Bits Bucket For October 12, 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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Foreclosure threatens proposed tallest U.S. tower
Lender files foreclosure lawsuit against the Chicago Spire’s developer
CHICAGO — Plans to build the tallest tower in the nation are in the balance after a lender filed a foreclosure lawsuit against the Chicago Spire’s developer.
Crain’s Chicago Business is reporting that Anglo Irish Bank Corp. filed the $77 million lawsuit against Irish real estate developer Garrett Kelleher this month. The lawsuit alleges that Kelleher’s Shelbourne Development Ltd. has defaulted on loans that matured a year ago.
Anglo Irish is expected to take possession of the 2.2-acre site overlooking Lake Michigan. The Irish government took over the bank last year.
A call seeking comment from Shelbourne Development was not immediately returned Monday.
Ground was broken in 2007 for the 2,000-foot Chicago Spire designed by Santiago Calatrava. The site has been dormant since 2008.
I wonder whether there’s a similar hole in the ground in most major cities. I know that Boise has had its famous “hole” for over 20 years now.
http://www.boisearchitecture.org/structuredetail.php?id=114
I wonder whether there’s a similar hole in the ground in most major cities.
No holes here in Vegas, but we have at least three spectacular steel skeletons and several see-through skyscrapers.
Sacramento has a huge hole at 3rd and Capitol. Tallest building in Nor Cal was going to be condos and a hotel on the lower floors. Guess who is holding the bag? PERS. Public Employee Retirment System for CA.
Guess who is holding the bag? PERS. Public Employee Retirment System for CA.
Retirement Village Towers?
“We can’t pay your pension, but you get a free place to live”
Sounds like a good place to bury the bodies.
The hole has been dug. Now all that’s needed is fill.
Walked by the site on a gorgeous fall afternoon this past Sunday. It’s still a smokin’ hole in the ground surrounded by a fence. We walked the “river walk” and also saw two other noteworthy sights.
On the south bank of the river out near La Salle St. is a hulking frame of a skyscraper that was supposed to be a hotel/condo mix - I posted not long ago about it being possibly torn down. Imagine that - an entire skyscraper being “bulldozed”.
Meanwhile at Trump’s tower - the retail space was vacant - and I mean vacant. Colorful shrink wrapped pictures covered all the windows on what was supposed to be teeming retail space along the river.
North Carolina right EJ ??
Chicago, scdave.
Okay…Sorry…I think I have asked you before but I just forget… Chicago…My favorite city in the USA…:)
In Orlando (specifically Altamonte Springs) there is this giant glass commercial 20 story building right next to I-4 that was built in the late 90s and never got finished (even during the bubble, which to me is just hard to fathom). The thing is a major eyesore and I wonder what will eventually happen with it.
In Orlando (specifically Altamonte Springs)…
Coincidental (non-hBubble) story today in Slashdot on Altamonte Spgs.
Interesting story. A data record storage center near San Jose uses the old train tunnels that once connected San Jose to Santa Cruz. The train route was abandoned after building Lexington reservoir, through which its bottom the train tracks ran.
Suck them in one day, shake them out a few days later.
Here’s headline from today’s Yahoo Finance:
“Stocks drop as Fed rate-setter warns on stimulus.”
Stocks prices are dropping, says the article, due to pending monetary stimulus from the Fed.
But just a few days ago it was reported that stock prices ROSE due to pending monetary stimulus from the Fed.
Yellen’s comments are most curious. Yesterday I read that 93% of polled traders are expecting decisive Fed action on the 3rd. Fed action is being reported as an absolute certainty in many, many articles recently.
I think it’s a manufactured dissent. Fed has to pretend that there’s some debate going on.
I wish you weren’t right, but you probably are. Sigh.
‘mericans love issues that are “too-close-to-call”.
Hate to say it, but I also think you’re right.
Rising prices entices people to buy, falling prices entices people to sell.
There are very few places other than on Wall Street where this is true. It is not true in the grocery store nor on the car lot, but it always seems to be true on Wall Street.
That’s because equity prices are almost entirely speculative. the main reason that you buy groceries or a car is because of the use that you intend to get out of them. OTOH, very few stocks are priced in such a way that dividends make their purchase worthwhile. Instead they’re bought on the idea that you can sell them later for more than you paid for them.
“Instead they’re bought on the idea that you can sell them later for more than you paid for them.”
… to people you don’t know who are more optimistic than you are. If this optimism suddenly runs dry (or even slowly runs dry) then you are stuck with whatever it is you bought.
And this is the basis that one should rely on when he invests thousand of dollars of his hard-earned money?
Of course it is! What are you, some kind of dang socialeest/commie?!
The only way Wall Street can possibly stimulate demand is to convince greater fools they will be able to sell later for a profit. The only way to do this is to show the fools that prices are rising today.
Once everyone is convinced that “this sucker is going down,” what could possibly motivate them to catch a falling knife, other than contrary evidence that prices are rising? This is where it is handy for Wall Street to have the Greenspan/Bernanke put backing them up.
Everyday more and more seniors are drawing on their 401k’s - is that money being replaced in kind by younger workers?
I’m intimately familiar with one such senior, and lemme tell ya - she’s taken out a whole lot more than this slacker will ever put in. It was just distribution time two weeks ago - and today the boyz have a teensy less OPM to play with than they did a month ago.
Everyday more and more seniors are drawing on their 401k’s ??
And are putting any other liquidity in only the safest spots (i.e. Bonds)…To hell with yield, I want to wake up each morning and know that the money is still there…That, at least, is what I see going around in some of the circles that I run with…
“Everyday more and more seniors are drawing on their 401k’s - is that money being replaced in kind by younger workers?”
Don’t 401k’s only go back to the 1980’s. The number and percentage of workers covered by such plans has increased substantially since then, even accounting for cutbacks by companies and individuals in such plans and contributions in the past few years.
Hence the amount being drawn out should still be substantially less than the amount of new funds being put in. But in both cases, it doesn’t have to be in equities. For example, mine’s all in treasury equivalents at the moment, but has had different mixes over time.
I guess the point of all of the above is I don’t think the amount being drawn out of equities by the current set of retirees is enough to have any significant impact on the market. As mentioned by scdave above, however, there could well be a shift out of equities and into other asset classes, whether by retires or current workers.
Now in the years ahead as the number of retirees increases as well as the number of retirees with 401k plans and more significant amounts in those plans, the collective impact on the markets could well be more significant. I’m guessing you’d have to get toward the tail end of the boomer retirements before outflows would exceed inflows and by then that may not have much impact on the markets relative to other factors.
The only way Wall Street can possibly stimulate demand is to convince greater fools they will be able to sell later for a profit. Well they could pay dividends, but of course most companies can’t afford to pay dividends sufficient to make current stock prices make sense as an investment.
Don’t 401k’s only go back to the 1980’s? Well the great baby boomer fueled stock market tide was also affected by the investments made by pension plans. Those too are going to be seeing net pay outs rather than pay ins soon.
SDGreg,
Good points. What I’ve tended to notice over the years is that the employees at the upper end of the income scale deplete their accts. at a quicker rate.
The avg. acct. bal. is so woefully inadequate to properly retire, I think ( those that haven’t already cashed in, 2007-2009 ) will likely leave well enough alone for now.
In many cases, there just isn’t enough ‘there’ there to worry about? The other thing that’s so misleading about all the data is that we don’t take into account all the ppl that don’t even HAVE a 401K! If we calc’d that in avg. bal. would be almost non-existent. What are we so worried about again?
http://money.cnn.com/2010/10/08/pf/expert/investing_401k.moneymag/
I’m 48 with no 401(k). How do I retire at 65?
You don’t……..you keep working, if you can.
Welcome to the club.
…and it’s a VERY big club.
Well, you see, young and energetic immigrants will be thrilled at the chance to assume the costs of your golden years. That’s the Establishment’s story and they’re sticking to it.
“Instead they’re bought on the idea that you can sell them later for more than you paid for them.”
Kinda like houses, huh?
Wow…..just like houses.
Oooops, I guess I should read further before responding. Maybe we could have a house market exchange where you could by houses just like stocks.
What about real estate? It always goes up.
Remember when precious gold broke up through $1000? Buyers stepped in buying with both hands. Goes under $1000 and buying stops.
I believe that this is an American phenomenon certainly not Asian.
doesn’t alot of people buying something move the price up…if supply stays the same?
it’s not that people buy when stocks are high…it’s that stocks are high cuz people are buying.
Trouble is, the supply is hardly flat.
Goldman Sachs Analysts Forecast $1,650 Gold In 12 Months
http://tinyurl.com/24haw62
(Kitco News) - Goldman Sachs has raised its 12-month forecast for gold to $1,650 an ounce, citing expectations for further quantitative easing in the U.S. and prospects for long-term interest rates to continue falling.
“With U.S. real interest rates pushing lower off the slowdown in the pace of the U.S. economic recovery and the growing prospect of another round of quantitative easing, we expect gold prices to continue to climb,” said the Goldman report, authored by David Greely and Damien Courvalin. “Despite the rebound in net speculative length, it remains well below levels consistent with the current low U.S. real interest rate environment.”
Goldman said the decline in U.S. real interest rates is likely to persist, and rates could push even lower in the near term should the Federal Reserve undertake quantitative easing measures. Thus, Goldman said it is raising its gold price forecasts to $1,400, $1,525 and $1,650 on a three-, six- and 12-month horizon. Goldman said its updated forecasts point to an average of $1,575 an ounce in 2011, which is $175 higher than it previously expected.
“The return to quantitative easing will likely be a strong catalyst to drive gold prices higher, and we expect the gold price rally to continue until U.S. monetary policy begins to tighten,” Goldman said.
The bank’s economics team expects the Fed to return to quantitative easing with purchases of U.S. Treasury securities of $1 trillion, which in turn should keep U.S. bond yields depressed. Furthermore, the bank said it expects the announcement at the Federal Open Market Committee’s Nov. 2-3 meeting.
Goldman said the rally since August came as the yield on 10-year U.S. Treasury Inflation-Protected Securities plummeted, with the yield now closer to the 0.50% than the 1.0% imbedded in prior forecasts. It also cites stronger demand for the metal for gold exchange-traded funds and from central banks.
However, while Goldman said gold could rally for an “extended period,” it also sees a “considerable downside risk” in the longer term, should the Fed eventually tighten monetary policy earlier than expected.
For now, Goldman said, its U.S. economists suggest that it could take until 2015 or longer before a rate hike becomes “appropriate,” although they emphasize this is not a “formal forecast.”
“While they do not expect tightening to happen before 2012 at the earliest, we view an earlier-than-expected tightening of U.S. monetary policy as the primary downside risk to our gold price forecasts,” Goldman said.
Will that be accompanied by the $250 bbl oil they predicted two summers ago?
I’ll have to check, but JPM or Morgan Stanley predicted $1250 gold by the end of 2010 a year or two ago. Some of these big investment organizations are right. Or are you telling us that you are more qualified than their analysts are?
” Or are you telling us that you are more qualified than their analysts are?”
I think that monkeys throwing darts are more qualified.
No, not at all. But all this talk of the precious appears to be happening in a vaccum. If Uncle Buck really is so sick to allow for $1,650 gold - then people ought to be preparing for higher fuel prices - and doing so now.
”Or are you telling us that you are more qualified than their analysts are?”
Is this a trick question?
Yes, but with Benny and the Helicopters spewing inkjet dollars, how much will a loaf of bread or a gallon of gas cost 12 months from now? That’s the real question, not what an oz of gold will fetch.
Shh…Don’t tell ComboTechie. He only has cash.
Half of Wall Street Expects Bigger Bonus in 2010
October 11, 2010, 1:21 PM EDT
Michale Moore
Oct. 11 (Bloomberg) — Half of Wall Street finance professionals surveyed expect their bonuses to increase for 2010, eFinancialCareersdotcom found.
About 71 percent of the 2,145 people who responded to the e-mailed poll in the U.S. said they are anticipating at least an equal bonus from last year, with 50 percent expecting a bigger payout, the job-search website said in a statement. About 11 percent said their bonus will jump by at least half, according to the survey.
There has been a lot of recruitment activity this year, and that recruitment activity is part of what is driving expectations,” Melrose said. “You still have to pay for performance, and you have to pay to keep your competitive edge.”
In the first six months of the year, Goldman Sachs Group Inc. set aside $9.3 billion for total compensation, down from last year’s record $11.4 billion. JPMorgan Chase & Co.’s investment bank allocated $5.3 billion versus $6 billion a year earlier, and Morgan Stanley’s investment bank set aside $3.5 billion, up from $3.1 billion. All figures exclude U.K. bonus tax costs.
Of the U.S. respondents who anticipate a bigger bonus, 33 percent attributed it to their firm’s performance and 34 percent said it’s related to personal accomplishments. About 37 percent said pay is the most important factor in their decision to work in the industry.
They get a bonus, we get a bone-us.
They expect to be rewarded lavishly for their steller job of regulatory capture.
Well, you are supposed to get a bonus when you get profits for your company, so….
Why would bank managers bother to take the trouble of running a profitable operation, if they knew they could get huge bonuses by running their operation at a loss? So far as I am aware, it is far easier to lose money than to make money.
It depends on the details of the executive compensation contracts. They get bonuses whether they make money or not, but it is likely that the amount of money assigned to the bonus pool is a bit larger when they make money.
“…but it is likely that the amount of money assigned to the bonus pool is a bit larger when they make money.”
So it gets down to the marginal value of a dollar after you have already made millions, versus the disutility of effort relative to smoking pot, visiting hookers or playing golf in one’s leisure time?
Or why wouldn’t a manager go to Vegas and put all the companies money on red if he knew he was guaranteed a bonus no matter what.
Er, Measton, they already did that five years ago.
2010-10-12 07:25:57
Or why wouldn’t a manager go to Vegas and put all the companies money on red if he knew he was guaranteed a bonus no matter what.
Derivitives == Roulette
“Derivitives == Roulette”
Derivatives = Cult,…read their name tags.
Derivatives = Meth-injected printer on crack.
But with derivatives, who collects on the green 0 and 00?
who collects on the green 0 and 00?
Odd ain’t the lil’ ball seems to be landing there when the most amount of money is stacking up on the “house’s” table?
They deserve a big bonus. What they do is so much more important than what we do.
Da Boyz on Wall Street are only doing jobs immigrants won’t do.
“Half of Wall Street Expects Bigger Bonus in 2010″
This is starting to resemble those LA home owners who, in a 2003 survey, showed a median belief that they would see the value of their homes go up 23.4% a year for the next decade.
We can only hope. They do own our government, after all.
They’re in denial, according to Crain’s New York Business.
http://www.crainsnewyork.com/article/20101011/FREE/101019990
Last month, Sanford C. Bernstein & Co. analyst Brad Hintz attended a party with his former partners at Morgan Stanley at the Metropolitan Museum of Art’s cavernous hall housing the Temple of Dendur. After a few drinks, a senior executive opened up to Mr. Hintz and said that to offset this year’s fall in revenues due to the crummy economy and rise in operating costs from stricter regulation, pay would have to decline in the next few years to “1990’s level.”
“I said, ‘You mean 2000,’” Mr. Hintz recalled.
“No, we’ve run the numbers and it’s 1990,” the executive said, adding that bankers were plenty well-paid back then.
No problem. Those in the higher paygrades will continue to get bonuses, and those below the cutoff will have their compensation “right-sized”.
It’s easy to ignore pizzed off people when you work in Connecticut, or Manhattan, and they work in BFE. Time will tell on how that works when they are in the same building.
Look for the video-conferencing budgets of the Banksters to increase.
Of course WS bonuses will be high this year. WS is having a hell of a good year and the people that are making that happen will be compensated.
At least these employees produce value for their employer. What do govt union members making $40, $50, $80 an hour (including bennies/pension) produce? Nothing. In fact they produce less than nothing as they get in the way of those who do try and produce.
BTW is it Nov 3 yet?
What do govt union members making $40, $50, $80 an hour (including bennies/pension) produce?
Besides the consumer economy that drives the entire world?
Govt union members drive the economy of the world? Oh man, thanks for the chuckle. I needed that.
Those leeches do nothing but destroy everything they touch.
Those that can’t, teach. Those that can’t teach, teach gym. Those that can’t teach gym work for the government.
Those that can’t, teach. Those that can’t teach, teach gym. Those that can’t teach gym work for the government. Eddie
And the yipping posts of those who can’t persuade effectively (mainly due to being wrong) oftentime resemble a confused and scared chiuaua barking at a baby carriage.
Kinda long, but this is the best explanation of the ‘Flash-Crash’ I’ve read yet. Although it raises a lot more questions than it answers.
The Real Flash-Crash Culprits
by Jim McTague
Monday, October 11, 2010
Barron’s
MEET THE FLASH-CRASH scapegoat. A report by regulators blamed May’s spectacular market break on a single trade by a single “mutual fund complex” identified in the press as Waddell & Reed.
The “Findings Regarding the Market Events of May 6, 2010,” by the staffs of the Commodity Futures Trading Commission and the Securities and Exchange Commission,said that although volatility was rising and sellers began to outnumber buyers, a mutual-fund complex initiated a program to sell some 75,000 E-Mini contracts on the Standard & Poor’s 500, valued at $4.1 billion, as a hedge to an existing equity position. E-Minis are electronically traded portions of regular futures contracts. The regulators faulted this fund complex for using a program to feed orders into the E-Mini market at an execution rate of 9% of the total trading volume, and without regard to price or time.
HERE’S WHERE THE REGULATORS’ story starts to fall apart. CME Group, owner of the exchange where the E-minis trade, said the sell order was consistent with market practices. Furthermore, only half the order had been entered as the market fell. And it had been broken up into small orders—nine out of every 100 coming into the market. In any event, this one trade couldn’t have spooked investors because the market is anonymous. Traders didn’t see a single, large seller. What they saw was continuous action.
The fact is, high-frequency traders and brokerage houses acting as market makers did more to drive down prices. They stopped buying and started selling.
The brokerage firms’ behavior was particularly galling, though by no means illegal. They stopped automatic execution of customer orders, also known as internalization, which on most days accounts for nearly 100% of retail trades.
A brokerage firm will try to match one customer’s order with that of another customer in-house. If the firm can’t make the trade, it sends the order on to an executing broker. The big ones are Knight Capital, Citadel and UBS. The executing broker will generally take the opposite side of the customer order because retail customers tend to buy high and sell low, so it’s easy to make money off them.
In the rare instances when an executing broker demurs, he sends the trade to a dark pool, usually one owned by his firm. (Dark pools are electronic-trading venues where institutional investors trade stocks away from the public stock exchanges.) If the dark pool can’t execute the trade, it is sent to one of the stock exchanges. This largely automated process occurs in sub-seconds.
On May 6 when the market fell out of bed, the report says blandly, some of these players reduced executions of sell orders but continued to execute buy orders. In other words, they’d sell stock to a retail customer but wouldn’t buy stock from a retail customer. They wanted to get rid of their own inventories, not accumulate more shares. So they sent the customer sell orders onto the swamped stock exchanges.
Here’s one measure of the damage: Twenty thousand trades, totaling 5.5 million shares, were executed at a price 60% or more away from pre-Flash-Crash price levels, and thus later were deemed invalid. At least half those were retail orders. And, of course, that says nothing of the countless trades done at discounts of less than 60% but still large.
IT WAS A VICIOUS CYCLE. Retail stop-loss and market orders were converted to limit orders by internalizers prior to routing to the exchanges. A limit order requires the trade to be executed at a specific price, whereas a market order is the best price available. If the limit order wasn’t filled because the stock’s price had fallen, it was kicked back to the internalizer who, in turn, set a new, lower limit price and resubmitted it. Orders were kicked back multiple times because prices were collapsing so rapidly. They followed the prices down, “eventually reaching unrealistically low bids,” as the report puts it.
Sounds to me like the ‘market makers’ refused to make a market when they saw prices dropping like a rock. But what’s even more puzzling, is why the ‘internalizers’ converted retail stop-loss and market orders to limit orders.
“… retail customers tend to buy high and sell low, so it’s easy to make money off them.”
The pain is on you, buddy; Retail customer volume is dropping.
It all goes to show, whether one is playin’ with the Wall St. boyz or showering at a prison - it’s equally important not to drop the soap.
“Sounds to me like the ‘market makers’ refused to make a market when they saw prices dropping like a rock. But what’s even more puzzling, is why the ‘internalizers’ converted retail stop-loss and market orders to limit orders.”
What puzzles me is why the market-makers did not have a prior agreement with the exchanges as to what defined a “disorderly” market. Knowing a priori that 60% declines would be the point of trades being cancelled, the market makers would have been buying hand-over-fist at 59% off.
What good is a market-maker if they don’t make a market?
What good is a market-maker if they don’t make a market?
As a good customer for escorts, drugs and poseur fashion?
What did the realtor say to the homeless street beggar?
-Can you spare some change?
-Are you throwing money away renting a cot at the relief center?
Don’t blame me, YOU signed the mortgage.
Real estate is all local. Why don’t you go beg in some other locality?
I was in professional school, the first time it occured to me that my net worth was vastly lower than that of the homeless people who begged for change on the streets of New York. I assumed that they were basically broke, but I my net worth was negative the instant that I signed my first set of student loan promissary notes at the bursars window. The bucks I had in the bank and my other modest posessions wouldn’t have started to cost of that first semester’s tuition. I, of course, was in the process of shoving a qualification in my brain that would allow for great cash flow over the summer and in about 3 years, but during that time, my asset level was very negative, while I expect that their debts were few.
Needless to say, I was not very happy with the realization, but it took a full 6 years (3 getting into more debt and 3 paying it off) to fix the problem.
polly,
And that needn’t become some dry lecture on the virtues of good debt vs. bad debt. I just see so many young ppl that are unwilling to even invest in themselves as they’ve convinced themselves there won’t be a world to inherit?
Why invest in anything but spirituality what with the rapture coming and all!
But salvation is free! At least that’s what Fundy pastors say as they remind their flocks to place their tithe on the collection plate.
Good point. To be perfectly fair, I was already a reasonable computer programmer when I started law school, so if you included the present value of what I could earn based on what was stored in my brain in the net worth analysis, I expect it wasn’t ever really negative. And once I passed my bar exams, that number want up significantly. But that is a hard number to quantify, and so most people generally leave it out.
As for the young folk? Well one poster here likes to talk about duration. Two years is a long time in the life of a 17 year old. If a kid sees investment in self not helping the adults around him for an extended period of time, they might start to discount the importance of it. It isn’t very far sighted, but that isn’t usually a teenager’s first best talent.
I wouldn’t say I enjoy talking about “duration” it’s just that the duration of these events is what really winds up taking the greatest toll. And you’re right, that does need to be pointed out from time to time. After a while the headlines and numbers are there solely for entertainment value.
As for the youth, there are hopeful signs too. Maybe they’re seeing for themselves what a sham the ponziconomy has become? There’s some evidence they are rejecting the consumer economy - or in the very least reordering their priorities. Nothing at all wrong with that, in fact mother earth would probably be relieved if they are.
The postwar era - the only era most of us know - is over, for good, bad, or otherwise. At this point we probably should admit that the stock bubbles, RE bubble, higher ed bubble, etc. were largely the result of a sense of entitlement/permanency that morphed out of that unprecedented era of peace and prosperity.
While that might scare a lot of people who grew up in that era, the youth will have to survive in what comes next. So perhaps the appearance that they are not investing in themselves is being mistakenly based from the observation that they aren’t investing in the assumptions of the past?
‘the youth will have to survive in what comes next’
Maybe it would help future generations to get the terms right. Explain to me how higher education is a ‘bubble’? My understanding is that ‘bubble’ refers to a financial mania. I’ve long felt that student loans and the cost of college didn’t make sense for many young people. But it doesn’t contain elements of a mania, IMO. I think it’s confusing to call everything that gets out of whack a bubble or a mania.
I see this all the time and thought I’d put in my 2 cents.
“I think it’s confusing to call everything that gets out of whack a bubble or a mania”
Thanks Ben, I feel the same. There’s no doubt higher ed. has gotten a lot more expensive over the years, but it was on that trajectory w/without The Housing Boom.
Generalizing only leads to more generalizing, IMHO.
Well just for sake of argument Ben, bubbles tend to happen when supply is more slow to adjust than demand. And then supply ramps up until there is more supply than demand. Starting with the GI bill, the post war period has seen an ever expanding demand for college graduates. Does getting s pschology degree really help you manage a beauty supply store? Not really. But it’s MUCH more difficult to GET that job without a college degree. Arguably we don’t NEED as many college graduates as we have, but since we have them, employers ask for them.
Outside of technical fields, for the most part, college is an expensive and time consuming test of one’s ability to communicate with others and get work done. If employeers ever decided that they could simply hire the same high school graduates before they spent four years drinking beer and amassing debt, the demand for college degrees would plummet.
“To be perfectly fair, I was already a reasonable computer programmer when I started law school, so if you included the present value of what I could earn based on what was stored in my brain in the net worth analysis, I expect it wasn’t ever really negative. ”
Interesting concept, polly. Instead of measuring net worth (e.g. market value of your possessions), look at “net present worth”: the net present value of everything you possess or will possess in the future, discounted back to the present.
The one hitch is that the values of things you possess in the future change over time, so what value should you use?
And that is why I didn’t include it as I dropped a few coins in the guy’s cup as he opened the door to the Citibank ATMs for me. I had an address and a place to shower and clothes that could be worn to an interview and a college degree and two years of work experience that he didn’t have. At the time, I wasn’t using those assets to earn money so I guess it was an OK short cut. Mostly I expect it was a manifestation of feeling sorry for myself.
And it was also a recognition that it only took one year to set you on a mandatory path for a long, long time. I couldn’t see getting myself out debt on my old salary once I’d done a single year. At that point, I had to finish the degree and work in the field long enough to pay back the loans. And at my school there wasn’t really any question that I would be able to pull it off. There were (and are) schools where that is a very hard question.
Yes Ben, misallocation would have been a better word to describe the higher ed situation. At the root of that misallocation, however, are expectations of a ROI that is increasingly expressed in terms of a salary. (something which both schools, society, and even students are each responsible for)
This tendency to want to assign a monetary value to an education does lead to some behavior resembling what we’ve seen in housing. Ex: “buy the biggest house you can afford” vs. “don’t worry about the tuition, you’ll make it all back and more”.
‘bubbles tend to happen when supply is more slow to adjust than demand’
I could go on the internet for a definition I suppose, but it can be reasoned out just as easily. First, a craze is not a bubble. I don’t consider the cabbage patch doll thing to be a mania, even though some charateristics are similar, such as a profit motive, greater-fool based speculation, irrational behaviour, etc. What has been called a bubble in the past had much wider participation, more money involved and were lengthy events that at some point show parabolic increases. This is important, because the mentality has to reach a manic level, like we saw with tech stocks a while back. IMO, these events are rare.
For example, people often talk about a credit bubble. I don’t think that’s accurate as it doesn’t look like the historic episodes. Sure, on a graph it shows explosive growth, but the nature of the transactions and intent of the participants isn’t the same.
“a craze is not a bubble” Right, hula-hoops, slinky’s, mini-skirts, we can think of a lot of trends that didn’t lead to financial meltdown.
I think Edge has a point though where ROI is concerned. We’ve all been told that between to otherwise equal job candidates that the one w/ the degree will ‘always’ get the job! “don’t worry about the tuition”
Then again when Ben says; “and intent of the participants” that covers a lot of ground too! If schools sacked up and threw slackers off campus before the end of fresh. year, the ppl that really weren’t serious about -being- there to begin with.., there’d be plenty of seats in the lecture hall.
Yeah, conflating these differing issues into a catchall term like bubble was not helpful on my part. Especially since it partially masks the extent to which the increased demand for higher education was part of many individuals’ personal responses to soaring housing costs (and other factors too).
Too bad we can’t have a parallel world to observe, one with house prices at the historical mean. I wonder how the demand for, and cost of, higher ed would be in that world as compared to ours?
‘in that world as compared to ours’
Two things come to mind; Japan had a stock, then RE bubble, same as the US. Was it one mania spilling over into another? If nothing else, the Fed and regulators should have took notice, especially considering Greenspan’s ‘irrational exuberance’ comments. (That was 96 or 97, IIRC).
And if stocks were potentially in mania mode around then, think about how long these twin bubbles ran. (What bugs me the most about our policies today, is the refusal to accept that these bubbles created huge distortions in the economy. IMO, one of the reasons this recession is so bad is the failure to address this basic fact.)
I’ve often thought about what immigration policy, for example, may have been like without all this money floating around. Or globalism and trade accords; just about every major part of the economy would have likely been different.
One could argue that “serial bubbles” is a sign that there’s more money floating around than the financial industry can find good investments for. We’ve given the rich and the Chinese a bunch of money and they “invest” it rather than spending it. But it’s ended up circling around Wall street, pumping up a series of bubbles, being destroyed when they pop, and enriching the brokers at every turn.
‘more money floating around than the financial industry can find good investments for’
Don’t forget the carry trade, which invites the same sort of thing.
I just see so many young ppl that are unwilling to even invest in themselves as they’ve convinced themselves there won’t be a world to inherit?
Ohhh boy. Post that comment over on the law school scam blogs and you’ll get an earful. They’re convinced that young ppl have OVER-invested in themselves and will never get out of hock.
I have two college age daughters. Their view is: why invest 4 years and $50-100K into getting a degree, when pretty much ever kind of job requiring a degree seems to be hopping a fast freight to Shanghai or Mumbai.
X-GS,
Not long ago I would’ve agreed altogether too quickly on that. I guess when you look at all the parents from India and China that have packed their kids off to study/work here, they’d probably complain about all the ‘mobility’ and resilience ‘their’ kids have had to show?
We’ve talked about this before a few times and there’s a consensus that assuming our kids will be able to study and work here without any ‘thought’ of having to work or travel abroad is a little dated.
Reminds me of the final scene from “A Summer Place”?
My daughters have zero interest in going overseas for any reason, much less for a job.
For better or worse, they are not afraid of telling members of the male gender when they are acting like morons. Including me.
I’m sure that will go down great in male-centric cultures like China, India, the Middle East, and Evangelical/Southern Baptist.
Urban China is not really any more male-centric than the United States. Most Chinese women work full-time in the cities and control the household finances.
Take a look at American grad schools, you’ll see plenty of female Chinese students there. Many of them return home and do big things.
The stay-at-home-mom mentality is actually a lot stronger here in the US, especially among the well-off.
Let me get you into this no-downpayment, Fannie-Mae owned home!
What did the realtor say to the homeless street beggar?
“They’re not making any more cardboard”
I’m taking a teeny two-day vacation and spent a few hours in front of HGTV. One young and not-too-bright Chinese couple looked at 30 houses in Toronto and decided NOT to buy a house, and instead decided to save a up a little more before looking again.
(show date 2009) To be fair, there was no way they could have bought a house big enough for them + Mom + brother and satisfied Feng Sui on their own $440K budget.
But that doesn’t mean HGTV is changing to more sensisble shows. On House Hunters, a young Peruvian man who runs his own business “staging houses” spent $450K on a 1-bed condo in Seattle. Two sisters spent $450K on a two-bed condo in Tel Aviv, Israel. A middle aged couple spent $23K on a standard bathroom (but it was a total demolition). An English couple spent $450K on a vacation home in the Dominican Republic. It was pretty vomit-inducing to watch the family be nitpick over high ceilings and whether or not you had to go down two steps to get to the pool. Yeesh, you’re only going to be there a month out of the year…
The best example was the young couple with two young kids who spent $120K or so in Italy. They could have gotten a much nicer actual house but on average land. They instead chose the one-room cottage on three gorgeous hillside acres dotted with olive trees and an incredible view of the lake. They’ll eventually build a larger house, but for now they live just fine sharing one room + one bath + kitchen for the few weeks out of the year. The kids will spend will most of the time outside anyway, they figured.
We need a LOT more of this attitude.
Good to see that there are still plenty of people flush enough to by vaca homes in Europe…..
Who says no one has any money anymore!!!
Why I love this blog: A blast from the past in the form of a memorable quote from a FB:
“It was my equity I cashed out. I see no reason why I should have to give it back.”
While we are blasting from the past, here is a little piece of brilliance from bluprint 10/29/08.
“Anyway, if I had any say in it, I would still make it a black guy for prez. I think we could use the culture and maybe it would generate some benefits with regard to foreign relations. “
Maybe the Bilderberg Group follows this blog?
We underestimated its effect on the know-nothings here at home.
2005
Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors says that “South Florida is working off of a totally new economic model than any of us have ever experienced in the past.” He predicts that a limited supply of land coupled with demand from baby boomers and foreigners will prolong the boom indefinitely.
“Snaith specializes in economic forecasting. He’s a member of advisory panels with the Federal Reserve Bank of Philadelphia and USA Today. A critic of the “housing bubble” school, Snaith prefers the term “housing souffle.” Real ingredients, not just speculation, fed Florida’s boom. But now the souffle has partly deflated.”
Ahh, the good ol’ days
My favorite stroll down memory lane is from a spring issue of Washingtonian Magazine. Great article about how it all peaked and it all came down. It’s a good read to hear how times were great back then, and how agents never saw it stopping, nor do they recognize its a different world, even here in the DC Metro area:
http://www.washingtonian.com/articles/homegarden/15489.html
Quicken home loan commercial:
Home loan experts who will always be there for you…
do you think?
http://www.youtube.com/watch?v=TkQDso92RgM&feature=pyv&ad=5447475279&kw=mortgage&gclid=CMjG9vbqzaQCFYlY2god8whrEg
No One, can do what Countrywide can:
http://www.youtube.com/watch?v=Ei5OrV-CmHg&feature=related
The education bubble hits the UK:
Student tuition fees: Browne review urges no limits
Universities in England should be able to charge unlimited fees, a major review of university funding has recommended.
Lord Browne’s review calls for the £3,290 cap on fees, which students borrow in loans, to be scrapped.
Instead it proposes a free market in fees - setting out models of charges up to £12,000 a year for a degree course.
http://www.bbc.co.uk/news/education-11519642
Still looking for a suitable investing strategy in these troubled times? Here is some cheap advice for you (available from under $4!):
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What, I gotta read it? Can you summarize it for us uber-lazy? Is it different from the Permanent Portfolio?
“Can you summarize it for us uber-lazy?”
If you want to follow the lazy portfolio strategy, you are going to have to make the effort to order yourself a copy of the book and read it. Seems paradoxical, but this is the truth.
No need to buy a book, just watch CNBC and let them tell you what to buy. It’s free and it’s pretty darn lazy too!
Can you summarize it for us uber-lazy?
Sure. “Bring in more money than you spend. A lot more.”
“Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery.”
Charles Dickens, David Copperfield, 1849
One of my favorite quotes of all time, PB!
Hey I didn’t realize that MERS has a “MERS Commercial” part that performs their magic on commercial real estate.
Vienna, VA—MERS announces the release of its latest product, MERS® Commercial, designed to eliminate the repurchase risk and costs associated with preparing, recording and tracking assignments for the commercial mortgage-backed securities (CMBS) marketplace.
Commercial originators and issuers can save hundreds of dollars in preparing and recording assignments; in cases of cross-collateralized loans, the savings can be in the thousands. Missing interim assignments are eliminated, making the lien release process more efficient for commercial servicers. MERS® Commercial also allows special servicers to foreclose more efficiently by eliminating the problem of missing interim assignments…
MERS® Commercial has been jointly funded by Banc of America Securities, Bear Stearns, GE Capital Real Estate, GMAC Commercial, John Hancock and Wells Fargo.
Linkey
http://www.mersinc.org/newsroom/press_details.aspx?id=157
http://www.mbaa.org/files/present/2001/mers_0204.pdf
So long as Wall Street is swimming in record pay, I fail to see the problem.
David Weidner’s Writing on the Wall
Oct. 12, 2010, 12:00 a.m. EDT
Banks blink on their own fine print
Commentary: Industry’s press for quick foreclosures backfires
Pay on Wall Street knows no boundaries
By David Weidner, MarketWatch
NEW YORK (MarketWatch) — There’s a joke I like to make to rookies before we go live on our News Hub shows.
After the new participant counts to 10 for an audio check, I usually say, “You have passed the exam to become a mortgage banker.”
It turns out that’s closer to the truth than most of us ever realized.
Judging by the failure of big banks to get their foreclosures in order, someone who can count to 10 might be overqualified.
…
Eddie, are you out there, pal? Mr Market is headed south, and October isn’t even half over yet. I’m wondering if 2 1/2 months are enough time for a final run at that DJIA = 12K mark you have been touting here for many months? Thanks for keeping us informed.
Sincerely,
A Deeply Concerned Bear
Is Eddie a trader? We might get Dow 12,000 on the way to Dow 6,000.
For someone like me, an S&P 500 dividend yield of 2.0% and the tendency of executives to wipe out any capital gains by issuing stock to each other means bad things for the long run.
And my savings or even for the kids’ college, which will need to be spent in the next five years (no risk allowed), or retirement which will not be spent for 20 years (short term increases irrelavent).
If you are trading, you’d better be on the right side every time in perpetuity. Lots of people made money flipping houses — then lost it all when long term reality set in.
“Is Eddie a trader?”
You have the correct letters, just improperly arranged.
Eddie is a retard.
Is Eddie a trader
You misspelled it.
Pot meet kettle.
nick, eddie, etc etc.
Why hide?
Darn it Excreter, you found me out. You’re such a good detective!!
lmao…. nicely done pressboardbox!
MarketWatch Morning Stock Talk
Oct. 12, 2010, 11:36 a.m. EDT
Hobart: Next stop, Dow 10,000
Market is unrealistically giddy about the Fed
Dow 10,000 is more realistic than 12,000, says Chris Hobart, president of the Hobart Financial Group. “I’d love to be an optimist and say the U.S. economy is healthy and strong,” says Hobart, “but there’s too many things telling me we’re not healthy enough to burst out to 12,000.” Hobart thinks the next step depends on the 3rd quarter earnings beginning to roll in now. “If they’re not substantially stronger than anticipated, I have a feeling that’s going to begin that potential for crumbling,” Hobart says.
QE2 buy on the rumor sell on the news ?
I have no idea’s better than that right now
Idaho’s Canyon county, the county to the west of Boise’s Ada county, is recording the lowest median house prices since the year 2000.
Canyon County’s median home price in September dropped to a 10-year low of about $82,000, slightly more than half of Ada County’s median home price, according to Intermountain Multiple Listing Service numbers released Monday.
There’s a half-price sale under way for homes in Canyon County.
The question is whether it will it end before discounts get even bigger….
Linkey
http://www.idahostatesman.com/2010/10/12/1375981/canyon-countyhome-pricesat-10.html
With the Repubs thinking they are going to win both houses and the Dems desperate to stay in power, what are your guesses as to the crazy promises of goodies for the sheeple over the next few weeks?
The big one that I can see is the foreclosure moratoriums (technically done by a few major banks, but not without a lot of states’ attorney generals closing in). Of course they would have done that over the holiday season anyway (at least a lot of banks did that the past two years), but Christmas came a little early this year, seeing as how its an election year and all.
Well, it’s too late to get stim checks out.
Maybe they will promise to automagically refi every mortgage to the current low market rate, regardless of credit ratings or LTV values.
I honestly believe you just stated the next step in the seemingly irrevesible chain of events which can only result from rewarding bad behavior.
We have to keep these poor victims in their homes.
“Never fear, kids. FannieMan is here!” (fat guy in mask and cape who looks like Barney Frank in tights flys in on cue).
LOL. Barney as “FannieMan”, no pun intended I’m sure.
Gross, but yes, funny
Ahhhhhhh!….I just pictured him (Barney as FannieMan) in trap door underwear and a cape!
At keast it would reward those who have kept up their payments but who can’t refi because of falling values or any other deason. At a lower interest rate they will amortize quicker too.
The FB’s? Well for them its just a band aid that defers the day of reckoning.
My guess is they will take the house only. Democrats will retain the senate although by a very small margin. Nothing will change. The republican house may pass one or two bills to cut spending just to appease the Tea-partiers with full knowledge that Obama will veto them. At the end of the day the republicans will come around and work with the President in passing bad bills as usual.
+1 butters.
Polly, if you are reading….I should have been more explicit in my posts two days ago. I was not searching for legal advice pertinent to our specific case on the web. Hey, my wife’s home she has stopped paying on, and we shall move whenever ownership changes hands and we are evicted. We are OK with this outcome, we deserve it. Until then we will live there (on advice from the longtime city attorney here), the home had its loan granted on the stipulation that the property be owner occupied, it is best for her, the owner for now, to live there until she loses the property. That way it does not look like an investment, rather a place to live. Luckily, she did not acquire a liar loan, so there are no income lies perpetrated by her on the loan app.
What I was getting at is that for the layman the terminology can be utterly confusing. And now us FBs are taking a more active interest in understanding it. Title, note, deed of trust, loan owner, loan servicer are terms I rarely thought about back in 2007. All I knew was that RE was making us tons of money. Now we wanna know about not only the terms, but all the changes of ownership(and of what parts of the whole loan package these changes applied) over the term. Not to mention trying to grasp securitization, CDSs, etc. Reading here has helped but I still don’t get it all, and I have always been someone who likes to grasp a subject once it takes my interest.
When Bofa bought Countrywide, I am assuming now that means they bought the servicing rights to the loan, which had been sold to Fannie Mae sometime at or shortly after origination. And the MSM has not been illuminating regarding these nuances or explaining the terms formerly mostly only really understood by brokers, bankers, and maybe realtors(ok probably not realtors)
So I was looking for clarification of what happens over the life of a loan and its anatomy in Schoolhouse Rock format (just a bill, sitting on Capital Hill). In a general sense, I guess. And thank you for your forthright honesty and the good lawyerly writing you add to this blog.
“When Bofa bought Countrywide…”
I get the feeling the Treasury more shoved Countrywide down BofA’s throat. Buying Countrywide at the time would be more like buying an expensive dinner after it has already been digested fully. A steaming turd is nothing to pay up for.
You are welcome.
But I still think you were mushing together two different issues over the weekend. You were asking about the servicing agreement. The current “crisis” is about ownership of the mortgage. In a contract as complex as a servicing contract, there will always be some provision set up for what happens if there is some issue with the servicer. In the case where it is bought out, there is no reason to think that the contract won’t provide for the purchaser to take over that role. After all, the right to do that work in exchange for money is an asset of the company.
The problem we are dealing with now is whether the servicer has a contract with the owner of the note or not. Now, I think you understand that, but you were asking a few questions over the weekend that implied that you didn’t.
Unfortunately, no speakee legalese. I still don’t understand the complex relationships that exist or don’t? between servicer and note holder. Does the average Joe know what is really going on if like me he does not understand the terms. Certainly he is not being helped by the superficial MSM.
But I assume Bofa’s moratorium includes loans that were made by Countrywide that they service, but did not originate and therefore do not explicitly hold the note in house.
We’ll see for sure if Recontrust carries out our foreclosure as scheduled in November, and title reverts back to the beneficiary. Until then we will let the wolves stay on the porch, with nothing to feed them they will definitely get in the door at some point!
Have not seen this mentioned anywhere, but it seems that the title of any mortgaged property where the mortgage was resold and robo-signed, would have a cloud on the title, whether the property was under foreclosure or not. A mortgage current on payments could well have title issues if the owner wanted to sell.
Another thing… title insurance policies have so many exclusions that it is no surprise title cos. payout ratios are less than 5%.
“title insurance policies have so many exclusions”
Typical insurance shakedown scam. A worthless product you have to pay for that provides no protection.
A friend of mine who bought an apartment house found out 10 months later that there were $2600 in unpaid utility bills that didn’t show up on the title report. The title company admitted responsibility and paid for it. He went through the real estate broker, so maybe the title company was afraid to lose the broker’s business.
Out of curiosity, did the utility companies have leins on the property? I know title companies will check the recorder of deeds records, but are they supposed to check with the utility companies as well, even if there is no lein at the time of sale? Are utility bills secured debt or unsecured debt? If it is unsecured, why would your friend and/or the title company be responsible? Shouldn’t the utility company track down the previous owner and get in line with all the unsecured creditors? Did your friend not change the utilities to their name immediately upon purchasing the property? If so, why wasn’t it disclosed then instead of ten months later?
We’re eyeing a piece of short sale property with a vacant teardown on it. It has been disclosed that there are unpaid utility bills, but the amounts were not disclosed. We’re not terribly serious about the property, but if we change our minds we’re aware we need to look out for this issue.
You buy title insurance so an independent party can examine the title and make a determination that it is clear. The insurance party of it is just a guaranty that they did a good job (or not). Title companies pay few claims but their expense is on the staffing and resources to check the titles to make sure they get it right.
You can’t compare a loss ratio to a homeowners insurer or auto insurer.
Realtors are corrupt.
Come on, Ex, not all of them. Some people like to sell things, what’s wrong with this?
I understand it will never happen, but I’d love for you to meet my realtor. He truly understands that it is a box, and not an HGTV version of “home.”
He’s unusual. Most realtors are completely brainwashed and know only what they are told at their weekly broker pep talks. They receive email blasts from their local association and the NAR which provide their weekly talking points. A real professional would read the literature relevant to their field so they could give good advice to their clients.
Some of the older ones are cool. The ones about to get out of the biz and don’t need to BS you the way the young ones do.
They lie and steal, too!
True pressboard. Therefore realtors are lying, corrupt thieves.
What kind of perverse pleasure do you people get out of bashing realtors? How much longer can you keep saying the same thing over and over, it’s getting boring. There are a lot of good realtors around, but you seem to want to let a few bad ones ruin it for everyone.
Oh, put a peach in it!
That’s about all I expected from you.
Hilarious Pbox…
My inbred family loves realtors.
Good… so you two confederate inbreds get a room with your realtor friends.
I’m sure it would be a lot more interesting than hanging aound you. Talk about boredom!
Talking about living in your head rent free.
Georgiaboy / Georgiagirl
You all get together and create a new twit ginwrench.
Everyone is corrupt in Excreter’s world. Everyone except union thugs right Excry?
Hello Trader/Retard. lmao.
The gross wealth inequality in America is a major cause of our decline. However, most Americans are unaware of, and naturally opposed to its extent.
Study: Most Americans want wealth distribution similar to Sweden
92 percent prefer Swedish model to US model when given a choice
http://www.rawstory.com/rs/2010/09/poll-wealth-distribution-similar-sweden/
Americans generally underestimate the degree of income inequality in the United States, and if given a choice, would distribute wealth in a similar way to the social democracies of Scandinavia, a new study finds.
The authors suggest the reason that American voters have not made more of an issue of the growing income gap is that they may simply not be aware of it.
For decades, polls have shown that a plurality of Americans — around 40 percent — consider themselves conservative, while only around 20 percent self-identify as liberals. But a new study from two noted economists casts doubt on what values lie beneath those political labels.
According to research (PDF) carried out by Michael I. Norton of Harvard Business School and Dan Ariely of Duke University, and flagged by Paul Kedrosky at the Infectious Greed blog, 92 percent of Americans would choose to live in a society with far less income disparity than the US, choosing Sweden’s model over that of the US.
What’s more, the study’s authors say that this applies to people of all income levels and all political leanings: The poor and the rich, Democrats and Republicans are all equally likely to choose the Swedish model.
But in their study, the authors found Americans generally underestimate the income disparity. When asked to estimate, respondents on average estimated that the top 20 percent have 59 percent of the wealth (as opposed to the real number, 84 percent). And when asked to choose how much the top 20 percent should have, on average respondents said 32 percent — a number similar to the wealth distribution seen in Sweden.
“What is most striking” about the results, argue the authors, is that they show “more consensus than disagreement among … different demographic groups. All groups – even the wealthiest respondents – desired a more equal distribution of wealth than what they estimated the current United States level to be, while all groups also desired some inequality – even the poorest respondents.”
“…even the wealthiest respondents – desired a more equal distribution of wealth than what they estimated the current United States level to be”
Yes, there is clear evidence that this wealthy gang is currently organizing as a group to promote the financing of sports stadiums without using any public taxpayer money. They also are graciously dumping good seat tickets on StubHub starting at less than $10.00.
The appropriate headline would be “92 percent of Americans do not know what “Sweden” is.”
Its where meatballs come from, silly!
And flat packed particle board furniture.
And blonds.
ABBA
The appropriate headline would be “92 percent of Americans do not know what “Sweden” is.”
Wrong:
The appropriate headline would be “92 percent of Americans do not know what “America” has become.
So true, the masses still believe that we are in a cyclical recession and that all it will take are a few good policy choices and once that’s done we’ll all be taking delivery of our new Escalades.
This series of maps will help Americans understand how Europeans see one another.
http://bigthink.com/ideas/24357
Europe as seen by the Americans:
Russia =
CommiesFuture brides for American retired men with pensions & SS incomeI think you mean the Philippines - the scenery is much better
Thanks, those made me bust a gut.
Working with a Bulgarian fella, it was no surprise to me why they (the Bulgarians) labeled Poland as “sexy fembot” land. What a hoot!
Good find DennisN!
LM(considerable)AO!
Thank you Dennis. This is just wonderful.
The “Strange Maps” website is worth checking a couple of times a month.
+1
I love your “studies”. Studies and statistics from far, far left organizations and blogs.
Here is the reality of people’s view on government:
By Susan Page, USA TODAY
WASHINGTON — Americans are having a crisis of confidence in their government.
A majority in a new USA TODAY/Gallup Poll disapprove of the jobs President Obama and Congress are doing and have unfavorable views of both major political parties. Only half express even a fair amount of trust and confidence in the people who hold or are running for public office. Just one in four are satisfied with the way the nation is being governed.
Meanwhile, six in 10 Americans say the government has too much power, and nearly half agree with this alarming statement: “The federal government poses an immediate threat to the rights and freedom of ordinary citizens.”
I love your “studies”. Studies and statistics from far, far left organizations and blogs. eddie
My god sir, have you no self-respect? yawn
Studies from “far left blogs”? Who does the studies eddie, the blog sites OR the Universities that you tout so highly.
The study was NOT done by the blog sites. The study that showed: Most Americans want wealth distribution similar to Sweden…92 percent prefer Swedish model to US model when given a choice
was done by HARVARD and DUKE, The same universities that you said were THE ONLY TYPES OF UNIVERSITIES WORTH GOING TO. You’re funny and easy. (although boring)
So you see, these studies were not done by liberal sites, they were done by the schools YOU’VE ADMIRED REPEATEDLY IN YOUR POSTS. Your duplicity in the service of an obvious bias is expected but duly noted. Sorry.
Although a threat for sure, I believe the greatest threat to America is not the deficits but rather the destruction of the middle-class job base, wealth inequality and politics being taken over by the financial elites. The following suggests the interrelationship of those factors.
http://www.kitco.com/ind/nadler/oct122010.html
While in no way painting a deep-pink or rosy picture of the current or future state of affairs in the US economy for his audience, Mr. Galbraith did lay to rest a few of the scarier skeletons being trotted out by the less-than-savvy newsletter marketing machines and freshly-minted “financial advisors” these days. Namely, said Mr. Galbraith, “please understand that:”
1. Overwhelmingly, the present deficits are caused by the financial crisis. The financial crisis, the fall in asset (especially housing) values, and withdrawal of bank lending to business and households has meant a sharp decline in economic activity, and therefore a sharp decrease in tax revenues and an increase in automatic payments for unemployment insurance and the like.
2. According to a recent IMF staff analysis, fully half of the large increase in budget deficits in major economies around the world is due to collapsing tax revenues, and a further large share to low (often negative) growth in relation to interest payments on existing debt. Less than ten percent is due to increased discretionary public expenditure, as in: stimulus packages. This point is important because it shows that the claim that deficits have resulted from “overspending” is false, both in the United States and abroad.
Mr. Galbraith went on to observe that “The [real] financial tragedy facing the American middle class is therefore the destruction of the notion that houses embody net wealth.” He also notes that in recent years we have been subjected to a rising cacophony of nonsense about a looming financial crisis; i.e., we are told, future unfunded entitlements will bankrupt our government as the baby boomers retire.
Not so fast. As Mr. Galbraith noted, “There is nothing alarming about this. Just as the public debt can be eternal, and need never be paid off, a net debt position for Social Security and Medicare can likewise be eternal as well, since the government’s net deficit is balanced by the nongovernment sector’s net surplus. Spelling out the balance sheet in full for “the nation” would be good financial- reporting practice. And in this case, it would usefully reduce the scare-content of claims that focus on liabilities without acknowledging the corresponding assets.”
Pure fantasy. It will work until it doesn’t.
FWIW, SS is the best funded part of the government. It ran surpluses for decades until this year, and it’s deficits are tiny compared to the rest of the government,
This of course is why every effort will be made to kill it and redirect the payroll tax to more “conservative” issues (such as fighting wars of occupation).
Being a soldier has become the new “factory job” in the US which now absorbs the blue collars class’s cream of the crop. The pay is good and if you can manage to remain alive and competent you might make it to 20 years of service and retire with a taxpayer funded pension.
Funny how “conservatives” never fret about how unsustainable the military spending is. They just keep signing the carte blanches and in an Alfred Neuman sort of way simply shrug their shoulders when budget deficits are brought up.
I am not a conservative so I will let them speak for themseleves. Paleo are certainly against wars and nation building. It’s the neo-cons and mainstream republicans who never utter word about military spending. If it was up to me, I would lower by two-thirds.
Just saying that the Neo-Cons (who consider themselves the true incarnation of conservatism) will be screaming to dismantle SS after the election, with every pundit on Fox News along with Rush, Beck, Coulter, etc. giving their blessings.
SS is a pyramid scheme. Nothing more nothing less. Those who bought in first made out like bandits. Those who bought in last, ie people my age, are going to lose everything we put in.
Sane people understand this. Liberals and the insane don’t. But I repeat myself.
SS is a pyramid scheme. Nothing more nothing less. Those who bought in first made out like bandits. Those who bought in last, ie people my age, are going to lose everything we put in.
Sane people understand this.Greedy WallStreet immoral hacks who desire this money as a vampire does blood, perpetuate this fallacious and self-serving lie.I’m afraid Eddie is right this time. The only difference between SS and Madoff’s scheme is that no one had to “invest” with Madoff.
The only difference between SS and Madoff’s scheme is that no one had to “invest” with Madoff.
Right…..
The only difference …..
Being a soldier has become the new “factory job” ??
+1…I agree…Its the trade to go into if you are not tracking in College…Great trade…Learn how to kill…Then come home and become a cop…That is unless you are dead, maimed, or so mentally destroyed by the mayhem you witnessed that you are totally dysfunctional…
In the mean time, here back at home, we will keep the military industrial complex humming right along building things that you can wear out or blow up…
It will work until it doesn’t.
Maybe. But that’s better than not working until it does.
Less than ten percent is due to increased discretionary public expenditure, as in: stimulus packages. This point is important because it shows that the claim that deficits have resulted from “overspending” is false, both in the United States and abroad.
What? Our deficits aren’t being caused by out-of-control Keynesian spending? Someone better tell the Teapartiers. It’s almost like they’ve been misled by their ‘leaders’.
Some might argue that they were caused by the Bush tax cuts, which were never offset by cuts in spending.
running a war (well, two wars) “off book” is never a good idea
Overwhelmingly, the present deficits are caused by the financial crisis. The financial crisis…. has meant a sharp decline in economic activity, and therefore a sharp decrease in tax revenues and an increase in automatic payments for unemployment insurance and the like.
This is why ‘letting it all crash’ can actually be more expensive than stimulus spending.
This is why ‘letting it all crash’ can actually be more expensive than stimulus spending.
Yea but,
The man asks his lawyer, “Why is divorce so expensive?”
His lawyer grins and replies. “Because it’s worth it.”
This is a hoot.
The administration’s basic logic has not changed since it took office in the depths of the financial crisis: Hitting the financial industry, officials argue in private and in public, hurts the broader economy. A moratorium on foreclosures may provide short-term political satisfaction in an overheated election climate, but the administration fears it will only delay the inevitable and necessary process of forcing many Americans out of homes they cannot afford.
The White House can focus on the eventual economic benefits of foreclosures. But Senator Harry Reid, the Nevada Democrat battling to salvage re-election in the state with the nation’s highest foreclosure rate, cannot. The result is that Mr. Reid favors a moratorium, and the White House finds itself in an uncomfortable moment of agreement with his Republican opponents.its all about keeping power….vote all career politcos out!!!!!!!
.
More deflection from the fact that the moratorium was enacted because due process was not being followed and that there are real questions as to true ownership.
Like the oil companies whining about a temporary halt in drilling when in reality, is was so they could get their safety procedures in order, only to have 2 more rather large accidents anyway.
That not being allowed to main and kill and rob and steal (loot, pillage and plunder) at will is somehow anti-capitalist socialeest/communism, is beyond the absurd.
But the American weren’t so damn stupid in the first place, they wouldn’t get away with it.
That not being allowed to main and kill and rob and steal (loot, pillage and plunder) at will is somehow anti-capitalist socialeest/communism, is beyond the absurd.
This absurd and dangerous perception (actually new to popular American thinking) is due, as you know, to the incessant, self-serving, brainwashing lies of the past 30 years, emanating from the think-tanks and media mouthpieces of the far-right, nutball uber-rich.
whew..
THE ACREAGE, Fla. - Juan Guzman has a large, lawn-wide sign in his front yard labeled ‘JP Morgan Chase help.’ It’s his last hope to save his dream home.
The Acreage man built his house in 2007 but couldn’t handle the mortgage payment of $3,600 a month.
He said he tried negotiating a lower loan from his bank but it wouldn’t budge.
Last year Guzman became unemployed and now his house is in foreclosure.
Talking about his sign, Guzman said, “Trying to save my house, my family and my savings, life savings.”
Guzman said his sign on his 82nd Lane home can be seen from an airplane.
He hopes to negotiate with his bank again because he is now employed.
“We are all Americans and we should be helping each other. You banks, you already got the help from the government, so its time to show up,” Guzman said.
Guzman’s plea for help comes when some banks, including JP Morgan Chase, are temporarily stopping the foreclosure process.
Guzman says he’s putting up his sign for those who don’t want to speak out. “There’s a lot of people like me that are not putting signs like that out.”
Guzman’s neighbors have seen the sign in his front yard. And at least one living down the road is dealing with some home loan issues of his own.
Fernando Cujar’s home is almost finished. He says his bank won’t switch his home construction loan to a regular home loan.
He says he needs the switch to get a few more thousand dollars to finish the house.
“The banks, they don’t understand that. They don’t have the human part of the situation,” Cujar says.
Still, Cujar feels inspired by Guzman’s sign. “He’s been fighting so much. He’s a tough fighter, you know?” $$$ 3600 A MONTH MTGE HE SADDLED HIMSELF W/ THIS,AND HE WANTS HELP..AND MOST IMPORTANTLY ITS HIS DREAM HOUSE,THE BANKS MUST HELP HIM…
PRINT
I don’t know what the gentleman’s income was before he became unemployed, but $3600 is one heck of a monthly nut. However, this is the place where his logic really fell apart.
“We are all Americans and we should be helping each other.”
I have never understood why anyone whether he or she is a loan holder, a politician, reporter or any other person thought that they could convince the banks to do the nice thing. Banks don’t do that. They take any help they can get (assuming it doesn’t mean restricting executive comp too much or for too long) and they give nothing. That isn’t their job. Their job is to serve their shareholders. If helping their customers can serve their shareholders, they will. If not, they won’t. And you can probably count on them not helping customers even when it would help their shareholders because of imperfect information and reluctance to hire enough people to collect and process the information.
This guy’s annual mortgage is around the so called median income.
Cry me a river.
The state was able to get high bids because investors can borrow money at low rates.
Ho ho, hah hah, hehehehehehe, BwaHaHaAhHAHAHAHAHAHA!!! (Cantankerous Intellectual Bomb-thrower™)
California accepts $2.33-billion bid for 24 office buildings:
By Roger Vincent, Los Angeles Times / October 12, 2010
“It’s like selling your garage to your neighbor to pay your mortgage,” he said. “Given the choice between selling strategic assets and taxing gas guzzlers, I would have selected a different outcome.”
California officials accepted a winning bid Monday of $2.33 billion to sell 24 state office buildings to a consortium of three U.S. investment companies.
Here is a good editorial in the rapidly pro-business Crain’s New York Business.
http://mycrains.crainsnewyork.com/greg_david_on_new_york/2010/10/tishman-speyer-and-morality-in-real-estate.php
“This week, finally, the lenders are slated to foreclose on Stuyvesant Town/Peter Cooper Village, ending the saga of Tishman Speyer’s reckless purchase of the iconic housing complex. It’s an appropriate time to examine Tishman’s Speyer’s actions in terms of morality, or if you don’t like that word, substitute “ethics.” Or if that is still too pejorative, we could try “responsibility.”
“When Tishman couldn’t raise rents high enough and its reserve fund became exhausted, it tried to negotiate a deal with lenders to restructure the burdensome debt. Tishman walked away when that deal was not advantageous enough to Tishman. The key here is that Tishman had the resources to put more money into the deal, but it chose not to because there would be no payoff in the future.”
“This is exactly the same situation faced many Americans who are “under water” in their home loans…These homeowners are frequently lectured–especially by the banks that hold their mortgages–that they have a moral obligation to fulfill the commitments in their contracts.”
“The anger sweeping America about “Wall Street” is based on the belief that the game is rigged against the average American and that there is a double standard for the average consumer and the big guys in New York. Tishman Speyer proves that assumption is correct. And that isn’t good for Wall Street, the country or even the average consumer.”
My comment: in a course on commercial real estate finance, I learned about all the bizzare loan pertumations available to commercial real estate investors. I subsequently found out that many of the same types of loans were being made available to clueless American families.
In the same situation, American families have behaved exactly like serial bankrupt Donald Trump. The mistake was allowing this situation to occur.
American families have behaved exactly like serialist bankruptus Donald Trump
One other “radiant” difference:
Families are selling GOLD!, sTrump is polishing his Gold.
I still say this was all part of the plan
Tishman purchases Stuyvesant from Met Life for way more than it was worth putting little money into the deal. Blackrock sells the debt to GSE’s and Pension funds.
Tishman then sells a property downtown only to buy the Met Life building for a much lower price in terms of cost per sq foot.
Met Life remains tennant possibly paying above market rate rent.
Met Life get’s to sell Struyvesant town for way more than it’s worth.
Blackrock makes huge commission selling debt.
Tishman gets sweetheart deal on Met Life building.
GSE’s and thus tax payers plus Pension funds get bent over.
We have a winner!
California to Sell 24 Government Buildings for $2.3 Billion
The state announced Monday it is selling 24 government office buildings — including the Ronald Reagan State Building in Los Angeles and the San Francisco Civic Center — to a group of private investors for $2.3 billion.
Ron Diedrich, acting director of the California Department of General Services, announced it selected the offer from California First LLC, a partnership led by a Texas real estate firm and an Orange County private equity firm.
About $1 billion of the sale will be used to pay off bonds on the buildings, leaving more than $1.2 billion to go into the state’s general fund.
“After an extensive review of more than 300 bids that were received, I have determined that this offer presents the best value for the state,” Diedrich said in a statement.
“This sale will allow us to bring in desperately needed revenues and free the state from the ongoing costs and risks of owning real estate.” Gov.Arnold Schwarzenegger and lawmakers included the sale as part of the state budget last week.
and free the state from the ongoing costs and risks of owning real estate.”
Jack Buck:
“I DON’T BELIEVE WHAT I JUST
SAWREAD!”edit mine
So they;ll have a cool billion left over, that will cover about what, 2 weeks of budget gap?
This is like holding a garage sale to pay the mortgage.
And sleaking of garage sales, no ones buying. The wife asked me to get rid of a Casio keyboard we have that been collecting dust. I checked craigslist and underpriced every one else.
It hasn’t sold. Maybe the kid’s school will take it and I’ll settle for the tax write off.
No, this is like mortgaging a paid off house to pay the Credit Card bills. I wish the article had disclosed the rent per sq ft Cali will be paying to lease back the facilities. Just kick it a little farther down the road. It’ll be Meg or Moon Beam’s problem soon.
Arnold will ride off in to the sunset thinking, “I ain’t never doing that again, what was I thinking”.
“Arnold will ride off in to the sunset thinking, “I ain’t never doing that again, what was I thinking”.
You got that right!
Whichever of the one new & one old turd, running gets it, they will take the Barry approach… I/we inherited this mess. The drooling dupes that elect them will say, hell yea they are trying hard to help us! LOL!
Wash,rinse and repeat as we head down the crapper.
I’m trying to think of which buildings in the San Francisco Civic Center the state could own?
There’s a lot of City buildings.. (main library.. Opera house) and federal courts.. FBI headquarters down there?.. lots of federal stuff.
I guess the Superior court building is state owned..
“The San Francisco Civic Center was designated a National Historic Landmark in 1987.” wikipedia
Foreclosure Fraud: It’s Worse Than You Think ~ CNBC
There has been plenty of pontificating over the ramifications of foreclosure freezes on troubled borrowers, foreclosure buyers and the larger housing market, not to mention lawsuits, investor losses and bank write downs. There has been precious little talk of what the real legal issues are behind the robosigning scandal. Yes, you can’t/shouldn’t sign documents you never read, but that’s just the tip of the iceberg. The real issue is ownership of these loans and who has the right to foreclose. By the way, despite various comments from the Obama administration, foreclosures are governed by state law. There is no real federal jurisdiction.
A source of mine pointed me to a recent conference call Citigroup (NYSE: c) had with investors/clients. It featured Adam Levitin, a Georgetown University Law professor who specializes in, among many other financial regulatory issues, mortgage finance. Levitin says the documentation problems involved in the mortgage mess have the potential “to cloud title on not just foreclosed mortgages but on performing mortgages.”
The issues are securitization, modernization and a whole lot of cut corners. Real estate law requires real paper transfer of documents and titles, and a lot of the system went electronic without much regard to that persnickety rule. Mortgages and property titles are transferred several times in the process of a home purchase from originators to securitization sponsors to depositors to trusts. Trustees hold the note (which is the IOU on the mortgage), the mortgage (the security that says the house is collateral) and the assignment of the note and security instrument.
“Foreclosure Fraud: It’s Worse Than You Think ~ CNBC”
Buyer Fraud: It’s Worse Than You Think
That’s what I’m thinking. Like I had commented the other day, what are the chances that the banks when pushed hard enough will then say let’s look at fraud in the buyer documents, appraisals, refi applications, etc. Funny how we don’t see any stories at all anymore that allude to buyer responsibility - it’s all the banks’ & government’s fault now.
Because the buyer fraud is nothing when compared to the lending fraud.
Le them look closer at buyer fraud. How much “buyer” fraud was still perpetrated by the loan officers? Do you think they REALLY want that kind of scrutiny?
First the stimulus, now the hangover. ~ Washington Post
Last week’s dismal jobs figures tell us exactly what the President Obama’s stimulus did: It temporarily saved jobs in state and local government — thereby slowing our recovery.
Friday’s job scorecard for September — the last before Election Day — didn’t carry even a hint of an imminent boom. Unemployment stayed at 9.6 percent, with private companies adding 64,000 jobs.
And 64,000 jobs is nothing. The economy must create nearly five times that to keep up with population growth and replace 7.6 million jobs lost since 2007.
Worse, the new hires were down a third from August — and the positions were low-paying, in bars, restaurants and retail.
The report also told us that people who have jobs aren’t working much overtime. That means companies aren’t overwhelmed by unexpected business — and won’t need to do a lot of extra hiring for the holidays.
The big headlines went to the drop in government jobs. Local and state government lost 83,000 jobs — the biggest hit in modern history. Teachers lost the most, with school districts cutting nearly 58,000 after summer break.
That’s terrible for laid-off workers. Life would be better if nobody had to lose a job. And, of course, Washington should provide unemployment benefits, as it does. But government still has to adjust to a new reality, just like every other part of the economy.
didn’t carry even a hint of an imminent boom.
What? No job openings yet for those soon to be built new golf courses in Hilton Head?
WMBZ
Tell us why stimulus spending actually made things worse. How did it slow our recovery up to this point??
If you haven’t been able to figure that out yet, I can’t imagine what I could write that would or could help you to understand just what the ’stimulus’ spending did and did not do.
This is not a new subject, the aftermath is going to be interesting. Especially since so many are expecting more stimulus spending, to keep this non-recovery going.
Tell us why stimulus spending actually made things worse.
It diverted people’s time and energy away from productive pursuits, towards the pursuit of government handouts.
Kind of like divers feeding fish on a reef instead of letting them find their own food. Throwing things out of balance.
Good analogy, at several levels.
Not only is it bad for the fish in that they become dependent on the diver’s food, but it also makes it a lot easier for the diver to control the fish. Want some food? Do a flip for me. Want some more food? Come to my fish tank and you’ll get some. Want some more food? Put on a show for my paying audience and you’ll get some.
Here’s another good analogy: mankind has harvested greater benefits from farming, than hunting in the wild.
Yes, that’s a good one too.
Of course in these analogies you do realize that the government is the diver/farmer/hunter, and mankind is the fish/wheat/game - right?
Not sure I like being farmed, to be honest. I’d rather be wild game and make the government hunt for me.
(Though actually the farmer in this analogy is the Megabankers; and the government is the 20-ton 400-acre-an-hour harverster. All the wheat sees though is the big machine, not the driver in the box.)
Tell us why stimulus spending actually made things worse.
It diverted people’s time and energy away from productive pursuits, towards the pursuit of government handouts.
No one knows. It’s probably a wash. Your sentence could be rewritten:
It bought people much needed time to regroup in order to pursue productive activities. (Like maybe jobs that are not there)
As far as other productive endeavours, I’d say less than 10% of Americans are cut out to own their own business.
Without another bubble, the unemployment rate is never going to be anywhere close to what it was pre-crisis. We’ve either off shored or technologically displaced way way too many jobs. For a while we could cover that up with the credit bubble (apologies to Ben) the tech bubble and the building bubble, but those are gone. Waiting for the unemployment rate to go to 5% is like waiting for a pot to boil on a stove that only gets to 195 degrees, its just not going to happen. The govt will work diligently to hide that fact in the way it gathers and reports UE statistics, but we all know the published number is hogwash. (Lies, damn lies and statistics)
Sure, the number may start going down a bit as people “give up” looking for a job. All that means is that their UE comp has run out so they have fallen off of the chart, not that they have gone back to work.
At some point, when the real UE rate reaches serious double digits and it is realized that it is not going to get better, the social order will begin to break down, much like it did in LA in the 70’s as young men (white, black and otherwise) realize that they have very little chance to better themselves.
Its not going to be pretty. I’m dang glad I am at the tail end of my life as opposed to the beginning.
“Besides that Mrs. Lincoln, did you enjoy the play?”
“It temporarily saved jobs in state and local government — thereby slowing our recovery.”
Doublespeak. How does it work?
Homeowner makes sign in foreclosure fight
It’s his last hope to save his dream home
THE ACREAGE, Fla. - Juan Guzman has a large, lawn-wide sign in his front yard labeled ‘JP Morgan Chase help.’ It’s his last hope to save his dream home.
The Acreage man built his house in 2007 but couldn’t handle the mortgage payment of $3,600 a month.
He said he tried negotiating a lower loan from his bank but it wouldn’t budge.
Last year Guzman became unemployed and now his house is in foreclosure.
Talking about his sign, Guzman said, “Trying to save my house, my family and my savings, life savings.”
Guzman said his sign on his 82nd Lane home can be seen from an airplane.
He hopes to negotiate with his bank again because he is now employed.
“We are all Americans and we should be helping each other. You banks, you already got the help from the government, so its time to show up,” Guzman said.
Guzman’s plea for help comes when some banks, including JP Morgan Chase, are temporarily stopping the foreclosure process.
Guzman says he’s putting up his sign for those who don’t want to speak out. “There’s a lot of people like me that are not putting signs like that out.”
Guzman’s neighbors have seen the sign in his front yard. And at least one living down the road is dealing with some home loan issues of his own.
Fernando Cujar’s home is almost finished. He says his bank won’t switch his home construction loan to a regular home loan.
He says he needs the switch to get a few more thousand dollars to finish the house.
“The banks, they don’t understand that. They don’t have the human part of the situation,” Cujar says.
Still, Cujar feels inspired by Guzman’s sign. “He’s been fighting so much. He’s a tough fighter, you know?”
Anytime anyone talks about their “dream home” you know there is going to be a sad ending.
I live in my Dream Home, its paid for, and has been for 10+ years.
Dream home in Spokompton? Surely you jest.
Dream home in Spokompton?
I’m saving up for Atlanta.
“The banks, they don’t understand that. They don’t have the human part of the situation,” Cujar says.
Ummm, oh…nevermind.
Quite the pad Juan built, he payed $212,900 for the GD lot in Jul-2005 then proceeded to build a 4226 Sq. Ft. house that includes a 722 Sq. Ft. garage. Juan must have some toys.
“Trying to save my house, my family and my savings, life savings.” “We are all Americans and we should be helping each other.”
O.K. Juan I am an American and here is some help. Lose the house you never could afford, rent something you can afford and try to keep your family and what is left of your life savings.
Name: GUZMAN JUAN M
Mailing Address: 13174 82ND LN N
Jul-2005 19077/1822 $212,900
WARRANTY DEED GUZMAN JUAN M
Tax Year:
Total Tax:
2010 $5,723
2009 $6,925
2008 $7,609
Year Built 2007
Subarea and Sq. Footage for Building 1
No. Code Description Sq. Footage
1. BAS BASE AREA 3001
2. FOP FINISHED OPEN PORCH 503
3. FGR FINISHED GARAGE 722
Total Square Footage : 4226
Total Area Under Air : 3001
I was looking at the delinquent property tax list for Missoula Co yesterday and found practically every recent urban condo project, as well as the johnny-come-lately subdivisions. I wouldn’t be surprised if many of the lots revert back to the county but I wonder about the condos??
In the early 1980s the city had to take over whole developments while the builders absconded. That was pre-condo…
Telling a bunch of loan sharks, “FB’s are friends, not food,” is not going to stop the foreclosure feeding frenzy, especially with so much blood already chumming the water.
Despite foreclosure halt, mortgage crisis not over
By CURT ANDERSON (AP) – 1 hour ago
MIAMI — For most Americans at risk of losing their homes, the brutal business of foreclosure goes on.
Bank of America halted foreclosures across the country to address paperwork problems, but three other banks did so only in 23 states. Other banks holding millions of mortgages have not suspended any foreclosures.
In the other 27 states, judges don’t have to review foreclosures. A homeowner must sue the bank for that to happen. Paperwork mistakes and fraud are even harder to discover, legal experts say.
Those states without judicial oversight for foreclosures include eight of the top 10 foreclosure states in America, including California, Arizona and Nevada. As with all real estate matters, location is everything.
“My gut tells me there’s a greater likelihood of fraud in these cases,” said Ray Brescia, a professor at Albany Law School in New York who has closely studied the U.S. mortgage crisis.
Not only have the mortgage industry’s actions been limited geographically, but banks mean different things when they say they’re halting foreclosures.
Ally Financial’s GMAC Mortgage unit, for example, is continuing to initiate foreclosures nationwide. It has stopped evicting homeowners and selling foreclosed properties in the 23 states that require judges’ approval.
By contrast, Bank of America has stopped seizing foreclosed homes in all 50 states — but is continuing to sell homes that had already been foreclosed on and is still processing new foreclosures.
Outside of the major banks, and even in states that do require a judge to look over the bank’s shoulder, foreclosures are going forward at a head-spinning pace. So the nation’s mortgage crisis goes on.
In Tampa, Fla., last week, a county circuit judge dispensed with dozens of cases on a single day. Eleven foreclosures went through in one 18-minute period. Most people never show up, and few hire lawyers.
“I’m really sorry that you are in this situation, but I can’t order the bank to modify your mortgage,” Judge Sandra Taylor told one young couple who owed $222,000 on a home and stopped making payments two years ago. “I wish you the best. You’re in a really large boat with a lot of other people.”
…
“You’re in a really large boat with a lot of other people.”
nah.. 31.8 % survived on “that” big boat.
This one is more like the HMS Vanguard.. 1917.
Two survivors.
Thanks for the correction, Joey.
Ho ho, hah hah, hehehehehehe, BwaHaHaAhHAHAHAHAHAHA!!! (Cantankerous Intellectual Bomb-thrower™)
HBOS loses millions on Vegas casino
Value of state-owned Lloyds’ overseas portfolio questioned after Penn National Gaming paid $230m for $860m debt
guardian.co.uk, Tuesday 12 October 2010 / Simon Goodley
Lloyds Banking Group, the partially state-owned lender, has lost more than $500m (£317m) on loans to M Resort Spa Casino in Las Vegas – the second massive financial hit the bank has taken in America in as many months.
The debt sale comes two months after it emerged that HBOS International was set to lose “tens of millions of pounds” from dealings with another US client, Sea Island, the exclusive Georgia holiday retreat that filed for bankruptcy in August. In that case, court documents said Sea Island was unable to pay back close to $600m in debts owed to a consortium of banks that included HBOS, which were taken out to fund an ambitious expansion plan. The company said it planned to sell its coastal resorts to investment funds Oaktree Capital Management and Avenue Capital Group in a $197.5m.
The deal to buy the HBOS debt has given Penn a Las Vegas casino for a fraction of what it cost to build the 390 room resort. Opened in March 2009, the M Resort is located well away from the main Las Vegas Strip, which is considered the heart of the casino city. It lies about 10 miles south of the Mandalay Bay casino and is surrounded by planned housing communities.
…and is surrounded by planned housing communities.
Planned? Try metastasized.
Debt market strips U.S. of triple-A rating
October 12, 2010
The United States has lost its gold-plated triple-A rating — in the eyes of credit traders, at least.
U.S. sovereign debt was the third-worst performer in a closely watched derivatives market during the third quarter, CMA said Tuesday in its quarterly review of global sovereign credit risk.
Not a vote of confidence
The cost of insuring against a default on U.S. government bonds via so-called credit default swaps rose 28% in the quarter ended Sept. 30, the firm said.
That puts the United States’ third-quarter performance behind only two other nations, both of which are struggling with the early stages of sovereign debt crises: Ireland, whose CDS prices rocketed 72% to a record amid growing questions about the costs of a massive bank bailout, and Portugal, whose costs jumped 30%.
What’s more, the decline leaves U.S. debt trading at an implied rating of double-A-plus for the first time in memory.
Despite building worries about its financial outlook, the U.S. had traded in recent quarters in line with its triple-A rating from S&P and Moody’s. But some skeptics have been arguing the U.S. is overrated, and that argument now seems to be gaining steam.
Expect a news conference from Ralph Nadar at any moment…
BWAHAHAHicHAHAHicHAHAHAHAHicHAHAHic* (DennisN™)
http://news.yahoo.com/nphotos/Giant-Radio-Flyer-Car/ss/events/us/101210radioflyercar#photoViewer=/101012/480/urn_publicid_ap_org7ecac3149495405089050abca3a93ae4
Now THAT’S pretty funny!
which-way-will-stocks-go-in-october-marc-faber-weighs-in
“And cash? Cash will be dead, says Faber, as its purchasing power will only go down in an environment of currency debasement.”
beaconequity
Foreclosure Delays May Cost U.S. Banks Up to $6 Billion, FBR’s Miller Says
By Dawn Kopecki - Oct 12, 2010 10:38 AM PT
Oct. 12 (Bloomberg) — Paul Miller, an analyst at FBR Capital Markets, talks about the political ramifications of U.S. home foreclosure errors by banks. Miller talks with Betty Liu on Bloomberg Television’s “In the Loop.” (Source: Bloomberg)
Faulty foreclosures may cost U.S. lenders $2 billion for every month that home seizures are delayed and the tab could reach $6 billion, according to Paul Miller, the bank analyst at FBR Capital Markets.
Investigations of how banks are seizing homes may prolong foreclosures by as much as three months, at a rough cost of $1,000 per month for each property in the pipeline, Miller, a former bank examiner, said in an interview today. The biggest firms likely need to add staff to comb through the files, costing them each $1 million a year, he said.
“The real true cost is not the expenses, it’s the drag in the foreclosure system,” Miller said.
…
$6 billion isn’t squat. Our banks create that much with accounting tricks before breakfast.
My thought, exactly — though it does beat token (aka “wrist slap”) fraud damages recently levied against Megabank, Inc in amounts less than $1 bn.
yeah.. but in the long run, who actually pays for all this stuff?
“consumers” do.
Well.. more precisely, working consumers.
yeah.. but in the long run, who actually pays for all this stuff?
I know, but sometimes some things are just worth paying for.
Unless you work in the court system or are an attorney and are on the receiving end, how could this crap be worth paying for?
at a rough cost of $1,000 per month for each property in the pipeline
Banks pay nothing, or will at lest recover every penny out of pocket.
This is on the backs of taxpayers (in court costs) and bank customers (in the form of fees and maybe interest rates).
Additionally, just like you pay some extra 7% when you buy something in a store to make up for losses from shoplifters and employee theft, we all will pay forever for this one too.. It’s a new “legitimate” reason to charge us extra.
Unless you work in the court system or are an attorney and are on the receiving end, how could this crap be worth paying for?
If that was to me, you are missing the much greater point.
yes that was to you, rio.
i ignored your unspoken point, but i didn’t miss anything.
We keep score with money, not egos, and while yours might be stroked at the thought that this makes the banks look bad, the banks will laugh all the way to the bank.. as usual.
i ignored your unspoken point, but i didn’t miss anything.
You got it. The second time I’ sure.
We keep score with money,
That’s obvious, and your ultimate, limiting failing in a world composed of more.
Your bank’s powers have come and gone in history. This is nothing new. They have now past their zenith and follow the cycle to their nadir.
It’s an old story and pattern. Fight it, fine. You’re not going to stop it.
$6 billion isn’t squat. Our banks create that much with accounting tricks before breakfast.
Yep.
Not only that, but I’m guessing that doesn’t include the offset bonus the foreclosure freeze will cause, in the form of higher housing prices, and thus lower default rates in the long run. You wait.
The freeze may not actually cause prices to go up, but it’ll certainly cause them to fall slower than they otherwise would.
http://politicalticker.blogs.cnn.com/2010/10/12/tea-party-express-says-theyll-target-barney-frank/
Tea Party Express targeting Barney Frank, the poster boy for government meddling in the housing market and enabler for irresponsible FBs. While I have my reservations about the Tea Party, I wish them every success in turning this clown out of office.
One person voting for Barney would be unexpected by me. what kind of jackass supports a guy like that.
The same kind of Republicrat jackasses who put Obama in the White House, and Bush before him, and basically an entire Congress that toadies for Wall Street.
These jackasses install incompetents in the driver’s seat, then piss and moan when the country ends up in the ditch.
” what kind of jackass supports a guy like that.”
The kind of jackass that likes a good Abba song.
Friday night and the lights are low
Looking out for the place to go
Where they play the right music, getting in the swing
You come in to look for a king
Anybody could be that guy
Night is young and the music’s high
With a bit of rock music, everything is fine
You’re in the mood for a dance
And when you get the chance…
You are the Senate queen, cruising boys that are seventeen
Senate queen, feel the beat from the tambourine
You can dance, you can jive, having the time of your life
See that boy, watch that scene, dig in the Senate queen
Oh man! You ruined the song that I took as the theme song for one of the two most beautiful girls in my high school class of ‘77.
But the words here are funny.
I think I’ve hurt myself laughing again!
Good job Jeff!
You are the Senate queen, cruising boys that are seventeen
Funny but maybe I missed something. Barny Frank, Senate?
Sorry, please insert Congress Queen where applicable.
Sorry, please insert Congress Queen where applicable.
Even better because of more alliteration.
…plus the double entendre.
http://action.seiu.org/page/speakout/wheresthenote?js=true
New website going viral: “Where’s the Note?” where FBs can see if their robo-signing banksters really hold their mortgage - and call their bluff.
WARNING ON THIS: I would NOT enter my information on this site. This is run by the infamous SEIU and I never entrust this gang, who are the equivilant of Obama’s “civilian army,” with my personal data.
What is significant about this development is that now that this Administration, like the Bush Administration before it, has done away with any notion of personal responsibility or moral hazard, millions of FBs with nothing to lose could decide to force the banks to either ante up a valid mortgage document, or get used to the idea of FBs living rent-free into perpetuity. A very convenient steaming turd to hand the banks, just in time for a Republican sweep in November.
A very convenient steaming turd to hand the banks, just in time for a Republican sweep in November.
I’m trying really hard to feel sorry for the banks but it’s really hard to accept the thought of banks “teaching” the American public lessons on personal responsibility. Besides, this is one way the public can get some of their own taxpayer bailout money that went only to the banks. It might not be “right” but is it just?
As far as “steaming turds” and politics, that’s the way it works. Banks are donating about 75% to Republicans now. Sometimes in life, a “steaming turd” is what one brings upon themselves.
Picture the carnage in the banking sector if millions of deadbeats refuse to budge from their homes until presented with a valid mortgage. Given all the MBS bundling that went on, the banksters won’t be able to produce the document in a large number of cases, or if they do, it’ll be fraudulent. So the FB gets to look forward to an indefinite rent-free stay in the limbo-house while tying up the banks legal and documentation departments.
Picture the carnage in the banking sector if millions of deadbeats refuse to budge from their homes until presented with a valid mortgage.
“They Sow the Wind, and Reap the Whirlwind” Hosea 8:1-14 -
Many have grown poorer from and weary of our system’s failed war against the inevitable whirlwind.
If it comes, it might be in a form we just didn’t expect.
The banks were AGAIN, committing outright fraud.
I’m not feeling real sorry for the banks either.
In states where foreclosures are subject to judicial review, the banks are required to submit documents that establish their rights to the property in question. In general, it’s a really bad idea to submit a fraudulent document to a court of law. This is the only reason why the banks have instituted a freeze on foreclosures.
“…retired Air Force officer, Stanley A. Fulham, tentatively predicts October 13, 2010 as the date for a massive UFO display over the world’s principal cities.”
http://news.yahoo.com/s/prweb/20100914/bs_prweb/prweb4491804_1
This should knock home prices down a bit.
Stanley gets his 15 minutes of fame, but Sammy confidently predicts the UFOs will be a no-show.
More on the “retired AF Officer”:
Hmm, I wonder if the Transcendors can help the banks locate their notes.
This is not a hoax!
An alien ship will be disguised as a yellow dwarf star and will quietly and slowly rise in the morning from the east and will spend the day slowly transversing the heavens in a large arc while collecting data and will spend all day doing this until all the data the aliens need is collected at which time the alien ship will slowly and quietly sink below the horizon in the west.
Warning! While the alien ship is collecting its data it will be generating ultraviolet rays that will penetrate the earth’s atmosphere and may be harmful to some people.
http://www.telegraph.co.uk/news/worldnews/europe/france/8060486/France-approves-plan-to-strip-foreign-born-criminals-of-French-nationality.html
France has approved a plan to strip foreign-born criminals of their citizenship. What a concept.
Seems that the “more progressive” French are in some ways less kow towing to the race card than the U.S.
Les français: Avec les deux orphelines
Absolutely. E.g. see the recent ban on burqas.
Apparently progressive is in the eye of the beholder.
Seems that the “more progressive” French are in some ways less kow towing to the race card than the U.S.
Maybe today’s European “socialists” democracies (beholden to their people) can kick ignorance’s ass more effectively than our corrupt moribund, crony-capitalist, dual party, joke oligarchy.
The French are getting their s**t together these days. Cutting taxes, taking on the govt “workers” and their unions and fighting Islamo-Fascism.
Sadly here we are doing the exact opposite. Giving union thugs more power, granting defacto amnesty to aliens in exchange for Democrat votes and literally bowing down to Islamo-Fascists in the name of PC.
The French are getting their s**t together these days. eddie
That’s what I’ve been thinking too.
France’s model healthcare system Boston Globe
…the World Health Organization rated (Frances Healthcare System) the best in the world…because of its universal coverage, responsive healthcare providers, patient and provider freedoms, and the health and longevity of the country’s population. The United States ranked 37.
The French system is also not inexpensive. At $3,500 per capita it is one of the most costly in Europe, yet that is still far less than the $6,100 per person in the United States.
An understanding of how France came to its healthcare system would be instructive in any renewed debate in the United States.
That’s because the French share Americans’ distaste for restrictions on patient choice and they insist on autonomous private practitioners
http://finance.yahoo.com/news/Robosigners-Mortgage-apf-382327091.html?x=0&sec=topStories&pos=main&asset=&ccode=
….
Late last week, in an interview with the Florida attorney general, a former senior paralegal in Stern’s firm described a boiler-room atmosphere in which employees were pressured to forge signatures, backdate documents, swap Social Security numbers, inflate billings and pass around notary stamps as if they were salt.
Stern’s lawyer, Jeffrey Tew, did not respond to a request for comment.
Meanwhile, the public outrage continues to mount. In what is perhaps a sign of things to come, a Simi Valley, Calif., couple and their nine children broke into their foreclosed home over the weekend and moved back in, according to television station KABC of Simi Valley. The couple, Jim and Danielle Earl, say they were working with the bank to catch up on payments until they discovered a $25,000 difference between what they owed and what the bank said they owed. The family was evicted from their Spanish-style two-story in July. The home has been sold, and the new owner was due to move in soon.
The Earls and their attorney now allege that they were victims of fraudulent paperwork.
Curt Anderson contributed from Miami.
Wait till millions of deadbeats feel empowered to squat in houses until banks present valid mortgage documents - if they can. Then the FBs can get a lawyer to find any legal flaws in the document itself- there was enough fraud going around - and use it to go after the lender for the original fraud, while paying not a dime in rent for as long as they can drag thinks out.
Attorneys have to recognize this thing is “frivolous”, and there’s no way they will take a case for free. FBs aren’t in a position to pay them a retainer up front.
Given the proper media exposure, a few attorneys might make a name for themselves… possibly force banks to settle a few cases.
But all in all, i don’t see judges affording the FBs any sympathy. Ownership might be in dispute, but one thing’s for sure; the FBs own nothing, and it’ll come down to banks paying penalties to the court for robo-signing some of the docs.
—–
“Is your house in foreclosure? Do you suspect the bank might have “robo-signed” your documents? Well, here’s some good news. You may be eligible to keep your home!
Yes! That’s right. Even though you defaulted on your loan, and have no right to keep your house, find out if we can help you for a preliminary consultation fee of only $199.95!
Think that’s too good to be true? Well.. think again!”
..Meanwhile, the public outrage continues to mount..
yeah.. it’s an outrage… like when a criminal gets off on a technicality.
Just at a point in early Fall when things appeared they could not get much fuglier, they did.
Evidently if you are not paying a mortgage or rent you can afford to relax, socialize and enjoy stimulating conversation at a fancy bar.
My Events. WPB, FL. Oct 14, 2010 HAPPY HOUR for Combatants of Illegal Foreclosures
Time: October 14, 2010 from 5:30pm to 10pm
Location: E.R. Bradleys Downtown West Palm Beach, Florida.
Street: 104 Clematis St
City/Town: West Palm Beach, FL 33401
Website or Map: http://www.erbradleys.com/
Phone: 561-833-3520
Event Type: happy hour
Organized By: L
Latest Activity: 7 hours ago
Export to Outlook or iCal (.ics)
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Event Description.Come join us at our next monthly Happy Hour, an informal gathering where we can relax, socialize, enjoy stimulating conversation, and use our collective brain power to make a positive impact on the Foreclosure Crisis that is annihilating our communities.
Their “brain power” can’t even conceive of the idea that foreclosures are the CURE, not a crisis at all…
SAN FRANCISCO (AP) — Intel Corp, the world’s biggest maker of microprocessors, the “brains” of PCs, reported that its third-quarter net income leaped 59 percent and revenue rose 18 percent.
INTC is up about 1% after hours.
You were all saying something about a depression….
Does the rising power of microprocessors lift all boats?
don’t forget Intel went though some recent downsizing/layoffs, and last month severely cut prices on some chipsets by around 50%.. and some CPUs by about 15%, to “stimulate demand”, and clear inventory.
…as for even mentioning the word “depression”, why tempt fate.. Things are looking good so far, but anything can happen.
…as for even mentioning the word “depression”, why tempt fate.. Things are looking good so far, but anything can happen.
Looking really “good” so far. LOL
ok.. i take that back..
Things are looking good for those who are positioned properly. Those who aren’t are suffering to one degree or another.
C’est la vie.
You were all saying something about a depression….
?? Are you confusing us with your doctor?
Intel is a good example of what happens post-bubble and how you can never bank on something going up. IIRC, wasn’t it over 10 years ago their stock was ~70, now it is ~20. Hmmm, I wonder how many of those guys thought to buy stock now or get priced out forever 10 years ago…
I thought tech stocks only go up - Dell, Microsoft, Cisco, etc. Oh yeah, except for Apple, their stock only goes up:)
LA TIMES:
“Nearly half the people who once considered themselves supporters of President Barack Obama don’t anymore. Other than that, his virtually nonstop cross-country campaigning for embattled Democrats in the Nov. 2 election is working perfectly. Monday night, he spoke to two party fundraisers of ordinary American millionaires in Miami, as The Ticket reported here. A new poll released today by Bloomberg News finds all that hopey-changey stuff is rapidly turning to disappointment and disenchantment. Only 36% of onetime Obama supporters now approve.”
Tee hee.
As someone who has watched this bubble blow to ginormous size then slowly shrivel for over five years running, I rate this Megabank, Inc foreclosure fraud story right up there with that of the central valley agricultural worker family who bought a $700,000+ home on $30,000 in annual income, and with the foreclosed Oregon homeowner who set pigs loose in his former home.
Foreclosures in 30 Seconds Get Time Out as Florida Courts Hit a Fraud Wall
By David McLaughlin - Oct 12, 2010 9:00 PM PT
Home to more foreclosures than 47 U.S. states, Florida sought to clear out its backlog with a system of special court hearings that dispensed with cases quickly, sometimes in less than a minute.
Homeowners like Nicole West now threaten to slow that system, Florida’s so-called rocket docket, to a crawl. West, who has been fighting to save her Jensen Beach house from foreclosure, has leveled a new allegation in her three-year battle: the entire process is based on fraud.
West said her case is rife with the kind of flawed mortgage documents that have caused lenders including Bank of America Corp. and JPMorgan Chase & Co. to stop the process of foreclosures and evictions across the country. The banks said they are investigating homeowner charges like West’s that signatures were forged and documents were backdated.
“It’s not right,” said West, 40, who lives about an hour’s drive north of West Palm Beach. “It’s like lying to the judge. It’s like lying about what’s really going on.”
The bank moratoriums are already thwarting the initiative by Florida officials to clear jammed court dockets. Now, efforts by homeowners such as West to bring claims of fraud to the attention of judges are further prolonging evictions, and in turn slowing purchases of foreclosed properties.
Third-Highest Rate
Florida has the third-highest foreclosure rate in the U.S. behind Nevada and Arizona. One in every 34 housing units — double the U.S. average — was in the foreclosure process or bank-owned as of Sept. 1, data vendor RealtyTrac Inc. said.
…
* HOMES
* OCTOBER 13, 2010
Document Questions Cloud Recovery
Agents Fear Housing Could Stall as Uncertainty on Foreclosures Unnerves Buyers, Especially Investors
By NICK TIMIRAOS And DAWN WOTAPKA
Sales of foreclosed homes have helped lay the groundwork for housing recovery in many of the nation’s boom-to-bust markets. Now, some real-estate agents say that recovery is at risk because of delays in bank foreclosures.
Homes are being pulled from the market, and buyers—especially investors intent on quickly reselling foreclosed properties—are retreating to the sidelines amid growing uncertainty over the extent to which banks filed fraudulent foreclosure documents.
On Tuesday, Wells Fargo & Co. said it had started a review of all pending home foreclosures in states where certain paperwork was required but it did not suspend foreclosures or foreclosure sales, as have other big banks.
Meanwhile, GMAC Mortgage, a unit of Ally Financial Inc. and one of the first to suspend some foreclosures last month, expanded its review to all 50 states. Initially GMAC’s review was limited to 23 states that require court approval for foreclosures.
Bank of America Corp. last Friday agreed to halt all foreclosures and foreclosure sales, the first bank to do so.
Uncertainty about the legitimacy of foreclosures threatens the market because about one in four homes sold during the second quarter was in some stage of the foreclosure process, according to RealtyTrac Inc., which tracks foreclosure filings.
Some in Congress have called for a nationwide foreclosure moratorium, but Obama Administration officials said they didn’t support such a broad move.
“If there is an empty house in the neighborhood that somebody has a contract on, and their closing date is next week, and there is a moratorium, that closing doesn’t happen,” Robert Gibbs, the White House press secretary, told reporters on Tuesday.
…