Bits Bucket For June 27, 2010
Post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
April 2025 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
“We’re heading towards a double-dip recession,” says Chris Whalen, a former Fed official and now head of Institutional Risk Analystics. “The party is over from fiscal support. These hard-money men are fighting the last war: they don’t recognize that money velocity has slowed and we are going into deflation. The only default option left is to crank up the printing presses again.”
“…money velocity has slowed and we are going into deflation.” Well, of course we are. The money flood was supposed to fix things, but the big dark hole of debt sucked up the money and screamed for more. Remember all the experts who said hyperinflation was on the door step?
Maybe they’ll yet succeed in getting hyperinflation going. A few more trillion dollars off the printing presses might do it. Albert Edwards of Societe Generale is saying “We are now walking on deflationary quicksand.” ~ Money Blitz
I’ve been thinking a lot about the economy during this trip and driving around all these neighborhoods. IMO, these government housing programs have been a failure. I was able to randomly go down many a street and see abandoned houses and foreclosures, which goes to show you can’t artificially induce people to consume more housing than they need; in a recession, anyway.
Many areas are just flat overbuilt, and some don’t fit with real housing demand. Tax credits and loan mods can’t fix that. Another thing that’s been obvious to me on this trip is the commercial overbuilding, especially in Florida and Texas. Some of us here have been saying that ‘recovery’ in an economic sense means doing something beside building and selling each other houses. I guess we’ll find out if that ever sinks in in DC.
“Many areas are just flat overbuilt, and some don’t fit with real housing demand”.
So very true, we see home building in our area of central S.C. and ask, who the heck would buy it and why? Recently a developer here added townhouse’s that connect to a Publix grocery store, with very limited(2 per unit) uncovered out door parking. Starting at $425,000.00. They are marketing them to young college grads looking to live downtown near the “artsy” district, called the Vista.
Yesterday I posted a photo of a simple townhouse in Woodbridge VA that had an ‘Improved Price’ sign on it. It was a nice little place in a sea of townhouses on a marina. There was a glossy cardboard thing on the sign with a sticker over the previous price. The old one was about $435k, the new one was $425.
What is generally missed, IMO, is that $400k is still a lot of money. The big builders are still throwing up more, and why not? The price is giving them the incentive to continue to build. This is just part of what policymakers don’t get. Overbuilt or not, as long as the price is high enough construction will continue, that is, economics 101 tells us that a price lower than break-even is what forces production to stop.
“What is generally missed, IMO, is that $400k is still a lot of money”.
Once again, true, $400k is a ton of money, yet some how we have been conditioned to think that even though it’s are large sum, don’t worry about it, it is spread out over time and will probably appreciate in value. So go ahead and sign the dotted line, and if it doesn’t work out don’t worry about it a government sponsored remedy will come along.
Fact is there is no stopping this long coming correction, try as they are.
The comment someone wrote that got me hooked on this blog, years ago, went something like “this just in - $500,000 is a lot of money”! I think the discussion centered on how back in the mania, people would leave off everything but the 1st digit where talking about house prices, as in “I just bought a condo for “5″, or I just signed up for a couple houses at “6″. Like it wasn’t real money. The people on this blog back then all understood how ridiculous, and scary, that was.
“…yet some how we have been conditioned to think that even though it’s are large sum, don’t worry about it, it is spread out over time and will probably appreciate in value.”
There may also be some individuals who are holding out hope for higher future inflation to mitigate the real cost of making future debt payments. This worked out well for anyone who bought a U.S. home on a 30-year mortgage during the early 1970s; what is to stop it from happening again?
There may also be some individuals who are holding out hope for higher future inflation to mitigate the real cost of making future debt payments. This worked out well for anyone who bought a U.S. home on a 30-year mortgage during the early 1970s; what is to stop it from happening again?
Doesn’t this work out better if there are jobs and wage inflation? Given the large number of unemployed and underemployed and little on the horizon to put any significant number of them back to work, wage inflation looks very unlikely and wage deflation more likely.
“What is generally missed, IMO, is that $400k is still a lot of money.”
Hell, IMO $200k is a lot of money for a house and much more for a townhouse! I am not the sharpest tool in the shed, but in 2004 when I started looking for a bigger house for my wife and 3 kids and saw house prices way too high and climbing like a rocket. Looking for a reason is how I found Ben`s site. Well what was the reason? I guess greed and stupidity. How come it is taking so long to correct? I guess greed and stupidity.
“Doesn’t this work out better if there are jobs and wage inflation?”
That’s a bit of a conundrum…
“this just in - $500,000 is a lot of money”
This just in: The emperor is naked!
“I just bought a condo for “5″, or I just signed up for a couple houses at “6″. Like it wasn’t real money.
20% down payment, or even 5% down payment, would have dispelled that notion FAST.
This just in: Glamour shots and balloons do not a successful realtor make.
“$400k is a ton of money, yet some how we have been conditioned to think that even though it’s are large sum”
Allow me BJ and WMBZ……
$400k is a ton of money
$400k is a ton of money
$400k is a ton of money
$400k is a ton of money
$400k is a ton of money
$400k is a ton of money
Say it again and again and again and again and I still haven’t said it enough.
To me, this is the core issue related to the housing debacle since the beginning, circa 1998. Even today, $1000 is alot of money, period. But what did we all observe? Brain dead twenty-somethings inferring, implying or flat out acting as if $500k is somehow chump change. I don’t care about the house/housing/lying realtors or what you’re buying, $500k is an enormous sum to me and nearly everyone I know. Yet these same people seem to think $500k is going to fall out of the sky when they discuss selling their house. Given the constant interference by public officials as a result of NAR’s deep pocket lobbying, it will take years if not decades for this distorted view of housing to correct.
I have a bulletin for the NAR corrupted decision makers: The day the sun sets in the east is when I’ll sign up for a $500k debt burden. Further to the point, I always act in a way to discourage others from buying any housing and I always will until I see indisputable evidence of capitulation and the withdraw of market distorting public policies.
EX you filthy rich guy………$400K LOL
In the great Mogambo voice:
2 HUNDRED THOUSAND DOLLARS IS A LOT OF FREAKIN MONEY FOR A HOUSE!
“$500k is an enormous sum to me and nearly everyone I know. Yet these same people seem to think $500k is going to fall out of the sky when they discuss selling their house.”
I think it is interesting that on the way up, people just bid whatever it took to get the house. So you had to bid an extra $50k, appreciation would take care of it in one year. Then you had a cash cow for eternity. Now as prices are falling people are dropping the asking price by $5k and advertising “just reduced”. Now $5k is real money. Not so many high rollers anymore.
“This just in: Glamour shots and balloons do not a successful realtor make.”
Well, if the balloons are all that she is wearing…
Another thing that still baffles me is that buyers were able to get loans at prices 8 to 10 times their annual household income.
Not adding anything useful, but in 2005-2007 I’d occasionally look at properties that were just a bit too expensive for me, and I’d start imagining living in a larger, shiny place, but then I’d always come back to: “one half of one million dollars .. how can I pay half a million dollars for a condo?” And $500K condos weren’t all that special in the So Cal beach cities; prices look like they’re dropping into the low $400K range, and I’ve been fixating on a 900 sq ft condo for $430K, but I still keep coming back to the same question: how could I spend so much money for a place with common walls, monthly dues and association infighting?
Mofa:
Its because you have money to burn, and who knows how many super hot beach babe chicky poos live in the building….well you do have to pay one way or another…
Another thing that perplexes me is, I know builders, build and lenders, lend, but why on earth when there are so many failed developments and so many properties sitting idle, would a bank loan money on something that may not sell for years and may in fact go bankrupt.
Risk is something we all take, but we do/try your best to come out on the winning side. The things I am watching being built are poor and in some cases doomed to failure, yet someone is approving the loans.
That’s what I always wonder about commercial real estate here in South Palm Beach County, where it seems like 90% of all the commercial completed over the past 5 years has never been leased. When the builders went to the banks, who did they say was going to lease all this space? What were all those people going to DO there? The way it looks, 20% of the Fortune 500 would have to move their HQ’s here to fill up the space. Is that what the banks believed? Don’t builders have to have some sort of justification for the money they want? Or do builders just say “give me some money for an office building and make it snappy” and the banks give it to them?
I recently posted pics from Texas showing more than one builder, but Lennar particularly, advertising $0 down loans on a street with 2 foreclosures. One was a Fannie Mae house. I guess the short answer must be that the Fed and DC are still making money too easy to get. Why have none of the big builders gone under? Somebody is financing them and the low interest rates/TARP funds probably have a role in that. Instead of turning the economy toward a sustainable future, the government threw a ton of $ at keeping lenders going that should have closed, inducing people to buy houses they can’t afford on terms that aren’t much different than 2003.
Then they declare victory and start talking about something else like ’saving homeowners.’ Hell, they’re minting new FBs left and right.
If you are a banker and your bank is owed a lot of money by a builder then you have an interest in keeping the builder solvent so he may pay back your bank. Since builders make their money by building then you need to keep them busy building. If they stop building then they go out of business and then your bank looses out on what money it is owed and you lose your job as a banker.
The longer you keep the builder solvent the longer you get to keep up the facade that your bank will eventually get paid back the money the builder owes and the longer you get to keep your job.
“…doomed to failure, yet someone is approving the loans.”
Are the approvals driven by private interests or political interests? Take the case of the defunct GSEs; it seems Uncle Sam doesn’t mind operating them indefinitely at a loss to taxpayers, so long as doing so meets the requirements of someone’s behind-the-scenes political objectives.
“…’saving homeowners.’ Hell, they’re minting new FBs left and right.”
How to use FBs to bolster reelection prospects:
1) Mint FBs left and right.
2) Pass a ‘Save Our Homes’ bailout measure to charge others the tab for keeping FBs in homes they cannot afford.
3) Cook up some numerical estimates of how many home owners were saved and use them to bamboozle the sheeple into voting for you.
It blows me away that there are still places where builders are still building. Residential construction came to a screeching halt 2 years ago out here.
A related anecdote: you see significantly fewer illegals and their brood at the local WalMarts. I guess when the saws stopped buzzing they packed it in and headed for greener pastures.
And if you’re wondering how I can tell they are illegals and not local hispanics, the locals have a unique accent when they speak in Spanish (I lived 12 years in Mexico). Most of the hispanics I see at WallyMart are locals.
“It blows me away that there are still places where builders are still building. Residential construction came to a screeching halt 2 years ago out here.”
It’s a mixed bag near me. Two projects have had no activity in more than two years. One got as far as clearing the lot and the other had started construction and poured concrete up to the first floor.
Another project a block from me appeared to be delayed for a matter of months, but is now moving toward completion. The web site says from the upper $500k for 1600sf townhouses. That’s lower than bubble pricing which topped out around $500/sf, but still pricey and out of line with incomes. The web site still has bubble terms - “interest list”.
Why would lenders continue to lend to builders who continue to build?
Because they’re all stupid. They probably all went to the same conference, where some dull blade gave a talk (a PowerPoint presentation, to be sure), with oodles of snappy-looking charts and graphs, all showing how the “recovery” is going to make them all rich, as long as they don’t lose faith now. The trick is to “lend, lend, lend”, you see. Unfortunately, the bankster clan is not sharp enough to pick out the fatal flaw in the whole charade: If your equations are all based on unreasonable and unmeaningful assumptions, then your pretty graphs and fancy presentation are not worth their salt. The recovery is not going to happen for a long time.
They (the banks and FBs) are just doing exactly what TTT is telling (pushing) them to do. Its the leadership that is the root of the problem.
definitely here, too
http://tinyurl.com/29barf2
Its the leadership that is the root of the problem.
You’re confusing cause and effect. The electorate who vote in the “leadership” are the true root of the problem.
Nobody voted for TTT or Bernacke or any BODs on Wall St.
And who appointed them to those positions and keeps them there? Elected officials.
Looked up greed and stupidity
Regulating greed and stupidity? No chance, says Intel boss
Sep 30, 2008 08:30 EDT
Everyone seems to agree the world needs better regulation to prevent a repeat of current turmoil.
But how exactly do you cap greed and stupidity, the driving forces behind today’s property boom-and-bust and past examples of “irrational exuberance” like the dot.com bubble?
Craig Barrett, chairman of chipmaker Intel, was not optimistic when he dropped into Reuters offices in London.
“I don’t know what regulation we’ll get but the issue is that people just got over-heated and over-excited and it’s really tough for the government to come in and slap you around and say it’s illegal to get over-heated and excited,” he said.
“That’s trying to regulate greed and stupidity, which are are two tough things to regulate.”
Greed vs. Stupidity
By Alan Stewart Carl
Both the greed theory and the stupidity theory lead to the conclusion that change is necessary. But how we change is predicated on where we see the faults. In the long run, I think were better off trying to increase smart decision making than we are trying to create a system impervious to greed.
“Greed vs. Stupidity”
- Not exactly mutually exclusive.
- Most typically go hand-in-hand.
How about this for regulation:
We let bad banks fail. Then let the FDIC bail out the depositors. The FDIC can protect itself by making sure that insured banks follow certain fundamental safety practices. Any insured bank that takes on too much risk gets their insurance dropped, thereby inducing the depositors to flee.
That oughta do it.
Greed and stupidity are regulated all the time. It’s called crime and punishment.
To suggest we shouldn’t or that’s it’s hard, is bull.
How many years were the warnings about Madoff ignored?
“Starting at $425,000.00. They are marketing them to young college grads looking to live downtown near the “artsy” district, called the Vista.”
37% of new college grads are unemployed. The rest are so indebted because of student loans I can’t see them buying something at $425,000 for a long time, unless their parents help them. My local librarian has just started paying off her first daughter’s student loans. The payments are $1,000/month.
Do these builders ever do market research?
Proper,
Your post took my breath away. I was a Boston post grad. Paid $100/mo to pay off student loans and so was able to rent a few houses down from the water’s edge. The boat I sailed on at night was feet away from the edge of my street.
Those numbers you posted are pure travesty. As many have said before, this cannot end well.
And how much do new college grads make? 40-50K, maybe a bit more if they have a technical degree.
I used to have a neighbor who had a house painting biz (this was in the mid 90’s). He though all recent college grads made 100K+
No, they don’t. No lie.
“…you can’t artificially induce people to consume more housing than they need…”
Certainly not by artificially propping up the prices! The Law of Demand suggests that at a higher price, a lower quantity is demanded. I would think someone in the Obamanomics brain trust would be willing and able to shine a light on this basic problem with artificially propping up housing prices, which goes far towards explaining why there are years of housing inventory in the pipeline relative to fundamental demand.
This has nothing to do with Obama. Supply and demand was chucked out the window by Raygun’s voodoo economics 30 years ago.
And secondly, the FIRE sector remembers the S&L disaster and will throw us all under the bus to not have to suffer the same consequences.
“IMO, these government housing programs have been a failure.”
You are in good company.
It’s pretty amazing how the financial reform legislation tried to keep these white elephant carcasses hidden under the living room rug. Good luck with that plan!
Fannie And Freddie: Where Do We Go From Here?
by Tamara Keith
June 25, 2010
There are two really big things that the sweeping financial regulation bill doesn’t even begin to tackle — Fannie Mae and Freddie Mac.
At $145 billion and counting, bailing out the mortgage giants is turning out to be the most expensive part of the financial meltdown.
Critical Components
Fannie and Freddie are basically expensive wards of the state. And yet, they are critical components of the housing market recovery — such as it is.
“Right now they’re responsible for the financing of roughly three out of every four mortgages,” says Ed DeMarco, the government’s conservator who oversees Fannie and Freddie.
In September 2008, the federal government stepped in to save the firms from insolvency. And the U.S. Treasury is backing up the firms’ losses — some estimate the total bill could reach $400 billion. Fannie and Freddie’s future is in doubt, but DeMarco says one thing is certain: “We cannot do this indefinitely.”
‘No Way To Run A Business’
Fannie and Freddie were created by Congress to expand home ownership. But they were also private companies with shareholders — a strange blend of public and private.
What these companies did, and still do, is buy loans from banks, bundle them up into securities and then sell the securities to investors — with the promise that if the loans go bust, the firms will take them back.
And go bust they have. As of April, the two firms were sitting on more than 160,000 foreclosed homes, each home representing more money down the drain.
“That’s unstoppable because those liabilities are sitting with Fannie and Freddie and taxpayers,” says Tom LaMalfa, who has been a mortgage industry analyst for 30 years. “So irrespective of what we do, the bill is continuing to grow.”
LaMalfa is among a growing chorus of people who say the government should get out of the mortgage business.
“I really believe we don’t need the government,” he says. “We don’t need this huge government presence. It’s done very few positive things. And it has created this huge liability. That’s no way to run a business.”
We don’t need this huge government presence. It’s done very few positive things. And it has created this huge liability. That’s no way to run a business.
“We tried, it was a dismal failure, and we’re never doing that again,” is what Dwight Jaffee says he would like to see on Fannie’s and Freddie’s tombstones. He’s a professor of finance and real estate at the Haas School of Business at the University of California Berkeley.
“The only role of Fannie and Freddie is to be an intermediary between the Main Street lender who makes the loan and the Wall Street investors who buy the mortgage-backed securities,” he says. “There’s plenty of private investment banks that will serve that role just as well as Fannie and Freddie.”
Of course, he says, there would be a transition period. But not everyone is ready to write that obit just yet.
…
“At $145 billion and counting, bailing out the mortgage giants is turning out to be the most expensive part of the financial meltdown.”
And also not part of the accounting when bailout (e.g. TARP) costs versus benefits are discussed.
Perhaps I misunderstood the purpose of the TARP, which I thought was to take care of the toxic asset problem (didn’t TARP stand for “toxic asset relief program” or some such?). Instead, it seems Feddie, Fannie and Freddie all e engorged themselves on toxic mortgage assets like a giant python eating a very large pig, while Megabank, Inc partied it up with the 2009 bonus money.
I know I oversimplify the situation here, but isn’t this roughly on target?
That is one good thing that didn’t happen where I live…there was almost no land to build on…and you would have had to tear down perfectly good 2 fam houses to put up what a 6 unit lux condoze so not enough profit.
Of course now they want to rezone a big chunk of the area just to tear down multiple properties and put 50+ unit buildings.
Now close by in Long Island city and Astoria you had some run down commercial strips that were torn down to put up these crap boxes, and they just aint a movin…
http://ny.curbed.com/tags/east-of-east
———-
Many areas are just flat overbuilt,
Overbuilt and overpriced.
Some of us here have been saying that ‘recovery’ in an economic sense means doing something beside building and selling each other houses.
Which is why there won’t be a recovery, as that is pretty much all that we do in the good old USA.
Or mow each others yards or sell each other Chinese crap.
It’s often been said that can’t really base an economy on everyone doing each other’s laundry.
After scamming 3000 billion out future taxpayers, the bonus’d up bankers would like to see a good rash of deflation. Maybe pick up a Greek Isle or two, a ranch in Argentina, maybe another flat in London or a co-op in Manhattan, couple more kis of gold; I can see November 2nd from my deck.
“…bonus’d up bankers would like to see a good rash of deflation.”
Good point! It’s hard to enjoy fire-sale prices without a massive dose of asset price deflation to proceed them.
I thought the rich liked inflation not deflation.
No. Home debtors and other fixed-income debtors like unanticipated inflation, as it reduces the real future cost of their debt payments. Conversely, anyone on a fixed income pension or who owns long-term bonds (aka the very wealthy) are harmed by ‘higher-than-expected’ future inflation. Presumably, the truly rich are at least in a position to protect themselves with inflation hedges. Not so much the middle-class retiree who was counting on their fixed-income private pension to deliver adequate income for life.
Now I’m confused. The rich prefer deflation, you say? Then why is the PTB trying so hard to reinflate the economy? Let it all crash and the rich can swoop in and buy it all up for pennies on the dollar.
Alpha:
Ive said for years not the rich but the Chinese..they wont put up with the destruction of dollars so we will have to sell them MSFT GE for $10 a share…Ibm for $50
—————————
Let it all crash and the rich
If we ever give bankers control of the money supply they will eventually own everything via a series of inflation and deflation.
The rich like both, because they can time both, because they create the cycles. When they get caught the Gov bails them out of their bad positions. They then sit on cash and wait for deflation.
Also no they won’t being buying greek islands with their bonuses. They will be paying down their mortgages. I bet many of them are underwater with their mortgages.
Thay actually practice what they preach.
I’ve already read about one ex-bankster getting into the business of buying up “distressed assets”, and then trying to securitize them. Ugh.
“Several things have become obvious: first, a ‘recovery’ is not going to happen; second, after 60 years of credit expansion, the world has entered a long period of financial adjustment and debt destruction; third, most economists should be put to work picking up trash along national highways. Not that they would do a very good job of it, but at least they would be kept out of mischief.” ~Bill Bonner.
“… the world has entered a long period of financial adjustment and debt destruction…”
In my view this is the most important aspect of this most important event of our lifetimes, this destruction of debt.
One person’s debt is another person’s money. If debt is destroyed then somebody is out some money. I keep harping on this fact but only because it is central to my thinking.
If you are a person that is on the wrong end of destroyed debt then you are a person that is out some money. It doesn’t make any difference whether or not this debt was borrowed or simply promised, if it gets destroyed then you are hosed.
This means the primary focus of one who yearns to financially survive these times is to get away from risky debt as much as possible and seek out ways to get close to cash as much as possible.
It also means one should hold on to a good job that pays out a steady flow of cash rather than seek retirement and depend on a lifetime flow of promised cash.
“If you are a person that is on the wrong end of destroyed debt then you are a person that is out some money.”
And you are also a person who should have done at least a modicum of due diligence before lending said money out.
Debt is should not be restricted to loaned money, it also should include promised money.
Pensions, Social Security, Medicare - all of this is promised money - a form of debt - and should not be depended on being paid off because the money is not there.
Promised money is about the only glue that is holding the wheels on this train; you dont want to think about what it would be like without those pension/disability checks, food stamps, section 8 housing, farm subsidies, VA hospitals, etc. Turning off the spigot would make those Greek riots look like a tea party.
Turning off the spigot would make those Greek riots look like a tea party.
Hee Hee….They said “Tea Party”..Term has been picked on alot here lately….
That day is coming my friends. And THEN the zombies will come..
Well for pensions the money IS there. It may not be enough, but it’s not like SS where it all has to come from future taxes. For example my company pension plan is OK. They had to cut out the health care benefit, but there’s enough to pay pensions, as long as they don’t invest it all in Greek bonds.
“”Well for pensions the money IS there. It may not be enough”"
I wouldn’t bet on it. It may have been there at one time but it is highly debatable, generally speaking, that even half of what is promised is there now. The assumptions and underlying instruments are all tied to this whole debacle. Just like pretending that a house not foreclosed on is still worth its book value. Even after all the fraud, deception and just flat out misjudgements that have come to light we still have many companies, debt instruments, banks, 401K, retirement funds and all thing financials that base certain of their values on figments.
I know a few folks collecting federal and military pensions. When I ask them if they are worried about losing all or part of their pension they just laugh. Some of them (the military guys) are still in their 40’s.
I will resemble that remark in about two years. I see the retirement age rising to 25 years in the coming years. Staying 20 years in the military isnt easy, especially with a combat tour coming every other year in most cases. If you take away that 20 year retirement, I sumise you will lose alot of career military talent.
Step:
A better idea is you need to prove each year you are “retired” no w2 no wages then collect after 20 years, otherwise you can collect at 65…
Those laws were written many years ago when we assumed lots of people will die because of cigarette smoking…..well no smoking longer life.
I think people really underestimated what all the non smoking campaigns had on this problem
Actually, you are on the right track with your thinking, but not correct in you time-frame.
Pensions started under Kaiser Wilhelm to provide an “old age” benefit for people who lived to OLD age to live without struggling to support themselves. The age 65 was quite old, because the average age was about 49 when people died, typically. IN other words, most people would not collect anything.
Under Roosevelt, with SS paying old people the age 65 was kept, but most people were cashing it in much sooner, like 62.
Again, it was a support for OLD people so they wouldn’t have to work when they were old and frail.
It is no longer an Old AGE benefit. It has morphed into an entitlement of having been employed or lived in this country for a number of years, and includes all kinds of ridiculous benefits to children and dependents.
The biggest problem America faces is pension and benefit promises it has made to people that it can’t possibly support.
ANY program that allows a person to collect a LIFETIME payment of benefits, after 20 years of employment, is INSANE and should be terminated immediately.
Those currently collecting should be taxed till the government gets most of the money back, and the receiver of this “benefit” should be going back to work until age 70, unless they have produced enough savings to sit on their ass for the next 30 years.
This madness, that governments can promise “other peoples” money to parasites as benefits is what is creating all the failures we are now witnessing in all levels of society.
I read just yesterday about a crooked cop from New York who was collecting a $54,000 annual “disability” retirement because he was permanently “disabled”. He has been collecting for 10 years and is age 54. He currently is competing in 3 “IRONMAN” contests each year in different parts of the world. Stories like this abound in Government service employees.
I worked at the Post Office for a while. One parasite there said he hurt his back and got a disability pension. He immediately bought a new sportscar and spent his time drinking and dancing. Unfortunately for him, although the doctors said he was “disabled”, investigators had photos of the dancing and drinking and yardwork, so they filed a fraud claim and won. I don’t know if they ever got any of the money back.
I read about this every day. It is depressing that we have become a nation of “leisure”, paid for by future promises of other people’s labor. I needs to end now, and I guess a full blown depression and massive defaults is the only way to let people know that there is NO FREE LUNCH, and the working 20 years does not entitle you to anything. I have been working over 40 and don’t get any benefits for my time and trouble. What makes “government” employees so special??
I know someone who got disability retirement from the USFS years ago. Basically she got all uptight when her office moved to a more computerized system…she has to see a shrink once every 3 months but otherwise she has a pretty good time just hacking around.
Diogenes , if you think that is the typical retiree, you really should get out more often.
Most are not making fat bank. They are living lives of decent and quite middle class lifestyles.
my examples of fraud and abuse were not intended to be citing “typical retirees”.
My point is that the entire concept or “retiree” is a way outside of what was intended. NO ONE should retire with a pension at ages less than 70 or more, unless they have personally set aside the money to do so, by working and saving.
The ability of other working people to support them is limited and is being taxed to the limits of survivability right now.
You think people should have middle class, comfortable lifestyles for working 20 years of their life? It’s really an outrageous concept, well beyond any reasonable person’s sense of fairness or justice. It’s simply middle-aged people living off of current and future workers. It’s stealing. Plain and simple.
With “public union” employees, i call it what it is, extortion.
Public Unions benefit programs need to be scrapped and they can set aside funds for their “retirement” , just like the rest of us, with an IRA or 401K or whatever legal method we devise to save for “retirement”.
I am also singling out Public Union pensions, i.e. one’s paid for by taxpayers, at ALL levels of government. They are far too generous and they don’t get voted on by the taxpayers.
they are negotiated by the UNION with the current administrations, usually anticipating ever expanding “funds” to tap for future payouts. Most are insolvent, and need more tax money. They will never be solvent. There isn’t enough money in the world, no matter how much the FED prints. The promises made by past governments can never be met.
And yet, the unions want MORE, and the country is broke.
I want anti=trust legislation written to break up public sector unions. they should never have existed in the first place.
Let me know when you get to be 70 just how healthy and energetic you feel.
I got news for you. Health wise, the average person is good to about age 50. After that, it’s all downhill except for the rare exceptions.
Ever wondered why you don’t see a lot 60 yos working in factories or doing construction or being mechanics or pretty much anything that requires constant physical exertion? It’s because they CAN’T.
Secondly, why the hell should anyone work to age 70 to make some else rich?
Diogenes, it would be nice if one could work and save for their retirement, but is that really possible anymore? There’s a war on savers at the moment, don’t you know? College loans are outrageous, children are expensive, health care is still too expensive, we all know about housing, and even if you do manage to stack up some money, you can’t get a decent return on it.
While all you say is true, the reasons for these conditions is primarily government overspending and creating the need to “monetize” the debts. Government pensions and benefits, along with “entitlements” are the primary reasons.
The US government is unable to continue its “promises” to countless souls who want a handout. It’s long past time that we recognize this and stop trying to pass the problem onto the next generation.
“If you are a person that is on the wrong end of destroyed debt then you are a person that is out some money.”
Does this dictum apply to folks who work for too-big-to-fail Megabanks? For instance, where did those huge bailouts come from in 2009 after the near-collapse of the financial system in Fall 2008?
Highly recommended for anyone craving a massive dose of debt destruction Schadenfreude: Purchase a copy of last week’s Economist magazine and pour over the centerfold 14-page special report on debt. Your money will be well-spent!
A special report on debt
- Repent at leisure
- Paradise foreclosed
- The morning after
- Betting the balance-sheet
- A better bust?
- The unkindest cuts
- Judging the judges
- In a hole
- Sources and acknowledgments
Haha.
I remember when the Economist used to drone on and on about the impending “Fall of America”. America, you see, was engaging in really dreadful lending practices and, unlike the rest of the world, was going to get its comeupance someday, and someday soon. Well, they got 1/2 of it right, anyway.
“…they got 1/2 of it right, anyway.”
Gulp.
Biden: We Can’t Recover All the Jobs Lost. CBS News.
Vice President Joe Biden gave a stark assessment of the economy today, telling an audience of supporters, “there’s no possibility to restore 8 million jobs lost in the Great Recession.”
Now Plugs Bite-Me can’t have it both ways, just 2 weeks ago he and Barry stated that their “jobs creation” was working and we were well in the way to a solid recovery.
wmbz, do you have a link for this? I’d like to see if Biden went on to offer any solutions. But no matter; Biden probably just lost a lot of Dems their jobs. The rich-people media will just put this soundbyte on loop and hammer how the Dems can’t fix anything. Well, fine, let’s put sister Sarah in charge, and she can pray those jobs back — with her trusty PalmPromtper, of course.
At this point, the only solution I see is for a huge default on personal debt and the resulting deflation. Or perhaps a huge default and forgiveness of banking debt, with the hook of heavy regulation that basically reduces banks to checking accounts and car loans. When expenses come down, then women* can exit the workforce, simply the opposite of how they entered it 30 years ago. Shrink the labor pool, have more people to babysit the kiddies during the day. That would do wonders for the economy and morale. But of course, it will never happen, not in the face of globalization or Elizabeth Warren’s Two Income Trap, which will always be with us.
We can’t put the genie back into the bottle.
———–
*Doesn’t have to women specifically, just whichever spouse makes less money.
http://www.cbsnews.com/8301-503544_162-20008924-503544.html
Here’s a link:
http://www.cbsnews.com/8301-503544_162-20008924-503544.html
The link (to CBS) is top center of the drudge report.
The way the tax system is structured, 100 2-income families at $150K per family pay many times as much federal income tax as 200 1-income families at $75K. So the government has a huge incentive to keep those 2nd earners in the workforce.
About that genie; homes used to be quite the industry when we were an agrarian society. There was a lot of work to be done by all. in this society, what is there productive for a wife (or stay at home husband) to do other than monitor children?
“Monitor[ing] children” can take quite a bit of time if you also consider yourself responsible for some of their education. Also if most/all the food is prepared in the home there is significant time involved with that plus cleanup. Then if there are little extras like clothing repair and that sort of thing going on, it’s a full time job. When done by someone who enjoys it and does it well, it can make the home a really nice place for everyone to be.
There’s the misunderstanding. Children in daycare are “monitored”. Children with their families are “raised”. Raising children is valuable and harrowing.
Appreciate the props.
+1. Dumping your children off in Kiddie Kennels is a sorry substitute for raising them. America’s national shame is that parents don’t love their kids enough to bring them up properly and give them the care, attention, and discipline they need and deserve.
I dunno, some parents seem to just monitor.
America’s nation shame is that parents can’t AFFORD to stay home with their kids.
And while the neocons blame the libs for the decline of morals,(delivered by corporate MSM) it’s actually been neocon economic policy that has created this problem.
The oldest game in the book of power is to keep your populace off balance and insecure and then claim to have the solution.
America’s nation shame is that parents can’t AFFORD to stay home with their kids.
Agreed, although in too many cases they can’t “afford” to because of misplaced priorities and living beyond their means.
The most wonderful thing that happened to us was when we woke up and decided that my wife working part-time wasn’t worth the extra $. Our stress levels are down, our kids have done much better with school and are very happy that Mom is around whenever they need her. No paycheck would replace what it has done for our marriage and our family for her to stay home.
Personal button: “neocon” = “new conservative” = liberal convert to conservatism, minus some of the traditional conservative props. Well-documented term, initially.
Somewhere along the way, it started getting used as an epithet, apparently to apply to what I’ve heard referred to as “paleo-cons”, but in truth used to anyone espousing any conservative positions, even if they had other stances more in line with liberal philosophy. (Don’t get me started on meaning drift of “liberal.”)
My beef is that the term has been slung about with such abandon that it no longer has any solid meaning, and is very unclear. One group will apply it to XYZ politicians, and another will apply it to TUV politicians, and the two groups have only the most tenuous of connections in views.
In other words, it’s imprecise. And I dislike imprecision in language. The result of having an engineer for a father, I suppose.
–
As to your comment that Americans can’t afford to stay home with their kids, I sort of agree, but only in that the public THINKS they can’t afford it. It’s affordable; you just have to sacrifice and plan.
“When expenses come down, then women* can exit the workforce, simply the opposite of how they entered it 30 years ago. Shrink the labor pool, have more people to babysit the kiddies during the day. That would do wonders for the economy and morale….*Doesn’t have to women specifically, just whichever spouse makes less money.”
The majority of women are single, divorced, or widowed so not sure what kind of “wonders” that will do for the economy or morale.
So much for the unemployed getting off their lazy butts and just taking one of these “plentiful” $10/hr jobs.
The farmers are hiring here in California — crop pickers — may not get even minimum wage, but they would have a job………………….LOL
“Biden: We Can’t Recover All the Jobs Lost. CBS News.”
Bwahahahahaha! Whatever happened to “Yes, we can!”?
This is the can’t-doingest. administration. ever. Can’t restore jobs, can’t clean up the housing mess, can’t secure the border, can’t handle the illegal problem, can’t handle Afghanistan, can’t enforce the laws, can’t handle the spill, can’t handle the banksters, can’t, can’t can’t.
But when it comes to attacking its own citizens, like declaring war on Arizona, YES, WE CAN!
Yes we can was the lie.
No we can’t is the truth.
Actually I am loving the truth. No matter who is elected, US in current state is ungovernable. Let’s accept it we are more of a failed state than Iraq ever was.
The previous administration was so much better at these things.
Amen brother!
So, why does everybody keep complaining about Obama? He said in his inaugural speech that we were headed for a serious recession, and that he would not be able to stop it. Now his Veep is being honest, and you still keep whining about it?
It’s up to the voters to solve this problem. Just vote for an end to globalization, instead of crabbing every time Obama places a tariff on tires. It’s in the works now, but will take awhile.
I suspect the people are complaining about Obama because he promised his policies would drop unemployment to 8% by the end of 2009. Well he broke that one. And not once but several times his lap dog Biden was proclaiming the stimulus is working. And now we get this news from Biden - “We can’t recover the jobs lost.”
So now you like Biden because he’s honest for this time?
At least Ronald Reagan was out front about his admiration for socialist FDR. He said that over and over. He also said over and over that his policies are not to CUT spending, but cut the rate of increase in spending. RR was far more honest than the current occupying regime. And no I didn’t vote for RR. I was a radical libertarian back then and am a radical liberal (in the Frederic Bastiat sense) now.
RR was far more honest than the current occupying regime.
Except for all that arms-for-hostages stuff. And the still-standing record number of indictments, investigations, and convictions of officials in his administration.
At least there were some convictions. What’s your take on all the tax cheats currently in high positions? How come they’re aren’t convicted of anything? Maybe it’s that double-standard I’ve heard about that makes RR the current winner.
By the way, I don’t doubt it by any means, but can you cite a reference for RR having the record number?
dir.salon.com/story/opinion/conason/2004/06/08/reagan/index.html
Does impeaching someone for lying about an affair fall under the ‘double standard’? Apparently it was a far greater danger to the republic than secretly trading arms to an enemy regime. Was that the double standard you heard about?
RR was a liar just like any other politician.
But, come on Joe Conason? This guy is one intellectually dishonest left wing ideologue. You can do better than that.
Was that the double standard you heard about?
No. Look closer. I was specifically talking about the tax cheats in high positions. You forgot to tell me what your take on that was. Instead you continued talking about RR and then apparently brought up Clinton in an attempt to prove there isn’t a double standard. As far as the double standard and how it relates to Clinton, I think if Clinton had been a republican he would have been out of office. I still hear about how stupid Dan Quayle was with respect to potatoes and stuff. I don’t seem to see the press going on and on about “corpse” man.
Do you really think failing to pay the proper amount of social security withholding tax is comparable to secretly trading arms to an enemy regime? (I’m not aware who the other ‘tax cheats in high positions’ are, other than Geithner.)
Try this link, sloth:
http://tinyurl.com/2apg74c
Which of these various people have been prosecuted? I guess when they pay all their fines it’s okay?
I still can’t find any other people in high positions in the admin who have cheated on their taxes. Perhaps you’re misunderstanding what ‘nominee’ means?
He promised no such thing. It was a projection of his stimulus plan. A plan that has been opposed or compromised every step of the way by the Repubs.
IMHO, it’s up to EMPLOYERS to solve this problem. Run a credit and public-records search on any potential hire and don’t hire anyone who bought a house he couldn’t pay for.
This way, the problem will be contained and the innocent will be affected less.
OH yeah sure reuven
then when there are no qualified clean credit Americans, we can get the big OH to massively increase HB1 visas and allow foreigners to take jobs Americans will never be qualified for.
I hear they now have an opening for a General. Ass-kissing and Afghan-battle-theater-leadership skills helpful.
Funny.
I was very surprised to read that McChristal was Obama voting, fox hatin’, soically progressive military leader. I thought he was one of the cowboys types.
I love to see so called leaders hoisted with their own petard.
I’m guessing that being an Obama voting, Fox hatin’ socially progressive military leader were the key prerequisites for promotion to the slot he was filling. Certainly not integrity, as he showed with the Pat Tilman “friendly fire” cover-up.
I hear they now have an opening for a General. Ass-kissing and Afghan-battle-theater-leadership skills helpful.
All generals have the first part covered or they wouldn’t be generals.
You do now the Pres is Commander in Chief, right? As in, the boss of generals and admirals?
Yes, and Obama did the right thing - and the necessary thing - by canning McChrystal for the comments made by him and his staff.
Under what rock do these thousands of anarchists live? It is as though they spontaneously materialize when the G-20 or the WTO schedule an international meeting.
And what message are they trying to send by smashing coffee shop windows, looting retail outlets and such? At whom is their anger directed, and how does punishing local property owners satisfy their rage?
I find the whole scenario beyond bizarre.
G20 protesters riot in Toronto
Several hundred masked anarchists break away from peaceful demonstration to smash storefronts and torch police cars
In pictures: G20 protests in Toronto
* Mark Tran and agencies
* guardian.co.uk, Sunday 27 June 2010 12.06 BST
A protester kicks a burning police car in Toronto.
Photograph: Ryan Remiorz/AP
Toronto was today counting the cost of rioting as a group of anarchists torched police cars and smashed storefronts close to the G20 summit.
Bill Blair, the city’s chief of police, admitted officers had struggled to control the crowds, who at times numbered several thousand. He said 75 people had been detained, including some he believed were ringleaders of the violence that lasted through the afternoon and evening, after several hundred masked protesters broke away from a larger, peaceful demonstration.
The roving band, wearing black balaclavas, shattered shop windows and rampaged through central Toronto. Protesters set fire to at least three police cruisers in different parts of the city, including one in the heart of the financial district. One protester jumped on to the roof of one before dropping a Molotov cocktail into the smashed windscreen.
Banks, coffee shops and small stores were targets, and protesters looted at least one retailer, storming out with clothing and the arms and legs of mannequins.
“A relatively small group of people … came clearly with the intent of damaging property and perpetrating violence,” the city mayor, David Miller, told a news conference. “They’re criminals that came to Toronto deliberately to break the law.”
…
“Under what rock do these thousands of anarchists live”?
I’ve often wondered where these malcontents come from. They show up destroy working folks property and claim that it’s all big businesses and governments fault. Where do they get their rent a mob funds? Bunch of worthless punks that should have their asses kicked, and I’d be happy to do it.
They really need to start holding those G20 meetings on a remote island, somewhere.
I mean that in the sense that no country is going to want to host G20 meetings anymore because the vandalism bills are always so high.
“They really need to start holding those G20 meetings on a remote island, somewhere.”
Maybe they can buy one from Greece?
Or perhaps Jekyll Island is available?
The probabililty of a seismic event might be elevated in Oakland California the next week or so
“Or perhaps Jekyll Island is available?”
Make it Alcatraz and throw in a special invite for the Fed.
Maybe have the banking summits at the headquarters of Goldman since they run the whole thing anyway. Maybe even have a fundraising “Smash a Goldmanwindow for charity” event. Charge $20 for each throw of a brick.
Well, we know where the bankers get their money and marching orders, dont we!
I used to donate to Global Exchange, a non-profit that worked for better working conditions, like anti-sweatshop and Fair Trade. These are noble ideals, but Global exchange is headed by Medea Benjamin, the activist extraordinaire who also heads up Code Pink, those folk who hold up the most annoying signs in the background at Congressional hearing and such.
I stopped donating to Global Exchange. I guess I ought to send them a note so they know why.
“A relatively small group of people … came clearly with the intent of damaging property and perpetrating violence,” the city mayor, David Miller, told a news conference. “They’re criminals that came to Toronto deliberately to break the law.”
Blah blah blah. Either be prepared to break their heads, or STFU.
The Black Bloc tactics used in Toronto are foretaste of things to come. The tactics are very effective because of the seeming randomness. The factions that split off from the main peaceful group had an agenda of chaos and vandalism targeting large global institutions such as banks, Starbucks, Mcdonalds and the like. Twitter and other social media aid in their planning and implementation. They all have cell phones and use them effectively.Over 400 are in detention as of this morning. It is the only story in Canada today, even though 2 more Canadian soldiers were killed yesterday.If the world plunges into a depression then this scenario can only repeat itself globally. The individuals who perpetrated this outrage have, sadly, become lionized by likeminded thugs the world over.
And the only remedy is to have a bigger gun or instrument of chaos.
In the end, nature’s laws will win over anything else. Control must be established. Whose control, is the big question.
“The tactics are very effective because of the seeming randomness.”
It seems to me about as random as Osama bin Laden’s exercise in crashing airplanes into the World Trade Center towers on 9/11/01. I hope law enforcement authorities figure out who orchestrated this anarchistic riot and extract a price from the ringleaders commensurate with the property destruction they have inflicted. Anarchy is incompatible with civilization and should not be tolerated.
Anarchy is fine by me until it crosses the line into criminal violence and destruction of property. Organized anarchist groups should be slapped with RICO prosecutions. Disagreeing with public policy is one thing - it’s a right. Using legitimate protests as an excuse for mayhem is indeed incompatible with civilized society and needs to be dealt with as such.
Over 400 are in detention as of this morning ??
If they come to my property and vandalize, they will never make it to detention…
They are terrorists, though. If the next summit is held in the US (or anywhere else where people have firearms), then I’m guessing more than a few shop owners are going to bring their guns to work. That will not be effective for the anarchy group.
That’s probably why they don’t hold them in the USA.
I think they live in those kiosks at the Mall. There’s no other explanation for those things.
Yes, who are these malcontent anarchists who seek to destroy the whole system and send us back to the days of barter and fending for yourself, without any government intrusion? Wherever could they get such outlandish ideas?
(’Hang ‘em high!’ shout the libertarians;-)
Nice try, but “anarchy” does NOT imply violence– it simply means the absence of a ruling élite.
In fact, the anarchist symbol– an O surrounding an A– implies that under conditions of true anarchy, spontaneous Order would result (O for Order), not riots or vandalism.
There you go!
“The Market for Liberty,” by Morris and Linda Tannehill
“The Machinery of Freedom,” by David Friedman
“For a New Liberty,” by Murray Rothbard
“Crisis Investing,” by Douglas Casey (there is a scenario of an anarcho-capitalist society somewhere in there).
“No Treason: The Constitution of No Authority,” by Lysander Spooner
Power loves a vacuum, and there’s always a Visigoth or Hun waiting to fill it.
The Anarchists that I know do not live under rocks. They have jobs from menial to professional or are self-employed; to go to a protest they use their sick/vacation days or just go. They like being their own boss but would not be boss of another.
They believe that silence is acquiescence and inaction denotes approval. They believe that no majority however large has the right to dictate to even a minority of one.
They are against all authority that they have not ceded willingly, and they reserve the right of secession from that authority.
The Anarchists that I know view damaging property as no violence; they reserve that term for damaging living things.
“Your damn laws, Judge; what good are they? Good people don’t need ‘em and bad people don’t obey ‘em.”
-Ammon Hennacy
“Your damn laws, Judge; what good are they? Good people don’t need ‘em and bad people don’t obey ‘em.”
-Ammon Hennacy ??
Interesting quote…
Juvenile sophistry.
How purile to believe that you can eliminate authority by destroying it. An immediate power vacuum is not likely to be filled by a system better than the status quo.
Remember, revolution is the circle of a lover’s hand. These kids are just ingrates who don’t know how to compromise.
Hmm, I can think of several examples from history where it did make a difference.
Something about WW2 comes to mind almost immediately.
Yeah, but it took the United Nations to, like, rebuild and stuff. Not a bunch of spoiled-brat kids who have no idea of how to deal with the actual fallout of anarchy.
Breaking up the Austro-Hungarian and Ottoman empires at the end of WWI turned out to be one of history’s great blunders. Leaving the German empire intact was another one.
“The balkanization of Southeastern Europe proceeded apace, with the consequent relative aggrandisement of Prussia and the German Reich, which, though tired and war-scarred, was intact and locally overwhelming. There is not one of the peoples of provinces that constituted the Empire of the Hapsburgs to whom gaining their independence has not brought the tortures which ancient poets and tholgians had reserved for the damned.”
- Winston S. Churchill
If I work for a year to save up enough money to buy a car, that car represents a year’s worth of my labor.
If someone comes and torches it, they have stolen a year’s worth of work from me. Stolen labor is the same as enslavement. The dictionary defines violence - I don’t need to redefine it. But destroying my property is like enslaving me.
I agree. The anarchism that I studied in those references I cited earlier is not the violent kind.
Ireland “suffered” (my sarcastic words) from anarchism for one thousand years in nonviolence, according to Murray Rothbard in “For a New Liberty.”
I believe most of the working class agrees with you.
If someone comes and torches it, they have stolen a year’s worth of work from me. Stolen labor is the same as enslavement.
Excellent point. Fortunately, the rioters seem to have been a small minority of the protesters in Toronto.
The Anarchists that I know view damaging property as no violence; they reserve that term for damaging living things.
I’m guessing most of these “anarchists” have pampered middle class upbringing and have never built or fixed anything in their entire lives. True working class people are appalled by the mindless destruction of useful things or property. You don’t think its damaging for “living things” a.k.a. entrepreneurs and their employees, to get their places of business smashed up? I’m sure the anarchists who burned to death those three female tellers trapped in the building they firebombed in Greece have spout some BS about “fighting the system” when all they are is scum who need to be dealt with as such.
Upper middle class upbringing and some trust fund babies.
Men mostly do it to get chicks, period.
Yeah, ’cause chicks are soooooo impressed by dudes who burn down other chicks.
Actually, some chicks do excuse all sorts of reprehensible behavior by men in service of the greater cause. See page 21 of the taped statement transcription of the masseuse who claims sexual assault by Al Gore in October 2006 (page 21):
“This is what’s been really hard with this. Um, because I, I, you know, I live in “The Birkenstock Tribe” and it’s like being the ultimate traitor. And by the by, there are people um, one who is so black and white Left wing, she ceased talking to me. Another one who was basically asking me to just suck it up, otherwise the world’s going to be destroyed from global warming. And I was like, these are women. I’m like, where is the feminist in you? What the hell? This is not okay”.
Oh you don’t know western chicks and their screwed up heads.
Butters:
What do you mean by “western”? Cause I’m from California.
Please do not attribute to me the views of the Anarchists that I know.
Butters: From what I’ve observed you are mistaken.
Where do they come from?
Marie Antoinette wondered the same thing.
Don’t get me wrong, the anarchists are stupid. But their numbers are a telling symptom of popular dissatisfaction.
Popular dissatisfaction is justified. Anarchic vandalism is not.
Bad Chile here, from the new home of the Chile’s in the Land of Enchantment.
Yesterday was a great day, besides the fact I had the pleasure of brewing a fine Special Bitter on a friend’s 1/2 bbl system; but there was a bank failure on Friday near our apartment. Saturday morning, while picking up some breakfast burritos for the brew session I decided to take a short detour and pass by one of the two branches of High Desert State Bank, now in the process of being handed over to another bank at FDIC expense (ok, us taxpayers really help banks pay those insurance fees).
This branch of HDSB is located in a newer part of town, with the requisite faux-New Mexican architecture, the faux old wagon parked in front, with the only thing real about the landscaping is the yucca and the dirt and the occasional roadrunner looking for lunch in the form of a rattlesnake. Oh, they got a little bit more real landscaping yesterday at 5.45am - a real live state trooper, parked in front. I decided to stop in front of the bank and take a quick photo, but as soon as I got out of the car so did Mr. State Trooper. Now, New Mexico state troopers have uniforms that make Massachusetts state troopers look like Boy Scouts and an attitude that makes Virginia state troopers look like Girl Scouts, and enforce the law in a haphazard way that would make an Arizona state trooper look fair when asking for an ID. So I quickly retreated into my car, hit the accelerator, and drove to the brew shack.
Later in the day the parking lot was jammed with the type of cars favored by those on government expense reports, I assume from
the FDIC. Mr. State Trooper was still there, so I avoided the scene even though I should have just pulled through the ATM to grab a photo. Oh well.
In honor of the day, the beer is now named “Special Bank Failure Friday Bitter”. Will let y’all know how it turns out.
No, name it “Big V Bitter”.
Otherwise known as Redundancy Brew.
What makes it bitter? An excess of hops? Not that there’s anything wrong with that.
A favorite of mine here in Boise is Tablerock’s Hopzilla.
http://www.ratebeer.com/beer/tablerock-hopzilla/21238/
Here is a better entry point to The Economist special report on debt which I referenced above:
The age of easy credit and its aftermath
Is there life after debt?
Rich countries borrowed from the future. Paying the bill will be difficult, and so will living in a thriftier world
Jun 24th 2010
DEBT is as powerful a drug as alcohol and nicotine. In boom times Western consumers used it to enhance their lifestyles, companies borrowed to expand their businesses and investors employed debt to enhance their returns. For as long as the boom lasted, Mr Micawber’s famous injunction appeared to be wrong: when annual expenditure exceeded income, the result was happiness, not misery.
For a long time debt in the rich world has grown faster than incomes. As our special report this week spells out, it is not just government deficits that have swelled. In America private-sector debt alone rose from around 50% of GDP in 1950 to nearly 300% at its recent peak. The origins of the boom go even further back, reflecting huge changes in social attitudes. In the 19th century defaulting borrowers were sent to prison. The generation that lived through the Great Depression learned to scrimp and save. But the wider take-up of credit cards in the 1960s created a “buy now, pay later” society. Default became just a lifestyle choice. The reckless lender, rather than the imprudent debtor, was likely to get the blame.
…
Trickle-down theory, intellectual edition:
Within two years, every citizen of Western civilization who is capable of either reading or watching an evening news broadcast will have grasped the lessons of this week’s Economist’s pornographic debt destruction Schadenfreude centerfold section. A paradigm-shifting meme has been unleashed on the masses, and it is only a matter of time before the diffusion runs its course.
I note that a similar information cascade following a December 2006 article on subprime ABX indexes most likely helped precipitate the catastrophic failure of the subprime lending sector in early 2007.
Implication for prospective U.S. home buyers:
DON’T BUY YET.
9.“In a nation ruled by swine, all pigs are upwardly mobile”
Hunter S. Thompson
Austerity or growth: Which is it going to be?
Growth sounds much more pleasant in principle, though if it involves more overbuilding of overpriced, unwanted, unneeded, vacant-on-completion McMansion tract homes, please leave me out of it.
Deficit reduction deal near at G20
Canadian Prime Minister Stephen Harper speaks during a business summit at the G20 Summit
REUTERS/Jim Young
Canadian Prime Minister Stephen Harper speaks during a business summit at the G20 Summit
Paul Vieira and David Pett , Financial Post · Saturday, Jun. 26, 2010
TORONTO — Fresh off one summit where he raised over US$7-billion from cash-strapped governments for his flagship maternal health initiative, Prime Minister Stephen Harper kicked off the crucial Group of 20 leaders meeting in Toronto Saturday night on the verge of clinching a key accord among his peers on deficit reduction.
Mr. Harper greeted his G20 counterparts in downtown Toronto, which was the scene of the week’s biggest and most violent demonstrations, with police cruisers set on fire.
Prior to leaving the resort town of Huntsville, Ont., at the end of the G8 summit, Mr. Harper was confident he could get his counterparts from developed and emerging economies to agree to his G20 goal of halving deficits by 2013, and bring their debt-to-GDP ratios to more sustainable levels by 2016.
“My sense is that there is a strong consensus around the necessity for mid-term plans on fiscal consolidation in advanced countries,” Mr. Harper said.
On this front, Mr. Harper has allies, such as José Manuel Barroso, president of the European Commission. In fact, Mr. Barroso told reporters that, at this moment, G20 leaders appear to be in comfortable with Canada’s targets.
“We expect the G20 to agree on concrete targets for deficit reduction. We need the targets to be credible and want them to be minimum targets,” Mr. Barroso said.
Going into the G20, the United States, the world’s biggest economy, appeared reluctant to embrace the austerity agenda. Barack Obama, the U.S. President, wants to make financial reform the key agenda item, after the U.S. Congress struck a deal to enact the most sweeping overhaul of financial rules since the Great Depression.
The U.S. Treasury Secretary, Timothy Geithner, told reporters in Toronto that the G20’s focus should be elsewhere.
“This summit must be fundamentally about growth. And our challenge, as the G20, is that we all need to act to strengthen the prospects for growth.”
His remarks emerged after first-quarter U.S. economic growth was revised downward, to 2.7%.
Nevertheless, should Mr. Harper get the G20 countries onside in terms of a pact on fiscal austerity, it could cap an impressive weekend for the Canadian leader.
Read more: http://www.financialpost.com/news/Failure+reach+deficit+deal+could+impact+world+economy+Canada/3206623/story.html#ixzz0s3ma3Z1q
Good thing someone wants to lead the world out of this mess.
Spending less is a good start.
What do Geithner and Obama know about growth? The only thing they’ve been able to grow if the size of the Fed Government and the corresponding Deficit.
“What do Geithner and Obama know about growth?…”
I think TTT should stick to tax dodging and accidental landlord seminars. That appears to be his specialty.
The chosen one should stick to eloquent and charismatic speech reading seminars.
Interesting that the rest of the developed world wants everyone, including the U.S. to enact austerity policies. Actually What Geithner nor Obama don’t get are that we cannot have real growth without going through austerity first, even if it takes twenty years of austerity.
They (the pro-austerity camp) say that they’re afraid of becoming the next Greece. I postulate that their real fear, however, is becoming the next Japan. Six months of crisis would no doubt test them, but two decades of utter stagnation would break them.
Florida homes were the craze in the 1920s, then prices crashed and didn’t fully recover until the ’40s. The current bust could be worse.
http://www.csmonitor.com/Money/The-Daily-Reckoning/2010/0622/Florida-homes-Will-luxury-real-estate-ever-rise-again
“History doesn’t repeat itself, but it does rhyme.”
— Mark Twain
The only thing that man learns from history is that man doesn’t learn from history.
We covered that bit of history on the HBB, during Get Stucco’s hey-day, to the point of near-exhaustion.
Ah, from reading that article, I now know the source of the names “Get Stucco” and “Palmetto!”
“South Florida is entering its fourth year of a property slump. Places sell for about half of what they brought three years ago. The retail building across the street is half empty. Signs are everywhere: “Office for rent.” “Ocean front lot for sale.” “Commercial space available.” Here in Delray Beach, the sun is shining. The grass is growing. Waves caress the shore. But our hotel is nearly empty. Many restaurants on Atlantic Avenue are closed. The streets are so quiet the city seems like a ghost town. Then again, it’s so hot and sweaty, even the ghosts wilt”.
Yet so many cling to the hope, that any month now, “it” will turn around. The majority of the people I know and talk to about our economy think that a big turn around will occur within the next year.
15183 N 84Th Av Palm Beach Gardens, FL 33418
$270,000 4 Bed, 2 Bath | 4,061 Sq Ft on 1.17 Acres | MLS #R2872040
Listing Information
Refreshed at 7:15 AM PT (less than 5 minutes ago)
Added on Nov 16, 2007 (953 days ago)
The Gulf spill situation is going to put the Florida housing downturd on steroids.
What happens when a black swan eats a tarball?
Palmy:
Pensacola beaches from a helicopter
http://www.youtube.com/watch?v=5fqu3beMcIw
“What happens when a black swan eats a tarball?”
First black swan tarball guano bombs happen, followed by black death.
I can tell you that the part about the Atlantic Ave restaurants and it being quiet is untrue. The few restaurants that went out of business have been reopened as something else. It may be slower because it’s really hot, but two months ago you couldn’t get a parking spot even during the week. I live very close to Atlantic Ave, and I think it’s better than ever. I think we’re getting the people that used to go to Cityplace in West Palm, or Las Olas in Fort Lauderdale.
“It may be slower because it’s really hot,”
I think there’s a lot of truth to that. Florida is always hot during the summer, but something’s different this summer, the heat has an abnormal quality to it. The really intense heat that we usually feel in August and September started in May, unrelieved by the storms that usually mitigate the effects of the heat. Even now we’re not getting the storms that we should.
So people tend to hibernate in the airconditioning.
When I lived in Florida September was my least favorite month.
By September summer was in its fifth month, the humidity was sky high, and daytime highs in the mid 90’s were relentless for those 5 months. And it was the peak of hurricane season.
I hate hurricanes.
Sign of the times:
I just dug through my dead tree copy of the San Diego Union Tribune Sunday edition to check for any post-worthy articles in the Homes section, only to realize the section has been eliminated from their format.
Needless to say, there is still a thick ‘homes for sale’ UHS advertisement section that comes with the paper…d
Geithner Urges spending vs. austerity
Treasury Secretary Timothy Geithner said in Toronto yesterday “We are still living with the deep scars of this crisis, and it’s going to take some time to heal those, so this summit must be fundamentally about growth. Our challenge as the G20 is to act together to strengthen the prospects for growth. This will require different strategies in different countries. We are coming out of this crisis at different speeds.”
Unfortunately for Geithner and the others in the G-20 contingent from the USA, other troubled nations are not all that eager to keep spending money they don’t have in the hope of re-inflating economic bubbles. Some nations, like Germany, are willing to face the music, slash spending where possible, and nibble away at burdensome deficits. The U.S. position is “Yeah, someday we must deal with unsustainable deficits, but not now. We must crank up the money printing presses and get the economy going again.”
The U.S. is in a disadvantaged position for embarking on a debt rehabilitation program relative to other nations which drank less Keynesian kool-aide over the past several decades. Hair-of-the-dog treatment would be far more pleasant for the U.S. citizenry to endure than some kind of twelve-step austerity program.
+1 on that quote…
I’ll drink to that!
(Reuters) - President Barack Obama, fresh from a win on a sweeping overhaul of Wall Street regulations, on Saturday urged Congress to take up his proposal for a $90 billion, 10-year tax on banks as the next step in reform.
Obama wants to slap a 0.15 percent tax on the liabilities of the biggest U.S. financial institutions to recoup the costs to taxpayers of the financial bailout.
“We need to impose a fee on the banks that were the biggest beneficiaries of taxpayer assistance at the height of our financial crisis — so we can recover every dime of taxpayer money,” Obama said in his weekly radio and Internet address.
“Obama wants to slap a 0.15 percent tax on the liabilities of the biggest U.S. financial institutions to recoup the costs to taxpayers of the financial bailout.”
I am so glad that the O has finally found a way to raise the cost of doing business without those costs being passed on to the consumer. Just like the upcoming fees, imo, targeted towards big oil to prevent another oil spill disaster. It’s reassuring to know it won’t affect few prices.
I am not a defender of the banks or big oil. Don’t misinterpret my sarcasm.
IMO, we have gone down the path of political correctness for so long now that reality is a secondary consideration. Up is down. Left is right. Little Johnny isn’t too bright? That’s ok, let’s give him a spelling bee trophy anyway. There are countless examples of this simple scenario in every facet our lives. Your a member of sub-group X? Here’s 10 bonus points for ya’. The world has always had ditch diggers and rocket scientists’. Not everyone can be a captain of industry, regardless of what the latest brain dead reality show is trying to tell you. It’s just the way it is. The sooner we wash away this charade of BS the better.
Social engineering eventually kills the organism.
Dude, what are you complaining about? He is going to make them pay the money back! Banks are not in the position to pass anything on to the consumer. Prices are determined by the market, not by the banking industry’s desire to maintain profits.
Give ‘em money, complain. Don’t give ‘em money, complain.
I just felt like complaining.
“Obama wants to slap a 0.15 percent tax on the liabilities of the biggest U.S. financial institutions to recoup the costs to taxpayers of the financial bailout.”
Which the banks will promptly pass on to consumers. Duh.
You want to do taxpayers a favor, Obama? STOP THE BAILOUTS!
Exactly.
I mean do they not know how backward their policies are?
First bail out the banks by using tacpayers’ money and then recoup it by charging fees which will also be paid by the customers (or the taxpayers).
I know it’s different in Canada because they are smarter than we are here in the U.S. Just wondering how this will end?
Vancouver’s Real Estate Bubble Trouble
Brokers are rock stars, cabbies flip condos, and shacks are going for $1 million. BW Magazine
(This story has been corrected to say that the standard for mortgage loans in Canada is being tightened from 40 years to 35 years.)
The Olympics are over, and the Village is for sale. The complex in Vancouver, British Columbia, that housed the athletes during the 2010 Winter Olympics has been converted into 1,100 luxury condos. About 450 have been pre-sold, and the sales of the remainder may well render a verdict on a mystery that looms over this city like Grouse Mountain: Did Canada prudently steer its way clear of the worst of the financial crisis only to be rewarded with a massive housing bubble of its own?
http://www.businessweek.com/magazine/content/10_27/b4185064551500.htm
There houses in Toronto, 800-900 sq. ft. selling for $650000, being demolished and replaced with McMansions. 650k for a city lot in other words.
more than 650K for the lot. it will cost this guys at least another 100K for demolition plus debris hauling.
Obama Internet kill switch plan approved by US Senate.
President could get power to turn off Internet. ~ Tech World
A US Senate committee has approved a wide-ranging cybersecurity bill that some critics have suggested would give the US president the authority to shut down parts of the Internet during a cyberattack.
Senator Joe Lieberman and other bill sponsors have refuted the charges that the Protecting Cyberspace as a National Asset Act gives the president an Internet “kill switch.” Instead, the bill puts limits on the powers the president already has to cause “the closing of any facility or stations for wire communication” in a time of war, as described in the Communications Act of 1934, they said in a breakdown of the bill published on the Senate Homeland Security and Governmental Affairs Committee website.
“Senator Joe Lieberman”
Figures. Neocon warmonger.
Correction: Neocon war monger spy for the nationalist, lying, theiving murderous israeli government.
I’m guessing the Internet billing departments of the TBTF banks and the HFT trading desks will be unaffected.
Now why would you think a thing like that?
Priorities.
There is a big religious debate now playing out in the MSM over the morality of walking away from a mortgage.
This is quite fascinating, especially since nobody seems much concerned about the morality of lenders who offered loans in sizes that were unlikely to ever be repaid. It’s almost as though the MSM pretends that lenders (esp. Megabank, Inc) had no role whatever in creating this mess! It takes two to screw a FB.
Is it right to walk away from a mortgage?
By AMY GREEN
Religion News Service
June 25, 2010 08:47PM
Orlando, Fla • Lynn Thompson quit paying the mortgage on her investment property — not because she couldn’t afford the payments, but because she sees walking away as better for her long-term financial health.
Thompson bought the property here for $175,000 in January 2007, just as the housing market began sliding. At the time, she planned to rent the house and eventually sell it for a profit.
Today, she estimates the house is worth $85,000, maybe less.
Unable to find renters to help cover the mortgage, she tried to persuade her lender to allow a “short sale” — selling below the loan amount, with the lender forgiving the balance. When the lender declined, Thompson opted to walk away.
“I would have basically no money left every month if I made the payments,” said Thompson, a single 39-year-old pharmacist. “If I tried to sell the house in, say, 10 years from now, I still would have to come up probably with, say, $75,000.”
Desperate homeowners such as Thompson have raised an ethical debate: Is it ever OK to walk away?
Nationwide, up to 25 million homeowners — about one in four — are “underwater”: like Thompson, their mortgages are worth more than their homes. Those who do walk away face an array of financial consequences, from damaged credit to the prospect of a lender suing to recover the balance. Yet, for many, the question is a moral one. Is it the right thing to do?
It’s unclear how many homeowners, like Thompson, are opting for strategic defaults — allowing their homes to go into foreclosure even when they can make the payments. Many feel their homes are decades away from regaining value and see no other options.
But, especially in hard-hit places, the question is nagging at more homeowners, and the number of strategic defaults appears to be rising.
Strategic defaults accounted for 31 percent of all defaults in March, up from 22 percent the year before, according to an April report by Paola Sapienza of Northwestern University and Luigi Zingales of the University of Chicago.
That doesn’t mean homeowners are walking away without feeling like they violated some ethical or moral code about not buying something they cannot afford. Some are left with a deep sense of debtor’s shame.
Brent White, a law professor at the University of Arizona whose writings include The Morality of Strategic Default, said more than 80 percent of homeowners still view defaulting on a mortgage as immoral. Those who do it, he added, usually make the decision not for financial reasons but emotional ones.
In other words, it takes more than a dismal financial reality to push homeowners to default. Underwater homeowners, he said, often feel angry, depressed or hopeless.
“People walk away because they’re angry at their lenders,” he said. “They have been unable to work with them, and the government hasn’t done anything to help underwater homeowners who are trying to make their mortgage payments. If people were acting purely on a rational basis, they would walk away much sooner than they do.”
…
Here is another story from today’s Chicago Tribune along those same lines. Sounds like this guy spent everything he had trying to save his condo, however, and he is now living mortgage-free, but still paying the association fees (got to hand it to him for not screwing over his neighbors).
www chicagotribune dot com/classified/realestate/ct-biz-0627-bankrupt-homeowner–20100626,0,444826.story
Bargains galore!
“An historic ranch in Kelly is slated for auction in mid-July, with a starting bid of just $15 million, down from $47 million sought a year ago.”
http://www.jhnewsandguide.com/article.php?art_id=6104
Nice to see the Enron folks are still doing well…
“Lewis would not disclose the property owner’s name, but Teton County records show that Lou Pai was involved with subdividing the property and granting conservation easements on portions.
Pai began working for Enron in 1986 and resigned from the company six months before it filed for bankruptcy protection, according to The New York Times.
He left the company with $271 million, the Times reported. He paid the Securities and Exchange Commission a $31.5 million fine and settlement over insider-trading charges, The Atlantic reported.”
This sounds like a very quick way for Megabank, Inc to build up its REO inventory in an inconspicuous manner which helps to keep said inventory in the shadows.
But once they build it up, what then? Won’t this effectively put them in the position of holding a huge falling knife foreclosure home liability on their balance sheets?
I suppose so long as the firms involved are too-big-to-fail, i.e., backed by the full faith and credit of the U.S. tax base, there is no serious downside risk.
Foreclosure alternative gaining favor
By Kenneth R. Harney
Saturday, June 26, 2010
Short sales have been the hot solution for financially stressed homeowners and their lenders for the past year, but here’s another potent foreclosure alternative that’s about to take center stage: deeds in lieu.
Some of the largest mortgage servicers and lenders in the country are gearing up campaigns to reach out to carefully targeted borrowers with cash incentives that sometimes range into five figures, plus a simple message: Let’s bypass the time-consuming hassles of short sales and foreclosures. Just deed us the title to your underwater home, and we’ll call it a deal. We won’t come after you to collect any deficiency between what you owe us on the mortgage and what we obtain from the home sale. We might even be able to wrap up the whole transaction in as little as 30 to 45 days. How about it?
Mortgage companies say troubled borrowers are increasingly signing up. One of the largest servicers, Bank of America, has mailed 100,000 deed-in-lieu solicitations to customers in the past 60 days, and its volume of completed transactions is breaking company records, according to officials.
What are deeds in lieu? The full name is deeds in lieu of foreclosure. They are voluntary transfers of property ownership from borrowers to creditors that make court-directed foreclosures unnecessary.
The concept is one of the oldest in real estate, but it got a special boost this year when the Obama administration included it as an option in its Home Affordable Foreclosure Alternatives program, and mortgage giant Fannie Mae cut the penalty-box time for homeowners who use the technique from four years to two before they can qualify for another home mortgage.
Deeds in lieu also are surging because they provide a win-win for borrowers and mortgage investors that short sales often cannot match. Tops on the list: speed. Travis Hamel Olsen, chief operating officer of Loan Resolution, a Scottsdale, Ariz., firm that works with lenders to solve troubled borrowers’ problems, said deeds in lieu represent “a very expeditious way to move on” for underwater borrowers who are facing potential foreclosure.
“A lot of owners just want to be finished with it now,” he said. “They don’t want to deal with [the house] anymore.” They don’t want to deal with real estate agents or signs on the front lawn that reveal their financial squeeze to neighbors. They don’t want to haggle with potential buyers coming in with lowball offers. But they also don’t want to simply walk away — strategically default — because that will crater their credit files and scores for as much as seven years.
…
This sounds promising as “short sales” haven’t been successful at anything, other than jamming up the pipeline for houses that need to be sold.
Has anyone ever heard of a short sale getting done in a reasonable amount of time?
From what I’ve seen, the people try a short sale, it fails, they move on.
Three of these that I know bought other houses while they were in the process of walking away from their other house. Two of the sellers were new home builders, who have inventory to sell and the ability to get the financing arranged.
Trouble with deeds in lieu: They don’t wipe out junior liens, so this strategy is only good when there is no second mortgage (d’oh).
That’s good to hear, as few Californian FBs are likely to be helped in that case.
I’m getting a little cognitive dissonance between this quote and your sentiments expressed directly below about your poor friends being forced out of their home by a heartless bank. Does it make a difference in your philosophy when you know the people involved?
In a similar heartless maneuver to the case described below, Megabank of America kicked out our friends (couple w/ 3 young kids) from their home and put it up for auction earlier this year. If only Megabank of America had been allowed to collapse in Fall 2008, and carved up like a big fat turkey into smaller, competitive, non-systemically-risky pieces, they would not be playing hardball today with struggling Main Street households.
Banks can relieve mortgage crisis by giving homeowners a break
With foreclosure rates at unprecedented levels, it may be time for banks to stop applying one-size-fits-all policies and work with homeowners to keep them in their homes.
June 25, 2010|David Lazarus
* Irfan Khan, Los Angeles Times
At what point do banks finally throw in the towel and accept that they’ve got to reduce people’s mortgages if they want to ease the foreclosure crisis?
A record 1 out of every 10 homeowners nationwide was at least 90 days behind on home payments during the first three months of the year, up from 1 in 14 a year ago, according to the Mortgage Bankers Assn.
The Inland Empire remains especially hard hit. In May, 1 in 106 homes had a foreclosure filing on it, according to market research firm RealtyTrac. A separate study by CoreLogic found that nearly 18% of homes in the area were at least 90 days late on mortgage payments in March.
And then there’s the case of Charisse Hogan, whose Fontana house is so far underwater, the amount owed — about $450,000 on two loans — is nearly three times what local real estate agents say the home is now worth.
Hogan, 41, is in a unique situation. The three-bedroom house is only in her husband’s name. When he died in an auto accident in December 2008, she inherited none of his mortgage obligations.
She could walk away at any time, no harm, no foul, and leave the mortgage lender, Bank of America, holding the bag.
But Hogan doesn’t want to do that. She wants to stay in the house, keep her family rooted, leave the property one day to her two kids. She just wants a mortgage that reflects the home’s actual value, which comparable properties in the area indicate is about $175,000.
Has BofA even been willing to haggle? Apparently not. The bank alerted Hogan recently that it planned to place the home up for auction July 6.
“It makes no sense,” said Richard Ball, a retired Calabasas businessman who heard about Hogan’s situation from a friend and has been trying to help work out a deal with the bank.
“They want to toss out someone who wants to live there and wants to make monthly payments at market value,” he said. “And instead of letting her do that, they want to sell it to someone else for about the same amount of money as she wants to pay — if they can.”
This is a tricky landscape, I know. There are many people in Southern California and elsewhere who got in over their heads through reckless behavior or irresponsible decisions, and it’s unfair to reward them by giving them a break on their loans.
…
Have these people still not figured out that they need to contest true ownership of the house?
Chances are the banks sold off and don’t even hold the liens anymore!
She just wants a mortgage that reflects the home’s actual value, which comparable properties in the area indicate is about $175,000.
Sure, and if the price would have appreciated in value, as this FB no doubt assumed it would when she signed the mortgage, she would have split her good fortune with the bank out of a sense of moral obligation.
She gambled, she lost. Boo hoo. Has any MSM “journalist” ever called these FBs out on their self-serving rationalizations?
Warren: “What is an appropriate metric for HAMP success?”
TTT: “Blah, blah, blah…”
Shahien Nasiripour | HuffPost Reporting
Bailout Watchdog Criticizes Geithner Over Obama Housing Plan
First Posted: 06-22-10 03:01 PM | Updated: 06-22-10 08:42 PM
The panel created to keep tabs on the federal bailout grilled Treasury Secretary Timothy Geithner on Tuesday over the lackluster performance of the administration’s signature foreclosure-prevention plan, expressing doubt about whether the $75 billion program will meet its Congressional mandate of helping families keep their homes.
The five-member bipartisan panel, led by Harvard Law professor Elizabeth Warren, delivered harsh criticism of the Obama administration’s program to modify the mortgages of distressed borrowers. Known as the Home Affordable Modification Program, or HAMP, the plan promised to help three to four million homeowners avoid foreclosure through lower monthly payments.
But 16 months after President Barack Obama announced his plan to help struggling homeowners, the program is stalling. Nearly 436,000 borrowers have been kicked out of the program while just 340,000 have received permanent relief.
Last month, about 155,000 homeowners were bounced from the program versus about 30,000 who were offered new temporary trial plans.
Citing the data, the panelists demanded to know how Treasury defined “success,” whether Treasury would change its approach considering the poor results, and whether the administration plans to devote more resources to helping families.
Geithner, though he acknowledged mistakes and lamented the “terrible job” performed by mortgage servicers, declined to say whether the administration would ramp up its assistance, citing “scarce resources.” The Troubled Asset Relief Program (TARP), the government’s main financial rescue program, is scheduled to end this October. Geithner said the administration doesn’t anticipate extending the program or spending any more money than has already been allotted.
About three million homes will receive foreclosure notices this year, estimates real estate research firm RealtyTrac. More than one million of them will be repossessed by lenders.
“We only have three months left with hundreds of thousands of families facing foreclosure,” Warren told Geithner. “Is it time to rethink whether or not a mortgage foreclosure prevention program that is based on a group of servicers whom you describe as having done a ‘terrible job’ is a program that perhaps should be redesigned?”
“I will never stand before this body, or any other body, and over-claim for what this program is delivering,” Geithner responded in a tacit acknowledgment of HAMP’s shortcomings.
…
WATCH Elizabeth Warren’s exchange with Tim Geithner: (++++++)
This is one place where I disagree with Elizabeth Warren. In her interviews, she stresses that homeowners need to be helped. But, IMO, few of these people deserve the help. First-time subprime buyers, sure. Lose the job, okay. But anyone who traded up or refi’d should have known better, and I don’t think the government should help them out, either directly with programs, or indirectly by bailing out the banks. I would recommend some kind of mild BK, where the FB can declare BK, only with less of a credit hit. Or perhaps make their recourse loans non-recourse in exchange for a BK — I’m sure they could come up with some compromise. Of course the banks, who “own” the Senate, would never stand for that.
“But anyone who traded up or refi’d should have known better, and I don’t think the government should help them out, either directly with programs, or indirectly by bailing out the banks.”
Totally agree.
But you have to admit that it was fun to watch the video of her pin TTT to the wall on the lack of ‘metrics’ for HAMP success.
“TTT: “Blah, blah, blah…”
That’s my fantasy idea for protest heckling. Crowd of hundreds, thousands of people solemnly assembled as if ready to hear the pearls of wisdom from some effete who wants to tell us how it’s gonna be. Instead of screaming, heckling and rock-throwing, the minute the effette begins his or her speech, the masses start droning “Blah, blah, blah” and continue until either the speech is ended or the effete gives up in frustration.
(adj) decadent, effete (marked by excessive self-indulgence and moral decay) “a decadent life of excessive money and no sense of responsibility”; “a group of effete self-professed intellectuals”
I’ve replaced the word “elite” with “effete”, making a noun out of it.
I thought it was nattering nabobs of negativism.
I love it!
LOL!
In one of the former Soviet Republics (Georgia, I think) a huge, silent crowd surrounded the equivalent of the White House, holding up signs that said one word: resign. Simple and powerful.
“Crony capitalism reigns US economy” PressTv.
A prominent US economic and banking expert has portrayed a grim outlook for the world’s most powerful economy, saying the “crony capitalism” runs rampant in the US.
Writing in the Wall Street Journal, Gerald O’Driscoll, the former director of the Center for International Trade and Economics at the Heritage Foundation believes that a growing tide of fraud and corruption has surged in the current US financial system that is on the verge of becoming “an economy of liars” run by crony capitalists.
In the wake of a bruising financial turmoil in the US, including a sub-prime mortgage crisis in 2009, many experts have persistently called for root and branch financial reforms in the US Congress.
These days, people might think that US is reeling from financial straits and that the worst is behind them, but pundits predict the next mortgage crisis is on the horizon.
According to O`Driscoll, who has been a vice president at the Federal Reserve Bank of Dallas, “free markets depend on truth telling… but in the US today, we are moving away from reliance on honest pricing. The federal government controls 90% of housing finance. Policies to encourage home ownership remain on the books.”
“The federal government controls 90% of housing finance. Policies to encourage home ownership remain on the books.”
What a surprise!
‘…a growing tide of fraud and corruption has surged in the current US financial system that is on the verge of becoming “an economy of liars” run by crony capitalists.’
More surprises here than you can shake a stick at! But don’t worry — now that financial reform legislation has passed, I am sure all the fraud and corruption will soon be rooted out of the system…
“…on the verge of becoming “an economy of liars” run by crony capitalists.”
On the verge of? That would be like being almost pregnant, wouldn’t it?
Drill baby, drill…
Libya going ahead with BP drilling deal
Associated Press 06.27.10
TRIPOLI, Libya — Libya will allow BP to begin drilling in its offshore deepwater region next month, despite the massive Gulf of Mexico oil spill, the head of Libya’s National Oil Co. said Sunday.
Shokri Ghanem, who serves as Libya’s de facto oil minister, said the April explosion of the Deepwater Horizon rig, and the subsequent spill, were “tragic,” but the oil industry is also moving into “new frontiers.”
“An accident will not stop us from digging in this new frontier,” Ghanem said. “Life must go on, but we will learn a lot of lessons.”
Ghanem’s comments are the latest confirmation by the OPEC nation that it was planning to honor the contract it signed with BP in 2007 to drill in the Libyan deepwater region of the Mediterranean Sea.
BWAHAHHAHAHAHHAHAHHAHHAHAHAHHHHHHHHHHHHH!!! (fpss™)
This could be interesting.
Court to rule on Sarbanes-Oxley and gun rights.
Sun Jun 27, 2010
WASHINGTON (Reuters) - The Supreme Court could strike down a key part of a 2002 corporate reform law and extend gun rights in the United States on Monday when the justices issue their final rulings of the term.
In eagerly awaited rulings, the nation’s highest court is expected to decide the constitutionality of a national board that polices auditors of public companies and whether gun rights extend to every state and city in the nation.
The nine justices could also decide a dispute closely watched by some software, biotechnology and financial companies on whether business methods can be patented if they involve a machine or transformation.
I think we should have a “Moron Czar” in D.C. and really start culling these fool clowns out.
Durbin asks Obama to appoint carp czar.
As concerns mount about the presence of Asian carp near Lake Michigan, U.S. Sen. Dick Durbin today urged President Obama to appoint a carp czar to oversee efforts to keep the invasive species out of the Great Lakes.
“We need to have one person who coordinates the efforts of the federal, state and local agencies that are doing everything they can to keep the Asian carp out of Lake Michigan,” Durbin said during a news conference at the Shedd Aquarium. “We believe it’s absolutely essential.”
Czar = Caesar = dictator.
Thus appointing a czar for every little special purpose in government is a bit of a contradiction in terms.
Yeah, I’m getting worn out with all the czars as well. I feel like I’m living in a Russian opera.
It’s the pols’ tried-and-true way of *handling* a crisis. Or at least look like they’re handling it.
“War and Peace” is more like it, at least regarding the number of characters (aka Obamaczars).
Except in this low comedy we get Czars AND Bolsheviks.
MSM Rule #1: If you can’t say something positive, then make something up.
South Florida foreclosures recede:
http://www.miamiherald.com/2010/06/27/1703030/flood-of-south-florida-foreclosures.html
“New measures — including a yet-to-be-unveiled Fannie Mae program — are aimed at speeding foreclosure procedures, allowing people to get on with their lives and figure out where they are going to live”.
Wonder what this new BS program will be? TPTB are flat out stuck on stupid and will keep right on screwing things up.
Drill Baby, Drill!
(Not just ’bout oil…)
Environment / Vanity Fair
A Colossal Fracking Mess
The dirty truth behind the new natural gas. look at a town transformed by fracking.:
By Christopher Bateman…Photographs by Jacques del Conte
By October 2009, the D.E.P. had taken all the water wells in the Sautners’ neighborhood offline. It acknowledged that a major contamination of the aquifer had occurred. In addition to methane, dangerously high levels of iron and aluminum were found in the Sautners’ water.
The Sautners now rely on water delivered to them every week by Cabot. The value of their land has been decimated. Their children no longer take showers at home. They desperately want to move but cannot afford to buy a new house on top of their current mortgage.
“Our land is worthless,” says Craig. “Who is going to buy this house?”
As drillers seek to commence fracking operations in the Delaware River basin watershed and in other key watersheds in New York State—all of which sit atop large repositories of natural gas trapped in shale rock deep underground—concerned residents, activists, and government officials are pointing to Dimock as an example of what can go wrong when this form of drilling is allowed to take place without proper regulation. Some are pointing to a wave of groundwater-contamination incidents and mysterious health problems out West, in Colorado, New Mexico, and Wyoming, where hydraulic fracturing has been going on for years as part of a massive oil-and-gas boom, and saying that fracking should not be allowed at all in delicate ecosystems like the Delaware River basin.
Read More:
http://www.vanityfair.com/business/features/2010/06/fracking-in-pennsylvania-201006
For those that have access to HBO (I don’t), the related documentary, Gasland, is currently being shown:
http://www.youtube.com/watch?v=dZe1AeH0Qz8
“Wastin away again in the West Wing” (to the tune of “Margaritaville”). Author unknown.
Nibblin on great steaks
Cancellin’ those tax breaks
The whole damn Gulf, it’s covered in oil
Playing my fiddle
Watchin’ Congress diddle
Countin’ tax money from the pee-ons that toil
Wastin away again in the West Wing
Searching for my lost copy of “Rules….”
I’m gonna claim that the right wing’s to blame
Then they’ll think….that it isn’t my fault
I don’t have any clues
How to fix these folks blues
Nothin’ to show but this new golfer’s tan
But it’s a real beauty
Got it shirking my duty
How I got elected, I haven’t a clue
Wastin away again in the West Wing
Searching for my lost copy of “Rules….”
I’m gonna claim that the right wing’s to blame
Then they’ll think….that it isn’t my fault
I bogied the last hole
Won’t let ‘em burn coal
Blamed George Bush for all the problems at home
Considering surrender
Changin’ what’s legal tender
Gettin’ a golf cart all covered in chrome
Wastin away again in the West Wing
Searching for my lost copy of “Rules….”
I’m gonna claim that the right wing’s to blame
Then they’ll think….it was never my fault
It fairly obvious that Barry’s main concern is golf, good thing he has little else to deal with.
G8: Obama interested in Huntsville’s golf courses:
When U.S. President Barack Obama stepped off his helicopter in Huntsville on Friday, the first thing he said was, “You’ve got a lot of golf courses here, don’t you?” Industry Minister Tony Clement told the National Post in an exclusive interview.
“I told him, ‘We would really recommend and love it if you could come back here with Michelle and the kids at some point — we think you’d really love it here,’”
I needed a good laugh, thanks Sammy.
Authorities seize $45 million of narcotics in California drug bust
“Overwhelming odor” in tractor-trailer leads to major drug bust, authorities say.
(CNN) — Authorities in southern California said the strong smell of marijuana helped them discover $45 million worth of drugs in the back of a tractor-trailer they had pulled over for a traffic violation.
Deputies stopped the truck Wednesday morning, then opened the trailer after finding problems with the paperwork for the load, the San Bernardino County Sheriff’s Office said Friday.
An “overwhelming odor” led investigators to about 20 tons of narcotics stashed in pallets in the back of the truck, including about 38,000 pounds of marijuana, 2,700 pounds of cocaine and 67 pounds of methamphetamine, the sheriff’s office said in a statement.
Sheriff Rod Hoops said Friday night the seizure was one of the largest in the county’s history.
The truck’s driver, Fernando Luevano, 32, was arrested and charged with possession, transportation and sale of narcotics, authorities said.
There was something in the air that night, the stars were bright, Fernando
ABBA or the San Bernardino County Sheriff’s Office
Oil spill takes toll on tourism on Gulf Coast ~ USA TODAY
GRAND ISLE, La. — On this sliver of land, summer is high season. And on a typical weekend, Artie’s Sports Bar would be crammed with more than 1,000 patrons peering at the ocean.
But this is no ordinary summer. The oil spill that has sent more than 90 million gallons of crude gushing into the Gulf of Mexico has seeped into the island’s bayous, roughly 50 miles from the sunken rig that sparked the leak. And visitors aren’t coming. Frankie Marullo, whose brother owns Artie’s, says there have been only a few dozen customers a day. And he fears those who are staying away this year may never return.
“The tourism business is shot,” he says. “This place is wiped out. It’s going to kill this little island.”
Vacationers are starting to steer clear of the Gulf Coast. The worst oil spill in U.S. history, which has endangered wildlife and stymied the fishing and oil trades so vital to the region’s economy, now is threatening the multibillion-dollar tourism industry as wary visitors cancel trips or plan vacations to places where they don’t have to worry about oil coming ashore.
Payrolls Probably Fell on Census Cutbacks: U.S. Economy Preview
(Bloomberg) — Employment fell in June for the first time this year, reflecting a drop in federal census workers as the decennial population count began to wind down, economists said before a report this week.
Payrolls declined by 110,000 last month, according to the median estimate of 51 economists surveyed by Bloomberg News ahead of a Labor Department report July 2. Private employment, which excludes government jobs, rose for a sixth consecutive month, the survey showed.
The pace of hiring indicates it will take years for the world’s largest economy to recover the more than 8 million jobs lost during the recession that began in December 2007. The turmoil in financial markets brought on by the European debt crisis raises the risk that employment will slow, depriving American households of the income needed to maintain spending.
“Employment fell in June for the first time this year, reflecting a drop in federal census workers”
Were those the good jobs for the jobless?
Barack Obama’s Primary Season Victory Speech
•This was the moment when we began to provide care for the sick and good jobs to the jobless; this was the moment when the rise of the oceans began to slow and our planet began to heal;
And what about the planet beginning to heal?
No wonder finger-pointing Obama wants oil spill finger-pointing to stop; Update: Interior Dept. official resigns
By Michelle Malkin • May 17, 2010 12:14 PM
You remember that old saying: When you point a finger at someone, there are three fingers pointing back at you.
Well, here are a few photos that certainly helps explain why the finger pointer-in-chief doesn’t want anymore finger-pointing over the Transocean Deepwater Horizon/BP oil spill:
The man on the left in the top picture is one of President Obama’s Department of Interior officials. He’s handing a national safety award to a Transocean official. The men in the second picture, posing with their district U.S. Department of the Interior’s Mineral Management Service (MMS) safety award, work for the Deepwater Horizon rig.
Apartment Sales Up in Manhattan ~ WSJ
Sales of Manhattan apartments picked up during the second quarter, to the fastest pace since the summer of 2008, an illustration that the market has been recovering during the spring selling season, usually the busiest time of the year.
A Wall Street Journal review of closed-sales filings with New York City Department of Finance shows that during the second quarter, which ends June 30, sales were running 80% above the pace reported a year ago.
Analysts said there has likely been a modest recovery in prices as well. Major brokerage firms are scheduled to release quarterly market reports on price trends next week.
The summer of 2008? Oh yeah, that makes me feel sooo much better.