know that credit checks are now SOP for most jobs, don’t you.
All utility companies require large deposit if you don’t have good credit.
Rent a car? Shop on line? Buy a necessary large ticket item? Unless you have a large amount of cash in your checking account to cover your debit card, you aren’t doing any of those. And most rental places require 2 credit cards.
So yes, you CAN live without a credit card, but unless you are wealthy, you WILL be living as second class citizen.
I’d agree that a credit card is practically a necessity for the things you just mentioned, but what do they have to do with living within one’s means? Is someone holding a gun to people’s heads to force them to go out and buy flat screen TV’s?
Most people would love to live within their means. Unfortunately they have no control over layoffs, wage cuts, price increases, illnesses, etc.
You can’t live without a credit card in today’s society
yes you can. Use a visa check card linked to your bank account. No balances, fees (other than overdraft, which is a problem with banking across the board)…
See above.
I have an idea, why not just raise taxes &”fees”
Taxable sales plummet in California, Sacramento region.
Sacramento Business Journal
Tight-fisted consumers continued to land a one-two punch in second-quarter 2009, with taxable sales declining 19 percent compared to a year earlier — the eighth-consecutive quarterly drop, according to the state Board of Equalization.
The Golden State’s second-quarter 2009 taxable sales were tarnished, falling to $113.4 billion, $26.6 billion lower than second-quarter 2008.
The decline “mirrored the national recession with weak retail sales,” Board of Equalization chairwoman Betty Yee said in a news release. “Californians continued to be concerned about jobs and housing costs while tightening their consumer spending.”
The City of Sacramento doesn’t care; they’re busy boycotting Arizona.
This story is so last year
Concerned about jobs and housing costs?
Jobs: All went to foreigners. There is a solution to this.
Housing Costs: Because of bubble. There is an easy solution to this too.
“Tight fisted?”
Why, you would think that 12% of the population who is unemployed are just downright scrooges, wouldn’t ya?
Man, I am getting sick of this shi, stuff.
Program could give homeowners up to 18 month mortgage reprieve
By Kimberly Miller Palm Beach Post Staff Writer
Posted: 10:21 p.m. Tuesday, June 15, 2010
Florida’s struggling homeowners could get an 18-month reprieve on mortgage payments under a state plan to spend $418 million in federal foreclosure prevention aid.
Palm Beach County would receive $28.9 million from the proposal, which was discussed last week during a meeting of the Florida Housing Finance Corporation and still requires approval by the corporation’s board of directors and federal officials.
Martin and St. Lucie counties would receive $1 million and $11 million, respectively.
The money is part of $1.5 billion the Obama administration announced in February for five states hardest hit by the real estate crash and unemployment. Other states sharing the $1.5 billion are Nevada, California, Arizona and Michigan.
Florida’s plan, which has three components including the mortgage reprieve, is expected to begin by early fall and help about 40,000 homeowners.
“I don’t think it will help everyone, but it will make a dent,” said Stan Fitterman, chief operating officer of the Florida Housing Coalition. “We’ve never encountered a housing situation like this before, so something like this has never been tried.”
The Florida Housing Finance Corporation created the proposal. Its three parts include:
•$353 million to pay up to nine months of a struggling homeowners’ mortgage if the lender or bank agrees to forgive up to nine months of payments. This is meant to help an unemployed or underemployed homeowner.
•$40 million in down payment assistance to eligible home buyers using Florida Housing’s First Time Homebuyers Program.
•$25 million to pay for legal counsel for homeowners who are in foreclosure but hope to keep their homes through mediation or loan modification or avoid foreclosure with a short sale.
How are they going to define “underemployed”? I mean, I’ve been underemployed my whole life and should have been making six figures since high school!
Seriously though, that’s a laff! They want to simultaneously want to “help” FBs whilst creating even more FBs.
I thought you said “stick figures”.
How is sucking new “first time buyers” into mortgages helping to avoid foreclosures?
Gotta make the new buyers overpay so the current owners don’t walk. Gotta spend tax dollars to do it. grumble grumble grumble… /sarcasm.
Don’t worry, by the time the money filters through the “diversity coordinators”, “urban development jobs boards”, etc., Joe FB might get 2 cents on the dollar.
Once a government pet, BP now a capitalist tool.
Washington Examiner
As BP’s Deepwater Horizon oil rig was sinking on April 22, Sen. John Kerry, D-Mass., was on the phone with allies in his push for climate legislation, telling them he would soon roll out the Senate climate bill with the support of the utility industry and three oil companies — including BP, according to the Washington Post.
Kerry never got to have his photo op with BP chief executive Tony Hayward and other regulation-friendly corporate chieftains. Within days, Republican co-sponsor Lindsey Graham, R-S.C., repudiated the bill following a spat about immigration, and Democrats went back to the drawing board.
But the Kerry-BP alliance for an energy bill that included a cap-and-trade scheme for greenhouse gases pokes a hole in a favorite claim of President Obama and his allies in the media — that BP’s lobbyists have fought fiercely to be left alone. Lobbying records show that BP is no free-market crusader, but instead a close friend of big government whenever it serves the company’s bottom line.
It is a good popcorn thriller…
1. BP donates most of its campaign donations to obama and to the democrats.
2. BP was all good with cap and trade (I assume they get a sweet-heart deal out of it) and publically support it and the dems who support it.
3. Now BP is being eaten alive by these same dems and will most likely declare bankruptcy (at least their North American Operations). Obama will likely kick them out of any drilling in the USA and BP will likely never pay anywhere near the billions in claims.
4. Other oil companies see this treatment of BP and decide the risks of drilling in North America are not worth it and leave for greener pastures (ie – one oil spill and your company is done). They will take thousands of high paying jobs with them and billions in taxes.
5. By the end of the obama administration - we will import more foreign oil than ever (so much for green energy). And have wrecked and polluted beached to show for it.
6. Rule of Law? No jobs? No energy? Socialism and socialist do not care…
Regarding point number four, it seems the so-called greener pastures want to stay green:
http://asianenergy.blogspot.com/2010/06/bulgaria-to-scrap-oil-pipeline-with.html
Normally, you and I agree, 2ban, but this “one oil spill and your company is done” is off the mark. 11 workers were murdered, as a result of BP’s casual attitude toward proper procedure. This was not an “accident”. The short cuts were deliberate.
I don’t think it is too much to ask that citizens and corporations co-exist in a mutually beneficial environment. But many multi-nationals don’t believe in that, hence, regulation and penalties. BP drew first blood in the Gulf.
Just seize the assets before they BK.
Yeah…What’s the problem with 11 dead and a tiny oil spill amongst friends right…
scdave, I wish I could find the link, but I read a story on line about Chinese-run mining operations in Africa. The workers are paid very little, and work in incredibly inhumane conditions. Illness, injury and death are not uncommon and the Chinese overseers are notorious for their cruelty. And yet, when a group of activists went to one mining area to try to investigate and help, the workers themselves went after the activists. They wanted those jobs.
The same attitude would appear to be prevailing in the Gulf in some areas. Murder us, take away our shores, our fishing, befoul our water, but PLEASE don’t take away those oil drilling jobs.
Yeah Palmy…They are scared for their jobs and I guess I can understand that…
Oil field jobs are the last truly well paying blue collar jobs.
A rig worker with a few years experience and a good track record can make 50K+ a year, easy. One with 5+ years and a good track record can make 70K+. And it just keeps going up from there.
There are many millionaires in the oil business who started, literally, at the bottom. That’s the kind of opportunity that has gone away in most businesses to day.
And whatever your position on green energy and the like, fact of the matter is, by closing off everything in the U.S. to drilling only means it’s going to get offset in countries that could give a crap about the environment or working conditions. No different than the steel industry or any other industry in that regard, except of course that you have to drill where there’s actually oil.
I’m not advocating no regulation by any means but we also can’t pretend, in the name of protecting the environment, that by banning drilling everywhere in the U.S. doesn’t create problems elsewhere.
Speaking of the steel industry….
I was just out of high school when the steel industry collapsed in this country.
It wasn’t the unions or regulations that were the cause, but the fact that the steel companies refused to upgrade their processes and equipment (most especially the new arc furnaces) and where getting the crap kicked out them by the foreign companies that were, along with price dumping.
James nailed it above. Companies usually start having trouble about the time some weasel exec starts cutting corners and ends up costing the company more in liability claims than was saved. But the first thing they do is blame J6P.
Every. Single. Time.
Just seize the assets before they BK.
Like I said.
Rule of Law?
No rule of law –> 3rd world banana country that NO one or company wants to invest in.
You ever wonder why places like Haiti/Russia/Venezuela/Zimbabwe/etc. can’t feed itself or keep the lights on despite massive natural resources?
BP did wrong. It does not mean the President can just seize assets as he pleases.
“BP did wrong.”
Well, what’s your solution? The company’s going to BK, that’s for sure. And then of course the taxpayer, as usual, is stuck with the costs.
I’m sick of this too big to fail crap. And, I mean, please, you have BP submitting paperwork for Gulf drilling that’s lifted from Artic drilling applications. Where they talk about protecting walruses and such. It’s beyond contemptuous.
1. BK is the rule of law in America. It is an option any company or person can take (at least until now).
2. Without it - few to none would take a risk to start or keep a business. Who would want to risk all their hard work and assets if it all can be taken away without due process?
3. BK is not some fun game room party time.
As a guy who was left holding the $hitbag on about $15,000 (and screwed the rest of their employees, vendors, and clients out of about $500 million), I say “Boo-hoo” to all their “hard work and assets”.
I’m old fashioned, I’d like to see some of these a-holes do some “wandering in the wilderness” for a while.
The new paradigm is “If you don’t have to file bankruptcy 3-4 times, you aren’t pushing the envelope far enough…”
Wow 2banana quite a rant
BP donates most of its campaign donations to obama and to the democrats.
http://www.cbsnews.com/8301-503544_162-20004240-503544.html
During the 2008 campaign cycle, according to the Center for Responsive Politics, individuals and political action committees (PACs) associated with oil-giant BP contributed about $500,000 to federal candidates. About 40 percent went to Democrats.
http://www.cnn.com/2010/POLITICS/05/05/bp.lobbying/index.html
BP employees gave more than $3 million in campaign contributions during the past decade and almost $110,000 in 2010.
Fifty-seven percent of BP’s contributions went to Republicans, while 43 percent went to Democrats.
“Obama biggest recipient of BP cash
http://www.politico.com/news/stories/0510/36783.html
BP and its employees have given more than $3.5 million to federal candidates over the past 20 years, with the largest chunk of their money going to Obama, according to the Center for Responsive Politics. Donations come from a mix of employees and the company’s political action committees — $2.89 million flowed to campaigns from BP-related PACs and about $638,000 came from individuals.
On top of that, the oil giant has spent millions each year on lobbying — including $15.9 million last year alone — as it has tried to influence energy policy.
During his time in the Senate and while running for president, Obama received a total of $77,051 from the oil giant and is the top recipient of BP PAC and individual money over the past 20 years, according to financial disclosure records.
Here are some other articles:
“U.S. exempted BP’s Gulf of Mexico drilling from environmental impact study”
“Obama admin exempted BP’s Gulf drilling from environmental impact study ”
“Obama sheltered BP’s Deepwater Horizon rig from regulatory requirement”
“Red Flags Were Ignored Aboard Doomed Rig ”
“US allowed drilling ‘without required permits”
“U.S. Said to Allow Drilling Without Needed Permits
The federal Minerals Management Service gave permission to BP to drill in the Gulf of Mexico without first getting required permits “
Your statement was
“BP donates most of its campaign donations to obama AND to the democrats”
BP donated 71k to Obama, I imagine many big companies donated to what they saw as the winning side. Why would anyone donate to a team with Palin???
The top congressional recipients of BP campaign cash include Republican Rep. Don Young of the oil-intensive Alaska delegation, who has received almost as much as Obama, raking in $73,300 during his congressional tenure. Also on the list is Sen. George Voinovich (R-Ohio), whose state has a BP refinery in Toledo and who has raked in $41,400. Sen. John McCain (R-Ariz.) has received $44,899.
Hardly a story of one sided political influence.
Again you suggest both that Obama is bought and paid for and that he is going to crush BP and run them out of town and destroy drilling and jobs in the Gulf. Which is it??
So much talk about who got the most “influence money” from whom. No indignation that the crime is allowed at all.
Nevermind the thoughtless nattering of the angry rightwing. They’ve never made sense nor will they ever.
So much talk about who got the most “influence money” from whom. No indignation that the crime is allowed at all.
An excellent point.
2. BP was all good with cap and trade (I assume they get a sweet-heart deal out of it) and publically support it and the dems who support it.
???? You know what they say about assuming.
3. Now BP is being eaten alive by these same dems and will most likely declare bankruptcy (at least their North American Operations). Obama will likely kick them out of any drilling in the USA and BP will likely never pay anywhere near the billions in claims.
So first your complaint was that Dems were bought and paid for and now it’s that BP is being eaten alive by them?? Specifically how have they been eaten alive???? Do you think the average Gulf Coast resident wants kid gloves applied to BP???
4. Other oil companies see this treatment of BP and decide the risks of drilling in North America are not worth it and leave for greener pastures (ie – one oil spill and your company is done). They will take thousands of high paying jobs with them and billions in taxes.
???? What greener pastures??? trust me they aren’t drilling a mile below the surface because there are greener pastures. My guess is that the other oil majors see this as an opportunity to buy up BP assetts. I’ll wager that we keep drilling in the Gulf.
5. By the end of the obama administration - we will import more foreign oil than ever (so much for green energy). And have wrecked and polluted beached to show for it.
This would be true of any administration because, The US is running out of oil. Even with the Gulf and offshore drilling. Another conflict banana, if we run oil companies out of the Gulf how will this cause wrecked and polluted beaches??? You are very conflicted.
6. Rule of Law? No jobs? No energy? Socialism and socialist do not care
What law has Obama broken so far??, No jobs is due to collapsing credit bubble and the systematic destruction of our manufacturing capabillities, which started a long time ago.
I’ll let you get back to your hooch.
PS if you want to join me later for bashing Obama Dems and well our entire gov on Wall Street and the FED I’lll probably join in, just let me drink a few and catch up.
Foreclosure case dismissed after judge finds he’s been misled by alleged lender
by Kim Miller
A foreclosure case against a St. Johns County couple was dismissed last week following confusion and possible deliberate “fraud upon the court” concerning the actual owner of the promissory note.
Foreclosurehamlet.org highlighted the case on its Web site and it appears to follow a judicial trend where judges are paying closer attention to who actually owns the note and whether the entity even has a right to foreclose.
A new Florida Supreme Court rule requires lenders to determine note ownership before filing for foreclosure, something that obviously didn’t happen in the case of M&T Bank vs. Lisa D. Smith, et. al.
According to the June 10 ruling in St. Johns, the plaintiff originally said the note was lost, then claimed the note was found, then claimed it owned the note by virtue of an assignment. But a foreclosure action cannot be based on an assignment that didn’t even exist at the time the initial foreclosure was filed in February 2009.
The lender then claimed it was the servicer of the loan and that Wells Fargo owned the note, but a stamp on the amended documentation was from the First National Bank of Nevada, which closed in 2008 and therefore couldn’t have been added after the 2009 filing.
It’s all very confusing, but in the end, Circuit Court Judge Michael Traynor says the court “has been misled by the plaintiff from the beginning.”
Traynor’s requesting an evidentiary hearing to find out if the attorneys for the plaintiff knowingly lied to the court and determine how an amended version of the note changed from “blank to specific, why the assignment appeared and then disappeared, and whether sanctions should be imposed against the plaintiff.”
You know how every now and then they find someone who’s been dead in their house for 10 years or so? I’ll bet that a handful of these sliced and diced mortgages somehow slip through the cracks in a similar way and that some lucky douchebags will get to live in their place for free for 20 years.
I think you’re right, and at some point “possession is 9/10 of the law” will kick in. Maybe it’ll be sort of like a car with a salvage title. A pain to sell, but easy to just hang onto forever.
US mortgage demand jumps after tax credit payback.
NEW YORK June 16 (Reuters) - U.S. mortgage demand jumped to a five-month peak last week, with applications to buy homes up from 13-year lows set in the wake of buyer tax credits while refinance loans hit the highest level since May 2009.
Mortgage purchase applications rose 7.3 percent after sinking five weeks in payback for steamy demand before the April 30 deadline for $8,000 in tax credits, the Mortgage Bankers Association said on Wednesday.
Borrowing costs hovering near record lows sparked a rush last week to cut costs on existing loans, driving the refinance applications index up 21.1 percent to the highest level in 13 months.
Don’t worry gang, it’s just refinancing. My mortgage lender offered me a no fees at all refinance to lower my interest rate from 4.625 to 4.35%. It will save us a few hundred dollars per year. All I had to do was send in two paystubs and the W2. I will continue to make the same monthly payment and will finish paying the mortgage in 4 years. Why are they offering this? They can sell the mortgage and collect fees/commissions.
“My mortgage lender offered me a no fees at all refinance to lower my interest rate from 4.625 to 4.35%.”
REhobbyist, could you disclose your mortgage lender, if you don’t mind? I’d like to give them a call as I’m paying 5.75% and Wells Fargo wants $3K-$5K to refi into something similar. Thanks!
Wells Fargo (in Sacramento.)
REhobbyist-
Where is the property located? I believe other posters here have said that an acquisition financing mortgage in California is a non-recourse loan, but refinanced loans are recourse (that is, they have your personal guarantee).
The skeptic in me is wondering if something like this is the motivation behind their “generous” offer.
Likely in Sacramento, Ca…
They can get more for the mortgage if it has a higher rate. Are you sure there aren’t any other terms in this re-fi of which you’re not aware?
Oh yeah, now I remember the catch. It’s what Ol’Bubba just said. They are converting you from nonrecourse to recourse. Should be OK if you’re sure you will never be foreclosed.
That is true - refinanced even without cash out converts to recourse. Interestingly, California is in the process of passing a law to permit non-cash-out first loan refinances to remain non-recourse loans. If it passes it will to into effect in 2011.
California is in the process of passing a law ??
Yep…Moral hazard on top of all the others…Disgusting…
China Property Bubble to Burst ‘Quickly,’ Nomura Says.
June 16 (Bloomberg) — The “bubble” in China’s property market is going to burst very quickly, with prices set to fall as much as 20 percent in the next 12 to 18 months, according to Nomura Holdings Inc.
National real-estate prices may drop between 10 percent and 20 percent on average, compared with an increase of about 22 percent last year, Sun Mingchun, a Hong Kong-based economist at Nomura, said in a Bloomberg Television interview.
“If you look at housing prices to disposable income in Beijing and Shanghai, they are 13, 14 times,” said Sun, whose team was ranked third in Institutional Investor’s 2010 Asian poll for China research. “There’s no way you can say there’s no bubble.
I can’t believe no one has posted this yet.
http://www.washingtonpost.com/wp-dyn/content/article/2010/06/16/AR2010061601719.html
Fannie Mae, Freddie Mac to delist shares from NYSE
The Associated Press
Wednesday, June 16, 2010; 9:25 AM
NEW YORK — Government-sponsored mortgage purchasers Fannie Mae and Freddie Mac plan to delist their shares from the New York Stock Exchange.
The companies’ regulator, the Federal Housing Finance Agency, said Wednesday that it expects Fannie Mae and Freddie Mac shares to trade on the Over-the-Counter Bulletin Board, an electronic quotation service.
The move to delist the shares isn’t a surprise. The crash in the housing market has pounded Fannie Mae and Freddie Mac with heavy loan losses since 2007. Fannie shares have been below the $1 average price level for 30 trading days. NYSE rules require a company to take action to boost its shares or delist.
That took forever! Technically, they should have delisted years ago, when they stopped producing financials. We used to regularly post on this topic here, but it was literally years ago…
I was surprised. I figured if they made it this far, there was a tacit agreement to leave them alone.
Now if we can just DISBAND them completely, all will be well. (Well, as long as we can take down the FHA as well.)
That’s awesome. They should have been delisted a long time ago. Some regulaory action years ago could have prevented much of what’s going on now. They initially didn’t want to delist them because they were “too big to delist”. Now look. Circumstances have led them do delist by force, accompanied by huge economic consequences.
The only downside, as I see it, is that they didn’t delist them before putting ownership into the hands of the U.S. taxpayer, who got to enjoy the big plunge in stock prices today. At any rate, whoever the former owners were certainly took the brunt of the share price declines (probably was ultimately mom and pop who took the hit, anyway, to the extent that pension funds were likely large shareholders in these companies).
June 16, 2010, 9:52 a.m. EDT
Fannie, Freddie to scrap NYSE stock listings
By Greg Morcroft , MarketWatch
NEW YORK (MarketWatch) - In another sign of the firms’ financial disintegration, Freddie Mac and Fannie Mae, the giant mortgage finance companies operating in government conservatorship, said Wednesday they are delisting their common and preferred stocks from the New York Stock Exchange.
Freddie (FRE 0.76, +0.02, +2.98%) said in a press release that, “this notice was made pursuant to a directive by the Federal Housing Finance Agency, Freddie Mac’s conservator, requiring Freddie Mac to delist its common and preferred securities from the NYSE.”
According to a press release by FHFA, the agency issued similar directives to both Freddie Mac and Fannie Mae (FNM 0.57, +0.01, +2.37%) .
…
Fannie and Freddie; taking the “D” out of the American Dream.
Ironic that the sectors of arguably the two main components of the American Dream™ (as envisaged by many), autos and houses, have been taken over by the American Government. And who says we don’t worship idols made of wood, stone, and metal?
Heh. The “American Ream”, brought to you courtesy of the FIRE sector , other monied special interests, and their bought-and-paid-for politicians.
* JUNE 16, 2010, 2:35 P.M. ET
Big ouch for GSE bottomfishers on that 40% share price plunge when they were delisted…
Delisting Of Fannie, Freddie Foreshadows Fundamental Change
By Prabha Natarajan
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)–Federal regulators’ decision Wednesday to remove shares of Fannie Mae (FNM) and Freddie Mac (FRE) from the New York Stock Exchange and have them trade on an electronic bulletin board marks a fundamental change for the two mortgage agencies now that they are operating under conservatorship.
The conservator, the Federal Housing Finance Agency, said the move was a result of both companies trading around $1 for more than 30 days.
“It’s a formality,” said Todd Abraham, a portfolio manager at Federal Investors Inc. “It’s surprising that it didn’t happen before.”
Freddie Mac’s shares haven’t closed below $1 since Aug. 7, 2009, though they have hovered around the $1 level, while Fannie’s have closed under $1 every day since May 19.
Freddie was recently down 40% at 73 cents, while Fannie traded 38% lower at 57 cents.
Other market participants, however, said they saw the move as a clear message, for anyone still in doubt, that Fannie and Freddie are government tools for fixing the housing market, no longer independent companies that can be traded for their worth.
“The delisting isn’t a signal of where [the government] wants to go with Fannie and Freddie as it is disabusing people of the idea that they are independent entities,” said Jim Vogel, agency strategist at FTN Financial.
The government took over the nominally independent mortgage finance companies at the height of the credit crisis in September 2008. Since then, while many plans for reform and restructuring have been discussed, there is no clear plan on how to get them out of government protection.
By withdrawing the shares from trading on the New York Stock Exchange, a process known as delisting, the government essentially rules out the option of the agencies resuming their former status as large, publicly traded companies, market participants said.
…
This was found on the Baltimore Craigslist. He makes an arguement that due to the oil spill the homes on the Chesapeake Bay will dramatically increase:
$1 WATERFRONT ON E.C.PRICES GOING UP/Oil Spill Related (Chesapeake Bay) (map)
Date: 2010-05-29, 11:52AM EDT
Reply to: hous-se3y9-1765448843@craigslist.org [Errors when replying to ads?]
As indications were given, prices for waterfront property, on or having direct access to the bay, are heading up.
As the spill in the gulf widens, estimates are that over 80% of the useable waterfront in the gulf will be un-inhabitable for decades to come. There by spawning a severe shortage of waterfront property on the entire east coast especially from the Chesapeake Bay down to the Carolina’s. While the facts are still not in, we can expect a huge increase in waterfront property value. During the bubble of 2003-2007 waterfront property took the largest increase in value. Estimates were that per year 30% increases were not unusual. Since the bubble broke, waterfront usually held its own or reduction in prices were minimal. By the year of 2009 fairly dramatic decreases were being felt even with waterfront. Homes that had sold in the $750,000 range were on the market for $550,000. Yet, if one were to go back as far as 1999, those same homes were selling for $250,000, hence the reduction was a normal and acceptable amount. Here today , the market is on the rise. Estimates again are placing those values back into the bubble range if not more.
Supply and demand are the normal driving force, and lacking supply increases demand. With gulf property litterally being driven down to junk value, folks know there are decades if not longer to wait for their return, and never back to normal conditions, they are looking to the East Coast.
Two things are driving them Eastward. One is the similarity of water conditions and fishery. Second is cultural events. Poles were taken back in 2001 as to where you would love to live. Choices were given as to waterfront, mountain, plains, rolling hills. Ninty six percent said their first choice would be waterfronts. Questions were then given regarding the reasons they refrain from waterfront purchase. First reason was prices, and second reason was flooding conditions and storms. In todays market, and especially for the east coast, those reasons are no longer an issue. Prices have dropped in the last three years, and flooding is much more controled, on the East Coast than any other waterfront region in the nation.
Basically, you might expect a three fold price increase on waterfront property on the Chesapeake Bay in the next five years. So either hold onto what you now have and wait for this bubble to happen or sell at reduced prices. Regardless on what you choose, and if you own waterfront, you cannot go wrong.
Threefold increase in property values in five years? that’s a pretty bold prediction for land near a fairly muggy and stinky body of water.
There are so many RE agents doing everything they can to prop up the market. “Waterfront property will increase threefold”, “This is (fill in a suburb of DC)…..we didn’t get hit with a bubble”, “The inventory is tight, not low…..buy a house before they are all gone”, “When putting in an offer for a foreclosed house, you don’t want to go below 10 percent of the asking price. You want to show the bank your serious about buying the house”.
Lather, rinse, repeat……always repeat!
The water in the Chesepeake Bay is opaque and contaminated. It is not recommended for swimming or much else.
We don’t NEED any stinkin’ oil to kill off the marine life in the bay. I don’t remember the number, how much of it is a low-oxygen “dead zone” again, 40%? Even crabs, which are basicly giant acquatic cockroaches are dying off.
Even crabs, which are basicly giant acquatic cockroaches are dying off.
Which gives new meaning to that t-shirt that says, “Maryland is for crabs.”
” Regardless on what you choose, and if you own waterfront, you cannot go wrong. ”
You betcha by golly. Drill Baby Drill.
nothing can go wrong…nothing can go…Ooops!
The oil in the water will make the coast “unihabitable for decades”? How? These houses are plumbed, right?
That is hilarious!
Baltimore was one of the case studies which led me to believe there were shenanigans in the massive real estate run up. Many were suggesting increased demand caused by an ever-growing population were causing higher prices. Baltimore had a massive run up, rowhomes near bad areas of town commanding 300K. But during 2000-2006, Baltimore had a net loss of population. A discontinuity in the narrative.
Even the best get burned!
We -finally- decided to stay in our rental another 3 years so jr. can go to the same middle school for the duration. The very -same- day we come to peace with that decision, we get a call from the landlord telling us they are bailing on their mortgage once our lease is up.
I used to half-joke/half-whine about squatting in foreclosures, and now I am in the position to do so myself. The FB landlord is in another state and broke, so they can’t/won’t try to evict us.
The taxes are paid for 2009 and not due until November so the state won’t evict us until the end of the year at the earliest.
Both loans are with the same Credit Union, seems the landlord had about 10% skin in the game. They may be the ones to chase us out sooner rather than later. We figure if we can last 3 months, that will 1) cover the move expense and 2) give us time to find another place. For the moment all the other foreclosure squatters are blocking us from our ideal neighborhood, and we hope something opens up eventually.
This morning over coffee, we toyed with the idea of approaching the Credit Union with a very, very low cash offer, or even offer to pay them rent. Tried to determine if we pay 1/3 of the mortgage payment each month, if that would delay the foreclosure some? There is already one home in foreclosure on our street, one empty in unknown status, and one for sale, so the house won’t fetch much on the open market.
We did our due diligence to the best of our ability two years ago before renting here, the taxes were all paid up, and we knew they had moved for a better job - so the house was safe at that point. But after the move one of them lost their job, and then the telltale signs of bill collections started happening. We had hoped that as long as we paid rent they would pay the mortgage, but they can’t anymore. They said they will give us referrals since we did a great job maintaining the place.
We already have the electricity and water and bug guy in our name, so those won’t get cut off. Just need to flip the trash collection and we”ll be set.
Not sure how long we’ll last or even if we’ll do it, but the dearth of good rentals out there kind of chooses our hand for us momentarily. Sorry for the ramble, have a lot going on in my head right now. Any suggestions welcome, and I’ll try to meet with Ben when he hits Tampa.
rusty,
I am so sorry to hear all of that. As I’ve said in the past many times, there will be no winners in all of this. Another Accidental LL Bites The Dust. ( Someone should write a song about that? )
Glad to hear that ( for the time being ) things ’seem’ to be working out. What I find sad is that ( and I don’t know your age ) but when you were younger did you ever say to yourself;
“When I grow up and have a family I hope there’s an horrific Housing Bust and we can semi-squat as a family! Of course they’ll be no hope of -ever- owning a home that will build equity ( let alone be paid off? ) But at least I can milk it for awhile?”
We’re all just making the ‘best’ of a terrible situation. I’ll assume ( w/ school age kids ) that you’re younger and would much prefer to see all of you building your homes, dreams and lives. IMHO.
we’re early forties with our son just starting 6th grade. We’ve seemed to have moved on average every 2 years, but time to settle down.
And you are right, that’s exactly what I wished for when I was younger, haha.
I have written to the LL to find out more info without tipping my hand. I’m pretty certain they will just walk away from the house and not even bother to get the stove/fridge/washer dryer. It would cost them more in gas/ticket to come get it.
If they ask nicely, we’ll sell it for them and give them the funds, but I won’t be too proactive in that regard.
I hope you stop paying rent immediately. Save your cash.
I’m guessing that your dear LL will still want his rent money even when he stops paying (it’s called rent skimming, ya know). And although he may not go after you for the money (after all, he is causing the place to become “uninhabitable” for you), I wonder if he’ll still give you a good referral once you refuse to pay him something that isn’t “rightfully” his.
Landlord said he’ll use the security deposit as last rent, so we won’t even send a check this month. We plan on changing the locks to avoid any nasty surprises (oops we lost our keys and had to redo)
I think the best money you could spend right now is to go talk with a lawyer. You may have other options, you may be able to stay there longer, you may owe debts thsat could follow you for years or you may wind up in jail.
Better to spend the $250 now.
2banana,
And of course his “LL” ( in ‘another’ state we’re told ) isn’t half as worried about this as our dear friend Rusty! Hell, they’re probably already joking about it? Oh well, out of sight, out of mind?
You provide sound advice, and not some “housing advocate” either? A ‘real’ lawyer. Again I’m just so saddened for these young people. “Hey mom, guess ‘what’? We’re getting a STEAL on our house! ( I’m so proud son! )”
“You may have other options, you may be able to stay there longer, you may owe debts thsat could follow you for years or you may wind up in jail.”
WTF??? There is zero chance of ending up in jail. You had a lease, right? So you can prove that you were legally entitled to take up residence.
There is no crime in not paying the rent if your LL gave you the green-light not to, and indicated that he/she would not pursue eviction.
There is also zero chance of owing “debts” to anyone. You’ll leave with no liability, other than paying the utilities that are in your name for the duration.
Your only risk is in having to move on relatively short noticed. But the opportunity to live rent-free for a while should compensate you pretty nicely for that.
Rusty, I know moving is a PITA, but I think you just won the housing bubble squatter lottery! I would expect that you can stay there rent-free for a LOT longer then a few months…
Our lease is paid in full - so no obvious debts.
Will probably talk to a lawyer, thanks for the tip.
Yeah the -very- short notice to move is a big downside.
Moving does suck, and in the middle of Florida summer, doubly so.
We are hoping that by the end of July some nice house opens up in South Tampa and we can move and not even think about it, but we won’t move to something a lot smaller, for more rent if we have a choice.
There will not be a “very short notice” to move. You will know it’s coming, and then you will get cash for keys (see below).
Rusty, look on the bright side. At least your landlord had the ethics to tell you that he stopped paying the mortgage. Recently another HBBer got evicted after months of paying rent to the LL who had stopped paying months before. Now you can live there for free for several months while you look for another place.
Why do you need to pay a lawyer?
I would wait to talk to the credit union for a month or two - why draw attention to yourself? And if you offer to buy it right away they’ll start thinking that the house is worth more than it is.
REhobbyist,
That is very true, many here were not even given that much courtesy. While I was blissfully renting the way ‘I’ found out my unit was being ( Hell, had -already- ! ) “sold” was by my neighbor realtor lady!
She said ( and I kid you not ) “There’s some smokin’ action going on by you!” As it turned out, all the other ‘bids’ were from realtors that all worked in the same office and were looking for low-dollar flips. So yes, it could’ve been infinitely worse.
Yeah glad he called, we have a great relationship other than them not being able to absorb the difference between rent and mortgage any longer.
They actually called because I was going to blow insulation into the attic at my expense and was just asking for their permission. We figured the savings over 3 years on the electric bill would cover the cost. He said don’t bother, since they were giving virtual jingle-mail. Could have knocked me over with a feather. Had an itchy feeling about it, but to hear it on the phone…
We have 6 weeks to do the ‘right’ thing, or as many weeks/months we can stretch this shadow inventory out. (at least until cooler weather, haha!) They live in Connecticut now, the bank is in Jacksonville, and the taxes are paid. Life goes on!
It’ll be funny if before this is over you wish you’d have gone ahead with the insulation anyway.
our bill went from 140 to 340 in a month , which is what prompted the insulation idea. First i was going to get scraps off of CL, but my neighbors told me about getting TECO to come do an inspection and the give me an installer at reduced rate. Saves me from driving all over town and getting into the steamy attic 20 different times.
We even have a July 6th appointment for the inspection. Will still go through with that, unless we find our next house right away by some miracle. Who knows , betting on a longtimeline in that case.
I tried calling a lawyer last year. He was pretty pissed off at me when I told him people sometimes stop paying when they realize the house is going to foreclosure. He told me I could get in real trouble for opening mail delivered to my place but addressed to my landlord and left the conversation telling me I’d better think long and hard about what type of trouble that could get me in. Hey, I just opened the mail. Don’t usually have to worry if its somene else’s!
So do ya think he’s a Syracuse slumlord?
SWEET! It will take a year before they get around to kicking you out, at which point they will offer you cash for keys. You’re rich, you’re rich, you’re RICH!!!
We sure hope it takes that long. I’ll have to stop whining about others doing the same thing
The folks in foreclosure across the street from us have been in their house since march last year, so 14 months or more. We saw them downsize the cars, that was the only outward indication of trouble. Well that and a garage sale.
Since last summer (and by that, I mean after the blown electrical fuse incident about which I’ve blogged y’all a river already), my next door neighbors have been having at least one yard sale a month.
I think they’re trying to pay off the electrician from last year, and the huge bill from their Tax Day 2010 water line blowout beneath my side yard.
they keep that up, the IRS will come knocking now with the new rules put in place.
The thing that made us even consider this move was the report of 1 to 5 million foreclosures in Florida alone. And with the tarballs only miles off the tampa beach… things are iffy around here!
rusty,
I hear ya’, and it sounds for the most part, all of these are things beyond your control. We’ve joked in the past about “checking your Landlord’s credit!” and I know you would stop the tarballs if you could?
Still, it doesn’t make for what one would describe as a “stable environment” for your wife or kids, and that isn’t good. No matter how much of an economic advantage that might provide short term ( or… longer? )
Yes but…Staying rent free probably IS fine except that as others have pointed out having to move at (relatively) short notice when the bank gets around to actuall foreclosing on your landlord. On the one hand, you might manage to live rent free for a year, judging by the speed with which foreclosures are happening now. On the other hand, there’s a good chance that when you DO have to move, it will be in the middle of a school year. It would probably pay to keep an eagle eye on available rentals in the same school district.
thanks for the advice, we have our fingers actively on the pulse of rentals around here, been eyeballing the market for months now. Worse case scenario the stuff goes into storage and we rent a trailer in thonotassa (white trash haven!).
The short time move window is a concern, but we don’t collect much junk and we still have all our move boxes - bet we could get it done with hired help in 2 days.
rusty, you’ll get WAY more notice than that! It’s a multi-step process, with required legal notices along the way. Eventually you should get something on the door giving you an exact time that the sheriff’s deputies will arrive; notification periods vary by jurisdiction, so consult with a local attorney about what you can expect in that regard.
But when I said “relatively short notice”, I meant a few months, not a matter of days!
Thanks, believe it or not, never even been -near- an active foreclosure until that phone call last night. We could still walk away july31 and be naive (never look back), but this may be a good learning experience!
Dude, Rusty:
You will not get evicted. Once the foreclosure has been done (in 6 months to a year, probably), your bank will send out a rep, who will get you to sign an agreement saying that you promise to move out within a certain time period, and to leave the house clean and in good condition. If you abide by your end of the bargain, then they will give you like a month’s rent in exchange for your cooperation.
They usually offer you the option of getting out in 15 days for like 2x rent; 30 days for 1x rent; or 45 days for 0.5x rent. If you keep a close watch on available rentals, you can quickly sign your new lease, accept the 15-day offer, and be OUTATHERE.
Just for the fun of it, you should rig the doorbell ala Ferris Bueller’s Day Off to play the sound of a 12 gauge shotgun being loaded when the sheriffs come a knockin’. Of course, you’ll be long gone. (For you hyper-sensitive types, just kidding of course).
Man if we can get 12 months out of this, it would SO be worth getting the attic insulated.
We have made many improvements in the house and we take pride in living clean. Our neighbors didn’t even know we rented until it came out in conversation one time. We have improved the floor, walls, garage, yard, pool deck, bathrooms. (basically the house had been abused for 3 years by the owners before they moved - he was NOT a handyman).
The people moving in after us get a better place than we got when we moved in that is for sure.
I have a friend that just left his foreclosed home this weekend. This was a guy who was grossing 14 Mil. through his business about ten years ago. Anyway, the lender gave him 10K to leave. So yes, the jingle mail payments are true.
Renting is so much better than buying.
it sure does have some upside. I did tell the wife that at abosolute worst case, our next rental is uncomfortably expensive for 12 months and we move again. But I don’t see that happening once foreclosures hit the market. We are cashed up and ready to buy, but not at 2003 prices. Can wait it out a bit longer.
Eddie,
Kind of been my point where that whole situation is concerned all along. Whether you do/don’t need an atty., whether you will/won’t be able to stay there “rent free”?
The bottom line is that -none- of that is sustainable! One way or the other, ‘it’ ( whatever it ‘is’ ) will come to an end! I won’t say paying 3 X for a comp. home is ‘worth’ the ownership premium, but I don’t think coming home from work finding your prized possessions on the front lawn is worth “free rent” either?
Maybe the bank will let us buy for 30% of original high
I now see why the LL is walking away, their original 80% ARM loan resets very soon. Their bath was about to get worse. They bought at absolute peak, our bragging right is we rent the ‘most expensive’ house on the street (lol)
Another guy down the street put up his house FSOB shortly after we arrived, and wanted 100k more than it was worth then, now he only rents it to 4 college kids.
Another guy down the street put up his house FSOB shortly after we arrived, and wanted 100k more than it was worth then, now he only rents it to 4 college kids.
And I’ll bet those kids are doing their very best to, ahem, depreciate the property.
So true. We see 6-8+ cars parked there all the time (brings back fond memories of college life).
Shame is, that house was gorgeous. They had totally upgraded the kitchen, bathrooms, carpet, flooring to top of the line stuff. Now I can only imagine how it looks in there, and getting worse.
He shouldn’t have been greedy and try to recoup his upgrades. He’ll be renting that place for a long, long time.
Is anyone besides me looking for a downward revision this time next month to the May hew home building number to the tune of 13,000 (= 593,000 - 580,000) or so?
Casual observation: Since the market intervention approach did not seem to be working, it looks as though Uncle Sam may have thrown in the towel on demand stimulus and has turned to fundamental end-user demand to signal when the housing bust is finished bottoming out. There should be no problem for bank balance sheets with this, so far as I am aware, as the toxic mortgages seem to have generally gravitated to the Fed or the government-owned-and-operated GSEs.
Economic Report
June 16, 2010, 8:43 a.m. EDT
U.S. home building craters after tax break expires
Single-family permits drop 10% to lowest in a year
By Rex Nutting , MarketWatch
WASHINGTON (MarketWatch) — As expected, U.S. home builders sharply reduced construction as a federal tax break for home buyers expired, according to estimates released Wednesday by the Commerce Department.
Housing starts fell 10% to a seasonally adjusted annual rate of 593,000 in May, the lowest level since December. The details were even worse, as starts of single-family homes plunged 17% to a seasonally adjusted rate of 468,000, the lowest in a year.
It was the largest percentage decline in single-family starts since 1991.
Housing starts were up 7.8% compared with May 2009, but are down more than 70% from the peak. Read the full report on the Census Bureau’s website.
The tax credit and low mortgage rates have helped revive home sales and construction from the worst downturn since World War II. But with the credit expiring, builders face tough competition from foreclosures of existing homes, and buyers remain cautious about the job market. In some areas, prices are still falling.
The report was worse than expected. Economists surveyed by MarketWatch were forecasting a 7% drop to 623,000. April’s starts were revised lower to a 659,000 rate from 672,000 previously estimated.
…
I don’t see why anyone cares about these small month to month fluctuations, and attribute them to public policy.
Housing starts are low, and will probably need to stay low for a very long time to work off excess inventory.
The question is, what effect will the withdrawl of the tax credit have on sales and prices. The goal was to borrow money that first time home buyers will have to pay back later, and give it to them now so they could transfer it to seniors and banks selling homes through higher prices.
“I don’t see why anyone cares about these small month to month fluctuations, and attribute them to public policy.”
Chalk it up to MSM-sponsored myopia.
The other thing is that getting the sheeple to focus on the negligible month-to-month variation in new home construction numbers helps distract them from the big picture realization that the U.S. home construction industry will remain in the toilet for the foreseeable post-bubble-collapse future.
I was thinking last night, with my little mind, and I thought something neat. I thought
That’s what I came up with, and I stick by it.
Big V, when has there ever been a direct correlation between how much someone makes and the amount of specialized knowledge it takes to run their business? I mean, one can be a geologist or some other ologist and not make jack-diddly, and on the other hand, one can be a crack dealer and pull down a lot. Life ain’t fair.
But geologists still make more $$ than construction workers. I think builders have to hire geologists too, but it’s mostly just construction. The barriers to entry into the business are not very high.
Crack dealing is different because it’s dangerous and can land you in jail.
Things are looking up! At least for one or two scumbags. Deciding that the taxes we pay for their social services weren’t enough, they broke into our house through our bedroom window and stole every last piece of jewelry my wife owned.
Wall street should throw them a parade for stimulating the economy! Window repair, jewelry replacement, security system upgrade, gas spent driving to all the local pawn shops, insurance premium hikes, safe installation… and that doesn’t count all crack/PS3 games/etc they’re going to buy with the couple grand they’ll probably get fencing it.
I know it goes against the economic recovery they are trying to enact, but I hope they get royally stiffed by whoever fences it for them.
FYI - spend some money on a good safe and BOLT it to the floor.
Most crack head burglars won’t spend the time to mess with it. The professionals won’t bother for such small gains.
And PS - have you thought if they come back since they know your house is an “easy” mark? While you or your wife is at home? Do you have a defensive plan
?
“Wall street should throw them a parade for stimulating the economy!”
At least they were entrepreneurial in their approach to stimulus; they did not rely on Uncle Sam to provide them with cashola like Megabank, Inc did…
How do you know they received social services?? Maybe this thief was fully employed during the day, and supplemented his income with breaking and entering.
A group of rich kids at my highschool got caught doing this stuff for spending cash. They all got probation and a slap on the wrist.
In the case of breaking and entering or mugging I’m for first offender jail time and repeat offender long mandatory jail time, and then 3 strikes and your out.
Surprisingly… that actually happened at our ’sister’ Guard Base. The guy was a respectable senior enlisted guy by day, and an out of control thief by night!
By the time they finally caught up w/ him, he had ahem ‘liberated’ hundreds of thousands of dollars in equipt. and electronics from the base!
So believe it or not, it can and ‘does’ happen. Guess… he won’t be getting that plush gov. pension any more? Oh and he sold all of it CL! In the end, it was his neighbors that turned him as they were only complaining that it was “like he was running a ‘garage sale’ 24/7!”
Stealing from the Military while on the paycheck puts it Military Court, doesn’t it?
sfbubblebuyer,
Yeah…. BUDDY! This guy is so screwed.., I can’t even talk about it. He’ll probably go to Leavenworth. For a long, loooong time.
And he was an E-8 too! ( Hell, there’s only 9 Enlisted ranks to begin with? ) And it’s not like the full-time guys don’t make decent money. At his pay-grade I’d say he was makin’ between 55-60k a year ( all ben’s taken into account )
I have a panic attack if leave the base w/ disposable ear plugs. Sheesh.
Yeah…. BUDDY! This guy is so screwed.., I can’t even talk about it. He’ll probably go to Leavenworth. For a long, loooong time.
And, when he gets there, he’ll find that when they’re talking about hard labor, they’re not kidding.
I got mugged and managed to get the license of the get away car. I had to walk six blocks to a donut shop to get the cops. (I’m not even kidding.)
They took my report and I never heard anything again. Probably a stolen car, but still, not even a call back for an update.
Needless to say, I don’t hold out much hope for the police catching or recovering any of this stuff.
I’m sorry, sfbubble. Getting burglarized is the pits. I’m glad you weren’t hurt.
My car was broken into a couple of days ago.
Stole my bag of hand tools, and a little cup of change I sit in a cupholder. Left my high-dollar sunglasses, and my three CD pouches (yeah, I haven’t succumbed to the MP3 yet).
Guess they didn’t like oldies (early 60s to the late 90s), Dwight Yoakum and the AfroCelts.
Latest news from Tucson:
Investigation continues in hitman-killing of the guy who was involved in a rent to own scam.
Backgrounder on the scam.
The victim was in a restaurant waiting for the start of a Christian businessmen’s meeting.
You can’t make this stuff up.
Well, sotto voce, that’s been my reaction too. But, as you’ve probably noticed from all of the stories I’ve posted here, the local fishwrap editors are not allowing comments on these stories.
I can’t imagine why.
Probably too much public support for the lynching of REIC criminals.
I said, I ordered a “take-out pizza”, not “take out Piazza!”
At least that would be my defense.
I have mixed feelings about this. Although I certainly don’t advocate vigilante killings, I can’t imagine the helplessness most victims of these types of scams must feel, especially in light of the impunity in most cases.
The only way to get to Pablo Escobar, Colombia’s notorious narco-terrorist responsible for the death of hundreds of innocents, was to strip him of his cadre of bankers and lawyers, extra-judicially, one at a time. They were usually found in a ditch with a sign around their neck. Granted, I’m not saying that these ponzi scams cause nearly the social fallout that Escobar did, but on the other hand, when this kind of thing happens, I’m not shedding any tears for them either.
Wow. I’d say he probably deserved it, but that’s just not a very christian, thought, now is it?
Well, by way of more backgrounder, I used the mortgage company that was mentioned in the “backgrounder” link up above.
They were the loan originator on the Arizona Slim Ranch. Horrible outfit. Highly not recommended.
Any-hoo, after the scam indictments were announced last year, I wrote a letter to the head of the Arizona Attorney General’s Tucson office. Here’s the text of the letter:
Enclosed please find a printout of an article that I wrote for Freelance Switch.
While I didn’t name the company in the article, it was Tucson Mortgage. And you may be wondering why things went so badly wrong after my initially positive experience with this company.
I can’t help but thinking that my problems were due to my insistence on a fixed-rate mortgage, rather than an ARM. In my initial interview with a Tucson Mortgage employee, he urged me to consider an ARM, because, as he said, it would lower my monthly payment. I countered by saying that interest rates were going up, and, in 2004, that is what they were doing.
Furthermore, I couldn’t understand why I was being given the ARM sales pitch. After all, I had good enough credit to qualify for a fixed-rate mortgage, so why couldn’t we have just spoken about that? Well, as we know now, ARM sales commissions were higher than those paid for fixed-rate mortgages. And we also know that many homeowners were steered toward ARMs, even when they could have qualified for prime-rate loans.
Perhaps your investigation could be expanded to include Tucson Mortgages sales of ARMs to homebuyers who shouldn’t have put into them. Fortunately, I am not one of them.
Respectfully submitted,
Arizona Slim
The response from the AG’s office: Crickets.
Arizona Slim,
“even when they could have qualified for prime-rate loans”
Hey! ( That’s ‘my’ soapbox! ) Exactly, there was no fiduciary responsibility and that MUST have been made a mandatory disclosure! Not in REIC-World, whatever you can get away with is what you can get away with.
Crickets indeed.
Wow. I’d say he probably deserved it, but that’s just not a very christian, thought, now is it?
Are you kidding, According to them God burns people for eternity for following the wrong religion or no religion at all or not interpreting the good book the same way they do.
Freddie Mac to delist shares from NYSE
NEW YORK (MarketWatch) — Freddie Mac (FRE 0.67, -0.55, -45.28%) , the giant mortgage finance firm that is operating in government conservatorship, said Wednesday that it has notified the New York Stock Exchange of its intent to delist its common stock and the 20 listed classes of its preferred stock. Freddie said in a press release that, “this notice was made pursuant to a directive by the Federal Housing Finance Agency (FHFA), Freddie Mac’s conservator, requiring Freddie Mac to delist its common and preferred securities from the NYSE.” According to a press release by FHFA, the agency issued similar directives to both Freddie Mac and Fannie Mae. Freddie said it expects its shares to trade in the over-the-counter bulletin board market after the delisting. The delisting should occur around July 8, the firm said.
Wow what a shock, extending a “temporary” tax.
Legislature approves extending Albany’s hotel tax
The Business Review (Albany)
The hotel/motel bed tax in Albany County, N.Y., would be extended for two years under a state law approved by both houses of the Legislature and awaiting the governor’s signature.
The state Assembly approved a bill yesterday to extend the sunset date of the 6 percent bed tax from Dec. 31, 2010 to Dec. 31, 2012.
The same bill was approved by the state Senate in March.
The bill was sponsored by Assemblyman Jack McEneny and Sen. Neil Breslin.
The bed tax is collected by all hotels and motels in the county with at least 25 rooms. The tax generates about $6 million annually.
Wow what a shock, extending a “temporary” tax
It a revelation I tell ya…
Nobody goes to Albany for fun. That one’s about soaking businesses.
Oakland Sends Out Layoff Notices To 200 Officers
CBS 5 CrimeWatch
Despite concerns about the city’s violent crime, the Oakland City Council on Tuesday voted to send out layoff notices to 200 police officers.
There seemed to be little choice. The city is facing years of multi million dollar deficits, and the public safety budget is a rich target representing about half the general fund.
“The entry level salary in the Oakland police department, depending on certain specifics, ranges from $71,000 to $90,000;” said City Council member Rebecca Kaplan.
Wouldn’t it be better for everyone if they reduced salaries and pensions for police officers? The city will be much more dangerous for the remaining officers if there are fewer cops to spread around.
Yep. But they won’t vote for it. The older guys got theirs and the young guys can go to hell.
Sounds like the airline industry. All of the old gummers are making sure we don’t get jack.
“Wouldn’t it be better for everyone if they reduced salaries and pensions for police officers?”
Are you assuming there is a fixed budget for police officers in Oakland? Assuming no, there is a complicated optimization problem for city managers to consider. Out of a fixed budget, one needs to balance the number of officers needed in a high crime city like Oakland to address public safety concerns against the salary needed to attract peace officers into dangerous occupation. If the budget can be adjusted, the question becomes how much to provide for a large enough police force to both retain qualified officers and provide enough of them to keep the crime problem under control. If the crime problem is bad enough, you get the black hole ghetto dynamic going, where any reasonable person who can afford to live or work elsewhere will do so, and only the destitute or criminal remain.
“…black hole ghetto dynamic…”
Forgot to mention that this also has implications for housing prices; other things equal, a higher crime rate implies lower property values (both residential and commercial).
PB,
Why does it always have to be a “black” hole, huh? How come it’s never a “whitey” hole?
-Big V
PB, don’t you know that “black hole” is racist? At least if you’re the Hallmark Card Co.
‘…“black hole” is racist?’
What about Black Death, or Black Humor, or Black Friday, or …
“Whitey Death, Whitey Humor, Whitey Friday…”
It don’t mean a thang if it ain’t got that ring…
do-Wah do-Wah Doo-wa do-Wah do-Wah…
better for everyone if they reduced salaries ??
Well sure it would Big V but lets not let common sense prevail here…Fact is, the “brotherhood” gets tested when it comes down to cutting “my” pay and benefits…I got seniority here…
$71K to $90K entry level pay. Wow. That’s about 3x the entry level pay for sheriff’s deputies (patrol officers) in this county.
I wonder what the pay scale tops out at.
Bubble salaries in California, justified (at the time) by the cost of living/bubble real estate.
I know several guys who had to quit, rather than accept department transfers to California (the creative class have their creativity repressed by being forced to live among the peons, you see…..)
Even with a raise/COLA, they couldn’t justify having the wife quit and start over, then sell a house in Flyover, and pay 5 times the money for an equivalent house in California.
So they took a 20% hit to their salary, but were financially better off than if they had moved to California.
“SoCal and the Bay area…..it’s a different country”
Having moved from flyover to CA myself in mid life, I totally understand where those guys you mention are coming from…it really is different here, at least as relates to the home price to income ratio.
All true, except for some if you are a renter. While I’ve never lived outside the state, I think if you get the benefit of CA income, you don’t always pay out that differential in terms of higher rent. In other words, if you can avoid the “purchase a home at all costs” disease, you can end up being cash ahead by being a renter in CA vs. a renter in another state.
Said another way, a big part of the increases in salary that companies see as needed given the cost of living in CA is due to the high cost of purchasing a home. So, if you simply refuse to purchase, pocket the difference and move back to another state after a few years of enjoying the moderate climate.
Part of this can be attributed to Prop 13 (perversely). Owners of apartments don’t have their property taxes increased with market values, but their taxes are capped. This has the double effect of 1. keeping a lid on rents, as landlords don’t feel as much of a squeeze, but also 2. some landlords don’t do extensive renovations, to keep their taxes low (renovations would tend to increase assessed value), so they continue to be low cost providers on the rental front, and will comfortably stay there.
In other, non-prop 13 states, if property taxes go up, landlords need to raise rents to try to keep up, and may be forced to upgrade the units in order to compete.
Don’t know if anyone disagrees with this position, but this is what I see as a renter in CA when I talk to friends in other states about the rent/income ratio.
“So, if you simply refuse to purchase, pocket the difference and move back to another state after a few years of enjoying the moderate climate.”
We owned in CA during the bubble runup, then sold. Now we pay under 25% of our annual income on housing while others watch their beloved homes drop by $100K increments. It may seem unfair to long-time residents who believed that CA real estate always went up, but as an observant and financially precautious outsider, it seems pretty fair to me.
$71K to $90K entry level pay.
Better than what software engineers get, plus cops get big fat pensions and retire when they’re still young.
Cops should make more than software engineers. I dont mind well paid cops and firefighters. Walking into a burning building or walking into a dark alley a 2am looking for the bad guy should pay very well.
Writing java? Not so much. Sorry software guys, what you do is not that hard. Anyone with a couple of community college classes can do it.
I’m not saying that cops and firefighters should get paid less, but I think you are undervaluing good software engineers. It’s not just Java.
It’s Google.
It’s Microsoft.
It’s Oracle.
It’s Apple.
These are big economic drivers, which, with due respect to community college graduates, could not be easily replicated with a common cabal of community college students.
And I’m not a software engineer, but I know some who are pretty damn smart and couldn’t be easily replaced. While firefighters and cops should get bigtime hazard pay for being the ones willing to run into a burning building to save us, or stop a man with a gun from killing us, there are lots of people fighting for the jobs, with few barriers to entry except courage (which many don’t have).
Sorry software guys, what you do is not that hard.
I’m in software and have said before that I could apprentice a bright HS grad to do my coding in a year or so, so I agree with you in that respect. The problem is that they do need to be comfortable with a high level of complexity…I write FW in a multi-processor RTOS environment so the devil is in the details when something doesn’t work right, which is all the time. So actually, sometimes it is that hard.
Don’t argue with the Eddie. It’ll only encourage him.
Until my senior year of college the most I had used a computer for was email and word processing. In business school I took an interest in technology since it was the late 90s. I bought a few books, read them cover to cover. Then I started screwing around with visual basic at first then Java. It’s really like learning a language. Once you have the basics down, the rest comes easily. I was actually amazed at how straight forward it all is.
It aint rocket science kids.
I wonder what the pay scale tops out at ??
79k-90k ?? Thats chump change around here…Try a buck-twenty for a fifth year guy easily going to a buck-and-a-half with all the overtime…How about a buck-seventy-five for a Captain…
Against my advise, a friend just bought a house in Freemont, CA for $580000 on a income of $150K. He sounded like it was an awesome deal. Does anyone know what’s the market like in Freemont? He said that he put offers to 20 houses and always got outbidden by others.
I hope he finds happiness and peace in that house. But I don’t think it’s a smart move. Any opinions?
Fremont is gangsterville. Too late for your friend now. Try not to gloat in two years when he’s bummed about the whole thing.
I don’t know Fremont except that I wouldn’t live there (I value my ultra-short commute). I think there may be some nice places there, as it is a quick commute to Palo Alto/Menlo Park/Mountain View, but much, much cheaper. I recall hearing of a young professional couple that my wife knows who bought a big house in Fremont for about $1MM a while ago, I’m sure it’s worth less now–how much less is the big question.
Fremont does have some jobs (not roaring economy by any stretch), but some green tech is finding its way there–I think Solyndra has a big plant there, and Toyota is teaming up with Tesla to build cars/parts in Fremont.
I would be curious to see how big the house is, and what the school district/neighborhood looks like (I agree with Big V that there are some sketchy areas of Fremont). I’d then compare it to Mountain View. My guess is that he got decent value as related to Mountain View, but took some risk on the downside given the perceived inferiority of the City of Fremont.
All that said, there isn’t a lot of new housing that has been built (or will be built) within a 30 minute commute of Palo Alto (and Fremont would be about 20 minutes). If he got a good quality home, the price may not go down at all…
From Gawker: Redfin recently had the White House listed for sale. Much comment merriment follows.
Is it a short sale?
I think it’s an REO. There’s a squatter living there now.
Is it a short sale ??
Yes….Best offer under 13 1/2 Trillion gets it….
Is anyone interested in purchasing a 4 bedroom home in La Jolla, CA? There are 167 of them currently listed on the MLS from $925,000 on up; of course, there is no telling how many might be lurking at this point in shadow inventory. Unfortunately for both buyers and sellers, there is no GSE financing for these unless you can come up with a downpayment of $200,000 or so, as the conforming loan limit for La Jolla is $729,750.
The aggregate of all list prices on this group of 167 homes is a cool $770 million. And these are just four bedroom+ sized homes; two are condos and the rest are single families. I am not sure if the usual inventory of homes on the MLS for La Jolla approaches $1 bn worth, but my hunch would be that this situation is a bit unusual.
It will be interesting to see how long it takes La Jolla to clear out $1 bn or so in used home inventory currently on the MLS. My sense is that there is not $1 bn worth of demand currently in the market for high-end family housing in San Diego, but perhaps a bevy of banksters armed with TARP bailout money will relocate from Manhattan to La Jolla and prove me wrong?
The BP board has decided it will not be paying any additional dividends this year. Bunch of pissed off pensioners over in the UK.
Well, what are they going to do?
Last time they were in a war, I seem to recall that they had to get some help from us. And when they went to war against us, we won.
I’ve said it before: if they wanted a reasonably steady income stream, they should have bought bonds. Stocks are not a clean substitute.
Of course, but I’ll bet the dividends were better than anything bonds paid. They probably figured “Hey, its an oil company, what could possibly go wrong?”
Looking for work? Unemployed need not apply.
NEW YORK (CNNMoney.com) — The last thing someone who is unemployed needs to be told is that they shouldn’t even apply for the limited number of job openings that are available. But some companies and recruiters are doing just that.
Employment experts say they believe companies are increasingly interested only in applicants who already have a job.
“I think it is more prevalent than it used to be,” said Rich Thompson, vice president of learning and performance for Adecco Group North America, the world’s largest staffing firm. “I don’t have hard numbers, but three out of the last four conversations I’ve had about openings, this requirement was brought up.”
Looks like they picked up the story from HuffPo.
Employers know they can take the pick of the litter as there won’t be any mas shiting anytime soon.
Happy ending to story about our Bay Area friends facing loss of one spouse’s employment w/ a high monthly mortgage payment: Turns out she survived the staff reduction. So the choice gets down to the relatively easier one of either staying at home w/ the kids but moving to a less desirable home, or going back to work and staying put.
Republicans seek pay freeze for federal workers; a ‘cynical ploy,’ Democrats say
By Perry Bacon Jr.
Washington Post Staff Writer
Tuesday, June 15, 2010
Looking to demonstrate their commitment to balancing the budget, Republicans are increasingly targeting the federal workforce.
In the past month, congressional Republicans have tried to attach to several bills language that would limit pay increases for federal workers. This week, as part of a GOP amendment to a Democratic bill that would spend billions on unemployment benefits and help states fund their Medicaid programs, Senate Republicans are including a proposal that would freeze pay levels for the 2 million people who work for the government.
Similar proposals have failed in the House and Senate, and Democrats probably will vote this one down as well. But Republicans say they are determined to keep pushing the issue, arguing that federal employees should not receive pay increases while many private-sector workers face cuts in pay, hours and benefits, as well as layoffs.
“We’re paying too many people too much money,” said Rep. Jason Chaffetz (Utah), who has pursued the matter as the top Republican on a congressional subcommittee that oversees the federal workforce. “I’d actually like to see [federal salaries] cut.”
President Obama has proposed increasing federal workers’ pay by 1.4 percent this year, less than recent increases. He has also called for freezing spending at most agencies for the next three years.
At the same time, Democrats argue that the GOP proposal for federal pay is largely symbolic. The national budget deficit last year was more than $1 trillion; the pay freezes would save less than $3 billion.
“We need to reject this cynical ploy to make federal employees a scapegoat for spending after congressional Republicans added trillions to the debt when they were in the majority,” Rep. Steny H. Hoyer (Md.) said before the House voted down one of the pay measures.
…
Gotta start somewhere. $3B sounds like a good start to me. Government employees are not the scapegoat, they are simply overpaid already.
“…they are simply overpaid already.”
That’s a very broad generalization. But don’t bother posting any evidence — we’ll be happy to take your word for it that government employees are generally overpaid, especially compared to Wall Street banksters, who earned every penny of the bailout-funded bonuses they received last year.
Local economic observations….
U-Haul count on the Interstates is way down.
Lots of empty center-beam flat cars (used to haul lumber/lumber products mostly) in the local BNSF and UP yards. They’ve been coupling together long strings of empty cars and moving them somewhere…..like they were doing with the autoracks 18 months ago.
Picked up my car at the shop today. They don’t take personal checks anymore, cash and debit/credit cards only.
More perp walks. I told you guys it would take time. There’s just so MUCH of it out there.
http://online.wsj.com/article/BT-CO-20100616-712710.html?mod=WSJ_latestheadlines
US Prosecutors Charge Lee Farkas With 16 Fraud Counts
WASHINGTON (Dow Jones)–A federal grand jury has indicted the former chief executive of what was once among the nation’s largest independent home-loan providers on 16 counts of fraud.
In documents filed in federal district court in Virginia, prosecutors said Lee Bentley Farkas, the one-time chief executive of Taylor, Bean & Whitaker Mortgage Corp. caused more than $1.9 billion in losses through a scam that started as early as 2002.
This is pretty cool…
http://www.forbes.com/2010/06/04/migration-moving-wealthy-interactive-counties-map.html
From Forbes showing where people are coming from/going to.
Good find!
That is way cool! Here are a few counties which, you will see, are spectacularly bleeding red, if you click on them.
Of those with buttons on the lower left of the graphic, these are the bloodiest explosions:
LA
Chi
Miami
Detroit
Of cities not shown, here are some of the bloodiest:
San Diego (red lines going every which way!)
What Coming Wave of Corporate Debt Means to Investors.
16 Jun 2010 ~ CNBC
In yet another hangover from 2007, expect a wave of both investment grade and “junk” corporate debt coming due.
How big is the wave? About $1.7 trillion worth, according to a new report from Standard & Poor’s titled “Wave of Debt Coming Due May Wash Away Some U.S. Speculative-Grade Borrowers”. And that $1.7 trillion is just for non-financial corporations in the U.S.
According to S&P Managing Director John Bilardello, there is another $1.5-2.0 trillion dollars worth of corporate debt coming due outside of the U.S.
Part of the reason behind this debt hangover was the wave of leveraged buyouts (LBOs) in and around 2007. Those deals left some of the borrowers long debt, short cash. The debt has been getting rolled in so-called “amend-and-extend” deals and comes due over the next few years.
And some of those LBOs were all time record setters.
Ouch.
“And that $1.7 trillion is just for non-financial corporations in the U.S.
According to S&P Managing Director John Bilardello, there is another $1.5-2.0 trillion dollars worth of corporate debt coming due outside of the U.S.”
What’s $3.2-$3.7 trillion between friends? I see nothing here a little bit of coordinated ‘faster-than-usual’ fiatsco printing cannot fix.
The job of an investor is to do his damnest in making sure he is not on the wrong end of any of this debt.
Cash is king, etc.
Nothing to see here folks, move along
Erroneous trades of Washington Post stock trigger new circuit breakers
By Tomoeh Murakami Tse
Washington Post Staff Writer
Wednesday, June 16, 2010; 6:11 PM
NEW YORK — Erroneous trades briefly prompted shares of The Washington Post Co. to more than double in value Wednesday afternoon, triggering for the first time new circuit breakers put in place by the Securities and Exchange Commission after the “flash crash” that sent markets plunging last month.
An NYSE Euronext official said that trading in Post Co. stock was halted at 3:07 p.m. after three apparently erroneous trades went through NYSE-Arca, an all electronic trading platform. Two of the trades were for $919.18 per share, and another went through at $929.18 per share.
The company’s stock had been trading at roughly $455 per share prior to the three trades, which are expected to be canceled. Trading in Post Co. stock resumed five minutes later, at $453.25 per share.
http://www.washingtonpost.com/wp-dyn/content/article/2010/06/16/AR2010061604557_pf.html
Die, bubble, die…
* The Wall Street Journal
* CAPITAL
* JUNE 17, 2010
Rethinking Part of the American Dream
* By DAVID WESSEL
It’s time to have a serious conversation about the American approach to home ownership and mortgages. A system once celebrated for putting so many families into their own homes and for making mortgages so widely available has become, as one housing economist puts it, “a case study in failure.”
Beyond the complexities of securitization, the merits of home ownership tax breaks and the politics of Fannie Mae and Freddie Mac lurk two fundamental issues.
One, the U.S. has for decades overemphasized the virtues of home ownership.
Two, many Americans are addicted to a unique, and costly, strain of mortgage—a 30-year fixed-rate loan that can be paid off at any time without penalty.
The U.S. has long seen home ownership as an unquestioned virtue, dating to a 1918 government “Own Your Own Home” campaign. Herbert Hoover, Franklin Roosevelt, Bill Clinton and George W. Bush all talked as if owning a home was the only way to join the middle class. Not only did it promote social stability—recall Mr. Bush’s “ownership society”—and build well-maintained neighborhoods, home ownership became a hedge against inflation and a way to save for retirement. Until it didn’t.
Home ownership rose from around 40% of households in the 1940s to about 60% in the 1960s and then hovered around 65% until the 1990s, when a government-backed push to spread ownership, particularly among minorities, helped lift the rate, reaching a peak of 69.4% in mid-2004.
Some of those new homeowners, including those sold outrageously inappropriate subprime loans, should have remained renters. Many couldn’t afford to maintain the houses they bought. Others were dependent on refinancing to keep their homes, an approach that worked only as house prices kept climbing. They didn’t. At last tally, the U.S. home ownership rate was at 67.2% and sinking.
The rub: Many virtues of home ownership evaporate if the value of the house falls to the point where one owes more on it than it’s worth.
To examine the eye-popping dimensions of the housing bust, New York Federal Reserve Bank economists calculate the fraction of families who actually have equity in the house they own. In San Diego, for instance, the home ownership rate had fallen to 55% last year from a peak of 63%. But by late last year, the fraction of households with equity in their homes was between 35% and 39%. In hard-hit Las Vegas, nearly 59% of households own their homes, but only 15% to 19% of households own a home in which they have any equity left.
For many, the American dream of home ownership turned into a nightmare of debt and foreclosure. Some people should rent.
As late as the 1930s, a U.S. mortgage was generally a loan for three to five years, at which time the borrower had to pay it off. Then the government fostered the 15-year fixed-rate mortgage—and eventually the 30—and the concept that the homeowner would pay off principal in monthly installments.
Most other countries rely on mortgages in which the rate is fixed for only three to five years. In the U.S., one usually can refinance a mortgage without penalty to take advantage of lower rates. More than 70% of mortgage applications filed in early June were for refinancing existing loans, the Mortgage Bankers Association says. Elsewhere, refinancing is less common. Adjustable rates and prepayment penalties make it less alluring.
At a Cleveland Federal Reserve Bank conference last week, Patrick Lawler, chief economist of Fannie and Freddie’s regulator, said people who take a 30-year fixed-rate mortgage are buying a two-fer: a loan plus the right to prepay without penalty. You might call it a derivative that protects the borrower. Rates fall, you refinance; rates rise, you don’t pay ‘em. Mr. Lawler estimates this feature adds at least one-quarter to one-half a percentage point, probably more, to the rate on every mortgage.
And there are the side effects. The cherished right to repay a mortgage and get a cheaper one creates a huge, lucrative refinancing industry whose value he questions. And it creates a need for Fannie and Freddie, which may end up costing taxpayers more than any other element of the much-reviled bailouts. Without them to guarantee repayment of a loan and lubricate the market, the 30-year fixed-rate loan would be more costly and less common. But Americans might be better off.
The success of a mortgage-financing system should be gauged not only by how many people own their homes, but by whether it can absorb shocks without crumbling. “Ours has failed that test twice—once with the savings and loans and then recently,” says Michael Lee, a housing economist now at San Diego State University. “If you look at the outcomes,” he says, “other countries have equal or greater home-ownership rates with less volatility and fewer government subsidies.”
Today, the U.S. guarantees nearly all new mortgages, and there is no sign that’s about to change soon. But it’s well past time to rethink the over-celebration of home ownership for all and to question if allowing Americans to refinance with such ease makes sense.
Write to David Wessel at capital@wsj.com
This deserves a re-post tomorrow.
And who did making the loan a longer term benefit? The FIRE sector. It sucked money from the rest of the economy and funnelled it to the FIRE sector.
As I’ve said before, financial innovation falls in one of two categories - 1) New betting games and 2) Ways to extract more wealth from the borrower without the borrower realizing it.
Reuters Breakingviews
Fannie and Freddie Falling Off the Big Board
By RICHARD BEALES and ROBERT CYRAN
Published: June 16, 2010
The mortgage financing giants Fannie Mae and Freddie Mac are at last slipping into a form of obscurity. The companies will delist from the New York Stock Exchange under order of their federal watchdog. When they start trading in the penny stock market, investor attitudes may change — but the government fiction that the two are private companies almost certainly won’t.
The ostensible rationale for the Federal Housing Finance Agency’s directive to move them off the big markets is that Fannie’s stock lately has averaged less than the $1 minimum price required by the N.Y.S.E., while Freddie’s has fallen close to that level. With no obvious argument to reset their share prices, a delisting was inevitable.
More significant, the two companies cannot continue pretending to act in the interests of public shareholders while behaving as arms of the government. Fannie and Freddie are propping up the residential housing market. They end up holding or guaranteeing almost all new mortgages, and their regulator wants them to back more home lending to people who, with the best will in the world, can scarcely afford the payments.
…
Is “falling off the Big Board” anything like “falling off the wagon,” something to which those enjoying a hair-of-the-dog hangover cure have evidently succumbed?
Does anyone besides me think pouring unlimited amounts of taxpayer dollars down the GSE rat hole will make them TTT’s Waterloo? The ongoing operation of these defunct corporations has evolved from merely preposterous to utterly whacky.
Reuters Breakingviews
Fannie and Freddie Falling Off the Big Board
By RICHARD BEALES and ROBERT CYRAN
Published: June 16, 2010
…
More significant, the two companies cannot continue pretending to act in the interests of public shareholders while behaving as arms of the government. Fannie and Freddie are propping up the residential housing market. They end up holding or guaranteeing almost all new mortgages, and their regulator wants them to back more home lending to people who, with the best will in the world, can scarcely afford the payments.
Disappearing from the Big Board will make Fannie and Freddie less noticeable, though they will continue to file reports with regulators. The ranks of shareholders, who seem to have clung to some kind of option value by keeping the companies’ market capitalizations not far off $1 billion each, will no doubt be further reduced to those who can tolerate illiquid over-the-counter trading. But what perhaps really should happen — a purchase of the shares by the government — won’t.
That is because separate ownership is critical to the concept of keeping the debt and guarantee obligations of the two behemoths — more than $5 trillion combined — off the government’s books. The Treasury has agreed to pour money into Fannie and Freddie — about $140 billion so far, but with no limit — to keep their net worth above zero. That is in substance a full guarantee, but not one the government recognizes.
…
Has the Fed always operated as an unregulated hedge fund without the checks and balances of the other three branches of the U.S. government, or is this a recent development?
June 16, 2010, 10:12 p.m. EDT
Day 2 of bank reform: Legislators OK ongoing Fed audit
By Ronald D. Orol , MarketWatch
A previous version of this story misstated the party affiliation of Rep. Ed Royce. The story has been corrected.
WASHINGTON (MarketWatch) — Democratic lawmakers in negotiations to resolve differences in sweeping financial-reform legislation agreed Wednesday to allow ongoing audits of the Federal Reserve’s books, with Senate lawmakers signing on to a broader investigation authority from a House bank bill.
As part of the deal, lawmakers agreed to a one-time Government Accountability Office audit of the Fed’s emergency-lending programs. It also includes a House panel provision that permits ongoing audits of the Fed’s discount window, a government-lending facility from which banks borrow reserves.
The House-Senate language also requires the Fed to make public the names of banks that borrow from the Fed’s discount window and from its emergency-lending programs, but with a two-year delay.
These provisions weren’t enough for Rep. Ron Paul (R., Texas), who is seeking much more expansive audits, a firm deadline for them and quicker disclosure of borrowers from the discount window.
Paul told MarketWatch that he is concerned the GAO would not have the authority to audit future emergency-lending facilities nor would it permit audits of the Fed’s overseas investments.
“They can make loans to central banks and governments without our oversight,” he said.
…
People talk about the importance of the independence of the Fed. But the Fed is made up of people just like Congress is. Goldman Sachs alumni among others. People who are interested in their own personal gain and that of their friends. What makes them so saintly and unquestionable? There’s gotta be some leash put on the Fed.