Bits Bucket for December 28, 2010
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
December 28, 2010
318 Comments »
Trackback responses to this post
- The Housing Bubble Blog
- The Housing Bubble Blog
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
April 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
“Everybody is looking for a boogeyman. What is being forgotten is that you are talking about people who didn’t make their mortgage payment.”
Problems with foreclosure notices loom as next flaw in process
By Kimberly Miller Palm Beach Post Staff Writer
Posted: 5:57 p.m. Monday, Dec. 27, 2010
Improperly served foreclosure notices may be the mortgage industry’s next roadblock to repossessing homes.
The Florida attorney general’s office is investigating two of the state’s largest companies that serve court summonses on homeowners, while at the same time judges are throwing out rulings based on faulty deliveries.
This month, appeals courts in Miami and Palm Beach County sided with homeowners in foreclosures where judges agreed their summonses were not appropriately served.
In the Miami case, the homeowner said she was recovering at her mother’s home after surgery when the person serving her the summons swore he personally handed it to her at her residence.
But the server’s own notes on the file showed he left the documents at the door after seeing curtains move and assuming someone was home. The homeowner later said she had no knowledge of the foreclosure until a final judgment was entered against her.
“Curtains may move because of the wind or curious cats, and not just because some prospective defendant is attempting to avoid service,” the appeals decision noted.
Once entrusted only to sheriff’s deputies, summonses may now legally be handled by “special process servers” certified by the court. With the crush of foreclosures statewide, process service has become big business.
But foreclosure defense attorneys say the service is often sloppy.
They relate cases where servers claim to personally serve clients at addresses that are post office boxes, hand papers to children but swear they served their parents, and fill out forms so illegibly it’s impossible to know who actually served the summons.
Because so many foreclosures are uncontested — about 80 percent in Palm Beach County — shoddy summons delivery can go unnoticed. Defense attorneys argue there’s no excuse for failing to fulfill due process, and, in the end, a mistake in service of process could force a case back to the beginning.
“The entire system is set up to be exploited, and I don’t think there’s nearly enough checks and supervision to ensure the process has not been grossly abused,” said St. Petersburg defense attorney Matt Weidner.
There is no statewide licensing or regulating body for process servers.
An attorney for one of the firms under investigation, Miami-based Gissen & Zawyer Process Service Inc., said the company plans to cooperate with the attorney general, which launched its inquiry Dec. 10. He acknowledged that in the tens of thousands of summonses served, there have likely been mistakes.
“But I would suggest there is no proof of widespread fraud to take advantage of people,” said Alan Rosenthal, an attorney with Carlton Fields. “Everybody is looking for a boogeyman. What is being forgotten is that you are talking about people who didn’t make their mortgage payment.”
There is a problem when ordinary people start manipulating the law the way the rich and powerful do. Like many systems in our society, it only works if the number of people who can abuse it is limited.
The bigger problem is that there is one system of “justice” for the elites, and another very different set of rules for ordinary people. Corruption in high places and crony capitalism breeds contempt. As the ancient Greeks used to say, the fish rots from the head first.
Why is it an abuse for people to have to receive “actual notice” before their house is forclosed on? Actual notice is a legal term for when the person actually receives a specific item of information (usually in written form) rather than something being done that would most likely result in the person receiving it. It is a very common requirement in real estate law. An actual notice issue was raised in one of the essay questions on my MA bar exam, though that related to contractual right of first refusal.
If the banks were willing to spend a few extra bucks (it takes longer to do actualy notice properly) and told their servers that there would be substantial penalties if there was a defect in any of the notices they claimed to have served properly, the entire issue could have been avoided. This happened because the banks chose profit over following the law. There is no reason at all for a person who is required to receive notification and doesn’t not to raise the issue in court.
polly, something I’ve wondered for a long time regarding “actual notice”: are there any legal options to serve it if the person truly cannot be located in order to be served? For example, what if someone has totally dropped off the grid and is living under a bridge somewhere?
This is not a problem, as we have a prison system to deal with ordinary people who “manipulate” the law.
The problem is that some members of the political-financial elite apparently operate above any rule of law.
Everyone is equal under the law, but that’s not much good if the the laws are not equal for everyone.
It especially helps if you have the only infrastructure in town. Then you can raid your own infrastructure because you know you’ll be bailed out, because you have the only infrastructure in town. Exhibit A: TARP.
That’s not true sometimes they have to pay fines of 1 to 2% of what they’ve stolen. Then they have to not admit guilt. How would you feel after such rough treatment?
“Everybody is looking for a boogeyman.”
Some times, the boogeyman is a bank. Luckily for bankers, they operate above the rule of law, as breaking and entering is punishable for ordinary (non-banker) citizens by prison time.
Banks accused of illegally breaking into homes
By Andrew Martin
New York Times
Posted: 12/23/2010 05:36:36 PM PST
Updated: 12/26/2010 04:19:58 AM PST
TRUCKEE — When Mimi Ash arrived at her mountain chalet here for a weekend ski trip, she discovered that someone had broken into the home and changed the locks.
When she finally got into the house, it was empty. All of her possessions were gone: furniture, her son’s ski medals, winter clothes and family photos. Also missing was a wooden box, its top inscribed with the words “Together Forever,” that contained the ashes of her late husband, Robert.
The culprit, Ash soon learned, was not a burglar but her bank. According to a federal lawsuit filed in October by Ash, Bank of America had wrongfully foreclosed on her house and thrown out her belongings, without alerting Ash beforehand.
In an era when millions of homes have been foreclosed on nationwide, more and more lawsuits detailing bank break-ins like the one at Ash’s house have surfaced. And in the wake of the scandal involving shoddy, sometimes illegal paperwork that has buffeted the nation’s biggest banks in recent months, critics argue that these situations serve to reinforce their contentions that the foreclosure process is fundamentally flawed.
“Every day, smaller wrongs happen to people trying to save their homes: being charged the wrong amount of money, being wrongly denied a loan modification, being asked to hand over documents four or five times,” said Ira Rheingold, executive director of the National Association of Consumer Advocates.
…
When Mimi Ash arrived at her mountain chalet here for a weekend ski trip ??
Going on a weekend ski trip to the house she makes no payments on…..Cry me a river…I smell a rat and its not BofA…I would wager she did a “I dare you”….
Florida mortgages more than 300 days delinquent before referred for foreclosure
by Kim Miller
A Lender Processing Services report released today shows that Florida, California, Maryland and Massachusetts are the nation’s slowest states in referring delinquent homeowners for foreclosure.
In Florida, an average of 307 days pass before a home is referred. In California, mortgage payments are on average 367 days delinquent before they are referred for foreclosure.
The good news in the November Mortgage Monitor report is that the volume of loans moving to REO continued to drop, something LPS attributes to this fall’s foreclosure moratorium issued by some banks.
Nearly 2.2 million loans nationwide are 90 days or more delinquent but not yet in forelcosure.
From the report:
Foreclosure inventories also continued to rise for the fifth straight month as delinquent accounts are referred for foreclosure, but the sale of foreclosure properties continued to decline. When compared to January 2008 levels, the foreclosure inventory of Jumbo Prime loans is nearly seven times higher; the inventory of Agency Prime loans is nearly six times higher; and the foreclosure inventory of Option ARM loans is approaching five times the inventory in January 2008.
Only 300 days? They should at least give 99 weeks, its only fair.
Meanwhile, renters have a court order pasted on the door if the rent payment is 10 days late.
I had an apartment neighbor that had his door locks changed after 14 days.
Does anyone have any data regarding whether or not the former scarlet A of Foreclosure is preventing anyone from acquiring rental housing.
Does anyone have any data regarding whether or not the former scarlet A of Foreclosure is preventing anyone from acquiring rental housing.
Renting After Foreclosure
http://hubpages.com/hub/RentingAfterForeclosure
Losing the home due to foreclosure will always be very difficult emotionally.But instead of worrying about your lost home,it is better to look for the future plans.One thing you would definitely need to think about is renting after foreclosure.
It will be hard to get the home after consoling the landlord and letting them know that you are indeed capable of paying the rent without fail.But there are solutions to such people to get the rental house easily.Here are some solutions :
how can i rent a house after foreclosure??
=>pay an extra 2-3 months rent up-front,
=>You can also offer an extra amount as a security deposit to the landlord.
How to Find an Apartment After Foreclosure
http://credit.about.com/od/toughcreditissues/qt/rentforeclosure.htm
Home Prices Probably Fell, Baring Weak Link in Accelerating U.S. Recovery
By Bob Willis - Dec 26, 2010 12:01 AM ET
Home prices probably dropped in October, a sign housing will remain a weak link as the U.S. recovery accelerates into the new year, economists said before reports this week.
Property values in 20 cities were down 0.2 percent from October 2009, the first year-over-year decline since January, according to the median forecast of 14 economists surveyed by Bloomberg News ahead of a report from S&P/Case-Shiller in two days. Other data the same day may show consumer confidence rose to a seven-month high in December.
A wave of foreclosures waiting to reach the market means home prices will remain under pressure in 2011, representing a risk to household finances. Rising equity values and an improving job market will probably help offset the damage, ensuring that confidence and spending continue to climb.
“The inventory overhang is so big, with foreclosures looming, it’ll take five years to absorb the supply,” said Paul Ballew, chief economist at Nationwide Mutual Insurance Co. in Columbus, Ohio. “The consumer is feeling better although there is still a high level of caution and anxiety.”
http://www.bloomberg.com/news/2010-12-26/home-prices-probably-fell-baring-weak-link-in-accelerating-u-s-recovery.html - 59k
“Accelerating US Recovery”
Should be “Accelerating Propaganda Recovey”.
Exactly.
ANY article that has the word “probably” in it, is opinion, not news.
It’s too damn cold outside! Brrrrrrrrr.
I live in S. FL, and just placed an order for window insulation film (the stuff you heat shrink in). That should tell you something!
Where’s the global warming when you need it? We’ve had record lows in S. FL now a few times already this year. Crops are dying, and it’s just bloody cold and miserable. I realize it’s much worse up north, but, at least they are ready for it. We don’t even have a furnace; we just have electric resistance heat (like most S. FL homes), which isn’t very effective, and costs a fortune to run.
Ugh.. Please, please, let the warm come back!
It tells me something just that you have to special order window film. Even in the DC area you can find it in every Wal-mart and Target.
Out of curiousity, I just looked. I see it on both Target and Wal-Mart’s website, but not in stock in any of the stores near me. Seems that there’s not a ton of demand for it down here!
Yep, and you’d have to special order a snow blower from the local Lowe’s or Home Despot if you’re in S. Florida.
C’mon, you get a 3- to 5-day cold snap a couple of times each winter. BFD! It’s time to man up.
My Avocado, Lychee and Mango trees took some damage and it is only December. I cover them in mulch and huge plastic bags. That global warming thing seems to have stalled badly. We’re on track to the coldest December on record (till 1896 or so).
Mike,
I’m sure you’ve got the same problem I do, these houses just aren’t built for this kind of cold. Not many people here even have heat pumps, it’s just electric resistance heat, and, although it works, it’s an incredibly expensive way to keep yourself warm..
Don’t heat pumps work the same way?
Steve,
No, not at all. Electric resistance uses electricity to make heat (think of something like a big hairdryer, that’s effectively what it is). The advantage is that it’s CHEAP; much like a hair dryer, not a whole lot of sophistication.
Heat pump works like an air conditioner in reverse, instead of bringing the heat out of the house, it brings the heat in. This is dramatically more efficient than electric resistance, but its also much more sophisticated and can be significantly more expensive. Most places that have moderate temperatures (think North Florida to ~NY area) that need heat and AC will use heat pumps. If you’re using the heat pump for ~1/2 the year, it makes good financial sense very quickly. If you live in a REALLY cold climate (think upstate NY and north) they won’t really work for you (not enough heat to transfer).
So, for much of the “temperate” band, heat pumps are great. And they would be great in S. FL too, just that almost nobody buys them because we typically have 5-10 “heat days” a year, it’s not that common that we need it; and, as such, it will never pay for itself.
Except.. That I’ve had on my heat for >10 days ALREADY this year. So much for “temperate” bands, huh?
Heat pumps, FYI, are typically 2-4X the efficiency of electric resistance heat. If it takes 1 watt to heat a house by 1 degree using resistance, a heat pump with the same power input will typically raise the temperature by 2 to 4 degrees.
Heat pumps generally have a 25 degree max
temperature potential. If it’s 30 degrees outside than the max you can warm up is 55,
then resistance heaters come on to bring it
up to the desired temp. This is true regardless of the heat sump, air or buried
heat exchanger.
One more point. In hot, dry climates, a mister
evaporator on top of your air conditioner or heat pump can dramatically lower indoor temps during a heat wave.
We set one at the lowest flow rate possible without it going off and the temps drop 10 degrees in minutes.
Cool Rancher…I have never heard of that application before but it makes complete sense…We use our mister when we are under the Motor Home awning and it reduces ambient by 15 degrees at least….
There’s actually a company that makes an “auto on” system for this that’s pretty neat. Basically, it straps to your AC unit, and when the AC kicks on, it starts misting (it works because of the movement of the fans). Pretty neat idea. I don’t have one, but, if I lived somewhere that had something <100% humidity in the summer, I’d probably get it and test it out.
I don’t think that technology is at all effective in FL, but AZ/NM/etc? It would seem to be a no-brainer in places that would have high evaporation.
Doesn’t use much water either (from the marketing material)..
Doesn’t use much water either (from the marketing material).. ??
Link or Name… ??
This is no way an endorsement of the product, I don’t have one. But the concept really does look sound.
http://www.coolnsave.com/
I tried to post a link (hopefully it will show up). If not, it’s called “Cool-N-Save”. I don’t have one, and obviously, as such, can’t speak to it’s effectiveness. But the idea is sound, it should work very well in hot/dry climates.
“Where’s the global warming when you need it?”
We seem to have got it in my neck of the woods, it has been unusually mild and dry so far. Still no snow in my burg, or rain for that matter.
Are the pine beetles under control yet? I heard you needed an extended cold spell to keep them in check. It was sad to see so many 1000s of acres of dead trees last time I was there. I am assuming you live east of the tunnel, as I heard there were several major snow storms in the mountains.
Not anywhere near as cold as it used to be, control pests like that.
It’s not heat, it’s drought that allows the bugs to get beneath the bark into the Cambrium layer. The trees don’t have enough moisture
to keep their sap running and thick enough.
The global warming part if affecting the Arctic regions, not the continental U.S. and Europe. There’s been a strongly negative North Atlantic Oscillation (NAO) and Arctic Oscillation (AO)… which means the oscillations were reversed with the Arctic being warmer and the U.S. and Europe getting the Arctic cold.
Thanks howie. You’ve nailed it.
I’ve been trying to explain the basic effects of disturbing the equilibrium of dynamic systems, but those seem to be big words for most people.
10 year drought in Texas.
When I moved here 30 some odd years ago, it rained every almost day in the summers and was cold by Nov.
This year, the leaves JUST started dropping last week.
Don’t panic. The warm is back tomorrow. The weather phenonemon that created the cold is breaking down and is being replaced with a more normal one. It will be warm in Florida again for awhile.
Supposed to be in the lower 40s here tomorrow. Lower 40s looks like a heatwave compared to what the temp. has been!
Youngstown Journal
Trying to Overcome the Stubborn Blight of Vacancies
By SABRINA TAVERNISE
Published: December 19, 2010
YOUNGSTOWN, Ohio — In its heyday in the 1930s, this Rust Belt town called itself the City of Homes, a place where a working-class man could be master of his own castle.
Youngstown’s troubles all started with a sharp economic decline after the closing of steel mills in the 1970s, which has reduced the city’s population by 60 percent, to 72,000, over several decades. Vacant buildings brought blight, and depressed property values, but for years, officials hoped the problem would just go away.
A fresh chance came in 2000, when an energetic former banker for the Federal Reserve in Cleveland, Jay Williams, became the city’s community development director, and five years later, its mayor. He soon unveiled Youngstown 2010, a blueprint that called for shrinking the city, something no one had dared speak about in the past.
So demolitions became the main policy, more expensive (and legal) than arson, and still a blunt tool. During Mr. Williams’s tenure, more than 2,000 vacant houses have been knocked down, but thousands more remain.
According to the Mahoning Valley Organizing Collaborative, a nonprofit organization that encourages public participation in housing issues, there are 5,249 vacant structures in the city. Together with the approximately 20,000 vacant lots, that makes about 40 percent of the city vacant in some form, according to the group.
As a result, houses have been cheap, and when the frenzy of buying began in the recent housing bubble, that was blood in the water. The average price of a house for the city, based on the past year of sales, is about $17,000, and on the poorer east side, under $10,000.
“People would call and ask, ‘Should there be another zero on this?”’ said Maureen O’Neil, a real estate agent who also works for the city.
Real estate agents got calls from buyers steeped in late-night infomercials, who had bought a Youngstown house on eBay. Sherry A. DeMar, an agent in a suburb of Youngstown, said she went to look at a house for a buyer in California who had made the purchase based on a photograph he saw on the Internet.
“I told him, ‘Do you realize the roof has caved in?”’ she recalled. “He didn’t believe me. He said, ‘It looked great in the photograph.’ ”
New foreclosures began to infect areas that had long been immune, compounding misery for residents and headaches for city planners. Now, about a fifth of vacant structures in Youngstown are owned by out-of-state residents, Mr. Bralich said. Thirty-six percent of the new owners are from California.
http://www.nytimes.com/2010/12/20/us/20youngstown.html -
At least the number of city employees reflects reality:
Code enforcement was difficult because the city’s planning department, which employed 28 people in the 1970s, had dwindled to 3, including the secretary
CA specuvestors left no area untouched.
“Real estate agents got calls from buyers steeped in late-night infomercials, who had bought a Youngstown house on eBay. Sherry A. DeMar, an agent in a suburb of Youngstown, said she went to look at a house for a buyer in California who had made the purchase based on a photograph he saw on the Internet. “
DEAR GOD!
““I told him, ‘Do you realize the roof has caved in?”’ she recalled. “He didn’t believe me. He said, ‘It looked great in the photograph.’ ” ”
OMG. Fools like this and their money _should_ be parted.
Better off with the mark
Spiegel
Unnerved by shaky, debt-ridden countries and bailout packages worth billions, the majority of Germans want the mark back. In a survey conducted in early December by the polling firm Infratest dimap, 57 percent of respondents agreed with the statement that Germany would have been better off keeping the mark than introducing the euro. Germans, it seems, are gripped once again by their historic fear of inflation: According to the Forschungsgruppe Wahlen polling institute, 82 percent of the population is worried about the stability of their currency.
Now, a network of euro critics is capitalizing on this atmosphere.
“The return of the mark? I can imagine that we could see the rise of a German Tea Party focusing on precisely this issue,” says Thomas Mayer, chief economist at Deutsche Bank, referring to the conservative American political movement.
“I can imagine that we could see the rise of a German Tea Party focusing on precisely this issue,” says Thomas Mayer, chief economist at Deutsche Bank”
Ooooh, aha, ahahaha! Aren’t WE all cheeky and tickety-boo, Mr. Mayer, chief eCONomist at Douchebag.
Say, Mr. Mayer, how’d you like those TARP funds from the US? Thank US for still having an idiot’s gig at Douchebag.
Such language….I shall report you to Der Angriff!
I know, but I’m pissed. Nothing gets my blood boiling like a global elitist making fun of “der people”. I don’t blame Germany, it carries the EU on its back.
And Deutsche Bank would have been buried in that AIG debacle, if memory serves.
I’ve been sorting out a relative’s stamp collection. Found a boatload of those German inflation stamps. Whew! 500 million marks. Now THERE was a moment.
The sad truth is that there’s no party that even supports the exit from the EURO except the extreme right (Nazis). Nothing has the people in Germany as pissed off as having to pay for everybody else’s spending habit, especially since real wages in Germany declined 6% since the introduction of the Euro.
What happend was that Germany had an export surplus similar to China or Japan. Instead of paying higher wages to their worker bees or buying commodities, the elites decided it would be good to enter the global casino. So they fueled various real estate bubbles, mainly in Spain and Ireland, but also in the US. Now it turns out that this wasn’t such a swell investment after all. Greece and Italy don’t suffer as much from real estate bubble as from Enron style accounting. Now the German taxpayer is supposed to bailout everything and everybody. While workers in the PIIGS countries can retire at around 60 Germany is raising it to 67. That doesn’t go over well with the people….let ‘em eat cake!
Social Security allows widows to retire at age 60. I have not heard anyone suggest changing that.
There are plenty of marks in the US, although realtors prefer to call them “clients”.
Deutschmark, Deutschmark über Euros,
Über Euros in der Welt
No doubt this is to be sung to the tune from the slow movement of Joseph Haydn’s Kaiser Streichquartett?
Excellent, Dennis.
One in Four Borrowers Is Underwater
By RUTH SIMON and JAMES R. HAGERTY
The proportion of U.S. homeowners who owe more on their mortgages than the properties are worth has swelled to about 23%, threatening prospects for a sustained housing recovery.
Nearly 10.7 million households had negative equity in their homes in the third quarter, according to First American CoreLogic, a real-estate information company based in Santa Ana, Calif.
Home prices have fallen so far that 5.3 million U.S. households are tied to mortgages that are at least 20% higher than their home’s value, the First American report said
Homeowners in Nevada, Arizona, Florida and California are more likely to be deeply under water, according to the analysis. In Nevada, for example, nearly 30% of borrowers owe 50% or more on their mortgage than their home is worth, said First American.
About 7.5 million households were 30 days or more behind on their mortgage payments or in foreclosure at the end of September, according to the Mortgage Bankers Association. Many of those homes will be lost to foreclosure, adding to the supply of homes for sale.
Most U.S. homeowners still have some equity, and nearly 24 million owner-occupied homes don’t have any mortgage, according to the Census Bureau.
Nice links today Jethro. It looks like 2011 is going to be another dose of reality for the Housing Crime Syndicate and it’s adherents.
One in Four Borrowers Is Underwater
And I just read 1 in 3 have no money whatsoever in a retirement account. And “From 1950 to 1989 top 1 percent earned roughly 7 to 8 percent of nationwide income.” Today it is inching closer to 25 percent resembling pre-Great Depression levels.
Middle-class money has been redistributed to the rich by the redistributers of wealth. The coddled rich now feel entitled to more and demand more socialism for the rich while demanding that the middle-class face raw and brutal corrupt, monopolistic, rigged crony-capitalism and austerity.
The above are facts, not AM radio, fraudulent, soundbite slogans of misdirection.
“Middle-class money has been redistributed to the rich by the redistributers of wealth.”
In most cases in the U.S. he redistributers of the middle-class’s wealth was done BY the middle class, not done TO the middle-class.
Something to do with millions of middle-class people believing they can borrow and spend their way to prosperity forever.
In most cases in the U.S. he redistributers of the middle-class’s wealth was done BY the middle class, not done TO the middle-class.
I very much disagree.
It was done TO the middle-class via outsourcing, stagnant wages, eliminated jobs, cut benefits, full-time jobs changing to part time, W-2s changing to 1099’s, predatory lending, constant materialism propaganda etc.
The above factors have redistributed wealth FROM the poor and middle-class TO the rich.
The above factors weigh much more heavily than American’s average 8K in Credit Card Debt and 18K average debt per household. figures source MSN.com
A family with a good job can support the debt figures above but a family without jobs can’t support anything.
It was done by middle-class folks cashing out their home equity and going on a spending binge. It was done by retired folks turning their paid-for houses into ATMs. It was done by working people who retired because they had a birthday - not because they could no longer work - and turning over to a stranger all their cashed-out pension money and all their 401k money because they believed they would receive ten to twelve percent returns on this money for the rest of their lives.
“… constant materialism propaganda …”
It was the consumers CHOICE to believe in the propaganda or not to believe in the propaganda. A lot of people did not buy into the propaganda; these are the people who still have their wealth.
“A lot of people did not buy into the propaganda; these are the people who still have their mental health.”
It was done by middle-class folks cashing out their home equity and going on a spending binge. It was done by retired folks turning their paid-for houses into ATMs.
I’m glad you brought that up but this whole “equity extraction” leading to America’s decline thing is overblown. Let’s look at the numbers Oxide distilled from today’s Wall Street Journal Article.
Out of 102 million US households 90 million have houses with equity or are that are paid off or that are rented. That’s about 90% of the households. And remember some of those 10% of households that are underwater have never even extracted equity.
From those figures we can assume maybe 80-90% of American households did not abuse home equity lines of credit therefore that equity extraction cannot be a major reason for American middle-class decline.
..it was done by working people who retired because they had a birthday - not because they could no longer work - and turning over to a stranger all their cashed-out pension money and all their 401k money
But most Americans don’t even have pensions anymore or very much money in their retirement accounts.
This helps proves my point that wealth was redistributed FROM the poor and middle-class TO the rich via outsourcing, stagnant wages, eliminated jobs, cut benefits, full-time jobs changing to part time, W-2s changing to 1099’s, predatory lending, constant materialism propaganda etc.
The average family’s 18K in total non-mortgage debt and only maybe 10-20% of Americans taking on excessive home equity debt are not nearly as big of factors in America’s decline as the list of items I mentioned above.
First they cancelled the pensions, then they cancelled the matching 401k.
I was talking to a friend the other day and he said that without the foreign multinationals like BMW, Siemens, Hyundai, Toyota and so on, the unemployment situation in this country would be in depression level (although we are already there if you count the underemployed).
Funny how the world works…………
First they cancelled the pensions, then they cancelled the matching 401k.
It’s coming. My company canceled Pensions in 2010. Next year it’s going to “Home Internet Access Allowance” and Blackberries. Hope my team doesn’t get impacted with internet allowance. Depending on projects, we pull all-nighters periodically. Everybody prefers to work from home in days/weekends like that. Blackberry, I could care less.
LOL! That’s what they did at HP
1) They stopped contibuting to pensions
2) They cancelled profit sharing and switched to a “Performance Bonus Plan” where the performance goals are a “trade secret” even though HP publicly provides its financial goals for the year to Wall St.
3) The Performance Bonus Plan was narrowed so only the top 40% of employess get a bonus.
4) 401K matches were made contingent on making the secret “Performance Bonus Plan” numbers.
5) Two years ago everyone had their pay cut 5%.
6) Only top performers get any kind of pay raise, and sometimes not even that.
And this is a company that is on the road to making 10 billion dollars profit the next fiscal year.
I work from home on a regular basis, and my company doesn’t pay for my internet access. That’s a perk!
They cancelled pensions a long time ago, but luckily I was in the group that still gets one. Whatever, I consider it to be worthless, because I’m sure the next big downturn they will completely get rid of that thing.
They still match on the 401k though, so good for that.
True there are many fools and greedy middle class people, but there are also many prudent conservative people in the middle class that have been fleeced.
1. Trade policy
2. Tax policy
3. Regulation of wall street
4. Propaganda eminating from corporatist think tanks through the corporate owned media designed to fool people into giving away their money.
5. Interest rates approaching 0%
Now we are back to that propaganda word again. One can choose to believe in the propaganda presented to him or he can choose to do some research on his own - can choose to do some THINKING on his own - and reach his own conclusions as to what is or is not in his best interests.
This is the information age; It is not as if there is no information available for whomever bothers to take a look.
Now we are back to that propaganda word again. One can choose to believe in the propaganda presented to him or he can choose to do some research on his own -
You are correct theoretically but not much practically because it’s been proven that propaganda works. Will it work on everyone? No.
Will it work on enough people for corporations to spend billions in cash on it every year? Obviously the answer is yes because cash is king no?
Therefore materialism propaganda is an important driver of consumer’s choice of going into debt whether it “should be” or not.
Propaganda works because there are millions of people who buy into it, just as you said. But there are many people who do not buy into the propaganda, also just as you said. So the issue isn’t the presence of the propaganda, the issue is whether one chooses to buy into the propaganda that is presented to him.
Those who allow others to do their thinking for them are subjecting themselves to acting in the best interests of others and are the ones who ending up willingly sending their wealth to somebody else. Those who do their own thinking are the ones who keep their wealth for themselves.
So the issue isn’t the presence of the propaganda, the issue is whether one chooses to buy into the propaganda that is presented to him.
That is an issue however IMO the overriding issue in practice is that materialism propaganda is an important driver of consumer debt whether it “should be” or not.
The proof being that it works.
A lot of people have never heard the name Edward Bernays, or know of him as the Father of Public Relations. As with most of his “Engineering Of Consent” genius “inventions” was the “Think Tank”, which he created to mask the intent of the corporate agenda behind it. As I say, he was evil genius. (And Sigmund Freud’s Nephew)
So you believe that those not blessed with your intellect and knowledge should be fleeced? Sounds a lot like Wall Street.
You haven’t addressed trade and tax policy and ZIRP TARP and other bailouts as playing a major roll in the fleecing of the middle class. The majority of Americans were against TARP it passed anyway. The money was stolen not given away.
Everyone is gambling at this point because markets are not based on fundamentals but rather on FED intervention and manipulation. This goes for cash as well. You make the case for deflation. The FED could send every tax payer a check for 100,000 dollars that might blow your deflation theory into the dust. The elite get to trade on that info before the rest of us. Congress trades on this info before the rest of us.
One doesn’t have to know of Edward Bernays to know if he can afford to buy something or not. He doesn’t really have to know much of anything to know if he can buy something or not. All he needs to know is can he afford to buy it or not.
A lot of people who have convinced themselves that they know a lot have demonstrated that they really know very little, or know very little where it counts the most.
Deep down, degreed or not, many Americans are really just plain stupid.
Who here wants to take a deep look into the prospect of millions of people not getting all the retirement benefits that have been promised to them and what effects on the economy this will have? Are there many here that do not see this as a problem?
What we are about to see as a response to this post is a bunch of words describing how hyperinflation is about to descend upon us all and destroy the purchasing power of the dollar.
Stay tuned …
“So you believe that those not blessed with your intellect and knowledge should be fleeced?”
I don’t believe anyone should be fleeced. But the decision to allow oneself to be fleeced or not lies with the individual, not with me.
One doesn’t have to know of Edward Bernays to know if he can afford to buy something or not. He doesn’t really have to know much of anything to know if he can buy something or not. All he needs to know is can he afford to buy it or not.
I’ve used sourced numbers and percentages today supporting my case that middle-class decline was not mainly or even substantially brought on by Americans buying too much stuff and/or the abuse of home equity but rather mainly caused by the dismantling of the American economic social contract which in turn has benefited the very rich. This has in fact redistributed wealth from the poor and middle-class to the very rich.
But let’s go back to 18K average non-mortgage debt per American household. Excessive? Maybe not because it is the average and not the median. It could be easily skewed by the few with very high incomes. In addition that debt could be for a combination of a needed car, some plumbing work, some college or “updating skills” And how much of that debt is actually medical debt?
Based on bankruptcy statistics which can be seen as a reflection of American’s debt components, I would assume a lot of it could be from medical debt. This also would bolster my position above.
http://www.bcsalliance.com/y_debt_medical.html
Most people think that most of those who file bankruptcy did so because they got way over their heads in credit card debt; however, research shows the truth is much more surprising. For the years 2003 and 2004, just over 50 percent of all personal bankruptcies were the result of medical debt by those with health insurance. A significant percentage of those listing medical debt as the reason for their bankruptcy are 65 and older.
“But the decision to allow oneself to be fleeced or not lies with the individual, not with me.”
What if you vote for Ron Paul, who dismantles the government protections along with the rest of the protections, and my job is outsourced? I’m hosed and fleeced whether I “allow” or “choose” it, or not.
“You haven’t addressed trade and tax policy and ZIRP TARP and other bailouts as playing a major roll in the fleecing of the middle class. The majority of Americans were against TARP it passed anyway. The money was stolen not given away.”
Yes, that is exactly what is killing the middle class other than ignorance and greed. Globalization, taking tax dollars from the next three generations and giving it to corrupt financial and government institutions, tax policies that directly contribute to companies moving offshore and artificially low interest rates punishing savers and eventually causing inflation.
We willingly vote for our own executioners as long as they keep passing out goodies.
If the choice of getting fleeced or not getting is not presented to the fleecie then the fleeced gets fleeced regardless. But I am not talking about this mode of fleecing, I’m talking about the fleecing whereby the fleecie WILLINGLY subjects himself to the fleecing.
MILLIONS of jobs were sent offshore, never to return.
MILLIONS more had their wages cut.
I have never seen across the board deflation in my life. I’m over 50. The cost of living has always gone up.
But wages have gone down.
And the population has kept increasing.
Corporations were given more power and less accountability.
This has been ongoing since the 1980s.
Are you seriously going to tell us that the avg person had control over those factors?
Seriously?
“Are you seriously going to tell us that the avg person had control over those factors?”
No.
“I have never seen across the board deflation in my life.”
Neither have I.
MILLIONS of jobs were sent offshore, never to return.”
I bet you’ve never seen this in your lifetime before either.
“MILLIONS more had their wages cut.”
Or this either. Which makes things different now that things have ever been in our lifetimes, no?
“Propaganda works because there are millions of people who buy into it”
The problem is that even if you don’t buy into the propaganda, you can still be hurt by the millions that do. Politicians use negative campaign ads because they work. Many have lost jobs due to the bursting of the bubble who did not buy into it.
This is very true. The economic environment is established by all the players. And if one if tuned into how distorted the economic environment has become then he can take action to dampen the effects once the environment begins to correct itself.
In my lifetime, there was still an increase in opportunity and standard living until the 1970s. In the 1980s, there was real clampdown on small time entrepreneurs (hot dog vendors, roadside repair mechanics, etc) while at the same time they were touting entrepreneurship as the road to riches.
My point is that it wasn’t just irresponsibility that hurt people. Most folks really were caught in forces beyond their control. But that doesn’t make for exciting and controversial news that distracts people from the real culprits, does, it?
“The economic environment is established by all the players. “
No. It’s established by who ever has the most money and connections.
Come on! Even you know the Golden Rule! “He who has the gold…”
Does anyone here believe Social Security will not be means tested or its disbursement will be cut back in some way?
Does anyone here believe that pensions will continue to be cut back?
Do people here believe that wage increases are imminent? That unemployment numbers will soon drop to below five percent?
No? Then one’s financial activities and plans should be tailored accordingly, no?
“My point is that it wasn’t just irresponsibility that hurt people.”
I never said it did. I did say that people hurt themselves by willingly doing crazy things that ended up sending what wealth they ha to somebody else.
Tens of millions of folks, for example, became convinced it was sound and prudent to take on as much debt as possible, that to not be maxed out on one’s equity was a sure sign of financial incompetence.
I agree with you Combo. We have free will. Collectivists such as Rio think we are all puppets controlled by the wealthy or elite.
I agree with you Combo. We have free will. Collectivists such as Rio think we are all puppets controlled by the wealthy or elite.
Of course you do Bill. What else could you offer?
It’s easier for you to agree bill because you have proven unable to say much.
20 words here and there and name calling. You don’t have much more.
Ever.
I mentioned Bernays because of the mass campaign to get people to serial refi, to induldge their wants, housing was always going to go up, and the don’t get left behind psychology. We all have free will, but “The Engineering Of Consent” is what’s needed to fuel a bubble. That’s all. You all responded with very sound posts. Thank you and Happy Healthy New Year to all. Everyday is mind food here, and I appreciate you all. XOXOXO
The problem is that even if you don’t buy into the propaganda, you can still be hurt by the millions that do.
“The women of this country learned long ago that those without swords can still die upon them.” — Lord of the Rings
Well it was a joint effort. By and to …
Thats the thing about the elite rich, they are never satisfied and keep taking until violence breaks out. We have a ways to go before its that bad, but we are well on our way.
For instance, I see no end to the state and municipal budget crises around the country, and that’s not even taking into account the coming pension train wreck. As the middle class continues to shrink and housing prices fall (both resulting in less taxes raised) we will see year after year, decade after decade of budget cuts and service reductions.
At the current pace in just a few more years there will be no more money available for State U’s in the Centennial State. Colorado State U is even considering privatizing as it will soon receive no funding at all from the state. It seems that every year they have to reduce the state budget and this has been going on for most of the decade here in Colorado.
So the middle class is faced with declining wages, crappy health insurance, skyrocketing education costs for their kids, etc. while the top 1% gets richer and richer.
And while I’m not advocating the Dems as a solution to the problem it was simply stunning that we gave the house back to the GOP, who just weeks before the election blocked the repeal of taxbreaks for offshoring. I guess I can look forward to Palin being elected President in 2012 and having taxes for the top 1% reduced to zero while flyover country finishes burning to the ground.
“…I guess I can look forward to Palin being elected President in 2012″
Oh goody a lead-in for Hwy’s first prediction for 2011:
Sarah the Baracuda-ess said: “blah, blah, blah & more blah…”
Sarah the Baracuda-ess said: “blah, blah, blah & more blah…”
Sarah the Baracuda-ess said: “blah, blah, blah & more blah…”
As she tours America as a CSA write-in candidate for the 2012 GOP CONvention.
Palin-Perry 2012
How about a national unity ticket of Obama-Palin?
All the crazies will be happy.
How about a national unity ticket of Obama-Palin?
All the crazies will be happy.
Maybe they’d be even happier with Palin-Biden
No, Obama-Palin sounds good to me.
It’s like ying-yang. A vacuous bimbo and a mimbo with some mannerism of an intellectual, you can’t do better than this.
Obama-Palin is an invitation for the nuts to implement the “Second Amendment Solution.” And yes, there are some tea partiers who used that actual phrase.
They weren’t talking about assassination. AFAIK they were talking about re-establishment of a constitutional republic.
I’m sorry Carl,
I like almost all your posts but I refuse to believe that somebody who uses words like “Second Amendment Solution” is thinking of a constitutional republic. That would be the “Article 1 Solution.”
Believe what you want. I have a high confidence that they were not talking about assassination, though, at least based on the people I know who use terms like “Second Amendment Solution”. Just another way to say “bullet box” versus “ballot box”, which the same people also like to talk about.
I see no end to the state and municipal budget crises around the country, and that’s not even taking into account the coming pension train wreck ??
What Colorado ?? You see no fairness in that our local police Chief just retired last week @ 52 with a pension of 90%, his last salary being $252,000….
Meanwhile, how many working stiffs were let go by the city to pay his pension.
In our burg only the cops and firefighters get pensions. All other muni employees get 401K type plans (403b?)
Today it is inching closer to 25 percent resembling pre-Great Depression levels ??
And some got Conveniently rewarded with no estate tax in the year 2010…If you are rich, and you are gonna die it was a banner year for your heirs…The heirs of George Steinbrenner, Thank You…
Finally, some actual numbers.
34.4 M homes with equity.
5.4 M 0-20% underwater.
5.3 M >20% underwater.
24 million are paid off.
—–
70.5 million occupied bought homes total.
70.5/.69 “ownership society” = 102 million households total.
31.6 million households rent.
Sounds about right…
So my aritmatic says thats ~15% of homeowners or ~10% being upside down. Because apparantly, people with no mortgages don’t count as homeowners…. /snark
Hey, Jim, in a few more years you won’t even be part of the statistics. Congratulations.
By the way, I want an invite to that mortgage burning party.
That should say “~15% of homeowners or ~10% of households being upside down.
“One in Four Borrowers Is Underwater”
…
“In Nevada, for example, nearly 30% of borrowers owe 50% or more on their mortgage than their home is worth, said First American.”
These statistics become ever-more amazing with the passage of time.
Well I came down to VA – DC and it if fairly warm as compare to Podunk Syracuse NY. We came to pickup some very high end office furniture as an investment firm that invested in real estate has gone bust. We bought 43 pieces and with the moving cost it will be about $8300. The cheapest piece on this collection is still being sold for about 2K new. Most pieces are 5K to 8K. Combo is correct Cash is king and an HBB reader slapped them with some cash. We have kept our powder dry and now we are firing. There are so many opportunities that sometimes I have to close my eyes to avoid looking at them.
I am sorry to say this but so far I love this bust. Peace
Firing?
Yes, but, who you gonna sell it to? Can’t imagine there’s much of a market for high end office furniture these days, even at a deep discount. Not to be a party pooper, but I’ve got a buddy in the stuff business who is still trying to unload some business furniture and fixtures, mostly in the salon & spa biz, though.
We will use the furniture ourselves. Last time we bought office furniture was about 20 years ago from Gold Dome bank in Syracuse that went belly-up.
I would think there’s a lot of used office furniture on the market right now. Do you intend to resell it or use it yourself?
My wife just furnished their 5 offices from a going out of business sale for about 1200. We did the moving. They are renting 1500 sq feet of good office space for 1200/mo. Low overhead is going to allow them to crush the competition.
Article the other day about concert tickets going for much less this year.
Flat Screen TV’s continue to drop.
Of note I’ve seen a huge uptick in office/store space for rent or sale over the last few months.
Yeah, the $20 convience fees, $40 parking, and $100 ticket prices finally hits home.
“Flat Screen TV’s continue to drop.”
As does the quality. There was a recent article that documemted how these expensive toys won’t last even 4 years on average.
And on that note, the $100+ DVD player we bought just 2 years ago gave up the ghost today. Its predecessor lasted 10 years.
Everything.Is.Junk.
Thank you China and all of you multinational companies that don’t make anything anymore.
Amazing! I have a 23 year old 13 inch color Sony that my son poured koolaid in that still works great.
Why do Tea-Party people run away from their far right-wing, Christian Conservative makeup? If that’s what they are why do they keep saying that’s not what they are? Is there an advantage to be perceived as not what they are?
The Tea Party’s religious roots exposed
http://www.guardian.co.uk/commentisfree/belief/2010/oct/12/tea-party-religious-right
The Tea Party is not a secular movement – as a new poll confirms, it is driven by the fervour of the religious right…
A new survey challenges the conventional wisdom that the Tea Party movement in the US is a secular libertarian movement and in fact demonstrates the religious zeal in its ranks.
These results confirm what I have found reporting on the intersection of the Tea Party and religious right: that the Tea Party movement is driven in no small measure by religious fervour, and that religious-right political elites have deliberately injected themselves into the movement, both as a matter of common cause and political expediency.
The conventional wisdom that the Tea Party movement is a secular one is rooted in its portrayal as a spontaneous uprising of disgruntled, ordinary citizens against “big government” and alleged “socialism”.
This should provide an obvious enough refutation to the purveyors of the theory that the Tea Party movement is disinterested in “social issues”
…But to understand why the Tea Party resonates with the religious right and vice versa, one must understand how the anti-government rhetoric of the Tea Party movement is driven by a fundamental tenet of Christian reconstructionism:
This notion that the federal government – not only godless, but in flagrant violation of God’s will – is “tyrannical” and needs to be overthrown resonates from militias to the John Birch Society to the podiums of religious-right gatherings where Republican presidential hopefuls jockey for the support of the faithful
Have no doubt in your mind….. there is nothing “Christian” about religion, the religious right and social “conservatives”. These are the antithesis of Christianity.
As a side note, I find it hilarious that those who claim to be righteous and hide behind a cloak of religiosity know so little about the old and new testaments.
Religion (any brand) is creepy.
If it were that “creepy” you wouldn’t be here defending your beloved GOP nutjobs every day.
They are hypocrites to the core….
“know so little about the old and new testaments”
Its funny how those “Bible Believing” churches gloss over how the Book of Acts chronicles early Christians living a “socialist” lifestyle, turning over their entire weath to the community so it can be shared.
Recently the wife of a local fundy Pastor I know died of cancer. Since they were unisnured she was never screened as they couldn’t afford mammograms and other preventive tests. Yet this guy is 100% against socialized heath care because “it doesn’t work”.
Just last night I told my wife “Brett sacrificed his wife at the altar of Capitalism”.
And to think Jesus brought people back from the dead for free.
Not to mention the free medical for the living!!
……. or they choose to cherrypick a few verses of ugliness from the old testament to support their two-trick pony theology. Alternately, they’ll make an interpretation of Revelation(which is almost always a distorted false one) in order to scare people.
exeter
Very well stated. Having good character= good morals. Or as Maya Angelou says, “When people show you who they are, believe them.”
the tea party is not a religious movement or group. it is about more freedom, less taxation, less govt intrusion, less govt spending, less govt debt not religion.
“If that’s what they are why do they keep saying that’s not what they are? Is there an advantage to be perceived as not what they are? ”
i am not a believer in god, yet i believe in the tea party principles.
there is religious diversity and atheism in all political parties.
I think you missed the point Charlie. The point was that most Tea Partiers are fundies, and that is what drives their ideologies. Like I mentioned above, Fundies worship at the altar of Capitalism, ignoring Jesus’s teachings regarding the poor (My fundy brother has seen the light regarding this and is beginning to change his world view on the matter). Heck, I recall good ol’ Jerry Falwell insisting that you had to be a Cpaitalist to be a good Christian.
Oh goodie, a real tea-partier. I assume you “want your country back.” OK, so what America do you want back? America of the 1980’s? 1950’s? Teddy Roosevelt? Gilded Age? Antebellum South? Jeffersonian agrarian paradise? Colonial Massachusetts, site of the original Tea Party?
“I assume you “want your country back.”
(Hwy hands Sarah The “TrueRogueMaverick” Cheney’s TruthPaddle…)
Run oxide,…RUN!
I am sure they will take us back to same America Obama took us back to.
Yes and there are log cabin republicans and a few blacks not sure I get your point??
I want all these things too. Unfortunately, I can’t join the Tea Party because I realize, at least in the short term, that they are contradictory.
By “more about freedom” they actually mean the opposite.
Can’t have people burning flags or marrying whoever they want or having abortions now can you??
“If that’s what they are why do they keep saying that’s not what they are ??
Because that is the only way they can distance themselves from Dubya….We tried the neocon evangelical route…How did that work for ya ?? They can’t come back and say we are the neocons and we are here to save ya now can they…So, they grab a new slogan “Tea Party”….
Does anyone here read lamestream media?
Tea Partiers are people saying stop robbing me blind with the Fed and illegal immigration who when they show up at hospitals..get charged 3x their annual salary a pop..
Matt Taibbi’s Griftopia opens with a chapter which details the Tea Party’s mission to provide a pleasant decoy for Wall Street’s cleptocratic activities.
Taibbi wrote a hilarious piece for Rolling Stone about the Tea Party rally he attended. He was stunned by the amount of “medical hardware:” walkers, scooters, wheelchairs, various gross-bags, and oxygen tanks. That description makes me wonder about the millions of PILLS the rallygoers were surely taking.
All paid for, btw, by “government interference.”
Like I said below, they are for “less government” as long as they continue to receive their freebies.
In Brazil, my searches in English bring up a lot of British, Aussie, Canadian results. The coverage is a bit different overseas. Like this story. I wonder if it got a lot of coverage in America and how much truth there is to it.
Report links Tea Party movement to white supremacist groups
http://www.guardian.co.uk/world/2010/oct/20/report-links-tea-party-to-white-supremacist-groups
Document alleges that Tea Party meetings are used as recruiting grounds for racist groups
The Tea Party movement has extensive links to white supremacist groups, a report published by the Institute for Research & Education on Human Rights today has alleged.
The report lists incidents, individuals and websites it claims demonstrate the links, and also expresses concern that Tea Party meetings are used as recruiting grounds for racist groups. The movement has repeatedly denied it is racist.
…the report “exposes the links between certain Tea Party factions and acknowledged racist hate groups in the United States. These links should give all patriotic Americans pause”.
One of the concerns in the report is the portrayal of Barack Obama as non-American. “Consider, for example, the incessant depiction of President Obama as a non-American,” it says.
“The permutations go on from there: Islamic terrorist, socialist, African witch doctor, lying African etc. If he is not properly American, then he becomes the ‘other’ that is not ‘us.’”
…The report also cites racist comments about Obama’s family on the Free Republic website. A photograph of Michelle Obama had the caption: “To entertain her daughter, Michelle Obama loves to make monkey sounds.”
Knock it off, Rio.
Knock it off, Rio.
What? This is big casino stuff- central issues of our times. People are trying to figure out the make-up of an important and influential movement that is attempting to change American policies, economics and society. But that’s all they want to do. No questions, no wondering?
Are we Americans afraid to confront ourselves over important issues these days because it might feel uncomfortable or not PC?
And I learn and am reminded of stuff here. Like I just was reminded that a certain group is much more “religious” right than Christian-right. I’ll probably learn some more stuff today too.
i am neither a Christian Conservative nor a white supremacist.
congratulations on confronting the important issues of the day
Just because you aren’t one doesn’t that mean that you are the norm for the group.
Well Charlie your previous posts certainly contradict you.
(Didn’t someone just say the tea party is contradictory?)
i posted that i am religious or that i am a white supremacist?
care to dig it up?
so colorado,
you assign a “norm” then attack it?
its about less govt, not your straw men
Charlie or whatever your latest username, there is no need to. Your posts state the obvious.
“its about less govt”
Yeah right. These are the same folks holding up the “keep your hands off my social security and medicare” signs at the rallies.
Sure, they want less gov’t … as long as it doesn’t affect them.
There is no way those are Tea Party signs. They’re correctly spelled.
Call it what you will but I am all for less government.
I am for less wasteful government. Like those super expensive wars we keep fighting for no good reason.
“…These links should give all patriotic Americans pause”
Rupree MUrDock = TrueGritAmerican, …”Now listen here pilgrim, I’m gonna eda-kate ya…
“You must keep your mind on the objective, not on the obstacle.”
William Randolph Hearst
lil’ Opie,…the (non-Hawaiian) Socialist-Islamist-Muslim UK polecat band member.
The Tea Party is a perfect “concept in action” and “lab demonstration” as to why we don’t have more political parties.
As for complaining we don’t have other parties, that’s just not true. We have Libertarians and Greens who hold office and both parties have captured offices off and on for the last 20+ years.
Tom Tucci of RBC Capital Management on WBBR Blooomberg today and it was a great interview. I don’t have a link but I’m sure it’s out there. Many great comments vindicating us including a blurb on retirement, boomers, etc. One of the more notable comments was;
“The administration and the Fed has dampened the housing price collapse but prices will continue to slide down.”
Controlled collapse anyone?
Message to sellers? Your best price is todays price. Get what you can get for your shack today because it’s going to be less tomorrow for many many years to come”.
Many Americans live precariously close to the edge of financial insolvency flirting with economic disaster daily. If you casually browse mainstream articles and watch any amount of television you would think that the US still had a vibrant and strong middle class. When we pull back the covers on the current financial situation we realize that many Americans are merely getting by and many would like to live in some 1984 Orwellian fantasy world where suddenly things are back to financial equilibrium. 43 million Americans are depending on government food assistance to get by. But many more millions are merely living paycheck to paycheck hidden in the cellar of the headlines. 1 out of 3 Americans has zero in any retirement account (not one slowly eroding dollar). Half of Americans have $2,000 or less which puts them one month away from needing government assistance. With the volatile job market and turbulent Wall Street middle class Americans are feeling the once prided stability being slowly washed away. Let us examine how retirement is now becoming more of a fantasy for many Americans.
(From Zero Hedge)
1 out of 3 Americans has zero in any retirement account (not one slowly eroding dollar).
That includes nearly all 20-somethings and half or more 30-somethings. We did not start saving/investing for retirement until well into our 30’s.
I imagine those in their 30’s today expect the retirement age to be at least 70 by the time they retire.
Figures lie and liars (and alarmists) figure.
And food stamp usage is skyrocketing, median wages in my county have fallen 10% in the past decade, personal bankruptcies have soared back to record highs in spite of the tigher rules. U6 unemployment was 17% in November.
Yeah, everything is peachy. I’ll stop listening to those alarmists.
Watch the stock market to tell how well you are doing. Don’t listen to your hunger pangs and stop shivering.
And don’t forget to cheer for your local NFL team. And vote yes for some more corporate wefare for them. They deserve that taxpayer provided stadium.
The time value of money says those 20 year olds should be investing at least a tiny something from their paycheck.
But interest rates are abysmally low, and risk of fraud abundant.
And salaries low, and expenses high!
There’s an old saying: First you have to HAVE some money in order to save some money.
$12hr is the real min wage. And $12hr is also the new avg wage. There is NOTHING left over after BASIC expenses.
I’m a lot closer to retirement than those 20-somethings and I wonder if my savings will be worth anything in 30 years when I really need it.
40 million don’t really rely on the government for food.
You can easily live on the $6/day that is other wise spent on cigarettes. Not to mention the $100/mnth spent on cable/dish. Or the $30/mnth spent on cell phones. Or the $$$$ spent on shiny rims. Etc etc etc.
That must be why food pantries are being stripped bare these days.
Some years ago I worked once a month at a soup kitchen in Escondido, CA. The people who came were the saddest looking group of people I ever saw. And no, they didn’t wear designer clothes, drive fancy cars or spend the time yakking on their cell phones.
Coffee and sugar were always in short supply at the soup kitchen, so I used to stop by CostCo the night before to buy some to donate to the soup kitchen. These people were so down on their luck that having a cup of coffee made their day.
Steve, you should get out more often.
Shelter alone is over half of a $12hr wage. Basic utilities are another 1/4. (elec, gas, water/sewer depending on where you live) Then there is transportation, because your job sure as hell is not going to be on a bus line… if you even have bus service. (most likely not) That’s gas, insurance and maintenance.
The best I’ve ever been able to do this decade is $30 week for groceries. That’s food AND toiletries.
Here’s the monthly breakdown in my city:
Rent - $600 (this is NOT high end)
Utils - $200 (gas, elec, phone)
Insurance - $70
Gas - $120
Food - $120
Car repair - $120 (avg over the year. ex:oil change, tire rotation, tune-up, AC charge, misc)
Car payment - $0+?
Clothing - $0+?
Various deposits required for above - $300+ (total)
Income after taxes of $12hr - $1520
1520 - 1230 = 290
290/4 = $72.5 left over each week.
You will note that a car payment and clothing nor savings for deposits were included.
This assumes everything stays perfect and you never get sick or your car has a serious problem, because god help you if you do.
Because you will.
I’m also getting tired of running these numbers out for people who should be able to do basic algebra while claiming that anyone can live just fine on $12 or less.
Just going by what I see at my grocery store. Food stamp recipients always split out the beer and ciggies and pay for them separately. It always seems to be milk, steaks, cheese and breakfast cereal being bought. And donuts.
Different states have slightly different rules on what can be bought with food stamps, but beer and cigarettes are not on the list. Donuts… it depends.
And believe me, when you’re that poor, beer and cigarettes are all that’s keeping you from jacking somebody in their BMW.
What’s up with the donuts? Was behind a woman last week. After getting her WIC allowed food rung up, the checker said her coupons had expired. Her response, “Oh I must have grabbed the wrong ones” After canceling out the transaction, the lady paid cash for her donuts.
Then they are cheating and have hidden income (if they’re buying steaks and beer). But from my experience (which goes beyond peeking into other people’s shopping baskets and watching how they pay) the cheaters are the exception. And with 17% U6 unemployment there’s no shortage of people who depend on foodstamps to survive.
I know more than a few folks on food stamps and they aren’t living it up. If anything the food stamps aren’t enough and they have to hit the food pantries. There’s also a store here in town that sells food that’s past its “best by” date at a heavy discount. From what I have heard they get a lot of food stamp customers.
My son knows a few from school. From what he’s seen the best meal of the day they get is the free school lunch (yuck). At home, from what he’s seen, they live off of mac’n'cheese, hot dogs and peanut butter.
Truthfully I wasn’t upset about the donuts, nobody knows better than me the need for a little sugar rush. After I got in my car I just kept thinking, if I needed and was given food vouchers I would not in a million years let one of them expire.
Nice post cobaltblue….
1 out of 3 Americans has zero in any retirement ??
Thats a pretty disturbing number….
30 years of offshoring millions of jobs and wage cuts for millions more will do that.
Whocouldaknowed?
Half of Americans have $2,000 or less which puts them one month away from needing government assistance.
Half of Americans??!! Good Lord, what are you people defending??
A rich, extended family of 8 might spend that tonight at a high end NYC restaurant.
(And then go to a nightclub)
Here’s a nice reading list suggested by a 2010 Global Economic Symposium. I thought ProfBear, Arizona Slim and other prolific readers might find something new here.
http://wiwi-werkbank.de/2010/06/staatsschulden-und-konsolidierung-der-staatsfinanzen-in-der-welt/
Thanks for this, CarrieAnn
It pains me that the attendees likely assigned this bibliography to their aids and of course, nothing came of it. Those who did the actual analyses were likely those protesting the symposium.
Sigh.
CRAAAAAAAAAAAAAAAAAAAAAAAAAASH!!!
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
That was the sound of housing prices collapsing in *your* neighborhood.
Even my ‘hood is showing the signs of collapse now, and in listing prices, not just sale prices. The peak (2006) listing price for an SFR in our zip code (92127 Rancho Bernardo West San Diego) was $1,395,000. As of today, according to the data on Redfin dot com, it stands at $689,000, off by (689,000/1,395,000-1)*100 = -50.6% — a pretty short haircut, already.
My hood is showing some drops as well, but they still appear to be isolated examples rather than the norm — we’re still waiting for critical mass. The condo crash is hiding under “rent-to-buy” schemes.
What’s the square footage of that house, PBear? How close to the beach?
“As of today, according to the data on Redfin dot com, it stands at $689,000, off by (689,000/1,395,000-1)*100 = -50.6% — a pretty short haircut, already.”
Still pretty high when you can get a similar house in flyover country for 1/3 the price
http://www.bloomberg.com/news/2010-12-28/u-s-property-values-decline-more-than-forecast-in-s-p-case-shiller-index.html
As usual, the usual “economic experts” who act as shills for Wall Street and the REIC missed in their forecast by a factor of 4X (.02 drop expected, .08 drop actual) on the “unexpected” drop in home prices. Is there anyone who actually listens to these asshats anymore?
Sure. The other asshats who are their marking-Level 3-to-fantasy to prop up their stock options.
Keep it up Rio! Great job in posting that article on the tea baggers. Expose the tea partiers (and the individuals on this site who think and act just like them)’for what they are. I have seen enough posting about ACORN, illegal immigrants (like the native Americans asked White people to come here), and Obama to know that many of the posters hear believe that the only people who have a right to live in this country and complain about what’s wrong (even though it is rich white men who are destroying this country) are white people.
“Keep it up Rio! Great job in posting that article on the tea baggers. Expose the tea partiers (and the individuals on this site who think and act just like them)’for what they are. I have seen enough posting about ACORN, illegal immigrants (like the native Americans asked White people to come here), and Obama to know that many of the posters hear believe that the only people who have a right to live in this country and complain about what’s wrong (even though it is rich white men who are destroying this country) are white people.”
Where have you been Spook?
South Florida’s Real Estate Market Projected to Bottom Out in 2012
Posted by Bryan Ellis Real Estate Letter News Team on Monday, December 27th 2010
As the year comes to a close, the real estate arena is teeming with predictions about the future. As usual, every market and every analyst has its share of optimistic and pessimistic predictions, and every expert has his or her own personal take on just where real estate is headed in the coming year. However, most do appear to agree that it just isn’t quite over for south Florida, though the end may finally be in sight.
Moody’s Analytics predicts that south Florida real estate, which appears to be showing some very preliminary signs of a recovery in that the price declines have “leveled off” though prices have not yet started to improve, will continue to stagnate in 2011 due to “angst” related to unemployment, with a recovery making an appearance in the “second half of 2012” after housing prices on existing homes “tumble another 16 percent or so”[1]. Local analysts like Lewis Goodkin, a Miami housing consultant, agree with the forecast, although some believe that the condo market could start to improve sooner.
that the condo market could start to improve sooner.
That alone discredits this entire article, as if the author affiliations were not indication enough. Condos are the LAST market to improve, in any market.
I guess they didn’t expect this….
Home Prices in U.S. Decrease More Than Forecast Bloomberg 12-28-10
Home prices dropped more than forecast in October, a sign housing will remain a weak link as the U.S. recovery accelerates into the new year.
The S&P/Case-Shiller index of property values fell 0.8 percent from October 2009, the biggest year-over-year decline since December 2009, the group said today in New York. The decrease exceeded the 0.2 percent drop projected by the median forecast of economists surveyed by Bloomberg News.
A wave of foreclosures waiting to reach the market means home prices will remain under pressure in 2011, representing a risk to household finances. Federal Reserve policy makers this month said “depressed” housing and high unemployment remained constraints on consumer spending, reasons why they reiterated a plan to expand record monetary stimulus.
What? Wages and jobs do matter? I thought Citibank said they didn’t?
Who ya gonna believe? Your sugar daddy or reality?
Only 4?
Four Real Estate Market Predictions for Homebuyers in 2011
http://www.walletpop.com/2010/12/28/4-real-estate-market-predictions-for-home-buyers-in-2011/
1. Prices and mortgage rates will stay low in most areas, but will rise in affluent areas and markets experiencing job/population growth.
2. Loan guidelines will tighten up, and down payments and loan costs may rise.
3. Condos will become even more difficult to buy.
4. Conservative buying will be the name of the game.
but will rise in affluent areas and markets experiencing job/population growth ??
Why ?? Because they can thats why…Bandits…
I will now put myself in timeout for posting long articles. Because apparently posting long articles and riding the dog like it is a small horse is frowned upon in this ESTABLISHMET!
http://www.youtube.com/watch?v=x0GsNhLt9Ds - 137k -
Home prices falling faster in biggest US cities
By JANNA HERRON The Associated Press
Posted: 9:04 a.m. Tuesday, Dec. 28, 2010
NEW YORK — Home prices are dropping in the nation’s largest cities and are expected to fall through next year, as fewer people purchase homes and millions of foreclosures come on to the market.
The Standard & Poor’s/Case-Shiller 20-city home price index released Tuesday fell 1.3 percent in October from September.
All cities recorded monthly price declines. The last time that happened was in Feb. 2009.
Atlanta recorded the largest decline. Prices there fell 2.9 percent from a month earlier. Home prices in Washington dropped 0.2 percent in October, the second monthly decline after five straight increases.
Home prices in Dallas, Portland, Ore., Charlotte, N.C., Tampa, Fla. and Denver have fallen for four straight months.
The 20-city index has risen 4.4 percent from their April 2009 bottom. But it remains 29.6 percent below its July 2006 peak.
This year is on pace to finish as the worst for home sales in more than a decade. High unemployment and tight credit have kept people from buying homes, despite some of the lowest mortgage rates in decades.
Government tax credits gave the ailing industry a boost this spring. But they expired in April, and in recent months, home prices have begun to dip again.
Millions of foreclosures are forcing home prices down and more are expected in the coming year. Many people are holding off on making purchases because they fear the market hasn’t bottomed out, analysts say.
And mortgage rates are rising again. In the last month, rates on fixed mortgages have surged more than a half-point to near 5 percent.
Most experts expect the declines to continue through mid-year with prices on average to lose another 5 percent to 10 percent. The worst price drops will come from cities with a struggling economy and the highest foreclosure rates, while those with better job growth will fare better.
Home prices have declined in 18 of the 20 cities in the past year.
Home prices are dropping in the nation’s largest cities and are expected to fall through next year, as fewer people purchase homes and millions of foreclosures come on to the market.
There has never been a better time for dips to buy real estate!
Keep it up Rio! Expose the tea partiers (and the individuals on this site who think and act just like them)’for what they are. I have seen enough posting about ACORN, illegal immigrants (like the native Americans asked White people to come here), and Obama to know that many of the posters hear believe that the only people who have a right to live in this country and complain about what’s wrong (even though it is rich white men who are destroying this country) are white people.
ACORN workers caught on tape allegedly advising on prostitution
September 10, 2009
Two employees at the Baltimore, Maryland, branch of the liberal community organizing group ACORN were caught on tape allegedly offering advice to a pair posing as a pimp and prostitute on setting up a prostitution ring and evading the IRS.
The video footage — which has been edited and goes to black in some areas — was recorded and posted online Thursday by James O’Keefe, a conservative activist. He was joined on the video by another conservative, Hannah Giles, who posed as the prostitute in the filmmakers’ undercover sting.
Imagine if all the banks were shut down when one or two employees were caught braking the law. We’d have no banks.
It shoudl be noted that his film was highly edited. One person who phoned the cops on the guy after he left the building was still portrayed as assisting Okeefe.
Oh dear PB.
That was since proven to be faked and the “producer” was later arrested for BREAKING INTO AND WIRETAPPING A FEDERAL OFFICIAL’S OFFICE (a senator) while filming another “expose”.
Yes, you can Google it.
“That was since proven to be faked”
No it wasn’t. Sheesh.
ecofeco
Yes. Yes it was. Google “fake acorn video.”
It’s not speculation, it’s verified.
VERIFIED.
The editing was done completely out of context.
Breaking News!!
Republican president resigns over ties to Watergate break-in.
Should have disbanded the Executive Branch after that one.
‘…There is an old joke that economists only make predictions so that the weather guys have someone to laugh at.”
Hedge Funds Crash, Apple Turns Uncool in 2011: Matthew Lynn
Bloomberg
No. 8. Iceland teaches the world a lesson. Two years ago, every government in the world bought into the idea that you had to bail out your banks. If they collapsed, you would go straight back to the Stone Age. One country defied the consensus. Iceland couldn’t afford to keep its banks going. What happened?
I’d like to invest in Iceland. They deserve a prize.
Of note the people stood up to the banks and won. They had politicians that sided with the people.
IIRC, they had to throw a few out before this happened.
“Blitzer: Home prices heading for double dip”
http://www.marketwatch.com/story/blitzer-home-prices-heading-for-double-dip-2010-12-28
“U.S. house prices tumble in October”
http://www.marketwatch.com/story/us-house-prices-tumble-in-october-2010-12-28
CHINA, ECONOMY, FUN WITH STATISTICS! SOURCE: Harper’s Index
“Yeah, About That Whole “China is the Second-Largest Economy in the World” Thing…”:
By Justin Rohrlich December 28, 2010
“Remember back in August, when the headlines were filled with breathless announcements that China had surpassed Japan to become the second-largest economy in the world?
So do I. And, yes it did. By GDP.
This month’s Harper’s Index reminds us of the difference between GDP and GDP on a per-capita basis:
Global rank of China’s economy in 2010, measured by GDP: 2
Rank if GDP is calculated on a per-capita basis: 94
On the afternoon of August 16th, when the announcement was made, Mark Perry, the well-known University of Michigan economist, pointed out on his Carpe Diem blog that, although China now ranked #2 as per GDP, “it ranks #102 [on a per-capita basis] according to the CIA, #99 according to the IMF, and #92 according to the World Bank. In fact, on a per-capita basis in 2009, China ranked behind Namibia, Jamaica, Belize, Thailand, El Salvador, and Albania. And the last time the U.S. had per-capita GDP of $6,567 was back in 1932.”
Robert Reich wrote on Business Insider:
“…Don’t be misled by these numbers. The important thing isn’t China’s ranking, nor the total value of China’s production, nor even the extraordinary speed by which China has reached #2. What’s most important is the share China’s production received and consumed by the Chinese themselves. The problem is it continues to drop.
Now, about all those wealthy consumers in the world’s “second-largest economy” just poised like tigers, ready to buy up all those American products US industry is counting on…”
Don’t be misled by these numbers. The important thing isn’t China’s ranking, nor the total value of China’s production, nor even the extraordinary speed by which China has reached #2. What’s most important is the share China’s production received and consumed by the Chinese themselves. The problem is it continues to drop.
This is precisely what globilization does in a world of limited resources. This is precisely what happens when countries pit their printing presses against each other and concentrate the printed dollars in the hands of the elite. The middle class will shrink spending a higher and higher percentage of their income on food and fuel and less adn less on services and manufactured goods leading to more and more unemployment.
Didn’t Rio post some facts and figures that the Chinese internal market was growing?
Didn’t Rio post some facts and figures that the Chinese internal market was growing?
I did. Maybe 5 articles from mainstream publications with figures that most of us would assume to be semi-reliable.
The difference between what I did post and what I am now reading makes me suspect that China’s actual economic situation resembles Winston Churchill’s description of a riddle wrapped in a mystery inside an enigma.
However, what they are in fact buying from Brazil currently, does not.
Germany also seems to have a pretty good export market to China.
Rank if GDP is calculated on a per-capita basis: 94
I assume that this is the average.
Which means there are probably a billion Chinese still living in Mao-villes and eating a bowl of rice a day. Only the young and talented are making any progress in the cities, where they work at a Nike sweatshop for the priviledge to… overpay for a condo in a city where they had to shut off the factories for two weeks just to convince the Olympic marathoners that they wouldn’t dorp dead.
Just great. And to make it worse, I contributed to this sad state of affairs when I bought some stuff from Sears on Sunday. It’s hard to find things NOT made in china.
It’s hard to find things NOT made in china.
It’s pretty easy in Brazil still. The US “capitalist” experiment of the past 40 years has failed.
Oh, sorry. Silly me. I mean only failed 95% of us.
+1 Rio…
Nobody wants another Brazil.
Montana, you posted an article with no comment. I live it
Here’s a quote from that article:
It seems pretty obvious, from what little I know of Brazil,
“obvious from what little I know”? ?
Here’s what I know and live…..Brazil’s middle class is growing. America’s middle class is shrinking.
Dig it.
Zeitgeist 2010: How the world searched
(Hwy did what he could, but Phylis Diller didn’t make the list) :-/
Happy Kwanzaa Day Gift idea:
Death of the Liberal Class [Hardcover]
Chris Hedges
Chris Hedges (Author)
› Visit Amazon’s Chris Hedges Page
Find all the books, read about the author, and more.
See search results for this author
Are you an author? Learn about Author Central
(Author)
4.3 out of 5 stars See all reviews (17 customer reviews)
17 Reviews
5 star: (11)
4 star: (3)
3 star: (1)
2 star: (1)
1 star: (1)
› See all 17 customer reviews…
Like (12)
——————————————————————————–
List Price: $24.95
Price: $16.47 & eligible for FREE Super Saver Shipping on orders over $25. Details
You Save: $8.48 (34%)
If Uncle Sam could afford to finance multi-million dollar Wall Street investment banker bonuses after their firms collapsed, can’t he also spare a few dimes to help retired educators maintain the standard of living to which they are accustomed? Bailouts are for the big fish; financial collapse is for the little people.
Educator pension crunch looms
With no clear way to fund retirement benefits, state system faces huge shortfall
By Maureen Magee and Danielle Cervantes
Monday, December 27, 2010 at 8:54 p.m.
San Diego’s pension problems have given the city a bad name nationally, but it’s becoming more apparent every week that similar benefit levels and funding shortfalls are plaguing governments small and large across the nation.
As part of an ongoing examination of these issues, The Watchdog has reviewed local educator pensions and found a familiar story — high benefits with no clear way to pay them.
The state teacher’s pension system faces a $40.5 billion shortfall over the next 34 years, in part because it owes payments for life to people such as Rudy Castruita, the retired superintendent of the San Diego County Office of Education.
Castruita receives the region’s top educator pension of $281,034 a year, or 107 percent of his final salary. That pay in retirement exceeds U.S. Education Secretary Arne Duncan’s 2009 base salary of $196,700. Castruita, a 1992 state superintendent of the year, did not return several calls.
The review found:
• The average retired educator in San Diego County is paid $40,633 per year, or 58 percent of final salary. That’s more than the average general city worker at $37,442 but less than the $67,428 for firefighters or the $62,098 for police officers.
• About 5 percent of educators receive pensions that pay them 100 percent or more of their final salary.
• Some 254 receive pensions of $100,000 or more, or 1.7 percent of the retirees. That compares to 3.4 percent of city retirees.
As with the San Diego city pension system, benefits for current pensioners are locked in and protected by law. Changes in the coming years could affect current employees — and taxpayers — as policymakers struggle to fill the gap.
…
Educator pensions
San Diego County
Retirees: 15,358
Collective annual allowance: $624.5 million
Average pension: $40,663
Highest pension: $281,034
Average final pay: $67,313
Average years of service: 26
This guy has no idea what poor is. He is truly out of touch with the reality around him to put this remark in a newspaper.
It’s a very difficult job, a 60-hour-a-week job. None of us are rich from it. Some may think we are, but we are not,” said Hogarth, whose annual pension pays him $216,348 or 105 percent of his final salary.
Wow! That guy takes top prize for useless entitled whiner!
Well, after the Bankstas, anyway.
I don’t know if I should be upset with $40,000/yr pensions, that seems reasonable. Sure that’s dog food subsistence in San Diego, but most smart people would take that California tax funded pension and move to a low cost (no tax state).
What does a typical 401k’er have to amass in their savings at 65 to get $40k/yr for 20 years?
ecofeco
Before or after the company stops matching?
“…Castruita receives the region’s top educator pension of $281,034 a year, or 107 percent of his final salary. That pay in retirement exceeds U.S. Education Secretary Arne Duncan’s 2009 base salary of $196,700. Castruita, a 1992 state superintendent of the year, did not return several calls.”
Another happy, taxpayer funded, Reasonably Compensated “No-one-could-ever-do-this-job-for-less” Pension Cult member. ;-/
(Hwy notes that at the OUSD in “The OC!” the schoolboard policy is thus: “The new Superintendent’s pay will be equal to or greater than the previous job holder,…regardless of experience” currently this eda-kate-shun job salary is $251,000+ beneifits)
Irresistable force (pension benefits protected by law) meets immovabe object (bankrupt municipalities).
To top it off, something like 26 states don’t allow municipal bankruptcies.
In the past when you moved somewhere you had to look at crime, jobs, schools, taxes, etc. now you also need to take in consideration the fiscal outlook of the state and municipality. Union contracts, outstanding debt, pension obligations, etc.
With bankruptcy not an option they will extort more and more taxes out of their population until they declare bankruptcy or move away.
The problem is 26 years worked for how many years in retirement? That is the problem, not the pay and not the pension amount.
Yup, it is a good thing they do not figure out how to make government retirees last to 150. The lack of a specific dollar value to a given retiree is a big part of the trouble, particularly as people are living a lot longer now. It is also unfair to the poor schmuck who works his whole life then dies without being able to collect. Retirements should have an actual dollar value which is paid for by the retiree and no one else.
“Standard of living to which they become accustomed.”
That phrase annoys me no end. I am fully in favor of seeing that these public servants receive enough to live a low-level life; that is, ~30-40K a year. But I see no reason to provide anybody with a “standard of living to which they become accustomed.”
How dare you question the very people who call everyone else lazy and undeserving!
Makes me mad every time I pay a a dime in tax!!!
Just remember: it isn’t the rank and file, it’s their bosses who are stealing you blind while complaining about J6P’s “entitlement”.
If Blitzer broached it, then by golly it must be for real. Try not to catch yerself a falling knife real estate investment!
S&P’s Blitzer broaches ‘double dip’
U.S. home prices retreat
Prices decline in all 20 metropolitan areas tracked by the closely watched Case-Shiller report. Six cities — from Seattle and Portland, Ore., to Charlotte, N.C., and Tampa — hit lowest points since downturn.
I though this was the best xmas season n a decade?
What could possibly be better than a return of affordable housing prices?
MarketWatch should get a TV show on Comedy Central.
MarketWatch First Take
Dec. 28, 2010, 11:45 a.m. EST
The economy is great if you have money
Commentary: Falling home prices hurt those who have just a little
By MarketWatch
WASHINGTON (MarketWatch) — U.S. consumers seem to have a split personality.
They are spending money at the malls, making this holiday shopping season the best in four or five years, according to various reports from MasterCard and the chain stores themselves. Read more about holiday spending.
However, consumers are still in a very cranky mood. The consumer-confidence index slipped in December, the Conference Board reported Tuesday. Consumers are pessimistic about the job market and are feeling the pinch of higher energy prices. Read our story on consumer confidence.
The confidence index is now slightly lower than it was a year ago.
If consumers are so downhearted, why are they spending so freely? One explanation might be that this economy is great for those with money to invest and to spend, but not so great for the majority of folk who rely on their paycheck to make ends meet and whose wealth is in the house.
…
” but not so great for the majority of folk who rely on their paycheck to make ends meet and whose wealth is in the house.”
Change that to not so great for the folk on ‘how mucha month it agon’a cost me plan’.
No better experience than that given by life experiences due to poor choices….no government plan is going to help!
Another explanation is that they are purchasing things they will need believing that xmas sales are the best time. Then consumption will fall off a cliff. We’ll see.
While not explicitly (and most likely on purpose) stated, it’s looking more and more like those purchases were being… charged.
This is a trend that won’t do much to help support bubble-era real estate prices.
American Cities That Are Running Out Of People
Posted: December 27, 2010 at 11:11 pm
The population of the United States has increased steadily by roughly 2.5 million people every year since World War II. Throughout prosperity and hard times, Americans continue to have families. Many of the country’s regions have expanded to accommodate this population increase. Some cities have grown faster than others as the result of being at the center of some important new technology or job market. Others have lost residents because of failing industries and migration. Nevertheless, some of these cities have continued to grow slowly, or at least remain relatively stagnant, buoyed by the rising tide of the national population.
There are some cities, however, which have experienced such severe hardship and decline that their populations have actually decreased significantly. New Orleans has lost more than a quarter of its population in the past ten years as the result of Hurricane Katrina. The rest of the cities that have lost major parts of their population have seen their flagship industries which include coal, steel, oil, and auto-related manufacturing fall off or completely collapse. America moved away from its status as an industrial superpower in the second half of the 20th century as the services sector rose to replace it. Millions of US manufacturing jobs have moved overseas. Cities such as Rochester, Cleveland and Buffalo declined in population because they were trade hubs, and new modes of transportation removed their geographical dominance. Cities like Flint, Michigan have economies based on a single major industry. In Flint’s case, that industry is auto manufacturing. When that industry began to decline, Flint was unable to diversify to prevent a population exodus.
…
A blogger up here in the Great White has been advising his readers to diversify into a portfolio of bonds, preferred shares, reit’s and etf’s managed by an active advisor to see the trends and stay ahead of the curve. He claims an overall increase of 14% over the year. Any comments from the highly esteemed members of this blog. He also is convinced that the Canadian housing bubble is about to blow up, which I don’t doubt.
Rosie, ask yourself how much money said blogger makes from his speaking engagements and the sales of his books. He will say and write whatever his “following” wants to hear because they are PAYING him to do so.
Think for yourself.
1) Asset prices are fundamentally unpredictable.
2) Any asset manager who pretends to know where asset prices are headed is a scam artist who wants to collect up-front fees in exchange for pretend knowledge.
Unless he knows someone at the FED?
Last time I checked, the Fed was trying to backstop housing prices.
How’s that working out for them?
see the trends and stay ahead of the curve.”
sounds great almost too good to be true ….
http://www.flixxy.com/gm-hy-wire-concept-car.htm
Ha! build an alternative energy generator, mount it on cool wheels, bolt on a body style of choice, pick a color you like,…
Nothing new here. Hydrogen has been tested in cars for over 40 years.
As for “drive by wire” many of today’s new cars are already equipped with it.
As a friend of mine would say, “the boffins” have been trying to get us to switch to the hydrogen energy economy since the 1970s.
Because there’s lots of hydrogen just lying around……
ecofeco
You live on a planet that is 3/4 covered in it. Yeah, it’s combined with oxygen, but it truly is just lying around.
A little window dressing for the end of the year.
Real estate down, consumer mood glum
Time for a rally
Yup. Dow up 20 points.
I think we are in for a serious correction sometime next year. Stocks cant go higher like this with no rhyme or reason.
I think we are in for a serious correction sometime next year ??
lets ask Eddie….
“Stocks cant go higher like this with no rhyme or reason.”
Why not? They’ve been doing it on and off again for many years already…
“people should not try to deal with that stress alone.”
Suicide increase concerns South Georgia psychologist
ALBANY, GA (WALB) –South Georgia psychologists are concerned by a high number of suicides.
Dr. Cheryl Kaiser says she’s treating more family members of suicide victims than she ever has.
She says long-term high unemployment and the holidays are a dangerous combination.
“It’s no coincidence that we have so much economic turmoil and that there is a positivity of jobs and people. There homes are going into foreclosure. Their businesses are being lost. That’s a lot of stress that people have to deal with, “said Kaiser.
Kaiser says people should not try to deal with that stress alone.
The problem is that those therapists charge $100 a session and if you’re uninsured and unemployed … you won’t be seeing a therapist. Even at half the price they won’t be seeing a therapist.
yep, a lot of the therapists think their medical doctors and want to rip people off.Most of these people just need someone to talk to.With modern technology a lot of people can become lost in society.especially when you have to go to facebook to have imaginary friends.
“Kaiser says people should not try to deal with that stress alone.”
The hardest thing for most people understand is that poor people have no friends and psych counseling is a unaffordable luxury.
The next hardest thing is realizing what an ass you’ve been after you find yourself poor through no fault of your own and realize that you now have to listen to others tell you what you always said… how it’s all the your fault.
Payback is a b!tch.
The hardest thing for most people understand is that poor people have no friends
But most poor people do have some friends and family don’t they? I mean unless they were total jerks.
you now have to listen to others tell you what you always said… how it’s all…your fault.
Well, at least if or when I get poor I won’t feel guilty about telling in the past most of the poor it was all their fault.
“But most poor people do have some friends and family don’t they? I mean unless they were total jerks.”
In this country, even your “friends” and family judge you only by your bank account. There are of course, exceptions.
“Well, at least if or when I get poor I won’t feel guilty about telling in the past most of the poor it was all their fault.”
Either I’m not parsing this or I my post wasn’t clear. My point was that many of the current suicides are due to the self-righteous who found out that they weren’t the masters of their fate they thought they were and now they have to listen others who will blame them for their misfortune. The very thing they practiced themselves.
That kind of humility is more than many can take.
“Well, at least if or when I get poor I won’t feel guilty about telling in the past most of the poor it was all their fault.” (Me, Rio)
And for me to be clear:
I won’t feel guilty because I never told most poor people it was their fault or thought it was their fault either.
ecofeco
Oh I agree with that. There are certainly plenty of folks where it was there own fault.
Q: Do you know the difference between a Realtor and a seagull?
A: The seagull can still leave a deposit on a Mercedes.
And then things got interesting
NEW YORK (Reuters) - Allstate Corp has sued Bank of America Corp and 18 other defendants over alleged losses on more than $700 million of mortgage securities it bought from Countrywide Financial Corp.
The largest publicly-traded U.S. home and auto insurer alleged it suffered “significant losses” after Countrywide misled it into believing the securities were safe, and that the quality of residential home loans backing them was high.
lmao, everyone sueing everyone now.Lawyers are having a field day.
having a field day ??
Having a field “decade” is more like it…
And so it begins…
We’ve only just begun…
Paper Economy
Case-Shiller: Slump in home prices is beginning
Case-Shiller 10-city index shows home prices fell 1.2 percent in October alone.
By SoldAtTheTop, Guest blogger / December 28, 2010
Today’s release of the S&P/Case-Shiller (CSI) home price indices for October (browse the dashboard) reported that the non-seasonally adjusted Composite-10 price index declined a whopping 1.24% since September indicating that in the wake of government’s housing tax gimmick, prices continue to follow sales down.
…
Longtime reader here (haven’t posted in years). I proudly support the tea party movement!
I would support tea party if followings are met:
1. Get tough on banks.
2. Reduce military size and expense.
3. Less religion and more personal freedom/liberty.
4. Don’t be a wing of the republican party.
“Get tough on banks.”
Read Griftopia to share Matt Taibbi’s insight that the Tea Party movement primarily serves as a political distraction from Griftocratic activities on Wall Street…
It’s was hijacked
I think initially it was a reaction to TARP
Read Taibbi’s book, Griftopia. He attributes the birth of the Tea Party movement to the Santelli rant on the CME trading floor. I see no reason Taibbi would have cause to distort this picture.
It’s was hijacked ??
No doubt about it…Gave the neocons a place to hide (they think)….
I proudly support the tea party movement!
Cool, then check out this cool song. It has a girl in a bikini at 0:28 and at 1:38 too!
http://www.youtube.com/watch?v=yVgOl3cETb4
(Oh yea, and a dude with his shirt off at 0:55)
I proudly support the tea party movement ??
Lets see who they support in the 2012 election…That will flush out exactly who the party is…My bet; neocons in a new suit…
Absolutely. They will be pro rich, pro big biz and pro war.
All that is changing will be the lip service. In the past it was abortion, gays and school prayer. The new lip service will be “less gov’t” while spending will continue to skyrocket.
Whad’ya know? Despite countless attempts at using distortionary intervention to destroy the ability of the U.S. housing market to function, the laws of economics seem to still be working — especially the economic version of the Law of Gravity!
Roubini: ‘Housing Prices Can Only Move Down’
Published: Tuesday, 28 Dec 2010 | 12:27 PM ET
Ash Bennington
NetNet Writer, Special to CNBC dot com
According to economist Nouriel Roubini, the housing market is in a double dip.
And negative Case-Shiller Home Price numbers out today only confirm that unpleasant truth.
“It’s pretty clear the housing market has already double dipped,” says Roubini. “And the rate of decline is stronger than in previous months,” he said of the new housing data.
Aside from below trend economic growth, there are two factors specific to the housing market that are putting downward pressure on home prices.
The first factor is the expiration of federal home buyer tax credits for first time home buyers.
“If you look at the data, Case Shiller has been falling every month since the tax credit expired in May. Everyone who wanted to buy a home did so by April,” Roubini said.
“That tax credit stole demand from the future and its expiration led to another 30% fall in home sales, pushing Case & Shiller lower for the last few months,” Roubini wrote in a text message earlier this morning.
The second factor putting downward pressure on home prices is the ongoing chaos with mortgage documentation, and the consequent suspension by banks of mortgage foreclosure proceedings—which has actually worsened the underlying problems in the housing market.
“There has been an effective moratorium on foreclosure,” said Roubini.
And the beginning of the end of that moratorium means more housing supply is about to become available on the market.
“The shadow inventory of not-yet-foreclosed homes—due to the moratorium—will surge in the next year,” Roubini says.
Both factors, taken in concert, set up a scenario where market fundamentals put downward pressure on prices: “Supply will increase, demand will drop,” Roubini said.
…
Okay, here’s a great example of valid information being readily available to anyone who cares to examine and scrutinize. But wait bit and you will see this information ignored or downplayed, and another group of future FBs will be spring into existence.
Okay, here’s a great example of valid information being readily available to anyone who cares to examine and scrutinize. But wait bit and you will see this information ignored or downplayed,
As were my cited facts and figures supporting the factual position that American middle-class decline was brought about much more by a broken social contract than by American’s love of debt?
bill? bill in Tampa? Can I hear an ignorant 10 word unsupported, name calling vapid sentence from you ?
According to economist Nouriel Roubini, the housing market is in a double dip.”
yes I see this on Zillow prices sold and Zestimate
Spring could be ugly what new Government actions will be taken to stop the Deflation I wonder ?
When do we do the predictions for 2011 ?
My predictions:
1) Housing transactions volume will bottom out in 2011, due to a dearth of qualified and interested buyers, beset by rising interest rates and stubborn sellers who are unwilling to lower their wishing prices to levels where a qualified and interested buyer is forthcoming.
2) Prices will bottom out after 2011, thanks to the shadow inventory and prime-ARM tsunamis layered on top of empty-nestering baby boomers over the next few years.
I thought the saying was, ‘Buy the dip’?
HOUSING
Did someone say ‘double dip’?
With all 20 surveyed cities showing price declines, S&P’s David Blitzer utters long-dreaded phrase.
Tyler Durden on Case-Shiller’s 4th consecutive miss: “If Bernanke is hoping to eventually restore HELOCs as a piggybank for the greater US population, he better come up with something quick. The Case Shiller for October, as always nearly three months delayed, shows that the double dip in home prices which started in June, is persisting. And since both new and mortgage refi apps have plunged in recent weeks following the spike in the 30 Year cash mortgage rate, do not expect to see any rise in Top 20 Composite MSA home prices. From the October print: the October SA Composite 20 came at 143.52%, a decline of 0.99% from September, and just down from a year earlier. There was a sequential decline in 18 of the 20 MSAs, with just Denver and DC posting an increase. The biggest drops were in Atlanta (-2.13%), Chicago (-1.80%), and Minneapolis (-1.76%). The decline was even worse on a non-seasonally adjusted basis, where the sequential decline in the Composite 20 was -1.32%. As the attached chart demonstrates, the double dip is accelerating, as the sequential drops are increasing in magnitude. This data flatly continues to refute claims that there is any economic recovery going on, as the primary source of middle class wealth continues to decline in value.”
“If Bernanke is hoping to eventually restore HELOCs as a piggybank for the greater US population, he better come up with something quick.”
No need to rush. Once the housing market nears a bottom by 2015 or so, private mortgage lenders will happily step up to loan to qualified borrowers.
Right up until yesterday I was daily seeing news articles crowing about how house prices have risen at a brisk rate for four consecutive months, along with rising sales. Now suddenly I am reading just the opposite. I am totally confused.
Oops, not to worry, I just read an article by our local rag’s RE editor explaining that experts predict the local market will come roaring back in 8-10 months.
http://finance.yahoo.com/news/China-shrinks-rare-earths-apf-2574493440.html?x=0&sec=topStories&pos=main&asset=&ccode=
China to reduce exports of rare earths by 10% next year. Things that make you go hmmm…
Cash and residential investment properties are not the only things the wealthy are hoarding these days. Greedy people are also hiding rare old violins from view, depriving concert artists and audiences of the chance to hear del Gesus and strads in live performance.
Strings Trade
By David Templeton
Documentarian Tim Meara gets a behind-the-scenes glimpse of the rare violin market
…
“At first, people do sort of think the movie is kind of a niche issue,” Meara admits, “but then they become captivated, as I did. It’s quite amazing to people that, instead of the tradition of a historic violin being played by new generations of players, these instruments are now seen as commodities. The idea, which has been held for years, that these great instruments belong to everyone, that idea is being lost. They don’t belong to the world, or to history, or to the world’s musicians—they belong to the world’s richest people.
“And it does change the meaning of a violin when you think like that.”
…
“And it does change the meaning of a violin when you think like that.”
Thinking “like that” has tried to change what is really important….but it can’t in the long run and it never could.
When we argue against their mammon, they lash out- call names as a child would.
To that, we should say “bring it on”….because what we say is more profound than what they feebly attempt to spout.
Corporate profits are up. Stock prices are up. So why isn’t anyone hiring?
Actually, many American companies are — just maybe not in your town. They’re hiring overseas, where sales are surging and the pipeline of orders is fat.
More than half of the 15,000 people that Caterpillar Inc. has hired this year were outside the U.S. UPS is also hiring at a faster clip overseas. For both companies, sales in international markets are growing at least twice as fast as domestically.
More than half of the 15,000 people that Caterpillar Inc. has hired this year were outside the U.S.
Caterpillar hired a lot in Brazil. Why? Because Brazil’s policies make Caterpiller give a damn if they want to make money in Brazil.
US corporations don’t give a damn about Americans because American policies don’t require them to give a damn.
And you American fools defend American corporatism that shafts Americans.
We are laughed at.
Apparently whoever claimed there could be no U.S. economic recovery without housing was wrong, as green shoots of recovery in other sectors are clearly visible now. Housing is simply going to take longer to recover, due to all the extend-and-pretend measures that were used to delay the arrival of a housing bottom.
* REAL ESTATE
* DECEMBER 29, 2010
Housing Recovery Stalls
Fresh Fall in Home Prices Is Headwind for Economy; Other Signs Still Strong
By S. MITRA KALITA
And SUDEEP REDDY
A new bout of declining home prices is threatening to hamper the U.S. recovery, just as consumers and the overall economy have been showing signs of healing.
Home prices across 20 major metropolitan areas fell 1.3% in October from September, the third straight month-over-month drop, according to the S&P/Case-Shiller home-price index released Tuesday. Many economists expect the declines to continue into at least next spring, erasing most of the gains made since prices bottomed out in early 2009.
The housing market, which appeared poised for a recovery earlier in the year, now could be heading for a second downward drift.
“This looks like a double-dip [in housing] is pretty much on the way, if not already here,” said David Blitzer, chairman of the Standard & Poor’s index committee. “Somebody who thought last year that it’s going to be straight up from here was wrong.”
Other news in recent weeks, however, has offered hope the economy is on the cusp of strong, sustainable growth. Retail sales returned to levels seen just before the recession started in 2007. Manufacturing continues to expand. U.S. exports are back to where they were just before the financial crisis.
Optimism among heads of small businesses and large corporations is also near pre-recession levels. And tax legislation that includes a one-year payroll-tax cut for most workers has boosted prospects.
…
WSJ’s Mitra Kalita discusses October’s U.S. housing price decline with Yale University economics professor Robert J. Shiller, who says the struggling housing market will likely continue to weigh on the overall economy.
Can someone please explain how and when propping up housing prices became a responsibility of our federal government? I thought they wanted to create affordable housing, not unaffordable housing.
* POLITICS
* DECEMBER 29, 2010
GOP Shifts on Fannie, Freddie Overhaul
Republicans Say Quickly Privatizing Mortgage Giants Would Squeeze Access to Home Loans and Depress Sales, Prices
By ALAN ZIBEL
Earlier this year, leading House Republicans proposed to privatize mortgage giants Fannie Mae and Freddie Mac or place them in receivership starting in two years.
Now, as Republicans prepare to assume control of the House next week, they aren’t in as big a rush, cautioning that withdrawing government support in the housing market should be gradual.
“We recognize that some things can be done overnight and other things can’t be,” said Rep. Scott Garrett (R., N.J.), incoming chairman of the House Financial Services subcommittee, which oversees Fannie and Freddie. “You have to recognize what the impact would be on the fragile housing market as it stands right now.”
Fannie and Freddie, which buy mortgages from lenders and package them into securities that it sells to investors, were placed into government conservatorship in September 2008 after they nearly failed as losses from the housing bust started to mount. Keeping them afloat has cost taxpayers about $134 billion so far, and the companies’ federal regulator estimates it could cost about $20 billion more. By comparison, the broader Troubled Asset Relief Program, which bailed out the rest of the financial industry, is projected to cost $25 billion.
Cautious statements from key Republican members of the House Financial Services Committee are a shift from the debate over the Dodd-Frank financial overhaul last spring and summer, when Republicans blasted the Obama administration for omitting Fannie and Freddie from the bill.
Republicans were backing a bill by Rep. Jeb Hensarling (R., Texas) to start cutting the government’s ties to the mortgage giants or begin winding them down in two years; if they were deemed financially viable, they would become fully private within five years.
“Of all the dumb regulation that caused our economic crisis, none was dumber than that which created the (Fannie and Freddie) monopolies,” Mr. Hensarling said in March.
Democrats tend to favor a more active role for the government in housing to ensure that underserved communities have access to mortgages.
Many Republicans now concede that a speedy exit may not be practical, because Fannie Mae and Freddie Mac have such a dominant position in the nation’s housing market. Mr. Garrett said he has “not established a specific timeframe for winding them down.”
Ever since the housing bubble burst, the federal government has been the main source of support for new mortgage lending. Fannie, Freddie along with the Federal Housing Administration and the Department of Veterans Affairs guaranteed nearly 90% of home loans made in the first three quarters of 2010, according to the trade publication Inside Mortgage Finance. A hasty end to the government’s support of Fannie and Freddie would mean fewer Americans could get home loans, causing home sales and prices to drop even further and pushing taxpayers’ cost for rescuing the mortgage giants even higher, said Rep. Randy Neugebauer (R., Texas), a former banker and housing developer who serves on the House Financial Services Committee. “You’d cause Freddie and Fannie to have even larger losses than they’d already have,” Mr. Neugebauer said.
…
From the comments section of this WSJ piece:
“Now people making $35,000 a year are buying $200,000 homes, driving $50,000 cars. They are forever burdened with debt they can’t and won’t pay.”
“They are forever burdened with debt they can’t and won’t pay.”
And the parasites at Megabank, Inc have a perpetual supply of hosts to feast on. Uncle Sam just has to figure out how to get everyone else besides the borrowers and the lenders to make up the difference between the FB’s monthly debt repayment obligations and their ability to pay, and it will all be good!
* AHEAD OF THE TAPE
* DECEMBER 29, 2010
Housing Market Is Still Facing a Blizzard
By DAVID REILLY
Housing may be in for a déjà-vu-all-over-again moment.
…
Home prices in October dropped from a month earlier, according to data from S&P Case-Shiller home-price indexes released Tuesday. That marked the third consecutive month of price falls, bringing the indexes to their lowest level since May. An acceleration in the rate of price declines prompted David Blitzer, chairman of S&P’s index committee, to declare a housing “double-dip is almost here.”
The question is whether fresh declines may bring more buyers into the market. Ultimately that would be good for housing, even if price falls prove painful.
One indication may come with Thursday’s release of November data on pending home sales. October data for such sales—which mark contract signings rather than closings—surprised with a record 10% gain. The jump was ascribed to low prices and what were then record-low mortgage rates.
But mortgage rates have risen since then. Freddie Mac last week reported an average rate for a 30-year fixed mortgage of 4.81%, well above the 4.17% level of mid-November. That raises the prospect that November figures disappoint.
In addition to higher rates and still-troublesome unemployment, legal issues swirling around foreclosures and a huge “shadow” housing inventory could drag prices down further. That in turn may complicate planned efforts for a housing-finance overhaul.
…
* REAL ESTATE
* DECEMBER 29, 2010
Faces of the Home-Foreclosure Crisis
The Tidal Wave of Defaults and Delinquencies That Began Four Years Ago Has Hit Individuals at All Levels of Society
The foreclosure crisis that erupted four years ago has claimed more than five million American homes—about 10% of all homes with a mortgage. It began in lower-income neighborhoods and has spread to some of the most exclusive addresses in the U.S.
The seeds of the crisis were planted a decade ago when banks, discovering the high returns from selling bundles of securitized mortgages, relaxed lending standards and originated millions of adjustable-rate subprime mortgages. Such loans were designed to allow just about anyone to get a home loan.
When interest rates on the adjustable-rate mortgages finally climbed, many borrowers began falling behind on their payments, leading to the first wave of delinquencies and defaults.
At the start of 2008, with the U.S. economy weakening and job losses multiplying, the defaults began to spread as millions of Americans with plain-vanilla prime mortgages also ran into trouble making their payments. In some cases, borrowers found they had paid inflated prices for homes they could no longer afford. Others got into trouble by or borrowing against the equity in their homes. According to the Federal Reserve, Americans withdrew more than $1.1 trillion of equity from homes in 2006 and 2007.
By the end of 2008, with home values plunging, one in six homeowners found themselves underwater—owing more on their homes than they were worth. Borrowers, even those with stable jobs, began to see such negative equity as a reason to stop making their payments. That triggered the third wave of the foreclosure crisis: the strategic default.
The Obama administration is working with banks to head off future defaults and stanch the foreclosure wave by modifying mortgages. The federal programs have so far disappointed. The Home Affordable Modification Program, for example, was launched in the summer of 2009 with the intention of modifying three million to four million loans. So far, it has provided permanent help to fewer than 450,000 struggling borrowers.
Here are six stories of people caught in the foreclosure crisis, by circumstance or choice—from those who fell victim to hard times to others who squandered equity on cash purchases.
The crisis looks set to continue. Another four million people are in danger of losing their homes, according to the Mortgage Bankers Association. And until foreclosures are cleared, the housing market is unlikely to recover.
The foreclosures have had a silver lining for one group of Americans: Many families locked out of the housing market during the boom can now afford to buy.
…
She is easy on the eye and she plans to go after Megabank, Inc on foreclosures. Double bonus! Gollum’s candidate, Meg Whitman, would have fallen short in both areas.
New California AG could sue banks on foreclosures
Kamala Harris, the Attorney General-elect of California is shown in this undated photograph.
By Dan Levine
SAN FRANCISCO | Tue Dec 28, 2010 6:47pm EST
SAN FRANCISCO (Reuters) - Kamala Harris takes over as California’s attorney general next week with dodgy bank foreclosure practices in her sights and lawsuits against major banks in her realm of possibilities.
For the up-and-coming Democratic star — the state’s first woman, South Indian and African American attorney general — her predecessor and California Governor-elect Jerry Brown is a model to follow in cracking down on lenders.
But while Brown scored an early settlement against banks as home foreclosures mushroomed in California, other states have been more aggressive of late. Borrower activists are hoping Harris will make the most populous U.S. state a more powerful ally against the banks.
Mortgage servicers have come under fire in recent months for abuses of the foreclosure process, prompting the nation’s 50 state attorneys general to coordinate an investigation of lenders such as Bank of America, JPMorgan Chase & Co and Ally Financial’s GMAC unit.
This month, Arizona and Nevada, two neighboring states hit very hard by foreclosures, took a more aggressive stance and filed lawsuits against Bank of America.
Harris told Reuters in an interview on Tuesday that litigation is one potential course, along with discussions with lenders.
She stressed the importance of investigating whether a lender’s conduct violated California law in a manner that should lead to litigation.
“It is a priority for me,” Harris said. “So it is something I am going to look into right away.”
…
SCENARIOS-BofA offers WikiLeaks many potential targets
By Joe Rauch
CHARLOTTE N.C. | Wed Dec 22, 2010 4:30pm EST
CHARLOTTE N.C. Dec 22 (Reuters) - WikiLeaks’ next data release, early next year, is widely expected to center on Bank of America Corp.
WikiLeaks Editor In Chief Julian Assange — currently under house arrest in England — touched off a fevered wave of speculation last month, when he disclosed the group would follow up its release of 250,000 diplomatic cables from the U.S. government in November with a look at the financial sector.
Assange has not named BofA as the target of the next release, but he said in a 2009 interview the group has five gigabytes of documents and data from the hard drive of one of the bank’s executives.
On Dec. 1, Bank of America marketing chief Anne Finucane said the company has had no evidence it is the target of WikiLeaks’ next release.
…