The Housing Bubble

Once in a while to gauge how the best and the brightest are fairing during these dark days I examine the weekly Nantucket real estate transfers. Oddly, buyers identities are usually hidden behind a Delaware LLC or trust of some sort . Since it’s time consuming to dig through LLC papers I exclude the pedestrian buyer and focus only on those above five million.

I was concerned sales might be slowing since for 24 straight weeks, retail investors have been pulling tens of billions of dollars out of U.S. mutual funds. That had me worried that true pillars of our economy might be suffering. Thankfully that doesn’t seem to be the case, they still have our pensions. The five million plus sales from the past week include the usual deserving folk; a Morgan Stanley VP, two pension hedge fund managers and the biggest to a true defender of our Fifth Amendment rights.

30 Washing Pond sells for $20,000,000; listed in June for $23,950,000, it went to Purchase and Sale on July 28th and closed on October 13th”
The manager of LLC which bought the property is listed as one Elizabeth A. Tilney.:

“Schuyler Tilney, the Merrill managing director, “had a special relationship with Enron,” according to the New York Times. When called to testify before Senate committee examining Enron’s deals with the Bank in July 2002, Tilney invoked his Fifth Amendment right and refused to testify. Tilney was part of a group of Merrill executives who invested about $16 million in LJM2, one of the offshore partnerships set up by Fastow. These investments created a conflict of interest in Merrill’s ability to advise other investors with respect to Enron, say critics. Merrill earned about $40 million in investment banking fees from Enron between 1997 and 2001.
Tilney was a close personal friend and even vacationed with Enron CFO Andrew Fastow. His wife, Elizabeth A. Tilney was a senior Enron executive and personal friend of Ken Lay, who after receiving a letter from Enron whistleblower Sherron S. Watkins complaining about CFO Andrew Fastow’s partnerships and the possibility that Enron would “implode in a wave of accounting scandals,” directed Wakins to devise a crisis management strategy with Ms. Tilney (despite the fact that her husband had invested in one of those partnerships — LJM2). Ms. Tilney was also the marketing executive who in 1997 introduced the company’s new logo, the “crooked E. and set up the companies values campaign.

In another instance, Merrill Lynch was set to make a $17 million profit on a bogus energy trade that allowed Enron to book $50 million in profits. When one Merrill executive expressed ethical reservations, a second responded that the firm had “17 million reasons” for completing the deal, according to the SEC. Schuyler Tilney, a Houston-based Merrill banker who managed the firm’s relationship with Enron, later wrote in a memo to his colleagues that “we were clearly helping them make earnings for the quarter and year (which had great value in their stock price, not to mention personal compensation).”

“Futures, World Stocks Lower As Earnings Disappoint.”

This is the headline from today’s Yahoo Finance. It is much different from some previous day’s headlines when the market soared up a bunch of points.

The market is treated as a yo-yo and retail investors who repeatidly get sucked in and shaken out are also treated as yo-yos. These investors are what feeds the Wall Street Machine.

But it is too bad for Wall Street that the retail investor is running out of money (money powered by hope) to feed into this machine.

Look for lower volume and lower prices in the coming year or two as this depression thingy rolls on and the political scandals really begin to burst forth.

Warning signs of foreclosure crisis were ignored, says FDIC Chairman Sheila Bair ~ Washington Post

Sheila C. Bair, chairman of the Federal Deposit Insurance Corp., said Monday that federal officials should have recognized “warning signs” in recent years that the mortgage industry was cutting corners in the foreclosure process.

Bair, one of the country’s top banking regulators, said both the federal government and the financial industry should have questioned how it was possible that banks were cutting their costs in foreclosing on homes without running afoul of standards.

“Sadly, those types of questions were not asked,” she said at a housing conference in Arlington.

Speaking at the same event, Federal Reserve Chairman Ben S. Bernanke said banking regulators plan next month to issue the first formal federal assessment of the latest foreclosure crisis, which has raised questions about whether lenders have been seizing people’s homes legally.

Wow, the IAR reports September sales data for Chicago is ugly - down just shy of 27% y-o-y for the city proper. The region and the state weren’t so hot as well with having declines well into the twenty percent range.

September 2010 was the weakest September for sales of this event by far, beating even 2008 by a considerable margin! Prices are also down, but this data suggests another leg down in prices is waiting in the wings.

Interesting times in the bond market. Long term yields are at rock bottom levels due to fears of deflation. But TIPS yields are negative due to fears of inflation.

We know we are screwed, but we still don’t know how we are screwed. Instead of Golidlocks, we’re pinned down waiting to see which bear mauls us.

Fannie Mae halts all foreclosure cases handled by David J. Stern

by Kim Miller
8:41 PM Monday, October 25, 2010

Fannie Mae said today it has halted all foreclosure proceedings that were handled by the David J. Stern law firm in Plantation, adding to a previous announcement that it would no longer send new business to the company.

According to spokeswoman Amy Bonitatibus, Fannie Mae has suspended all activity on cases with the Stern firm that are not already subject to a foreclosure pause by servicers.

“We are working closely with our regulator on this matter,” Bonitatibus said. “In instances where we learn that a firm is not adhering to our requirements or to applicable law, we immediately engage and take appropriate action, which may include suspending or terminating the firm, and notifying appropriate law enforcement and regulatory authorities.”

The Deal by Allan Sloan
Want to get away with murder? Become a bank.

GMAC and BofA have now resumed foreclosures in some states. By the time you see this, J.P. Morgan may have done so too.

By Allan Sloan, senior editor-at-large
October 26, 2010: 5:40 AM ET

FORTUNE — The biggest danger to the U.S. capitalist system doesn’t come from communists or community activists or left-wing academics. It comes from some of the nation’s biggest financial institutions. These companies, which helped create the financial meltdown that touched off the Great Recession, have now found yet another way to undermine the public’s faith in capitalism and markets: the foreclosure fiasco.

Even before the foreclosure problem appeared, the level of public distrust of our financial and political systems was approaching the pathological. It’s going to get even worse when the true lesson of this episode sinks in. To wit: If you screw up big-time when you deal with a giant bank, you’re toast. If the giant bank screws up when it deals with you, it gets a do-over.

Sure, many — probably most — of the people whose mortgages are being foreclosed got in trouble because they overreached or lost their jobs, not because anyone cheated them. But if we’re going to have rules, they ought to be binding on everyone. If I’m supposed to obey the law and pay my bills, the people I’m paying ought to have to obey the law too.

You miss a payment on your credit card or send it in a few days late, you get whacked. Forget to make a loan payment, your credit rating gets vaporized. But if a bank doesn’t do its job properly — for example, if you can’t get a knowledgeable and competent human on the phone to deal with a loan modification or a paperwork screwup because the bank is holding down back-office costs to save money — it ends up being your problem, not the bank’s.
…

Sex, Drugs, and the Subprime Meltdown

— Jay Mallin/Zumapress.com

Author Michael W. Hudson on the fraud-riddled industry that fueled America’s biggest housing bubble.

— By Andy Kroll

Tue Oct. 26, 2010 3:00 AM PDT

“Foreclosuregate,” as the latest horrible housing mess to befall the US is now being called, is yet another aftershock from the financial earthquakes of 2008 and 2009. But despite dozens of books chronicling Wall Street’s collapse, few authors have charted the breathless rise and spectacular fall of the subprime mortgage industry behind the catastrophe.

Investigative journalist Michael W. Hudson’s new book, The Monster: How A Gang of Predatory Lenders and Wall Street Lenders Fleeced America—And Spawned A Global Crisis, does just that. A staff writer at the Center for Public Integrity, Hudson gives subprime the full treatment it deserves, tracing the industry from its birth—in the ashes of the savings and loan crisis—to its implosion, decades later.
…

Orange Growers Fall Victim to Property Bust ~ WSJ

As if the real-estate bust hadn’t wreaked enough havoc on Florida, farmers say abandoned lots left behind by would-be developers have become a breeding ground for a plague that is killing thousands of the state’s orange trees.

A type of tiny lice known as the Asian citrus psyllid has made its home in the orchards, spreading a disease known as citrus greening, or yellow dragon disease, which causes trees to produce shriveled, bitter oranges before killing them. Since being spotted in 2005, the disease has spread to all parts of the state. And with no known cure, citrus greening is threatening to cripple a $9 billion-a-year industry that supplies 90% of U.S. orange juice.

“It’s been one uppercut after another,” said Jackie Burns, interim director of the Citrus Research Education Center in Lake Alfred, Fla., which has studied the outbreak. She said she has no doubt that “grove abandonment” has helped spread the disease.

The U.S. Department of Agriculture says millions of acres of crops have been devastated by the disease in the southern U.S.

I can’t remember - is GMAC part of ObamaMotors or was it spun off to Ally Bank?
—————–

Short Sales Resisted as Foreclosures Are Revived
New York Times | 10/26/10 | Michael Powell

PHOENIX — Bank of America and GMAC are firing up their formidable foreclosure machines again today, after a brief pause.

But hard-pressed homeowners like Lydia Sweetland are asking why lenders often balk at a less disruptive solution: short sales, which allow owners to sell deeply devalued homes for less than what remains on their mortgage.

Ms. Sweetland, 47, tried such a sale this summer out of desperation. She had lost her high-paying job and drained her once-flush retirement savings, and her bank, GMAC, wouldn’t modify her mortgage. After seven months of being unable to pay her mortgage, she decided that a short sale would give her more time to move out of her Phoenix home and damage her credit rating less than a foreclosure.

She owes $206,000 and found a buyer who would pay $200,000. Last Friday, GMAC rejected that offer and said it would foreclose in seven days, even though, according to Ms. Sweetland’s broker, the bank estimates it will make $19,000 less on a foreclosure than on a short sale.

“I guess I could salute and say, ‘O.K., I’m walking, here’s the keys,’ ” says Ms. Sweetland, as she sits in a plastic Adirondack chair on her patio. “But I need a little time, and I don’t want to just leave the house vacant. I loved this neighborhood.”

After the illegal immigrant domestic story and now this, one has to wonder what other skeletons might lie hidden in Meg’s walk-in closet.

Meg Whitman’s son, Griffith Harsh V, accused of sexual assault of Princeton classmate: report

By Corky Siemaszko
DAILY NEWS STAFF WRITER
Monday, October 25th 2010, 11:14 AM
…

“Harsh” sounds like a real sweetheart, doesn’t he?

Rape accusation against Whitman’s son kept quiet
October 23, 2010 5:34 pm

The son of Republican gubernatorial candidate Meg Whitman was accused of sexually assaulting a female classmate while a student at Princeton University–a school that lists Whitman as one of its most generous donors.

Critics contend that the incident has been downplayed by university officials, unwilling to embarrass the former e-Bay CEO who has donated more than $30 million to the Ivy League school.

Griffith Rutherford Harsh V was never arrested or charged with a crime in connection with the 2006 incident. Princeton dealt with it quietly and internally, ultimately allowing Harsh to continue his education. He graduated with the class of 2009, three years after his rape accusation—and two years after the inauguration of Whitman College, the residential living complex his billionaire mother donated $30 million to help build.

A young woman, a classmate of Harsh, told university officials that she awoke one morning with a black eye, bruised and bloodied face, and no memories from the previous night. Harsh admitted to having sex with the woman, but insisted it was consensual, and that her injuries had come from falling down.
..

Cuba self-employed to pay taxes up to 50 percent

HAVANA (Reuters) – Cuba has set income tax rates at 25 to 50 percent for its soon to be expanded private sector, with the biggest earners paying the most taxes, according to official decrees published on Monday.

The rates will range from nothing for those making 5,000 pesos — equivalent to $225 — or less a year to 50 percent for those in the highest bracket, which is more than 50,000 pesos, or $2,252.

The new tax rates came out in the Official Gazette as the government prepares to cut 500,000 workers from state payrolls and issue 250,000 new licenses for self-employment to create new jobs in President Raul Castro’s biggest economic reform so far.

Those making more than 5,000 pesos will have to pay taxes, starting at a rate of 25 percent and rising from there as income increases.

The cash-strapped government is looking to the self-employed to increase tax revenues to help pay for expensive social programs such as free health care and education.

I actually feel that the fraud associated with the origination of loans and the marketing of them was the original crime .Why wouldn’t that corrupt system process foreclosures like a slaughter house afoul of the law in keeping with their true colors . I think also the message here is there isn’t any regulators watching or auditing the loan system . What kind of
message is this about the Feds being a regulatory agency ? Seems like there isn’t any meaningful regulations or watchdogs or auditors. This makes the current financial reform a joke also in that it calls for
regulators to gage and regulate the activities of Banks and Middlemen .Looks like they won’t discover things until it’s to late and a outside lawyer has to discover the crimes or the Court system runs into it . They needed to have financial reform that just controls
things by defined laws that had hard punishment if violated with constant audits .The moral hazard of how entities acts when they aren’t busted but bailed out instead keep coming back and will continue to haunt the financial system until the correct reform comes about .This meaningful reform came about after the crash of 1929 and was undone by de-regulation and all the other self-governing that doesn’t work in the financial arena . The Kingpins of this financial crisis had to much of a say
so in the financial reform package just as the Health Insurance Monopolies had to much of a say-so in Health care reform .
much of a say-so in h

Ahead of the Bell: Home Prices
Index of home prices in 20 cities likely fell in August from July as housing market weakens

WASHINGTON (AP) — A gauge of home prices in 20 large U.S. cities is likely to dip in August, reversing four straight months of gains, as the weak economy caused buyers to shy away from purchasing homes.

The Standard & Poor’s Case-Shiller index of home prices in 20 major U.S. cities is likely to dip about 0.6 percent in August from a month earlier, forecasts Quinn Eddins, director of research at Radar Logic Inc., which tracks the housing market.

Though the report looks at prices in 20 cities, the trends vary. Prices are setting new lows in foreclosure-plagued Las Vegas, which is down 57 percent from the peak in August 2008. By contrast, San Francisco’s prices are down only 5.4 percent in that same time period.

Sign of a growing economy - LaidOffCamp :

http://www.abc15.com/dpp/news/region_southeast_valley/chandler/laidoffcamp-helps-encourage-job-seekers

There was a time in the history of USA tax law that the higher income
brackets paid a 70% rate on certain portion of income ,course they had more write offs to offset that high tax rates .

The Cynically Ruthless Barney Frank, Enabler Of The Mortgage Meltdown
By THOMAS SOWELL
IBD

Congressman Barney Frank of Massachusetts best epitomizes the cynical ruthlessness that hides behind their lofty rhetoric.

Having been a key figure in promoting the risky mortgage lending practices imposed by the federal government on lenders, and on Fannie Mae and Freddie Mac to buy these risky mortgages from the lenders, Frank blamed the resulting collapse of financial markets and the economy on everybody except Barney Frank.

In February 2009, as chairman of the House Financial Services Committee, Congressman Frank summoned the heads of some of the biggest banks in the country before his committee. In the words of the Los Angeles Times, these bankers “endured hours of hectoring” by “indignant lawmakers” on that committee.

These bankers were in no position to talk back to members of this committee, much less point out how committee members — including Chairman Frank — had themselves promoted laws and policies responsible for the current economic disaster.

Congressman Frank has never hesitated to use his power ruthlessly. On one occasion, he threatened bankers with summoning them before his committee and forcing them to reveal their home addresses — which would of course put their spouses and children at the mercy of any kooks that might come along.

Meanwhile, Congressman Frank could piously invoke “social justice” in defense of similarly ruthless community activist groups like Acorn or National People’s Action, which had in fact besieged the homes not only of bankers but also of public officials who dared to oppose their agendas.

In Frank’s words, these groups were simply people who “cared about equity” and who were just “trying very hard to preserve some equity and some social justice.”

But the harassment and shakedown activities of such groups were perhaps best captured by the words of a leader of one of these groups, who addressed her followers by saying: “We want it. They’ve got it. Let’s go get it.”

These were not just idle words. The dirty little secret that few in the media seem to want to discuss is that community activists, including Jesse Jackson, have over the years extracted literally billions of dollars from financial institutions, as the price of peace and of not challenging these institutions in hearings before federal regulators, as these groups are empowered to do under the Community Reinvestment Act.

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=550868

Can’t wait for this story to break. Go Matt!!!

Posted: Today,11:44 A.M. EDT | By Matt Taibbi
Bank of America Admits Many Foreclosure Mistakes

So I’m on my way to Florida, to work on a story about the foreclosure crisis. On my way I wanted to post this bit of news, that Bank Of America has conceded to a significant percentage of errors in its review of pending foreclosures.

This clashes directly with what it said on October 18, when it said that an initial review indicated that “the basis for our foreclosure decisions is accurate.” It now says that between 10 to 25 of the first few hundred foreclosures it reviewed were faulty. And that’s only what the bank is admitting to.
…

* October 25, 2010, 9:28 AM ET

Bank of America Faces Bearish Tide
By Dave Kansas

Steven M. Sears over at our sister publication, Barron’s, says the market has an increasingly dim view of Bank of America’s outlook.

He writes “According to trading patterns, some options traders are betting that BofA’s $11 stock could fall to $2.50 by 2013. Indeed, its $2.50 puts that expire in January 2013 have been actively traded since Tuesday.”

That would be a very grim performance. And Steven says that nearer-term options activity underscores the negativity around BofA. In order to fund November $10 and $12 puts, these traders are selling bullish calls in large numbers. Such a trade is made when investors have high confidence a stock is heading down.

The storm clouds for BofA include the mortgage foreclosure fiasco and a still challenging housing and lending market overall. Over the weekend, BofA admitted to its first errors in its internal examination of foreclosure processing.
…

No Bubble - No Profits:

Just imagine if they weren’t allowed to use fraud to make profits also.

http://www.marketwatch.com/story/the-new-wall-street-no-bubble-no-profits-2010-10-26?dist=beforebell

The Idiocy of Politics
Why no intelligent discussion can ever occur in the hellscape of politics…
by Stefan Molyneux

http://tinyurl.com/2dc82dj

So intelligent.

Megabank, Inc would rather leave neighborhoods riddled with vacant homes than to screw up the comps with short sales. Price discovery is to be avoided at all costs.

Short Sales Resisted as Foreclosures Are Revived
By MICHAEL POWELL
Published: October 24, 2010

PHOENIX — Bank of America and GMAC are firing up their formidable foreclosure machines again today, after a brief pause.

But hard-pressed homeowners like Lydia Sweetland are asking why lenders often balk at a less disruptive solution: short sales, which allow owners to sell deeply devalued homes for less than what remains on their mortgage.

Ms. Sweetland, 47, tried such a sale this summer out of desperation. She had lost her high-paying job and drained her once-flush retirement savings, and her bank, GMAC, wouldn’t modify her mortgage. After seven months of being unable to pay her mortgage, she decided that a short sale would give her more time to move out of her Phoenix home and damage her credit rating less than a foreclosure.

She owes $206,000 and found a buyer who would pay $200,000. Last Friday, GMAC rejected that offer and said it would foreclose in seven days, even though, according to Ms. Sweetland’s broker, the bank estimates it will make $19,000 less on a foreclosure than on a short sale.

“I guess I could salute and say, ‘O.K., I’m walking, here’s the keys,’ ” says Ms. Sweetland, as she sits in a plastic Adirondack chair on her patio. “But I need a little time, and I don’t want to just leave the house vacant. I loved this neighborhood.”
…

I heartily agree with Obama’s decision to encourage the banks to roar ahead with foreclosures, provided that justice is ultimately served to any banks which are found in violation of the law.

Newsweek
Should Obama Halt Foreclosures?

Some say a moratorium is the only way to protect homeowners from fraud, but the banks disagree.

As the American economic malaise moves into its third year, the plague of home foreclosures continues to spread. It’s hardly news that people are still losing their houses, unable to keep up with payments because of job losses or bad decisions on loans that should never have been made.

What is alarming, though, is that another wave of foreclosures is headed toward America’s suburbs, threatening further injury to the housing market. In the next three years, there are likely to be 3 million more homes seized, according to RealtyTrac, a real-estate-research firm. That would be as many as were seized from 2008 through today, a period that included the worst of the recession. In September alone there were more than 100,000 foreclosures, the most since RealtyTrac began following the numbers in 2005.
…
Regardless of any moratorium, banks already own a massive portion of the American housing market. Financial firms currently have an estimated stockpile of more than 900,000 foreclosed houses, according to RealtyTrac. Only about a third of them are up for sale.

If banks stopped new foreclosures, and sold only from their current inventory at the current rate, it would take nearly a year and a half before they ran out. That means whether or not further foreclosures are delayed, vacant homes will litter American neighborhoods for years to come.

Puerto Rico unveils tax cuts to reignite economy

SAN JUAN, Puerto Rico (Reuters) - Puerto Rico’s governor on Monday announced plans to cut business and income taxes by more than a $1 billion annually over the next seven years in an attempt to jump-start the U.S. territory’s economy.

Governor Luis Fortuno laid out the plan in a special address to the Puerto Rican legislature after a weekend vote by lawmakers to slap a six-year tax hike on offshore manufacturing firms operating on the island.

Fortuno called the plan the biggest tax relief package in Puerto Rico’s history and said ordinary taxpayers would see a 50 percent reduction in their taxes when the reform is fully implemented.

Businesses would receive an average 30 percent cut, he said.

Oct. 26, 2010, 9:12 a.m. EDT
US Stock Futures Slide Further After Case-Shiller Data
By Kristina Peterson

NEW YORK (MarketWatch) — U.S. stock futures slid further Tuesday after an index of home prices fell in August, ending a long string of monthly increases.

Dow Jones Industrial Average futures fell 47 points to 11068, while Standard & Poor’s 500-share futures shed 6 points to 1177 and Nasdaq 100 futures lost 8 points to 2100. Prior to the data, Dow futures had been down 37 points, while S&P 500 futures lost 5 and Nasdaq futures were off 7. Changes in stock futures do not always accurately predict stock moves after the opening bell.

U.S. home prices fell in August from a month earlier, ending their climb since April, according to the S&P/Case-Shiller home-price indexes. The index of 10 major metropolitan areas fell 0.1% in August compared with July, while the 20-city index declined 0.2%. Adjusted for seasonal factors, the 10-area index fell 0.2%, while the 20-area declined 0.3%.
…

“Val Kilmer feeling sting of housing market? — Actor slashes ranch price by $10 million”

http://www.santafenewmexican.com/Local%20News/Pecos-Kilmer-feeling-sting-of-housing-market-

“The October 2003 edition of Rolling Stone carried an article about Kilmer, quoting him about living in the ‘homicide capital of the Southwest’ where 80 percent of the residents are drunk.”

Heh heh. I remember the howls of protest about that comment. I think he was pretty much on target.

U.S. Falls in Annual Corruption Survey ~ nytimes

PARIS — Perceptions of corruption in the United States have worsened over the last year, knocking it out of the top 20 in global rankings released Tuesday by the watchdog group Transparency International.

The top and bottom three countries on the list remain unchanged from 2009: Denmark, New Zealand and Singapore are seen as having the world’s cleanest governments, while Somalia, Afghanistan and Myanmar, are seen to have the most corrupt.

Finland, Sweden, Canada, Netherlands, Australia, Switzerland and Norway rounded out the top 10. Japan ranked 17, Britain ranked 20.

The United States, which ranked 19th in 2009, fell to 22. Also falling in the rankings were the Czech Republic, Greece, Hungary, Italy, Madagascar and Niger. “Notable among decliners are some of the countries most affected by a financial crisis precipitated by transparency and integrity deficits,” the organization said.

Nancy Boswell, the head of the organization’s U.S. branch, told Reuters that the subprime crisis, the disclosure of Bernard Madoff’s Ponzi scheme and political funding disputes had hurt America’s ranking.

“We’re not talking about corruption in the sense of breaking the law,” she told Reuters. “We’re talking about a sense that the system is corrupted by these practices.”

Question

Dec. 7 I will go to the court hearing to set the sale of the house I am renting. If my LL comes up with the defence of the broken chain of title, can I ask the judge to not make me pay rent because the missing name on the title might be mine?

What a shock! NOT! I have been watching the ‘regulatory’ noose tightening around the necks of small businesses for over 30 years now.

Small businesses losing out to red tape ~USA Today

In an economic climate with few jobs and cutbacks on basic city services such as police protection and firefighting, you would think cities and states would be overjoyed when someone was willing to open up a new business, bringing with him jobs, economic vitality and tax revenues. You might think that, but you’d be wrong.

Instead, cities and states stifle new small businesses at every turn, burying them in mounds of paperwork; lengthy, expensive and arbitrary permitting processes; pointless educational requirements for occupations; or even just outright bans. Today, the Institute for Justice released a series of studies documenting government-imposed barriers to entrepreneurship in eight cities. In every city studied, overwhelming regulations destroyed or crippled would-be businesses at a time when they are most needed.

Time and again, these reports document how local bureaucrats believe they should dictate every aspect of a person’s small business. They want to choose who can go into which business, where, what the business should look like, and what signs will be put in the windows. And if that means that businesses fail, or never open, or can operate only illegally, or waste all their money trying to get permits so they have nothing left for actual operations, that’s just too bad. This attitude would be bad enough in prosperous times, but in a period of financial strain and high unemployment, it’s almost suicidally foolish.

http://www.usatoday.com/news/opinion/forum/2010-10-21-mellor26_st_N.htm

26 October 2010 Last updated at 10:59 ET
US house prices dip again in August

Foreclosed home in Las Vegas US house prices are being weighed down by an overhang of unsold repossessed properties

US house prices began falling again in August after the expiry of homebuyers’ tax credits, a survey suggests.
…
Unsold inventory

A tax credit for homebuyers expired in April, leading to a steep drop in home sales over the summer.

That same effect now appears to be feeding into house price data, which are published with a two-month lag.

June and July saw more stable prices, suggesting that the actual drop-off in prices in August was sharper than the fall in the index, which tracks a rolling three-month average.

Compared with last year, the index published by rating agency Standard and Poor’s was up 1.7%, somewhat lower than analysts’ expectations of a 2.1% year-on-year rise.

But prices remain 29% below their peak of May 2006, according to the index, having only recovered some 5% since bottoming out in May 2009.

Meanwhile, the inventory of unsold houses - including many foreclosed properties owned by the big US mortgage lenders - remain at a historically high level, suggesting continued downward pressure on home prices.

According to housing market analyst Bill McBride, the unsold houses represent almost 11 months worth of supply, well above the historic norm of four to five months.

“The housing market appears to have stabilised at new lows,” said David Blitzer, chairman of the index committee at Standard & Poor’s.

“At this time, it does not seem that any of the markets are hanging on to the temporary momentum caused by the homebuyers’ tax credits.”
…

Improving water systems — and infrastructure generally, if properly done — would go a long way toward improving the nation’s dismal economic outlook. According to the U.S. Conference of Mayors, every dollar invested in water and sewer improvements has the potential to increase the long-term gross domestic product by more than six dollars. Hundreds of thousands of jobs would be created if the nation were serious about repairing and upgrading water mains, crumbling pipes, water treatment plants, dams, levees and so on.

Millions of jobs would be created if we could bring ourselves to stop fighting mindless wars and use some of those squandered billions to bring the nation’s infrastructure in the broadest sense up to 21st-century standards…does any politician talk about this????,or is it just bail out the bankster……

The New Wall Street: No Bubble, No Profits- MarketWatch

The bailouts have come and gone, leaving a vastly consolidated, less-competitive marketplace. Washington’s swipe at the industry, the Dodd-Frank Act, largely avoided remaking the industry or ending “too big to fail.” The economy isn’t exactly humming, but the market is up, interest rates are low and deals are getting done.

Realtors are wonderful people and they have made the world a better place to live.

Filed under: “TrueBambooLie™” trading across the “unenforceable” communist divide…;-)

Special report: Faked in China: Inside the pirates’ web:
By Doug Palmer and Melanie Lee Doug Palmer And Melanie Lee / Reuters

WASHINGTON/GUANGZHOU (Reuters)

I had ordered the bag from a website called http://www.ericwhy.com for this special report, which explores the growing problem of counterfeit merchandise sold over the Internet.

Reuters wanted to trace the problem from a consumer in Washington D.C. to the shadowy producers based in Guangzhou China, where my colleague Melanie Lee found the illicit workshops and markets.

“Whole industries now have been attacked, not from the street, but from the Internet.”

Visitors to http://www.ericwhy.com can choose from more than 1,800 imitation Louis Vuitton bags, ranging from a pink shoulder tote and a tiger-colored “Whisper bag” to a simple bright red clutch.

The one I ordered cost $122 with a $40 shipping fee, so by my definition it was not exactly cheap. But comparable bags sold at a local Louis Vuitton retail store were $1,000 or more.

I entered my Washington D.C. address and credit card information, and instantly got an email from my credit card company warning of possible fraud on my account. Soon, I received a second email, this one a receipt with a Worldwide Express Mail Service (EMS) tracking number so I could follow my package.

Ha! I love the way this is written.

Vestas CEO: Job Cuts Needed To Remain Competitive

STOCKHOLM (Dow Jones)–Vestas Wind Systems A/S (VWS.KO) is cutting 3,000 jobs, primarily in Denmark, due to an imbalance between orders and employees at the company’s operations in northern Europe.

a fake news comedian is the most influential man in america. man…we are doomed.

Activist Stomped on Outside Paul and Conway Senate Debate in Kentucky

(NEWSCORE) - The fifth and final campaign debate between U.S. Senate candidates Rand Paul and Jack Conway was marred Monday by a confrontation outside the venue in Lexington, K.Y. in which an activist was pushed to the curb and stepped on, FOX 41 reported.

Lauren Valle, a volunteer for the liberal MoveOn.org advocacy group, was allegedly assaulted by a Paul supporter as she attempted to give the Republican candidate a mock award highlighting GOP links to big business.

The incident was captured by TV news crews.

“These supporters were not very nice to me and my message, which is the same as everyone else — I just wanted to get out here with a sign, but I got my head stepped on,” Valle said. “I have a bit of a headache.”

Russian bears treat graveyards as ‘giant refrigerators’

A shortage of bears’ traditional food near the Arctic Circle has forced the animals to eat human corpses, say locals.

Russian bear Bears are reported to be raiding graveyards in search of food in Russia’s Arctic Circle republic of Komi.

From a distance it resembled a rather large man in a fur coat, leaning tenderly over the grave of a loved one. But when the two women in the Russian village of Vezhnya Tchova came closer they realised there was a bear in the cemetery eating a body.

Russian bears have grown so desperate after a scorching summer they have started digging up and eating corpses in municipal cemetries, alarmed officials said today. Bears’ traditional food – mushrooms, berries and the odd frog – has disappeared, they added.

The Vezhnya Tchova incident took place on Saturday in the northern republic of Komi, near the Arctic Circle. The shocked women cried in panic, frightening the bear back into the woods, before they discovered a ghoulish scene with the clothes of the bear’s already-dead victim chucked over adjacent tombstones, the Russian newspaper Moskovsky Komsomelets reported.

The Best of Times For Stocks May Be Ahead ~ CNBC

The midterm election may be setting the stage for a political power struggle in Washington, as Democrats and Republicans jockey for control of Congress, but it’s also stacking the deck for a much-anticipated Wall Street rally.

As such, tactical investors should be reviewing their portfolios-and upping their equity exposure-to take advantage of any post-election pop, says Joe Zidle, an investment strategist for Bank of America Merrill Lynch.

“Right now there’s fear about the U.S.economy, regulation and taxes and those are legitimate concerns, but as we look at the market our view is that it’s actually a good time to be buying equities,” he says.

History seems to agree.

According to the Stock Trader’s Almanac, the market’s sweet spot during any four-year presidency cycle is historically the fourth quarter of the midterm year and first quarter of the pre-election year.

Here’s an idea, and it would ‘create’ millions of new driving jobs. Abolish trucks and trains period. Make it mandatory all deliveries be in a Prius or the like, with a little trailer for hauling. Problem solved…Next.

Big trucks may face fuel consumption regulations ~ Driveon

The government on Monday proposed the first regulations limiting fuel consumption of work trucks — from big-rig trucks to concrete mixers, buses, even heavy-duty pickups — saying the rules finally address the thirstiest and most-polluting vehicles on the road.

The proposal, which would take effect with 2014 models and ratchet up through 2018 models, requires a public comment period and other procedures, and wouldn’t be final until next year.

The rules would raise the cost of trucks and the diesel engines most of them use, but the government says the payback in fuel-cost savings would be as fast as one year for heavily used over-the-road trucks.

Even so, “We are concerned that this could price some buyers out of the market,” says Kyle Treadway, chairman of the American Truck Dealers and owner of a Kenworth dealership in Salt Lake City. Lower fuel consumption is good, he agrees, but the federal proposal “is expected to add thousands of dollars to the cost per truck.”

Hawker Beechcraft Death Watch, Part II

Went by the local H/B dealer this morning to pick up some parts. The guy at the parts window said that his regional sales rep was one of those who got a layoff notice last Friday.

Parts are the most lucrative end of the airplane business. Laying off salesmen is a bad sign.

As far as 2banana’s comments yesterday……

-Might I suggest that a complete, ready to roll bizjet built for the civilian market, is a more complicated piece of equipment than a fuel tank for a cost-no-object government program.

Cessna tried moving their piston single engine production to Independence, Kansas in the mid-90s, for the same reasons that H/B “says” they want to move to Baton Rouge; If you want to see how that worked out, check the FAA website and see how many ADs have been issued against Independence-manufactured Cessnas, especially in the first 3-4 years of production. They were having so many problems, they were bringing back a bunch of the old timers under contract, and flying them via company airplane from Wichita to Independence every day.

I would expect that H/B would have the same problems, or worse. First of all, H/B management has shown ZERO ability to manage their company over the past 10-20 years…..basically, they were the red-headed stepchild in the Raytheon conglomorate.

Second of all, in spite of the advertisements, GA airplanes are not Mass Produced, at least in the way you think cars are mass produced. The biggest name in the business, Cessna, might deliver 300 jets this year and in their best years maybe double that.

They have been “lean manufacturing” for a long time. Meaning, in this case, they have a minimal number of employees, and run those guys into the ground with overtime to meet their numbers. Which means, in reality, that they don’t have time or the inclination, to cross-train people. Which means that there are certain critical manufacturing processes that may only have one or two guys in the WHOLE COMPANY, that have the expertise to do those critical procedures.

At Cessna, we had the “Radome Guy”. He fit all the radomes on the noses of the aircraft at the factory, mainly because he could do them fast, and not screw up the radome and cause it to be scrapped (last time I checked, they were $10K bucks). When we had one to replace in my department, we “borrowed” him from the factory. Mainly because none of our guys did enough of them to get proficient on fitting them.

There are probably a thousand other critical functions that require the same level of skill when building an airplane. None of these guy want (or need) to move to Baton Rouge, LA, and take a big pay cut while doing it. Especially since most of these skills are readily transferable to Cessna, Learjet, Spirit Aerosystems, the Boeing mod center at Wichita, various subcontractors, etc.

Their Wichita-based subcontractors aren’t going to move there either. H/B business is a small part of their business for most of them. So now, they have to truck subassembles components down from Wichita.

Yeah, they might try to use their “Expert Systems” to get things up to speed in Louisiana in 5-7 years. I personally don’t think they have that much time.

As far as their “average” pay is concerned. All the pups making $8-10 dollars an hour were laid off two years ago. In my old department, most of the guys left have 10-15 years of seniority. I expect that it’s the same way company wide, and at H/B.

Before going off on a knee-jerk rant about the unions, educate yourself. Kansas is a “Right to Work” state. Which means that union membership is optional. Which means that the IAM has never had as much power in Wichita, as the UAW had in Michigan. Look back at the last five contracts. Contracts with a bunch of 2-3% year pay raises, and
“contract signing bonuses” of a couple thousand buck every 3-4 years.

That’s why I left, after 20 years. I had no family ties to Wichita, wasn’t going any higher up the salaried-exempt scale, and could do better (pay and quality of life wise) becoming a corporate flight department maintenance manager/supervisor.

(Of course, these are my direct observations, and info I get from some of my former buddies, who are now mid-level managers or better. You can choose to believe me or not, machts nichts to me.)

Tennessee Industrial Jobs Declined 13.7% Over Past Two Years

EVANSTON, Ill., Oct. 25 /PRNewswire/ — Industrial employment in Tennessee fell 13.7% over the past two years according to the 2011 Tennessee Manufacturers Register®, an industrial directory published annually by Manufacturers’ News, Inc. (MNI) Evanston, IL. MNI reports Tennessee lost 61,289 manufacturing jobs and 613 manufacturers over the past two years.

Manufacturers’ News reports Tennessee is now home to 7,506 manufacturers employing 383,278 workers.

“Decreased demand continues to affect Tennessee manufacturing, particularly the transportation sector and industries related to the housing market,” says Tom Dubin, President of the Evanston, IL-based publishing company, which has been surveying industry since 1912. “But losses have definitely slowed over the past year.”

As the nation grows restless, will the court side with the tyrants or the people?

Oct. 26 (Bloomberg) — The Federal Reserve won’t join a group of the largest commercial banks in asking the U.S. Supreme Court to let the government withhold details of emergency loans made to financial firms in 2008.
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The Clearing House Association LLC, a group of the biggest commercial banks, filed the appeal today. Under federal rules for appeals, a lower court’s order requiring disclosure remains on hold until the Supreme Court acts.

This is in response to Spook’s comments from yesterday.

“People tell me (mostly liberal white people) that I cannot oppose homosexuality because “its not a choice, its how God made them…”; the old they were born that way, get over it routine…

so,

can people be born white supremacists?

and if so,

should we all accept the practice since “its not a choice, its how God made them, they were born that way…”
”

I have noticed that there appears to be an innate, human tendency to classify people into an us-them dichotomy. This tendency does not always express itself along color lines. Sometimes it is geographic or class based.

Examples: When I lived in Dayton in the 70s, people there told jokes about Kentuckians and called them “Briars”, regardless of color. In eastern Iowa, they told jokes about the Czechs. Where I grew up in Pittsburgh, they were Pollock jokes. My grandmother used to talk about the High Germans and the Low Germans.

So, saying that the white supremacist is “how god made them” is partially true. We seem to be made to make tribal distinctions. How that is expressed is determined by culture.

Regarding gays: There are people who are born with both sets of genitalia. Whichever choice they made, I would not consider them to be homosexual.

I see homosexuality as a continuum on the choice spectrum. There are some who were made that way by life circumstances (e.g. childhood abuse) and there are some who were born that way. In the case of childhood abuse, you may be able to “cure” the homosexuality if you can heal the trauma from abuse. For instance, a girl raped by her father may be unable to trust men. Most of the homosexuals I have met are able to form healthy relationships with people of both sexes and I believe they were “made that way”.

To Canadians the USA has always represented a law abiding country. You are our best friends; we watch your media as much as you do.

We see your jails are crammed with plea bargains, guity or not, for small offences. We see multi millionaire frauds going unpunished.

We see no top down direction of intellectual property thefts, this mortgage crisis, the loss of manufacturing jobs.

You call very large companies “small” if privately owned and give them enormous tax breaks. Why?

We see elected “sheriffs” supposedly determining the law to enforce.

It really hurts to see our best friend in such a state.

Bank hidden inventories sounds like they knew what could happen. Do you not have a registry office where all mortgages for each county are registered with the original filed there?

We look and talk like you; we have a multicultural law abiding society; our population contains a high percentage of university graduates - and our hockey teams beat you guys ! And I think our economy will soon be like yours - even with our free health care, abundant energy supplies, and mounties !

Please get your house back in order soon. You are always welcome up here in Canada.

http://www.moneynews.com/StreetTalk/Bernanke-Asset-Purchases-Risk/2010/10/26/id/374872?s=al&promo_code=B03F-1

70’s style inflation. oh crap!

How will stocks react to the midterm elections?

Up, and to the right! But of course!

Buy now, and compete with all-cash Wall Street investors who are “doing good” (God’s work?).

Number of Californians entering foreclosure rises 19% in third quarter

The jump from the previous quarter is the first time the measure has increased since early 2009, according to data from MDA DataQuick. However, the numbers are down from the same period last year.

By Alejandro Lazo, Los Angeles Times

October 27, 2010

Fresh data shows the number of California homes entering foreclosure jumped nearly 19% in the third quarter from the previous quarter, the first time the Golden State has logged an increase in the key measure since hitting a peak early last year.

It is too soon to tell whether the increase represents a further deterioration in homeowners’ ability to pay their mortgages or just improved efficiency on the part of lenders, analysts said. Big banks were overwhelmed in 2009 by the sheer number of delinquent borrowers and efforts to work with troubled homeowners, and the lenders could be playing catch-up, analysts said.
…
Of all the California homes that made it all the way through the foreclosure process during a two-year period ended in June, 80% had been resold by the end of the third quarter, according to DataQuick, indicating that a healthy demand for foreclosed properties exists.

Foreclosures accounted for 35.5% of the Golden State’s resale market in the third quarter, down from 35% the previous quarter and 42.7% in the year-earlier quarter. A healthy chunk of demand for foreclosed homes is coming from investors. At formal foreclosure auctions statewide last quarter, 22.7% of foreclosed homes were bought by investors, DataQuick said.

“There is still a lot of investor money out there,” said Leo Nordine, a Los Angeles real estate agent who sells foreclosure properties on the behalf of several major lenders. “It’s a funny economy: The regular people seem totally broke, but there is a lot of investor cash out there.”

He said banks were trying to sell foreclosed properties to people who will actually live in them. Bank of America and Wells Fargo, as well as mortgage titans Fannie Mae and Freddie Mac, have instituted policies that allow offers from people who will live in the homes to trump offers from investors, he said.

“There are too many investors and not enough real people,” Nordine said. “Wall Street is doing good, and it looks like that is where a lot of this money is coming from.“

I frankly have no idea how to evaluate the veracity of this kind of story.

Suggestions?

It Gets Worse: Meg Whitman’s Sons’ Racism and Entitlement Were Stuff of Legend

Meg Whitman’s sons, Griff and Will Harsh, have been kicked out of prep schools, an eating club, dormitories, and Princeton’s class of 2008, say people who know them. One incident involving the n-word is already internet famous.

Yesterday we documented big brother Griff’s beer-throwing and sheltered ways. Today, a glimpse at Will Harsh’s little brother blues—and how he compensated with white entitlement, according to a tipster/commenter and classmate:

Griff’s non-refundable membership to Cottage [eating club] was paid in full when he got suspended. So some of the officers would let Will attend some meals and formals events in his brother’s place until Will got banned from there.

The story goes that Will yelled “what are all these n!ggers doing here” one night when all the members of the Black Arts Company where there to celebrate a show they had performed. Cottage is know as one of the whiter clubs on campus so I assume that he was shocked to see so many black people there in a night. He was already on notice with Cottage officers because of an altercation he started with a bouncer early in the year.

This account varies from Guest of a Guest’s version, which has Will hurling the n-word at a specific person. Unless, of course, there was more than one epithet-related ban?
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I would like to propose a thought . What if the MBS security makers
didn’t comply with the law in the making of the securities in the first place
and none of these MBS loan bundles were lawfully passed to the investors
because of the complex nature of the real estate chain of title on liens .

What if its not just a snag in paperwork but a greater problem of not complying with the laws to begin with in the formation of these
securities . Maybe securities were complying when it came to unsecured
debt ,but not complying when it came to secured debt/loans with rights of foreclosure . Did Wall Street create a Ponzi-scheme in securities that
didn’t even comply with the law and it was so complicated but in the final
analysis voidable because it didn’t comply with long standing real estate
laws and ownership laws and chain of title laws ? It seems like a lot of cover-ups have been going on and a extra ordinary desire to change the paper-work on these loans or transfer them to other entities so the paper-work can be changed .

Joey , I was just listening to the Dylan Ratigan Show . Dylan had Professor William Black on the show . He was saying in essence that 49 % of the loans were fraudulent and 85% of Countrywide loans were fraudulent and of course he went on about the incorrect marketing of securities . William Black also addressed the situation of the Fed Chairman taking these fraudulent loans from the Banks without even checking the junk ,but now
he is talking about examining it years after he accepted it . William Black
in essence said they all need to be fired and he goes on to say that the
entire market was fraudulent and thats the only way you can describe it .

As you know massive fraud has been my theme song for years on this blog and I
have always felt there were more effective ways to resolve the matter than giving the culprits the money ,keeping the fraudulent system alive and covering up the crimes so Justice could not prevail .

You can’t have corruption ,fraud ,and Ponzi-schemes being the hub of our economy because it spells disaster . You can purge the system that produced the biggest crime spree in history .

People on this blog like to BS that this Wall Street Ponzi-scheme was all legal ,but thats is BS . The idea that we should just move on and you can’t put the toothpaste back in the jar is not the normal way crimes are handled in a rule of law Country .This was a cover-up from day one .

The Politicians are so bought off now that it’s a joke going to the voting booths and yes the Politicians are going right along with the cover-up and
the bailing out of the culprits who are their benefactors . Until this mess
slaps you directly in the face Joey you will continue to poo poo the
necessary solutions .