Bits Bucket for February 21, 2012
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.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
April 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
“For boomers, it’s a new era of ‘work til you drop”
http://hosted.ap.org/dynamic/stories/U/US_AGING_AMERICA_CHANGING_WORKPLACE
The Kochtopus’s tentacles are everywhere…
Slate
Peter Thiel, the billionaire founder of PayPal… arrived at the Grand Hyatt in Washington, D.C. His audience: hundreds of young libertarians, most of them dressed as if they expected to be ambushed by job interviewers, overcrowding every inch of hotel carpet. They were trapped in America’s least libertarian city for the third annual Students for Liberty conference… Thiel, athletic and intense, moves quickly through the crowd, rarely recognized. He’s guided by Alexander McCobin, the president of Students for Liberty… McCobin had co-founded the group in 2007, when he was one of the dozens of Koch Summer Fellows (yes, that Koch) who live, intern, and network in D.C.
(Forgot to hit cancel reply.)
I’ve never a poor or below median income, libertarian.
I wonder why that is?
I have known a few, but they believed that all they needed was a “break” and they’d be independently wealthy. One, in particularly, was barely scraping by when I met him but constantly refered to other people as “drags on the system” or somesuch.
Delusional.
Delusional is an understatement.
How is it that someone so economically disadvantaged haven’t a clue how poor they are?
Truly a mystery.
Cognitive dissonance to avoid pain, that’s how.
Or as Darrel stated yesterday, Far too optimistic in the face of very negative facts.
Reality avoidance.
I’ve known some poor libertarians. Usually they work a couple jobs and know people who are on welfare, SSI, EBT etc and are really pissed off about it.
If you take worldwide income levels and compare them to US income levels, the statistic is that something like 60% of Americans are worldwide in the top 1% of income earners.
Seems like we should raise taxes on anyone making more than about $14,000 and redistribute that to the truly poor of the world.
we should
raise taxescut wages on anyone making more than about $14,000 and redistribute that to the mega-richtruly poorDavid KochSeems like we should raise taxes on anyone making more than about $14,000 and redistribute that to the truly poor of the world.
Why? We’re already sending them our jobs.
Aww come on.. the mega rich make more than 14k. I included them… Don’t insinuate I’m a class warfare zealot. If we want to talk about fairness, lets do it in the global scope… Americans overall are richer than everyone else. There is no reason for use to have a budget deficit. Just raise taxes on everyone making more than the global 99% until income exceeds expense, pay off the debt, then use the excess money to feed the poor.
Why should you complain about taxes if you are in the global top 1% of income earners?
But that’s work we are too lazy to do ourselves.
Brilliant batch of straw men, mathguy. Did your logic machine come up with those? If so, it needs a lot more work.
The anti-progressive taxation nonsensical arguments list:
# 27 Why should you complain about taxes if you are in the global top 1% of income earners?
#28 I never got a job from a poor man..
#29 Why do you hate the rich?
Why should you complain about taxes if you are in the global top 1% of income earners?
I wish no one ill will, but altruism only goes so far…
“If we want to talk about fairness, lets do it in the global scope…”
Once you select the streets of Calcutta to compare to, you’ve already diminished your credibility.
I’m not buying stuff at “World 99%er” prices. I’m competing against the 1%ers.
AK-47s sell for about $50 in Mogadishu. We’re trending in Mogadishu’s direction, but we’ll never be able to buy AKs for $40a piece.
All gun buying markets are local.
I don’t live in the rest of the world. I live here.
If you have to compare this country to a third world country in order to made it look good, you’ve actually just supported the point of our diminishing standard of living.
This is why I love this argument. It finally brings out clearly that the entire debate is one of moral relativism.
Obviously their exercise of libertarian values has made them immensely wealthy.
BFD about Koch. Now explain why Koch is a villain? Because you heard it over and over and are a monkey chanter?
I guess you missed the Wisconsin no bid sale, tax break power plant deal to the Koch brothers?
A deal where the resulting loss of tax revenue was DIRECTLY offset by state employee budget cuts.A deal done as direct result of Walker’s campaign funding by the Koch bothers.
The magic hand of the free market!
I missed it. However tax revenue and cuts in government spending are never wrong, from an Austrian economics point of view.
I think it’s pretty funny that the Koch brothers fund young people to “intern and network” in DC. Interning and networking are not what I would call “real” jobs, like being a mechanic or a lab technician or a drycleaner or even a romance writer, who produce things.
Isn’t “interning and networking” just the wealthy-person phrase for “community organizing?” And in DC no less, home of the government they want to be liberated from.
It’s in investment in people. They might get jobs on Capitol Hill.
“investment in people”
That’s also a wealthy-person phrase. The better terms are “buying off” or “we’ll help you out” or “after you’re sworn in, you’ll remember me, right?”
II lived in Wichita (HQ of Koch) for 20 years.
They do their best to screen their employees, looking for the Libertarian mind-set. They know that they can flog those guys to death, because they truly believe that “hard work” is the only thing between them and being a millionaire. Suckers.
Koch doesn’t care about Libertarian philosophy. They want “Small Government”. Because “small government” is less able to keep a lid on Koch’s stealing from Indian tribes, the US taxpayer, etc.
Koch is a villain?
Ayn Rand was sane?
Koch Brothers Flout Law Getting Richer With Secret Iran Sales
http://www.bloomberg.com/news/2011-10-02/koch-brothers-flout-law-getting-richer-with-secret-iran-sales.html
What many people don’t know is how the Kochs’ anti- regulation political ideology has influenced the way they conduct business.
A Bloomberg Markets investigation has found that Koch Industries — in addition to being involved in improper payments to win business in Africa, India and the Middle East — has sold millions of dollars of petrochemical equipment to Iran, a country the U.S. identifies as a sponsor of global terrorism.
The ‘Koch Method’
Internal company documents show that the company made those sales through foreign subsidiaries, thwarting a U.S. trade ban. Koch Industries units have also rigged prices with competitors, lied to regulators and repeatedly run afoul of environmental regulations, resulting in five criminal convictions since 1999 in the U.S. and Canada.
From 1999 through 2003, Koch Industries was assessed more than $400 million in fines, penalties and judgments. In December 1999, a civil jury found that Koch Industries had taken oil it didn’t pay for from federal land by mismeasuring the amount of crude it was extracting. Koch paid a $25 million settlement to the U.S.
….Phil Dubose, a Koch employee who testified against the company said he and his colleagues were shown by their managers how to steal and cheat — using techniques they called the Koch Method.
….“Everything Koch stood for was a lie.”
b-b-b-b-but the Koch brothers are Amurikin Patriots! Job creators!
In fact they are an example of how the ultra-wealthy see themselves as being above petty nationalism. I wouldn’t mind, if they weren’t so busy undermining things like public utilities and public schools right here in the USA.
Does anyone really believe that the people at NOVA would have loaded the last 5 minutes of a series of programs about human evolution with scientists quipping that our hominid ancestors dealt with previous episodes of rapid climate change and got through it (and may even have evolved to be a bit more clever because of it) so we should be fine with climate change too if one of the Koch brothers wasn’t one of their primary sponsors?
Eeeet Freedumb fries!
Now explain why Koch is a villain?
The Kochs just have a penchant for very quietly funding supposedly grass-roots organizations that present the wet dreams of billionaires as the demands of the little people.
I thinks it’s informative to point out their funding of such fake ‘voices of the people’.
And here we see them up to the same thing with the libertarians. If I were a liberatarian, I would want to know what’s going on behind the scenes, and which big boyz were quietly co-opting the movement.
But some prefer to keep their eyes shut.
Libertarians, yet drawn to a dominant authority figure….
“(yes, that Koch)”
Would that be the brother from another mother?
No, this one’s a mother*%# with another brother.
Actual LOL!
+1
Peter Thiel, the billionaire founder of PayPal
I hate to keep repeating myself, but we need to never forget that the Internet, the exciting development that America has been fascinated with continually for the last 15 years, was developed by the U.S. government in 1969. It was then maintained by the government for 25 years. Then, in the 1990s, it was effectively taken over by the business. This is known as corporate welfare and this Peter Thiel character owes his great fortune to it.
This is known as corporate welfare
I think that’s a stretch. Simply because the gov made the ‘net public and allowed individuals and corporations to profit from it doesn’t mean it’s corporate welfare.
I guess Ben’s the beneficiary of corporate welfare, then? And AZSlim? And any of the self-employed computer programmers creating iOS apps and selling them online?
I guess Ben’s the beneficiary of corporate welfare, then? And AZSlim? And any of the self-employed computer programmers creating iOS apps and selling them online?
I plead guilty as charged! I create websites for clients. I sell printed and eBooks online. And I do digital photography and sell downloads of images.
What’s my sentence?
Yes, all those you list are beneficiaries of corporate welfare, as are all of us enjoying and using the internet today.
Why would you not call it corporate welfare? There are people who post on this blog and refer to the Free $hit Army. Way back in the late 1940s, when computers were built from vacuum tubes and relays, the relevant corporations could have spend their own money on research and development. That would have been expensive, so they got the taxpayer to do it. The fruits of that R & D were then handed over for free to industry.
We have met the Free $h!t Army, and it it us.
“What’s my sentence?”
10 years hard labor OR 1 month with no HBB.
I guess both would be deemed cruel and unusual.
“What’s my sentence?”
10 years hard labor OR 1 month with no HBB.
I guess both would be deemed cruel and unusual.
Yeah, that would be cruel and unusual, all right. I don’t know how I could make it through a sans-HBB month.
I would guess 99.99% of us never asked for Internet to be “free” so go p up a rope.
I would guess 99.99% of us never asked for Internet to be “free” so go p up a rope.
You really mean to direct this at me, BiLA?
It’s not welfare when benefits go to taxpayers whether corporations or individuals. It’s the 50% who pay not federal income taxes that receive welfare.
Which would be great if those corporations actually paid their fair share of taxes, or created jobs for Americans as a way of “giving” back to the government which gave so much to them. But it’s pretty clear what corporations are after.
And the government gives a LOT to corporations. Free education for their workers through high school and loan guarantees through college, generous tax breaks for moving call centers overseas, military protection so that corps could obtain the oil that they need (while passing on the costs to customers anyway), rule of law so that they can run their business without paying protection money, Social Security and Medicare so that customers feel secure enough to spend money instead of hoarding it for retirment, high-risk research for drugs, and innovations in engineering, computers, and other proof-of-concept from university grants.
Show me a libertarian country where companies take all their own risks and buy their own innovation and protect all their own interests. Oh right, there isn’t one.
Oxy, you talk about people as if they were cattle. Fattened up by the government, they are “given” to corporations??? I rather think my public education was given to ME.
Oxide:
Would you consider my view that we should eliminate all corporate income taxes.
If you lose money then tough, uncle sam should not bail you, share holders or bond holders out…that’s what corporate elections are for…maybe we will finally get accountability back
Zombie Companies that have no value except for accumulated tax losses would become worthless overnight, and i doubt any of them have a lot of employees
I think taxing corporate profits are right up there with home mortgage deductions
I never got the idea of sending tax money to DC then they give you back a tax credit for next years taxes by accelerating the depreciation on buying new equipment..
I guess its all about the float
—————
Which would be great if those corporations actually paid their fair share of taxes
Working ’til you dropped worked for my father until he was in his mid-80s. Doesn’t work now — he’s too ill to work.
My mother, a retired public school teacher with a pension, is his primary caregiver.
I can’t wait for those who say the old are slackers become old themselves and ran head-on into the same attitude.
Or as I like to say, I love it when egos meet reality.
That’s my kind of poetic justice!
It’s not a matter of ego it’s fact. I am in my mid 50s. The younger people in the office can run rings ’round me. Happily my judgement is very good. And that’s my value.
work til you drop
Yes, that’s what happens when you spend and consume beyond your natural ability to earn. “Boomerica” needs to stop complaining about their expenses and start dropping that spending before they drop themselves.
The number of people in their 60s who are still paying on a mortgage, is shameful.
I sincerely hope this is satire…
I don’t think it’s satire. It’s shameful how many people who are in their 70s and 80s are hard off financially simply because they probably spent more time planning for a weekend vacation then their for financial lives.
A woman in my family, a widow in her 80s, commented that her husband worked for allthose things she needed. Now she doesn’t need those things. She needs him. Late realization.
Anytime the deluded insist the economy is in recovery I point to the poof money still in suspension.
It’s a sign of the times for South Florida real estate: The unfinished condo-hotel on Fort Lauderdale beach once linked to titan Donald Trump is scheduled to be sold March 14 at a foreclosure auction.
Developer SB Hotel never completed the 298-unit condo-hotel, stung by the 2008 financial crisis. Most condo buyers sued, seeking to recover their deposits.
he beachfront property at 551 N. Fort Lauderdale Beach Blvd. was first marketed as the Trump International Hotel & Tower, a $200 million venture that was supposed to bring cachet to Fort Lauderdale.
More than 100 people plunked down 20 percent deposits to buy condos in the 24-story tower, with studios and one- and two-bedroom units priced from about $500,000 to more than $3 million each.
The suits are taking years to resolve, partly because the group holding the loan on the property has changed. The bank that made the initial $139 million building loan, Corus Bank of Chicago, failed in 2009. Federal authorities sold some of its assets to a new group, led by Starwood Capital.
http://www.sun-sentinel.com/business/fl-condohotel-lauderdale-trump-20120220,0,2489382.story
Based strictly on hiring, I will say that in my area (and my area ONLY) the local economy seems to have hit bottom. (hiring is up)
How long this lasts remains to be seen.
Was just thinking this week that it feels like 2007 again. You gotta get into homes right after they list or there might already be a contract on them. I couldn’t get into a restaurant yesterday at lunch. They line was out the door. (Kids are off this week from school) There is a road I sometimes travel w/two million dollar(ish) estates for sale across the road from each other. Both are sporting SOLD signs this week. Both! One of my kids that knows me all too well laughed when I gasped at seeing the signs on both and said, “It’s Armageddon, Mom!”. We laughed but the sense of unreality that was here before the last contraction is back.
Around here, a lot of the 2007 in-VEST-or purchases are what’s now in the shadow inventory, or they’re back on the resale market as a REOs, foreclosures, or short sales.
Recovery has a meaning in economics that is different from what you think it means.
Good Morning. Here’s some good news, and I am hoping a trend. In my area (So Ca) I am seeing REO’s being released for sale in fairly good condition (and many redone) for $60K-$80K cheaper than the neighborhood comps. If the pattern continues, that ought to metigate the regular sale egos of putting a premium on their list price, because it’s not a short sale. The problem with the REOs so far, is that the locations are noise-centric. But I do like the pattern. I’m thinking that the REO Bulk Sales for rental conversions are coming in 2012, so the more of the REOs I see now, the better for us. I hear rumbles that we’re at 2003 prices, but I don’t see that yet. But the trend is our friend.
There are a few empty, defaulted shacks not shown on MLS that I would pay cash for in an instant if they listed them and priced them correctly.
Let them rot. Don’t care.
Interesting observation Awaiting. One model of the path of this market is that after we hit Peak REO, the next big leg down will let loose. If indeed we retraced from 2006 to 2003 in these six years from the peak, then we are retracing 1/2 year of the bubble for every year of the correction.
I suppose I should leave a note for my great grandchildren to buy a house in 2050.
Blue Skye
“retracing 1/2 year of the bubble for every year of the correction.”
I’m with you on that, and good observation yourself. Since we’ve turned down lots of homes, I track their escrow times. Many are lingering as pending way beyond a 30-60+ day close time. Could it be loans?
Disagreements on who pays for what repairs?
I would bet it’s a combo of both.
And our broker always tells us cash is plentiful out there, and we’re nothing special. And in reply, I imply he’s a liar.
“…after we hit Peak REO, the next big leg down will let loose.”
“After” a peak implies that there’s less than there was “at” the peak. So a declining supply will cause prices to fall? And fall faster?
Yes. After peak repossession comes peak dumping back on the market, which depresses prices again. That’s the theory. Can the Feds stop this? I don’t think so.
“Peak REO”
I interpreted that to mean the point when a peak level of homes are in the limbo stage between when they are taken back from their former owners and when they are put on the market. But that is just my interpretation; not sure if it is correct.
The large unknown factor is after peak REO, how many owners will put their homes on the market at the sign of any recovery. I suspect this number is significant. Look at how many were testing the waters in 09/10.
‘the REO Bulk Sales for rental conversions’
This is a strange idea that I have doubts about. Bulk sales are supposedly offered now by the GSEs, Wells Fargo, and probably others. Nobody bids; they are a mix of lots, 100 year old houses, etc, spread out all over the country. You’ve got 2 weeks to make an offer. No way to look at the properties, just go by appraisals. How could someone assess repair costs, carry costs and possible rents in a situation like that? I don’t see how you could come up with a number to offer, much less then price in a slim rental profit.
You might think, ‘it’ll be such a bargain price they’ll go for it.’ Why don’t they do that with the bulk sales now? Who knows what a bargain price is on a lot in BFE or an old abandoned house? And how do you tell someone what they can do with a property after they buy it?
I’ve done some work on properties that private groups have ended up with. They ask me to put for sale signs up for them, etc. Usually it’s junk. IMO, bulk sales are junk too, right now anyway.
Back in the RTC days, bulk sales were mostly sales of notes and then the buyer figured out what to do. One similar model today is Ocwen Financial. I don’t know if they make money, but they are buying a lot of paper. I believe they bought Litton and Saxon entirely.
Ben
You’re always good for an insider analysis and we all appreciate that.
I read that Oaktree Capital and Carrington Capital have cut the first deal on the Bulk REO package at $450M, with cents on the dollar prices. It’s just phase one, and they plan on renting them out. Maybe where we differ, is I am taking this first deal (which is to be one of many with different capital firms) as a major event, and maybe it isn’t. Rick Sharga (former VP of RealtyTrac is now with Carrington) says this is going to help the flood of REOs and thus control the collapse of prices. (You know, where they should be.)
IIRC the homes will have a rent to own theme (5 yr time frame) at great rental rates.
Any feedback?
I’m saying it’s strange how this is being presented. Bulk sales have been going on all along. The FDIC sells like this to anybody with the money. Ocwen, Condor Capital have bought large amounts of paper.
Here are a few problems with the rent thing. You can say cents on the dollar, but that doesn’t mean much with housing bubble valuations. I’ve helped foreclose on “houses” with $250k notes against them that are tear downs in terrible locations. Not worth 5-10 k. You can’t go by some number on a page when the appraisers were obviously committing fraud, the house has been sitting for 3 years, and passers by were helping themselves to the copper.
Another thing; if you are buying bulk REOs to sell, you aren’t obligated to put the property in any particular condition. You may make repairs that you think will bring a higher price, or maybe not. But if you are renting, you must bring the house into a habitable condition. That’s a much higher standard. So if you have $450 million, you better have a bunch more to get the houses up to snuff. How much? An extra 150 million? Maybe 250 million? Who knows?
I’m not saying these deals don’t occur, just saying I’m skeptical it’ll work. And as I said, I see private groups buying junk sight unseen all the time.
Ben,
Thanks for the feedback. Interesting points. You’re the man, when it comes to due diligence and rational thinking in the REO swamp.I get your points loud and clear. Thank You.
Just like so many of the short sales we’ve passed on. You’re not buying the property, you’re bailing some a-hole out of their financial quicksand. Short Sales are underneath our radar now. Same with REOs, although coming down in price, value vs. price are disconnected still.
Ask Cerberus how their “great deal” to buy Chrysler turned out.
Didn’t Daimler basically pay them to take Chrysler off their hands?
Cerberus paid 7.4b for Chrysler. Daimler assumed some RIF and pension costs. Cerberus lost their entire investment, however one can assume they wrote the losses off on their taxes.
Didn’t Daimler basically pay them to take Chrysler off their hands?
ISTR reading that.
And I’ll bet that Daimler is still regretting their decision to buy Chrysler. What a lemon.
Cerberus Said to Recoup 90% of Chrysler After Sale
By Cristina Alesci and Zachary R. Mider
December 21, 2010 11:33 PM EST
Cerberus Capital Management LP will recoup about 90 percent of its initial investment in Chrysler after the sale of the automaker’s former lending unit to Toronto-Dominion Bank, according to two people with knowledge of the transaction.
Cerberus will get about 75 cents on the dollar in cash when the sale of Chrysler Financial Corp. closes, said the people, asking not to be identified because the New York-based firm is private.
Including about $900 million of assets Cerberus is retaining as part of the deal, the company will be left with a loss of 10 percent on the initial investment in the automaker and its finance arm.
Cerberus Capital Management LP will recoup about 90 percent of its initial investment in Chrysler after the sale of the automaker’s former lending unit
This is what Cerberus was really after. Everyone knew the car company itself was worthless.
“…with cents on the dollar prices.”
The best way to deal with the kind of unresolved uncertainty Ben refers to above is to reduce your offer price by a discount to price in the risk the property is in worse condition than it seems after a quick look.
Buying ANYTHING sight unseen is insanity, but especially RE.
What if the price is, say, $0.01 on the $1.00? Would that be insanity? And if so, for whom: The buyer or the seller?
That is what aladinsane predicted! Also gold at $65,000. One out of two isn’t bad.
No CIBT, because you never know what the liabilities are.
Exactly even $1 might be too much if you start digging and its sitting on a meth houses’s toxic dump or has high levels of radon, or you dug up the next 30 of john gacy’s victims…and Heaven forbid you hired some Mehikans and they totally destroyed an old indan burial ground.
I have been dealing with foreclosures for more than 2 years now. My brother recently put a bid on a “short sale” that had been previously approved when the buyer backed out.
My experience has been thus:
INVESTORS (particular big groups) put in BUY bids on EVERYTHING. But they include a clause that they have 15 days to inspect and “back out”. I had been frustrated many times that the house had been sold, or bid higher than I would go, only to find that the “buyer” backed out.
The small house I bought in Pinellas County was awarded to me for LESS than I bid because the original “winner” walked away. I was allowed 24 hours to re-post my bid before it was put back into the MLS and back on the market, though it had technically been pulled, listed as sold, and awaiting the closing.
It’s not like the good ol’ days when you wrote a contract and did a final inspection for condition 24 hours before, or on the day of closing. There are lots of walk-aways, and the best part for the “investor”, they get to take their deposit back, too.
So, basically, the people who do this thing all the time, simply put up a $1000 deposit to hold the property off the market to give them time to inspect it before they decide whether the price was too high, or not. It makes for tough buying conditions for real homebuyers. Expect a lot of disappointments when trying to buy into this market.
I once bought a $1700 Jeep Grand Cherokee sight unseen from a Mormon Minister / Attorney. He was not very honest (attorney). But he felt bad and sent me a $200 refund later (Mormon).
from a Mormon Minister
IIRC, the LDS do not have “ministers” per se. All male LDS are supposed to become priests, IIRC. Also, the LDS take pride in that they don’t have “paid clergy”.
I think the Quorum of 12 are given jobs on the boards of LDS owned companies. Of course, these guys are seers and prophets, so what company wouldn’t want them on thier board.
Sen Smoot of Smoot-Hawaly Tariff fame was member of the Quorum of 12.
I kind of figured the guys at the top got a “stipend”.
“You might think, ‘it’ll be such a bargain price they’ll go for it.’ Why don’t they do that with the bulk sales now? Who knows what a bargain price is on a lot in BFE or an old abandoned house? And how do you tell someone what they can do with a property after they buy it?”
Everything is done to prevent price discovery. It is as simple as that. That is the most important reason for all of it, especially the restriction on use (rental, not resale).
“Everything is done to prevent price discovery. It is as simple as that. That is the most important reason for all of it, especially the restriction on use (rental, not resale).”
And that is the fact, the truth, the reality.
This is a technique that is prevalent throughout our entire society in every industry.
‘the restriction on use’
How do you put this in? A deed restriction? You would have to shave a lot more off to get me to buy something with a string like that attached.
‘Buying ANYTHING sight unseen is insanity’
There’s no other way to do bulk sales. There isn’t enough time for all potential bidders to visit each property. And the larger the deal, the less the bidder will know about what’s on the tape.
deed restrictions- An REO we put an offer in on (but rescinded on for other reasons) had a 6 month before you could sell it deed restriction.
You do it with a whole bunch of contractual restrictions. What about a contract that says the sale of even one property in the package within the time they are “restricted” is deemed to be a sale of all the properties in their package back to the entity that sold them for a $1 with additional penalty payments required. Give the entity that sells the properties a right of first refusal on any subsequent sales. Make up your own. The exact form will depend on local law, but there are always ways.
I agree that very few people are going to fall for it. The impact on the market will be small, as pretty much everything except the $8000 buyer’s credit and continuing low interest rates have been.
“The impact on the market will be small, as pretty much everything except the $8000 buyer’s credit and continuing low interest rates have been.”
Thx as always for sharing your insights.
There’s no other way to do bulk sales. There isn’t enough time for all potential bidders to visit each property. And the larger the deal, the less the bidder will know about what’s on the tape.”
Like I said, insanity. It’s the very definition of “stupid money”.
“Everything is done to prevent price discovery.”
Whatever became of glasnost at the Fed?
Federal Reserve Transparency Act
The Federal Reserve Transparency Act of 2009 (H.R. 1207) was a bill introduced in the U.S. House of Representatives of the 111th United States Congress by Congressman Ron Paul (TX-14). It proposed a reformed audit of the Federal Reserve System (the “Fed”) before the end of 2010. The bill had 319 cosponsors, and was referred to the Committee on Financial Services. Its Senate version, introduced by Senator Bernie Sanders (Ind.-VT), was called the Federal Reserve Sunshine Act of 2009 (S. 604), and it had 32 cosponsors. A related bill used the same two names in reverse order. An amendment with similar provisions was added to the Federal Stability Improvement Act (H.R. 3996) by the House Committee on Financial Services in November 2009. The bill was reintroduced in the House by Ron Paul, and in the Senate by his son Rand Paul, during the 112th United States Congress as H.R. 459 and S. 202. As of February 14th, 2012, the House bill has 204 cosponsors and the Senate bill has 19 cosponsors.
…
Ocwen Financial are bottom feeder scum. The squad had a temp gig working at their West Palm Beach headquarters in 2004. They are as bad (if not worse) than realtors.
I bought my $19k house from ocwen. They even ate the closing costs. How much could they have paid for that paper? (face value of over $160k + there was a $15k IRS lien that had to get taken care of).
Did you ever deal with their branch in India?
Ben
I smell a good story. Dish what you can. Thank you.
It’s no secret about their India operations. They decided to outsource much of the admin. stuff there, so if you are dealing with the property preservation/broker side, you often go through them. Problem is the English isn’t very good and I often end up more confused after speaking with them. So I try to never call and only use emails to resolve any issues.
No I did not have any interactions with Ocwen staff in India.
My job was to comb through electronic customer files (badly organized Word docs, Excel spreadsheets, and pdf files) to scrape together assorted fees into a catch-all account called “corporate reserve” that the borrower could be billed for.
Many of the pdf’s were personal correspondence from the borrowers, handwritten notes begging not to be foreclosed, et cetera. Their office had dirty carpet and stained ceiling tiles, the squad only worked that gig for six weeks before deciding the Florida experiment* was over.
*yet another benefit of being a renter (going nomad)
Ben, the only human voice I ever had contact withy regarding the deal was someone in India. There was no way to speak with anyone closer than that. Very little communication altogether- just an online-auction bidding process, then a couple of emails and a fax-based closing. Went pretty smoothly but did require serious faith on my part.
Liz, did you use the gohoming website?
“‘the REO Bulk Sales for rental conversions’
This is a strange idea that I have doubts about.”
As a long-term renter, I am somewhat reluctant to point out that mass conversions of REO into rental properties should serve to depress rents — i.e., to make rental housing more affordable.
But it makes sense, when you realize how long and hard our federal government has fought to make housing more affordable.
As a long-term renter, I am somewhat reluctant to point out that mass conversions of REO into rental properties should serve to depress rents — i.e., to make rental housing more affordable.
Shhh! Don’t say that so loudly. The rental house in-VEST-ors will hear you.
so far, rents are not dropping. Is any one seeing rents drop?
I’ve rented for over 18 years and not ONCE have I seen rents drop, unless I moved to a podunk town. I lived in the same place for seven bubble years, when people were leaving rentals to buy condos in droves. During that time, my rents were:
2000: $785
2001: $895
2002: $1000
2003: $1000
2004: $1000
2005: $1000
2006: $1200
2007: $1200
This was a one-bedroom including utilities, during bubble years when people were buying condos in droves. But my building could always find plenty of Section 8’s and/or multi-income households to keep up with the rent increases.
“so far, rents are not dropping. Is any one seeing rents drop?”
You’d think they would, what with all those powerful deflationary forces swarming around us.
Mine dropped 30%. I moved out of California to a nicer place with more acreage in Washington.
My tax bill also dropped almost 10%.
Oh come on Russ, you’re better than that.
A few blocks away is a house that was sporting an AZ REO, Inc. “for sale” sign for a good part of last year. Sign came down during the late fall.
I noticed that the big hole in the drywall that could be seen through the living room window was repaired. That must have happened over the Christmas holidays when I was away.
Nowadays, the house is just sitting there. Earlier this month, I saw a “vacant property” notice in the mailbox. The mailbox’s door was hanging open, and curious Slim rode up to it for a look-see.
Don’t know what’s up with the place. Apparently, it had mail delivery for a while. And whoever was getting the mail is now gone.
Realtors Are Liars®
Realtors are Lereahs.
Lereahs are God damned liars.
Well, you can’t really say they are liars if they are just too plain stupid to know anything about business and finance.
They’re more like train parrots: “real estate always goes up, real estate always goes up”…..”if you don’t buy now, you’ll be priced out forever”…….”NOW is the Best time to buy”…..”there’s never been a better time to buy,….uh,,,or sell”.
Really.
Give ‘em a break. You can tell they are stupid if you just talk to one. They have no clue about how the real world works, just that you NEED to BUY a House…..NOW. Before it’s too late!!!
A parroted lie, is still a lie.
Polly want a commission?
No offense to our own Sweet Polly.
Polly want a crack pipe?
Once again, no offense to our own Sweet Polly.
I was just talking to a co-worker about living just south of Harlem in the early 90’s. After dark there were crack dealers within a block or two of the Cathedral of St John the Unfinished. I was clever enough to avoid the area when the dealers came out. Plenty of studying to do anyway.
“They’re more like trained parrots”. Diogenes said
Ok, they’re trained parrots who are also liars, where the smarter ones live in a world of cognitive dissonance to protect their acting jobs and commission check.
Joe Public has no idea the script practice, role modeling and BS training UHS have.Always ask open ended questions, take the answer to reply for emotional pain and anchors, and then solve the problem. Always be in control of the buyer.
In the old days, not showing the buyer more than 3 homes per day,in a certain order, was the general rule.
Coming from Commercial, I didn’t like who those people are. I was a straight-shooter in a world of obfuscation and BS. I came from a REIT and into the belly of the beast.
Even when times are difficult, one must consider carefully what one agrees to do for pay.
Obama’s Housing Market Refi Program Won’t Work Because the FHA is Insolvent
Housing-Market / US Housing
Feb 17, 2012 - 06:25 AM
By: Money_Morning
Shah Gilani writes: In his State of the Union address last month, President Barack Obama outlined a plan to let homeowners, especially those underwater, refinance older mortgages to take advantage of today’s low rates.
While serious political impediments stand in the way of the Obama refi plan, one reason it won’t work is that it relies 100% on the Federal Housing Administration (FHA).
The problem is that the FHA is technically insolvent.
That “minor” issue could make the president’s plan a non-starter.
The FHA doesn’t originate mortgages. It is a government agency that insures 100% of the principal and interest on residential mortgages to the benefit of mortgage lenders.
The president’s plan is to have the FHA insure all “eligible” borrowers’ loans so lenders have a guarantee that refinanced mortgages will be paid back.
That incentivizes lenders to make loans they otherwise wouldn’t make.
Why the FHA is Insolvent
The FHA is technically insolvent because it is already below the minimum 2% “economic value,” or capital ratio it’s required to maintain by law.
In fact, according to an American Enterprise Institute “Outlook” report, the FHA has only $1.2 billion in “economic value” supporting over $1 trillion on loan guarantees.
In other words the FHA’s leverage ratio is close to 1,000 to 1 and its capital ratio is 0.12% — nowhere close to 2%.
For some perspective on how far the FHA has slid in reverse, in 2006 its capital ratio was 7.38%.
Things aren’t getting any better for the FHA either, they’re getting worse.
http://moneymorning.com/2012/02/17/one-reason-obamas-refi-program-wont-work-the-fha-is-insolvent/ - 76k
“it’s required to maintain by law”
If someone could explain that one phrase, I would understand the whole story much better.
FHA Mortgage Mag: February 8, 2012:
http://tinyurl.com/6w7j2k6)
————
“The latest statistics on the FHA loan portfolio show that almost 18% of all FHA insured mortgages are 30 days past due or more. The number of loans classified as seriously delinquent increased by 19% from last year…
The FHA insurance reserve fund which covers losses on mortgage loans has been almost completely wiped out. Although the law requires the FHA to maintain a capital ratio of 2%, the fund currently has a ratio of only 0.12%.”
————
In other words, FHA has to keep 2% cash on hand to cover defaults, but there were a lot more defaults than they thought. Well surprise surprise.
So, they are not required to have a 2% reserve?
I don’t know. Maybe loans are crashing and burning much faster than the frequency to officially calculate the capital reserve.
I’d be interested to know when these loans were originated.
I’d be interested to know when these loans were originated.
I’m sure these are the loans originated in the last three years.
That’s when the FHA became the most convenient rug under which to sweep the losses…
“I’m sure these are the loans originated in the last three years.”
How could that have happened?
First-Time Home Buyer Tax Credit: 6 Things to Know
February 17, 2009
While the proposed $15,000 home-buyer tax credit died in negotiations between the House and the Senate, the $787 billion stimulus bill that President Barack Obama signed into law Tuesday includes a similar–albeit smaller–measure designed to help revive the real estate market. Here are six things you need to know about the freshly-enacted $8,000 first-time home buyer tax credit.
1. Eight grand, new buyers: The tax credit included in the economic stimulus legislation is much narrower than the $15,000 proposal. This credit is equivalent to 10 percent of the purchase price of the home–although it’s capped at $8,000–and applies only to first-time home buyers and principal residences. But unlike an earlier $7,500 home buyer tax credit, this one does not have to be repaid.
2. First time buyers defined: For the purpose of this legislation, a “first-time home buyer” is someone who hasn’t owned a principal residence for three years before buying a house. (The date of purchase is considered the day that the title is transferred.) That means if you’ve owned a vacation home–but not a principal residence–within the past three years, you would still qualify for the credit.
3. 2009 buyers only: Only those who purchase a home on or after January 1 and before December 1, 2009 are eligible for the credit. Anyone who bought a home last year won’t be able to take advantage of it.
4. Income limits: The tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit, that’s $150,000 for married couples. Those earning more than these thresholds may be eligible for reduced credits.
5. Refundable: Because the tax credit is “refundable,” qualified buyers can take advantage of it even if they don’t have much tax liability.
6. Recapture: Buyers have to own the home for at least three years in order to capitalize on the credit. If they sell the home before then, they will have to return the credit to the government. (Exceptions will be made in certain cases, such as death or divorce.)
http://money.usnews.com/money/blogs/the-home-front/2009/02/17/first-time-home-buyer-tax-credit-6-things-to-know - 41k -
“…there were a lot more defaults than they thought.”
Nobody could have seen it coming!
“The problem is that the FHA is technically insolvent.”
That sounds quite analogous to a homeowner who is underwater on his mortgage. Is there a possible connection?
Doesn’t matter if his plan “works” or not.
The announcement that there was a “plan”, thus giving a new “fix” for the hopeium junkies was the primary purpose.
Sort of like the annual announcement at the start of the summer driving season that the government is looking into manipulation/price fixing in the gasoline market.
It’s not that anything is actually done, but it is perceived by the wretched refuse that something is being done, is the #1 goal of the plan.
Why should that make any difference.
All the banks are BANKRUPT, too. That has stopped them from doing business, as usual, with lots of fees and charges and the highest rates seen in decades for Borrowing on credit.
The FED makes the money and gives it to whoever they want to give it to, so there is always plenty of money to go around if you are in the right place.
Since it is now a “governmental agency”, they can never be insolvent.
You just haven’t figured out how the FED makes bad loans good.
PRINT MORE MONEY. There you go.
The FED is our “saviour”.
I meant to say hasn’t stopped the banksters from business as usual.
In fact, they’ve been on a buyout spree for the past couple of years, absorbing other banks, so as to have a true monopoly of all the loans in the world. YOU are now a SLAVE of the money-changers. A few key players can just play monopoly games with supposedly real money created by the FED, and printed up by supposedly “our” Treasury Department. Great big piles of paper.
“The FED makes the money and gives it to whoever they want to give it to, so there is always plenty of money to go around”
Time to print the money.
Kinda like….
Time to make the Donuts
http://www.youtube.com/watch?v=petqFm94osQ - 135k
I wonder if Bernanke has to get up as early to print the money as the Dunkin Donuts dude does to make the donuts?
Watch prices crater, then buy later for 70% less.
Here`s one for all you Deadbeats out there who got the bad news last week on the latest housing bailout. Current on your payments? Yes I know I was shocked too. Well anyway here`s a little what I like to call U-Haul music for ya. The link for the song is posted and I am sorry that I have not mastered the bouncing ball for all you Deadbeats to follow along with the lyrics.
Have a great day and enjoy your last few months of rent free living.
js
http://www.youtube.com/watch?v=VSCg3yXdYzk - 136k -
Robo`s goin-down doobie-doo-down-down.
Robo`s goin-down doobie-doo-down-down.
Robo`s goin-down doobie-doo-down-down.
Movin’ out is hard to do.
Don’t take my house,/(Do-do-do, down,)
(Doobie-doo-down-down.)/away from me.
(Robo`s goin-down),/Don’t you know I`m used/
(-Doobie-doo-down-down.)/to livin` free.
(Robo`s goin-down),/If I go then
(De-down, de-down.)/I’ll be blue.
‘Cause Movin’ out his hard to do.
Remember when /(Do-do-do, down,)
(Doobie-doo-down-down.)/you let me slide?
(Robo`s goin-down-),/Didn`t pay and/
/(-Doobie-doo-down-down.)/didn`t have to hide?
(Robo`s goin- down),/Think of all that we’ve
(De-down, de-down.)/been through.
And movin’ out is hard to do.
They say that movin’ out is hard to do.
Now I know, I know that it’s true.
Don’t say that this is the end.
Instead of payin’ rent,
I wish that I was livin’ free again.
I beg of you,/(Do-do-do, down,)
(Doobie-doo-down-down.)/don’t say goodbye.
(Robo`s goin-down-),/Can’t we give that HAMP
/(-Doobie-doo-down-down.)/another try?
(Robo`s goin-down,)/Come on, banker, let’s
(De-down, de-down)/start anew.
‘Cause movin’ out is hard to do.
(They say that payin’ rent is hard to do.)
Now I know, I know that it’s true.
(Don’t say that this is the end.)
Instead of payin’ rent,
I wish that I was livin’ free again.
I beg of you,/(Do-do-do, down,)
(Doobie-doo-down-down.)/don’t say goodbye.
(Robo`s goin-down-),/Can’t you give my house
/(-Doobie-doo-down-down.)/one more refi?
(Com-a, com-a, down,)/Come on, banker, let’s
(De-down, de-down)/start anew.
‘Cause movin’ out is hard to do.
Robo`s goin-down doobie-doo-down-down.
Robo`s goin-down doobie-doo-down-down.
Robo`s goin-down doobie-doo-down-down.
Fade.
http://market-ticker.org/akcs-www?post=202336
They’re still trying to spin this robo-signing agreement. The biggest casualty: the rule of law.
“They’re still trying to spin this robo-signing agreement.”
I thought I was the only one spinnin` the robo-signing agreement.
Never forget, a contract is only scared to those who hold the upper hand.
“sacred”
but but but….. “I was robo-signed! I deserve a free house!”
We haven’t had any rule of law since the FED and the Federal agencies allowed bankers to book losses as assets, held by the FED, until Bernanke can get some good inflation cooking and we can say they really are what the new money is worth. (actually since the FED was created in the middle of the night).
Frank-Dodd? really. How about Glass-steagle, instead? We are living in the midst of a world-wide swindle by Banksters, led globally by Goldman Suchs, who engineered the FAKE books for Greece and many other countries in the Eurozone so they could sell derivatives, world-wide, with the cooperation of Central Banksters and the World Bank/IMF, all of which are reaching into the pockets of Taxpayers and Citizens, while the rake off the trading fees and pocketing bonuses for boosting inflation, while front-running stocks.
There is NO rule of law, except that the only LAW is “banksters shall not be held accountable for their deeds, and must be allowed to pocket hundreds of billions of dollars for FINE LIVING at mansions around the world……….sipping champagne on their private jets, as they travel to Switzerland to do a little shopping and skiing, while the rest of the little people toil to keep up the payments on their loans. So, you see, we do have rule of law, but not by, of and for the PEOPLE, but by, for and of the FED and their buddies. An inside job. All cloaked in “secrecy” so that the average person really can believe that Bankster crooks somehow “earned” all the FREE paper.
We NEED a real President, and a Real Attorney General and a Real Change in the FED. GONE. Caplooee. Kaput. That will restore the ‘rule of law’. Oh, and imprison Bernanke, Paulson, and a bunch of their co-conspirators. That’s a job for the AG. And cut off Greenspan’s pension. I am sure he gets lots of money for mismanaging ours.
http://www.telegraph.co.uk/finance/dominique-strauss-kahn/9094886/Dominique-Strauss-Kahn-questioned-as-pimp-suspect.html
Someone tell me again why US taxpayers are forced to fund this organization (IMF).
Why were US taxpayers involved with removing him from the IMF?
http://www.washingtontimes.com/news/2012/feb/19/violent-crime-dc-surges-2012/
Violent crime in D.C. surges 40%, with armed robberies up 100%. How can this be? D.C. has the strictest gun-control laws in the nation.
In upstate South Carolina ,the Sheriff of Spartenburg County urges folks to buy guns to defend themselves with against the crims.That particular County has a good percentage of it’s people that sleep in the day-times and prowl around looking for places to rob at night . I’d feel much safer in a major city at night then there , at least the Sheriff is evening the chances of surviving a bit .
Well Jess, that sounds like some good ol’ common sense rule there.
Jess, are armed robberies up 100% in Spartanburg County? Would you feel safer in D.C.?
That particular County has a good percentage of it’s people that sleep in the day-times and prowl around looking for places to rob at night
Sounds like a preview of what we can come to expect nationwide, what with all those good lucky ducky jobs out there.
Ever notice the sort of folks that seem to congregate in and around goobermint centers in cities and such? Maybe it’s just Florida, but whenever I have to go to one of these places (rare, usually for jury duty or some such thing), I observe an unusual number of panhandlers, mentally ill, homeless, grifters of one sort or another, street preachers, etc.
Business owners will hustle them away, whereas the government centers are more likely to tolerate their presence due to that annoying Constitution thingie.
Hey wait! I though crime was DOWN?
It was Turkey until we got a president who hates Black people.
Care to elaborate?
You remind me of “Rex Kramer, part-time airline mechanic, full-time daredevil. A man willing to risk his life for the sake of adventure. He has to chase it, confront it, and whip it. Rex Kramer, Danger Seeker!”
Those who remember The Kentucky Fried Movie will know what I’m talking about.
You keep pussyfooting around with this tame racist cr@p under the “gotta teach English” jive, etc. Why don’t you just come out and say what you mean?
“The crime rate is increasing this year after a downward trend — the number of reported homicides last year dropped to the lowest level in a half-century.”
Maybe that’s the problem. As in NY, the 20-somethings moving in to DC are careless about their safety, and are providing an easy target, because the cities are safer.
My wife, noting the clueless way people act on the subway, said sometimes she feels like mugging them herself just to teach them a lesson.
Same thing happening here in Tucson.
Living near the University of Arizona as I do, I can attest to the fact that a lot of the crime is perpetrated against students. Specifically, residential burglaries and car busts.
They’re also less than vigilant when they’re out and about. Being glued to the mobile phones and the iPods doesn’t make them terribly alert. And the crooks know it.
I could make a living as a pickpocket of people drunk off thier buts in the 20-something bars in Dallas, but they only carry debit cards for tiny bank accounts nowa days.
Not much crime in Switerland where citizens are required by law to own guns.
Correlation != Causation
Are US taxpayers bailing out big banks again?
ByJill Schlesinger
February 17, 2012 7:32 AM
(MoneyWatch) U.S. taxpayers may be on the hook to bail out big banks — again. The Financial Times is reporting that taxpayers will subsidize a large portion of the $25 billion mortgage settlement, which was broken down into two distinct pieces:
A little refresher on the HAMP plan: Banks receive payments from the government when they negotiate with underwater homeowners to avoid default. The taxpayer reimbursement is used to help cover the banks’ costs to write down principal balances and keep homeowners in their homes. Last month, the Treasury department announced it was tripling the incentive payments to owners of mortgages who agree to reduce loan balances. The timing of the settlement is therefore perfect.
As the FT notes, “by reducing those balances under HAMP, investors — including the banks who agreed the settlement — now will receive cash payments of up to 63 cents on the dollar for every dollar of loan principal forgiven. They also will receive additional funds when borrowers keep current on their restructured mortgages.”
For the consummate treatise on the mortgage settlement, check out Yves Smith’s “12 Reasons Why You Should Hate the Mortgage Settlement” on her Naked Capitalism blog.
http://www.cbsnews.com/8301-505146_162-57380020/are-us-taxpayers-bailing-out-big-banks-again/ - 108k
“Are US taxpayers bailing out big banks again?”
Captain & Tennille: “Do That To Me One More Time” (1979) -
http://www.youtube.com/watch?v=X5h8Dm81Je0 - 149k -
IMF will supposedly be coughing up 23 billion Euro for the “Greek” (banker) bailout, even though the Republicans grandstanded and said they’d cut off that bailout funding.
We’ve been bailing out the FIRE sector for 20 years. Why stop now?
Fire consumes Fed fuel or it goes out.
“…that taxpayers will subsidize a large portion of the $25 billion mortgage settlement…”
Surprise, surprise…
I think one day I will get this through to you: BANKS are a money-skimming operation granted by government license to steal.
They will never be allowed to fail, so whatever they do, good or bad, you will pay for it.
It’s called CRONY Capitalism. Heads they win. Tails they win.
ALL loses go to the Citizens and Taxpayers via FED money counterfeiting (printing new money with no supporting assets).
KILL the FED and restore FREE enterprise.
Bad bets LOSE. Bye, bye, Bankster class. Impound their yachts and mansions. Do a claw-back on all the ‘bonuses’ for shuffling papers.
That will restore TRUST and faith in the American economy.
The zero percent interest rates, the failure to impost haircuts on Fannie and Freddie bondholers, the mortgages refinanced into the FHA, the regulatory forebearnce on extend and pretend.
The bailouts are massive and ongoing.
Some update on property movement here in Salinas:
1. Property in the $250K range going pending almost as soon as it appears on the market.
2. Property in the $500K range going pending almost as soon as it appears on the market in areas where people who love to buy labels want to relocate.
3. Went out to view a house (with young friends) listed at $245K (short sale)that had a two day open house. House fairly trashed by my standards. We were the third party to arrive on the first day of the open house. The other two parties were large hispanic families. While the others looked the RE ask my wife if we were investors? She said no, but do you have any offers yet?; he replied 10 before this open house. He is hoping to get the investor for a quick sale.
4. Went with the same couple to visit another house across town. It has been pending several times and is working its way down in price. It was bought about six months ago by some locals pooling money to buy houses to flip but you can’t flip to another investor in this price range and the asking price is above the appraisal price and therefore any hopeful FHA borrower’s are locked out because they don’t have cash to bring to the sale.
5. Many young underwater couples want to rent their house in order to move to a better neighborhood but find they have to get a renter installed before the bank will give them a mortgage on a new place. They were clueless when they bought their first house and they are clueless about being a landlord.
6. The investors are trying to get $2K or better in rents where most people can only afford $1200 unless they double up in family members. Most can barely afford the monthly payment let alone first, last and cleaning deposit.
The satellite pic of Salinas shows nothing but farm fields Does Salinas have the job base to support $250K houses? Or are they all driving 60 miles to San Jose?
I suppose that it could also be considered a “bedroom community” for nearby Monterey. Can’t afford a house in the Bay Area or along the coast? Have we got a deal for you!
I’ve spent some time in Salinas on business. There isn’t much there, economywise.
“The satellite pic of Salinas shows nothing but farm fields Does Salinas have the job base to support $250K houses? Or are they all driving 60 miles to San Jose?”
The answer is farming and tourism. Many people in Salinas commute to Monterey, Carmel, Seaside, San Jose and many in those areas commute to Salinas. I’ve been here 8 years and can’t figure out the total job situation. Lots of farm workers with low wages with the ability to buy “affordable housing”. Lots of people with money, big money! Most inherited. Housing has a bottom (don’t know what that will be) in this area (Salinas, Carmel, Monterey, Seaside,etc) because 99% has no current lots to build on and if you want to live here you have to pay the price and there are a lot of idiots wanting to out bid you.
Houses that sold at the peak for $450K to $750K are now in the $250K to $350K range. A lot of them around $120/sq.ft. or less on the low end and in great neighborhoods and better quality nearing $150K to $180K.
My rent has been $1635/mo. for approx. 1300 sq.ft. for the past 8 yrs.
Seems cheaper to buy at $1635 per month for rent.
because 99% has no current lots to build on and if you want to live here you have to pay the price and there are a lot of idiots wanting to out bid you.”
yep
It’s similar in DC. There is a lot of land in MD/VA, but you have to drive at least an hour to get to it. In the past 10 years, any undeveloped block has been developed for the usual “mixed use” live-here-work-here-shop-here complex.
And if you’ve been paying that for 8 years, watch out. You’re due for an increase.
“They were clueless when they bought their first house…”
That hasn’t improved if they want to now be underwater on two houses, which they will be the moment they close with essentially nothing down.
While the others looked the RE ask my wife if we were investors? She said no, but do you have any offers yet?; he replied 10 before this open house. He is hoping to get the investor for a quick sale.
Sounds like the “investors” are the designated suckers at this stage of the game.
Most offers will be from investors who will withdraw then later. And remember, REALTORS are liars. They want to stir up an urgency for you to buy.
I looked at another house not far from the one i bought. Just listed as an REO. Called the broker. Sign only. Not in MLS. Asked the price?
Told me 59K. I figured is as worth 45-50k based on age and condition.
I told him I thought that was too high and I wouldn’t be willing to go that high.
His reply: “we’ve already had an offer on it for that”. REally?
That was a couple of months ago.
Sign still on the property. Still empty.
What happened? I didn’t make any offers cause they’ve already been offered more than i would pay. Was he lying, or did they back out??
And remember, REALTORS are liars. They want to stir up an urgency for you to buy.
Stirring up urgency is a classic sales technique. Watch out for it.
I test drove a used car 1.5 months ago. I told the salesman we needed to do a comparison drive with a car across town the next day and we’d be back depending on the outcome of that drive. (The 2nd drive was BS, I just wanted out of there.)
He says to me, “Well let me know, because this car won’t last the weekend.” I said thanks and off we went.
It’s still on Craiglist, but the $9995 price has become $7995. And that might be a great price, but I’m no longer interested.
I’d go back just to frack with him.
2. Property in the $500K range going pending almost as soon as it appears on the market in areas where people who love to buy labels want to relocate. I’m having trouble getting my brain around $500K houses in Salinas. (And I have a house in that price range in Petaluma, which is arguably ridiculous.)
MSM has a bunch of recent articles describing the increases in apartment construction. The general consensus is that this is good for the housing market. It’s good for some poeple, i.e. the apartment owners, but once these complexes are built, they will start competing with the mom-n-pop speculator landlords for the same tenants. This will only collapse that segment further.
The story of “pent up demand” is just a myth. The trend I see in the future is more boomers moving in with their kids to take care of them.
There has been some activity building “nicer” apartments in my little burg, which command $1400/month payments, whis is odd as you can rent a house for less (you can buy a house for less, of course you’ll get stucco if you do).
Here in Tucson, there’s quite a push to build luxury apartment complexes for University of Arizona students.
Trouble is, there are only so many rich UA students who can afford these places. From what a friend tells me, these complexes are already cannibalizing each other for tenants.
Her son managed one of them up until a few weeks ago — the company was sold and that was the end of his job. She said that quite a few of his new tenants came from other luxury complexes nearby.
Actually Moman, you would be surprised at the amount of collusion that goes on to maintain a floor under rental rates.
I thought that would be a great idea for the 5bdrm McMansions…offer a big tax break if your extended family moves in…..but it wont pass zoning too many occupants or the HOA can’t park cars on the street or driveway, only in your 2 car garage
——–
The trend I see in the future is more boomers moving in with their kids to take care of them.
Future? Try now.
The “princess suite” will fast become “grandma’s room.”
$1.5 bn out of $25 bn in robo-signing settlement money is supposed to go to San Diego. In other terms, 6% of the settlement money ($1.5 bn/$25 bn = 6/100) went to a county which comprises 1% of the U.S. population (3 m / 300 m = 1/100) — not a bad deal for underwater San Diego homeowners who qualify for relief!
LENDERS SEND MIXED MESSAGES ON SETTLEMENT
Borrowers find accurate info is hard to get from five banks
Written by Lily Leung
12:01 a.m., Feb. 21, 2012
DEAL SENDS $1.5 BILLION TO S.D.
BIG BANKS NEAR PACT TO SETTLE ALLEGED ABUSES
BANKS’ MORTGAGE DEAL SAVES HOUSING AGENCY FROM BAILOUT
BofA settlement with Fannie, Freddie “clears air”
ANSWERS FOR BORROWERS ON SETTLEMENT WITH BANKS
Some San Diego borrowers are getting mixed and murky messages from their lenders on whether they qualify for benefits through a $25 billion mortgage settlement that may soon become official for 49 states.
A finalized deal — which promises principal reductions, refinances and restitution to about 466,000 Californians — may not impact homeowners until months down the road. But state Attorney General Kamala Harris early this month told homeowners “this is the time to reach out” to banks as well as community-based groups trained to assist troubled borrowers.
Harris’ office even compiled for Californians a list of phone numbers for the five mortgage lenders in the national agreement, which has yet to be approved by a judge.
What did some local borrowers learn when they contacted the banks?
In many cases, not a lot. And in one case, incorrect information. A couple of people were transferred multiple times by operators who were not aware of the deal, which is meant to help struggling and underwater homeowners whose loans are owned by Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial.
San Diego is expected to receive roughly $1.5 billion in the long-awaited settlement, which found the nation’s largest lenders engaged in robo-signing, an illegal practice of approving documents improperly.
Most of the borrowers who contacted the U-T San Diego about their experiences have loans with Bank of America, which is expected to pay the biggest share of the settlement at $11.8 billion. Bank of America could not immediately be reached for comment.
Other borrowers had complaints about Chase and Wells Fargo.
Jacki Betterton of Serra Mesa said a Bank of America representative recently took down her home-loan information after she inquired about the historic mortgage deal between states and the banks. She was told she’d get called back within two to three months.
“It was a very short conversation, ‘We don’t know anything else. The article came out prematurely,’ ” said Betterton, paraphrasing what the employee said about media coverage of the deal.
…
Maybe someday the ignorant/stupid general public will wake up to the fact that these “bailouts” don’t really apply to them.
The banks get the giant fudge cake up front, and j6pack/dumbazz ends up fighting the banks and other dumbazzes for crumbs.
Those who make less than $500 week already know, but what can they do about it?
That’s right, nothing… yet.
Have I mentioned the cities burning in the 1960s?
I guess we will learn what the new banking regulations are when Moses brings the sacred tablets down from the mountain.
BUSINESS
FEBRUARY 21, 2012
Fed Writes Sweeping Rules From Behind Closed Doors
BY VICTORIA MCGRANE AND JON HILSENRATH
The Federal Reserve has operated almost entirely behind closed doors as it rewrites the rule book governing the U.S. financial system, a stark contrast with its push for transparency in its interest-rate policies and emergency-lending programs.
While many Americans may not realize it, the Fed has taken on a much larger regulatory role than at any time in history. Since the Dodd-Frank financial overhaul became law in July 2010, the Fed has held 47 separate votes on financial regulations, and scores more are coming.
…
For some reason that reminded me of the scene where Moses (Mel Brooks) descends from Mt. Sinai:
“I give you the Fifteen -drop- -crash- the Ten commandments!”
Awesome image!
I should buy that DVD to add to the collection.
I, for one, would enjoy seeing banks evolve from gun slinging casino gambling operations into meagerly profitable service institutions whose operations are more dull and boring than dentistry. This would free up talented risk takers to apply their skills and creativity to make a positive contribution to society, without holding the scepter of too-big-to-fail systemic risk over the global financial system.
2/21/2012 @ 9:55AM
3 Ways Banks Will Be Killed by New Rules
The highly controversial “Volcker Rule” is back in the news since the period for public comment on the Securities and Exchange Commission’s proposal ended Feb. 13. It’s easy to see why banks are worried.
The rule, named after 84-year-old former Federal Reserve Chairman Paul Volcker, aims to sharply reduce risk-taking at banks by placing limits on so-called proprietary trading, as well as investing in hedge funds and private equity.
While the debate continues to rage, there are essentially three reasons bankers are sweating the new rule.
3. Banks will lose talented people
…
2. Volcker is another regulatory battleground in the banking war
…
1. Banks will be dull and unprofitable
…
3. Give us your tired, your talented,
Your huddled masses yearning to breathe free;
The wretched refuse of your teeming shore…..
Escape from NYCity?
Maybe some of those bright, talented young people who get sucked into the Wall Street vortex will now be free to move out to California, where they can enjoy some sun and fun while helping to revitalize our economy. The Volcker Rule is gonna be all good at the end of the day!
Talented people??
I think they greatly over estimate thier own self worth.
You would too if someone was paying you to be part of the 10% no matter WHAT you were doing.
I miss dull banks.
+1
I rather liked the idea of a bank returning a very dull but very certain 4-5% on a savings account or a CD.
No kidding.
So long as the stock market keeps going up, I don’t see why any of this should be concerning.
A Few Snags in Greece’s Bailout
Posted: February 21, 2012 at 6:34 am
Greece apparently has its 130 billion euro bailout, which should probably carry it through 2014. At least that is the intention. Private creditors have agreed to a 53.5% reduction in the value of their paper. Institutions that have had such cram-down terms will not be back as lenders. So, the officials of the European Union, European Central Bank and International Monetary Fund will have to hope that their financial package is enough, even if that hope is entirely unrealistic. It is worth a look at what may happen to Greece, and the eurozone, over the next few years — or even the next few months — now that the basic structure of the Greek deal is set.
The most likely set of circumstances, and one that few economist disagree with, is that Greece will need more than 130 billion euros before 2014. The austerity measures the government has set will not be adequate to offset a drop in gross domestic product, which is currently 6% — part of a recession that is five years old and shows no sign of ending. The need for new money will again test the will of France and, especially, Germany to provide capital. Sarkozy may have been thrown out of office by 2013. The same could be true of Angela Merkel. The people who have to make future aid recommendations may not be willing to do so.
The financial situations of Portugal and Spain could get much worse. That would increase the need for bailout money exponentially. The problem becomes even more difficult if the Italian economy stumbles badly. A “triple bailout” could cost as much as $1 trillion, many experts expect. The major rescue fund — the European Stability Mechanism — has not been set up entirely. It would have to join with the IMF and ECB to create a new rescue, and there is no evidence that the three would work together for a bailout that is seven or eight times the amount of the one for Greece.
If trouble grows in Europe, then the U.S., China and Japan may put more money into the region, probably through the IMF. Congress may not recommend any aid, if the drive toward austerity in the U.S. continues. Japan may contribute, but it has financial difficulties of its own. That leaves China, which says it will help Europe, but has not said at what level and for how long. If Europe has to depend on China for a bailout, it may have to wait for a very long time. Economists think China will act in its own interests because it needs Europe to consumer its exports. But the government of the People’s Republic could believe the cost is too steep.
…
So are the Greeks, especially the younger ones, with their EU passports in hand, going to start a mass exodus into the rest of Europe in order to flee the austerity programs?
I hope the dont flee to Portugal.
Surely they wouldn’t run out of one burning house and into another.
Where are they going to go? Unlike the United States, which until recently had almost exclusive use of ENGLISH as our national language, Europe is much different.
Do you think there are any opportunities for speakers of Greek in say, Germany or France? Netherlands? Belgium? Turkey?
Switzerland? Where, pray tell, do you think they will go?
Oh, yea, a boat to the US of A, where we can give them asylum status and pay for all their expenses. They might even be able to run the scam on the Germans. I think the British have had their fill.
Do you think there are any opportunities for speakers of Greek in say, Germany or France? Netherlands? Belgium? Turkey?
I did single out younger Greeks, who are more likely to be multilingual than their parents.
English is the national language of Europe too. Surely you knew that.
Oh, yea, a boat to the US of A, where we can give them asylum status
Where’d you get this idea?
We do it for everyone else. Why not Greeks?
The Greeks themselves don’t appear to be getting any “help”. It looks to me like a circular strengthening of the center (which is not in Greece).
The austerity measures the government has set will not be adequate to offset a drop in gross domestic product,
No relation huh?
Debt death spiral. An ounce of prevention is worth an Euro of cure.
If your favorite economic indicator collapses, the problem must be with the indicator, not the economy whose activity it measures.
The Commodity Investor: Tracking the Global Economy – The Baltic Dry
Tue, Feb 21, 2012
Post by Amine Bouchentouf, Resource Columnist
Columnist Amine Bouchentouf is a partner at Parador Capital LLC, an institutional advisory firm focused on commodities and emerging markets. He is the author of the bestselling Commodities For Dummies, published by Wiley. Amine is also the founder of Commodities Investors LLC, an advisory firm dedicated to providing insightful information on all things commodities.
The Baltic Dry Index (BDI) is an important gauge of the world’s economic activity. The BDI measures shipping rates for dry commodities such as iron, coal and grains across the globe. The index covers 26 of the major shipping routes used around the world, and is therefore a good indicator of global economic activity.
In theory, when BDI rates are high that usually signals strong shipping activity which usually means a strong economic situation. When rates are elevated, that means demand for ships to transport important commodities around the world is high. Up until the 2008-2009 period, the BDI did a wonderful job of measuring economic strength in the world’s economies. As economies grew the BDI accurately reflected this economic growth through increased maritime rates.
However, right after the 2008 economic crisis the BDI became a less reliable indicator of economic conditions globally. To be sure, the BDI dropped precipitously during the crisis reflecting the crippling economic conditions the world economy was facing. However, as the economy started recovering and global import and export activity picked up (especially in maritime trade), the BDI did not reflect this economic recovery.
The BDI closed at a level of 700 in February, down from 4600 levels in end of 2009. This drop of over 80 percent represents a dramatic move in a relatively short period of time. What’s even more puzzling is that this precipitous drop in the BDI does not correspond with economic realities, which actually saw a recovery with increased trade following the 2008 crisis. So, is the BDI an accurate measure of global economic growth and, more importantly, how can you use it to make sound investment decisions?
History of an index
The Baltic Dry Index traces its roots to 18th century London, where grain traders began recording shipping rates and aggregate them into a single database to make pricing of transporting goods across the seas easier to track. Today, the BDI measures a weighted average price of the four main types of dry bulk cargo vessels (Capesize, Panamax, Supramax and Handysize) in key shipping routes. As such the BDI is a good measure of the costs it takes to transport key commodities such as iron ore, coal and coffee beans.
In January 2012, the BDI started making headlines because prices collapsed, dropping about 60 percent for the month. This has driven many market commentators to question the reliability and relevance of the index. In order to understand this sudden price drop, it’s critical to examine the historical patterns of the index which will allow us to better appreciate its uses, and help us use it as an additional tool in our investment toolkit.
…
The BDI collapsed in 2008 because banks wouldn’t give letters of credit, right? That was not indicative of a lack of trade (willingness). It is collapsing now because of a bubble in steel hulls, right? Not indicative of actual trade levels dropping. Wouldn’t ocean tonnage moving be more interesting to us?
Wouldn’t ocean tonnage moving be more interesting to us?
+1. Exactly my thought, Blue Skye.
Why use a _pricing_ indicator as a poor substitute for a volume indicator, if the real volumes could just as easily be measured?
Volume = quantity — the horizontal axis scale on the Marshallian supply and demand graph that determines market prices. High supply of shipping capacity relative to relatively meager post-credit-bubble-collapse demand for shipments can reconcile extremely low shipping costs with a steady flow of shipments.
P.S. Thanks to the time-to-build effect in shipping capacity, the short-run supply curve is relatively steep in this case. What are you going to do with an unused container ship: Let it sit unused while the hull rusts away?
I’ve heard the saying “Waiting for your ship to come in”; I suppose in this case, it’s a matter of “Waiting for your cargo to come in”?
Note the article posted below is three years old; I’m sure the picture has drastically improved by now.
Cargo Ships Treading Water Off Singapore, Waiting for Work
Charles Pertwee for The New York Times
Sunrise in the Strait between Indonesia and Singapore, where 735 cargo ships were gathered Tuesday because of a sharp decline in global exports.
By KEITH BRADSHER
Published: May 12, 2009
SINGAPORE — To go out in a small boat along Singapore’s coast now is to feel like a mouse tiptoeing through an endless herd of slumbering elephants.
One of the largest fleets of ships ever gathered idles here just outside one of the world’s busiest ports, marooned by the receding tide of global trade. There may be tentative signs of economic recovery in spots around the globe, but few here.
Hundreds of cargo ships — some up to 300,000 tons, with many weighing more than the entire 130-ship Spanish Armada — seem to perch on top of the water rather than in it, their red rudders and bulbous noses, submerged when the vessels are loaded, sticking a dozen feet out of the water.
So many ships have congregated here — 735, according to AIS Live ship tracking service of Lloyd’s Register-Fairplay in Redhill, Britain — that shipping lines are becoming concerned about near misses and collisions in one of the world’s most congested waterways, the straits that separate Malaysia and Singapore from Indonesia.
The root of the problem lies in an unusually steep slump in global trade, confirmed by trade statistics announced on Tuesday.
China said that its exports nose-dived 22.6 percent in April from a year earlier, while the Philippines said that its exports in March were down 30.9 percent from a year earlier. The United States announced on Tuesday that its exports had declined 2.4 percent in March.
“The March 2009 trade data reiterates the current challenges in our global economy,” said Ron Kirk, the United States trade representative.
…
“What are you going to do with an unused container ship”
Recycle the steel, driving a stake into the steel supply/demand curve?
Blockade Iran?
Condo conversion?
Anyway, thinking about the supply/demand for what the ships carry, not for the ships themselves. International trade may be up, which is not a doom and gloom sign.
As I mentioned the other day, bomb it and get your insurer to reimburse. But first you have to get a war started with oh, say, Iran….
if the real volumes could just as easily be measured?
I suspect they can’t be easily measured, whereas prices can be.
You are partly correct. As the good times rolled in 2007 hundreds of super transports were being built which are now online and depressing prices. Trade stopped in 2008 due to a collapse in demand. The current index says nothing about the actual movement of trade, which at any rate slows down in the winter months.
Does anyone believe that massive capacity was added in the last 3-6 mo.
What is the lead time to building a ship?
How many ships were cancelled in 2008?
I doubt most shippers report how much they are shipping.
Assuming there is a “bubble” in ships since 2008. Were they able to get financing to build ships in 2008? I know that getting financing for aircraft got a lot tougher. And remains so.
And like houses, the banks are sitting on a bunch of older airplanes whose “book” value is a lot more than what they would sell for in the current market. You are seeing 10-15 year old airplanes being scrapped, that would have been repaired back in 2007. Cost of repair exceeds the hull value.
Like airplanes, ships require a firm commitment and prior order financing. So there weren’t large #s of cancellations. anyways buyers just assumed business would pick back up prior to delivery, which by my understanding largely has.
“…ships require a firm commitment and prior order financing…”
Macroeconomic jargon for this is ‘time to build’:
Time to Build and Aggregate Fluctuations
Finn E. Kydland, Edward C. Prescott
You are seeing 10-15 year old airplanes being scrapped
Older 737’s and 757’s I presume? Maybe some older Airbus models too?
How about 727’s? Does anyone still fly those anymore? I imagine that DC-9’s and older MD-80’s are also getting retired.
727s are still flown in Hawaii due to that state being excluded from noise regulations.
Nobody uses 727s anymore, unless they have to. They burn too much fuel.
Ditto DC-10s/MD-11s/passenger carrying 747s. The only 747s still flying passengers are the ones that have to fly over lots of water. (See “ETOPS”).
The airline world is a little different than the bizjet world. to those guys, fuel burn is everything. The 787 sales brochure says it burns 20% less fuel than a 767. If true, all the airlines will have to buy them, to stay in business.
Of course, these are all forcasts. Their mileage may vary. The airplane is heavier (empty weight) than predicted, so that will increase the fuel burn.
Boeing also assures us that they have all of the concerns about a composite/carbon fiber airframe addressed. Maybe. I guess we’ll find out.
I was mainly referring to the bizjet market. Prices on used aircraft are down 40% from 2007 values for the most part. The banks carry them on the books at 2007 prices, until they sell them.
My former employer paid $16.3 million for their airplane in 2007. The very same airplane sold for around $9 million in mid-2009. And it was a fairly new aircraft. Airplanes older than 10 years are seeing even bigger hits.
Bizjets, especially those at the upper end of the range (Gulfstreams/Challengers/Global Express/Falcon 900EX and 7X), aren’t as sensitive to fuel costs, as the airline guys and the bottom end of the bizjet market. Instead of flying a bunch of trips, they typically fly non-stop from USA to Europe/China/Middle East, then sit for a few days before they return. (For the 1%ers, the world is getting smaller all the time. It will get even smaller when the first SSBJ (supersonic business jet) gets built and delivered.
(Just doing my best to give people an intro on the problems involved…….)
(Just doing my best to give people an intro on the problems involved…….)
You did a great job, X-GSfixr. Thanks for your very informative post.
I gotta say, I’m luvvin the inside info.
“It is collapsing now because of a bubble in steel hulls, right?”
It’s only a bubble compared to relatively paltry demand for dry bulk shipments.
There is a similar problem in the U.S. housing market. If only bubble-era demand had continued growing towards the sky the way hope builders and their financiers anticipated, U.S. housing prices would not have collapsed.
Moral of the story: It takes both supply and demand to set equilibrium prices.
Here is another cargo index HARPEX. Not pretty.
http://www.harperpetersen.com/harpex/harpexRH.do?timePeriod=Years10&&dataType=Harpex&floatLeft=None&floatRight=None
Note that the general trend is downward after January 2005.
“Parador Capital LLC”
I read that as Predator Capital at first, lol. More cawfee!
Martin said yesterday:
“No one talks about the huge number of federal contractors and their massive hourly rate in hundreds of dollars an hour from the Govt. cheese. Firing Federal employees and hiring contractors to do the same job at bloated hourly rates is also the same bloated Govt.”
Say goodbye to some of that bloat..
WASHINGTON - Hanscom Air Force Base in Bedford, once considered immune to major budget cuts, is set to lose three-quarters of its funding for contract workers and is facing the loss of hundreds of government jobs, according to Air Force documents and officials.
The cost-cutting measures at the base’s Electronic Systems Center, set to take place over the next four years, will affect most of the 1,250 contractors now providing management, engineering, and other private-sector services. A separate change in Hanscom’s military status will mean the loss of nearly 380 government positions, according to internal briefings prepared in recent days by base leaders and shared with the Globe.
http://www.boston.com/news/local/massachusetts/articles/2012/02/21/hanscom_air_force_base_contractors_will_see_spending_slashed_over_4_years/
Comments from the article seem to support what many here have been saying.
“I worked for defense companies for 34 years. Trust me, they could all do with a 10-15 percent cut. Government procurement is still not fine-tuned. There are still thousands of contract-funded positions that can be eliminated.”
“While the jobs lost would be a major blow to workers and families, I won’t shed any tears for the small and medium-sized contractor houses taking a hit. I’ve never known them to provide any innovation, but rather just to skim a fat slice off government payments before they are passed out as wages.”
This should come as good news to anyone looking to buy on the North Shore… quite a few over-paid contractors will be looking to sell before the SHTF with regards to layoffs.
While employment in tech has been strong here, the shift from FEDGOV/MIC contractor to private employer/civilian contract rates will be quite the adjustment.
As an aside, I had to go to wedding on my wife’s side of the family last year. It was at the bride’s parents place in a suburb of DC. Huge house in a subdivision of luxury houses, enormous in-ground pool with over-the-top landscaping, etc. I asked what the bride’s father did: he ran an engineering firm that specialized in missle tech and was in heavy with the pentagon/defense dept. Lot’s of money to be made in war from what I gather…
DJIA = 13K or bust!
Feb. 21, 2012, 9:58 a.m. EST
U.S. stocks mildly off after Greece deal
Dow close to level not hit since May 19, 2008
By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) — U.S. stocks on Tuesday turned mostly lower, with the Dow Jones Industrial Average faltering ahead of 13,000 as investors questioned the durability of the latest fix for Greece.
The second round of aid for Greece “provides enough financing to avoid a disorderly default in the near term, but it’s unlikely the story is over,” Bill Stone, chief investment strategist at PNC Financial Services Group Inc., wrote in emailed research.
…
Buy stocks now, or get priced out forever!
Forget Dow 13,000; real story is Wilshire 5000
February 21, 2012, 12:06 PM
All eyes this morning have been focused on the psychologically important levels on the Dow Jones Industrial Average (13,000) and the NASDAQ Composite (3,000).
But that focus has diverted our attention from an even bigger story with far more investment significance: The huge 2007-2009 bear market is on the verge of being completely overcome.
Yes, you read that right.
Consider the Wilshire 5000 index, which reflects the combined value of all publicly-traded stocks in the U.S. Taking dividends into account, this benchmark is now just 1.7% below its all-time high set on Oct. 9, 2007. That means that just a day or two of strong market action would push the market into record high territory.
And that in turn means that an investor who was unlucky enough to have invested a lump sum in the stock market on Oct. 9, 2007, is on the verge of being made whole again — provided he invested in an index fund pegged to the overall market and he had the courage and discipline to stick with this investment through thick and thin.
…
In Alabama, a County That Fell Off the Financial Cliff
http://www.nytimes.com/2012/02/19/business/jefferson-county-ala-falls-off-the-bankruptcy-cliff.html?_r=1&scp=7&sq=alabama&st=Search
tease:
As residents of the county saw more officials go to prison, public opinion hardened against paying the debt.
“I don’t accept the legitimacy of this debt,” said Allyn Hudson, 32, an Occupy Birmingham organizer camping near the bankruptcy court. “It shouldn’t ever have been issued, and therefore it shouldn’t exist. It shouldn’t have been spent. Since it shouldn’t have existed, we’re not going to pay it.”
How it can be legit? General laws states that no contract is valid that was conceived in fraud.
Unless, of course, it’s the FIRE sector.
Dang! Am I not drinking enough coffee today?
“How it can be” *sheesh*
Oh, I understood you completely. Must be the new language filter obtained upon marrying my foreign born wife.
“Occupy Birmingham”
Birmingham is a long ways off from Wall Street.
P.S. I lived in a nearby community when I was 3 years old. I can remember to this day misunderstanding the name of the town to be “Burning Ham.”
Bill to streamline foreclosures clears key state Senate committee
By Kimberly Miller
Palm Beach Post Staff Writer
Posted: 5:19 p.m. Monday, Feb. 20, 2012
A quickie foreclosure bill that would require a homeowner to present a sound defense or face an immediate judgment in some cases moved closer to a full legislative hearing Monday with the blessing of the Senate Judiciary Committee.
Monday’s vote marked the farthest a proposal to streamline Florida’s strained foreclosure process has advanced in the Legislature since the housing collapse, but it’s in no way a done deal, lawmakers and lobbyists say.
Proposed language in Senate Bill 1890 would:
Reduce the time a lender can file for unpaid mortgage debt from a homeowner from five years to one year.
Restrict a homeowner to seeking only monetary damages if the home was taken fraudulently.
Allow any lienholder to request a quick foreclosure judgment, called a “show cause” order. Under the order a homeowner would have to present a meritorious defense as to why the home shouldn’t be taken or face an immediate judgment of foreclosure.
Florida forelcosures by the numbers (js bogus numbers, except the 24% but that`s only accurate because every other state`s numbers are low and bogus too js)
Days from initial foreclosure filing to bank repossession: 806 (more than two years) The national average is 348 days.
Number of backlogged court cases: 368,000 statewide.
Share of nationwide foreclosure cases: 24 percent.
Percent of state home loans in foreclosure: 14 percent, highest in the nation.
Sources: RealtyTrac, Florida Courts Administrator, Mortgage Bankers Association
(I am living in my second rental house with a combined 4+ years of missed mortgage payments SINCE 2007 and niether house ever showed up on RealtyTrac. I know of at least 10 empty houses right now and over a hundred since 2007 that were empty or had an LP filed without ever showing up on RealtyTrac or going to the courthouse for auction so what do these numbers mean? They are BS) SHADOW INVENTORY would block out the sun.
http://www.palmbeachpost.com/money/foreclosures/bill-to-streamline-foreclosures-clears-key-state-senate-2188489.html - 86k -
So after all the abuses by lenders in terms of fraudulent foreclosures, robosigning, etc., Florida state politicians are working to put the burden of proof on the homeowner to avoid a streamlined foreclosure process…
While I understand the logjam that is Florida distressed housing right now, this seems suspect. I would vote out any and all politicians who support this, and not because I feel deadbeats deserve the benefit of the doubt. Rather, lenders have shown how irresponsible they are and everything possible should be done to protect responsible homeowners from wrongful foreclosure and eviction.
The absolute best thing for these homeowners to do to protect themselves is to make the payments. Second thing, keep the cancelled checks and statements in a safe place. This is old technology, but it should still work.
What? A paper trail? You mean you can’t do this all from your iPhone? Isn’t there an app for that?
Yay! We can finally buy houses with clouded titles!
Why buy a house today when you can buy later for 65% less?
Last week was my annual ski-conference trip to Snowmass Village, CO. Aspen-area real estate is kind of hard to track, as the prices have always been astronomical. Still, most of the real estate offerings advertised ‘bargain’ prices. As in “reduced from 13,500,000 to 11,439,000″. Woo hoo! Aspen’s west end remains absurdly expensive for its stock of former miner’s cottages. They have all been extensively remodeled/expanded but are situated on very small lots. Why anyone would pay $3 million and up for one of them can only be due to the status of a West End address (Jack Nicholson has a home there, for example). And Aspen is all about status, natch.
Our shuttle van driver on the way out to Eagle County airport talked of hard times hitting the entire valley upon the 2008 crash, and few signs of recovery yet. He used to remodel homes and businesses but says that market has dried up. There is little building going on. The Snowmall Mall and ski slopes were uncrowded except on Friday, when the influx of Presidents’ Day weekend visitors perked things up. We didn’t mind the absence of lift lines and restaurant waits, but compared to the go-go years, the entire area felt strangely quiet.
Huffington Post is home to the most retarded, partisan driven clowns on the internet.
I find that the level of discourse in their comment section is well below what we have here.
You put it politely AZ. That’s not discourse there….. It’s group think like I’ve never observed before. They give the GOP respectability.
I thought Great Orange Sat@n were the partisans, but at least they are generally internally consistent.
Huff Post can’t seem to figure out what it wants.
CRE news from Tucson: Hotel bubble goes ker-flewie.
Spent the weekend around Palm Springs, no recession around there. I was afraid the local cops were going to pull me over/kick me out of the hotel for being a vagrant. Compared to their regulars, I am one.
The BMW and Benz dealerships on California 111 looks like the KIA dealership around here.
A buddy of mine was also in town, went over to Hemet to visit a friend of his, and have dinner. Worked on his buddy’s old KZ650, took it on a test ride. He didn’t come back for what seemed a long time, especially since it was cold, and he only had a t-shirt on. Figured if it broke, he would call, wondered if he had been in an accident. Compromised, and decided to go look for him if we heard a police car or ambulance.
Drank beer, played “Power Darts” after dinner. I quit when I decided that his hot water heater was in serious risk of being punctured, if I continued to play.
“…no recession around there.”
Nor here in Portland. 2 out of the 3 dinner spots we frequent have been “discovered” and had people standing in line waiting to get in. The 3rd one apparently has run its course and is no longer line-worthy before it opens, however, it was completely full by the time we left.
$500k+ houses flying off the shelves here too, and not in the rich enclaves. And here I sit for another year waiting for what I thought was inevitable 4 years ago…
Spent the weekend around Palm Springs, no recession around there.
Palm Springs is a winter destination for Northerners and Canadians, and it is slow in the middle of the hot summer.
The arrogance of Central Bankers, and sheep-like acquiescence of the public, is astounding. Like the Fed, the Central Bankers are printing and pumping liquidity into banking systems to spur reckless speculation, not productive lending, and forcing savers and pensioners to gamble in the rigged casino markets or see their savings decimated through inflation. When are the people going to wake up?
http://www.telegraph.co.uk/finance/personalfinance/pensions/9096514/Bank-of-England-deputy-Governor-Charlie-Bean-downplays-QE-effect-on-pensioners.html
Bank of England deputy Governor Charlie Bean downplays QE effect on pensioners
Pensioners have not been hit as hard as they claim by quantitative easing (QE) and should accept that they must bear the burden of the downturn alongside working households, according to the Bank of England’s deputy Governor Charlie Bean.
http://www.aljazeera.com/indepth/opinion/2012/02/20122218635894953.html
Why can’t we look to our own media for stories like this about the Troika policies designed to ensure the banksters get their money back by brutal “shock therapy” policies that inflict mass misery on entire nations?
http://www.independent.co.uk/news/world/europe/on-the-streets-of-athens-if-things-get-any-worse-i-wont-be-able-to-survive-7282729.html
Life in the Goldman Sachs colony that is Greece.
If you’re looking to pass some time while you wait for the bubble to collapse, check out the band “Fun.” You’ve probably heard “We Are Young,” but this guy has some other stunning, well-crafted songs. The lyrics are brilliant. Steve Miller + Freddie Mercury + Vaudeville. Or, a lighter Tom Waits.
Sort by popularity and listen away….
http://grooveshark.com/#!/search?q=fun