Bits Bucket for August 13, 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
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There’s some bi-polar action in my ‘hood. There are two 3/2 homes very similar to my rental that just closed, one for $285k and one for $182k.
I viewed both and there wasn’t much difference other than superficial things like paint. I guess someone had a pretty big box of stupid and wasn’t afraid to use it!
Were these in So. Hillsborough Muggy? If so, then 285k sounds like way too much for that area. Even 182k sounds rich.
Muggy’s in Pinellas. I’m in South Hillsborough and you’re right. Even 182k IS rich. $90,000 would be more like it.
Sorry, guys. I often confuse the two of you since you’re both in the Tampa Bay area.
No need to apologize. I call it my “geographic filter.” I occasionally get all twisted, too. I can’t remember who it was, but for the longest time I thought they were a FL poster, and they were CA.
“There are two 3/2 homes very similar to my rental that just closed, one for $285k and one for $182k.”
This is evidently a market in severe disequilibrium. The most likely explanation for those divergent list prices is the amount owed on the loan; my guess would be the owners of the home listed at $285K owe a lot more than those who own the $182K listing. If I were a gambling man, I would bet the $182K-listed home will sell quickly, while the $285K home will sit on the market until it either rots away or the sellers lower their asking price. Buyers could not care less about which owner of two identical houses owes the bank more money; the buyer’s interest is simply to buy the best home they can for a certain dollar amount or to pay the least amount possible for a home of the same quality. How-much-underwater is a problem for the lender and the underwater owner to work out, unless government bailouts are available to put other innocent parties on the hook for the failed mortgage loan.
Muggy said both homes recently closed.
“There are two 3/2 homes very similar to my rental that just closed, one for $285k and one for $182k.”
He actually didn’t clarify whether those were list prices or sold prices. My interpretation was that his rental closed, but the two 3/2 homes were currently on the market.
My bad - the two other houses recently closed. I pay $1,100/mo. for perspective.
If I were to “buy” with 20% down my current owner would need to sell to me for $135k to keep the monthly at $1,100 (insurance is insane).
For a bit more perspective, $1,100/mo on a 30-yr fixed loan at 4.307 APR (roughly the going rate) has a present value of about $222,000.
“There’s some bi-polar action in my ‘hood. There are two 3/2 homes very similar to my rental that just closed, one for $285k and one for $182k.”
FBI: Mortgage fraud still prevalent, hard to catch
Nedra Pickler, Associated Press
Friday August 12, 2011, 2:41 pm EDT
WASHINGTON (AP) — Mortgage fraud remains widespread in the depressed housing market, with perpetrators motivated by high profits and little risk of getting caught, the FBI said Friday
The most prevalent schemes involve falsifying financial information to qualify buyers who otherwise would be ineligible for a loan. Other crimes involve inflated appraisals, including schemes that use dishonest appraisals to sell homes at elevated prices. Some get-rich-quick schemes persuade investors to buy rental property or land believing the price will appreciate quickly.
The top states for mortgage fraud last year were California, Florida, New York, Illinois, Nevada, Arizona, Michigan, Texas, Georgia, Maryland and New Jersey, the FBI reported.
http://biz.yahoo.com/ap/110812/us_mortgage_fraud.html - -
Someone is going to upgrade kitchen/baths and the other is going to live w/their purchase as is?
Are they still doing cash out purchases?
Normally when the appraiser went out and there was that much difference in price the appraisal would come in lower and the buyer would either make up the difference in down payment ,or they would drop out of the transaction because of the appraisal
coming in low .
You got so many different prices going out on the same house product in the same neighborhoods that the appraisers must be tearing their hair out .Are the appraisers ignoring forclosure sales even when they make up a hight percentage of the sales activity , I don’t really see how they can do that ?
The new economy
Ottawa, Canada (NTN24 Wires) - A group of Canadian manufacturing employees won a 7 million US dollar lottery jackpot, just days after their company announced massive layoffs and the closing of their plant.
The 18 workers at Smart Technologies in Ottawa announced on Thursday that they had won the Lotto. Each worker in the pool will get nearly 400-thousand US dollars each.
“We all know that $400,000 doesn’t make you rich,” said winner Tony Mather, 50, in an interview with CBC. “That comfort zone for the rest of your life is the nice story.”
SMART Technologies confirmed on Wednesday to CBC that it was laying off 200 of its 300 assembly plant employees in Ottawa. Manufacturing will move to Mexico.
“Manufacturing will move to Mexico.”
Who was the poster who said the jobs move to Mexico while they export to us that part of the population they don’t want? I’m being kind, I think the poster used the term “human refuse” or something like it.
Excuse me, “human wreckage” was the term.
Moi……I think I used the term “wretched refuse”
Borrowed it from somewhere………
Teeming masses yearning to breathe free?
Exporting “human refuse” is a double win for Mexico:
1. Mexico sheds from itself the financial burden of supporting unemployed workers, so…
2. These unemployeed workers become employed workers somewhere else and send big chunks of their earned money back to Mexico.
Thus exporting their unemployed decreases expenses and increases revenues.
Any chance the US could export any of its vast stockpile of human refuse? Obama wanted to boost exports…
Other countries are not a stupid as we are. They protect their job bases instead of offshoring or importing cheap labor.
Let’s export some of our “Celebrity Skanks” to China. They say they are short of women over there.
Starting with the Kardashians, any girl who has had more than two kids before 18, and everyone that has ever appeared on a reality show.
After taxes that makes $200,000 US dollars. I figure they could each use that for four years of living expenses and maybe go to some trade school for a couple of years to reinvent their skills for something currently in demand. Not bad.
It’s better than you think. Cash and merchandise lottery prizes are tax-free in Canada. The only time there may be tax implications is if an annuity option (if available) is chosen.
“Cash and merchandise lottery prizes are tax-free in Canada.”
Wow! Do you have to be Canadian to be eligible?
Of course not … I never pay any taxes in Canada on my US lottery winnings.
But I do have to pay US taxes.
Wow! Do you have to be Canadian to be eligible?
Afraid so. And Canadians can also apply to have refunded, any taxes withheld from U.S. lottery or casino winnings.
Banks continue to struggle with housing fallout, despite bailout
By Brady Dennis and Jia Lynn Yang,
Published: August 9
Nearly three years after the government infused the banking industry with hundreds of billions of taxpayer dollars, many large banks continue to struggle with the fallout of the housing bust.
Chris Whalen, a financial industry analyst and managing director of Institutional Risk Analytics, says government officials erred by failing to restructure the banks in the wake of the crisis by making them smaller and forcing them to acknowledge the depth of the losses.
“Here we are and the markets are getting antsy” again, he said. “If we [restructured banks] two years ago, we’d be done.”
http://www.washingtonpost.com/business/economy/banks-continue-to-struggle-with-housing-fallout-despite-bailout/2011/08/09/gIQAHhma5I_story.html - -
It’s certainly beginning to look as though the TARP and other bailouts amounted to money poured down rat holes.
Not to Wall St., it doesn’t.
What I said.
We had more mortgage debt in 2011Q1 than we had when houses peaked in Q22006. Mortgege debt continued to increase for 21 months after house prices peaked. In fact mortgage debt increased much faster in those years from peak house price to peak mortgage balance outstanding, than it is falling from that peak.
At my best guess, no more than 1/4th of the debt that needs written off has been. Probably more like 1/6th to 1/8th.
As for TARP, most has been returned. We pumped stocks, then dumped our shares to get our money back… That should end well.
How is this possible? Do you have a link?
Hope&change baby! We can do better, do I hear 60% next year?
Average Teen Unemployment Rate in D.C. is 50.1%, Analysis Shows
August 12, 2011 By Penny Starr
(CNSNews.com) – An analysis based on U.S. Census Bureau data by the Employment Policies Institute (EPI) shows that the average unemployment rate for teens ages 16 to 19 in the District of Columbia was 50.1 percent as of June 2011. This corresponds with data from the Bureau of Labor Statistics (BLS) showing that for D.C. the annual average unemployment rate for teens in 2010 was 49.8 percent.
Michael Saltsman, research fellow at EPI, provided the 50.1 percent figure to CNSNews.com as an update of an analysis he compiled based on the Census Bureau’s Current Population Survey.
The 50.1 percent figure is almost double the average teen unemployment rate in June 2007 in the District, when it was 26.2 percent, according to Saltsman.
Since 2007, the rate has increased each year: 29.5 percent in June 2008, 44.7 percent in 2009 and 48.8 percent in 2010, based on EPI’s analysis.
“We’re in the midst of the third summer in a row where teen unemployment has been above 20 percent,” Saltsman said when he announced his report on July 8.
Now, the presstitutes would have you believe that American teens don’t want to work, they just want to bury themselves in Facebook or x-box or whatever it is the presstitutes say that kids do these days. Pure propaganda, it’s meant to degrade decent kids.
Our local fishwrap carried a story recently about some woman who owned a local retail business getting something like 90 resumes A WEEK from kids looking for summer jobs. Her response? It was how awful the resumes were, so she decided to give a little seminar for $10.00 a head on how to write a decent resume/job application. Guess business must be slow for her and she sensed an opportunity. Frankly, the story made me sick.
Nothing wrong with both helping and profiting at the same time, but taking $10.00 a head from desperate kids, who, even if they had glowing resumes, wouldn’t be able to find a job, is a bit opportunistic IMO. See, in this area, an enterprising kid who goes out and tries to get a gig cutting lawns runs into Mexican landscaping crews. Same if they want to pick crops or work in the packing plants. If they can find someone willing to pay for a sitter, maybe, but that’s not steady. Other part time work is already spoken for, often by retirees.
But, if the enterprising employer above wished to do something, maybe she could get together with the Chamber of Commerce and put together a little summer job agency for these kids.
And also, maybe the retirees who are bagging groceries at Publix could team up with a kid and take a summer vacation while the kid does their job for the summer.
Palmy Wmbz…Still the same question, can they read write and speak English, do simple math problems and make accurate change in case the computer went down? Probably not.
A few years ago big mall opens in Harlem top priority is placing local people in jobs…same problem…lack of basic skills
Who’s at fault the teacher? principle? the administration? Just who lets these kids graduate and cant make change or add and subtract on a piece of paper with a pencil?
My kids are very literate (AP in HS, dean’s list in College) and they struggled to find summer jobs. My college age daughter works side by side with college grads at her P/T job at Old Navy.
The college grads make a whopping $9/hr as “assistant managers”. I wonder why they haven’t run out and bought a house yet?
And this demonstrates - what? That maybe the forces of deflation are at hand?
When the Fed shuts off the printing press I will agree with you. Until then M1 and M2 will continue to grow, driving up the prices of commodities that affects the average American at the gas pump and grocery check out line.
And this demonstrates - what?
It demonstrates that the economy is not doing well. It;s hard for young people to find a job. It’s very hard to find a job that pays well with good benefits. Really Colorado’s kids are lucky to have summer jobs at Old Navy.
It demonstrates that companies have been outsourding.
Quit banging the deflation drum. Outsourcing put a hole in the delfation drum 20 years ago.
What are you suggesting? That outsourcing American jobs is not deflationary to those workers in the U.S.?
If Americans are going to compete with people who will work for some small percentage of what Americans are used to earning then the Americans are going to have their wages priced out of the wage market - which is what has been happening.
If American workers wages are destined to continue to fall then there will be less money earned to circulate in the American economy.
This should be a no brainer but for some reason it isn’t.
yeah i let auto correct make a mizztake…principal..
The Wegmans near us is mostly kids behind the training signs. I don’t think the elders can handle the long hours in the same position hunched over the register. About a six mos - year ago I did see more retired types and they often mentioned sore shoulders and backs.
Over at hedge fund owned Tops the cashiers are all either elderly or kids. They’re dressed in these horrible looking cheapest on the shelf tee shirts. I know someone who works over there and she said none of the new people are even trained. They walk around clueless to the point where even they know it’s a joke. She said last Monday during the big market crash they were marking up prices on everything and it was big jumps like 50 Cents an item. Not like 5 or 10 cents like in the past.
Carrie: Ive saying for a long time they fired all the smart people and now we have to deal with the leftovers..
she said none of the new people are even trained
Another sign of the “figure it out yourself” economy. Thank goodness for FAA rules or people like xGS would be expected to fix airplane problems without a manual or being certified.
Damn government regulations!
Oh wait…
Porsche July Sales Fall as 911 Demand Drops
(Bloomberg)
Porsche AG, the maker of the Cayenne sport-utility vehicle, reported a 4 percent decline in auto sales in July, burdened by a drop in demand for the aging 911 sports car.
Deliveries fell to 10,722 vehicles last month from 11,169 a year earlier, the Stuttgart, Germany-based company said today in a statement. The decline, which comes as Porsche prepares to show a revamped version of the 911 at the Frankfurt Motor Show in September, marked the first monthly drop in car sales since May 2010, said Dirk Erat, a spokesman.
Porsche, which is being integrated into Volkswagen AG (VOW) as part of a merger with parent company Porsche SE, aims to double deliveries to at least 200,000 cars and SUVs by 2018 by adding models and expanding in emerging markets. Luxury-car brands tend to be more resistant to industrywide sales declines than mass- market manufacturers because their customers still have money even when economic growth slows.
“We are looking confidently at the next few months and believe that new vehicles like the Panamera diesel will underpin sales figures in Europe,” Bernhard Maier, Porsche’s sales chief, said in the statement.
A $45-50K Porsche 911 might sell pretty well.
Trouble is, MSRP is something like 90K. For no good reason that I can see, other than the fact that there used to be a unlimited supply of people willing to pay crazy prices for anything with “Porsche” on it.
911’s are also hard to drive because of their rear engine design. If you know what you’re doing they are quick around the curves, but very unforgiving if you make a mistake unlike a typical FWD car.
Definitely a status symbol, with a lot of competition at or below its price point from other German brands. And in Europe there are a lot more “exotic car” choices than in the USA.
Most Americans can’t afford a $1,000 emergency expense
By Jessica Dickler
August 11, 2011: 11:19 AM ET
NEW YORK (CNNMoney) — When the unexpected strikes, most Americans aren’t prepared to pay for it.
A majority, or 64%, of Americans don’t have enough cash on hand to handle a $1,000 emergency expense, according to a survey by the National Foundation for Credit Counseling, or NFCC, released on Wednesday.
Only 36% said they would tap their rainy day funds for an emergency. The rest of the 2,700 people polled said that they would have to go to other extremes to cover an unexpected expense, such as borrowing money or taking out a cash advance on a credit card.
http://money.cnn.com/2011/08/10/pf/emergency_fund/index.htm - 54k -
“A majority, or 64%, of Americans don’t have enough cash on hand to handle a $1,000 emergency expense …”
What? Sixty-four percent? That means Thirty-six percent of Americans DO have enough cash on hand to handle a $1,000 emergency expense!
This is an outrage! Despite all the work that has been done dumbing down Americans financial wise there is still some cash out there for the dummies to spend.
I have more cash than that hidden at home.
So … where do you live?
Beat me to it combo…
She hides it in the pantry. Look next to the oatmeal.
I’m a Southner. It’s with the grits
“What? Sixty-four percent?”
Considering that half of wage earners make less than $500 a week this is a surprise because?
You’d think that most people would at least have an IRA or 401K they could tap into should a real emergency arise but even cube dwellers, especially young ones, are prone to buy a hot car as opposed to saving anything in their 401K, even foresaking the company match.
“Considering that half of wage earners make less than $500 a week this is a surprise because?”
The only surprise I am getting today are posts from you illustrating how deflationary forces are running rampant all over the land.
They’re running rampant, but prices continue to rise at a healthy clip. You can explain it away all you want, but at the end of the day everything is more expensive (except for houses). Consumer prices will not fall as you have been predicting for what, the past 4 years now? And with each QE it’s only going to get worse. It doesn’t matter if J6P is broke, the dollar’s value will contine to plummet, driving up prices steadlily and relentlessly.
To borrow a line from the remake of Battlestar Galactica.
“It has happened before and it will happen again.”
Dude, I’ve lived in a country where nealry everyone was so broke and poor that J6P was a tycoon by comparison. And prices kept going up, because they wouldn’t stop running the printing press. None of that cash wound up in Juan Six Packs wallet, and it didn’t matter. Prices kept going up until they stopped the printing presses.
“You’d think that most people would at least have an IRA or 401K they could tap into……but even cube dwellers, especially young ones, are prone to buy a hot car”
This is a tough equation nowadays. The prime motivating factor in human behavior, for singles anyway, is the need to find a mate. Or for single males, just getting some o’ dat. Question: In this economic climate, would more young, single gals be just as impressed by a guy who is frugal to a fault as she is by the one with the cool car? Might seem like a stupid question, but I’m an example of Mr. Frugal, and my wife says that my cheapness was attractive! (And still is, I hope)
“A majority, or 64%, of Americans don’t have enough cash on hand to handle a $1,000 emergency expense, according to a survey by the National Foundation for Credit Counseling, or NFCC, released on Wednesday.”
That’s because they’re poor decision makers.
Right. All of them.
Some of them decided to eat and have a roof over their heads instead of socking away $1000 after life pulled the rug out from under them. I am pretty frugal and like to carry a cash cushion, but there have been times when I have been broke - with small children.
“Right. All of them.”
“A majority, or 64%, of Americans…”
Guillotine display stuns Rothschild’s ‘tent city’ - Ynet News
French Revolution symbol becomes main attraction at Tel Aviv’s protest center, as rallies continue to spread across country. Protest leaders say Beersheba to hold next mass rally
A guillotine, the symbol of the French Revolution, has been placed Wednesday in the center of Tel Aviv’s “tent city,” turning into one of the biggest attractions in this ongoing social protest.
The surprising display arrived in Rothschild Boulevard following another long night of protests across the country, this time focusing on contractor conditions. Demonstrators in five different cities participated in rallies Wednesday night against working conditions, wearing white masks and chanting: “Contractor companies are organized crime.”
In Beersheba protesters organized a ‘bathing suit march’ to exemplify how the social protest “has taken off.” In Bat Yam hundreds of residents marched to protest against the high costs of living and housing shortage, clashing with the police’s Special Patrol Unit.
Holon protesters intensified the upheaval by burning tires and furniture, demonstrating against the city council’s attempt to vacate the premises. Meanwhile, haredi and secular protestors rallied side by side in Jerusalem against the shaky public transportation in the city.
Transportation Minister Yisrael Katz re-visited Tel Aviv’s “tent city” on Thursday to present the new public transportation plan before protesters, after the recent reform was harshly criticized.
“I think the message is that eventually nothing can be solved without dialogue. I am here as a government minister and member of the socioeconomic cabinet, which is supposed to stand guard,” Katz said.
Referring to his transportation reform program, dubbed ‘Israel’s Throughways’, Katz noted that its goal was to expand the national rail system so that residents of the Galilee, Negev and Jerusalem could reach the center with greater ease.
“In several years’ time, Israel will be a different nation, more connected and more equal. The equality in infrastructure across the country will provide equal opportunity to anyone who wants to live here and work there, while establishing factories everywhere,” he added.
Social protest leaders announced Wednesday night that they have reached an agreement regarding a unified leadership to represent the assorted protests.
The upcoming mass rally on Saturday will be held in Beersheba this time around, after protest spokesman explained they had “decided to emphasize the periphery’s place in the protest. We are all a social periphery.”
“Contractor companies are organized crime.”
Ain’t it da trute!
But just remember folks, corporations are people, too!
Good for the Israelis! Apparently their own rich expect everyone’s kids to serve in the military (while their kids attend college in the USA) and to work for low pay. AT least they have the stones to complain.
We need our own guillotine in front of the Capitol building to remind our leaders of their “conscience”.
Make an extra for K Street plz.
Faux is about to eat crow and concede that Ron Paul won the Ames Iowa poll last night. Look at the numbers. Blasted away the Bible thumpers and Rhinos and war mongerers:
http://www.topix.com/issue/fox/gop-debate-aug11
Evenif he is elected he still will have a corrupt congress to deal with.
But he could veto.
Feh, stick a fork in him, he’s done. Don’t get me wrong, for the most part, I like the guy. But there’s NO WAY the Republican party will EVER run him.
Huntsman. You heard it here first. Yech and blech…
Huntsman. You heard it here first ??
Evangelicals will “NEVER” support a Mormon… Philosophically they are polar opposites…Christ reins and life itself is plays out by his hand…For the other, Christ was no more than a missionary and they recognize very little of the story of him…
The fundies will fall behind Bachmann.
The Mormon is probably out anyway since he’s been going around saying Corporations are people too. I think his argumentative viral video might be his siren song.
I know I wouldn’t vote for the guy.
‘Evangelicals will “NEVER” support a Mormon…’
I don’t know… politics breeds strange bedfellows, as they say. If it came down to a choice of Romney (Mormon) or Obama (allegedly a closet Muslim), whom do you think evangelicals would choose?
Evangs and Fundies see the LDS as the greatest threat to what they consider the true form of Christianity. Just walk into a Christian bookstore and ask where the “cults” section is. You will find that anti-Mormon books take up more than half the shelf space.
Colorado, I avoid those bookstores like the plague. I just cannot grok the concept “faith.”
“The fundies will fall behind Bachmann.”
I’m thinking Obama has great reelection prospects, if for no other reason than because fundamentalist religion will divide the Republicans into rival factions which are almost as willing to compromise as Tea Partiers negotiating on the debt ceiling.
“Evangs and Fundies see the LDS as the greatest threat to what they consider the true form of Christianity.”
It’s been this way in the U.S. ever since Joseph Smith dared to run for president as a Mormon candidate, shortly before his assassination.
Stephen Colbert made a hilarious mockery of the perspective that Mormonism is somehow weirder than other Judeo-Christian belief systems just a few nights ago.
Wednesday August 10, 2011
Yahweh or No Way? - Mormons & God’s Poll Numbers
The Mormon Church’s PR campaign makes Mormons irresistibly cool, while only 52% of Americans approve of God.
It was only the electioneering from Rove that joined the religious wackos and conservatives together to re-elect Bush in 2004. I don’t think the evangelicals will set up van pools to the polls to vote for a Mormon or even a moderate.
Ron Paul? Nobody will set up a van pool to vote away their SS and Medicare. Ron Paul has put out enough material for an entire movie’s worth of campaign commercials.
Colorado, I avoid those bookstores like the plague. I just cannot grok the concept “faith.”
I didn’t say that you had to buy anything
But if you really want to understand what makes Fundies and Evangs tick, go find out what they read.
And the most freakish thing is that there is nothing “Christian” about fundies and evans.
I do not think he can win, but I will be voting for him again.
Who exactly are the “RINO’s” to which you refer?
RINOs (Republican in Name Only) are those who talk the talk of small government but they vote for big spending programs, whether military or prescription medical benefit crap. John McCain in 2008 during his campaign promised a $100 billion bailout to home moaners. John McSame is King of the RINOs.
The Republican Party before 1980 was mostly separated from religion. But the Bible thumpers hijacked it. Barry Goldwater was furious at the religious right. He was the last of the classic Republicans. Ron Paul is very close, although he is not pro-choice.
Ron Paul has his consistent voting record. I posted a YouTube video below where in 2001 and 2002 he makes eery predictions of the housing bubble (2001) and the escalated polarization between the big government fans of the right and the big government fans on the left that have recently been occuring “Tea Party versus those who call TP “tea baggers”
I was attempting to be facetious in my post.
I think it would be more appropriate to refer to Ron Paul as a “RINO” in the way of a compliment.
Barry Goldwater was likely also a RINO for his day. And everyone else currently in the mix is pretty much standard fare for the GOP today, and has been for the last 130 years at least. IMO
I don’t know much about Goldwater. From what I know about Ron Paul, he is a tool.
A tool of who? The wealthy? He opposes NAFTA and wants to end the Fed.
“Ron Paul is very close, although he is not pro-choice.”
This irks me no end. It’s apparent to me that he is only saying this because no pro-choice Republican can be nominated at this time. His libertarianism comes from his core, and this one issue is the only exception? Unlikely. Unless my impression is wrong, he’s coming across as a sell-out. To a lesser degree than most, but still a sell-out.
Much in the same way that I’m sure Obama, in his heart, supports gay marriage right, but will only go as far as to support civil unions, just like most of the Republicans. But it irks me more when Ron Paul hedges like this, because I expect better from him.
Faux is about to eat crow and concede that Ron Paul won the Ames Iowa poll last night.
You know, I saw something somewhere about Rush Limbaugh criticizing the debate that Fox hosted the other night. He thought that the questions being asked of the candidates were encouraging them to attack each other instead of going after the president.
Shouldn’t the forces of the right - Fox, Rush, GOP, Tea Party - all be working together? I think that this could be a big new story of the next year, the conflict among all of these folks.
Michelle Bachman won the Iowa straw poll 29% of the votes. Ron Paul came in second at 28%. Ron Paul won the Iowa online poll.
SF Chronicle claims Ron Paul won the debate though.
Sorry for another post, but the lady beat Ron Paul by only 152 votes. Not a clear victory for her.
Bachmann wins Iowa straw poll, Paul ends up second
This lady nailed it. The Fed’s delusional idea that keeping rates low through 2013 will somehow revive the housing market is about as likely to work as beating on a dead horse. We are going Japanese, and their low rates did nothing to stop residential real estate for dropping in value for two decades straight.
Real Estate Markets
Why the Fed Announcement Won’t Boost the Housing Market
By Alison Rogers | @RE_Rookie | August 12, 2011
The Federal Reserve’s announcement this week that it would keep a key interest rate near zero seemed designed to be a chill pill — a way to calm jittery stock market investors by showing that it recognized, and was trying to manage, economic weakness. Whether the announcement was good for real estate is another story.
In a normal world, mortgage rates would track the Fed’s benchmark rate. And indeed they have, with 30-year fixed mortgages dropping to 4.32%, near the historic low of 4.17% they hit in November.
However, normal world step 2 would be for those low interest rates to encourage housing consumption. If the government is going to effectively subsidize loans, then the play should be to take out a loan and buy a hard asset with it. For most of us, this means buying a house or an apartment.
The problem is that we’ve already been in a low-interest rate environment for years. When I bought my current place two years ago, I remember nervously watching the mortgage market with the hope of getting an adjustable rate below 5 percent. Fixed rates at the time? In the low fives.
To anyone with a historical sense of the housing market, these were themselves laughably low rates. We spent most of the 1980s in a double-digit interest rate climate. Anything below 6% on a 30-year-fixed — which is where we’ve been for most of the past few years — is basically free money.
But you can’t make something more free. Homebuyers who were going to take the mortgage rate subsidy and buy property already have; keeping rates low may attract a few new entrants to the homebuyer ranks on the margin, but it isn’t going to cure the housing crisis.
…
It’s the lack of decent paying jobs and the lack of job security that counts. Most people who are renting are by now aware of the trap that home buyers got themselves into during this RE bubble. Most are aware of high paying jobs going overseas, of more layoffs here.
And this government keeps trying to make them debt slaves. That is retarded.
And this government keeps trying to make them debt slaves. That is retarded.
That should tell us who the gov’t really works for.
“This should tell us who the gov’t really works for.”
It should, but it doesn’t. Most people don’t seem to “get it”.
The people who got us in this mess are the ones most people are relying on to get us out. Strange thinking, IMO.
I especially think it strange that economists are continuiously “puzzled’ by all of this and use the word “unexpected” a lot.
Not may people that post here use the word “unexpected” but then again most of the people here are not economists.
It appears to really understand what is going on economy wise one has to shed what they have learned about the economy in school and replace this knowledge with what their own eyes are telling them.
I especially think it strange that economists are puzzled about what is wrong with what they term our “consumer-based economy”.
The term “consumer-based” is what is wrong with our economy, IMO, but these pundits never seem to get it.
They are so close to it that they somehow cannot see it.
But the poor schmuck that just had his job moved overseas to some “production-based” economy certainly sees it.
“Not may people that post here use the word “unexpected” but then again most of the people here are not economists.”
I guess that if I had a cushy six figure job where I was supposed to make rosy predictions I would find myself forced to use the E word a lot myself.
“But the poor schmuck that just had his job moved overseas to some “production-based” economy certainly sees it.”
As do many who still have a job.
I guess we’re gonna die of “consumption”
“As do many who still have a job.”
And these “many who still have a job” are going to cut back on their consumption, and we live in a consumer-based economy so this consumption cut-back will take a lot of jobs - domestic jobs, jobs that depend on consumption - out of the picture.
It ain’t just the jobs that are destined to be exported that will be lost.
I think a lot of retailers are already working with bare bones skeleton crews. I see this when only one cash register is open with a long line or there isn’t a clerk to ask a question. For instance I ran into Sam’s club last night to buy some pork chops on my way home. There were only 3 registers open and they all had long lines.
When that happened in the past and I had a single item I would go to the service desk and pay there. Last night there was a single clerk at the service desk and she had a long line too.
When I have this experience I just abandon my basket or goods and just walk out. I don’t need to give them my money that badly. Although I will take the refrigerated items back to a cold place. And I’ll dump the bacon and the butter and the roast beef all in the roast beef section. F’em.
Which decreases their revenue so that they cut back even more.
Now I feel bad that I live in a relatively good area. There is some cutting back, but not the severe hardship of most of the country. I think it will hit eventually when the government does some real cutbacks. The gov will probably not do a huge reduction if force, but they will cut back on promos and contracts and travel. Even if the gov workers keeps his job, the spouse may lose theirs, and housing around here is definitely two-income-trap territory. That’s why someone like me, who is paid professional class, can only afford a working-class house. You now need two incomes to afford what used to be a professional class house.
“Which decreases their revenue so that they cut back even more.”
There you go again, describing a deflationary spiral - not an inflationary one, a DEFLATIONARY one.
Can’t you see?
“That is retarded.”
It’s worse than retarded, Bill. It’s fatal.
I am not sure it was intended to boost the housing market. More likely, it was intended to get people to borrow on short 3, 6, 12 month loans then loan it out at slightly longer 2-3 year loans.
You an be pretty safe that you wont have rates go up under you, so the risk is ability to get paid back.
Turning Japanese
I think I’m turning Japanese
I really think so
…guitar riff…
Turning Japanese
I think I’m turning Japanese
I really think so
SF transit blocks cellphones to hinder protest
By PAUL ELIAS - Associated Press
AP – 5 hours ago..
SAN FRANCISCO (AP) — Transit officials blocked cellphone reception in San Francisco train stations for three hours to disrupt planned demonstrations over a police shooting.
Officials with the Bay Area Rapid Transit system, better known as BART, said Friday that they turned off electricity to cellular towers in four stations from 4 p.m. to 7 p.m. Thursday. The move was made after BART learned that protesters planned to use mobile devices to coordinate a demonstration on train platforms.
The tactic drew comparisons to those used by the former president of Egypt to squelch protests demanding an end to his authoritarian rule. Authorities there cut Internet and cellphone services in the country for days earlier this year.
“BART officials are showing themselves to be of a mind with the former president of Egypt, Hosni Mubarak,” the Electronic Frontier Foundation said on its website.
The American Civil Liberties Union criticized the tactic, saying on its blog that it was the “wrong response to political protests.”
http://sg.news.yahoo.com/sf-transit-blocks-cellphones-hinder-protest-073230984.html - -
That is a MAJOR federal offense and BART just bit off more than they can chew.
In other words, a VERY expensive mistake.
“In other words, a VERY expensive mistake.”
As in:
“I tried to dial 911 but the cell phones were cut off so I couldn’t get an ambulance for my children and so they all ended up dead. I feel terrible and so should you guys. I want a hundred million dollars to help alleviate my pain.”
If Shiller thinks stock prices are historically overvalued, wouldn’t the correct long-term investing advice be to pull money out of stocks for now, then get back into the market at a point when the values become more attractive by historical measures? Why are financial ‘experts’ always dispensing advice which might lose money for individual investors?
Questions remain after stock market’s wild week
Investors struggle to know whether to sell everything or buy with abandon.
By BERNARD CONDON
Published: August 13, 2011
NEW YORK — Is it time to sell everything or buy with abandon?
Investors can’t make up their minds. This was one of the most volatile weeks in the history of Wall Street. The Dow Jones industrial average swung more than 400 points four days in a row.
It’s frightening, but experts say the fear results partly because memories of the financial meltdown of 2008, when stocks lost half their value, are fresh.
Their advice: Hold on. It’s not time to sell, but it’s probably not time to pour money into stocks, either.
“The stock market has done so well historically that, even if it is overpriced, you’re likely to do OK,” says Robert Shiller, a Yale University economist famous for having warned against bubbles in technology stocks and housing.
Though he believes the stock market is still overvalued by historical averages, he says it is closer to fairly valued than before. He suggests investors move their money “modestly” into stocks.
…
I’m still staying the course. I am enjoying buying more shares at the same amount I invest every week. And VFINX is yielding about 2% right now, which is fine for me.
Cannot dollar cost average into real estate, but you can rent a very nice place for $2,000 per month away from the riff raff.
For the record, there is no reason you cannot dollar cost average into real estate, e.g. through REITs. I suppose if you are worth billions, you could also dollar cost average into single-family housing, so long as each home you bought was a very small share of your wealth.
A colleague in 2007 sold me three ounces of gold for $800 per ounce and told me at the time he was going to use the proceeds to buy VGSIX. It’s a REIT. He has not recovered fully from the loss he took on the $2400 from 2007 to now, but if he dollar cost averaged, maybe he would be ahead of the game.
It would be interesting to ponder that if the government gets rid of MID and reimplements the capital gains tax on your primary residence, REITS would certainly be a better deal than owning one house and hoping it would increase in value.
“VGSIX”
I started gradually accumulating this last year. I plan to continue building my holdings as a hedge against real estate price (and general) inflation during a time when I am not a homeowner.
Good move on your part PB.
Bad choice for my friend in 2007. My three ounces I bought for $2500 (I even included commission because I knew I had a better deal) can get me $5300 if I could walk into my coin dealer today (they are open on weekdays only) and I can walk out with the cash within ten minutes.
NEW YORK — Is it time to sell everything or buy with abandon?
Investors can’t make up their minds.
computer algorithms can’t make up their mind, or are having a hard time manipulating the market in the right direction.
Fixed it.
We have a winner!
Sheriff: Rapper incited phone flash mob on Twitter
AP – 3 hours ago..
LOS ANGELES (AP) — The Los Angeles County sheriff’s department says The Game incited a telephone flash mob that overwhelmed the emergency phone system.
Capt. Mike Parker tells the Los Angeles Times (http://lat.ms/oGFHO1) that the rapper tweeted the number of the Compton station Friday and told his 580,000 followers that if they wanted an internship with him, they should call the number.
Sheriff’s Lt. Suzan Young says “the phones started ringing like crazy” around 5:20 p.m. Parker says phone lines were jammed for more than two hours.
The rapper later posted that his account was hacked but also tweeted that it was “an accident.”
http://in.news.yahoo.com/sheriff-rapper-incited-phone-flash-mob-twitter-075223919.html - -
I was worried these retarded types would try to incite an England-style riot. I see BART in SF shut down cell phone usage for a period.
Hmmmmm….
If one wanted to rob a business and could flood 911 with junk calls at the same time to prevent police intrusion then his chances of getting away would be increased.
I do not supposed this thought has been lost on the bad guys.
This cell phone jamming phenom has some very interesting possibilities attached to it, which implys there will be much more jamming to come in various forms.
There’s all kinds of chaos that can be created; it only requires the will to do so. The PTB don’t have a clue as to how close our infrastructure is put together with patches, bubble gum, and duct tape.
Like using helium balloons to float wire into high voltage power lines, taking out selected portions of the power grid.
Or setting a couple of junk cars on fire at the approach end of a major/hub airport’s runway. Or on the Amtrak NE corridor mainline.
Simpler yet, just have a mob of kids bum-rush past the security checkpoints, and immediately leave, before they TSA can lock down. The airport will be shut down all day sorting that out.
If I were of a criminal mind, I’d hit those dumbazzes at the “Storage Wars” auctions. Lots of cash, all in one place. Sure, some of those guys are carrying concealed, but nobody is going to flinch, with an AK jammed in their face.
If I were in a “Sacrifice my life for the Greater Good” state of mind, I’d do what the Tunisian street vendor did.
In the lobby of the new Goldman Sachs Headquarters. Think how long it would take to get rid of the smell.
IMO, it isn’t the kids that the PTB need to worry about. It’s the old guys who know where all the weak points are.
As the say, age and cunning usually trumps youth and inexperience.
Speaking of which, just remember what happened after they thought they had arrested everyone associated with Anonymous.
But you’re right X-GS, they really don’t have a clue. It’s pretty much all magic to them and the peons take of it.
Did you ever notice how used home sellers try to use every financial uncertainty that comes up in an attempt to scare fence sitters into buying sooner? Take the debt ceiling: Any fool can see that if Uncle Sam goes through with planned federal spending reductions, revenue flows through the economy are likely to drop, unemployment is likely to go up, loanable funds (including those for mortgage loans) will become scarcer, and housing demand will weaken. This sounds to me like a recipe for falling (aka “more affordable”) future housing prices, which would be a rational reason for a prospective buyer to sit on her hands and wait a while longer before buying.
Yet this used home seller is insinuating that “nobody knows what is going to happen next,” so you had better lock in a low rate loan and buy as soon as possible. I suppose it is quite easy for a dimwitted used home seller to overlook the fact that scarcer loanable funds and higher interest rates would actually reduce housing demand, which economic theory predicts would result in lower (aka “more affordable”) prices, once the market adjusts to the new scarce money reality.
Debt Deal Will Have Affect on Housing Market, Says Burlingame
REALTOR Mary Ann Teixeira
Burlingame, CA (PRWEB) August 12, 2011
Burlingame REALTOR Mary Ann Teixeira says that the debt deal and decrease in credit standing of the government not only affects the stock market, as have been seen the past few days, it will trickle down through the rest of the economy-especially to the housing market. Potential homebuyers need to know the facts.
“We are navigating a precarious course with the financial markets right now,” said Teixiera. “With the passage of the debt deal, we will soon see it manifest itself on the housing market.”
Teixeira says that it always takes time for the impact to really be felt. Right now the sell-off in the stock market has investors placing their money in Treasury securities, and because mortgage rates track yields on the 10-year Treasury notes, interest rates are low.
As part of the long-term spending cuts that must be agreed upon this fall, lawmakers have been debating a proposal for a simplified tax structure with lower rates and elimination of tax deductions.
Right now, home loan borrowers can deduct the amount of interest they pay on their mortgages from their taxable income. The interest deduction is capped at the first million dollars of debt on the home. There is a proposal now to reduce the cap to $500,000. Currently the deduction costs the U.S. Treasury about $100 billion a year. Reducing the cap to $500,000 would save the Treasury $15 billion.
“How the long term decisions and adjustments will play out is unknown right now,” said Teixeira. “However, if homebuyers have been waiting for the opportune time to enter the market, this may be it. Interest rates are low, there is ample inventory, and we are working in a known market. Who knows what fall will bring.”
…
if homebuyers have been waiting for the opportune time to enter the market, this may be it ??
Who knows what fall will bring ??
Yeah, jump in now because who knows what the hell is going to happen…Typical contradiction salesmen talk…
All signs at all points in time suggest to used home sellers that there has never been a better time to buy.
There is no shortage of highly-confused financial ‘experts’ trying to explain the recent financial upheaval these days. Case in point: This woman blames record-low mortgage rates on a ‘bond market rout.’ Anyone who knows squat about finance realizes that lower rates are evidential of a bond market rally, as when yields fall, bond prices rise. Stock market rout — sure; bond market rout — not so much.
Mortgage Rates Hit Lowest Level Ever
By Ilyce Glink | Aug 11, 2011
The stock market might be sinking, but if you’re in the market to buy or are able to refinance a home, things are looking up.
According to this week’s new Primary Mortgage Market Survey (PMMS) from Freddie Mac, mortgage interest rates hit a new low this week (thanks to a bond market rout). According to Freddie Mac, mortgage rates continuing to decline with the 30-year fixed averaging 4.32 percent marking a new low for 2011, and the 15-year fixed, 5-year ARM, and 1-year ARM averaging new all-time record lows this week.
…
(counselor) Well, it looks like you haven`t made a mortgage payment in three years.
(folks) Really! Is that what that computer says?
“What is nice about the event is that the mortgage companies will have the ability to pull up these loans right on the computer,” “It is a good opportunity for folks to understand where they stand on their mortgage if they are behind. It is best suited for someone already behind or in some stage of foreclosure.”
Mortgage assistance event coming to Palm Beach County Convention Center
By Susan Salisbury Palm Beach Post Staff Writer
Posted: 4:00 p.m. Friday, Aug. 12, 2011
Homeowners who are behind on their mortgage payments can receive free one-on-one help at an event expected to bring 15 of the largest mortgage servicers and lenders to West Palm Beach.
Hope Now, a voluntary private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counseling organizations will be at the Palm Beach County Convention Center on Friday.
Some of the companies scheduled to be in attendance include Bank of America, Chase, HSBC, Ocwen and PNC Bank, spokesman Brad Dwin said.
Homeowners will be seen on a first-come, first-served basis and are encouraged to bring all mortgage documents, income documents and hardship letters.
In addition to mortgage servicers, several local, non-profit housing counseling organizations will be available to meet with homeowners.
“What is nice about the event is that the mortgage companies will have the ability to pull up these loans right on the computer,” Dwin said. “It is a good opportunity for folks to understand where they stand on their mortgage if they are behind. It is best suited for someone already behind or in some stage of foreclosure.”
Hope Now co-sponsored a similar event with the Obama Administration’s Making Home Affordable Program last November in West Palm Beach. Almost 1,100 attendees sought assistance.
http://www.palmbeachpost.com/money/real-estate/mortgage-assistance-event-coming-to-palm-beach-county-1733654.html - -
“Well, it looks like you haven`t made a mortgage payment in three years.”
If I had any reassurance that I could get away with that I might be tempted to do it. For some reason I’m certain that I would be tossed out in 6 months.
“These are hard measures, but they’re necessary and I think we have to reinvent ourselves because we’ve lived beyond our means and we have to lower expectations.”
Spanish towns face funding crisis, rack up debts
By: ALAN CLENDENNING
AP Business Writer
08/13/11 3:32 AM
In this hillside town, topped by a medieval castle and surrounded by olive groves, the 120 municipal workers haven’t been paid since May. Police have new orders not to use their patrol cars unless they get word of a traffic accident or a crime in progress.
The town pool is closed for the summer despite temperatures over 104 (40 Celsius) in the shade. Fees for the public day-care center have doubled. Water bills will soon go up 33 percent and local business owners are seething over €9 million ($12.7 million) in unpaid bills owed by the town hall, much of it to them.
Spain’s 8,115 municipalities are being hit by a crushing revenue hangover from a nearly two-decade building boom that went bust in 2008. Officials in Moratalla believe they are the first in Spain to publicly declare their town is on the verge of going broke — and that the only way out is an unprecedented program of drastically reducing services while boosting local taxes and fees in an austerity drive that could last eight years.
Moratalla and its mammoth debt “are the mirror image of a lot of towns” that have not yet fully admitted the extent of their dire financial circumstances, said Deputy Mayor Juan Soria. “These are hard measures, but they’re necessary and I think we have to reinvent ourselves because we’ve lived beyond our means and we have to lower expectations.”
http://www.sfexaminer.com/news/2011/08/spanish-towns-face-funding-crisis-rack-debts - -
I never understood te Spanish bubble or the perrenially high real estate prices in Spain. The country’s economy has always been hollow with low wages and few real job prospects.
Many Europeans like to retire there which causes the inflation is house prices.
Is a consortium of G-7 central banks acting as an international plunge protection team at the moment? How can markets find an equilibrium bottom with so much official intervention distorting the market mechanism?
Aug. 13, 2011, 12:01 a.m. EDT
Investors looking for stability in week ahead
By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) — After the U.S. stock market’s ulcer-and-whiplash-inducing action in the past week, investors hope earnings reports from two tech bellwethers, plus reports on jobs, housing and manufacturing, will provide a sense of stability in the coming week.
But getting to that stability may require the market finding a floor.
…
If you knew a bear market was brewing, wouldn’t it make sense to pull your stocks now and get back in at the bottom? (My sister claims to have made a fair amount of dough this way…)
Francesco Guerrera: Bear Markets Start Like This
Aug. 12, 2011
After a week of huge swings in global markets, WSJ’s Money & Investing editor, Francesco Guerrera, says “bear markets start just like this.” He expects eventful weeks ahead, with “markets not quite certain what to do.”
Bear market brewing? OMG! What to do?
Hey, it’s easy. Go to cash. Wait it out. Get back in when the P/Es drop below eight.
(How do you know the P/Es will drop below eight?)
I don’t, but they have done so so many times in the past that it appears that it is natural for them to do so. Buy when P/Es go below eight and when there is blood in the streets.
(How do you know there will be blood in the streets?)
Is this a trick question?
combo, was it you who said we’d see a coupla rallies in August, and then the downturn would set in for real?
If so, tend to agree, and that’s what we’re seeing now, IMO, the last of the rallies.
Squeeze that dish rag.
“combo, was it you that said we would see a coupla rallies in August, and then the downturn would set in for real?”
I might have, but I don’t remember. I think more in general terms - in trends - rather in specific terms - in timing of the trends.
But I will say this: IMO much of the market - and the economy - has been held up by FB-type thinking - thinking that this downturn is much like previous downturns have been in our lifetimes and will thus this downturn will be temporary and one should buy the dips. But after this dip-buying money is gone that will be the time the downturn will set in for real.
IMO this is not a temporary liquidity-based recession - something that can be fixed by lowering interest rates, instead this is a solvency-based depression - something that cannot be fixed by any one person or entity but something that has to run its course.
And because of this solvency issue - or rather insolvency issue - a lot of people who think they are going to receive money in the future are not going to be getting it. I say this because the money is just not there now and it will not be there then. Which means those who are owed money but do get this money are going to somehow have to do without.
And the only recourse an individual has left to him is to somehow make sure he is not a member of the vast multitudes who are promised but will not receive.
“…much of the market - and the economy - has been held up by FB-type thinking - thinking that this downturn is much like previous downturns have been in our lifetimes and will thus this downturn will be temporary and one should buy the dips. But after this dip-buying money is gone that will be the time the downturn will set in for real.”
Exactimento, amigo. Wall Street’s cargo cult has yet to lose their misplaced faith. In due time…
Was probably me. I’m just basing it on all the other stock crashes. September/October…
“Hey, it’s easy. Go to cash. Wait it out. Get back in when the P/Es drop below eight.”
Exactly. It’s a no-brainer. That’s why I am puzzled over why the ‘experts’ like Shiller are encouraging greater fools to ride falling knives all the way to the ground. Why not let Megabank, Inc choke on its own vomit?
Italian government approves new austerity cuts
By FRANCES D’EMILIO The Associated Press
ROME — Italy’s government approved €45.5 billion ($64.84 billion) Friday in emergency austerity measures over two years to balance the budget by 2013 in response to demands by the European Central Bank.
The Cabinet approved the package of cuts and new taxes despite fierce resistance from local government officials, who denounced the measures as socially unjust and as damaging to economic growth.
http://www.palmbeachpost.com/money/italian-government-approves-new-austerity-cuts-1731314.html - -
It’s important to recall that even after their “austerity cuts” that they still have better safety net than we do.
While looking over housing data I was struck at how many pic’s showed very little of the inside of the house. One this am had 13 pic’s and only 4 inside views. One even with 5 pic’s threw in a pic of their cat. Of course all of the properties are above $300K and when they do show an inside shot they look like they were furnished through WalMart some other particleboard chinese import distributor.
For Palmy: Ron Paul is opposed to NAFTA and all these other free trade agreements:
“free-trade agreements are really managed trade” and serve special interests and big business, not citizens. - Ron Paul
http://www.ronpaul.com/on-the-issues/free-trade/
Thanks, Bill. While I agree with him about NAFTA, CAFTA and other so-called free trade agreements, I have to confess that I am both a protectionist and a nationalist. The US, as it was, suited me just fine, for the most part.
Re: yesterday’s discussion of the USPS.
I recently had a long convo with a regional media director for the US Post Office, and was told that their pension fund is severely OVER-funded. Like 6.8 Billion, overfunded.
Because what is essentially a privately-operated franchise organization is forced to function under what he referred to as “archaic” Congressional mandate (established back when USPS was converted to a corporation in 1971,) the company is operating within financial parameters that are hugely out of line with its competitors.
Under this yoke, they cannot legally cut back services, restructure their pension plan, offer new product, or operate competitively without Congressional approval.
Consequently, they’re at a huge disadvantage and in spite of having significant surpluses, are operating in the red. The Post Office has not received direct taxpayer subsidies since the early 1980’s (other than for disabled and overseas voters,) yet they are regulated under direct Congressional control. One might imagine the good folks of Washington, D.C. salivating over the possibility of getting their hands on the cache, so keep this in mind as the story develops….
I recently had a long convo with a regional media director for the US Post Office, and was told that their pension fund is severely OVER-funded. Like 6.8 Billion, overfunded.
I can see the Kochtopus salivating at the prospect of raiding that pension fund.
How do Kochtopi siphon off other people’s pensions?
Say they Post Office is privatized, sold to the Koch Bros.for a song. Then they could raid the pension plan as it’s overfunded. Of course they would lay of 80% of the staff, reduce delivery to 3 days a week, and charge charge $2 to deliver a letter.
Also, without even having to buy the company, they can manipulate the investment funds that the pension is invested in.
That’s just 2 of the most obvious ways.
How are we doing at processing foreclosures and writing off the bad debt?
According to Fed Reserve Z1.
Total household mortgage debt 2002. $6T
Total household mortgage debt when house prices in 2Q2006. $9.7T
Total household mortgage debt when it peaked 1Q2008, 21 months after housing price peaked. $10.6T
Yeah added another $1T in mortgage debt in the 2 years AFTER the Case-Shiller index peaked.
Most recent Z1, 1Q2111. $9.97T
If we assume $6T was a reasonible base, and IF we assume falling only half-way from peak to that level, then we would need to write off $2.3T. We have written off .6T or 1/4th.
Is $6T is a real base? If we go back to say 1993 as a pre-funny money base, that that is $3T. Inflate for inflation to 4.7T then for 15% population increase = $5.4T. So, I guess, yeah, $6T may be a reasonible.
So, the question is, is “only halfway back to reasonible base” a reasonable amount of wrote off? Is 1/4th of the way to that level in 2.5 years a reasonible pace.
Well, despite having 2.5 million houses in “some stage of foreclosure” banks are only taking 1 million per year. The 1 million per year is just keeping up with how many new houses are entering the 2.5 million backlog.
And, despite having taken 3.5 million houses over the last 4 years, they have only sold off about 2/3rds of those with estimates of houses in their RIO protfolio about 1 million and growing.
Interesting law suit.
Law school says “90% of our grads are employed within a year after graduation”.
People applying to the school assume that means “jobs in the law industry”. In fact, the school was couting ALL jobs, even minimum wage jobs. Students graduate with $100K in student loan debt. Less than 10% are employeed in the law field a year after graduation.
The students unable to get jobs in the law industry sue saying they were deceived, are burdened with massive debts with little hope of repaying.
Law professionals say they have no case.
How long before congress gets preasured to lift the rules on not discharging student loan debt in bankruptcy, and have to nationalize atleast half of the $800B outstaning debt?
This is the Information Age, is it not? Information about most any subject is readily available to anyone with a keyboard, is it not?
If “yes”, and “yes” then one must agree that information about what sort of jobs attorneys get after graduation should also be readily available, yes?
If another “yes” is the answer then one has to question the mentality of those who spend tens of thousands of dollars to pay for an education to fill jobs in a field that, with a few keystokes on a keyboard, one could easily discover that very few job openings exist, yes?
“Information about most any subject is readily available to anyone with a keyboard, is it not?”
Actually, no.
There are companies who’s sole purpose is to erase all on-line records, references and news relating to their clients.
How do they do this? Find the source as well as the repositories and threaten to sue if the information is not removed.
It’s called “scrubbing.”
Now you know.
“It’s called ’scrubbing’.”
Yeah? Scrubbing huh. Well I just now typed into google the words “is law school worth it” and I immediately got back a message telling me that there were 18,900,000 results.
It looks as if the scrubers missed a few.
I was speaking in general.
But yes, they should have at least tried to do some research first.
We have a Software tester who passed the Bar.
“Less than 10% are employeed in the law field a year after graduation.”
My buddy, who works at Cravath, says that bombing the LSAT was the best thing that ever happened to me.
Why would he say that? Isn’t that the most prestigious, highest-paying firm in the country? Is he bumming out about the long hours that he works, or does he think that getting a job at Cravath is, in some ways, similar to winning a lottery?
Most likely the latter but you also have to be a partner to get that sweet equity every year.
“Why would he say that? Isn’t that the most prestigious, highest-paying firm in the country?”
Yes. He is a rockstar - always has been - which is why he knows I wouldn’t have made it. It’s a “he’s looking out for his best friend” thing. He works in the litigation dept. and is currently working on a Credit Suisse case.
But even he’s not a rockstar among rockstars, and knows he won’t make partner. At some point he’d wants to… wait for it… move back to Rochester, NY.
Law is an excellent Oil City career, actually. I guess they always need public defenders somewhere, or real estate or divorce or labor lawyers in even the smallest of cities.
Self-employed law if great if you really want to homestead, because you can work half-time on your own clock…
I just realized that I thought I WAS doing my own Oil City Plan by going into teaching. Whoops!
The company I work for has a fast track for college grads who are high achievers. This fast track is meant to elevate high achievers up the promotion ladder all the way to the Executive Suite.To get on this fast track one must be willing to pay the price, which boils down to not having a life other than what life that is not sucked dry by the relentless demands of the company.
Q. So, why would one want such a job?
A. Let’s go back to the original paragraph: “The company I work for has a fast track for college grads who are high achievers.”
The operating term here is “high achievers”. There is a selection process going on here; Those who are not high achievers need not apply.
But those who are high achievers do apply and they apply by the hundreds. Why? Because they are high achievers.
IMO there appears to be something wrong with these people in that there seems to be some sort of psychological imbalance that dwells within them, and it is this imbalance that drives them to pay whatever price needed to “succeed”.
And it is this imbalance that the company exploits to the max, as in churn ‘em and burn ‘em.
In they come one year, out they go a couple of years later.
It’s something that is very interesting to watch.
Combo, high corporate achievers….dot every i and cross every t.
A lot of us cant do this, because have good critical thinking skills, and we have to search for answers instead of memorizing them.
I really believe that is our problem today, all those very highly educated people and they are totally clueless to solve any problems.
“I really believe that is our problem today, all those very highly educated people and they are totally clueless to solve any problems.”
“Highly educated people” are those who can find out what position they need to take to please the instructor so they can earn a high grade. Not all of them, but a good many of them.
My daughter was a psych major. Her instructor once fed to her class the concept that animals do not have emotions, that all the emotions that humans appear to detect in animals are really the humans’ own emotions that are projected onto the animal.
My daughter said to the instructor “I can tell you never had a dog”.
I loved my daughter for saying this but, unfortunately, the instructor didn’t.
IMO the instructor is an idiot.
“But those who are high achievers do apply and they apply by the hundreds.”
They will do anything, but too many have no idea what they are doing. They make work much more difficult for those that do know what they are doing.
Realtors Are Liars®
This is what the Republicans have?
Watching the real estate swindler Perry announcing he is running for Pres.
Starts with a comment about “true conservaitive”, moves to “greatest fighting force in the world”. Then leads a prayer for the dead Seals in Afghanistan.
Pray to God and pass the ammunition. Really?
11 flags behind him.
Then after mention his time in the Air Force, says he is paraphrasing Lincoln an Reagan when he agrees that “United States is the last great hope of man kind”.
“We will not be told our place.”
“There is no money that wasn’t first earned by the sweat and labor of a hard working person.”
Umm.. I think he forgot something. First it was borrowed into existance by someone who wanted to spend more than their income.
He then goes on to bash Obama and how his policies have extended not cured our downturn.
Ummmm…. Becasue a good $10T, and probably more like $20T of our $38T in government, household and business needs to go away, and that means half that money that people worked so hard for, is going to just vanish into the thin air from which is was borrowed. And no one on either side of the political aisle wants to address that issue.
He then goes on to say that “debt is a burden to our country”.
Hello ass hat!!!!! That money that you love IS the debt that you are speaking against! Flip sides of the exact same coin.
This is our alternative to Obama the Wondering?
I notice they’ve been doing a lot of bragging about the “million jobs created” in Texas.
Created? Or transferred from California and the Industrial Midwest, to avoid taxes and/or to be closer to their suppliers in Mexico?
And what was the average pay of those “million new jobs?
I’ll bet it was low, low, low.
Meanwhile more Texans receive food stamps than Californians, even though there are 48% more people in California.
No Governor Perry, we don’t need your recipe for success.
What fraud. Running for president but his campaign is operating as if he’s running for local pastor.
If you want to see a shining example of the Teapublican vision for the US, go to the DFW Metroplex.
Slums alongside industrial parks, alongside million dollar gated communities. No zoning regs that I can see. Sprawl is the name of the game.
First class toll roads, but it costs $5.00 to drive from DFW airport to Plano. Crap “public” roads. I-35 going north out of Dallas is a giant CF.
I was training @ DFW a few years ago, when a tanker truck crashed and caught fire near Lewisville around 3pm. People were STILL stuck in the traffic jam at 11PM.
Lots (and I mean LOTS) of illegals. Lots of full size pickups and Suburbans/Tahoes. Lots of Southern Baptists…..who have more in common with the Taliban than differences, IMO.
Have had relatives in DFW since the 1940s. None of them are real happy with the way things are. At this point, the illegal problem is uncontrollable…….anyone who advocates for a real crackdown will have their head handed to them next election. Unfortunately, their crap overflows into all the neighboring states.
My impression of DFW is that it is one great big hell hole. It makes LA look good by comparison.
Yet it’s probably easy find sunburned, Tahoe-driving yahoos who can spend half an hour telling you what a great area it is. The population is growing rapidly, isn’t it? That’s gotta mean something. Everyone want to live there.
Also, check this out. Krugman has a graph comparing unemployment rates in TX, MA and NY. Keep this in mind if Perry starts bragging about the Texas economy.
http://krugman.blogs.nytimes.com/2011/08/13/a-short-course-in-miracles/
“And what was the average pay for those ‘million new jobs?”
“I’ll bet it was low, low, low.”
This is also my bet.
And with these low wages they are not going to have the money to bid up the prices for goods and services are they?
And if they do not have the money to pay at the prices that are asked then either the price has to drop or the sale will not be made.
If one has money then that means he has buying choices. If one has no money then he has no buying choices. It doesn’t matter what goods or services are priced at, if people do not have the money to pay for these goods and services then the price becomes irrelevant.
The deciding factor of a sale is not the just the price, the deciding factors includes money available to pay the price.
No need to bet. It’s a fact.
“This is what the Republicans have?”
Ron Paul.
http://www.youtube.com/watch?v=48Gfzgxh3ZQ
God help us.
Perry is the male version of Palin.
Just thinking.
My state has a program/deal where, for $20, you can send them your vehicle’s VIN, and they will send you a copy of all the documents they have on file for that car.
Sent them the VIN of my “weekend car”, and I got a copy of the original title and MCO from 1973, where it was traded in during the first gas crisis, sold a month later, sold again in 1980, sold again in 1989, then sold to me in 1991. Along with copies of the state inspection forms/stickers from 1974-on. With as many fakes/clones being built, this stuff is invaluable.
All this made me think…….Good thing the idjits haven’t come up with a MERS system for motor vehicles.
Interesting. Are the old records just from your state?
As the Republicans prepare to blame Obama for America’s economic woes on the way into a presidential election year, it’s great to have circumspect analysis from the likes of Nouriel Roubini to clarify how we got into this mess.
Roubini: Bush Responsible for Economic Woes 8/12/2011 3:01:26 PM
In a clip from his interview with WSJ’s Simon Constable, Dr. Nouriel Roubini insists that it was the policies of George W. Bush that caused the current U.S. economic crisis.
Actually, it’s the Repub polices of the last 30 years, beginning with de-regulation.
It wasn’t JUST Shrub.
Roubini blamed it on Shrub, but I agree with you. I knew we were in trouble back in 1980, when a fairly mediocre student in my high school class assured me that Ronald Reagan would be one of the greatest presidents our country ever had. Reagan commenced to saddle us with a debt burden from which we have never recovered.
“…a fairly mediocre student in my high school class…”
The shoeshine boy?
Bitter, priced-in home owners just don’t get it. Mortgage lending is not just about getting them the highest possible sale price for their used homes. A lender bears a fiduciary duty to its investors to protect them against the risk of losses in case they have to reclaim the collateral on defaulted mortgages.
Only government sponsored lenders can afford to lend at levels which put investor funds at risk, due to making mortgage loans which later go into default and generate REO that cannot be sold to recover the principle balance. The “investors” in this case are U.S. taxpayers with no say in the matter, who are unwittingly coerced into funding federal mortgage guarantees.
POLITICS
AUGUST 12, 2011
Judgment Call: Appraisals Weigh Down Housing Sales
BY S. MITRA KALITA AND CARRICK MOLLENKAMP
William Maxwell is an expert in finance. He’s a professor at Southern Methodist University’s business school, has co-authored a book on high-yield debt and spent years calculating values of financial markets.
Yet there’s one valuation he can’t understand: the appraisal of his Dallas home.
In August 2010, Mr. Maxwell’s home was appraised at $790,000 as part of a mortgage refinancing. Yet this past spring, when he tried to sell the four-bedroom home for $756,500, the appraisal commissioned by the buyer’s lender, Bank of America Corp., came up with a value of $730,000. Mr. Maxwell said the appraisal killed the sale.
…
Forgot to mention: This is a Wall Street Journal article which appeared on the front page of yesterday’s dead tree edition.
I love this blog:
First we are presented with some heavy credentials:
“William Maxwell is an expert in finance.” We learn he is a professor, an author, has spent years calculating values for financial markets.
And then we learn that he cannot understand the appraisal value of his Dallas home.
The appraised value of his home in August of 2010 dropped in value between then and when its value was again appraised last spring. But this William Maxwell guy apparantly cannot understand why that should be.
The Joe6Pack schmuck might be able to understand why (Maybe something to do with people not being able to get the money to buy? Maybe because prices have fallen?) but this Maxwell guy can’t.
As I said, I love this blog.
“It is hard for a man to understand something when his salary depends on his not understanding it.” - Upton Sinclair
“As I said, I love this blog.”
I don`t listen to country music, but I have heard this.
“I Love This Bar”
(Toby Keith/Scott Emerich)
We got winners,
We got losers,
Chain smokers and boozers,
We got yuppies,
We got bikers,
We got liberals and righties.
And nobody lost their house and beat their dog.
Mmmm, I love this blog.
We got Gulfstream fixers,
We got truckers,
Broken-hearted fools and suckers,
We got POBrds,
We got fighters,
Early birds and all-nighters,
And the veterans won`t let you fall off that log.
Mmmm, I love this blog.
Chorus
I love this blog.
It’s my kind of place.
Just login on puts a big smile on my face.
It ain’t too far.
No need to jog.
Mmmm, I love this blog.
I’ve seen short skirts,
We got high techs
Blue collar boys and rednecks.
We got lovers, Lotsa lookers,
I’ve read about Realtors that are hookers.
Someone once said that a Realtor stole a Hog.
Mmmm, I love this blog…Yes, I do.
Instrumental Interlude
I like my truck.
I like my girl friend.
I like to take her out to dinner.
I like a movie now and then.
But, I love this blog.
It’s my kind of place.
Just login on puts a big smile on my face.
No cover charge.
Never no fog.
Mmmm, I love this blog.
Mmmm, I love this old blog.
Lol. That is a riot!
Back in 2001 on video, Ron Paul gives a Congressional speech and predicts a real estate bubble.
http://www.youtube.com/watch?v=48Gfzgxh3ZQ
This is an amazing video. I just wish libertarians could realize how psychotic ending compulsory education is. There is no free market that delivers curriculum equitably.
Does anyone know why Stephen Colbert came out in favor of Rick Parry? Was it for religious reasons?
Colbert’s Super PAC launches first TV ad supporting ‘Rick Parry’
Published: 4:42 PM 08/10/2011 | Updated: 12:11 AM 08/11/2011
Funnyman Stephen Colbert has made good on his promise to up the ante with his very real “super” political action committee.
…
Homeowners feeling ‘trapped’ in struggling Florida housing market
By Dan Corcoran
WPTV.com
Posted: 2:21 p.m.
Saturday, Aug. 13, 2011
PALM BEACH COUNTY — Gloryann Torres misses her family in the northeast part of the country. She wants to move closer to them but the 65-year-old feels “trapped” in her Florida home.
“It’s like the jail is closing behind me. I’m just not happy here. I want to be away and there is no way I can afford to take this hit,” she said.
Torres paid off her $87,000 West Palm Beach condominium years ago. She feels that she would get less than half of that money back if she sold in today’s market. “That is the great irony. People who bought homes that they couldn’t afford are being helped out,” said Torres.
Housing experts said that there are likely many more people just like Torres in South Florida.
Paul Baltrun believes that Torres did everything right but that there is little help for her situation. He said any federal funding help is often for people having trouble with their mortgages.
http://www.palmbeachpost.com/money/real-estate/homeowners-feeling-trapped-in-struggling-florida-housing-market-1738398.html - -
In the same fish wrap on the same day….
From: Feds to be foreclosure landlords?
“And most Realtors argue the South Florida foreclosure market is hotter than happy hour at the Regal Beagle, with homes selling at or above list price.”
From: Homeowners feeling ‘trapped’ in struggling Florida housing market
PALM BEACH COUNTY — Gloryann Torres misses her family in the northeast part of the country. She wants to move closer to them but the 65-year-old feels “trapped” in her Florida home.
“It’s like the jail is closing behind me. I’m just not happy here. I want to be away and there is no way I can afford to take this hit,” she said.
Feds to be foreclosure landlords? U.S. seeks ideas; local real estate experts wary
By Kimberly Miller Palm Beach Post Staff Writer
Posted: 12:58 p.m. Saturday, Aug. 13, 2011
Federal mortgage giants Fannie Mae and Freddie Mac may become landlords to nearly 14,000 foreclosed Florida homes as the Obama administration seeks ways to deal with mounting bank repossessions.
A request for ideas this week from top housing officials focused on proposals that would increase private involvement in the housing market while supporting rental and affordable housing needs.
That includes one plan that would allow companies to invest in discounted foreclosures in bulk, rent them out, and share the proceeds with Uncle Sam.
But some Florida investors are wary of morphing Fannie and Freddie from mortgage backers to rent collectors, fearing a government version of the bumbling Ropers from Three’s Company.
And most Realtors argue the South Florida foreclosure market is hotter than happy hour at the Regal Beagle, with homes selling at or above list price. With that kind of demand to buy individual properties, they ask: Why turn to discounted bulk deals to churn out mass rentals?
‘The buyers are there’
Nationwide, Fannie, Freddie and the Federal Housing Administration owned about 250,000 homes at the end of June. Florida’s share of Fannie and Freddie homes is approximately 14,000. FHA numbers were not available Friday.
But as of mid-July, just 92,050 of those homes nationally were on the market for resale as many languish in the twilight between final foreclosure judgment and placement on the Multiple Listing Service or are considered under contract.
In Florida, 6,115 of the 14,000 have for-sale signs out.
“The buyers are there; there are so many buyers,” said Melissa Arno, general manager of Home Run Real Estate in Lake Worth, which handles sales for Freddie Mac and HUD. “Even properties with mold, it’s nonstop calling. The demand is so high
http://www.palmbeachpost.com/money/foreclosures/feds-to-be-foreclosure-landlords-u-s-seeks-1738154.html - -
Bachmann wins test straw poll. I guess we’re going to undershoot reversion to the mean in politics, too.
I want Palin to declare soon. Nothing better than a good cat fight -
Why not a Palin-Bachmann ticket — as I long ago predicted right here?
‘Mourning’ in America: What must be done about a depressed nation
August 10, 2011|By Ed Hornick, CNN
Jason Blatt of Knight Capital Americas LP reacts to the down market at the New York Stock Exchange on Monday, August 8.
As the Broadway musical “Anything Goes” says, “It’s always darkest just before they turn on the lights.”
Recent polls confirm that the country is desperately looking for those lights amid continuing economic malaise. But positive signs are hard to find.
The evidence: an unemployment rate over 9%, the S&P downgrade of the U.S. bond rating, troop deaths in Afghanistan, soaring government deficits, a ballooning national debt, the dollar getting pummeled overseas, yo-yo gas prices and gridlock in Washington that has stalled virtually everything.
America, it appears, is stuck.
“Since the White House and members of Congress could not get it together, the United States gets downgraded,” said Juneous Pettijohn, a CNN iReporter. “Let this serve as a lession! Let go of your EGOS and come together to get us out of this financial mess.”
It certainly doesn’t help the country’s psyche when some economists predict that the U.S. could face a double-dip recession. The Fed appears to have signaled surrender by telling banks it intends to keep interest rates near zero for the next two years.
And Wall Street reminds us every day that investors are anxious. On Monday, the Dow closed down more than 600 points. On Tuesday, it gained most of it back, up 430 points. On Wednesday, it fell more than 500 points at the closing bell.
“The Dow goes up; the Dow goes down. … It’s a self-fulfilling prophecy, really, and the more uptight we get, the more likely we are to not take risks — that’s being bearish, right?” asked iReporter WJ O’Reilly.
It’s hard to find a majority of American voices — besides those of President Obama and a few optimistic Republicans — who still think that our best days are ahead.
“I think the country is depressed. … The mood of the electorate is depressed,” said Jennifer Donahue, a political fellow at the Eisenhower Institute at Gettysburg College. “I think it is mourning in America when nothing will change the fact that Americans may be accepting that our fundamental way of living has changed — that the American lifestyle has change for the foreseeable future.”
…
This country is burried in debt.
We have been adding debt at 3x the sustainable rate for 30 years. The trade imbalances that created that debt, will prevent it from being paid back. When it isn’t payed back, it will default and be written off as uncollectable. The money goes away when the debt is written off, and people lose faith in money. Depression.
Unless we find a way to reverse the trade imbalances…
Which I don’t even hear anyone talking about.
So tell me mister, with this as our current situation, what lights are about to flip on? In think that is the power switch to the electic chair, not the lights.
A few anecdotes for folks who are wondering about level of business activity:
I had a friend over tonight that is an accountant at a major accounting firm. She said they are desperately trying to hire people for her practice area, but are having a hard time finding qualified candidates. During 2008/2009, they were shedding employees.
I spoke to an attorney friend, who is one of the partners at his firm. He is slammed with business. In 2008/2009, he had very little work.
We were speaking with a bank about a new loan for a piece of commercial real estate (very safe loan at about 50% of cost). We thought that the stock market gyrations might throw off the deal. We got word late last week that the loan was approved.
We were looking to sell a building…the prospective buyer held off signing the contract, noting the debt ceiling debate. The buyer just signed the contract last week, despite the market volatility.
Other than the stock market behaving crazy, from where I sit, it seems like business as usual…more muddle through. No stop in activity, but no strong activity either, roughly equivalent to what it was before the debt debate got into high gear.