Bits Bucket for February 2, 2011
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.
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Name:Ben Jones
Location:Northern Arizona, United States
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Some here are posting reports without noting the source. I’m not going to let those through, or will delete them if they get through. I prefer a link, so others can go to the source and see the details. But at the very least there must to be a source included.
Up to my ears, no, eyeballs in snow.
No link — just trust me Ben!
Realtors are scum. -sorry no link.
That’s been my gripe with wmbz’s posts- they never have links.
wmbz, post a link? or read the thread before he duplicates a post for the 2-3rd time?
Oh, happy day,…
“That’s been my gripe with wmbz’s posts- they never have links.”
He puts the article’s title at the top; Google it!
Suspect you may might need to provide them with the link to Google.
Funny- NOT.
Does that mean that we can’t use the abreviation FB for FB’rs ?
Sometimes just an article’s title does not work. The news agencies very own internal search engines often fail. And if it fails, then Google can only work with what they serve up.
In other words, GIGO.
He’s already on the page; he should link it like Professor Bear does. There’s a reason Ben, and others, want links.
Wrong! 9 out of ten times if I include a link it does not go through. Do yourself a favor and just skip anything I post, I do it all the time.
The links are mostly just recycled Drudge Report headlines
Speak for yourself! My links are recycled St. Pete Times headlines.
“In Florida, the report points out the Miami Herald’s investigative work that showed between 2000 and 2007, an astonishing 10,500-plus people with criminal records entered the mortgage broker business field in Florida, including 4,065 who had previously been convicted of such crimes as fraud, bank robbery, racketeering and extortion.”
http://www.tampabay.com/news/business/banking/financial-crisis-final-report-suggests-cutting-regulation-may-haunt-us/1148757
It figures. These ex-cons can’t get regular jobs because nobody wants to hire an ex-con. So they get irregular jobs; Jobs based performance.
The bottom line is where it matters: Can one bring in the bucks or can’t he? So the guy is an ex-con, so what?
Can he convince a future FB to sign on the dotted line? Yes? Good; hire him and turn him loose on the lemmings.
No? Tough luck. Coffee is for closers and all that.
There was a selective process at work. The sleeze artists drove the straights from the field. Soon all that was left were sleeze artists, ex-cons and such who have found a heaven on earth.
I know of a guy here in Southern Calif, an ex-con, who ended up, at the RE peak, making something like $150,000 a month doing mortgages. It wasn’t just him that brought in the dough; it was him plus the crew that he had working for him.
He would hook a lemming in on a mortgage deal then he would make yearly house calls; He would visit each lemming once a year to refinance their mortgage, meaning he would enable them cash out their ever-growing home equity.
The lemmings had a new best friend, a guy that would magically turn their houses into money trees. They didn’t have to do anything other than sign a bunch a papers that he brought to them at their homes.
Once a year the lemmings scheduled their annual physicals, got their teeth cleaned, got to cash out a few thousand dollars of equity from their houses. Life was good for the lemmings and VERY good for this mortgage guy.
Has any reputable economist done an analysis of what the “wealth effect” was on increased home value at the peak of the equity extraction craze? Because my recollection is that historically it was about 10% which is fairly small considering that houses didn’t go up a lot more than inflation. But that 10% is from a time when you couldn’t get a home equity loan for anything except repairs (my parents got one when I was a kid to redo the septic system and fix the holes in the roof and there wasn’t even enough left in the loan amount to fix the non-structural cracks that the water caused in my bedroom wall). Anyway, I’d really like to know what that number is.
I think John Mauldin has some charts on this.
IIRC it was how home equity extraction added to GDP
he sends out a free weekly letter but this is old news you will have to comb through back issues
Yeah, and didn’t they call that a “second mortgage” instead of a home equity loan?
I think the two are different. You pay a home-equity loan back with your paycheck. The house is just collateral.
A second-mortgage is a refinance: you sell, cash out our home equity (% down + appreciation), re-buy, and restart the clock. If you just want to take advantage of the interest rate, you use the cash-out as the new down payment and re-start a shorter clock. But if you want the cash, you pay the whole mort again.
When I was a teen, there were whispers that a neighbor had to “take out a second mortgage” to send his daughter to college. Now it’s cruises and boob jobs.
I believe “2nd” mortgage refers to the lien position. Home equity loans/lines of credit would also be in the 2nd lien position. A refinance replaces the existing 1st mortgage with a new 1st mortgage. If they take cash out, it’s a 1st mortgage with a higher balance.
A second mortgage is just another mortgage on top of the purchase money mortgage and subordinate to it. Seems to be a mechanic’s lien or other judgment could conceivably come between the original and 2nd mortgage. First in time, first in right, except for purchase money.
i know a guy in southern california who is a mortgage broker and a crook. he started an online private money mortgage auction business in 2008 called the national equity exchange.
in 2010 i sued for fraud in los angeles superior court and this guy was referred to as my quasi brother in law. he is my girlfriend’s brother in law and has a motto of “always screw family first”
so they spent $1M mostly on paying themselves and went broke in less then 3months. the software they bought wasn’t complete nor was it debugged but they launched the auction site none the less.
they called me, telling me they had closed 40 deals but had some software issues that i needed to fix for them. it took me 7 months, with a small crew to get the site ready. it had never closed a single deal, it was too broken and there were was only 1 lender on board.
by the time i was ready to begin trading they decided to not keep the deal they made with me. as a result they were forced into bankruptcy, the creditors got nothing and i have the assets.
i have another web based company that is 14 years old and i am currently re-writing it. when i’m done in a few months i will look for a little financing and give the “hard money auction” business a try. the work is 90%+ done already i’m just too busy trying to pay the bills with my existing 2 businesses at the moment.
Take heart, people. The bad guys are starting to get their due. Here’s a data point from Tucson’s daily fishwrap:
Two indicted on mortgage-fraud charges
Key passage from the story:
A federal grand jury indicted a Tucson real estate agent and loan officer on charges alleging they conspired to obtain mortgage-loan financing using false and incomplete information.
The U.S. Attorney’s Office said Tuesday that Susan Levy, 69, a licensed Arizona real estate agent, fraudulently received about $1.2 million in loans to buy several properties between February 2006 and July 2007.
The indictment says that in obtaining her loans, which were wired from financial institutions, Levy failed to disclose that she had bought other properties, and she understated her liabilities.
Scott Tyson, 43, the second defendant named, was her loan officer in the transactions, the indictment says.
To which I say:
Yes, I know. Just two people. A drop in the bucket, to be sure. But it is a start.
“Yes, I know. Just two people. A drop in the bucket, to be sure. But it is a start.”
I think the frustration is seeing forecloses being done in bulk, even without proper paperwork, while it’s like pulling teeth to see any of the rampant fraud prosecuted.
Sometimes the U.S legal system doesn’t seem all that different from that of a banana republic, all the way up to the Supreme Court.
A quick google using ” Mortgage - fraud -sentence” results in a plethora of cases, Unfortunately most get off with a relative wrist slap. Not so for Elleni however:
The sentencing Wednesday of a 44-year-old Fox Chapel woman to three years in federal prison for fraud and tax evasion came only after a courtroom debate about who set the stage for the global financial meltdown.
Did the brokers, appraisers, attorneys and others now going to prison for mortgage fraud trigger economic losses that rippled from Main Street to Wall Street? Or were they swept up in a runaway market endorsed by the banks they are now accused of defrauding?
Elleni Klimantis Berger, who ran mortgage broker All Credit Finance, will have three years to think about that, despite pleas from her family to U.S. District Judge Joy Flowers Conti that she be spared prison so she can care for her 6-year-old son.
Her husband, Randy Berger, who has also pleaded guilty to fraud, will serve an as-yet-undetermined sentence as soon as hers is over. Her sister, Vasilia Klimantis Berger, and her sister’s estranged husband, Jay Berger, have also pleaded guilty to mortgage fraud-related charges, and await sentencing. Jay Berger and Randy Berger are unrelated, except through marriage.
Elleni Berger “stretched the rules where she worked,” said Emanuel Klimantis, her brother. “The banks enticed it in a way” by loosening lending rules, he told Judge Conti.
Ms. Berger said that when subprime lending ballooned over the course of the last decade, with adjustable-rate mortgages and loose requirements, pressure built to bend the rules.
“I did not wake up one day and say, ‘[Fraud] is what I’m going to do,’ ” Ms. Berger said. “I woke up one day, and [the market was] subprime.”
He said Ms. Berger earned an average of around $500,000 a year, reaching $846,000 in 2004. “Then she takes the extra step of ripping off the government,” by underpaying her taxes to the tune of as much as $200,000, he said.
Ms. Berger said that was due to poor bookkeeping, and said she might take accounting courses in prison.
Lol…
Read more: http://www.post-gazette.com/pg/11013/1117622-54.stm?cmpid=localstate.xml#ixzz1CpCtFXJl
It’s far more than 2. There have been news articles every day. They just don’t make national news.
I used to call the car biz a “business of refugees”. It really was a place for -anyone- to get a shot at success, no questions asked. Ex Con? No problem. Do your job and nobody asks, nobody tells. Drugs ran rampant and cash-in-fist “spiffs” (also called “momma don’t know money”) was handed out all the time to help quench the staff’s “needs” as they powered through 12-14 hour days one after another, day in, day out, weekends and holidays included.
A -lot- of those refugees found new shelter in the mortgage business. Hell, I kicked myself for not jumping ship as well. I kept telling myself that the whole house of cards was going to collapse at any second, and couldn’t bring myself to give up a -REALLY- high paying position running my little Honda internet department. I benefited by proxy thanks to all the cash-buyers taking cash out of their homes (it was a HUGE part of our business for years). Still, I bit my tongue as I watched friends rake in 20k+ per month in the mortgage biz. Little did I know the game would go on for -years-. I was almost 100% correct about what eventually happened, but I was WAY off on the timing.
Of course, most of those “friends” blew through their cash (or was it “cashed through their blow”) just as fast as they earned it. I’m sitting here able to enjoy a few trouble free years of retirement with a healthy bank account while I finish up a degree. They are back to pushing automobiles in the most oversaturated auto markets ever. They sure did build a lot of dealerships during the big housing boom. Hard to make a living on commission when you’re competing with 8 other local Honda dealers on price. What’s 25% of negative 1200$ again?
Hah.
Interesting inside story Ncinerate….Thanks
The saying “the best way to rob a bank today is to own one” is true. Ever see any top exec go to jail? How about Countrywide crooks that just ended up ” paying 25 million fine” for their 200 - 300 million profits. bonus, etc. Believe anyone would take those odds!!
Key Lime Pie will never be the same:
“Dear Customers,
This is to let you know that our company, Blond Giraffe, is out of business. We are deeply saddened that we must do this and at the turn of events that brought our company to this point, namely: two employees lawsuits, the Gulf oil spill, the dramatically drop in tourists because of the recession, the huge decrease of cruise ships in the Port of Key West which resulted in 2010 being the worst season we have had since opening the business. We want to thank all of you - our customers - for all the support you have given us over the 12 years and to let you know we plan start our business again, in the near future. Thank you again for supporting Blond Giraffe products.
Best Regards,
Tania and Roberto “
The original Key Lime groves in the Keys were destroyed by the 1935 hurricane. Most Key Limes are now grown in Mexico. I did have Key Lime Pie on Key West and it was nothing to write home about. Instead, I recommend the Key Lime milkshake from the Robert Is Here fruit stand in Homestead (at the left turn on the way to the lower Everglades). THAT was good stuff.
My sil used to serve up key lime pie made from lime bushes in her neighbor’s yard in Islemorada. Now that ’s real Key Lime Pie.
Conconut and Bougainvillea were also plentiful enough that neighbors were happy to share. Not sure they’d be so happy for a tourist to be grabbing stuff though.
Ex Goldman Sacs Boys Get Sweetheart Deal
I got this from my brother who is waking up to the reality of our housing bubble collapse.
Note that I think that you all have probably seen this already, but just in case, here is the link.
http://www.youtube.com/user/fiercefreeleancer#p/a/u/0/ssl5yb7FewA
My only thought is this: Is this how the FDIC is dealing with all of the banks that buy up the mortgage paper? If so, why aren’t they selling those foreclosed homes with haste?
“If so, why aren’t they selling those foreclosed homes with haste?”
The whisper word is that ‘banks’ are trying to avoid crashing home prices further by selling too quickly. How this could be accomplished without top-down collusion, in violation of the Sherman Antitrust Act, which prohibits price fixing (coordinated withholding of supply from the market to increase prices), is a matter of conjecture and debate.
Why would the bank care about having to sell a home for 200k when the loan balance is 300k? Wasn’t the bank made whole when they sold the loan to investors via MBS shortly after writing it?
How are the foreclosure proceeds distributed to the investors when the non-perfoming asset finally performs, albeit for less than the face value of the loan(i.e. a foreclosure is liquidated by the servicer)?
And if the investors bought the loan from Bofa at market value, do they need to be reimbursed by the bank at face value of the original investment(then the bank would take a loss) or do the investors just receive whatever proceeds are there. (Investors in the MBS’s get say 200k back when they purchased the loan for 300k)
If anyone could clarify?? I know Recontrust has 5800+ auctions pending in Clark County, Nevada, per their website but their hands are tied thru an federal judge’s injunction(according to info I found here). But injunction or no, the first one on their auction schedule has been pending since 2007, according to their Trustee’s Sale #2007-xxxxxx.
Here in Deschutes County, they haven’t executed an auction since October. I thought they were going to do a few starting today, but they have cancelled those and the next ones are “scheduled” for the 15th.
Are they sitting on their foreclosures because of robosigning NODs, etc. or also because they don’t know how to sort out the reimbursments on their liquidations? Does the servicing bank have to pony up the difference between loan and liquidation amounts? or do the investors eat the loss as they would in a stock. Even if it AAA rated, isn’t their still a risk to investors, or does the bogus rating make the packaging agent culpable and respnsible for the investors losses?
I know Oregon AG is suing Bofa for 14 million dollars in losses incurred by PERS et al, investing in toxic loans. But I still don’t know what in the heck Recontrust is up to…..Its too darned complicated and this year will be illuminating I hope.
They are. To investors with the big bucks who buy in bulk!
IIRC, some Licenses don’t have the criminal background checks like a regular Real Estate License does in Ca. I had to be finger printed and had a criminal background check. I think the Dept of Corporations is more lienent.
Because they presumably know more about contracts and real property law than the average UHS, members of the California Bar are waived in to a CA UHS license. Then if they get disbarred for ethics violations, they already have a new career lined up.
IIRC this is a pretty common occurrence.
Dennis
If you get arrested at 16 yo for mary jane, and had to go to a 4 counseling meetings as punishment, do you have a criminal record? Is that a conviction?
If there was punishment there must have been a crime..hence a conviction, yes?
Robert F. Kennedy Jr. had to do 1500 hrs of community sewrvice. Mary Jane and snort will get you every time. Google.
Beats me.
Juvenile records are generally sealed when the perp turns 18. BUT….
Somehow certain US agencies - CIA et al. - appear to be able to unseal them when they want.
YMMV.
Thanks Dennis.My niece was in a car and they had a small amt of mj in it.Fast forward… she wants a career in something that a criminal record will lock her out of.
Yeah, being young and stupid on a non-violent minor drug incident, should not be a life sentence.
non-violent minor drug incident, should not be a life sentence ??
But the fact of the matter is, that it is a life sentence at least as far as a job is concerned…
“Juvenile records are generally sealed when the perp turns 18. BUT….”
Not always…I *know* someone who will be able to petition to have them sealed (or expunged) when he is 26. Different offense, however.
You have to request to have them sealed. I don’t think they are sealed automatically. However, most background checks do not include prior to 18 years old, depending on the job.
Its very expensive to literally run everything about a person.
It’s the secret service that can unseal them if you make a threat on the president.
You MUST go to the trouble to seal your juvinille records, they are not automatically sealed, at least not in California. Its not a hard process.
She should have an attorney and request witholding ajudication. I may have butchered the spelling on that one.
If she stays clean for a period of time, the incident is completely sealed - execpt the aforementioned CIA or NSA I suppose.
Regardless, it is then ethical to state she has never been arrested for a crime.
I’m a living example of doing something stupid as a teen that otherwise would have ruined my life. It straightened me up immediately and I’ve been a tax paying citizen for 35 years since.
I was under the impression that juvenile convictions disappear. And that drug convictions that result in some sort of diversion would not be recorded as convictions if the diversion process is completed successfully.
I could be wrong on both counts.
I know someone who was denied entry to Canada due to a misdemeanor reckless driving at age 18.
I know someone who was denied entry to Canada due to a misdemeanor reckless driving at age 18 ??
Exactly….My brother is a recovered alcoholic…31 years sober…He had 3 DUI’s in the mid 70’s…He was denied entrance to Canada recently because of it…I guess thats what constitutes a criminal…
Canada retaliating for the US becoming a**holes?
We began sharing “deep background” information with Canada after 9/11. Some of this information consists of criminal background information that normally isn’t available to low-level law inforcement people in the US.
I recall reading a story about a couple who had some minor drug charge in the 1970’s. Years later they bought a vacation home in Canada. Recently they drove up to their own house and were turned back at the border as “drug criminals”.
had a criminal background check ??
What constitutes a “criminal”… ??
If there was punishment there must have been a crime ??
Really….Like the black guy that spent 20 years in a Florida prison only to be exonerated by DNA ??
There was a crime. He didn’t commit it. However, until exonerated, it would have shown up on his criminal background check.
I meant in the eyes of the law, as a technical matter. But I think you knew that.
“What constitutes a “criminal”… ??”
I know. Being a member of Congress, or a
TBTF.
Wasn’t it Mr. Black the Ex-Banker, then Ex- Bank Regulator, who wrote the book “The Best Way To Rob A Bank, Is To Own One”.
That was him! Look up his interview videos and talks. He is a great guy.
Economic Recovery Drives World Stocks Higher- Reuters
World stocks punched fresh 29-month highs on Wednesday, lifted by strong data pointing to sustained global economic recovery, continuing positive corporate earnings and easing concerns about Egypt.
I’m still try to figure out what has changed besides printing of money?
Guy from Challenger, Grey and Christmas was crowing about how wonderful it was that there were only 39,000 lay off announcements for January this year where the normal amount would be 100,000. Of course, he then admitted that the ones that were announced were largely in the government sector, and we all know those have only really just started. And that doesn’t count the private employment that is due to contracting for local and state and federal government that is going to go up in smoke once the already in force contracts expire.
Oh and then he was talking about how great it was that unemployment was down to 9.4% from 9.8% but didn’t even nod to the fact that most (all?) of the reduction was from people not looking anymore.
I think that’s the only way to be in TV. Tell the truth, go to the Internet. Happy lies, MSM is all yours.
Radio. The one thing NPR is supposed to be able to do better than commercial media is follow ups and spending enough time on a segment to actually get a full picture. I was very dissappointed.
Polly here is what i posted about Public radio:
Its past the point we should eliminate Public radio first, and give the frequencies back to the public.
PBS hogged up all the high powered frequencies back in the 60’s and 70’s so that legitimate broadcasting colleges etc. could find any space without interference to have even a 1000 w FM station……..We need to open up the band to community groups, colleges, high schools etc and go back to what the FCC really intended this band to be …. a public spectrum.. not government radio
Now for TV…eh…not much i watch…….so it doesn’t matter to me if we fund public TV….its the radio part we as a country need to get back and use since all cars home stereos, mobile devices still have FM in them.
WNCY bought their liscences from the city of New York back in the 90’s. They own them. How do you propose they be taken back? Who should they be given to? You? How many million do you have in your back pocket to pay for it?
American University owns the NPR station in DC.
NPR itself is a network and doesn’t own any of the frequencies.
A city does not issue broadcast licenses. The FCC does.
But the city had that frequency for years. Either the FCC gave it to them or they bought it, I have no idea, but the city owned it. When they owned it, if the mayor wanted to go on the radio, all his staff had to do was call and all other plans for that time slot got cancelled. Didn’t do it often, but it happened. Heck, the entire station was housed in the Municiple Building. I had a special pass so I could get into the building through a side door and didn’t have to wait in line behind all the people getting married. The station raised the money through special pledge drives and bought the rights to that frequency in installments rather than paying some small fee to the city every year.
They are ALL left leaning lib stations. However if they bring the fairness doctrine back, I suggest that we make it entirely fair by getting rid of halft the commiliberal professors at our universities ad colleges and replace them with conservatives.
Then we should also get rid of half of the fascoconservative professors and replace them with liberals - say at places like Oral Roberts University. Or are you only talking about state schools. We wouldn’t want the government interfering in private businesses, would we?
“Oh and then he was talking about how great it was that unemployment was down to 9.4% from 9.8% but didn’t even nod to the fact that most (all?) of the reduction was from people not looking anymore.”
If one were to look at total people employed and total income earned by those employed, one could easily see just how dire circumstances are now versus a few years ago. Minor fluctuations in U3 don’t begin to tell the story of what’s really happening.
I learned a lot from John Williams (Economist) of Shadow Stats. Now when I look at the BLS website, I know what I am looking at. I can pierce through the deception.
Our local HH Gregg is advertising a 46″ Samsung for $499.00 down from $699.00 so I am sure they will sell a bunch.
Flat screen TVs are getting cheaper ahead of the Super Bowl
cnnmoney
If you’re looking for a flat-screen TV deal, this week is a good time to buy — but extreme bargain hunters may find even better deals next month.
The week before the Super Bowl typically brings sales of up to 10% off the listed price for flat-screen TVs, as manufacturers try to lure in viewers eager to watch the big game on a new screen, according to research firm DisplaySearch.
But tepid holiday sales this year have left TV set makers with excess inventory they’re eager to shed. That means discounts this week could be as big as 20% to 30%, said Paul Gagnon, director of TV research at DisplaySearch.
Not this past Christmas, but the one before that and the one before that, the Washington Post had an early December on-line chat with some dude from and electronics retailer/manufacturer assiciation. Both times, he declared with absolute finality that it was THE year to buy a huge flat screen TV because prices had reached a place where they just couldn’t go any lower. I hope that they skipped the chat last year because someone in the Style section of the Post decided that his obvious lying was so over the top that it simply didn’t fit in with the standards of their paper.
I hope.
What about after the superbowl? Another 20% down?
A few superbowls from now they should be free.
Neighbors across the street (mostly college kiddies) have this big-arsed big-screen teevee in their living room. Even with their curtains closed, I can see what’s on. (They have a real penchant for action movies.)
Any-hoo, I’ve gotten up in the wee hours of the morn to do things like use the reading room or raid the refrig. I’ve taken a gander out my front window, and, more often than not, that teevee is on. And sucking up the Tucson Electric Power.
Meanwhile, the exterior of the house is decaying, and far be it from them to clean up the yard or pick up the litter. Matter of fact, when I was putting my trashcan/recycle out during the 6 a.m. hour, I policed their side of the street and put the litter in *my* trashcan.
If they shut that teevee off for a little bit, say, maybe an hour, they could go outside as a group and get their yard/the house exterior looking shipshape.
College kids don’t understand that it is their responsibility to do it. Most have never had to do anything without being told.
I still remember the epiphany when I returned home from college and realized that I should do the dishes just because I was there - that it shouldn’t have to be my mother’s job and that she shouldn’t have to ask.
Good point, Happy. This past weekend, I passed the time doing spring cleaning.
Yes, I know. It’s still January. But the next couple of months will be filled with many other activities. Hence, housecleaning now.
While I was cleaning my studio within an inch of its life, I saw the daddy of one of the kids for whom this house was bought. He lives a few miles away, in a veddy-veddy nice neighborhood near the University of Arizona.
I couldn’t see what he was doing over there, but I figured he was there to do some repair, maintenance, cleaning, or what have you. He’s the only one in the family who stoops to do that sort of labor.
I’m guessing that Samsung TV is probably a power-hogging plasma set.
I thought Samsung is mainly a LCD panel company. There is quite a bit more electronics in a plasma TV versus an LCD one. And most components inside LCD sets come from just a few vendors.
You know, I’m a power hog….
I’ve always liked electronics - I’ve got my house wired up every way you can imagine. I also have some eclectic tastes (like the 24″ sony trinitron CRT that I still use as my main computer monitor - to this day no flat panel can compete on color accuracy and looks, I don’t -care- if it burns through enough power to light a small village in africa). I’ve got my big old TV and a whole assortment of energy guzzling items plugged in at this very moment. To top it off, the wife is a freaking polar bear and likes to keep the A/C running 24/7 365 days a year. I guess I’m not very “green” in at least that aspect of my life.
I pay the bill though, so I fail to see the issue. It’s not like my house is going to overload the palo verde nuclear plant. Why should I give up my gadgets that I’ve earned and pay to maintain? They make me happy and I can afford my excess… Of course, if I was in a monetary crunch I’d be the -first- to cut back (I cycle-commuted for YEARS because it made financial sense over buying a second car).
As usual ‘conventional wisdom’ is wrong. And has only become conventional wisdom thanks to America’s highly effective, and well-funded, right-wing spin machine.
In Norway, startups say ‘ja’ to socialism
Inc. Magazine
Since the Reagan Revolution, which drastically cut tax rates for wealthy individuals and corporations, we have gotten used to hearing these sorts of announcements from our leaders. Few have dared to argue against tax cuts for businesses and business owners. Questioning whether entrepreneurs really need tax cuts has been like asking if soldiers really need weapons or whether teachers really need textbooks—a possible position, sure, but one that would likely get you laughed out of the room if you suggested it. Or thrown out of elected office.
Americans as a whole paid the ninth-lowest taxes among countries in the Organization for Economic Cooperation and Development, a group of 34 of the largest democratic, market economies… Only two countries in the OECD—Chile and Mexico—pay a lower percentage of their gross domestic product in taxes than we Americans do.
But there is precious little evidence to suggest that our low taxes have done much for entrepreneurs—or even for the economy as a whole. “It’s actually quite hard to say how tax policy affects the economy,” says Joel Slemrod, a University of Michigan professor who served on the Council of Economic Advisers under Ronald Reagan. Slemrod says there is no statistical evidence to prove that low taxes result in economic prosperity. Some of the most prosperous countries—for instance, Denmark, Sweden, Belgium, and, yes, Norway—also have some of the highest taxes. Norway, which in 2009 had the world’s highest per-capita income, avoided the brunt of the financial crisis: From 2006 to 2009, its economy grew nearly 3 percent. The American economy grew less than one-tenth of a percent during the same period. Meanwhile, countries with some of the lowest taxes in Europe, like Ireland, Iceland, and Estonia, have suffered profoundly. The first two nearly went bankrupt; Estonia, the darling of antitax groups like the Cato Institute, currently has an unemployment rate of 16 percent. Its economy shrank 14 percent in 2009.
Moreover, the typical arguments peddled by business groups and in the editorial pages of The Wall Street Journal— the idea, for instance, that George W. Bush’s tax cuts in 2001 and 2003 created economic growth—are problematic. The unemployment rate rose following the passage of both tax-cut packages, and economic growth during Bush’s eight years in office badly lagged growth during the Clinton presidency, before the tax cuts were passed.
It snowed last night. The sun rose this morning. Cause and effect.
Yes, it’s all just a coincidence. Return to viewing Dancing with the Stars. The Kochtopus, not some socialist rag like INC. magazine, will surely let us know if there’s any link between low-tax regimes and declining economies.
opening line of the article:
“We venture to the very heart of the hell that is Scandinavian socialism—and find out that it’s not so bad. Pricey, yes, but a good place to start and run a company. What exactly does that suggest about the link between taxes and entrepreneurship?”
I have to say that if I were starting a business and someone gave me a choice of paying a bit more in taxes when I finally managed to get profitable or having to either provide health insurance at the outrageous rates that small companies pay or do all my hiring from people who don’t care about having insurance or who have a spouse or parent that can provide them with health insurance, it wouldn’t even be a close call. No one loves to pay taxes, but health insurance? That is really nasty.
No one loves to pay taxes, but health insurance? That is really nasty.
Especially when health insurance has devolved into little more than a protection racket.
And especially when you know health insurance will rise faster than taxes. Taxes are more predictable.
And unlike rates an insurance company charges, a politician might actually pay attention to a rant about being overcharged on taxes.
I lived in Denmark a long time ago, when it was even more socialist. On the good side, there was a very high level of service provided. Public transit that ran all night long, urban planning, and high levels of social programs for health, education and unemployment. The bad side was taxes as the minimum rate at that time was around 49% and a large number of people who took advantage of the social programs.
That being said, there was accountability in the government and it was easy to see that tax money was put to use. Danes were, and still are, highly educated. Even the bums speak three languages. Danes seemed to be happy as they had choices in occupations and did not fear if they had an accident or sickness. This has led to a very productive society.
Would it work in the USA? Doubt it. There is an inherent sense of fairness built into the Danish system that would not transfer to the US.
Norway, which in 2009 had the world’s highest per-capita income, avoided the brunt of the financial crisis
Made me laugh.
Think oil, as in Alaska.
Global Warming.
In my neck of the woods, it snowed A LOT last night. Still snowing.
In my neck of the woods, it’s hot as b@lls.
heh-heh
The most surprising thing in this article is that it was written by Inc. Magazine. Of all magazines you would think they would want lower business taxes.
i read this article - very interesting. The society doesn’t necessarily LIKE paying taxes (who does) but they value them because they get so much from them. It was a good read.
Tax revenue should go for the Majority benefit ,not the rich ,not the Banks ,not the Investment houses ,not Corporation Monopolies .
Interesting on Morning Joe this morning they were talking about
the Bail Outs and the blame and they were saying that it was Wall Street Banks/Investment Houses that created the crisis . I have said this all along that it was’t really F&F that did it . This has all
been PR to take the heat off Wall Street . They were saying that
Money Changers should not of been bailed out and allowed to resume their power which is corrupt with their casinos . Now Main Stream News is talking about how misplaced these bail-outs were .
I submit we should get the money back and prosecute as we should of from day one when this crash started . These Power Brokers have just gone on to abuse the money and the power .
How incompetent can our Politicians be that they gave billions to
a fake Treasury Sec. from Goldman Sakes ,(Hank Paulson ) just based on him screaming “FIRE”. Now the corrupt casinos are still alive and it’s affecting the World .
“I have said this all along that it was’t really F&F that did it . This has all
been PR to take the heat off Wall Street .”
Dead on as always, wiz.
“The society doesn’t necessarily LIKE paying taxes (who does) but they value them because they get so much from them. It was a good read.”
And due to growing cronyism, we probably get even less done with the relatively limited taxes we do pay. That doesn’t even account for the financial black hole of the war/”security” industries.
linkster: http://www.inc.com/magazine/20110201/in-norway-start-ups-say-ja-to-socialism.html
Alpha, If you would like we could set you up to make additional donations to the government via the IRS. This would truly stimulate new buisness starts!
Ouch! Devastating delivery of a Kochtopus Talking Point. You’ve been well-coached, my friend!
Better dead than red. The global communits are making their move. Bring back the HCUA before it’s too late!
“mister we could use a man like Joe McCarthy again…”
“Norway is also full of entrepreneurs like Wiggo Dalmo. Rates of start-up creation here are among the highest in the developed world, and Norway has more entrepreneurs per capita than the United States,…”
It makes sense. The safety net in Norway is such that you can take the risk.
Our safety net produced Banksters. Not sure where Norway will end up.
Then again, the whole safety net gives entreprendre a new meaning doesn’t it?
Less than 5 million mouths to feed and the world’s 4th largest exporter of oil and natural gas….now that’s one heck of a safety net. Socialism is so easy in boutique countries that drill.
I once visited Norway, and they are not too receptive to Americans. In a meeting, they were discussing the upcoming migrations of groups, and were brainstorming ways to “help” groups migrate from country to country. I said that such a plan would NOT go over well in America. They were very condescending toward me after that.
“Socialism is so easy in boutique countries that drill.”
OK. That might explain Norway. Now explain Finland, Sweden, Denmark, Canada, Belgium, and Germany.
I think the answer is partly that healthcare and government services don’t scale very well. They do to a point (small town vs city), but soon the people who need major services are going to outweigh the inputs of those contributing unless the society is healthy or the dollar inputs are high.
“healthcare and government services don’t scale very well. ”
Canada, France, and Germany are small countries? What’s the cut-off point where it doesn’t work? Conveniently in-between the numerous countries where it works quite well, and us?
But there is precious little evidence to suggest that our low taxes have done much for entrepreneurs—or even for the economy as a whole. “It’s actually quite hard to say how tax policy affects the economy,” says Joel Slemrod, a University of Michigan professor who served on the Council of Economic Advisers under Ronald Reagan. Slemrod says there is no statistical evidence to prove that low taxes result in economic prosperity.
I’ve yet to meet Dr. Slemrod during my trips back to Ann Arbor. But if I do, it’ll be hard to keep from kissing him. I just so agree with that man on this and other issues.
Any-hoo, I’ve avoided the econ department at U-M. Why? Because I didn’t conform to their “work in government, academia, or FIRE sector” meme. (Thanks, but no thanks. I’m having too much fun as a designer/photographer.) Thus, I am not welcome around there.
Low taxes don’t do much for businesses. Now, tax loopholes is something else. To twist the words of Patton: you don’t become successful in business by paying taxes. You become successful in business by making the other son of a b businesses pay your taxes for you. [while you reap the rewards of the uncorrupt society that taxation buys.]
Our ‘REAL’ unemployement number is over 15%. Williams at Shadow Government. Our real CPI is over 7%. Williams at Shadow Government.
The Brothers Koch: Rich, Political And Playing To Win
http://www.npr.org/templates/story/story.php?storyId=129425186
Thanks to the poster who introduced the Koch Brothers to me.
“RANCHO MIRAGE, CA — A phalanx of sheriff’s deputies with riot gear fended off protestors and blocked all access to one of southern California’s most luxurious resort hotels on Sunday as more than 200 conservative donors gathered inside to plot political strategy and raise an estimated $30 million for the 2012 election.
House Majority Leader Eric Cantor was among several members of Congress who flew in for the two-day event…
The Kochs were planning to raise at least $30 million from donors attending this weekend’s event, the fundraiser said.
Much of the funds pledged this weekend by donors, however, may never be disclosed publicly because they will be directed to politically oriented non-profit organizations, like the Koch-backed Americans for Prosperity, that — thanks to last year’s Supreme Court ruling in the Citizens United case — are now much freer to run political attack ads without publicly reporting their contributors.
‘The purpose of this conference is to discuss solutions to our most pressing issues and strategies to promote policies that will help grow our economy, foster free enterprise and create American jobs,’ Nancy Pfotenhauer, a spokeswoman for Koch Industries, said in a statement about the event.”
www DOT msnbc.msn.com/id/41348611/ns/today-today_people/
——
The Koch’s depended on secrecy. Looks like the cat is out of the bag.
Secrecy?
Why is there a big banner frame with “David Koch” on it at the beginning of each episode of PBS’s Nova?
Why isn’t there a big banner saying ’sponsored by the billionaire Koch brothers’ at the beginning of Tea Party ‘grass roots’ events?
Perhaps they choose where and when they want to be known as sponsors.
+1 Alpha.
“hoc tui splat!” (In Montana™)
Ha, a “TrueDeceiver’s™” slap-in-the-blahblahblaher’s-face!
BWAHAHAHicHAHAHicHAHAHAHAHicHAHAHic* (DennisN™)
Sorry DennisN, wrong thread, S/B to “nickpapageorgio” down below:
:-/
Koch-backed: “We UltrawealthyAmericans for Our Prosperity” Inc.
Enough of the BS. Who poses a greater threat to our constitution, a couple of Libertarian Benefactors or George Soros and his merry band of Marxist revolutionaries and anarchists? Wake up.
“Enough of the BS. Who poses a greater threat to our constitution, a couple of Libertarian Benefactors or George Soros and his merry band of Marxist revolutionaries and anarchists? Wake up.”
The Koch brothers pose the greater threat, hands down.
The Koch brothers pose the greater threat, hands down.
If you are Marxist revolutionary looking to overthrow the constitution, I guess the Koch brothers would pose a greater threat.
Man, all this yammering about communists and marxists is so 1950’s. The real enemies of America are the huge corporations and the people who run them. Wake up!
“If you are Marxist revolutionary looking to overthrow the constitution”
Or an ordinary, over-the-hill, middle class centrist looking to survive in a declining economy. One of the 2.
You just lived through seeing Wall St. almost destroy this country and yet you’re blaming Soros?
Really? No. Really?
Correct me if I’m wrong but Soros and his hedge fund friends have benefited and made their billions in the rigged game that is Wall Street. He has speculated to the detriment of others on anything you can think of, currencies, MBS’, stocks in key industries, etc.
Soros=hedge fund mogul=Wall Street scumbag. Ergo he is a big part of the problem.
He uses the politicians he buys to make more money for him and his investors. If he felt he could make more money supporting the Repubs, he would. The liberal Democratic dogma is just convenient and very beneficial to his checkbook. He realizes both parties are esentially the same.
This George Soros ? This is the best you left-wing boogey-man you guys can come up with?
from wikipedia
“In 2003, former Federal Reserve Chairman Paul Volcker wrote in the foreword of Soros’ book The Alchemy of Finance:
George Soros has made his mark as an enormously successful speculator, wise enough to largely withdraw when still way ahead of the game. The bulk of his enormous winnings is now devoted to encouraging transitional and emerging nations to become ‘open societies,’ open not only in the sense of freedom of commerce but—more important—tolerant of new ideas and different modes of thinking and behavior.”
The link, Colonel Klink!
http://en.wikipedia.org/wiki/Soros
I wonder what Volcker would write in the forward to a book on the Koch Bros?
‘Hoc Ptui’? (tm HWY)
I don’t care about his politics, nor does he probably. He is however one of the Wall Street manipulators. His speculations on the market are no better than Goldman, Lehman, Bear Stearns, LTCM, SC Capital, et al. Very little redeeming quality in what they do.
Almost? I think the jury is still out on that one.
If the Cubs fail to get to the World Series for the 103rd consecutive year, will it be the Koch brothers’ fault?
yes
M&A, strong earnings send REITs through the roof
BOSTON (MarketWatch) — Merger talk centered on real estate investment trusts pushed exchange-traded funds tied to the sector to fresh recovery highs, shaking off most concerns that commercial real estate could be the next shoe to drop after the credit crunch.
[excerpts] SPDR Dow Jones REIT ETF registered a 52-week high last week after ProLogis confirmed media reports they are in merger negotiations….The fund has recouped about half the losses it suffered in the 2008 financial meltdown.
Growing middle classes in China, India and Brazil are creating new opportunities…“In the near term, we expect acquisitions will be the primary growth vehicle for many REITs,” analysts at Keefe, Bruyette & Woods said in a Jan. 24 note.
Investors’ hunger for income and their struggles with low bond yields may be driving some of the interest in REITs…
Other analysts say REITs could cool somewhat in 2011 after their solid run. Two consecutive years of returns in excess of 20%, the sector “will take a breather” and “will come down back to earth” this year, Jefferies & Co. analysts wrote in their outlook. They’re estimating a return of about 6% for the REITs they cover… rising interest rates will be a headwind.”
Indeed, hundreds of billions of dollars of commercial real estate mortgages need to be refinanced in coming years. Default rates have been rising after the credit crunch, while occupancies have fallen. Some bears are predicting a looming shakeout similar to the housing bust on the residential side.
“During the past decade, REITs benefited from increasing leverage, lower borrowing rates, rising property values, and strong growth in demand for properties,” Timothy Strauts at Morningstar said in a recent analyst profile on Vanguard REIT ETF.
——-
So let’s review: CRE loans have yet to refinance (red flag), defaults have just begun (big red flag), and interest rates are set to climb. I do not think that China and India will be as receptive to being acquired as investors think, and from what Rio says on HBB, I suspect that Brazil will not be receptive at all. In other words, REIT fundamentals are on the downhill, without anything to pick up the slack.
And so, it appears that CRE REITs have resorted to gaining returns by cannibilizing themselves with mergers and acquisitions (read: layoffs), and accounting tricks playing with interest rates and the like. They are doing this fast in order to fool investors into thinking REITs are a good return, and in order to attract new shadow cash.
ISTM that CRE is in “falling knife” stage.
Still, the feeder roads to FedCash are open as far as the eye can see.
Make sense that REITs - the “virtual” commercial RE world can have a strong “recovery” based on Fed casino injected cash, while reality is vacant rotting property.
I read up on CRE mortgages a while ago. Unlike residential mortgages, there are virtually no 15 or 30 year CRE mortgages. Instead they are all 3 to 5 year mortgages, non-amortizing, with a balloon payment at the end.
A re-fi isn’t a nice thing to have: in CRE it’s mandatory or you default. The CREFB either has to bring money to the table if he’s underwater, or face default. And CRE is generally recourse unlike residential RE which may or may not be recourse depending upon the state.
Unlike residential mortgages, there are virtually no 15 or 30 year CRE mortgages ??
All CRE/SBA loans are fully amortized DennisN….
How can it be amortized if it’s got a balloon payment?
And I hope that CRE doesn’t look to the gov for a HAMP. CRE doesn’t have the “keep children in their homes” caché of residential RE.
Ask which banks would be hurt, not what the slogan might be.
How can it be amortized if it’s got a balloon payment ??
CRE/SBA loans “DO NOT” have balloon payments…The SBA portion is fully amortized over 20 years and the underlying 1st with the bank is fully amortized over 25 years…
OK then, if all this CRE was built and bought with such low interest rates in 2005, then what are these FCB’s going to refinance into?
I know a family who is heavily involved in CRE in California. They use long term triple-net leases while the original owners, usually a syndicate, maintains their Prop13 low tax rate. FWIW, this family has had a tough time as their tenants, retail businesses, have fallen on tough times too.
FWIW, this family has had a tough time as their tenants, retail businesses, have fallen on tough times too.
Yipes! We need a Keep Retailers in their Stores program!
“there are virtually no 15 or 30 year CRE mortgages. ”
I thought the same thing, but I was assured by a commercial realturd just the other night that there were indeed 30 year mortgages for CRE. Maybe our information is dated?
Has anyone test driven an electric car and tested the air conditioner? Seems to me it would drain the batteries pretty quickly?
The ads for these cars don’t seem to discuss this issue?
Anybody know?
No idea, Spook, but it is an interesting question. We may be going back to the era of rolling the windows down during the summer.
Growing up in the Northeast, we didn’t have a car with AC until the mid 1980s. The first couple of years I lived in Florida, my vehicle had no AC. I chose my clothing carefully to minimize the appearance of sweat stains.
Heater too.
And while you can dress warmly, that won’t defrost the windshield.
When I had a 69 VW bug in Montana, I learned to breathe very slowly and shallowly at a downward angle to avoid fogging the windshield in the winter.
69? Oh one of those newfangled jobs with a gas gauge, 12 volt electrical system and all the other new-fangled gegaws.
Oh yah. It was fancy! Of course, I had to unhook the battery to keep it from draining, there was a piece of wood in the engine compartment wedging a cylinder in the engine, and gas gauge was like the Pope’s testicles. (Strictly ornamental.)
Huh. I keep hearing about the old VW heaters… I had a ‘67 bus and a ‘73. The heaters were fine, or as good as anything I’ve had since.
The bug’s heater channels ran under the running boards and rusted out in about 30 seconds after the first rain storm. The buses didn’t have that problem since the engine was up front. I believe the original bug design didn’t have heaters at all and they had to install them after the fact to sell them in the U.S. market, and running the heating channel on the exterior of the underside of the car was the design that was picked.
How big of a drain on gasoline powered car does A/C have? IIRC A/C robs a gas engine of a few horsepower when it runs.
I suppose that it will have an effect on all electric cars (just as running the heater in the winter would).
How much? I’m guessing that it would cut the range 10-20%, but what do I know? Still, I could see why vendors would rather not talk about it.
A/C has got to just demolish the battery.
These guys are working on the answer about lithium battery life:
http://newsdesk.umd.edu/universitynews/release.cfm?ArticleID=2302
The A/C does cut down the gas mileage, but so does rolling down the windows. The aerodynamic drag goes up with the windows down. Each car has a speed above which it’s more efficient to run the A/C than roll the windows down. IIRC it’s around 50 mph for the average car.
The heater part of a gas car makes use of otherwise wasted engine heat. You just route hot coolant through secondary radiators in the passenger compartment.
Someone said the other day that LED headlights wouldn’t work in conditions of snow and ice. Actually on a gas car it would be easy to run a coolant line around the headlight bucket to keep things clear in freezing conditions.
I did a fairly extensive search on the web this morning and was unable to come up with an answer. There was an interview with a GM exec who refused to state what the likely range penalty would be.
A 10 to 20% reduction in range is likely on open-road driving. In stop-and-go city driving it’s probably more like 30 to 40%.
“Boss, I won’t be in until this afternoon. I forgot to recharge my Volt last night.”
I believe the Volt is a plug-in hybrid with a gasoline engine for charging when necessary. It would take a hit in the mpg, but would do fine as long as the tank has gas.
Nissan Leaf is another story. The Prius now has an optional solar-paneled roof that ‘helps’ run the A/C. Expensive option, but I see alot of them. Many people buy them to make a statement, with the extra battery juice just a cool side benefit. It would be an interesting addition to the Leaf if Nissan thought people would pay extra.
A friend has a hybrid Civic. The air conditioning somehow works when the gasoline motor shuts off. So I assume it’s all electric. He asked me to help install an amp and a subwoofer in the car. I made him research it first. The 12 volt battery under the hood looked like a lawn mower battery. In the end it worked. *shrug*
A/C compressors on new cars only draw about 2-3 horsepower, or thereabouts.
Someone (I believe it was Ford) ran wind tunnel tests on this very scenario. The drag created by having the windows down required much more engine power to overcome than the piddly 2-3 horsepower the a/c compressor needed.
Another FYI they found…….putting the tailgate down on a pickup truck actually INCREASES drag, vs. leaving it up. When the tailgate is up, it creates a high pressure area behind the cab/in the bed, and the high pressure smoothes out the airflow from the trailing edge of the cab to the top of the tailgate. Tailgate down creates a turbulent air pocket right behind the cab. Those “cargo nets” you see that some have installed instead of tailgates are actually a “worst of both worlds” solution.
Best drag numbers were with a flush topper installed over the bed. The biggest/closest to the pavement air dam, as far forward as you can mount it under the front bumper, also helps the aero numbers.
That was me wondering about LED headlights, good idea Dennis. There is waste heat from an electric motor too, so this appraoch could work on an all electric I imagine.
DennisN, you are both an engineer and a patent attorney. This is a good idea. Why not take the next step?
Most electric cars have heated and cooled seats, which engineers have found are more efficient and make the body ‘feel’ hotter or colder (whichever is necessary) than air blowing haphazardly inside the cabin. Why all cars don’t yet have them is a good question.
The newer versions of the Prius have some solar panels on the roof to assist the AC, but on all the electric/hybrid cars I’ve been in, the heater and AC are nothing to write home about.
Why is it folly for Zimbabwe to print money and wisdom for the US to print money?
List of countries ordered by public debt:
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2186rank.html
List of countries ordered by external debt (Wikipedia has lists ordered by percent of GDP):
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2079rank.html?countryName=Gaza%20Strip&countryCode=gz®ionCode=me&rank=148
Because its got elecrolytes?
Good one.
Because its got elecrolytes?
it’s what plants crave
So true it’s almost not funny.
According to the second list, most of the so called developed countries are deep deep in debt.
Debt is money??
“Why is it folly for Zimbabwe to print money and wisdom for the US to print money?”
According to the lists you provided, Zimbabwe has more public debt as percentage to GDP than any other country, whereas the US is ranked 36th in public debt to GDP. We owe a much smaller percentage than say, perennial-Cato-Institute-fave Singapore, which is ranked 10th.
So if, indeed, public debt is going to start destroying economies, as we are warned repeatedly by some, then we’ll have a whole lot of ‘heads-up’ as the 35 countries with more debt than us go down first.
Compared to most of the rest of the developed world, the US really doesn’t have that high a debt burden.
Here’s a list of countries ranked by “external debt as a percentage of GDP”:
http://en.wikipedia.org/wiki/List_of_countries_by_external_debt
Implications? They’re both a house of cards I suppose.
They may be houses of cards, but once again we’re nowhere near the worst nations’ debt levels, including many developed nations, including many countries that are cheerleaded by the Cato Institute/Kochtopus- ie Hong Kong, with over 3x our debt level. Really, all these lists show is that we’re no where near the debt levels of most other developed countries.
Who are investors going to leave us for? Senegal? Compared to most other countries, we’re the ‘gold standard’.
99% of lawyers give the other 1% a bad name…
————————–
Bet on Foreclosure Boom Turns Sour for Investors
NY Times | February 1, 2011 | By JULIE CRESWELL and BARRY MEIER
David J. Stern may be the best-known beneficiary of the foreclosure boom, having made millions in recent years from evictions processed by his law firm, the largest of its kind in Florida. But when he took part of his firm public early last year, he had plenty of help from a constellation of investors also looking to cash in on people losing their homes.
Early in 2010, the back-office processing operations of Mr. Stern’s law firm were converted into a publicly traded company called DJSP Enterprises. Mr. Stern pocketed nearly $60 million from that transaction, public filings show.
Behind that big-money deal was a curious cast of characters, including some with previous run-ins with regulators. Other parties included a small Wall Street investment bank headed by a former presidential candidate, the retired Gen. Wesley K. Clark, and a little-known private equity firm based in New York.
As the Florida attorney general’s office continues to investigate whether Mr. Stern’s law firm falsified documents in order to speed up foreclosures, the firm has lost its biggest clients, including Citibank and Fannie Mae. Many of DJSP’s executives have left the company, and it has laid off about 80 percent of its 1,200 employees.
Meanwhile, investors in DJSP are not doing any better. Shares of the company, which were worth $14 apiece last summer, trade now for about 50 cents on the Nasdaq exchange.
DJSP faces a lawsuit from investors who claim they were misled about its financial prospects, an accusation the company has denied. Separately, former employees of DJSP who performed back-office work related to Mr. Stern’s law firm have sued, contending that the company failed to follow federal regulations in laying them off; the company filed a motion to dismiss the claims.
I’m in Greensboro this week on bidness, and I’ve noted a stark change from the feel I got here in early December.
Both nights out for dinner have been in nearly empty restaurants, the airport was dead.
In short, it is great, (or at least less bad) to travel on business during an economic downturn. If there is a recovery out there I’m not seeing it.
On an unrelated note, I heard a really astonishing story yesterday from a first hand witness with regard to the intellectual prowess of Turbo Tax Timmay. I hesitate to recount it because my doing so might harm the source but suffice to say that he showed less knowledge of the markets than you average wall street puke.
dude, you are such a tease. Now I _REALLY_ want to hear this story. Is there any other way to obscure the identity of the first-hand witness?
I’ll need to think about that a bit. Maybe I can tell it another day as, “A long time ago in a galaxy far far away…”
The Libertarians still don’t get it….
http://www.thedestinlog.com/news/party-16660-meeting-clear.html
One man that Braden asked for help from was stock trader and former CEO of MCSNet, a regional Chicago area networking and Internet company that operated from 1987 to 1998, Karl Denninger. He runs the website market-ticket.org.
Denninger, who is an original organizer of the Tea Party, recommended that the party focus on the economy as a central issue, using the slogan “Stop the Looting, Start Prosecuting” as a battle cry for Libertarian politics in 2012.
In one of his latest posts on his website, Denninger had this to say about his slogan and Braden’s response: “It was politely received, but there was no indication that either of the leaders understood what I was talking about, and why it would work.”
He went on to say that “if the Party has a better idea, or any idea at all, then perhaps there’s something else to consider. The problem is that neither of them did …”
“Denninger, who is an original organizer of the Tea Party”
And here I thought the Tea Party was a decentralized grass-roots movement born out of collective frustration of thousands of mom-and-apple-pie full-blooded Merkins.
…. merkins…. lmao.
“and here I thought the Tea Party was a decentralized grass-roots movement born out of collective frustration of thousands of mom-and-apple-pie full-blooded Merkins.”
Oh, you mean the TeaKoch Party?
The New Yorker
At the lectern in Austin, however, Venable—a longtime political operative who draws a salary from Americans for Prosperity, and who has worked for Koch-funded political groups since 1994—spoke less warily. “We love what the Tea Parties are doing, because that’s how we’re going to take back America!” she declared, as the crowd cheered. In a subsequent interview, she described herself as an early member of the movement, joking, “I was part of the Tea Party before it was cool!” She explained that the role of Americans for Prosperity was to help “educate” Tea Party activists on policy details, and to give them “next-step training” after their rallies, so that their political energy could be channelled “more effectively.” And she noted that Americans for Prosperity had provided Tea Party activists with lists of elected officials to target. She said of the Kochs, “They’re certainly our people. David’s the chairman of our board. I’ve certainly met with them, and I’m very appreciative of what they do.”
Read more http://www.newyorker.com/reporting/2010/08/30/100830fa_fact_mayer#ixzz1CoYK8qU0
The tea party has all of you communists quaking in your boots. Kind of like the end of the Scooby Doo cartoons. “Blast, we could have instituted all of our plans if it had not been for those darn tea party activists.”
No kidding. Commies dunno whether to gnaw the rug or start projectile vomiting whenever the tea party is mentioned, LOL.
I don’t think it’s so much the tea party, but the fact that they’re sort of a third party movement, which severely disturbs the status quo one party, two branch system.
tea party my a$$….Your the same bunch of neocons that helped run this country into a ditch with Bush/Cheney and all the forced Dogma you tried to cram down the country’s throat…
(Apologize in advance for the length Mr. Ben…)
Oh, you mean the “TrueTeaKoch™” Party?
Well, here’s something for you “TrueBeliever’s™ / “TrueDeceiver’s™” Yell/Holler/BlahBlahBlahTalkover’s to ponder:
Food Stamps are destroying America, …in “other” news, …“TruePurrrityyy™”! Persian Cat fights with a “TrueAnger™” Sphynx kitten!
Meeeeooow, hissssssssssssssss, Meeeeooow, hissssssssssssssss, Meeeeooow, hissssssssssssssss, Meeeeooow, hissssssssssssssss,
(Fur Flying: #$@!^####!!!#$@!^####!!!#$@!^####!!!#$@!^####!!!)
Give back the 2010 party dress, we only “loaned” it to you, peon Pee Party “TrueReducetheDeficitNOW!™” troubled child.
Hands off the zipper “TrueHypocrite’s™”!, we’re wearing it until “WE” decide to give it back! States Rights! = Loaners Rights! States Rights! = Loaners Rights! States Rights! = Loaners Rights!
Republicans Split Over Plans to Cut Defense Budget:
By ELISABETH BUMILLER and THOM SHANKER / Robert Pear contributed reporting
Published: January 26, 2011
(“TruePurrrityyy™”! Persian Cat):
The cacophony of Republican voices on military spending has bred confusion on Capitol Hill, among military contractors and within the military itself, where no one is exactly sure what the members backed by the Tea Party will do. It also shows why taking on the military budget will be so hard, even though a widening deficit has led the president and the leaders of both parties to say this time they are serious.
But Representative Chris Gibson, a Tea Party-endorsed freshman Republican and retired Army colonel from New York’s Hudson River Valley, made clear that no part of the Pentagon’s $550 billion budget — some $700 billion including the wars in Iraq and Afghanistan — was immune.
Those differences were on display Wednesday on Capitol Hill, where the traditional Republican who now leads the House Armed Services Committee, Representative Howard P. McKeon, fought back against proposed cuts in the Pentagon budget even as fledgling committee members supported by the Tea Party said that the nation’s debts amounted to a national security risk.
WASHINGTON — To hear the Republican leadership tell it, the once-sacred Pentagon budget, protected by the party for generations, is suddenly on the table. But a closer look shows that even as Speaker John A. Boehner and Representative Eric Cantor, the House majority leader, insist on the need for military cuts, divisions have opened among Republicans about whether, and how much, to chop Pentagon spending that comes to more than a half trillion dollars a year.
“TrueAnger™” Sphynx kitten!:
In an interview, Representative Vicky Hartzler, a freshman Missouri Republican backed by former Gov. Sarah Palin of Alaska, said that her priorities were jobs and “reining in runaway spending.” But when asked about the Pentagon budget, Ms. Hartzler, who defeated former Representative Ike Skelton, the longtime Democratic chairman of the Armed Services Committee, said that “now is not the time to talk about defense cuts while we are engaged in two theaters with men and women in harm’s way.”
Ms. Hartzler said she questioned the $78 billion in cuts to the military budget over the next five years, and added, “I will be a staunch defender of military installations in my district and across the country.” Ms. Hartzler’s district has two large military bases, Fort Leonard Wood and Whiteman Air Force Base, home to the B-2 stealth bomber and a new ground-control station for unmanned Predator drones.
Representative Scott Rigell, a Republican newcomer from Virginia who at first sparred with the Tea Party but then signed a pledge supporting many of its positions, said that he, too, was committed to strong military spending. In an interview after the hearing, he said that “as a very first priority, it is our Constitutional duty to stand an army.”
Mr. Rigell said he supported in the Pentagon budget “any responsible, wise reduction that can clearly be identified as waste,” but needed more specific information before he could judge where to cut. His son, he said, is a member of the Marine reserve and drives an amphibious assault vehicle, an earlier version of the Expeditionary Fighting Vehicle. On Mr. Gates’s decision to eliminate the EFV, Mr. Rigell said, “The abruptness of the decision is concerning me because we went down a long, long path. We went from it being a good decision and people defending it to ‘it must be cut.’ ”
Mr. Rigell, who represents a district around Virginia Beach that is economically dependent on the military installations, spoke at the hearing against Pentagon plans to move one of five nuclear aircraft carriers based in Norfolk to Mayport, Fla., taking with it 10,000 jobs.
Now, now we start to add the special secret ingredient: Fear! Fear! Fear!
Analysis: China prism focuses Pentagon budget on new weapons:
By Andrea Shalal-Esa
WASHINGTON | Tue Jan 25, 2011
Funding for a new generation of long-range nuclear bombers, new electronic jammers and radar, and rockets to launch satellites would help the U.S. military maintain its competitive edge even as China flexes its growing military muscle, Gates told reporters during his recent trip to Asia.
Revival of those projects — which Gates largely halted in April 2009 — would be good news for big U.S. defense companies like Lockheed Martin Corp, Boeing Co and Northrop Grumman Corp, which are scrambling for new work now that defense spending is beginning to taper off.
William Hartung, author of “The Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex,” said China’s military buildup would be used to justify continued U.S. investment in big-ticket weapons.
“A lot of it is just institutions within the military and the contracting community trying to keep money flowing in the style to which they’ve become accustomed,” he said.
GOP Questions Pentagon ‘Efficiencies’
By Nathan Hodge
In a letter sent today to Mr. Gates, the Republican leadership of the House Armed Services Committee expressed “serious reservations” about plans to chop items like the Expeditionary Fighting Vehicle, the Marine Corps’ next-generation amphibious tank, from the Defense Department’s shopping list. And they asked that the Pentagon put on hold any “stop work” orders on those items that are in line to be cut.
“Our immediate concern is that the Defense Department will take precipitous action in the near term that would undercut Congress’ ability to pass judgment on the recommendations,” states the letter, which is signed by Rep. Howard “Buck” McKeon (R., Calif.), Rep. Roscoe Bartlett (R., Md.), Rep. Mac Thornberry (R., Texas), and several others.
The letter is part of an ongoing campaign by legislators to spare the Expeditionary Fighting Vehicle, but the members also questioned proposals to halt the Surface Launched Advanced Medium Range Air-to-Air Missile, a surface-to-air weapon with the rather marvelous acronym SLAMRAAM.
Republicans will hold defense spending bill until another tax cut for the rich is passed.
Well, there you have it, over 500 billion a year. To all you people who say that that is not the single biggest expense we have, you have just been proven wrong.
If we are to get serious about reducing our deficit it is clear that the military industrial complex should be looked at first. If they don’t cut there, then they don’t really care about our deficit.
While the ramifications for defense spending—described accurately as “a disaster,” “a gigantic problem,” and “the worst of all possible worlds”—seem not to be resonating on Capitol Hill, the consequences are real.
Freezing Defense Spending Actually Costs More Taxpayer Money
Congress may ultimately end up wasting taxpayer money and spending more to restore programs upended by funding uncertainty and stringent rules about new starts and expansions. As a senior Pentagon official recently explained, a yearlong CR “would certainly be inconsistent with what we’re trying to do in terms of smart management of the department.
Impact on the U.S. Military
The short-term CR has already created a number of unnecessary problems for the military. Sean Stackley, Assistant Secretary of the Navy for Acquisition, Research and Development, outlined some of the practical effects of uncertainty on DoD spending plans:
Since we don’t have a 2011 spending bill in hand, we have to make certain assumptions regarding what will ultimately be appropriated, and that amount of uncertainty drives conservatism in terms of how you obligate the dollars that you do receive.
Part two, is that the dollars you receive, you’re not receiving a full year’s dollars. You’re receiving periodic updates, if you will, to your funding tables, and so you have major contract actions that are held in abeyance.
Stackley told reporters that a CR would hinder plans to grow the size of the U.S. Navy fleet. The President’s budget requested an additional $2 billion for shipbuilding over 2010 levels, and that funding is needed now to buy additional major surface combatants and increase production of Virginia-class submarines.
The men and women in uniform are also impacted when there are inadequate funds for defense in 2011. James McCarthy, Assistant Deputy Chief of Naval Operations for Integration of Capabilities and Resources, said last week, “Manpower accounts are short about $500 million under the continuing resolution, while operations and maintenance is light by about $4.6 billion.” If Congress forces a yearlong CR on the services, money will have to be moved from urgent priorities to make up for these shortfalls in personnel funding and current operations.
Cost-Creating in the Name of Cost-Cutting:
By bringing the defense budget back up to the President’s requested and legitimately needed level, Congress would be saving itself from creating unnecessary longer-term costs. By forcing the military to postpone plans to buy needed items for those in uniform, Congress will not end up saving any money. When schedules slip, costs grow. When costs grow, the overall buy is cut. This destructive cycle costs more in the long run and will only be perpetuated by a Congress demanding savings, efficiency, and the smart use of taxpayer dollars.
Delaying defense programs virtually guarantees their cost growth not just this year and next but every year thereafter. Congress should consider these two options in order to pass a defense spending bill that fully funds the President’s budget request for FY 2011.
Mackenzie Eaglen is Research Fellow for National Security in the Douglas and Sarah Allison Center for Foreign Policy Studies, a division of the Kathryn and Shelby Cullom Davis Institute for International Studies, at The Heritage Foundation.
Dear Nickel,
Let me introduce you to a dose of reality. We normal people you label as communist celebrate and embrace the tea party. We LOVE the tea party. You and your group of teabaggers keep running those stupid flags up the pole. Please..
“tea party my a$$….Your the same bunch of neocons that helped run this country into a ditch with Bush/Cheney and all the forced Dogma you tried to cram down the country’s throat…”
What he said.
http://english.aljazeera.net/watch_now/2007829161423657345.html
Egypt situation fast unraveling.
Burn like fire in Cairo - The Cure 80s song.
You mean Killing an Arab?
Standing on the beach
With a gun in my hand
Staring at the sea
Staring at the sand
Staring down the barrel
At the arab on the ground
I can see his open mouth
But I hear no sound
I’m alive
I’m dead
I’m the stranger
Killing an arab
http://www.musicfanclubs.org/cure/lyrics/killinganarab.html
Don’t worry, Bernanke says its contained.
Sammy .
That old POS Murbarak ,who pocketed over 25 billion while his people live in abject poverty ,is taking a peaceful demonstration and trying to turn it into a fight by his fake security forces starting it.
These poor people don’t have weapons .
I’m watching pure evil here . We don’t think about it here in America but even a 10% rise in food prices can crack the back of a lot of these
people . Is this what America endorses ,corrupt leaders pocketing billions
while the people live like rats with no freedom ? These people are hurting and the powers that be don’t give a shit and they are going to use force to keep them in line . They don’t even have a Middle class in that Country .Any Country that fleeces the people for the benefit of
the rich with their corrupt leaders deserves to be overthrown . Problem is how do you get anybody good to rule who would actually improve the lot in life these people have .
Maybe this will turn into a World revolution against …………..
the evildoers where ever they are . Maybe the time has come .
I thought people having weapons was a bad thing.
The conservative wisdom is that “other” people having weapons is a bad thing. If “your” people have weapons, well that’s a sign of a blessing from God.
Rest assured that your WalMart purchased shotgun would provide little protection if the US Military was turned on its people.
OTOH, the Iraqi insurgents have proven to be pretty effective against the U.S. military. And recall that the 9/11 hijackers used low-tech box cutters (and their own muscle) to kill almost 3,000 people.
That’s because the US Military is designed to be good at elimating mass numbers of people, not designed to be good at picking the one guy to kill out of a pack of 20.
If we leveled Afghanistan, then we’d win easily. On the other hand, the prize isn’t worth much, so it’d be much better if we folded up our tent and left that country to fend for itself. The money we spend on the war could easily be repurposed to better policing our own borders.
I sure hope the Wall Street greed pigs and the DC politicians who support them get a good look at the footage out of Cairo, so they can see what becomes of societies where the wealth distribution gets too uneven for too long a time period as they enjoy their bailout-funded bonus loot.
But then I guess nobody could have seen it coming!
Its different here.
It _IS_ different here! Our people are too apathetic to riot. Plus riots are not accessible enough—the obese have a hard time getting to/from the riot without their little electric scooters.
are too apathetic to riot ??
Take away all the freebee’s and then watch..
Freebees are the very effective angry mob suppressant of choice of our bankster-owned governmnet.
Which is why we will never take away all the freebies.
Can we get universal health care now? You know, like ALL advanced nations have? Just asking…
Can we get universal health care now? You know, like ALL advanced nations have? Just asking…
Nothing’s stopping you from paying for someone else’s health care/insurance right now. If you’re such a believer, you’re already practicing the philosophy, right?
“Nothing’s stopping you from paying for someone else’s health care/insurance right now. “
Yes, I am. Every time some poor unfortunate goes to the emergency room.
“Its different here.”
Yeah, we need to overthrow the corporations that are looting the country first, not necessarily the government that they own. That can come later, if necessary.
“…we need to overthrow the corporations that are looting the country first, not necessarily the government that they believe they own.”
Amen! SDGreg
(Hwy50 sends off another PostCard to God: “Just x1, please just one Celestial Revocation of x1 Corpooration Charter, I’ll take it as a sign of “good things to come!”)
With all Hopeful Respect,
Hwy50
And what do you propose to replace them with?
I would love for someone to lay out a plan that would transition us from corporations to…
And what do you propose to replace them with?
Unincorporated businesses maybe? Where individuals take full responsibility for the actions of their firms? Like the ones that we had almost exclusively in our first 100 years, and which even today generate most of our real wealth?
Just a thought…
“And what do you propose to replace them with?
I would love for someone to lay out a plan that would transition us from corporations to…”
We could bring back strong antitrust laws and enforce them. It’s been done in the past. But considering the vice grip these large corporations have on our country and our government, I’m not sure how we would do that now. Corporate control of the media and communications makes this more difficult now.
We could bring back strong antitrust laws and enforce them. It’s been done in the past.
Point of history: The Sherman Antitrust Act became law in 1890. And, for a decade, it just sat there on the books, doing whatever laws that aren’t enforced do while waiting for someone to notice them.
Well, in September 1901, Theodore Roosevelt succeeded the assassinated William McKinley as President of the United States. And sometime after that, he decided to start employing the Sherman Antitrust Act, which had really gotten bored. Idleness will do that to a law.
We know the rest of the story. Roosevelt became known as a trust-buster, a reputation that he thought was just bully.
Anti-trust law just gums things up even more. If we had the common sense (and guts) to repeal corporation laws, there would be no need for theatrics and posturing about trust-busting.
The greatest protection against radical groups taking over is a
strong middle class and proper ratios of distribution of resources .
Poor people will cling to any hope that is offered ,even if its a radical religious group ,if they promise them something other than their poverty lived lives .
“Poor people will cling to any hope that is offered ,even if its a radical religious group ,if they promise them something other than their poverty lived lives .”
Wasn’t that Obama’s platform?
You’re thinking of Bush Jr and the Religious Right.
Don’t worry. Common mistake.
“Poor people will cling to any hope that is offered ,even if its a radical religious group ,if they promise them something other than their poverty lived lives .”
This is why the poor send their sons and daughters to the middle-east; the savior is going to reward them beyond their wildest dreams!
Are you implying that “They” are gonna stick around and go on walk-about’s and such?
Violence in Egypt as foes, supporters of Hosni Mubarak clash
Fighting erupts in Tahrir Square as anti-government demonstrators and supporters of President Hosni Mubarak throw rocks and brandish clubs. The clashes follow a call by the Egyptian military for protesters to go home.
…
This will justify the crackdown by the army. Shooting peaceful protestors doesn’t play well in this country but we will accept shooting rioters.
“Shooting peaceful protestors doesn’t play well in this country but we will accept shooting rioters.”
I’m not disputing the accuracy of your characterization. But peaceful protesters being attack by Mubarak security thugs doesn’t make the peaceful protestors rioters. Such crude framing attempts don’t necessarily work on all Americans.
Unrest in Egypt LIVE 670 watchers
Follow Reuters’ coverage as a wave of unrest grips Egypt over President Hosni Mubarak’s 30-year rule
Uglier and uglier…
AM Report: Egypt Confrontations Spread
Feb. 2, 2011
WSJ’s Margaret Coker reports from Cairo clashes between pro- and anti-government protesters are spreading despite calls from the military for the protesters to disperse.
No, it’s anti-government protesters and thugs hired by the government to pretend to be pro-government protesters.
People throwing rocks ,people flying through crowds on horses and camels . Sometimes I think I’m watching a Raiders of the Lost Ark Movie watching this drama ……..unreal .
The people have been peaceful and that old tyrant is trying to
create grounds to stop the Peoples Revolution .
That’s how the game is played.
Remember, the sociopath always blames the victim.
ecofeco …I can’t keep my eyes off this revolution . And people wonder why these cultures can’t seem to advance …it’s the
Leaders holding these people down .
Private Sector Adds 187,000 Jobs in January- Reuters
US private employers added 187,000 jobs in January compared with a revised gain of 247,000 jobs in December, a report by a payrolls processor showed on Wednesday.
Unfortunately all the jobs added were of the “sign-twirling” variety.
I see a lot of Uncle Sams and Lady Libertys standing in front of tax filing shops. There’s a career!
How a New Jobless Era Will Transform America
The Great Recession may be over, but this era of high joblessness is probably just beginning. Before it ends, it will likely change the life course and character of a generation of young adults.
http://www.theatlantic.com/magazine/archive/2010/03/how-a-new-jobless-era-will-transform-america/7919/
There is nothing in the world that has changed my economic behavior more than two bouts of unemployment. Nothing. I was always a bit of a saver, but it became a near obsession in the wake of those two experiences. During one of them, I got a call from the official survey on consumer confidence (just who do the expect to contact at home at 4:30 in the afternoon, by the way), and seriously considered saying I was planning to make a major purchase in the next three months because I had just run out of Endust and knew that a new can cost about $4.00.
After 6 years in a steady job, I have relaxed a bit, but the effect lingers.
polly-
I’m with you on life’s vicissitudes are life’s lessons. During our “boom” income years (until 2003), I was a $ hoarder. I planned on a rainy day, never a Tsunami. It’s nice to have an oh chit fund.
Nothing like it.
Polly-
Legal Eagle question o’ the day
How many Mediations can the Defense request?
Can they ask to do some depositions before Mediations?
Federal Civil case
Thanks!
Mediations can be mandatory or in the control of one particular party because of the contract at issue. In that case the contract controls. I don’t think there is a rule on “number of mediations” that can be requested absent a contract. It depends on who can convince the judge that the attempt to settle the case will or will not be productive. That being said, you don’t want to be the one telling the judge that you do not want to even try coming to an agreement outside of his/her courtroom. Trials are long. Judges prefer to get rid of them.
There is nothing in the world that has changed my economic behavior more than watching two
bouts of unemployment. of my Uncles (and their respective family members) live like monks and pay of their family farm in 7 years.Talk about being able to sleep at night…
I’m still holding out for a “lots of jobs at no wages” scenario, if the U.S. stops getting lent money for imports.
We Already have that WT….Companies are abusing the Intern system and this administration, couldn’t care less about age discrimination…eg Recent collage graduates… Polly would know this….they still post for class of 2009 2010 lawyers and paralegals….and get away with it…
The no pay lo pay gigs doing real work for real companies on the NYSE and the big OH wont do a dammm thing about it….
OH I forgot to add…This Govmint only cares about Illegals in sweatshops, we had raids here in Long island city a few months back, and those Chinese illegals got paid for back wages some were given emergency housing food stamps…health care….and i don’t think any were deported…..
If they’re illegal they should be deported. Maybe there some backlog in the courts that’s delaying that.
Also, while you’re in the process of getting all riled up, you should direct some of the anger you’re feeling towards the businesses that chose to hire illegals instead of Americans for the sake of saving a few bucks.
There’s a lot of age discrimination over 50 as well.
“The Great Recession may be over, but this era of high joblessness is probably just beginning.”
Translation: The Great Recession ain’t over.
When is the Fake Recovery going to be over?
When the developing world FBs, recently created by the banks, start to default.
http://www.reuters.com/article/2010/12/22/brazil-economy-retail-idUSN2228596920101222?feedType=RSS
Any we were told Brazil was booming because of the sale of raw materials to China.
“When is the Fake Recovery going to be over?”
Down the road a few years things will turn around, but the crux of the article is that an entire cohort of twenty somethings will be negatively impacted throughout their entire careers. That’s bad for older people like me who expected greater returns from their retirement investments.
I would replace the “R” with a “D”. This is a Depression.
Translation: The Great Recession ain’t over”
But corporations are raking in record profits stock market is up
funny economy we have here a new kind where only highly skilled need apply H1B preffered
At BofA a source tells me Indian workers ( programers ) are preferred because when the Boss ( indian ) walks in they stand up. American workers apparently don’t
Is it the Indian boss who does the hiring? I guess he hires people to stroke his ego.
A friend similar example of this in grant funding. He said that Indians have made their way up the food chain in government agencies to where they choose where funding goes. The funds invariably go to proposals with Indian names, regardless of quality.
Nice post, I think ?? That intro to the article was quite disturbing if that is the way it evolves…
My comment was regarding theAtlantic article…
Welcome to the last 30 years.Nothing new here.
It’s why they had to relax all the lending qualifications in the last decade. Lack of customer with decent jobs.
Wall St. has eaten the seed corn and doesn’t know it yet.
…but to JUST blame the recession would be to willfully ignore the fact that the Repubs successfully voted against ending tax breaks for offshoring jobs.
THE PERFECT BAILOUT: Fannie And Freddie Now Send Taxpayer Cash Directly To Wall Street
Feb 02, 2011
Henry Blodget in Investing,
As the terror of the financial crisis recedes, many folks have forgotten about the two huge taxpayer-owned mortgage companies, Fannie Mae and Freddie Mac.
But they’re still there, money-manager Barry Ritholtz reminds us.
And they’re still sending billions of dollars of taxpayer cash directly to Wall Street, in what might be described as the “perfect bailout.”
How does this bailout work?
Fannie and Freddie got a “blank check” from Treasury Secretary Tim Geithner at the end of the financial crisis. This blank check allows the housing giants to lose as much money as they want, with the taxpayer footing the bill.
Fannie and Freddie use much of this money to buy mortgages from Wall Street at what may be grossly inflated prices. This is a super arrangement for the banks, because they get to unload all their terrible mortgages at prices that won’t produce losses. And it’s fine for Fannie and Freddie because, well, because they have the blank check.
But of course there’s no free lunch. And in this scheme, the US taxpayer is, as usual, footing the bill.
In other words, Fannie and Freddie are now doing what the Treasury wanted the original “TARP” bailout to do–use taxpayer money to help banks clean toxic assets off their balance sheets. Unlike the original TARP, however–which justifiably outraged taxpayers–no one knows or cares about what Fannie or Freddie are doing.
So, it’s the perfect bailout.
http://finance.yahoo.com/tech-ticker/article/535882/THE-PERFECT-BAILOUT%3A-Fannie-And-Freddie-Now-Send-Taxpayer-Cash-Directly-To-Wall-Street
Key House Republican plans Fannie, Freddie wind-down
* FACTBOX-Where is US financial regulation headed in 2011?
Tue, Jan 18 2011
By Corbett B. Daly
WASHINGTON | Thu Jan 20, 2011 2:30pm EST
WASHINGTON (Reuters) - A key Republican in the U.S. House of Representatives plans to reintroduce legislation soon that would wind down mortgage finance giants Fannie Mae and Freddie Mac within five years.
Representative Jeb Hensarling told reporters “five years is the right time” to wind down the two firms, which are now under the conservatorship of the U.S. government.
Hensarling, the fourth-highest ranking House Republican and a vocal critic of Fannie Mae and Freddie Mac, said he is open to arguments for changing the timetable, though he has not heard anything yet that would cause him to take a slower approach.
“What is absolutely nonnegotiable is getting the taxpayer off the dime and ensuring that these are no longer government sponsored enterprises, implicitly or explicitly, or in any single way,” Hensarling told reporters on Capitol Hill.
The two firms have taken more than $150 billion in direct taxpayer aid since then-Treasury Secretary Henry Paulson seized them in September 2008 as loan losses mounted.
…
‘no one knows or cares about what Fannie or Freddie are doing’
I see this kind of report as part of the narrative that this all started in 2007. But this story is much larger than the media is letting on. What if I could show you that this whole thing was set up by 2004 or earlier?
‘For new readers, a basic premise of this blog is that mortgage originations peaked in 2003, and the top in home prices and sales couldn’t be far behind. The latest monthly summary from Fannie Mae is a good example.’ (see link for the numbers). Fannie lending is down a trillion dollars from 2003 levels. How can prices rise with the cash drying up? The overall numbers are similar, except that now most of the loans are subprime, which wasn’t the case in 2003.’
‘The big players are aware of this, and they know the market is doomed to fall. While they arrange for the crash the public has been left to dig into a debt situation without precedent.’
http://thehousingbubble.blogspot.com/2005/05/mortgage-totals-and-fannie-mae.html
It was all there for anyone to see:
‘This morning the global credit evaluation service, Fitch Ratings, held a conference call and issued a position paper titled “GSEs: Are the ‘AAA’ Ratings at Risk.” While the short answer is maybe, the statement makes it clear that the GSE bonds receive a high grade due to the understanding that uncle sam will guarantee them. “Senior debt ratings…include an assumption of support from the US government that would be provided in the event of severe financial stress”.
‘It goes on to say this view is reinforced by current legislation being considered that would increase oversight rather than cut ties to the firms. Fitch also made clear that if the guarantee were removed it would damage the entire economy. “If there was a major problem in their ability to issue debt, then the government would have to step in in order to support not just the GSEs but the overall economy as well,” said Fahey. “It’s very similar to support that we view in the money center banks in the United States.”
‘In other words, too big to fail. And much of the report focuses on how the failure should be handled! Together with all the hints coming out of the White House and congress about a bailout, todays announcement reinforces the suspicions that the GSEs are in trouble. Consider this: Fannie isn’t providing financial statements. Massive drawdowns of Freddie and Fannie portfolios are ongoing. And new legislation that would allow a government agency to take over the firms is expected to pass.’
http://thehousingbubble.blogspot.com/2005/02/fitch-ratings-us-government-will.html
Exactly what was to happened was openly reported in the media in spring 2005:
‘The Office of Federal Housing Enterprise Oversight is pushing legislation through congress that prepares for the insolvency of the mortgage giants. Patrick Lawler, OFHEO chief economist told a forum “Receivership is a valuable thing”.
http://thehousingbubble.blogspot.com/2005/02/fanniefreddie-regulator-preps-for.html
OK, so look at the numbers in the first link (which I had been tracking for months by then) and make your own conclusion: with trillions evaporating from the market peak of 2003, and the subsequent explosion of subprime/heloc/no-doc lending, everything that has happened with the GSEs was already in the works by spring 2005.
So I’m curious; why doesn’t the media follow the crumbs back in time? Why are we constantly told about a crisis that started in 2007?
“While they arrange for the crash the public has been left to dig into a debt situation without precedent.”
Kind of brings to mind the post-crash rush of the sheeple into long-term Treasurys, no? You can bet the MSM will say ‘no one could have seen it coming’ when long-term interest rates eventually head back up, precipitating a blood bath in come-lately bond investors…
‘no one knows or cares about what Fannie or Freddie are doing’
Well one fellow did….
Mozilo Predicted U.S. Housing Collapse as Fed Overlooked Risk
Former Countrywide Financial Corp. Chief Executive Officer Angelo Mozilo warned as early as 2004 of a possible housing-market collapse while the Federal Reserve overlooked the threat a year later, according to documents released by the Financial Crisis Inquiry Commission.
“Not only at Countrywide, but also with other lenders, there is a clear deterioration in the credit quality of loans being originated,” he wrote to company executives on Sept. 1, 2004. “The type of loans currently being originated combined with the unprecedented stretching of all aspects of credit standards could cause a bump in the road that could bring with it catastrophic consequences.”
I love these feel good stories.
http://www.bloomberg.com/news/2011-01-28/mozilo-predicted-catastrophic-consequence-as-fed-overlooked-housing-risk.html
…he wrote to company executives on Sept. 1, 2004. … -’cause he certainly wasn’t sharing that wisdom with the rest of the world, especiall those he sold those ever poopier mortgages to.
Nix, nix, nix,…as a true CEO Corpooration Inc. “Professional” he sent out a company wide memo:
“Don’t…Stop!….Don’t…Stop!…Don’t…Stop it!”
“Anyone who does not follow through with this Executive Memo, will suffer the consequences!” A. Mozilo
“So I’m curious; why doesn’t the media follow the crumbs back in time? Why are we constantly told about a crisis that started in 2007?”
Because to do so would show without question, that the PTB set the whole thing up or, at the very least, allowed it to happen.
OK ,I said years ago this was the big plan ,unload everything on F&F
and that way these Banks get additional bail outs . F&F is the dumping ground .These evil corrupt entities that created the financial meltdown to begin with get bailed out while the Majority eat’s it . The casinos are still alive and kicking and the corrupt Money Men are back to their old
tricks . This was Obstruction of Justice on how Standing Law and Contract law would of rendered punishment to these Culprits .
Go back to my posts leading up to TARP ,you could tell they were sitting up F&F to take the toxic junk . How competent can our Government
be that they give the bail outs first and than investigate later .I’m really worried about the damage these clowns in office can do . And
the Fed is nothing but a tool for the Banks and Wall Street .
Crooks ,nothing but crooks controlling our elected Government .
No meaningful reform on the corrupt financial systems and casinos .
Just look where it will lead us if the USA revolves around Wall Street and Corporation Monopolies ,instead of a productive Middle class
with reasonable paying jobs . The Health Care Insurance Monopoly wrote that damn Health Bill . You would think that the elected
Politicians would at least think about their own Children and grandchildren and want to do what is right by the USA .
‘the big plan…unload everything on F&F’
It’s not everything. Much of the 2002-2004 subprime/no-doc/etc loans weren’t guaranteed by the GSEs. They didn’t jump headlong into subprime until it was almost done. These non-GSE losses can be seen in the hits taken by derivative holders; hedge funds, pension funds, etc.
Here’s what makes this extremely relevant today; this isn’t over by a long shot. If the govt has sunk $150-300 billion into the GSEs so far, IMO we will be looking at 10 times that eventually, maybe more. This arrangement doesn’t have to continue.
I wish this arrangement would stop now Ben . I have proof of
F&F buying a loan from Countrywide that put it on BOA books
and than bought it at par value . The loss was 80% when the property re-sold and F&F took the loss.
IMHO ,I agree these losses will just continue ,but isn’t this a
form of secret bail-out ? If you have a agency that is buying paper at a greater than market value isn’t this a way of giving more bail outs ?
Acting like Tarp is being paid back while F&F is buying overvalued toxic assets is a fraud . They are acting like these loans were already on F&F books or just made recently .
This all started with the FEDS making all those short term loans
on junk leading up to TARP . Basically all these corrupt entities
put the FED in the position of having billions in short term loans that would default . Wall Street played the Fed like the
jerk he is . Now the Fed is locked into Wall Street Bankers play book .That is the problem . The whole idea from day one was to save these Culprits and their Casinos and avoid the exposure of their corrupt World that has compromised the rest of the
USA .
Like you said ,the taxpayers paying for this will just continue
until it ends .
Bail-out is an over used term, IMO. The guarantees that the GSEs were making weren’t a secret, and I’ve shown the congress and OFHEO had to know the GSEs would fail in 2004-05, and they passed laws in 2005 to set up receivership. I documented it with MSM sources. My question is, why are we ignoring this now? We hear this meme about 2007-08 and Lehman Brothers, but what about this prepping for receivership in congress in 2005! What about the 1000+ off-shore entities Fannie had, that disappeared from the MSM?
Why is this important? Besides basic accountability, DC is planning the future of the GSEs. What if this data I’ve gathered was included in the public discourse on F&F’s future, or the role of govt in housing, generally?
And this is a large issue; with all this talk of ‘what to do with Fannie/Freddie’, why aren’t we told what the various options will cost? IMO, we could save many trillions of $ today by telling these banks, ‘you know what, there was no govt guaranteed of these companies. Go back and read what you signed up for.’
As long as you have all these foreclosures I suspect the GSE’s
will remain in tact in present form ,IMHO . How are they going to get a private secondary market going (without GSE backing )
with all these foreclosures ? And what would the interest rate be in a real private secondary market ,a lot higher with higher fees and higher down payments . IMHO ,until the critical mass
of foreclosures are disposed of in one form or another they will keep the GSE’s in present form with maybe a slight raise in interest rates and costs .
Anyway ,just my opinion .
Well yes, F+F were NOT down with the flounder and catfish eating the worst of the subprime mortgages when the bubble was building. But the stated plan early on in the bust was for them to buy a large number of (incorrectly) highly rated bonds to save the banks from their bad decisions. Now I’m certainly unclear as the extant to which this actually happened, but there were several congress critters that though that if only we could get F&F to provide more liquidity, everything would be just fine.
HW, Ben, Jim. I posted something up higher and this discussion illuminates how the game is being played. But those investors that bought MBS’s not backed by GSEs will have to absorb their own losses.
I agree with HW with the situation where FnF is reimbursing Bofa at face value only to book the loss for them at the taxpayer’s expense.
Good thing we don’t pay taxes.
Why not? too little income and sufficiently low investment income from my rental house.
Wife worked full time at a grocery during summer; lunch lady for the rest of the year. Her lunch lady job is hard; too little hours for too much work, but its at our kids’s school which is awesome perk of this BS job. She used to run markets for me at similar pace for $30/hour; but then I hurt my back and have been surgeried 4x but still have debilitating pain.
At her nutrition services site manager (read: she is all alone serving 200 lunches and 125 breakfasts, and taking money and keeping food at temp in 3.5 hrs/split shift)
If she does not have enough time to do her work, instead of granting her 15 min overtime (cost in wages $2.50); they send a supervisor out to her site to help out. Her site is peripheral; just coming from central kitchen takes 35 miles round trip plus the supers work at a higher rate. But NO overtime is granted except for emergencies due to the potential ramifications of giving a peon too many hours.
She made 10k in 2010. I made 10k as a sub teacher and tutor. I am somewhat limited by pain but I try my best.
Best payday for us was filing taxes; $7800 in EIC+child tax credit. Too bad our medical expenses equaled our income,and are deductible but not credits. Insurance wont cover wife’s birth control even though she is taking it for uterine fibroids to avoid a partial hysterectomy; nor my fibromyalgia meds; nor their proposed alternative which includes an antidepressant for which I dont have mental health benefits. But since I still own a house we dont want another catastrophic medical event to cost me my house. Rant off/We have a roof and our kids are a joy and so is the time we spend with them, but being poor after being “rich” is a difficult adjustment. Food stamps and HUD housing here we come!
most of the junk mortgages were made with wall street money.They provided credit lines to the shady lenders and then packaged up the bogus loans and sold them to places like iceland.I wonder what % of no doc loans were made via wall street money vs the GSE’s?
A lot of investors who bought the junk from wall street are no stuck with their pants down.Now you are starting to see the lawsuits fly.
Fannie and freddie had stricter underwriting guidelines than wall street when selling a loan to them.Wall street underwriting basically was a pulse.
Treasury Secretary Timothy F. Geithner met with chief executive officers Jamie Dimon of JPMorgan Chase & Co., Brian Moynihan of Bank of America Corp. and Stephen Schwarzman of Blackstone Group LP in December to discuss how the Dodd-Frank financial overhaul law will be implemented.
The Securities Industry and Financial Markets Association, Wall Street’s biggest lobbying group, said in a statement Jan. 18 that “regulators will need to strike the right balance” to ensure that market-making and hedging activities aren’t hurt by the Volcker rule ban on proprietary trading.
Oh good, this should help….
Sounds like backroom deals may be in the works between Timmay and his future employers to determine how the TBTF banks can best be shielded from any negative consequences of implementing Dodd-Frank…
Thankfully the people were represented at Davos …
US Congressman Barney Frank, also present at the meeting, said that contrary to 2006, there was now a recognition among bankers that policymakers need to regulate the sector, and probably venture into the “shadow banking” system at some point.
http://www.stuff.co.nz/business/world/4607708/Bankers-play-contrite-at-Forum
Oh ,they are finally thinking that “shadow banking ” should be ventured into .I can’t watch anymore of this ,it’s just to
insulting .
I am with you. At times the thievery appears unstoppable….
Thankfully the people were represented at Davos …
…probably venture into the “shadow banking” system
The Swiss Bankers always seem to be so,…quiet. Do they really ever talk, or just wink & nod? Maybe the HedgeFund Masters are trying to learn how to emulate regulation “neutrality”?
Timmay offering Wyle-E-Coyote an ACME umbrella before he heads for the cliff. A pre-bailout bailout to prevent a bailout.
That’s like the cops meeting with the bank robbers before the robbery to make sure the getaway car is not illegally parked and they have the proper disguises and a viable getaway plan.
OT on Americans’ Understanding of World Events:
A couple of weeks ago Fred Reed ran a spoof article about the war in Afghanistan, where he deliberately mis-identified the names of people, places, reasons, and weapons used, etc in the most egregious fashion.
(Such as referring to Hecuba and Priam as Afghan hotspots, when they were actually the queen and king of Troy in the Iliad; and as Sulawesi bordering Iran, when it is actually an island in Indonesia.) What he got in response is that most readers who responded did not see the errors but nonetheless were resolute in their support of the war. This is his response to those responses -
“…Human beings are intensely local animals. Afghanistan is not very local, being intensely Somewhere Else. It has little to do with getting the kids through school, planting the flower garden, shoving the software project out the door on time, or getting drunk at Bobby-Lou’s Rib Pit.
And of course we are herd animals with a formidable tendency to attach ourselves to groups—it doesn’t much matter what groups—and fight other groups. Thus football teams, bowling clubs, political parties, and wars. Patriotism is exactly the instinct that makes people cheer frantically for the Steelers against the Packers, and armies are just Crips and Bloods with more elaborate switch-blades.
All of this I suppose explains why so many are either flatly uninterested in the war or, a la Fox, very interested but without knowing anything about it—where it is, who is fighting whom and why, how the place got that way. Emotionally it is the Bulls vs. the Lakers. Intellectually it is an empty jar.
And yet it remains, or seems to remain, that the public, almost all of it, has not the slightest grasp of the war—and, by easy extension, of anything else outside the borders. When I listen to Bill O’Reilly, I want to hold up a placard behind him, asking his audience: Where is Yemen? What is the capital? Have you read a single book on Afghanistan? Read any book on anything? Heard of Eric Margolis? Can you distinguish Sunnis from Albigensians?
This of course is why the US is not a democracy: a country whose population consists chiefly of baffled gerbils cannot be a democracy in more than form. Instead we have the televangelists of ersatz patriotism shilling for policies of benefit to remote lobbies, while a catastrophically ignorant public shrieks approval. Gorgeous babes on Fox counsel war. The audience roars. Ricky, Ricky, he’s out man, if he can’t do it nobody can. Show your support for Central High. God almighty.”
A link to the Fred on Everything article posted above:
http://www.fredoneverything.net/FOXghanistan2.shtml
“catastrophically ignorant public”
Your public education dollars at work.
More like 24/7 MSM.
“BRAWNDO!”
You can lead a horse to water…
I remember hating current events and I was one of the better students.
I also remember keeping our teenage son home to watch the unfolding of Desert Storm. His classmates who went to school enjoyed the normal curriculum.
And another child’s 4th grade teacher didn’t bother to teach a science lesson on a partial eclipse of the sun. It occurred to me that some of those students wouldn’t live long enough to see another one. I still can’t understand how anyone could pass up an opportunity like that.
This is a good question: just what percentage of America truly fits the good ol’ boy stereotype spoofed above?
Liberals discussed that question about 2005, and they came to a rough consensus of 27%. That 27-28% number cropped up in a variety of places: approval ratings of George Bush at his worst, approval of Dick Cheney, those who believe the earth is 6000 years old and think creationism should be taught in schools, or approval of Beck/Limbaugh.
Gorgeous babes on Fox counsel war.
Faux News & WSJ = MU
rDoichk’s “True Chupacabra™” cash generatingAustralianAmerican machine.A Marblehead woman has been sentenced to up to five years in prison for stealing more than $500,000 from the plumbing company she worked for as a bookkeeper.
Kimberlee Mastronardi, a 52-year-old mother of three, was also sentenced Monday in Salem Superior Court to five years of probation and ordered to pay restitution.
Not that it’s right, but tell me again how many years The Orange Man from Country Wide received?
Guessing there were no “friends of Kimberlee” in the Senate.
“TrueIndemification™”
“Indemnification” is a “privilege” bestowed upon those outstanding individuals with…grace, benevolence, premier address, “earned” societal admiration, wealth and a hired gun with a feared reputation.
(Occasionally, “they” throw one of their own into the arena to stir up the empathy of the “non-indemnified taxpayer/citizen”, i.e., Martha Stewart etc., etc., etc…)
Not that it’s right, but tell me again how many years The Orange Man from Country Wide received?
Ah - but what you fail to see is that this bookkeeper didn’t not give special services to her congresspeople and senators like Senator Dodd.
Fees for home mortgages increase ~ By Julie Schmit, USA TODAY
For the first time since 2009, Fannie Mae and Freddie Mac are raising risk fees they charge lenders on loans they buy for resale to investors. The mortgage giants are also adding risk fees to more loans extended to people with stellar credit. To avoid a fee or to get a discount, most borrowers will need FICO scores of 740 or better and down payments of 25% or more. Lenders could absorb the cost, but most are expected to add it to loan costs within days, if they haven’t already, says Cameron Findlay, LendingTree economist. The increases affect most loans with longer than 15-year terms sent to Freddie starting March 1 and to Fannie on April 1.
For example, a buyer of a $200,000 house who has a 700 FICO credit score and 20% down payment will pay $1,600 for the Fannie risk fee vs. $1,200 before. If the borrower’s score is 680, the fee will be $2,800. Borrowers can pay fees upfront, or lenders will price them into interest rates.
Fannie’s going to make good on the $trillions it owes, one $400 at a time.
We are all a bunch of cattle being controlled by the profit takers ,or the dictators ,or the radical groups ,or the bribed Politicians ,or the Monopolies
Sheep.
To be shorn.
And don’t gettin’ uppity, peasant!
Austrailia is starting to see the crash. I have a link to their newspaper. New mortgages are down 40%. They say it is because of the flood but the flood was in one area. Every part of Austrailia is seeing a slowdown. Welcome to the last phase of the bubble.
http://www.theaustralian.com.au/business/floods-and-interest-rates-hit-homebuyer-confidence/story-e6frg8zx-1225999025417
Here’s a new one, taxpayers footing the bill for bank lobbyists:
Investment banks billed California an estimated $1.5 million for dues to trade groups, including a municipal-bond lobbying association, since 2005 and will be required to return the money, state Treasurer Bill Lockyer said.
Lockyer ordered 86 firms in the state’s underwriter pool to stop including the dues in their calculation of fees paid out of bond proceeds, Tom Dresslar, a spokesman for Lockyer, said in an e-mailed statement today.
“Making taxpayers, in effect, foot the bill for banks’ lobbying or campaign activities is not justified under any circumstances,” Lockyer, a 69-year-old Democrat, said in the statement. “It’s improper, it will stop now, it will not happen again and we will get our money back.”
Only fair, we wouldn’t want the cost to come out of their bonuses now would we…
http://www.bloomberg.com/news/2011-02-01/lockyer-says-underwriters-billed-california-for-dues-paid-to-trade-groups.html?cmpid=yhoo
John McCain: prohibit airports from installing bike racks.
http://streetsblog.net/2011/02/02/rational-basis-notwithstanding-aviation-bill-rider-targets-cyclists/#comments
Oh, for pete’s sake, John. Have you ever biked to the airport?
Well, here’s one of your constituents from Tucson. I’ve biked to/from many airports. Including Phoenix Sky Harbor. Boy, was that a scary experience.
OTOH, Tucson’s airport is a dream to bike in and out of. I’ve done it and highly recommend it.
See you on the road, John!
So - how do you protect yourself from this???
Credit freezes? Monitor your stuff hourly?
——————————-
The king of home equity fraud
http://money.cnn.com/2011/01/24/real_estate/onwuhara_home_equity_fraud_full.fortune/index.htm
Onwuhara specialized in hitting home equity lines of credit (HELOCs), the reservoirs of cash that banks make available to homeowners. Once Onwuhara gained access to a HELOC, he could siphon out vast sums in seconds. His weapon was persuasion. It got him enough money to start building a colonnaded fortress in Nigeria; enough to gamble at the high-stakes tables in Vegas casinos all night. Even his accomplices appear not to have known how much he was really pulling down — not even his beautiful fiancée, Precious Matthews.
In hindsight, it seems obvious that a savvy cybercriminal would target HELOCs. From 1998 to 2007, the percentage of homeowners with HELOCs jumped from 10.6% to 18.4%. Credit balances soared. All the information a scammer needed was available online. The trick was cobbling it together. Onwuhara taught himself how.
Using ListSource, a direct-marketing company, he’d collect mortgage information on married couples with million-dollar homes. They qualified for high HELOCs. He’d find lease or loan papers through public databases and pay sites, then use Photoshop to grab homeowners’ signatures off documents. Next, he’d build a profile of the victim by paying for a background search through skip-tracing sites. That would give him birth dates, Social Security numbers, names of relatives, previous addresses, employment histories, and more. To get a mother’s maiden name he would use Ancestry.com.
Profile in hand, he would run a credit check on victims through annualcreditreport.com, a website set up by the big three credit-reporting agencies. Onwuhara had discovered a flaw in the Experian portion of the site, which screened users with a personalized security question and several multiple-choice answers. Users had to click on the correct answer to proceed. But when Onwuhara refreshed his browser, he found that the site replaced certain answers with new ones. Clearly, these were red herrings. Onwuhara knew the correct answer to the security question would appear persistently on screen as he refreshed. Enough refreshing would eventually reveal the true answer and allow Onwuhara to access reports. (A spokesman for Experian says that the company is cooperating with law enforcement authorities and that “since this case we have refined our security protocol.”) The reports provided Onwuhara with details about the victim’s HELOC. He preferred credit union HELOCs: They were soft targets.
At this point artistry came into play. Onwuhara used a phone service called SpoofCard to make any number he wanted appear in a caller ID. This was key to his scam. With SpoofCard, Onwuhara could fool financial institutions into thinking his call originated from the victim’s phone. Onwuhara knew the system. He knew the questions he’d get. Usually he had the answers, along with account numbers, balances, and passwords. Altering his gravelly voice like a professional actor, he could switch ethnicity, age, and accent on a whim. A customer service rep was easy prey.
Not buying loans that aren’t procured via a face-to-face signing with photo ids would be a good start, because if nobody buys the loans, very very few people would originate them.
And anyway, it’s not YOUR problem, it’s the credit-union’s.
In hindsight, it seems obvious that a savvy cybercriminal would target HELOCs.
Seems like he spent a lot of energy and effort…getting hired on at Goldenmansucks Inc. would’ve been more admirable and less conniving,…maybe.
America’s Debt Crisis
Hey, Congress: We need more money!
NEW YORK (CNNMoney) — Want Congress to freeze government spending? Well, it already has.
For the past four months, government agencies have been operating at last year’s funding levels because Congress has failed to approve a budget for the new fiscal year.
Now two agencies central to regulating the financial markets — the Securities and Exchange Commission and the Commodity Futures Trading Commission — are warning they will have trouble enforcing the new Dodd-Frank Wall Street reform law.
And Defense Secretary Robert Gates says that uncertainty over Pentagon funding is threatening military readiness.
“I have a crisis on my doorstep,” Gates told reporters last week.
Without additional funding, operations and maintenance will suffer, Gates said. Training for troops will be reduced, overall military readiness will be hurt and pilots will get less flight time.
It’s not unusual for agencies to argue that budget cuts will harm their ability to do their jobs. Still, the current uncertainty over funding is raising alarms.
Gates blames Congress. Instead of passing a budget, lawmakers have approved a series of four temporary extensions — so called continuing resolutions — that mostly freeze funding at last year’s levels.
He should be thanking his lucky stars the sensible 10% cut to everything government run hasn’t been implemented.
“The state swells up….the people diminish.” ~Vasilii Klyuchevski (19th century Czarist Russia)
Item: The lowly cent ain’t so “lowly” anymore, especially if it was minted prior to 1982. That was the year Uncle Sam quit making one-cent coins from mostly copper and switched to cheap zinc, coated with a thin veneer of copper to resemble the real thing.
Thanks to the recent rise in the price of copper those pre-1982 cents are worth 3¢ in metallic melt value.
In strongly worded statements from time to time the U.S. Mint informs us that it is illegal to melt coins. This directive concerning minor coins has never been tested in the higher courts.
Can the United States government claim to own and control a small disc of copper which you thought you owned outright? Is it reasonable to be forced to value your pre-1982 copper cent at 1¢ in the marketplace when its true value in the melting pot is 3¢?
Can the United States government claim to own and control a small disc of copper which you thought you owned outright?
The “things” that command wmbz’s vital energy are rather curious…
From Wikipedia,
Gresham’s law is commonly stated: “Bad money drives out good”, but is more accurately stated: “Bad money drives out good if their exchange rate is set by law.”
This law applies specifically when there are two forms of commodity money in circulation which are required by legal-tender laws to be accepted as having similar face values for economic transactions. The artificially overvalued money tends to drive an artificially undervalued money out of circulation [1] and is a consequence of price control.
Gresham’s law is named after Sir Thomas Gresham (1519–1579), an English financier during the Tudor dynasty.
So I expect good money that is 3cent copper coins and other coins like nickels to be hoarded and melted replaced by the new light plastic looking coins
The really new pennies feel even flimsier, like they’r emade of plastic.
This is important, so I took the liberty to forward it.
Comment by jeff saturday
2011-02-01 19:58:36
Federal anti-flipping rule waived through 2011 to keep homes selling
by Kim Miller
The Federal Housing Administration announced today it is extending its anti-flipping waiver through 2011 to encourage the resale of foreclosed homes.
The rule prohibits FHA to issue a mortgage on a home owned by a seller for less than 90 days.
From the press release:
This action will permit buyers to continue to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales. It will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities.
“As I noted when we first announced this policy change early last year, because of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers,” said FHA Administratoin Commissioner David Stevens. “Today I can report that this policy change has been effective. Since the original waiver went into effect on last February, FHA has insured more than 21,000 mortgages worth over $3.6 billion on properties resold within 90 days of acquisition.”
FHA research finds that in today’s market, acquiring, rehabilitating and reselling these properties to prospective homeowners often takes less than 90 days.
Prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition adversely impacts the willingness of sellers to allow contracts from potential FHA buyers because they must consider holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.
Stevens added, “Because of past restrictions, FHA borrowers have often been shut out from buying affordable properties. This action enables our borrowers, especially first-time buyers, to take advantage of this opportunity and buy a home that has recently been rehabilitated. It will also help to move more foreclosed properties off the market and reduce the number of vacant homes in neighborhoods throughout this country.”
Brittany Murphy’s Former Home Sidesteps Foreclosure Auction
FoxNews.com
The home of the late actress, Brittany Murphy, has avoided a foreclosure auction for at least two weeks. The Hollywood Hills home was first listed for $7.25 million in March of 2010 but was taken off the market a month later.
Reuters reports that the home was scheduled for auction this past Monday, but the auction was postponed for two weeks, giving Brittany’s mother, Sharon Murphy, a chance to sell the property at the steeply reduced price of $4,995,000.
Brittany and her mother purchased the 8,000-sq ft house for $3.85 million from pop star Britney Spears in June 2003. Brittany lived in the home with her husband, Simon Monjack, up until her sudden death on Dec. 20, 2009 at the young age of 32.
Monjack also passed away in the home just a few months later in May 2010.
Despite its tainted past, Brittany Murphy’s home is truly stunning. The 5-bedroom, 5-bathroom house sits at the end of a private cul-de-sac on a .86-acre lot, offering amazing views of the city. The Mediterranean estate also includes high ceilings, a gourmet kitchen, large living and dining areas, outdoor swimming pool, gardens, gym, office, motor court and a 4-car garage.
“Brittany lived in the home with her husband, Simon Monjack, up until her sudden death on Dec. 20, 2009 at the young age of 32.
Monjack also passed away in the home just a few months later in May 2010.”
Hollywood’s Haunted Mansion won’t sell for the owner’s wishing price? Go figure…
Well, all day long at school I hear how great Brittany is at this or how wonderful Brittany did that!
Brittany, Brittany, Brittany!
laughings out loud
Political scientist explores foreclosure lessons
Jan 31, 2011 by Ryan Heinz
Todd Swanstrom, the E. Desmond Lee Endowed Professor of Community Collaboration and Public Policy Administration at UMSL, wrote “Resilience in the Face of Foreclosures: Lessons from Local and Regional Practice.”
Real estate data company RealtyTrac has reported that a new record for foreclosure filings could be set in 2011. In a new national report, University of Missouri–St. Louis political scientist Todd Swanstrom looks at how cities and counties are responding to this ongoing predicament.
Swanstrom, the E. Desmond Lee Endowed Professor of Community Collaboration and Public Policy Administration, wrote “Resilience in the Face of Foreclosures: Lessons from Local and Regional Practice” with James A Brooks, program director for housing and community development in the Center for Research and Innovation at the National League of Cities.
The research report was published last week by the National League of Cities. It includes extensive studies of the following six metropolitan regions: St. Louis; Atlanta; Chicago; Tampa-St. Petersburg, Fla.; Cleveland; and Riverside-San Bernadino, Calif.
The report includes summaries of strategies used in these areas to help mitigate the foreclosure challenge and set the stage for initiatives designed to revitalize the neighborhoods that have been impacted by foreclosures.
“Despite the staggering volume of foreclosed and vacant properties, there are success stories to be reported about the ways in which cities, counties and their elected local leaders are responding to the continuing waves of home mortgage foreclosures,” Swanstrom and Brooks wrote in the report.
…
How inflation is turning breakfast into a luxury item
February 2, 2011 10:10 am
The Fed’s policies are pricing basic morning staples out of reach — and the results may come back to haunt even those who don’t notice.
By Keith R. McCullough, Hedgeye
“Poverty wants some things, luxury many things, avarice all things.”-Benjamin Franklin
Yesterday, one of our young Jedi analysts at Hedgeye, Kevin Kaiser, sent me a highlight from The Grocer (an industry trade rag) that inflating food prices are making ordinary breakfast items like orange and apple juice a “luxury.”
Now a Wall Street analyst at a sell side investment bank would find a way to dress this data point up with a pig’s lipstick and call it an “affordable luxury.” Someone working for Federal Reserve Chief Ben Bernanke probably calls something like breakfast “non-core” or “free.” But we simpleton, non-recipients of government bailout moneys, just call it what it is – inflation.
…
How can prices have “leveled out” when they are still dropping in three out of four major metro areas? And I also fail to understand how a backward-looking index can predict year-end 2012 market health.
Makes no sense to me…all I know is that San Diego home prices are still way out of line with incomes and rents.
Agustino Fontevecchia
Moral Hazard
Price Stability In 75% of U.S. Metro Areas By Year-End, Double-Dip Looms
Feb. 1 2011 - 7:01 pm
By AGUSTINO FONTEVECCHIA
Index estimates all metro markets will be healthy by the end of 2012.
While most home price indices point to an imminent double-dip, one of the few leading indicators forecasts that pricing stability will hit 75% of metro markets by the end of 2011. The Fiserv Case-Shiller Index, which measures price changes in single-family homes in over 375 U.S. metropolitan markets, estimates that home prices have already leveled out in one out of four metro U.S. areas, despite price declines of 1.5% in the third quarter of 2010.
…
From CNN Money:
Here are the 6-month price percentage moves in some of the things people need to live with:
* Cotton = +125.7%
* Sugar = +82.6%
* Corn = +59.0%
* Coffee = +41.4%
* Rice = +40.5%
* Oats = +36.6%
* Copper = +36.1%
* Lumber = +33.8%
* Oil = +25.1%
Nope. No inflation here.
Flatscreens continue to declline. And iPhones. That is what really matters.
“We’re all going to be thinner” - Han Solo.
After seeing how the Majority of Egyptians live I”m convinced that
the lack of stability in this World comes from the nuts at the upper
end of the pecking order .
Banks and unions - the biggest leaches on the US Taxpayers.
————————————-
Chrysler Loses Money, Gives UAW Bonuses
National Legal & Policy Center ^ | February 2, 2011 | Mark Modica
Chrysler recently reported a 4th quarter loss of $652 million. So what does a UAW majority owned company that is losing money do? How about a bonus for UAW workers?
Current Chrysler ownership breakdown puts the UAW at a 63.5% ownership stake while the US Treasury holds a 9.2% stake. Italy’s Fiat currently owns 25%. Bonuses planned for UAW workers are estimated to average $750.
It is disturbing that at the same time Chrysler plans for UAW bonus distributions they are back asking taxpayers for more money. Reuters reports that Chrysler has applied for $3 billion in subsidized loans from the Department of Energy. Sean McAlinden, chief economist for the Center for Automotive Research, says that Chrysler expects “another really tough year and they need the money.” It seems odd that the UAW would receive bonuses under these circumstances.
The auto bailouts, as orchestrated by the Obama Administration, demonstrate that the UAW will get their payoffs, by hook or by crook. Ford factory workers are to receive about $5,000 each in bonuses. GM is expected to announce their bonus plan after reporting earnings. UAW president, Bob King has made clear that the UAW expects to share in any profits attained by GM, Ford or Chrysler. In the case of Chrysler, it seems the UAW expects to benefit even in the absence of profits.
Based on the past generosity displayed towards bailed out automakers, it is unlikely that Chrysler’s loan request will be turned down. It remains to be seen if Republicans that now control Congress have the courage to stand against the continued taxpayer funding and UAW favoritism that have arisen from the auto bailouts. The politically favored UAW continues to benefit at the expense of tax paying Americans. Disingenuous statements proclaiming that taxpayers are being paid back through appreciating GM share price neglect the facts that the taxpayers are losing money in other areas such as the $45 billion tax write-off given to GM by the US Treasury.
BananaRepublic,
Why do you wage class warfare on yourself?
Let’s see, $625 million is, uhm, what? Approx ONE TENTH of $700 BILLION?
The $700 BILLION? TARP. You remember TRAP, right?
DOINK!
Disregard. Got distracted.
My bad.
Egypt Unrest: Can Money-Printing Solve Crisis?
So far there has not been a problem anywhere that has not been solved by our leaders throwing money at the matter.
big ben does not agree.
Remax….. Ripping off families one house at a time.
Has anyone else noticed HorseFace Margaret Kelly/Remax spinning up their TV ad lie campaign?
We don’t have a TV, only a monitor set up for movies and my Golden Girl Collection. What’s the jest? This ad campaign is pushing your button, I can tell. Dish.
I went house shopping this evening, and I’m bummed. Flips and properties not worth getting out of the car for (L A is cold and windy). Fugly in person, but I’d buy the talents of the MLS photographer.
“This ad campaign is pushing your button, I can tell. Dish.”
It’s the same old lies except they use a false dichotomy between 2006 prices and todays prices. She serves up a seething $hitpot of typical lies and acts as if prices are at rock bottom. And the dumb-a$$es out there believe it.
exeter
I hear you on the gullible comment. In So Ca, homes with my criteria are sitting overpriced and the DOM are adding up. I meet buyers who say they are getting educated. I’m not so sure Remax’s propaganda will be as effective as prior campaigns.
Investment Confidence Surges -A 2011 Special Report-Retail Traffic Magazine
Low interest rates, improving fundamentals
fuel acquisition plans
http://retailtrafficmag.com/MM2011v17.pdf