Bits Bucket For September 13, 2010
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Tampa Bay home prices hit 10-year lows in August, report says
By Jeff Harrington, Times Staff Writer
Posted: Sep 10, 2010 04:45 PM
“Sellers asked a premium for their homes, which buyers were willing to pay to take advantage of the tax credit,” he said.
Four months later, he said, prices have dropped by an average of $13,000, indicating tax credit-buyers overpaid.
http://www.tampabay.com/news/business/realestate/tampa-bay-home-prices-hit-10-year-lows-in-august-report-says/1120778 - 62k
“Four months later, he said, prices have dropped by an average of $13,000, indicating tax credit-buyers overpaid.”
I’m frankly surprised they are merely down by only $13,000, but perhaps we are seeing a shift of new purchases into higher quality homes than ‘first time buyers’ armed with $8K of hot money were able to afford.
As I pointed out at numerous points during the time the tax credit was in effect, leverage coupled with low down payment requirements (e.g. 3.5% FHA) could serve to greatly amplify the impact of the $8K credit on purchase budgets. For illustration, an $8K credit which implicitly provided for a portion of the buyer’s downpayment would potentially have qualified the prospective buyer to buy a home that was $8000/3.5% = $228,571 more expensive than what she might otherwise been able to ‘afford.’
I think the quote ought to be: “Four months later, he said, prices have dropped by an average of $13,000, indicating tax *crack-buyers* overpaid.”
Roidy
Well, we just have to do a $13k retroactive home-buyers credit. That settles it.
and 21 k after that!
I think housing prices there are low enough that they wouldn’t have qualified for the full 8k anyway. Instead, they probably got around 2-3k, whick multipled by 6-7 times thanks to leverage, gives you 13kish.
don’t forget interest rates are down 5/8ths of a point too. That is why the prices “only” went down 13K. I did an NPV a few weeks back, forget the parameters now but came out to 18K in current dollars vs. 8k in tax credit.
I should add that one of the assumptions was a similarly priced house, not x-13K. That would be even more fun to circulate around the watercooler.
bravo!
PB wrote:
As I pointed out at numerous points during the time the tax credit was in effect, leverage coupled with low down payment requirements (e.g. 3.5% FHA) could serve to greatly amplify the impact of the $8K credit on purchase budgets. For illustration, an $8K credit which implicitly provided for a portion of the buyer’s downpayment would potentially have qualified the prospective buyer to buy a home that was $8000/3.5% = $228,571 more expensive than what she might otherwise been able to ‘afford.’
—————–
PB,
You have no idea how foreign this concept was to very intelligent people. I’ve tried to explain it numerous times, and people would just look at me with an empty stare (add to that, BTW, the 6% “seller concessions” that can be applied to closing costs, etc. — the leverage is even greater).
Everybody was telling us what a great time it was to buy during the tax credit, and I’d look at them and say, “it’s a fantastic time to sell,” and turn away. It’s frustrating beyond words.
Again, nothing has been learned from this debacle. Absolutely nothing.
Four months later, he said, prices have dropped by an average of $13,000, indicating tax credit-buyers overpaid.
Hmmm, ISTR a bunch of HBB-ers saying this very thing would happen. And the HBB bunch was saying it about a year ago.
yes HBB did predict the credit would only serve to lure more buyers into still over priced RE.
I just finished reading “the big short” fun book easy to read.
hard to see how we can come out of this “business as usual “after so many bad bonds were sold.
Las Vegas condos on sale! Hurry, hurry, they’re not making any more condos, er, uh, I mean…
http://www.usatoday.com/travel/destinations/secondhomes/2010-09-09-las-vegas_N.htm
examples from some of the city’s most prominent buildings, such as condos at Trump Las Vegas, which have dropped from “around $600,000 to $167,000.”
Now that’s a nice Trump haircut!
Youch. Youch, youch, youch.
You’ve got to be really hating life if you were one of the early buyers at $600k.
(Or maybe not, since you’d be lone gone by now.)
yeah, the early buyers are probably getting close to having their credit cleaned up by now, and are getting tempted to sit down for another bite of cr*p sandwich.
“Now that’s a nice Trump haircut!”
Is it still considered a haircut if it is a wig/weave/hairplugs? Or can we hopefully find another term - especially if prices go from $600K to $167K …
1. Amputation is the removal of a body extremity by trauma or surgery. As a surgical measure, it is used to control pain or a disease process in the affected limb, such as malignancy or gangrene. In some cases, it is carried out on individuals as a preventative surgery for such problems.
2. Lobotomy (Greek: λοβός – lobos: “lobe (of brain)”; τομή – tome: “cut/slice”) is a neurosurgical procedure, a form of psychosurgery, also known as a leukotomy or leucotomy (from the Greek λευκός – leukos: “clear/white” and tome). It consists of cutting the connections to and from the prefrontal cortex, the anterior part of the frontal lobes of the brain.
I’d rather have a bottle in front of me than a frontal lobotomy.
you’re Slackin off guys:
http://www.youtube.com/watch?v=oHITbssu9RE
I bet he can’t comb over that one!
“obvious. The city…… also offers plenty of outdoor activities and natural beauty.”
Does barren rockscape count as natural beauty?
About as much beauty as a comb-over.
Got a football hangover?
The Bucs actually won, I can’t believe it. Maybe they should black out the games more often. Anyway ticket prices are outrageous (oh yeah, but we love our fans!)
Of course, one thing I’ll probably never learn is that making a disparaging comment about a team to a relative stranger is not a good idea. I nearly took a punch yesterday for insulting the Bucs.
” I nearly took a punch yesterday for insulting the Bucs.”
I’ve always been amused by the rabid loyalty some people have to corporate sports. As if these teams won’t pick up and move if it means more $$$ for the owners, especially in the form of corporate welfare. At least the local college team isn’t going anywhere.
would the woman who left her 7 kids at Tampa Stadium please come back and pick them up. They’re beating the Buc’s 13-0.
The Bucs actually won, I can’t believe it.
If you can’t be good, at least have a charitable opponent with a turnover-prone qb.
Anyway ticket prices are outrageous.
When I priced Chargers tickets a few weeks ago, the cheapest were more than $50 and most were more than $75, for regular season!
Why would I want to spend that much for a regular season game in a mediocre stadium as well as deal with all of the hassles of attending a game? Watching on television is just fine.
I think football is much better enjoyed on television, but those ticket prices don’t seem that high considering there are only 16 games to a season. I’ve seen much higher priced baseball tickets where there are 162 games. That said, it’s a rare occasion that I attend. I don’t agree with the prices, either.
that is why i go to high schoo f-ball games great entertainment a 6 buck admission
The Bucs were about 28 million under the salary cap last year and 38 million under a few years before that. No other team was even CLOSE to paying so little. Gruden had to be a miracle worker to come up with winning teams for a few years. (So they fired him.)
Yet, this is rarely, if ever, discussed.
So we’re supposed to root for a team so the owner can pocket all that money ? He’s not even trying to put a good team together. It’s ridiculous.
Bill:
Glazer needs that $$$ to pay for the Manchester United soccer team they bought with tons of debt
“Anyway ticket prices are outrageous ”
I could never understand why people spend that kind of money on watching a game. First you get to spend hours in a traffic jam. Then $20 for parking. After you get in the stadium you get to pay$7+ for one crappy beer. Back in the days I used to smuggle in a 6-pack but after 9/11 that became impossible. When the game is over you get stuck another hour (or more) in traffic. I got better things to do with my time and my money. When I was a kid I used to watch soccer (in Germany). Many players stayed with the team for the duration of their careers. Nowadays they play for a different team just about every season. It sill amazes me to see the cult of sports fans that sink serious money into “their team” and get all worked up about it….appearently opium for the masses comes in various different flavors.
We live near a large university that has a major football program. A surprising number of the folks in our retiree community belong to the booster organization even though they never attended that university. They pay several thousand dollars each year to get the right to buy relatively choice season tickets, which are expensive in their own right. It appears it’s all for the opportunity to tailgate with friends at each home game before they go into the stadium to watch the team achieve another winning, but not championship, season.
Big whoop.
I go to college games with a friend. All the negatives have been listed but the positives are many.
Tailgating with friends and eating very good food.
Lots of people watching.
The folks near you in the statium usually know you and cheering is alot of fun with thousands of people.
More people watching.
It makes good conversation for friends since it does not involve loosing money on a house or losing your job or whatever. People can have strong feelings and you can just enjoy the conversation.
I see people come who don’t enjoy it. They either don’t like the seats or the lines or whatever. In my youth, those things would have bothered me but at middle age, I find it very much fun.
I don’t like the drunks so we moved our season tickets about 20 rows back and they mainly sit in front. I am surprised how much I like it. The cost is only about $500 for tickets. About $150 for parking per season. Tailgaiting food is probably cheaper than eating at home. (Crackers, cheese, fried chicken)
We live near a large university that has a major football program. A surprising number of the folks in our retiree community belong to the booster organization even though they never attended that university.
Same thing’s happening here in Tucson. Only diff is that the sport is men’s basketball, not football.
Personally, I couldn’t care less.
Same in Missoula. Tailgating has grown incredibly, now with live bands and beer garden…It’s What People Do now, and like Insurance Guy says, it’s something *safe* to talk about.
I liked my alma mater better before it became a football school.
I like the not-so-popular college sports, like soccer or softball. All of the fun without the hassles.
Oh yeah and it’s cheap. A family of 4 can catch a game, hot dogs and drinks for $24.
Another good option is minor league baseball or hockey.
I agree on minor league baseball. It’s cheap, all the seats are close enough that you can actually watch the game and see the plays, and the traffic is considerably lighter.
Here in Boise it’s hard not to notice Boise State football. The town is going nuts in a Norman Rockwell sort of fashion. The team is ranked 3rd in the nation this year with a shot at the championship title.
Here in Boise it’s hard not to notice Boise State football.
Especially the gridiron turf.
Hey, no “green shoots” on our football turf.
I don’t think they’ll be considered for a championship after they lose at Nevada.
This same university also has pretty good tennis teams. I very much enjoy watching the women play.
Oh, and it’s free.
Those college gals have a term for you: creeper.
I love college football! Getting season tix to my husband’s alma mater is not cheap, but it’s been worth every penny. I figure it’s a cheaper (and less dangerous) mid-life item than a sports car or a bimbo.
What a great comment, SouthFL. I appreciate your humor, too.
“When I was a kid I used to watch soccer (in Germany). Many players stayed with the team for the duration of their careers.”
I used to attend the local Colorado Rapids soccer matches when they were affordable. I don’t go anymore, as decent seats now cost $40.
“The Bucs actually won, I can’t believe it.”
Did you happen to say that at or near the time when you thought someone was going to punch you?
My big old “Black n’ Purple” NFL Minnesota Vikings parka always makes me the center of attention when I stroll into a Wisconsin sports bar to watch a football game. More than a few huge Packer clad faithful have eyeballed me hard, then come over and said…”That’s a nice jacket”.
Then they wait for me …outside in an alley with their GB hatchets and their G/F’s have hard snowballs.
(no mikey’s were ever seriously harmed or injured according to the local police and 5 o’clock News)
Bankers urge government to pull plug on Fannie, Freddie
Housing Market By Corbett B. Daly
WASHINGTON | Wed Sep 8, 2010 4:35pm EDT
WASHINGTON (Reuters) - The federal government should take mortgage finance giants Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) off life support sooner rather than later, the Mortgage Bankers Association urged on Wednesday.
The bankers said Fannie Mae and Freddie Mac should move beyond the “conservatorship” that started two years ago and be placed “receivership.”
“The current situation is not unlike a brain dead patient who is being kept alive indefinitely by artificial life support,” Courson and Berman wrote.
http://www.reuters.com/article/idUSTRE68758O20100908 - 66k
“The current situation is not unlike a brain dead patient who is being kept alive indefinitely by artificial life support,”
Except that these brain-dead patients are tasked with funding U.S. home purchases which are too risky for private lenders to touch and for private mortgage lenders to insure at a price the buyer could afford or would be willing to pay.
Frankly I’m surprised the mortgage bankers are taking that stance. Who’s going to buy the crappy mortgages they originate in the future?
Really good question.
Something tells me the Federal Reserve might play a role.
(caveat on the following - it’s pure conjecture on my part - perhaps someone with more knowledge can weigh in…)
That being said - who exactly is the MBA? I’m not sure they’re really representative of “bankers”, in terms of the big guys (BofA, Citi, JPM, etc.) at least. My impression is they’re more like the Chamber of Commerce of the banking industry; more representative of the smaller banks. If so, then it could be that they see the unfairness of the current system, favoring the big banks over the smaller, and see this as a way to remove some of that.
Everybody is going to automatically qualify for a new low TTT loan regardless of credit history. Ben B sez: “Drive away with a FED home-loan today! No credit, no job, no social security number, No problem!!!”
…who exactly is the MBA?…
Same exact question occurred to me, so I looked it up.
The Mortgage Bankers Association (MBA) is the national association representing all facets of the real estate finance industry. wiki
All they care about is that the crap mortgages get paid and that their jobs and salaries are secure.. even if it requires nationalizing the whole industry.
OK - well, I kind of assumed by the name that they were involved in real estate finance. I meant who are they composed of, bank wise. Oftentimes organizations like that (like in the tech world) aren’t cross-industry; instead there may be competing organizations within the same industry that have different interests. More often than not it’s a big-guys vs. small-guys thing - e.g. one consortium lobbying congress for legislation that helps the big guys, another competing one lobbying against that legislation (or for competing legislation).
The Mortgage Bankers Association (MBA) would more rightly be called the Mortgage Brokers Association (MBA).
MORPAC raises money to help elect and re-elect candidates to Congress who have an understanding of the real estate finance and housing industries, and who are supportive of the mortgage profession
How can govt support the mortgage profession other than by encouraging the proliferation of more mortgages?
These are not the guys who are on the hook for the mortgages, but they make their living brokering/selling mortgages. They lobby for and benefit from things like large sales volume of housing, low lending qualifications and requirements, etc.
Here’s one of ‘em with an interesting cv:
Jay Brinkmann is Chief Economist and Senior Vice President of Research and Economics for the Mortgage Bankers Association (MBA), where his responsibilities include economic forecasting, mortgage industry analysis, the benchmarking of industry profitability, and analysis of legislative and regulatory issues.
He joined the Mortgage Bankers Association in early 2001 and headed MBA’s research group. He was named Chief Economist in 2008. Immediately prior to MBA, he worked in Fannie Mae’s portfolio strategy group. He is a native of New Orleans, began his career as a Capitol Hill press secretary and served as the deputy chief of staff to a governor of Louisiana. He has worked in commercial banking and was on the business school faculty at the University of Houston where he specialized in financial institution regulation.
Nothing like a little banking-political incest, is there?
’surprised the mortgage bankers are taking that stance’
Not so much, IMO. I was listening to a medical care provider in Haiti on the radio recently. He was saying that the relief efforts there were actually destroying the local health infrastructure as it was giving away what they did for a living. Similarly, the reason there’s no private mortgage market is the GSEs are backing it without pricing in risk. Sure, loans are being made, but nobody’s making much profit at 4% interest, 3% down, in a declining market.
Not so much, IMO. I was listening to a medical care provider in Haiti on the radio recently. He was saying that the relief efforts there were actually destroying the local health infrastructure as it was giving away what they did for a living.
Ben, were you at the same party I attended yesterday afternoon? It was an international student welcoming event near the University of Arizona.
One of the new students is from Haiti, and I asked him how the country was doing. He said that the food relief has pretty much killed off any domestic agriculture that the country might have had.
Which means that a lot of no-longer-want-to-be-farmers have flocked to the cities. Where they can’t find work.
That’s been the problem with a lot of “foreign aid” over the years. It may sound backwards, but it may do them more good to buy their food rather than give them our food. What do most poor countries have to sell other than ag products?
This begs the question though about Haiti. Given that food and medical aid is (apparently) killing their health care and agriculture industries - is giving such charity to them therefore even appropriate?
Seems to me that in the short run - the first year or two after a devastating earthquake, that the demand for food and medical care would experience a huge spike - something that the local systems couldn’t even come close to handling. Thus the harm of bringing in outside aid (food and medical care particularly, but also in the form of housing, clothing, and other services) seems like would be more than overcompensated by the outside aid.
It seems like if I were a Haitian doctor or nurse, I wouldn’t try to compete with outside health care aid - I would instead join the distribution program, which I would imagine includes some kind of payment (or at least should). Same for farmers - transition, temporarily, from producing food to helping to distribute the incoming aid food.
The over time as the foreign aid slows, transition back to locally-supported industries.
Thoughts?
The over time as the foreign aid slows, transition back to locally-supported industries.
Thoughts?
Great concept for transition and I think it would apply to the USA’s inequality of wealth which is another type of disaster.
The remedy is to institute highly progressive taxes on the super-rich’s income AND wealth, jack up import duties and invest this money in domestic manufacturing, small businesses, all types of education, green energy, energy independence and infrastructure.
Scrap Obamacare and move to a Canadian type single payer system, freeing up about 7% of GDP for investment in the above and to give Americans freedom to be risk-taking capitalists.
Scrap the Drug/Prison system and spend that money on education and serious “free”, long term (months) substance abuse programs, camps and centers.
Then reduce these higher taxes and welfare type programs as we transition back to locally-supported and locally-producing industries.
It would work but I don’t think it will happen.
“Similarly, the reason there’s no private mortgage market is the GSEs are backing it without pricing in risk.”
The risk is getting priced in, alright. Take a look at the amount of taxpayer-funded GSE losses for an indication of the true cost of these ‘free’ loan guarantees.
“He was saying that the relief efforts there were actually destroying the local health infrastructure as it was giving away what they did for a living.”
Ben…last season there was an episode of “V” where the alien visitors were providing miracle cures to the earthlings to win their hearts and minds.
in one episode…the U.N. chief was from a third world country and was skeptical of the “V’s intentions. he did not approve of their welfare because it was destroying his country’s economy which was primarlily health care related.
when he was questioned by an idealistic reporter “so mr. secretary your telling me that the bottom line is more important than your people’s well being”?
he responded…”noooooo…i am telling you…they are the same”.
freeing up about 7% of GDP for investment in the above and to give Americans freedom to be risk-taking capitalists.
How is that going to happen when you just confiscated a large portion of the wealth that people would use to be capitalists?
Let me boil down your suggestion into 3 steps:
1) Take money from those who have it
2) distribute the money to those who don’t, so now they have “a little” rather than none
3) Expect those who had their wealth stripped away to become “risk-taking capitalists”.
How does that work, exactly? Why would anyone want to earn wealth in the environment you describe, when you’re just going to take it away from them?
How is that going to happen when you just confiscated a large portion of the wealth that people would use to be capitalists?
Relax, It wasn’t confiscated, it was taxed. Better?
And it’s only the super rich. They are not even capitalists anymore, not the kind that create jobs in America. They skim money and create jobs overseas. I don’t care about this unpatriotic group of scum anymore. Why do you? They are not American job creators anymore. Period.
Let me boil down (dumb down?) your suggestion into 3 steps:
1) Take (TAX) money from those who have it
Yes, tax the super rich at the percentage they were taxed from the 50’s to the 70’s. Tax breaks to those who create AMERICAN jobs.
2) distribute the money to those who don’t, so now they have “a little” rather than none
Not welfare. But raise duties, invest in US manufacturing, education, industries and infrastructure, energy, jobs and did you even try to comprehend my post?
3) Expect those who had their wealth stripped away to become “risk-taking capitalists”.
You’re not getting the big picture. You see, I don’t care about those clowns, they don’t care to risk capital to benefit America, they only risk capital to benefit themselves. You can’t see this?
How does that work, exactly? Why would anyone want to earn wealth in the environment you describe, when you’re just going to take it away from them?
Dang. Here it is again.
They would want to earn wealth in the environment I describe because the benefits and programs would reward those who earned wealth that benefited Americans and America and not WS and China.
Relax, It wasn’t confiscated, it was taxed. Better?
And it’s only the super rich. They are not even capitalists anymore, not the kind that create jobs in America. They skim money and create jobs overseas.
So talk in specifics. At what level of income does this super-taxation come in to play? At what level of wealth? The number thrown around is $250k combined income. Do you consider those folks the “super rich”? I guarantee you the family making $250k is not doing so by outsourcing jobs and doing all the evil things you mention.
Yes, tax the super rich at the percentage they were taxed from the 50’s to the 70’s. Tax breaks to those who create AMERICAN jobs.
Does IBM not create American jobs? And HP? And Apple? They most certainly do. So would they get tax breaks? Can you give some examples of the companies that would be taxed at this high rate? What metric would you use to distinguish one from the other? (note - it has to be something you can codify into law, not just “tax the rich bad guys”).
invest in US manufacturing, education, industries and infrastructure, energy, jobs
So please explain how the government does that? Sounds like exactly what they did with GM….take money from the productive folks, and give it to failing companies that clearly can’t compete. Sounds a lot like welfare to me. Otherwise, you’re just giving the money back to the productive companies you took it from, but of course the gov’t gets to skim off the top and grow itself.
They would want to earn wealth in the environment I describe because the benefits and programs would reward those who earned wealth that benefited Americans and America
Again, how do you differentiate one from the other? You simply said tax the high income earners and super-wealthy. Which is it? What is your criteria for who can prosper and who can’t? And who says you should get to have a say in that?
…at the percentage they were taxed from the 60’s to the 70’s.
If the tax breaks expire for the well-off they will only be paying 39%. And that is only on their earnings above $250,000, up to that point they are taxed at the lower brackets.
This is only a big deal to the super wealthy and they can well afford it.
So talk in specifics. At what level of income does this super-taxation come in to play? At what level of wealth? The number thrown around is $250k combined income. Do you consider those folks the “super rich”? I guarantee you the family making $250k is not doing so by outsourcing jobs and doing all the evil things you mention.
Yes, tax the super rich at the percentage they were taxed from the 50’s to the 70’s. Tax breaks to those who create AMERICAN jobs.
Does IBM not create American jobs? And HP? And Apple? They most certainly do. So would they get tax breaks? Can you give some examples of the companies that would be taxed at this high rate? What metric would you use to distinguish one from the other? (note - it has to be something you can codify into law, not just “tax the rich bad guys”).
invest in US manufacturing, education, industries and infrastructure, energy, jobs
So please explain how the government does that? Sounds like exactly what they did with GM….take money from the productive folks, and give it to failing companies that clearly can’t compete. Sounds a lot like welfare to me. Otherwise, you’re just giving the money back to the productive companies you took it from, but of course the gov’t gets to skim off the top and grow itself.
They would want to earn wealth in the environment I describe because the benefits and programs would reward those who earned wealth that benefited Americans and America
Again, how do you differentiate one from the other? You simply said tax the high income earners and super-wealthy. Which is it? What is your criteria for who can prosper and who can’t? And who says you should get to have a say in that?
Again, how do you differentiate one from the other? You simply said tax the high income earners and super-wealthy. Which is it? What is your criteria for who can prosper and who can’t? And who says you should get to have a say in that?
You’re not in a listening mood, you’re in a confrontational mood. What I propose is not new. Many countries have done aspects of ALL of my proposals. What make USA so damn special that we we can’t learn from others? It’s different here? This is our downfall.
Those with inflexible, ideological, dogmatic and flawed agendas ALWAYS refuse to learn from other examples. A pity.
Your answers can be found here. Look to Germany and much of Europe and Brazil for examples on how to protect promote and nurture domestic industries.
Look to much of Europe on income and corporate income tax structures, health-care and jobs protection.
Look to Brazil on how to become Energy Independent, bolster the middle-class and have a trade surplus.
Look and you will see. All your questions are answered here if you use you mind and study. Look to examples that are working and learn from them.
Or just parrot trite banalities.
You’re not in a listening mood, you’re in a confrontational mood.
So says you. You’ve offered nothing to listen to. You’ve thrown out vague generalities, and when I challenge the specifics, you say what exactly?
Nothing of substance.
If Germany, France, and Brazil are good examples, then use them to come up with your numbers and address the specifics. Otherwise you’re effectively saying “we’ll wave a magic wand around and it will all be good”.
The devil is in the details. If you can’t suss out the details, then what’s the point?
The devil is in the details. If you can’t suss out the details, then what’s the point?
There is no “point” with you, ever. Your are a tactician trying to discuss strategy.
That is the “point”. Think and learn.
Think and learn.
yes, clearly you are the all knowledgeable one, and are in a position to condescend to all that dare disagree with you.
You’re missing the issue here. You and I don’t agree on the goals. You assume everyone wants the same thing you do. I don’t.
I want freedom. With that comes responsibility and self-reliance.
You don’t want freedom. You want the government to somehow make everyone “equal”. The second I challenge the feasibility or morality of your goals, you get all high and mighty and claim that I’m simply not enlightened enough.
Perhaps you should stop thinking that you have all the answers. You don’t. And you’re not better, smarter, or more enlightened than anyone here. So stop acting like such a twit.
Rio,
Once again, you’ve made excellent points.
It’s tiresome to hear the tirade about “taxing the productive” when the wealthiest Americans only earn about 19% of their income from “work.”
—————-
“(But it’s important to note that for the rich, most of that income does not come from “working”: in 2008, only 19% of the income reported by the 13,480 individuals or families making over $10 million came from wages and salaries. See Norris, 2010, for more details.)
http://sociology.ucsc.edu/whorulesamerica/power/wealth.html
(This is a great article, BTW.)
——————–
As for all those “investments in jobs” the wealthy supposedly make…corporations have been making record profits this past decade. If the tax breaks worked, and if these “benevolent” super-rich were going to provide jobs, why didn’t they do so already?
the wealthiest Americans only earn about 19% of their income from “work.”
That might be a valid point of the people only earning 19% of their income from work were those being taxed.
The reality is all these calls to increase taxes include people who have worked their whole life and continue to work hard. But no one here cares to address that fact.
I marry another engineer, and we broach the $250k income barrier, all of a sudden we become part of the “evil wealthy” who no longer have claim to our income, apparently.
No one here has provided an argument for the morality of taking someone’s wealth away from them simply because they have it. Y’all just label them as the “evil wealthy” and claim that the government has a right to their money.
And just because one’s income doesn’t come from wages doesn’t mean they’ve not worked to earn it. Have people on this board not worked to earn money, and made sacrifices to save it? Are we not entitled to any income we may generate from those savings?
Perhaps you should stop thinking that you have all the answers. You don’t.
Gee Wiz. I know I don’t have all the answers drumminj.
I just have more than you is all.
I just have more than you is all.
Yes, clearly you think so. It’s a shame you’re incapable of demonstrating it.
But you have demonstrated your lack of maturity. Good show.
Are you guys reading this the way I am?
The MBA does not want the GSEs to go it alone, or to fail, or to “take them off life support” .
Just the opposite. The proposal is to put them into receivership.
..The bankers said Fannie Mae and Freddie Mac should move beyond the “conservatorship” that started two years ago and be placed (in) “receivership.”
While conservatorship puts the GSEs under the regulatory control of the govt, receivership means the govt takes responsibility for the GSEs…
Receivership is not outright ownership, but it’s as if you took possession of someone else’s property. You are responsible for what happens to it.
Receivership is one step closer to the govt (meaning us) actually owning F&F.. i.e. nationalization.
If you’re reading that right, then the proposal is to attach a dead limb to a seriously ill body. Great medicine there.
“The current situation is not unlike a brain dead patient who is being kept alive indefinitely by artificial life support,” Courson and Berman wrote.
This patient needs to be classified as DNR.
“The current situation is not unlike a brain dead patient who is being kept alive indefinitely by artificial life support,” Courson and Berman wrote.
This patient needs to be classified as DNR.”
Hummm…not unlike the entire US Body of Politics.
“Blue Star” them all with a magic wand and “Do Not Resuscitate”
That’s kind of scary. If the banks want it, it won’t be good us.
I wonder what’s REALLY going on.
“…for us.”
That’s what I’m wondering, eco.
There is something patently odd about the notion that stock market bulls will throw a party today over new international banking rules. The visit to my old high school by an AA member comes to mind; he explained to the students how an alcoholic can find occasion to party on any day of the week.
MarketBeat
WSJ.com’s inside look at the markets
* Bank Stocks Rally After Basel
* September 13, 2010, 6:11 AM ET
A Toast to… New Bank Rules?
By Neil Shah
Usually bankers don’t like more regulation. But, in a sign of widespread relief, Europe’s markets are kicking off Monday by throwing a post-”Basel III” bash.
Banking regulators from around the world reached an important agreement Sunday on new rules that will mean new, tougher capital standards for financial institutions. The new rules, called Basel III after the Swiss city where regulators hashed out the deal, require banks to hold more capital in their coffers to protect against the risk of huge investment losses like we saw in the financial crisis.
Bank stocks are roaring higher, leading the gains for Europe’s stock markets. The Stoxx Europe 600 Index is up 1.1%, while blue-chip shares in London and Madrid have gained 1.1% and 1.2%. France’s Credit Agricole, however, has soared nearly 6%, while Germany’s Commerzbank has risen 2.3%. The euro has gained 0.7% in value against the dollar to $1.2813, while Europe’s bond markets are in better spirits following a bout of turbulence last week sparked by fears about Greece’s solvency and Ireland’s banks. Credit default-swaps tied to Ireland and Greece – which investors buy to insure themselves against a sovereign-debt default – are falling in price.
So, what gives? Well, Basel III turns out to look more or less like what the world’s top bankers expected – that’s good news. While the rules are likely to make banks less profitable in the future since it curbs their risk-taking, bankers can at least be happy that this is behind them now. Indeed, some folks are already moving forward: Witness Germany’s Deutsche Bank, which is raising nearly 10 billion euros in fresh cash from existing investors, partly because of the new requirements.
…
What’s odd about it?
The new rules tightened lending practices and increased reserve ratios among other things. The banks and the loans they make are less risky and should naturally attract investment.
There is something patently odd about the notion that stock market bulls will throw a party today over new international banking rules.
Yes that is… odd.
Or not. Foxes don’t so much might making henhouse rules.
Of note - one of the tenets of Basel III is tightening reserve requirements; i.e. a higher level of reserves must be held for investments. However the level of reserves are “risk-based” - i.e. higher-risk investments require higher reserve ratios. However risk, as we know, is very subjective and changes over time. My belief is that one of the causes of the housing bubble is indeed the Recourse Rule in 2001, which set reserve requirements to only 1:50 for MBS, because they were considered safe.
My guess? Treasuries will be the next “super-safe” investment; requiring very low reserve ratios. And we know what can happen then…
What is the next Panic? … or is there one?
I’ve been reviewing the whole economic bubble and collapse. Looking into it and relying on my past experience on other bubbles (oil in Louisiana in the 1980’s), these collapses are triggered by a “revelation” that the whole mess is so over-priced and that potential buyer’s demand is satiated. This news comes as a “surprise” to investors. I know it shouldn’t, but it does. The blow off begins at this point. I don’t think these sell offs qualify as a “panic.” It’s actually a rational act.
So, what is next? WS is so “spooked” about every bit of news that I can’t see what the next “shock” to the system could be. Bonds? I suspect the next one is the DADT condition of the banks because of their “new” account rules for the garbage they have on their books. I guess I’m asking “Have we missed anything?”
I remember the bank stress test from a year or more back. I didn’t believe it then, and still don’t.
Roidy
“What is the next Panic? … or is there one?”
Or is the last one still in progress, though obscured by green shoots?
Hey Prof,
How was the weekend?
Anyway, sure the last crisis is in progress. As a matter of fact, the news cycle has gotten so short that the longer term problems - meaning those of more than a few months - are ignored or explained away. For instance, there has been an inventory rise over the last month or so. Inventory rise? This was touted as a good thing, but I don’t see how. We have been “rebuilding inventory” for about 15 months now. Does this rise mean that we are entering another phase? That of an inventory overhang? Yet WS rallied.
Me? I strongly suspect that WS is still not facing reality because it seems to sell off at the slightest sign of a problem.
BTW, I’m reading Paulson’s book On the Brink. They made a conscious decision to make all of the bond holders whole during the “financial system rescue.” Anyone that says Paulson, Bernanke, etc. didn’t think this through is blowing smoke up our skirts.
Roidy
I am still guessing that the Greek financial crisis will eventually spread worldwide. But that’s just my own guess. You are right - they get spooked by their own shadows these days..
Think of it this way, and perhaps you will reconsider your view:
1) The Thai baht crisis spread worldwide after it erupted in 1997.
2) Too-big-to-fail regulators had over ten years since then to figure out how to avoid allowing local crises to spread world wide.
And why might I be wrong?
- Investment banks have had over ten years since 1997 to multiply and amplify their foolish gambles into hyperdrive, counting on too-big-to-fail regulators in the global banking system to make them whole in case they roll snake eyes.
Modern day black swans in the banking system are man made.
Modern day black swans in the banking system are man made.
Absolutely.
they should put sheets over all the mirrors in their house like I do
They have plenty of smoke. No need for sheets.
Spook…you are MINE for Halloween !!
Once bond investors wake up to the fact that Greece, Japan, US and various other deadbeats can only pay back maturing bonds by taking on ever increasing new debt it will lead to the mother of all panics. This one will be too big to bail. Of course every creative accounting trick will be used to obscure the true state of affairs. Think about it, Madoff had his $65 billion $$ Ponzi scheme running for 20+ years. He was only one guy and a few insiders. Here we have essentially all governments and all (central) banks running the biggest Ponzi scheme the world has ever seen. They can and have created new accounting rules to obscure the truth. They will do everything in their power to keep the game going as long as possible. Bailing out smaller players (Greece, Municipatities, States, larger Banks, Insurance companies, etc.) along the way. Eventually the dam will have too many holes to plug. That might still take two decades or it might take a few more month, very difficult to say. It’s a confidence game which can turn very quickly.
Once bond investors wake up to the fact that Greece, Japan, US and various other deadbeats can only pay back maturing bonds by taking on ever increasing new debt it will lead to the mother of all panics.
US and Japan can print money.
US and Japan can print money.
Yes but that doesn’t change the fact that new debt has to be taken on. The new debt is paid for by printed money.
All fine and dandy… for a while.
Here we have essentially all governments and all (central) banks running the biggest Ponzi scheme the world has ever seen.
This is why it might not crash as hard as a Ponzi scheme. If, the cops, courts and government were behind Ponzi’s scheme, would it have crashed as hard?
Good point.
However one could also make the point that in the end it might crash even harder - because it’s allowed to build a lot bigger than a non-government ponzi scheme can.
“What is the next Panic? … or is there one?”
Larry Summers is counting on innovation to come to the economic rescue now that the Chinese have reduced their U.S. bond purchases. Sovereign debt is said to be the latest chat at parties where I’m barred.
Larry Summers is an idiot. Donna Summers could do a better job than he’s doing.
LOL……..
nice!
Not an idiot a criminal.
One of the cheerleaders for the Gramm-Leach-Bliley Act.
Who Is Next Bove List:
http://tinyurl.com/6ctv8s
Is your banksters on it ?
I’m not really good at answering questions, however, sometimes I find, asking them can be fruitful.
Banks rally on more regulation? Is it because of what the regulation did? Or is it what it did not do?
Banks get nine years to conform to new capital requirement rules:
Nine Years!!!
http://finance.yahoo.com/news/Banks-get-time-to-adjust-to-apf-721299853.html?x=0&sec=topStories&pos=5&asset=&ccode=
Party time on Wall Street today!!! Nine years from now is like forever in the mind of a day trader…
Nine years? I think you actually meant noon. Didn’t you?
Roidy
Is all real estate still local these days? And whatever became of The Giant Pool of Money?
The Financial Times of London
Fall in lending fuels housing market fears
By Daniel Pimlott, Economics Reporter
Published: September 13 2010 12:24 | Last updated: September 13 2010 12:24
Lending to first-time home buyers fell in July, adding to signs of weakness in the UK housing market.
Mortgages granted to first-time buyers dropped to 19,400 from 19,700 in June and 20,100 a year earlier, the Council of Mortgage Lenders reported.
Lending to first-time buyers in the three months to July rose by 8 per cent compared with the same period a year earlier, the slowest growth in almost a year.
People buying their first home are now having to put in larger deposits after lending terms had eased slightly earlier in the year.
The average deposit size was 24 per cent of the cost of a property, the same as in June but higher than the 21 per cent deposit required in the two months before that. The size of deposits compared with home value remains close to its largest since records began in 1979.
First-time buyers are seen as key to the functioning of the housing market, providing the new demand and cash that oil the system and allow properties to keep changing hands.
People moving home are experiencing a slightly better market – the number of loans to those who already own a property rose 11 per cent in July to 36,900 compared to a year earlier. But deposit sizes also rose from 33 per cent to 35 per cent of home value.
With the Bank of England’s policy rate at a record low, interest rate costs are relatively subdued. First-time buyers’ interest takes up 13 per cent of income – the lowest since 2004. Home movers interest payment make up about 10 per cent of income, the lowest since the early 1970s.
“Lending criteria remain tight, underpinned by caution on the part of both borrowers and lenders in the light of continuing economic uncertainty,” said Paul Samter, economist at the CML. The CML data cover 94 per cent of the residential mortgage market.
…
… since records began in 1979.
The UK has been around for how long, and they only started keeping RE records 30 years ago?
I’m trying to figure out why the Salt Lake Tribune is dragging this story out again, as I was under the impression that Gollum’s harsh wrist slap penalty for their instigatory role in the financial crisis was already a historical footnote at this point.
Senate probe: Goldman planned to profit from mortgage meltdown
Published Apr 26, 2010 05:35PM
Updated Sep 12, 2010 09:12PM
Washington
Goldman Sachs developed a strategy to profit from the housing meltdown and reaped billions at the expense of clients, a Senate investigation has found.
Top Goldman executives misled investors in complex mortgage securities that became toxic, investigators for a Senate panel allege. They point to e-mails and other Goldman documents obtained in an 18-month investigation. Excerpts from the documents were released Monday, a day before a hearing that will bring CEO Lloyd Blankfein and other top Goldman executives before Congress.
Blankfein says in his own prepared remarks that Goldman didn’t bet against its clients and can’t survive without their trust.
The Securities and Exchange Commission this month filed a civil fraud case against the bank, saying it misled investors about securities tied to home loans. The SEC says Goldman concocted mortgage investments without telling buyers they had been put together with help from a hedge fund client, Paulson & Co., that was betting on the investments to fail.
Goldman disputes the charges and says it will contest them in court.
At the hearing, Blankfein will repeat the company’s argument that it lost $1.2 billion in the residential mortgage meltdown in 2007 and 2008 that touched off the financial crisis and a severe recession.
…
And of course this begs the inevitable question…
At the hearing, Blankfein will repeat the company’s argument that it lost $1.2 billion in the residential mortgage meltdown in 2007 and 2008 that touched off the financial crisis and a severe recession.
Painful, that.
He won’t mention how much they made shorting the market or via TARP. He won’t mention how much they made prior to loosing money on residential real estate. All that matters is total returns and I’m sure you can shift the time frame of your losses very easily.
Didn’t everybody on this board plan to profit on the housing crash? My, we ARE evil, aren’t we?
(Of course, we weren’t spending other people’s money trying to inflate the bubble as big as possible to make more money on the downside.)
…nor were we counting on the taxpayer to cover our mistakes.
Me personally? No, I had no plans to profit from the housing crash. At least not for another 5 years.
I shorted Countrywide personally.
Sadly, I was too much of a scaredy cat to bet big or ride it all the way down into the ground, but it was satisfying for a short time.
I did ok. Thus Ben is on my free beers for life program. Ben if you need to collect, you know how to contact me.
Weekly World News is now online thanks to Google!
http://books.google.com/books/serial/ISSN:0199574X?rview=0&lr&sa=N&start=270
Note the lack of issues around 9/11 due to the anthrax attack on their offices.
Some people say the devaluation of the dollar.
Please finish your.
Hey there, Georgiagirl. Remember the seminar on hitting ‘Reply to this comment’ when replying to a comment.
My comment was some people say the next panic will be the devaluation of the dollar.
Surely you were replying to the comment ‘what will be the next panic’ that was in an above conversation ‘thread’. And, if you notice, your comment ended up way down here, where it made no sense. If you click the phrase ‘reply to this comment’ when you are replying to a comment, your comment will appear in the conversation you are engaging in, and thus, hopefully, make sense.
p.s. We all do it so don’t feel bad.
I don’t feel bad, I think Alpha gets irritated, but that’s fine with me.
Eddie’s wife?
Funny…
A victim and the victims victimized wife…. too funny.
Well…. I am in Atlanta.
Eddies wife
+2
Don’t forget to bring Aunt Pitipat her smelling salts.
Banks’ Plans for Foreclosed Homes Will Drive Market
http://online.wsj.com/article/SB10001424052748704505804575483844277697242.html
How do these “banks’ plans” get made? Do a bunch of cigar-chomping bankers all sit together in a big room and decide how they are going to dribble the massive overhang of shadow inventory onto the market in a way that lets them extract maximum profits from unsuspecting home buyers, who are unaware that prices are unlikely to recover for decades?
They sit in a room and figure out how many non-paying mortgages they can foreclose on before it decreases their bonus. They extend and pretend the rest.
Yup, in the good old days the banks could get the ratings agencies to rebundle these as AAA and then sell them off.
Sounds like the FED needs to reopen the barn door, I mean discount MBS windows and purchase these at full value.
TTT calls them up on the secret red phone and tells them that if they don’t do exactly as he says he will tell the world how insolvent they really are. Please don’t laugh, I really believe this to be close to true.
So do I.
(long-time member of the Tin Foil Hat club)
‘Prolonged intervention could backfire by creating uncertainty that keeps buyers on the sidelines. Extending foreclosure timelines also risks inducing more borrowers to default and live rent-free. Letting the market take its medicine sounds more appealing than it did 18 months ago. But it risks saddling taxpayers and the banking system with billions more in losses and trapping more borrowers in homes on which they owe more than the house is worth.’
The whiz kids at the WSJ are really pulling their hair out now. The search for an easy solution to the housing bubble eludes them and the consequences of kicking the can down the road are biting them in the ass. And here’s what the media never seems to grasp:
’saddling taxpayers and the banking system with billions more in losses and trapping more borrowers in homes on which they owe more than the house is worth’
Won’t those billions in losses be even larger as the system failed to purge the default inventory in a declining market? What do you suppose will happen to all the people you guys induced into buying these past couple of years?
..Won’t those billions in losses be even larger as the system failed to purge the default inventory in a declining market?
While the system as a whole is in the red, it is also generating income, unwinding and paying down it’s debts.
If old debt is paid off faster than new debt is generated, potential losses will shrink with time.
Letting the market take its medicine sounds more appealing than it did 18 months ago. … and it’ll sound even more appealing18 months from now.
The system is generating income for a few, at the expense of many. Looting does not make an economy healthier.
When push comes to shove, economic survival has no moral component… not for the few, and not for the many.
The “many” would happily chop the “few” to pieces and cook them for dinner if given half a chance.
Eat the rich!
“When push comes to shove, economic survival has no moral component… ”
I disagree. We humans are monkeys; we have a social system and are capable of feeling empathy for and looking after one another. Just because a few antisocial monkeys fling their $hit at everyone else doesn’t make it the norm.
Just because a few antisocial monkeys fling their $hit at everyone else doesn’t make it the norm.
It does if they have more than anyone else and and do it every single day.
There’s an old saying, “It only takes one idiot to screw it up for everyone.”
Our social system is very fragile. It tends to unravel given the slightest provocation.
we… are capable of feeling empathy for and looking after one another
Capable, perhaps, but I don’t see it happening. I do see a lot of blame being.. flinged?
The “many” would happily chop the “few” to pieces and cook them for dinner if given half a chance.
Are you suggesting that the few (who have far more power than “the many”) wouldn’t chop us up just as quickly, and serve us for dinner?
Haven’t they been doing that for decades (or longer) already?
After the election, when the latest group of lawyers with good hair also (surprisingly!) can’t figure out how to make trillions in debt magically disappear, maybe the people will force change. More likely they will just start saying “well, in two years, once we get a new president, he or she will fix it”.
Perhaps the truth is too painful to recognize.
It’s all good. Rumor has it Bristol Palin will be on Dancing with the stars. Oh, and what do think about season 5 of America’s got talent
Won’t those billions in losses be even larger as the system failed to purge the default inventory in a declining market? What do you suppose will happen to all the people you guys induced into buying these past couple of years?”
it might crash too fast if allowed to find a resonable level for the price of homes verus income and a fast crash would be the end of the whiz kids figuring out how to unload thier toxic bonds.
RE isn’t the only problem of the super debt bubble local and state governments look pretty broke here in CA.
Yes I imagine if they keep engineering fasle prices for RE a time will come when most folks won’t buy “for any price”
so much for the free market
But then again, if they were truly homes and not investments, they should be able to hang in there until the market recovers, right?
When you say “recover,” do you mean 1999 prices, or 2005 prices?
Too many people think we’re going back to 2005 prices and that the price declines were a “Black Swan” event. Those prices were never “real” in the first place. We need to move beyond the belief that “getting back to peak prices” is a good thing. It’s not. Those prices are what caused the system to fail.
. Since then, the renminbi has
Eddie’s brother?
Georgiagirl’s fraternal twin.
Solution to unemployment: Outlaw unemployment? This will also create more jobs for correctional officers, police, prosecutors, and bail bondsmen. Wow a new growth industry!
http://www.economist.com/node/16636027?story_id=16636027
Wow, even the guards have corn rolls. Yikes!
I think it’s corn “rows.”
I think it’s corn “rows.”
Yo Cap’m, U B right. Thanks!
Next thing you know they will trhow you in jail for not having a job.
I seem to recall that there was a scifi story with that premise. If you lost your job you were relocated to a reservation where you were fed and housed for the rest of your life with no option of returning to the real world.
One of Mr Felman’s clients, a fraudster called Sholam Weiss, was sentenced to 845 years. “I got it reduced to 835,” sighs Mr Felman.
Nice job.
Being poor is already against the law.
The “Land of the Free” has more people in prison that any other country in the world.
In fact, did you know that everyone breaks a law every day without knowing it?
Yes, you have rights. All the ones you can afford, that is. Can’t afford them? Too bad for you.
I do so every time I drive, going the flow of the traffic.
You have problem with Corporate Communist Capitalism©®™, comrade?
Can someone explain this to me
http://portal.hud.gov/portal/page/portal/HUD/press/press_releases_media_advisories/2010/HUDNo.10-190
seems like the first paragraph explains it.
non-FHA borrowers who are current on their existing mortgage and whose lien holders agree to write off at least ten percent of the unpaid principal balance of the first mortgage, the opportunity to qualify for a new FHA-insured mortgage.
if you’re a non-FHA borrower who’s managed to pay the bill so far, AND whoever owns the mortgage agrees to a 10% principle reduction (that’s the sticky part)… the FHA will allow you to apply for an FHA insured mortgage.
More stuff in the following paragraphs..like the house must be the homeowner’s primary residence
No guarantees, of course. What are the qualification? Does the underwater value/loan ratio need to be at least 5, 15 or 50% underwater?
All the requirements might be in that PDF file (6 pages which I’m not gonna read right now):
http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-23ml.pdf
I see you need at least a 500 FICO score..
Yes. It was a government program designed to hook FBs into making timely payments between March (when the program was announced) and September. If the FB paid on time during this period and is not more than 1115% underwater, they may now ask their mortgage holder(s) to write down their principal to the current market value of their house. Should the lender agree to this principal reduction (fat chance so long as the FB is current on payments), the government may offer the lender a guarantee on the new note.
oops… sorry. NEW LTV can’t exceed 115%.
115% today, but it will be extended to cover those who are as much as 1115% under water.
..Should the lender agree to this principal reduction (fat chance so long as the FB is current on payments)..
true dat.. it’ll require some real salesmanship on the part of the borrower.
Gotta convince the lender that, although the bill has been paid so far, the future is bleak unless something changes, and now’s the best time for them to do something about it.
I glanced at the PDF and there might be a few things about this program that would appeal to the bank or lender, depending on the lender’s priorities and current financial situation..
“I glanced at the PDF and there might be a few things about this program that would appeal to the bank or lender, depending on the lender’s priorities and current financial situation.”
Second leinholders are pretty much getting wiped out in foreclosures anyway. There is probably a small chance this program could be a little better for second leinholders than a short sale, depending on the borrower’s situation, how far underwater they are, and how cooperative the primary leinholder will be.
Still, principal writedowns for borrowers paying on time is going to be, as you said, a tough sell.
requires the consent of all lien holders
This will be the sticking point. With a HELOC on top of a 1st mortgage, few will qualify.
I do have a non FHA loan I have a VHDA loan. Just got to dig into this. my area got hit hard.
Sean, georgiaboy/girl…. what’s more to this charade?
What if you have a private mortgage? Will uncle Sugar offer to rework the goddamn thing or what?
Hey PB,
Don’t look now, but hi ho SILVER.
Silver up 11% in the past month.
Hey, it’s September 2008 all over again!
You mean my grille be apreeshee-ay-ting?
Almost all of the larger casinos in Vegas used to have these great 25 cent slot machines that spat out dollar sized 99.99 silver tokens complete with a coin case… usually with the casino emblem or some headline act imprinted on them. Maybe you win one.. maybe three at a time.
I guess their purpose was partly advertising, because the machines seemed to be set deliberately loose, and we managed to win lots of the tokens.
But with the price of silver rising, they got rid of all the machines.
Silver isn’t all that is going up:
Low In Supply, Used Cars Costing Drivers More
by Chris Arnold
September 13, 2010
A used car sits on the lot of John’s Auto Sales outside Boston. Prices for pre-owned vehicles have increased because of decreased supply, says an analyst with Edmunds.com.
With the economy stuck in neutral, auto dealers have been offering all kinds of incentives and deals on new cars. But prices for used cars have actually been rising quite sharply.
For example, the average price for a three-year-old Chevy Suburban is up more than 30 percent over last year’s.
According to Gary Collins, owner of Auto Brokers, a used car lot near Boston, buyers looking for a Ford F-150 extended four-wheel drive pickup with just over 100,000 miles would have paid at least $2,000 to $3,000 less last year than the current asking price of $13,500.
With the economy just barely growing, why are used car prices going up so much? As is often the case in economics, it has to do with supply and demand. According to Joe Spina, an analyst with Edmunds.com, there has been a decrease in the supply of used cars.
“The availability of cars is half of what it used to be,” says John Esterakis, who runs John’s Auto Sales, just down the block from Auto Brokers.
…
Highest Increases in Used Car Prices
Prices cited are for three-year-old vehicles.
Model July ‘09 July ‘10 Change
Cadillac Escalade $25,600 $34,715 35.6%
Chevrolet Suburban 20,262 27,193 34.2
Dodge Grand Caravan 11,661 15,629 34.0
BMW X5 30,711 40,843 33.0
Acura MDX 23,109 29,852 29.2
Source: Edmunds.com
i just don’t believe it..
Why should I? Is this any different than realtors claiming home prices are up because inventory is low?
Judging from the asking prices on cars.com our two older cars’ (2005 Saturn and 2006 Buick) resale values have held steady for the past couple of years.
Heavy appreciation does seem suspect however.
Asking prices are not falling at CarMax either..
but i tend to get really suspicious when sellers proudly say “Our prices are high and getting higher!”
The time to buy a used car is when they’re selling new ones like gangbusters and have their lots bursting with trade ins.
Of course the new chic is to drive the car into the ground and brag about how “even with 70,000 miles it still feels like its new”
—Of course the new chic is to drive the car into the ground and brag about how “even with 70,000 miles it still feels like its new”—
How ’bout instead, this is a “new” development of appropriate values, and in finding pride in being sensible instead of profligate.
Evildoc resides part time in Syracuse, part time in NYC. Special evildoc medical job pays three times in Syracuse what could earn in NYC, land of the bad physician salary.
$350k/income and huge pride here in having my 7 year old loaded-to-bear Accord couple EX (leather, 250hp, great ride) with 101,350 miles still going strong.
No car payment. Yep, the “chic”, car rides like when I bought it, feels great to climb into, feels like a well broken-in-glove, with seat now well shaped to match Evildoc’s posterior. No car payment for years now. So nice not to have debt.
Could buy new whatever tomorrow, in cash or with payments. Why? So for one week can have the thrill of something ‘new”, only then to have it feel the same for the next 7 years as what I feel each day with current car? For *that* I should toss out $40k for something new?
I’ll take this new “chic”, bragging (at least to myself) about how cool it is not to get sucked up into “keeping up with…”.
Great car, no payment. With monster taxes on my single guy no mortgage income, with gov’t giving my earnings to union workers, with years of unemployment benefits to folks’ supported by my brutal hours at work… I darn well will embrace this new “chic”.
If/when I get bored of the car, or maintenance becomes true hassle… i might get a replacement recent used car, even one with high luxury. But, i assert people on the whole would be well better off taking pride in maintaining a used car and driving it at length to milk the value from that horribly depreciating asset, instead of buying new toys they ill can afford.
If I bought new car tomorrow, it would lose fortune in value each year. My 7 year old 100k miles Accord loses very little value each year.
I LIKE this new chic.
Totally agree with you on the used car, doc.
Just one quibble: The govt gave FAR more money to bankers than they ever did (or will, even if the pensions are bailed out) to union members.
Let’s keep our eye on the ball. Our collective enemy is Wall Street and the financial elite. We should not allow them to pit worker against worker. You’re buying into their propaganda — designed to divide and conquer (U.S. workers).
A new TV series. The makers of “Flip this House” and “Pimp my Ride” have joined forces to bring us “Flip this Pimped Ride”
DH has been looking at used cars. I don’t know about price, but there is a plentiful supply of gas guzzlers. Smaller engine versions of the same model (where there was an option) are selling faster.
Small engine versions of big, heavy gas-guzzlers have a peculiar characteristic. They get the same or worse fuel mileage in the real world.
The lower powered engine has to work harder almost all of the time.. even just cruising along a flat freeway against the wind. A small engine belongs in a small car.
News from Tucson:
Slain man’s widow asks: Why?
Of interest to us is this part of the story:
Some of Piazza’s colleagues thought the shooting may have been tied to a civil fraud suit against him and several other mortgage and real estate officials.
While investigators are looking at every possibility, that hasn’t been connected to the case, Kelley said.
“Obviously, nothing is discounted until we find the suspect,” she said. “We don’t know if it was in the business world or not.”
And here’s some info about the aforementioned civil fraud case:
Terry Goddard Announces Settlements in Real Estate Fraud Case
Reminds me of “ghetto justice”; in the ghetto you can’t get away with ripping people off as easily as you can in other places because in “tha hood”, victims don’t bother to call the cops, get a lawyer… they go get “Ty- yeahIbeentoprison -qwaun” and offer him some “employment opportunities”
I lived in a scary baltimore hood for almost 2 years; there was very little rip off type of crime. But the taxi driver across the street was shot an killed one night. He was a nice guy and an actor; it scared me when he was killed.
A year later my nieghbor informed me that he was selling weed; then I understood.
This would be my guess as well. He probably destroyed someone’s life by wiping out their entire life savings and who now has nothing left to lose.
I’ve dealt with plenty of sleezeballs who wouldn’t think twice about taking everything you have and kicking you the curb. Got the scars to prove it as well. But they usually ended up getting their poetic justice without me having to do anything.
Eco, when I said “I understood” I meant he probably was “carpet bagging”; he may have been infringing on someones turf. “Destroying lives?”, I doubt it. White people sell weed legally in Cali all the time.
*it is good to be a white person*
I hear you, but I’m not talking about weed or any other vice. I’m talking about hucksters who lie about their “great” investments.
People get hurt all the time for ripping other people off.
The only good member of the REIC?
Can we have a brief moment of silence on the housing bubble to reflect on what really is important:
http://www.dailymail.co.uk/tvshowbiz/article-1311524/MTV-Video-Music-Awards-Cher-turns-time-familiar-costume.html
I would like to turn back time so I can get that 5 seconds of my life back, plus erase this horrible image from my head.
If I could look like her at 64, I’d be parading all around town in my birthday suit!
Payroll violations soar with down economy
State cracks down as companies skirt workers’ comp, overtime pay rules
Sacramento Business Journal
Cindy Mitchell, a contractor in the tile business for 20 years, had a hunch her competitors hadn’t been playing by the rules when she discovered some rival companies bid half the amount she did on recent projects.
Her hunch was confirmed by workers formerly employed by competitors.
“I’ve even had some of my employees tell me they have been paid in cash,” said Mitchell, president of Citadel Tile and Marble in West Sacramento. “They don’t want to report it because they don’t want to get in trouble. It makes it unfair for those who play by the rules.”
Pay violations are rampant according to Mitchell and many others struggling to compete in a cutthroat marketplace. They say companies are illegally slashing payroll expenses by paying workers in cash, skirting workers’ compensation requirements, shorting workers on overtime and violating pay rules on public works jobs. It’s done to drive down their bids to win jobs.
Complaints about such tactics are soaring even as the state rolls out a new program to fight them.
Claims of wrongdoing on public works projects, such as violating the state’s prevailing wage laws, are up 184 percent since 2006, according to the state’s Department of Industrial Relations. The number of complaints has increased every year since then as construction has slowed.
Wage and hour claims for non-public works jobs — when a worker might accuse an employer of not paying overtime — have increased every year since 2005 and are up 33 percent over that time.
So what else is new? Ive been reporting this forever so many “intern” jobs that used to be paid, and now they want you to have the latest laptop to work for free.
And we are talking major companies here ….not the small business with 2 employees
Methinks that it’s time for a massive sharing of this link, which comes from our friends at the IRS:
How Do You Report Suspected Tax Fraud Activity?
Share it early. Share it often.
What bullcrap. Pay violations have been common for decades. Nothing new here. It’s just harder to tell your boss to eff themselves in this job market.
Crackdown? More bullcrap.
Oh, and this a perfect example of what hard work will get you. Ripped off.
Sorry Eco you are wrong on this one…before you didn’t have to buy anything to get an internship, the company had usually the old computers, desks, tools for the “interns”….
In fact every DJ or company i knew or worked for, always paid even a rank newbie at least $50 and a meal….yet major profit making companies can rip you off forever.
off topic - feel free to substitute all instances of blonde with Democrat, Republic, TTT, etc.
A blonde female police officer pulls over a blonde gal in a
convertible sports car for speeding. She walks up to the car and asks the blonde for her driver’s license. The blonde convertible driver searches through her purse in vain.
Finally she asks, “What does it look like?”
The blonde police officer tells her, “It’s that thing with your picture on it.”
The blonde driver searches for a few more seconds, pulls out her compact, opens it and sure enough sees herself. She hands the compact to the blonde cop.
After a few seconds looking at the compact, the blonde cop rolls her eyes, hands the compact back to the blonde convertible driver and says,
“If you would have told me you were a police officer when I first pulled you over we could have avoided this whole thing!”
Thanx, that was funny.
But as a black person, I must confess some confusion regarding which white people are “targeted” for these kinds of jokes.
Red heads: “Im gonna beat you like a red headed step child”
Polish jokes, dumb blonds…
Some blond girls really are stupid, but so are a lot of girls; I thought it had more to do with bra size?
Very funny Spook!
Blondes are the only really white poeple, now does the joke make sense?
Here’s another one:
A blonde boards a jet airliner bound for Las Vegas with a coach ticket in hand. She procedes to the first class section and sits down. She is then approached by a flight attendant who informs her that she needs to move to her seat in coach, to which she replies:
“I’m blond, I’m beautiful and I’m flying first class to Vegas”
The flight attendant makes repeated attempts to move the disruptive passenger, but she won’t budge and continues to repeat her mantra. Finally the flight attendant calls the pilot, who exits the cockpit. As he approaches the woman she repeats:
“I’m blond, I’m beautiful and I’m flying first class to Vegas”
The pilot’s only response is to lean over and whisper something in the blond’s ear. The women rose and with an air of indignance she proceeded to her seat in coach.
The flight attendant was stunned and asked the pilot what he told the woman, to which he replied:
“I told her that First Class was going to Newark”
FB’s at Unlucky Ranchare feeling pretty down on their luck.
Brawley City Council tables decision on adding blighted subdivisions to RDA project area until Sept. 21
By SILVIO J. PANTA, Staff Writer
Wednesday, September 8, 2010 9:30 AM PDT
- Lupe Meier explains Tuesday that she and her family will remain in their Milano Court home at the La Paloma housing subdivision in Brawley.
- A model home in Matthew Homes has visible damage caused by recent break-ins and vandalism.
FERNANDO ACOSTA JR. PHOTOS
BRAWLEY — Sylvia Leon could hardly hide her disgust about how the two-story, five-bedroom dream home she and her husband bought nearly three years ago in the La Paloma subdivision soured on them when the land developer went bust.
Scattered weeds and dry brush dot the undeveloped piece of land in front of Leon’s Milano Court home. The streets are never swept and the air-conditioning unit in the home she and her husband, Raymond, paid more than $340,000 for malfunctioned six times during a 2 1/2-year period, they said.
“It’s like we’re forgotten out here,” said Sylvia, who added her family will “ride out” the hardships they face in a notoriously down economy where home sales have fallen to drastic lows. “I don’t know what the deal is. I don’t know what to do.”
…
p.s. We all do it so don’t feel bad.
I don’t
Oops - that was supposed to go up above.
Here’s a PR press release explaining how it’s different here. One difference is that instead of “snapping up” buyers in Brazil are “clamouring”.
Exponential Bubble-Free Growth for Brazil’s Property Market
http://www.prlog.org/10924988-exponential-bubble-free-growth-for-brazils-property-market.html
Sep 12, 2010 – In Brazil it’s actually both fun and rewarding to be an estate agent right now. Soaring economic growth (8.8% GDP for Q2 2010 – higher than anticipated) coupled with progressive government programmes aimed to give low-income families easier access to mortgages means that there are literally queues of people signing up for off-plan property.
With interest rates plummeting into single figures in 2010, mortgage lending has risen by 77% during the first half of the year in comparison with 2009. As a result the construction industry has outpaced GDP by growing 15% over the same period. But experts are adamant that this is not the onset of an unsustainable property bubble. For they have had the benefit of learning from the rest of the world.
“Brazil is not the US and neither is it Bulgaria, Spain or Dubai. Whilst US banks granted up to 130% loan-to-value, in Brazil these rates are being curbed to a far more sensible average of 60%. Meanwhile, whilst the booms of Bulgaria, Spain and Dubai were fuelled by, and dependent on, foreign speculators and holiday home hunters, the future of Brazil’s property market is assured by its own population.”
…eight million families, or 30 million people, do not have their own house to live in and are currently renting sub-standard accommodation. This need, along with subsidised mortgages for pool Brazilians, will generate demand for new homes for at least the next 15 years. uv10’s clients have little to fear when investing in off-plan property targeted to this ownership hungry audience.”
A burgeoning aspirational middle class combined with new access to mortgages adds up to unprecedented house buying with many clamouring up the property ladder and fighting for the best locations.
Just curious: If a 40% down payment is required how is everyone coming up with the money? Or are there “programs” for the lower classes that waive that requirement?
If a 40% down payment is required how is everyone coming up with the money? Or are there “programs” for the lower classes that waive that requirement? Colorado
From what I understand…there are programs waving high down payment requirements for the lower classes on new construction that is priced a determined fair profit margin above the cost to build. From what I’ve seen, the rent/buy ratios are very rational.
I believe the 40% down payment is the average skewed by the fact that a lot of people buy their homes here with cold cash and if they sells an existing home to buy a better one, they will put that cash into a new home way before they will put it in a bank or stock market.
In Brazil, homes have been, historically the only fail-safe way for regular people to preserve wealth from inflation, confiscation and corruption. These memories die hard.
Meanwhile, whilst the booms of Bulgaria, Spain and Dubai were fuelled by, and dependent on, foreign speculators and holiday home hunters, the future of Brazil’s property market is assured by its own population.”
Hmmm… has there been a recent spike then in Brazilian population then? Like - 77% more than last year?
Hmmm… has there been a recent spike then in Brazilian population then? Like - 77% more than last year?
No, mortgage lending has increased 77% in Brazil from 2009 but from a small base.
In the USA, total outstanding mortgage debt is equal to about 70% of US GDP.
In Brazil, total outstanding mortgage debt is equal to about 4% of Brazilian GDP.
It is such a huge difference, it is mind boggling.
Basically there was no such thing as home mortgages in Brazil until about 8 years ago. 90% of homes were bought for cold hard cash, and usually priced in US dollars.
Not anymore.
Just saying that something caused that 77% growth of mortgages - and it wasn’t the population demographics, and it wasn’t the delta between Brazilian and US mortgages, because neither of those change significantly in the past year. It was the plummeting interest rates mentioned.
Sound familiar?
I would conclude it’s a direct result of Brazil’s growing middle class.
It was the plummeting interest rates mentioned. Sound familiar? Packman
I would conclude it’s a direct result of Brazil’s growing middle class.
ecofeco
Yes it was both, PLUS (and interrelated) the fact that banks are willing to take longer term risks now that Brazil’s economy is no longer a basket case.
My old neighbors just bought a place in Brazil. They went looking last December, didn’t find anything they wanted, and went back in July and found that the condos/apartments they were looking at before were now out of their price range, so they quickly found something they liked and ’snapped it up.’
This after having bought a house in the San Fran bay area in 2005.
It is… boggling.
“clamouring”
Ok, that makes all the difference then.
Roidy
Oh Nooooo, does this mean it’s over?
Trump Realty Brazil Comes to Stay September 10, 2010
http://www.brazilcham.com/default.asp?id=248&c002_ui=sa&c002_id=1099
Trump, internationally well known as “Super Global Brand” – an alive brand with soul –finally decides to invest in Brazil.
The objective is to point Trump brand into the Top High Luxury Brazilian Real Estate Market. The Trump Realty Brazil’s focus will be the development of projects in commercial, residential and hotelier areas, as more than 70 projects built with Trump signature around the world.
“We have a promising future in taking our brand to Brazil”, says the North American businessman Donald Trump Jr., emphasizing that it could not be a better date and suitable moment to announce the new partnership.
…this moment is really favorable for Trump Realty Brazil arrival. The Brazilian real estate market lives new times: better, more auspicious and in a virtuous cycle.
“The Brazilian market excellence is well known worldwide. The development, the construction and the architecture are among the most advanced in the planet. Brazil is evoking international investors’ attention that intends to act in all Brazilian real estate areas. In the globalization era the long term foreign capital is really welcome,
Trump exports inflation to Brazil how nice now new buyers in Brazil who presumably work for money can compete with “free money” from Trump. I say free money because I’m pretty sure if Trump goes bust he dosen’t bother to pay it back. for all I know I’m on the hook for his debt ? And I can’t afford to pay it back no matter how high my taxes go.
Brazil is evoking international investors’ attention that intends to act in all Brazilian real estate areas. In the globalization era the long term foreign capital is really welcome,
Only developers, or buyers, too?
If it’s the latter, sounds like that “only to Brazilians” thing they mentioned above isn’t so true. And if sfbubblebuyer’s friends could buy there, does that mean any foreign “investor” or second-home buyer can buy as well, and with those cheap mortgages? Sounds like trouble; but of course, it could last for many, many years.
If it’s the latter, sounds like that “only to Brazilians” thing they mentioned above isn’t so true. And if sfbubblebuyer’s friends could buy there, does that mean any foreign “investor” or second-home buyer can buy as well, and with those cheap mortgages?
Any foreigner can buy in Brazil and own the land too. I did it. But you can only spend 6 months a year there if you’re not a legal resident.
I THINK, you can become a legal resident if you have 2K per month proven income/pension SS or 100K in assets or something.
Or marry a Brazilian.
Retired Supreme Court justice Sandra Day O’Connor is in the broadcast booth at Chicago’s Wrigley Field, having just delivered the game ball to the umpires on the field and now regaling the two announcers about a pet project: better civics education.
“I never thought I would see the day when we stopped teaching civics and government,” says O’Connor, wearing a royal blue Cubs jacket and keeping an eye on the field. “Now, it could be a little boring how they were teaching it. But nonetheless it is an important function of the schools. … Oooh, big hit there!”
www dot usatoday dot com/news/washington/judicial/2010-09-09-oconnor09_ST_N.htm
Have at least some schools stopped teaching civics and government?
Considering the vast majority of people never read an apartment lease or a car loan…or have any idea they lose by default if you don’t show up in court (Well i never got a notice),or tell a judge you’re broke and he will dismiss it, and years down the road they can attach your pay.
yes civics, government and your rights and obligations as an American are not as important as feeling good.
DD’s (elementary) school teaches social studies three days a week.
Tea Party Story ??
Read an article the other day.
A group of right and left types supporting Net Neutrality has become the target of the Tea Party
Gun Owners of America which had supported net neutrality was hounded into withdrawing their support by the Tea Party.
F’n amazing that they would get this fired up about a law that would keep internet providers from restricting or slowing access to information on the web. It’s clear this should have broad bipartisan support and is only hated by internet providers who would like to turn the internet into cable TV where you buy a package and pay extra for straying outside of approved content. HBB’rs could face higher rates and slower broken transmissions.
My guess is the millions from Verizon AT and T slush funds have bought off some people in this movement who then redirect the foaming mouths toward net neutrality.
If I had any doubts they were morons…
Where did they go?
414 mutual funds have vanished in the past year
http://www.usatoday.com/money/perfi/funds/2010-09-13-funds13_ST_N.htm
Low rates and a flabby stock market have taken their toll on mutual funds: 414 funds, most of them stock funds, have disappeared in the past 12 months, Morningstar says.
The Standard & Poor’s 500-stock index has gained 7.1% the past 12 months, but the market’s volatility has earned it no love from investors, who have been fleeing stock and money market funds and showering bond funds with new money.
Investors have pulled an estimated net $51 billion from stock funds since the end of May, says the Investment Company Institute, the funds’ trade group. They have put nearly $94 billion into bond funds during the same period.
As the investor tide has ebbed, some funds have been left adrift.
hmm.. 414 means nothing to me. What’s the average number of stock funds that go away in any given year?
..Bond funds, however, are flourishing. The ICI counted 1,271 taxable bond funds in July, up from 1,260 a year ago…
Time wasn’t too long ago that there were more mutual funds than publicly traded companies. I wonder what the ratio of mutual funds to publicly traded companies is now.
“Where did they go?”
Cayman Islands cash out? Just a wild guess.
Instead of creating jobs, America creates entrepreneurs.
Sour market forces homeowners to become landlords
http://www.heraldnet.com/article/20100912/BIZ/709129914/1005
DETROIT — A growing number of homeowners are finding out what it means to be a landlord after failing to sell their homes in one of the worst housing slumps in history.
With home prices down nationwide, many don’t want to take a huge loss when they decide to move. They want to wait to see whether they can rebuild their equity. So they rent.
“People just really don’t want to be landlords, and they really have no choice,” said Dennis Dickstein, a real estate salesman in Farmington Hills, Mich., who estimates that 20 percent of his deals are leases.
Mark and Rhonda LaVelle decided to buy a bigger home while the market was down. The couple had a 1,100-square-foot house in Royal Oak, Mich., to sell but decided to move when they found a 2,300-square-foot home about 2 miles away. They started renting their house in January after it had been on the market nine months.
“After paying two mortgages and the house wasn’t moving, we were at a point where we would have to sell it at a substantial loss or get someone else in who could pay the mortgage,”
“No real choice” other than selling the property for what the market will bear. But OH NO! They’re not going to just give it away! Instead they will accept cash in exchange for the right to live in the house while trashing it.
What all these ‘accidental landlords’ are going to discover is that renting a single family home, especially just one, is an extremely annoying process that only pays off if the is extremely cash-flow positive.
Everyone I know who rented a house out ‘for a year or so’ before trying to sell again has wound up with massive repair bills.
Everyone I know who rented a house out ‘for a year or so’ before trying to sell again has wound up with massive repair bills.
And, since very few accidental landlords know how to do the repairs themselves, “massive repair bills” is the key phrase of the previous sentence.
BTW, if they do know how to DIY, they’ll find that the fixit jobs will consume their evenings, weekends, and every other bit of spare time they have.
“Everyone I know who rented a house out ‘for a year or so’ before trying to sell again has wound up with massive repair bills.”
Oh yes! That’s what happened to my sister and BIL.
i guess the landlording thing is not as easy as it seems, and that’s why accidental landlords take it in the chops more often than not.
How do you screen tenants without getting into trouble? How do you prepare a house so it’s more or less immune to expensive repairs?
How do you screen tenants without getting into trouble? How do you prepare a house so it’s more or less immune to expensive repairs?
I’d suggest a slow and careful reading of Leigh Robinson’s book, Landlording. It covers all of the above in more detail than you’d care to imagine.
Takeaway: Landlording’s a tough business. So, be tough.
..Takeaway: Landlording’s a tough business. So, be tough..
a few days ago, az-lender was thinking about buying that place.. only my good manners prevented me from saying I didn’t think she had what it takes… she doesn’t seem like the type from what she posts.. although a 2nd mortgage lender no doubt skims the surface of that world.
i had a long speech all written out… Do you have it in you throw some single mother and her kids out onto the street.. etc.
Landlording Nov 2006
Amazon.. great reviews. The only complaints are that it’s “too wordy”.
“Every Landlord’s Legal Guide” (recently written May 2010).. was suggested as an alternative and earned even better reviews.. claimed to be as comprehensive as Landlording, it’s written in layman’s terms and gets right to the point… almost twice the price though ($27)
Great steady jobs there…unless part of that new house is going to be a viable video photo studio business …they are done
———-
said Mark LaVelle, 38, a freelance cameraman.He and Rhonda LaVelle, 37, a television-news producer
The couple had a 1,100-square-foot house in Royal Oak, Mich., to sell but decided to move when they found a 2,300-square-foot home about 2 miles away
Az Slim is a “freelance cameraman” of sorts, but I don’t think she would do something as boneheaded as these guys did.
Not on your life!
And one of the things I make very clear is that if you want me to do photography for you, it’s not going to be free. Meaning that I want money, honey.
You’d be amazed at some of the snippy reactions I get in return. It’s as if we love photography so much that we’re glad to take pictures for free in hopes of getting exposure.
I think it was Duke Ellington who said that you can get pneumonia from exposure.
Photographers get negatives from exposure……
Royal Oak is about 15 miles north of downtown Detroit.
That said, it is entirely possible that their old house will NEVER sell. It may be in the growing dead zone of ghost town Detroit.
However maybe they plan to walk away from the old house - maybe they planned to walk away even before buying the new house. It would make sense to buy the new house while your credit rating is still good, and then walk away from the old house at a later date.
Dennis Dickstein, a real estate salesman …
Some of this stuff you just can’t make up.
In my neighborhood I have seen a doubling of one man businesses in my field over the last year.
“You need a HELOC”, Valley National Bank, 2006
Jim Cramer’s Stop Trading! Buy AIG
TheStreet.com 08/09/07 - 02:55 PM EDT
Cramer likes AIG (AIG) because he believes the insurer owns “the right bonds” — not the ones tied to the subprime mortgage business — and because of its heavy share buyback.
You should see how he’s done on Cree lately.
Just bought a semi high end flashlight last night that uses a CREE LED.
Appears the stock is taking a bath.
The end is nigh! The end is nigh!
Time magazine paints gloomy picture of home ownership. We may have moved into the 4th inning now.
http://www dot time dot com/time/covers/0,16641,20100906,00.html
LOLOLOLOLOL.
I believe that would be the buy signal the HBB’s been waiting for.
(Or maybe it needs to be stronger than that - like a picture of a guy signing mortgage papers with a one-word headline: “IDIOT!” ?)
If this is the bottom, it’s a lot shallower than I thought it would be. Then again, the cover is just saying “may”…so there will probably be another one later where they decide for sure.
judging by the comments the American public is convinced the article is hogwash and home ownership is the way to go.
I fear we will never see the needed reforms like getting rid of the mortgage interest deduction.
I just finished Elizabeth Warren’s “The Two Income Trap” I think it should be on every soon to be family’s reading list. The US has changed, over bidding for houses in good school districts is a huge gamble.
Great post. In many ways, the two-income household has been detrimental to this country…and not just economically.
Totally agree. IMHO, the move to dual income households is one of the driving forces behind the inflation of the 70s and 80s, and it’s the period most people refer to when thinking about what housing prices do.
Unfortunately, the transition is complete, and the surge we saw from that movement will now dissipate. No more 26%/yr. house price increases for a while, IMHO.
so my wife was let go from her employer and given 3 months severence.
can she apply for unemployment at the end of those 3 months if the separation was structured as a “resignation”?
“can she apply for unemployment at the end of those 3 months if the separation was structured as a “resignation”?”
Did she have to sign a letter of resignation to get the three months severance?
Severance pay is not “employment”. If she does not have to work out those three months she is unemployed right now.
State law may vary, but….
She should go down to the UI people and ask right now. The lawyers use the term “constructive termination” or “constructive firing” to describe a situation where people are pressured into “resigning voluntarily”. Naturally the former employer won’t tell you about this because the UI dollars come out of their hide.
It may also depend on how the severance is paid out. Is she getting her normal paychecks for the next three months or was it a lump sum payment?
it was lump sum and yes…she had to sign a letter.
we live in VA btw.
i will tell her to make a call anyway. doesn’t hurt to ask.
Michael, she should not only make the call, but she should apply for unemployment ASAP. Expect the employer to challenge it. If she wasn’t the only person let go, then the sheer number of people leaving the company at the same time will probably be enough to convince them it wasn’t “voluntary”. If she was the only one let go (or one of two or three), then she probably hurt her chances by signing the resignation letter. But all they can do is say “no”.
I am sorry to hear this happened to her. I know it always feels worse when the employers try to play games. Good luck to you guys.
Maybe it’s my conditioning from signing logbook entries over the years, but I don’t sign squat unless I’m compensated for it.
Forcing someone to sign a “Letter of Resignation” is just chicken$hit, IMO. I suppose they held out the “carrot” of a severance package, in exchange for her “resignation.
Is there an MBA course titled “ChickenShit way to eff over and pi$$ off your employees”?
This could have an effect on Havana real estate. Maybe B.O. or The Fed will offer to bailout the Castro regime?
Cuba to cut 500,000 gov’t workers; reform salaries (AP)
HAVANA – Cuba announced Monday it will cast off at least half a million state employees by mid-2011 and reduce restrictions on private enterprise to help them find new jobs — the most dramatic step yet in President Raul Castro’s push to radically remake employment on the communist-run island.
Castro suggested during a nationally televised address on Easter Sunday that as many 1 million Cuban workers — about one in five — may be redundant. But the government had not previously laid out specific plans to reduce the work force.
The layoffs will start immediately and continue through the first half of next year, according to the nearly 3 million-strong Cuban Workers Confederation — the only labor union allowed by the government.
To soften the blow, it said the government would increase private-sector job opportunities, including allowing more Cubans to become self-employed, forming cooperatives run by employees rather than government administrators and increasing private control of state land, businesses and infrastructure through long-term leases.
The statement, which was published in state-controlled newspapers and read on government-run radio and television, said because of the sheer number of workers involved, the layoffs would come slowly, but that they would affect all government sectors.
It did not say which parts of the economy would be retooled to allow for more private enterprise. The union said that the state would only continue to employee people in “indispensable” areas where the labor force is historically insufficient, such as in farming, construction, industry, law enforcement and education.
In August, Castro warned that layoffs would be coming and said Cuba would expand private enterprise on a small scale, increasing the number of jobs where Cubans could go into business for themselves.
Wow, been waiting a lifetime for some steps in that direction.
Veddy Intelesting.
Cuba is a huge opportunity in waiting, for tourism at least.
and for freedom.
Yes.
I was friends with a Cuban guy near Miami a few years back. If/when “the wall comes down” in Cuba there will be dancing in the streets.
(And pretty dang good dancing, at that)
(And pretty dang good dancing, at that)
Not to mention the music that will accompany the dancers.
But sorry, Cuba. You can’t have Arturo Sandoval. We’re keepin’ ‘im.
Arturo Sandoval is a trumpet genius.
I want a beach house in Cuba!! Sign me up!!!!
Canada and Germany beat the USA too it.
Canada and Germany beat the USA too it.
Canada and Germany beat the USA to the Cuban market and beaches for the same reason Canada and Germany have universal healthcare and the USA doesn’t.
It’s because on these issues, Canada and Germany did not let self-serving, political nutballisms trump economic practicalities.
So will Fidel actually turn into a Latino Deng Xiaoping?
I read another article about him over the weekend that suggested he had a “come to Jesus” moment during his long illness.
jeeze.. Raoul is opening the door to private enterprise. Imagine.. a mini-China.. right next door.
Agreed, I think Castro likes what he sees with regards to the Chinese model of state sponsored capitalism.
“To soften the blow, it said the government would increase private-sector job opportunities, including allowing more Cubans to become self-employed, forming cooperatives run by employees rather than government administrators and increasing private control of state land, businesses and infrastructure through long-term leases.”
Florida, and particularly Miami, better start gearing up for the Mariel Boatlift 2.0. Cuba can blather all it wants about “softening the blow”, life already sucked for many in Cuba before this. They’ll be comin’ here, and that’s the program, pure and simple. Unlike illegals from South of the Border, if you’re from Cuba and can make it across the states and touch dry land before the Coast Guard finds you, you’re home free.
Jimmy Buffet says no double dip:
http://finance.yahoo.com/news/Buffett-Rules-Out-DoubleDip-bloomberg-2228875511.html?x=0&sec=topStories&pos=main&asset=&ccode=
I tend to agree that the economy need not suffer another serious downturn, but with one qualification: The real estate market must be very carefully numbed and then amputated.
Well I guess our lords and masters, er, the rich, can heave a sigh of relief now.
In the UK the new normal is a return to the old old normal.
“First-time buyers are struggling to get on the property ladder as banks further tighten lending criteria.
These buyers have a typical deposit of 24 per cent of the value of their home, up from 21 per cent in April.”
http://www.telegraph.co.uk/finance/economics/houseprices/7999619/First-time-buyers-hit-new-low-amid-house-price-fears.html
Called deflation.
National Debt Increased by 81% under Bush:
2001 - $5.871 trillion
2008 - $10.640 trillion
National Debt Increased 24% Under Obama:
Jan 31st 2009 = $10.569-Trillion
June 30st 2010 = $13.149-Trillion
But of the $2.6-trillion increase, 98% was carry over from Bush programs:
Bush: $607-billion = Interest on Debt 2009/2010
Bush: $240-billion = Iraq War Spending 2009/2010
Bush: $319-billion = TARP/Bailout Balance from 2008 (as of May 2010)
Bush: $419-billion = Bush Recession Caused Drop in taxes
Bush: $127-billion = Bush Medicare Drug Program 2009/2010
Bush: $141-billion = Bush Meicare Part-D 2009/2010
Bush: $514-billion = Bush Tax Cuts 2009/2010
Bush’s contributions:
2001 to 2008: $4.769-trillion
2009 to 2010: $2.367-trillion
Total: $7.136-trillion
Obama only contribution: $580-billion = Stimulus Spending (as of May 2010).
Lol…. Obama didnt want to spend 3 trillion in one year …. all the fault of Bush….that is so funny.
I have a bridge you should buy from me too.