So Far Underwater, The Fish Have No Eyes
It’s Friday desk clearing time for this blogger. “Rex and Sarah Fritchey drove from Lehigh Acres to North Naples to take advantage of a free workshop. The Fritcheys, both 71, hope to modify their mortgage and save their home. The couple, who retired in 1986 from their landscaping business of 23 years, are struggling to afford their monthly payments. They were relying on income from other investment homes in Lehigh Acres to cover their bills, but that income has dropped drastically because rents have fallen so much with a real estate slump. One rental house that used to fetch them $1,200 a month now brings $850, Rex Fritchey said. ‘We refinanced the house and now we are upside down,’ Sarah Fritchey said. ‘It’s like you’re in a free fall. Someone has to stop and catch you.’”
“The vacant house next door has been gone more than a year, but Patricia Beck still has to deal with the consequences. The now-empty lot beside her home in Norfolk’s Lindenwood neighborhood has attracted drug users and vagrants, trash and trouble. Beck would like to buy the lot, but there’s a problem: No one will claim ownership. The company’s bankruptcy has dragged, leaving creditors unpaid and some investors with houses they don’t want.”
“‘We just want this done,’ said Karen Crowley, an attorney representing two brothers who at one point owned 48 properties in Hampton Roads through CM Development. Her clients have lost an amount approaching $1 million.”
“Two more lawsuits were filed electronically Wednesday in Pitkin County District Court from prospective buyers of Viceroy condo hotel units seeking to break their purchase contracts and get their deposits back. That brings the total number of such lawsuits filed since early October to 19 — representing roughly a quarter of the units that were put under contract mostly in early 2008 when the local real estate market was hot.”
“The picture has changed substantially for Base Village since then, when it was anticipated the entire 600-unit project would be done in 2011, and people were signing up daily to buy units — which would mean more people to pay into the infrastructure taxes and assessments levied on the project. The things making the base a tourist attraction and promised to hotel unit owners — an arrival center, plenty of retail and restaurants — were in the works then, but on hold now.”
“Asked if he was willing to negotiate should the developer approach him, the plaintiff answered, ‘I’m an avid believer in Snowmass as a great family and vacation spot, but the situation at the Viceroy that exists today is very different than what I bought into two years ago. I simply want out of the project. This is not merely a tactic to renegotiate a lower price.’”
“Fort Worth’s riverfront plan promises to create development on the Trinity that will double the size of downtown. Is that a good thing? And can Fort Worth pull it off? Former Republican County Chair Steve Hollaren, an accountant, points to high end condos near downtown that sit vacant and questions whether there’s a market for more on the water.”
“Steven: ‘The high-end condos have been overbuilt. You’re talking about putting properties in there that the average citizen is not going to be able to afford. A lot of developers that have high end projects - I’m talking about a half million to million dollar condos- in the city right now are having trouble moving them.’”
“House Financial Services Committee Chairman Rep. Barney Frank (D-MA) issued the following statement regarding recent press reports on FHA loan limits: ‘The reason Congress recently changed FHA (and GSE) practices to allow higher cost loans was to ensure that affordable mortgage credit was available to middle income families in areas with higher priced homes…Instead of representing a financial threat to FHA, allowing these higher priced loans allows for more geographical diversification for FHA. And, the just recently completed audit of FHA concluded that higher cost loans actually have a lower claims rate than lower cost loans.’”
“At a realtor tour meeting of the Silicon Valley Association of Realtors last week, California Association of Realtors Chief Economist Leslie Appleton-Young told realtors…(she) expects the jobs sector ‘will get worse before it starts to get better.’ She doesn’t see that happening unless new jobs are created.”
“On the plus side, sales are rebounding and it’s a bonanza right now for first-time homebuyers. However, Appleton-Young remains concerned about financing issues, including financial literacy. She wonders how the market will do ‘without (the) training wheels on the bike’ provided now by federal government programs such as the tax credit. She is also concerned about financial literacy, as 21 percent of this year’s homebuyers admitted in a survey they did not know or were not sure about the terms of their loan.”
“‘This is just unacceptable,’ she said.”
“Most years, the Charlotte Chamber’s economic forecast has offered a low-key, collegial atmosphere. Not so today, as Duke Energy CEO Jim Rogers offered a harsh assessment of the fledgling recovery and contradicted the rosier scenarios outlined by the president of the Richmond Federal Reserve and the top executives at Bank of America and Wells Fargo & Co.”
“Rogers described Wall Street and Washington as too narrow-minded to make the tough decisions required to cut deficits and lay the foundation for long-term growth. ‘What we have had an incredible duty to is put our head in the sand,’ Rogers said of the past few years in business and politics.”
“Despite being part of a panel that included major bankers, Rogers showed no heistancy to find fault. And Jeffery Lacker, the Richmond Fed president’s presence failed to dissuade him from making the assertion that the Fed and Washington politicians will only ‘print more money’ rather than enact more rigorous policies as circumstances demand. BofA’s Ken Lewis and Wells Fargo CEO John Stumpf and Lacker conceded some of Rogers’ points even as they defended their positions that the economy will make some strides in 2010. Failing that, they turned to gallows humor.”
“‘Remember The Gong Show?’ Lewis asked after Rogers closed his remarks. ‘If he starts that again next year, give him the hook.’”
“Sen. Bernie Sanders upped the ante on congressional Fed-bashing Wednesday, seeking to block Ben Bernanke’s nomination to a second term as chairman of the Federal Reserve Board mere hours before his confirmation hearing. ‘“The American people want a new direction on Wall Street and at the Fed,’ Sanders said. ‘They do not want as chairman someone who has been part of the problem and who has been responsible for many of the enormous difficulties that we are now experiencing. It’s time for a change at the Fed.’”
“The signatories make up a mind-bending group: on the right, conservative kingpin Grover Nordquist and Phyllis Schlafly; on the left, liberal economist Dean Baker. ‘This situation was totally preventable if [Bernanke’ just took the housing bubble seriously. I simply cannot understand how he thought the economy could withstand the collapse of an $8 trillion housing bubble without serious consequences,' Baker said in an e-mail, calling Bernanke second only to former Fed Chairman Alan Greenspan in terms of blame for the crisis. 'If a Fed chair doesn't get fired for bringing the economy to the edge of collapse and for leading it to double-digit unemployment, what do you have to do to get fired from this job?'"
"In recent months there have been a growing number of public notices of 'foreclosure sales' of homes in Buffalo published in the Buffalo Bulletin, but local bankers do not see the problem as being as serious as it was during the recession of the 1980s. Dean Bjerke, retired banker who was an officer with the Buffalo Federal Savings and Loan Association (now known as Bank of Buffalo), said the bank took ownership of more than 40 homes when the economy tanked in the early 1980s."
"'Sometimes we found the keys to a home in the night-deposit box along with a note that the owners just couldn’t make any more payments and were leaving town. We knew a ‘fire sale’ of these houses would have a devastating effect on the local real estate market, and bank directors and officers decided to simply rent most of them out until the market improved,' says Bjkerke."
"President of Buffalo Federal Savings and Loan at the time was Bill Perry, and Bjerke said Perry was adamant in his opposition to forcing an immediate sale of all of those homes. At the time they were getting pressure to market them immediately from bank regulators."
"The company held a meeting with local realtors, put all the properties in a hat and let them 'draw' for the rights (listings) to sell those homes as they could without placing prices under the current market values."
"This was done to avoid driving down property values in Buffalo and to reduce losses to Buffalo Federal Savings and Loan."
"There is nothing abnormal for corporate borrowers the world over to ask for rescheduling their debts, says a financial expert and economist from Saudi Arabia. Talking in the context of the state-owned Dubai World without naming it, Dr Mohamed Al Jebreen told The Peninsula late on Tuesday: 'Companies usually reschedule their debts.'"
"In remarks on the phone from Dubai where he was on a brief visit, Al Jebreeen said no lender ever gives corporate loans without adequate collateral. In the case of Dubai, the assets of the borrowing entity, which is presently in the throes of a controversy, should have pledged its assets (properties for whose development loans have been sought) as collateral with the lenders."
"'But the problem is that property prices are currently down almost 50 percent the world over, so they can’t be sold off to repay debts,' said Al Jebreen who holds a Ph D from a prestigious US university. 'I am sure that due to the slowdown in the real estate market globally the value of properties that are pledged as collateral with lenders are much less now than when the loans were taken.'"
"His argument implicit in the above statement is that Dubai’s debts can be rescheduled until the time the property market recovers so that it benefits both the borrowers and the lenders. Even in the US, especially Florida and California, property rates have declined by almost 50 percent in the aftermath of the world financial crisis. Some lending banks in the US are seizing properties which were pledged as collateral with them and selling these off at 50 percent lower rates to recover debts, he said."
"'So lenders in the case of Dubai can wait. The assets can be sold at a later date (when the market has improved). If these assets are sold right now, they (the lenders) aren’t really going to get anything, he said.'"
"Home, the aphorism tells us, is where the heart is. And when you own your home instead of merely renting it, your heart is supposed to swell with the pride of accomplishment. Purchasing a roof under which to rest your head is an essential part of the American Dream, we're told, a prerequisite to lasting happiness. But for others, the dream has turned into a nightmare. The housing boom, built largely on a shoddy foundation of unsustainable borrowing, has gone bust, leaving millions of Americans 'underwater'—meaning the money they owe on their mortgages exceeds the value of their homes."
"Statewide, foreclosures shot up 134 percent in October compared to the same period last year. And plenty of other Hawaii homeowners are clinging on by their fingernails. One of those people is former MauiTime graphic designer Kellee LaVars, who moved to the Mainland earlier this year. In 2003, she bought a condo in Kihei priced at $230,000. She says her lender sold her on a two-part, no-money-down adjustable rate loan and convinced her that 'the beauty of this loan was that as the property appreciated over the first two years we could [refinance] and roll both into a single loan with a fixed rate based on the equity we would accrue. He made it sound easy and logical.’”
“Shortly after she bought the condo, Kellee lost her job. She stayed on-island working as a freelancer, but then came word that the monthly payments on part of her loan were going to rise from $1,000 a month to almost double that. Kellee says it was ‘a huge shock,’ as she’d been assured her payments would never go that high. She went looking for refinance options, but found it nearly impossible to qualify since she was recently self-employed. A spiral of missed payments, paperwork and unfulfilled promises followed, and Kellee now jokes she’s ’so far underwater, the fish down here have no eyes.’”
“I ask her who she blames. She says she puts ‘a lot of it on the brokers who were willing to tell us anything to sell the loan,’ and characterizes them as ‘charlatans at best, liars at worst.’ At the same time, she accepts responsibility ‘for taking their word and not reading the loan [documents] thoroughly.’ Ultimately, she says, she was another victim of the failing economy: ‘It’s hard to pay a loan or get a new one when you’re underemployed or unemployed.’”
“Some will say it’s a matter of personal responsibility, that people who got in over their heads should have known better. There’s truth in that. But take a society that promotes home ownership as a noble goal laced with tax incentives, add aggressive lenders peddling too-good-to-be-true deals and mix in a dash of good, old American get-rich-quick fever and you’ve got a recipe for the crisis we’re currently facing.”
“In the end, making a major financial investment because it’s what you’re ’supposed’ to want or because some broker has put dollar signs in your eyes is irresponsible at best. Home may indeed be where the heart is. But sometimes it’s better to use your head.”
‘President of Buffalo Federal Savings and Loan at the time was Bill Perry, and Bjerke said Perry was adamant in his opposition to forcing an immediate sale of all of those homes. At the time they were getting pressure to market them immediately from bank regulators.’
‘The company held a meeting with local realtors, put all the properties in a hat and let them ‘draw’ for the rights (listings) to sell those homes as they could without placing prices under the current market values.’
‘This was done to avoid driving down property values in Buffalo and to reduce losses to Buffalo Federal Savings and Loan.’
I’ve found enough statements along these lines to convince me that there is something going on right now regarding the “shadow inventory” and lender-owned foreclosures. I suggest an initiative to counter this and expose it for what it is; illegal. It should be something like this:
To use public pressure and legal avenues to stop the collusion within the real estate industry, lenders and the government to manipulate the housing market to the detriment of consumers.
I invite any and all input in this endeavor, especially ideas on what legal actions we might take. A few things are clear; the government has no mandate to set housing prices. The agents and lenders are breaking the law if they are colluding to manipulate inventory. Let’s get to the bottom of this and if we find that this sort of thing is happening, we should do something about it.
Have you looked at the inventory picture in South Florida Ben? FAR is painting quite a pretty picture regarding inventory and sales. The fact is I’m on the ground in Palm Beach County. I see SO many vacant homes with no signs, no lock boxes, and no sense that anyone is trying to move them.
The bank filed foreclosure action on my home 6 months ago…since then there’s been nothing. Not one word. This is the same bank that tried to fleece us out of additional cash in a “modification” scam.
I go to houses just in foreclosure that have been vacant for 2 years or more. I’m thinking this is one way they are getting around some of the regulations; just let the house hang out there in limbo. If we can draw some media attention to this, I suspect it would shock the buying public and perhaps wake up some regulators (or maybe force them to crack down).
In markets where there are huge numbers of REOs, the collusion is more clear and I even find UHS openly discussing it with the press! This isn’t legal.
“…the collusion is more clear and I even find UHS openly discussing it with the press! This isn’t legal.”
Given the government’s lax financial regulatory regime, it does not seem very surprising that UHS are clueless that collusion to increase prices is illegal.
You are right about keeping the houses in limbo, and I’ve felt it for some time. It makes perfect sense for the banks to keep people in the homes even if they are not getting paid:
- Built-in security, the ‘owners’ keep it safe
- Upkeep by the occupier
- Skirt local ordinances
- No taxes to pay
- No negative publicity about too many vacant homes by a lender
The list could go on, but the banks are not ‘overwhelmed’ with foreclosures, they are trying to lose as little money as possible and will manipulate the inventory and owners to do it.
“…they are trying to lose as little money as possible and will manipulate the inventory and owners to do it.”
With a more competitive banking system (e.g. one not dominated by Megabank, Inc), this would not be possible.
I guess one place to start is by taking pictures of these neighborhoods at Christmas and note how many have lights up. Maybe annonymously make a small but obvious paint make on the driveway of every suspected vacant house. Something that, if it’s not vacant the owner would make an effort to remove, not something malicious or difficult to remove, just something that if the house is truly sitting empty will in fact just stay there for eternity because there’s no one there ever. Maybe a flourescent piece of light yarn across the front door or something that can be photographed throughout the seasons, that only HBBers would know what it means until eveidence is gathered. Could be placed there while pretending to drop a flyer in the mailbox or something.
I don’t think it will be that hard. Here in Flagstaff, there are realtors that have lists of REOs that aren’t on the MLS. Plus, it wouldn’t be that difficult to search NODs and trustee sales to find how many have been postponed, and for how long. If I tip off the local biz reporter as to how many are out there and have data to back it up, it should make the front page.
Then we ask the lender with the biggest number some hard questions.
Ben, you are so right. I have been watching literally dozens of houses around my area that have been vacant for over two years (FL) and still no foreclosure. I know firsthand of one that is not yet in foreclosure but is getting regular property preservation maintenance for the last year. What can we do to get the real story out there?
‘What can we do to get the real story out there?’
Gather the info, take it to the media, file suits and get depositions. If we are right about this, they already have their hand in the cookie jar and I guess they just don’t think anyone will do anything about it. FYI, I am open to suggestions.
Ben - can you make this idea an individual thread so we can discuss more over time? Thanks!
I’ll probably do this tomorrow.
Price fixing, in Flagstaff? Wow what a shock.
Comment by Ben Jones
2009-12-04 22:19:51
I’ll probably do this tomorrow.
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This would be great to have as a “sticky post” on the side or something. We need to get on this.
BTW, I think it’s fully endorsed (even mandated) by the govt, so not sure we’d get any support from that angle.
In So. Beach, they’re still saying $1200/sf for the high end condos. It’s nice, but that’s crazy.
I was under the impression that banks were legally compelled to not hold repossessed real estate, but instead to sell it as soon as possible. Is this not the case?
I’ve heard that the govt specifically told the banks to keep inventory off the market.
Even Barney Frank once mentioned something about “the policy of keeping homes off the market.”
“To use public pressure and legal avenues to stop the collusion within the real estate industry, lenders and the government to manipulate the housing market to the detriment of consumers.”
Thank you, Ben. I am glad to hear I am not the only one who believes the real estate industry’s anti-competitive conspiracy to prop up housing prices constitutes illegal collusion. They are also collectively shooting themselves in the foot, as higher housing prices in the face of a nasty recession results in fewer sales transactions.
Price Fixing
Price fixing is an agreement among competitors to raise, fix, or otherwise maintain the price at which their goods or services are sold. It is not necessary that the competitors agree to charge exactly the same price, or that every competitor in a given industry join the conspiracy. Price fixing can take many forms, and any agreement that restricts price competition violates the law. Other examples of price-fixing agreements include those to:
* Establish or adhere to price discounts.
* Hold prices firm.
* Eliminate or reduce discounts.
* Adopt a standard formula for computing prices.
* Maintain certain price differentials between different types, sizes, or quantities of products.
* Adhere to a minimum fee or price schedule.
* Fix credit terms.
I watch the MSM bank news and activities and occassionally post comments on Wisconsin local and inter-state banking activities.
The collusion between banks, holding companies, their chosen RE entities and other unspecified co-conspiritors in this game has always been a pet peeve of mine.
We do have a Wisconsin State Attorney somewhere but I believe that a Federal Mandate has his attention delegated to soccer mom speeders, suspected middle eastern looking terrorists in borrowed crop dusters and run of the mill mass murders instead of the white collar thugs and banksters.
Maybe I should just stop by his office in Madison and ask his secretary whats happening in the world of high finance RE fraud the next time that I’m over that way.
I’m sure that she would tell me eveything I wanted to know before she called for my meeting with the Capital Police Security SWAT Team.
Funny you should mention this idea, Ben. Matter of fact, it was hinted at in a reader comment that followed this Tucson news story:
Foreclosure filings fell in Nov. but remain at historic levels
Here’s the reader comment:
Josh please tell the real story
that over 3,000 additional foreclosures aren’t happening because banks just roll over the sale date and keep extending the foreclosure - ie moritorium difacto
and they are sitting on another 10,000 or more which they haven’t filed on yet
and according to realty trac they are seeing notices finally getting done after people have lived rent free sometimes for a year already
and another 1/3 of people who could run into financial difficulty are standing in line ready to default
so the story Josh is simple
2008 was bad 8,000
2009 is worse 11,000
2010 about the same or worse 12,000
2011 same as 2010
2012 same as 2011
2013 maybe we’ll see the light at the end of the tunnel
but by then prices will decline another 20-30%
You should see the number of postponements/cancellations of trustee sales in San Diego. I’ll bet the numbers are the same across the country.
BTW, I personally know of someone who hadn’t paid a single cent toward their mortgage, but didn’t even receive a NOD for over 6 months. I’ve also heard of the 1-2 year “free rent” squatters.
Doesn’t this run afoul of antitrust laws?
See my post above.
“So Far Underwater, The Fish Have No Eyes”?
That has to be the best book title ever for a book on the housing bubble!
Yes, and when you write that book I hope that you’ll give me proper acknowledgment for the title. Even better, let me do the book design and layout. I need the work!
Ben,
Tons of easy money given to the banks will ensure the capability to carry and hide home inventory for a long long time. It stings double knowing it is our tax dollars that is enabling banks to sit back and wait.
But even with this unfair collusion, inevitably the judge and jury hearing the case will see one of those dramatic US housing prices graphs that shows the steep dive in median price. These graphs will only get more dramatic as time passes considering we have another 3 or 4 years of declining, then drifting lower prices. What sort of momentum can you get with homes prices such a smoldering mess nationwide?
Ben,
I remember posting about this not too long ago…
-banks won’t foreclose since they don’t want to pay tax/upkeep
-owner rents the house to someone else, and doesn’t pay mortgage..may have several houses that he/she does this with…
meanwhile, normal people can’t buy at a fair price because banks can wait forever to sell/close/foreclose due to TARP, etc…(hence, “inventory” remains controlled).
BTW, 3 houses on my street that has about 30 newer houses on it used to have the white signs saying, repo’d, etc…now signs are gone, but still no activity…nothing about a sale on zillow either…one of them–the people just unassed in the middle of the night…
crush
BTW, that Dubai link from Qatar crashes my computer every time I open it.
Patience, grasshoppers. The hour approacheth. We are almost there. Enjoy New Year’s, because this puppy’s goin’ down afterwards.
http://www.oftwominds.com/blogaug06/post-bubble-symmetry.html
definately at phase 2 right about now.
Right. This graph has been my bible throughout the whole housing debacle. I am, so far, amazed at its accuracy, given all the gaming of the system and the bankster shadow inventory fraud.
If this graph continues to hold true, then the real drop is just around the corner.
When I first posted it on the blog, I wondered if the cycle might not be speeded up due to the internet and other factors, seeing as how it is based on past data. I thought we might see the long leg down a whole lot sooner. And I believe we would have, had it not been for all the artificial props like the tax credit, etc. So, what the props have accomplished is just to make the crash as slow as it would have been before the “false information age”.
Without government intervention it likely would have sped up. The homebuyers I deal with are all first timers. No one is trading up. When there is only one type of buyer that’s when you know something stinks.
The lack of move-up buyers is what’s been troubling me too. Seems like the current market has a lot of investor-types who are buying low-priced houses to rent out for a few years.
During those few years, through the magic of alchemy, their properties will appreciate. And this will happen, even while the tenants are beating the h-e-double-hockey-stick out of them. And then the investors will be able to sell for huge profits!
“And then the investors will be able to sell for huge profits!”
In the US, those days are gone for a very long time. A false system can only be gamed so far and I think we’re reaching the limits of it, if we haven’t already. I posted a Paul Craig Roberts article below, should show up soon. In it, he quotes Obama at the jobs summit as saying the gov is out of moolah and can’t handle the problem of lack of jobs, they shot their wad on wars and banksters and other malinvestments, so the private sector has to step up.
In it, he quotes Obama at the jobs summit as saying the gov is out of moolah and can’t handle the problem of lack of jobs, they shot their wad on wars and banksters and other malinvestments, so the private sector has to step up
And parts of the private sector already are. My little corner of it is quite busy, and I’m not the only one who’s experiencing such a thing.
I will take awhile before everybody realized that the appreciation fairy isn’t just playing coy; But is instead dead and buried.
And parts of the private sector already are. My little corner of it is quite busy, and I’m not the only one who’s experiencing such a thing.
——————-
I think you’re right. After the slow season last fall/winter, things have picked up.
Now, traffic seems worse than it ever was, and stores/restaurants are absolutely packed, even in the middle of the week.
“I thought we might see the long leg down a whole lot sooner. And I believe we would have, had it not been for all the artificial props like the tax credit, etc.”
Amen.
First time buyers & “investors” are the majority of buyers in most markets, I believe. They can only prop up this market for so long. Trade up buyer is DOA…who has the financial capacity or the will to add to their debt at this point?
Add to that with short sales & foreclosures, there’s only one purchase transaction instead of the normal two…the FB goes into a rental or moves in with family/friends instead of another property purchase.
“Add to that with short sales & foreclosures, there’s only one purchase transaction instead of the normal two”
Excellent observation.
I love this graph because describes the upside very well too. At each plateau, we ran out of buyers. Then lending standards were relaxed a little more, which scraped a new layer of buyers from the bottom of the barrel. As each safety net was removed, one at a time, there is a corresponding inflection point. 20% cash, to 10% cash to no % cash down, to I/O, to neg-am, to no-doc, to sub-prime, and finally to subprime + no-down + no-doc + neg-am + two-month teaser pay (i.e. strawberry pickers).
And on the way down, the safety nets are going to go back up one by one, same way they went down. Well, more accurately, government is removing its stimulus programs one by one. The private safety nets went up all at once. If government hadn’t intervened, the downside would look like the white cliffs of Dover. This downside looks like the gov is engineering a soft landing, and failing.
oxide,
What an excellent summation. When our grandkids paint us into a corner and just “want it straight” that’s about as close as we’ll be able to come.
Still, I resist the parallels Smith draws to the Nasdaq. If only for the very reasons you point out, the relaxation of credit standards. And if we’re going to ‘insist’ they interface without so much as a missing cog, then I would simply say, “then Etrade should have been v-e-r-i-f-y-i-n-g their client’s “financials” before granting them access to margin.
You forgot the biggest safety net of all - the Federal Reserve purchases of Mortgage Backed Securities this year. The FED bought approximately 90% of the loans made by banks for homes this year, more than 1 TRILLION dollars worth of these MBS.
Without the FED purchases, the interest rates would have had to have been higher to attract bidders (the banks don’t wanna tie up THEIR capital for 30 years).
If the interest on a 30 year mortgage was 6% - 8%, where would the housing market be today?
“If the interest on a 30 year mortgage was 6% - 8%, where would the housing market be today?”
The Fed is supposedly winding down their MBS purchases in March 2010, just in time for the Spring selling season. Not that they’ll actually do this, of course. More extend and pretend, just like carrying the buyer’s credit into next year.
Me, I’m waiting for 8% interest rates.
March 2010? I have a theory about this which I will post next week, but I think that may be a very interesting month.
If this graph continues to hold true, then the real drop is just around the corner.
The graph is great and represents the pattern of a typical bubble collapse.
However, I didn’t read where he addressed the possibility of massive government intervention to arrest phase two of the slide.
Can said intervention arrest phase two of the slide enough to greatly deviate from his projection?
Actually, I think the slide would have happened a lot faster, without all the government intervention. His model is based on past bubbles when communication and information was a whole lot slower in delivery. IMO, the only thing that government intervention has done is to cancel out the effects of faster communication and information delivery. As a result, the time frame looks much like past bubble eras.
Does the quip, “The markets can stay irrational longer than you can stay solvent” apply to the government? Can they keep pumping or is there a limit to which they will go?
I think we’re seeing the limit being approached right now. They’re out of material, seriously. When the prez has to go cap in hand to private business, begging for solutions to joblessness, the ballgame’s over.
The Federal gov, as a group, is out of its collective mind and out of bullets. We have no leadership, we have a rudderless ship.
Methinks that the government needs to get over its jobs obsession. There is work being done out there. It isn’t necessarily being done within the context of employment. BTW, I just wrote an article about this topic.
“The Federal gov, as a group, is out of its collective mind and out of bullets. We have no leadership, we have a rudderless ship.”
Finally something positive out of all of this.
Great article, Slim. Really very well done.
“The markets can stay irrational longer than you can stay solvent” apply to the government?
Proposed revision:
The government can distort the market longer than you can stay solvent.
Excellent, PB!
Professor Bear,
As with all humor..? The element of truth is that for each FB they’re keeping afloat, it’s (3) renters/potential buyers they are kicking under the bus.
How many posters have we had just here that have said they are now at a point where they really don’t care if they -ever- own a home? And I suppose by extension, how many have ’since’ lost their job/jobs and no longer qualify even if they wanted to?
No matter -how- much prices have collapsed in their respective areas?
Believing that the govt can distort the market for a long time, I just took a large long position in the corporate debt of Zions Bancorp. Oh yeah, Utah is going out of biz just like every other place; I’m just betting these a$$hat banks will continue to be able to borrow at zero percent and lend (to the Treasury) at three percent. Making themselves a “profit” with no risk. So why do they have to borrow from ME at an effective yield to maturity (2014) of 10.66% ? One of you bank-analyst can perhaps explain. Anyway, the stupid stock yields a lousy 3.5%, and is subordinate. Why does anyone want that?
“Can said intervention arrest phase two of the slide enough to greatly deviate from his projection”
i don’t think so…not without massive inflation…at some point.
Was wondering what is a safe investment to get into now considering that stocks may go down next year. Thanks in advice on any tips. All my portfolio (apart from a few in CD’s) is in (gasp!) stocks.
There’s no such thing as a safe investment. CD’s and other bank products are as close to a sure thing as possible. Next I’d say real estate purchased at 40% of today’s prices that can instantly generate some cash flow on the rental market. Today’s foreclosure victims are tomorrow’s renters…but it just doesn’t work if it’s not cheap enough. Rents are crashing along with everything else.
Was wondering what is a safe investment to get into now considering that stocks may go down next year.
Jack Daniels. You get an asset that will always be in demand and is highly liquid.
NYCBoy….HEE! I’ll drink to that. Feels safer than anything else right now.
see my comment just above about Zions Bancorp bonds, rated BBB minus.
someone i know bought a house six months for $ 410K. a practically identical house on the same street is now on the market for $ 370K.
they bought very soon after getting married. the nesting instinct is a pain to deal with. i struggled forever but now my wife is content renting…and we have an 11 week old son now.
meant to read ’six months ago’.
Michael…aren’t you relieved? Your holidays will be much more joyous with your heads ABOVE water, won’t they?
You can nest anyplace. Home is wherever I hang my crabby attitude.
“i struggled forever but now my wife is content renting…and we have an 11 week old son now.”
Don’t you mean she’s just too tired to even consider moving a household at this time?
Congratulations on your baby, Michael!
Rep. Barney Frank (D-MA) issued the following statement: “The reason Congress recently changed FHA (and GSE) practices to allow higher cost loans was to ensure that affordable mortgage credit was available to middle income families in areas with higher priced homes…
On what planet does he spend most of his time?
Uranus!
ROTFLMAO
I don’t think he’d be interested in me.
Are you a female?
probably one of the funniest things I’ve read on a blog.
District is southeastern MA. Bubble territory in a big way. Where is our Attleboro poster? Would be in his district or very close by.
Lets see, NFL Playoffs, the Super Bowl then the start of the SELLING SEASON !!
…Instead of representing a financial threat to FHA, allowing these higher priced loans allows for more geographical diversification for FHA. And, the just recently completed audit of FHA concluded that higher cost loans actually have a lower claims rate than lower cost loans.
I’m suspicious of this statement if only because the higher priced loans are so new. Were they only comparing them to lower priced loans of the same age, or all lower priced loans? Statements like this without the underlying methodology are essentially meaningless.
If I were going to predict the future of these potential FBs, I’d start by comparing their debt to income and loan types to those of past borrowers.
yet another example at why government should not be in the business of making business decisions.
they can’t help but polticize their decisions.
“He made it sound easy and logical”
I’ll assume she’s talking about an 80/20 ( and please to note, this was 2003! ) ‘Here’ is where I think so many of these FB’s collectively went down the wrong path?
Had they gone to their local regulators and said; “Hey, I have no idea if there’s been any laws broken here, but I got this home loan from “Broker X” and s/he said…?”
Instead, they took it upon themselves to find a remedy for their situation. What would the world look like today had people stood up much earlier and spoke w/ their congressman back in ‘03/’04 ?
See because, ‘that’ is what “I” do! Why when I’ve nearly OD’d on drugs, I don’t look to get in rehab and clean my life up? I just go find a different ‘dealer’!
Why weren’t any of the local regulators questioning the “churn rate” on these loans!?! Or did they think it was customary, standard and reasonable to re-set the clock every year to a ‘new’ 30 yr. loan?
“Had they gone to their local regulators and said; “Hey, I have no idea if there’s been any laws broken here, but I got this home loan from “Broker X” and s/he said…?”
…. or …. they did not want the local regulator to know that they were gaming the system and only after they realized they were not going to get rich (and more than likely much poorer)… then they were victims.
Dale,
Good point. These guys were more than a little slick. Partic…ularly when working w/ single applicants! Not a two-income family..? ( We can work around that )
As we’ve seen time and again, their deceptions knew no bounds. Still, ‘that’ is the regulators JOB! In reading a recent FDIC report on a failed local bank, I noticed they were issuing “Memorandum of Understanding” as early as 2003!
So these guys were given lip service that they’d clean up their act and… went right back to bus. as usual. So, this is when they should have rolled their sleeves up and dug deeper, not cowered and went back to their desk. Ever hear of escalation, guys?
Sarah Fritchey said. ‘It’s like you’re in a free fall. Someone has to stop and catch you.’”
There is that pervasive attitude, you make a mistake and then want someone else to pay for your problems. Hey lady, I really hate bailing your azz out.
wmbz,
What I found shocking was this mind you was from a couple in their 70’s. The Curtain of Real Estate Investments Gone Bad is so powerful it can blind even those whom you’d think still held personal responsibility on a pedestal?
It’s ‘just’ that strong!
I agree, “it” is that strong!
Stupid comes in all ages. And once some notion has lodged in your brain past 60, it’s hard to get it out.
I think this couple made two major mistakes:
1. Retiring at the age of 48.
2. Putting all of their financial eggs in one basket.
No one should retire at the age of 48, unless you have very deep pockets. Very deep pockets!
They retired in 1986. I wonder what they were thinking when Hurricane Andrew hit South Florida in the early ’90s destroying around 25,000 homes.
“Honey, something bad always happens to somebody else. We’re immune to bad karma. Let’s keep buying more homes.”
“We’re immune to bad karma” LOL!
Zachary, as that is the end of finance I deal w/ everyday, that lept out at me too. Another MSM gaffe that wasn’t called out.
You were.., ‘how’ young when you “retired”. No, they didn’t retire, they got into the RE/Flipping/LL biz and that’s really all there is to it!
Something ain’t right with this couple. I think mortgage rates were fairly high in 1986.
Mrs. Fritchey said, “It’s like you’re in a free fall. Someone has to stop and catch you.” What a crazy statement.
Like, they had 23-years for someone to stop and catch them.
On second thought, I guess they made another major mistake.
They should have cashed out when the median home price in Lehigh Acres was around $300,000.
They were in their late 60s then, and that age is a good age to retire. Not at 48.
Zachary,
This is just another story ( from a line of long sad ones ) where people enticed ( nay, intoxicated ) w/ the Wealth Effect felt not only comfortable but “entitled” to an early retirement.
Only to lament their decision shortly thereafter. Personally, I don’t mind a bit of healthy daydreaming about early retirement. But when you come across someone that conducts their affairs as ‘if’ it’s their one-and-only option, my advice is to steer clear.
It’s hardly UNtypical for them to do everything from stiffing waitresses out of their tips to throwing friends and relatives under the bus and a whole host of shortcuts. They’re obsessed, and nothing ‘you’ do is going to change them. IMHO.
“They should have cashed out [a few years ago]”
Exactly. I left wage slavery at 49 (about 48!) in the mid-90’s. I put almost all my eggs in the trailer-park mortgages basket. However, as we approached the period when TSHTF, I became very very VERY cautious and made only low-LTV loans. So far, so good. NOW i have less than 40% of my eggs in t.p.m. basket.
Anyway we gamblers have to be prepared to take lumps.
Single, double, or triple wide trailers?
Now I know who to go to for a loan.
After 23-years in the real estate business, this couple should have learned the ropes a little bit.
After the dot-com bust, more people should had been in tune to the many risks involved with speculative investing. I don’t understand how investors could assume prices would go up forever.
There were red flags across the country, and people still had dollar signs in their eyes.
They’ve had their retirement already. That’ smore than a lot ofpeople will ever have. No sympathy from me.
I agree.
Maybe they can hold their finances together and now buy a condo-hotel for their “real” retirement.
“Someone has to stop and catch you.”
This line stuck out on me as well. My reaction was that we can all let the ground do its job and stop that nasty fall for ya.
Well, unless you have rich parents. Big money always seems to cushion a nasty fall.
Friends in high places doesn’t hurt, either.
FW is very worried about the increasing delinquency rate amongst the downtown developments.
This development in downtown Fort Worth defaulted on their bank loan 3 months ago after having sold a grand total of 5 units in 2 years:
Le Bijou downtown housing project foreclosed on
By SANDRA BAKER
sbaker@star-telegram.com
Le Bijou, put on the market in 2007 during the push to bring much-wanted residential living to downtown Fort Worth, is now in the hands of the Fort Worth lender that financed the project.
OmniAmerican Bank foreclosed on the property Sept. 1 and the sale recorded with Tarrant County on Monday, according to deed records.
The bank loaned Le Bijou’s developer, Fort Worth architect Ken Schaumburg, $9.4 million in April 2006 to finance construction of the 14-unit project on downtown’s east side, between Sixth and Seventh and Jones and Grove streets.
When it hit the market, Le Bijou boasted the most units priced at more than $1 million and the largest units, between 3,000 square feet and 5,000 square feet. But only five of the townhouses sold between December 2007 and June, deed records show.
Recent deeply discounts weren’t enough to turn more sales. Prices on some townhouses were lowered to $680,000, according to Schaumburg Architect’s Web site.
“during the push to bring much-wanted residential living to downtown Fort Worth, ”
This crap went on just about everywhere, didn’t it? Yet the local proponents act as if they’re being oh so original and cutting-edge.
That’s been one of the recurring memes of Downtown Tucson redevelopment.(It’s been a governmental center for many decades. The PTB want more private commercial and residential development.)
However, here’s Slim, and I’ve come to rain on the parade. Here’s my first thunderclap:
Downtown Tucson’s northern boundary is the Union Pacific tracks. And, if you have railroads in your blood* the way I do, you take more than a passing interest in the freight trains going by. Especially the hazmat notices on so many of the cars.
Now, the downpour:
Imagine for a minute that one of those cars got a little out of kilter on the tracks. Or if there was a flaw in the way two sections of track were joined. We’re talking major derailment. Hazmat spill.
If such a thing were to happen in the wee hours of the morning, and that’s often the case, you can bet your sweet bippy that the Tucson city fathers will be thankful that so few people live Downtown.
Downtown Tucson’s northern boundary is the Union Pacific tracks. And, if you have railroads in your blood* the way I do, you take more than a passing interest in the freight trains going by. Especially the hazmat notices on so many of the cars.
The railroad and I-10 through Tucson are incredibly vital routes.
I lived in Tucson for 20 years and now I’ve lived in Vegas for five. I have seen maybe three moving trains here in Vegas in those five years, I saw that many a day in Tucson.
Just about anything coming from Asia and CA en-route to the Southwest, the South and the Southeast goes through Tucson.
The semi-truck traffic on I-10 is astounding.
Three trains a day is busy?
It is if you are a Danish prostitute.
Three trains a day is busy?
Those are the ones I actually saw or, worse, had to wait for.
I live/work a mile and three quarters north of those tracks. I can assure you that many more than three trains go by in the course of 24 hours. And quite a few go by in the wee hours of the morning.
My folks ranch was north east of Tucson and there was very little train traffic then, of
course, we all went swimming up in Sabino
canyon in those days. Tucson had less than
25,000 people and most of them were gangsters from Chicago hiding out from the law. Truth.
There are at least 10 other projects just completed or still underway just like the Le Bijou in downtown FW. Everyone is getting nervous.
The original announcement for Le Bijou was just as ludicrous:
GlobeSt.com Commercial Real Estate News and Property Resource
Last updated: July 12, 2006 07:47pm
$12M Townhouse Project Starts in CBD Heart
By Connie Gore
FORT WORTH-Closing out two years of project preparations, a local developer and architect has started construction on a one-block site at the edge of Sundance Square. The $12-million townhouse development is being sized up by investors and private buyers alike.
“It’s a great location,” Ken Schaumburg of Schaumburg Architects tells GlobeSt.com. “It will be the only townhouses you’ll find abutting Sundance Square. We got a good buy on the property a few years back so it’s made it viable to build.”
-snip-
Dana Seals, Schaumburg’s marketing director, says reservations have been placed by investors and private buyers. “We anticipate to be completely sold out before the completion,” she says. “We’ve sold out our other projects before completion and we don’t anticipate this will be any different. People really want to live here. It’s the only thing like it in the city.”
–>Dean Bjerke, retired banker who was an officer with the Buffalo Federal Savings and Loan Association (now known as Bank of Buffalo), said the bank took ownership of more than 40 homes when the economy tanked in the early 1980s.”<—
If Buffalo’s experience in the 1980’s is construed as the canary in the coal mine for other mid-sized cities, I can stay loudly enough, LOOK OUT.
And if you don’t understand, take a stroll through Buffalo, NY and you’ll know exactly what I mean. Buffalo is NY’s own Detroit.
My mother hails from Buffalo. She hasn’t been back there since I was a wee little Slim. I’ve been meaning to ask her why, but I suspect that it’s because she doesn’t want to see what’s become of her hometown.
Darn nice sports arena in Buffalo though. Corporate box seating is very enjoyable.
Knowing my mother the way I do, it would be a very cold day in Buffalo before she’d set foot in a sports arena. Especially in the corporate box seating.
OTOH, change the words “sports arena” to “symphony hall,” and you’d have to drag her outta the place.
Hee hee. I understand the sentiment.
Not that I’ve attended any symphonies in Buffalo but in the halls I have been in upstate it seemed the accoustics weren’t so hot. I’m used to Boston sympony locations with their older grander venues. I miss the rich depth of sound.
Quite frankly, I’m spoiled by the Kimmel Center in Philadelphia. (That’s where the Philadelphia Orchestra plays.)
‘If a Fed chair doesn’t get fired for bringing the economy to the edge of collapse and for leading it to double-digit unemployment, what do you have to do to get fired from this job?’
Armchair quarterbacking is easy. Fed chairmanship is hard.
I’m a bit surprised that the UE figures were not manipulated down to 9.9% so they could no longer refered to as double digit UE. That just has a nasty sound to it.
First rule of accounting, if you’re going to fudge the numbers make it count.
PB,
Thank you, and that’s all I’ve tried to share since the Credit Crunch began. Like having your river guide navigate you through class 4 rapids and then complaining because you got wet.
Still, it would have been time for him to go. It’s been my experience ( however ungrateful this may seem ) that once an interim-CEO has guided a co. thru a difficult transition, his entire approach is borne of a bunker mentality.
You’ve done a fine job Ben and we want you to take advantage of some well deserved time off!
Would your river guide have been the one that created the rapids in the first place?
NYCityBoy,
I hope you’ll pardon me (if) on so many occasions ( yourself ‘not’ included ) we bend over backwards and have short novel-length posts going into great detail as to why this is -not- B.O’s fault.., but then blissfully ignore AG’s entire tenure?
Unless of course we’re going off on AG as an entirely ’seperate’ topic, in which case, the gloves come off.
Fed transcripts have been released that make it clear BB’s role in the AG Fed was not one of restraint. We basically still have AG with a less wrinkly face. Bring back Volcker!
It’s very hard to pinpoint blame for a problem which was decades in the making.
Fed chairmanship is hard.
It would be damn near impossible for me since the first qualification is to sell your soul.
You also have to be able to lie nonstop with a straight face.
Looks like ol’ Bernie Sanders has mustered a diverse coalition:
“The signatories make up a mind-bending group: on the right, conservative kingpin Grover Nordquist and Phyllis Schlafly; on the left, liberal economist Dean Baker.
This is great news, real democracy in action when opposition groups join to defeat a common enemy.
Although it didn’t really work out too well when extreme left and right got together against NAFTA in the mid-nineties.
Although it didn’t really work out too well when extreme left and right got together against NAFTA in the mid-nineties.
Yes but back then it was mostly theories battling theories.
We now have evidence, proof and experience that NAFTA, outsourcing and the free-traders have gutted our manufacturing base, made the middle-class poorer and degraded our national sovereignty.
“America…more than just a market”
Don’t forget Jim DeMint (right-wing R senator), putting a hold on BB and demanding an up-or-down vote on the Audit the Fed thing.
I saw Bernie Sanders at a town hall in Vermont this summer. My aunt and I went together, and lemme tell you something, Sanders is beloved. I’ve never seen a Senator greeted that way anywhere. (McCain and Kyl wouldn’t get that kind of reception here, that’s for sure!)
I thought the hold was put on by Bernie Sanders, the socialist from VT. Strange bedfellows indeed.
As far as I’m concerned, Bernanke’s head should roll. But it’s highly doubtful if it will.
To me, Bernanke just doesn’t instill confidence. How can he rally the troops when his charisma quotient is zero? He talks in a monotone voice and he puts people to sleep. His job requires a bit of salesmanship, and that’s one of his many weak points.
Obama should remember that the unemployed masses are getting quite restless. And here’s a guy, Bernanke, being appointed for another term with questionable competency. Fire him! So what if he has hurt feelings. There’s 15 million unemployed folks that have a lot of hurt feelings, too.
I wonder how things are going with Mrs. Bernanke’s stolen purse. Her purse, with all of her credit cards, was stolen four or five months ago.
During the confirmation process, someone should have checked the status of the stolen purse, credit cards, etc., and see how Bernanke handled it. If this wasn’t handled in a professional, logical manner, how could Bernanke handle America’s finances?
0 substance + 0 style = Bernanke
“The subprime crisis is contained.”
If he knew he was lying then shame on him. If he wasn’t lying then shame on him. Any organization whose first job is to lie to us should be disbanded or overhauled until lying is no longer their top priority.
I agree.
Mr. Obama, fire the guy. Any link to George W. Bush is a bad omen.
Paul Craig Roberts. The entire article is worth a read:
“The additional $30 billion for the war comes on top of the $65 billion already appropriated for the year. These appropriations are always fattened with supplementary appropriations. The true cost is well in excess of $100,000,000,000.
Who’s going to pay for it? Democratic Representative David Obey, chairman of the House Appropriations Committee proposes to raise income taxes on everyone earning more than $30,000.
This is called “trickle-up” economics. You tax the little guy and give the money to the armaments companies.
There was a time when Democratic presidents represented the little man, and Republicans represented business. Today both parties represent the moneyed interests. On December 3 at the jobs summit with business leaders, Obama said, “We don’t have enough public dollars to fill the hole of private dollars that was created as a consequence of the crisis.”
In other words, all the public’s money has been spent on the banks and the wars.
Despite Democratic majorities in the House and Senate and the ease with which Obama won the presidential election over McCain/Palin, the Democratic Party has totally collapsed. The Democrats have abandoned every constituency. Democrats have discarded the American people. Democrats, in pursuit of campaign contributions, represent the moneyed interests on Wall Street, the munitions companies, the insurance companies, the agri-businesses that have destroyed independent farmers, despoilers of the environment, unaccountable police, and the builders of detention centers. The exception is Rep. Dennis Kucinich.”
http://www.opednews.com/articles/Trickle-up-economics-Fool-by-Paul-Craig-Roberts-091203-784.html
Despite Democratic majorities in the House and Senate and the ease with which Obama won the presidential election over McCain/Palin, the Democratic Party has totally collapsed. The Democrats have abandoned every constituency. Democrats have discarded the American people. Democrats, in pursuit of campaign contributions, represent the moneyed interests on Wall Street, the munitions companies, the insurance companies, the agri-businesses that have destroyed independent farmers, despoilers of the environment, unaccountable police, and the builders of detention centers. The exception is Rep. Dennis Kucinich.”
A few weeks ago, Tucson had a municipal election. My city council member was one of those who were up for re-election. On the Sunday before Election Day, I went over to the Democratic Party headquarters to lend a hand with her campaign.
To put it mildly, the place was such a mess. I doubt that it had been cleaned since Jimmy Carter was in the White House.
What really turned me off was the warning notice in the restroom. It noted the virus that was going around the building, and advised users of the restroom to wash their hands liberally (emphasis theirs, not mine).
Let’s just say that although I haven’t been to Tucson’s Republican Party HQ, I’ll bet that it gets cleaned on a regular basis. Yeah, they probably contract the work out the cleaning to a company that hires illegal aliens, but that’s Tucson for you.
As for me, I walked out of the Democratic HQ the same way I walked in, as a registered Independent.
“As for me, I walked out of the Democratic HQ the same way I walked in, as a registered Independent.”
Smart move. I’m not necessarily a party person, myself. I’m thoroughly disgusted with both parties, while I do admire a few brave souls on both sides of the aisle. But if I had to say which party was better off (much like arguing if you prefer sh*t or sh*t on toast), I’d say it was the Republicans, overall. A friend of mine once said that’s why the Dems have to work so fast and furiously during their tenure, to do as much damage as they can, because they don’t last long.
It is the party of slavery. Now, as well as then. And they don’t think they should be subject to their own laws that they pass. On a minor level, this is exemplified by Maria Shriver and her cell phone. On the major level, the article I posted below about Reid and other senators moving to exempt their states from Federal health care legislation.
I remain skeptical of the economic basis for war theory. There is always more to it than that.
What happened with Obama is he positioned himself as in favor of the “good war” in Afghanistan and merely against the “bad war” in Iraq. I knew at the time that it was purely a cynical political ploy…Axelrod had all his acolytes down to the lowliest flyover-state bloggers and letter-writers parroting the theme.
He has been hoisted on his own petard, and us with him.
In Montana,
Hate to say it, but that is exactly how gold traders worked for years. They’d take 100 people, tell half that gold is going through the roof, then tell the other 50, it’s going through the floor!
( Whichever way it pans out, those are the 50 you go back to! )
Going into the election we had a “jukubot” that parroted the Dem party line all day every day on our local Portland HB. Constantly turning the discussion political. He’d gotten several warnings from the owner and always managed to keep things just within the bounds of ‘decency’. The minute they’d won, he was no where to be seen. My guess is he was a hired hand. But… whatever works these days huh?
He’s in a tough spot and doesn’t want to just abandon Afghanistan. But I think its time to do it. Just declare victory and leave.
Kissinger did that and got a Nobel Peace prize.
Obama already got a Nobel Peace Prize, without having to declare victory and leave. Gotta hand it to those Norskis, if their idea was to influence policy by hoping Obama would end the war in Afghanistan, they screwed up royally. Wow, they really got a lesson, didn’t they? Never reward someone until the deal is done.
BTW, did he pick up his prize yet? What if he showed up and they refused to turn it over?
palmy,
I think a ‘lot’ of us are learning that lesson? What may have happened is that they looked at the train bombings in Spain ( just ‘days’ before the election ) and after witnessing how it influenced the outcome..?
Well, if it can be used for evil, than why not for good? So like everyone else, I remain utterly stunned as to how the ‘avaaard’ might have occured, but I’ll never fault someone for having tried to take the high road.
He’s not in a tough spot. He’s got to realize he’s not in a campaign any longer. It’s time to govern and stop trying to be everything to everyone.
sigh. Governing. What’s that? He was supposed to be some sort of figurehead, I guess.
Really, he is what he is: a second-rate Senator with thin credentials. And that’s as good as it gets.
I think he’ll weary of the Presidency and end up stepping down, using the excuse of risk to his life and family because of race. You heard it here first.
Clearly he’s not into this gig.
I think he’ll weary of the Presidency and end up stepping down, using the excuse of risk to his life and family because of race. You heard it here first.
That’s an astounding prediction. I’m going to remember you said that.
Egad Palmy that’s a pretty startling prediction. Or do you just mean he won’t run in 2012 (also a pretty startling prediction)?
I can’t help thinking that the cigarette habit’s going to catch up with him.
I’m saying he won’t finish out this term. Yes, I realize it’s startling, and I could end up being completely wrong, but I think there will be a black swan event that he’ll be unable to confront and “for the good of his family, the party and country” he’ll retire.
He’s not stupid. He’s just not up to it. I really think he thought it would be a cakewalk and that force of personality would make things go right, here and abroad. He doesn’t have the toughness to hang in there.
I’m saying he won’t finish out this term.
Has there ever been an American president who resigned willingly?
He doesn’t have the toughness to hang in there.
When it comes to having that, I’d rank LBJ at the top of the list of presidents during my lifetime. Although, truth be told, Vietnam turned out to be a lot tougher than he was.
Who else is on Slim’s Lifetime Tough President List?
1. Kennedy
2. Ford
3. Clinton
The tough ones:
Lincoln
Truman
Jackson
T. Roosevelt
GW Bush (In the context of the posts)
He’s to much the narcissist to quit and with
his every increasing list of blunders, goofs,
and failed speeches, even the libs are going
to toss him under the bus. I hope.
He’s to much the narcissist to quit and with
his every increasing list of blunders, goofs,
and failed speeches, even the libs are going
to toss him under the bus. I hope.
“It’s not that McCain is personally unpopular,” said a Republican pollster unaffiliated with the administration. “But with the economy on life support, it’s just that voters feel wary and nervous.”
McCain’s First 100 Days
‘We refinanced the house and now we are upside down,’ Sarah Fritchey said. ‘It’s like you’re in a free fall. Someone has to stop and catch you.’
And that “someone” is named Sarah Fritchey.
Does anyone know if this might be true? I’d like to find a more balanced report somewhere, as this one seems to have an agenda, but the central thesis of Federal lawmakers finding their own health care bill to be so repugnant, they’re moving to exempt their own states, is totally plausible, given the way things are going.
http://www.examiner.com/x-25466-DC-Independent-Examiner~y2009m10d11-Democrat-senators-exempt-home-states-from-Baucus-healthcare-bill
I know there are varying opinions on this board but I believe this article. Would you trust the same government that led us into this meltdown to “fix” the healthcare issues?
Would you trust the same government that led us into this meltdown to “fix” the healthcare issues?
I would argue that it’s not the same government.
I would think a law that blatantly favors the residents or finances of specific states would be open to a constitutional challenge.
“‘Remember The Gong Show?’ Lewis asked after Rogers closed his remarks. ‘If he starts that again next year, give him the hook.’”
Isn’t Lewis the one who got the hook?
I have offered 175,000 with a 100,000 down-payment on a lovely home built in 07 in my zip 33470. Pre bubble a home like this would sell for between 130,0000 to 150,000.
I just Found out there is another offer on the table that is “miles” away from mine, in fact they offered more than the list price of 239,900 because they need get some cash back. They can’t buy the house without this as they don’t have enough for a down payment.
This home is a short sale.
Can someone please explain to me why the banks are even allowing this?
I can’t see how the house is going to appraise so high when the tax appraisers office has a Total Market Value of $214,145 on this house.
WTF?????????
Someone in my area please give me some feedback, Michael are you still around?
Here is the listing:
http://www.platprops.com/Real-Estate/R2998100/15480-N-63rd-Pl-Loxahatchee-FL-33470
If I were you, I’d hold firm on my offer. Just give ‘er time. The price will come down to your level.
That’s good advice slim, but skb is still catching a knife on this one. There is a big cancer scare in this area and things got especially bubbly due to a research facility that was never actually built. Nothing but speculation.
Why not just give me that $100,000? I could put it to better use.
Palmetto, is that your feedback?
Thanks.
Since my office is in Royal Palm I think I can comment on this. You’re absolutely INSANE to buy in the acreage for $175,000. You may as well light that money on fire for warmth the next time a cold front moves in. That cancer scare isn’t going to disappear anytime soon either. DON’T DO IT!
I was being polite. Bad Andy said everything I wanted to say.
Here I thought I was being polite as well…
Of course you were. At least you offered something concrete instead of being flippant, like me. And I didn’t even know about the cancer scare.
I made my mistake in the real estate market and lost my entire down payment plus all of the payments I made on the mortgage over 2+ years. To see my mistake repeated over and over just sickens me. I’ve tried to talk people out of buying (with a few exceptions) but you can’t do it most of the time. I just don’t get it.
OK, well, I’ll let you have half of the $100,000.
What’s the cancer scare? Does this have to do with the groundwater?
Wow… That place looks clean. Nice lines. I have no idea if it’s worth 175k but it appears quite comfortable albeit a bit too large for my tastes.
Those exterior walls are constructed of DryVit. I’m not sure how they hold up in humid climates. FL is out of my geoghraphy.
The house is only just over 2000 under air, remember there are NO basements in Florida homes.
The house is ALL built with concrete blocks.
The thing is that this home is in prestene condition and has a ton of extra features. It was a very well cared for and maintained home.
Perfect landscaping, extra water pump for irrigation. Gas wate heater, gas cook top.
Good water softener and filter system.
Upgraded kitchen cub-boards.
Security system.
The list goes on and on.
I think for the price I am offering I am very close to not over paying.
Remember I have been paying fifteen hundred a month for rent for two years.
My mortgage would be very small.
The taxes are reasonable.
With the extra first time homebuyer credit and the tax savings on the interest on the mortgage, I feel this would be a good value for me.
This is our last home, the one we will retire in. One day it would be sold and split up four ways for our kids.
I am not concerned about the “cancer cluster” at all.
Our water has been tested and it is FINE.
I am hoping the bank rejects the other persons offer.
Thanks for the support, it seems like some on this board think that it will never be a right time to buy even when I would be saving a lot of money in payments etc.
I have done my homework, I am not bad Andy and his big foul up. He didn’t do his own homework.
I feel for his situation but really think if I lose anything over the next thirty years I would make it back what ever I lost.
Thanks again.
Even in the insane days mid-decade, I don’t think a bank would knowingly give someone a first mortgage of 100% PLUS some cash at the same time. They’d have to cut two checks, one for the seller and another for the buyer? Seems fishy to me.
Nice house, skb. The asking for something like that in my area would easily top $500,000 (even though relatively few houses above that price are selling right now). Still, these HBBers are right. The housing mess ain’t over by a long shot. You might still get it at your asking price. If it doesn’t appraise out, the other buyers are going to be SOL. Be patient and use the time to research the cancer issue.
“Be patient and use the time to research the cancer issue.”
Or use the cancer issue to your advantage. A little well placed badmouthing can sometimes be useful.
I’m not very far from you and have an offer on a house that was purchased for 314K in 2006. I am offering 110K which is about 1994 level. And I am still skittish and may pull the offer. Lately it seems that asking prices have risen on the low end and still coming down in middle and higher prices. Now I think the prices have risen on low end….it almost seems that all agents have been told to try and list them higher. Yet I see little selling. They just sit there.
My advice is not to freak out. There are other houses out there that will suit your needs. Be patient. Those homes at that price level are still coming down.
In my area there is a house that had Chinese Drywall. I walked thru when it was listed at 120K. It was a beauty and I wanted it. But then I found out about the Chinese Drywall and of course I wouldn’t touch it. But someone did and bought it at 78K. They then supposedly replaced the drywall. Then put it back on market for 150K. So I called about it just to see what they would say. No mention of the Chinese Drywall. So you might buy a house that had it….was supposedly replaced…and no one is required to mention that to you. These houses should have a permanent note attached to files….Once Had Chinese Drywall. So be very careful.
“Home may indeed be where the heart is. But sometimes it’s better to use your head.”
Muggy — that sounds like a good line to try out on your wife (if you want to get slapped…).
Be careful with using PB’s line. One little verbal slip and you will be saying something completely different. Heck, maybe that would be even better. Good luck.
“One little verbal slip and you will be saying something completely different. Heck, maybe that would be even better. Good luck.”
OMG — I have been pondering the deeper meaning behind your post all day long, and it finally hit me. I am going to try that line out, too, and see if I get lucky!
“Use your head!” was one of my father’s favorite admonitions when I was growing up.
obama says we can rebuild all of our utility and transportation infrastructure to the tune of $trillions so there will be plenty of jobs. What a jackass! Sure we could build another whole planet earth if so desired, but HOW ARE WE GOING TO PAY FOR IT??? Politicians just can’t seem to grasp this concept. Go back to your secret college and learn something, fool.
I like your anger!
‘A spiral of missed payments, paperwork and unfulfilled promises followed, and Kellee now jokes she’s ’so far underwater, the fish down here have no eyes.’
They may have no eyes down there, but I am guessing they have very big teeth.
Back in the day when I wuz a pup on the make in Boston, I used to go over to the aquarium when I was really bored and look at the fish. The ones that really existed in the deep deeps were, instead of swimming in tanks, dead and stuffed and tacked on a display background. And they did have VERY big teeth. They looked like miniature sea monsters, shaped like seahorses with huge heads and large open jaws with fangs. Used to freak the hell outta me.
So Far Underwater, The Fish Have No Eyes
This gets my vote for “Ben’s Best Quote From MSM So Far”
I will second that. H I L A R I O U S
I was reading that paper at lunch today and I laughed out loud when I read that part.
“They were relying on income from other investment homes in Lehigh Acres to cover their bills, but that income has dropped drastically because rents have fallen so much with a real estate slump.” These folks were flippers and now are broke and elderly. I have a friend who did something similar except the age is 59. They will have social security and rent or a mortage. A bleak future to be sure.
Kinda sad but they were playing with fire and got burned.
As for the bank in Buffalo, the lessons learned in that crisis just make the next one worse. The country is like an addict wanting one more hit of crack before they quit forever. Not likely.
Sorry I am so sad.
“‘Remember The Gong Show?’ Lewis asked after Rogers closed his remarks. ‘If he starts that again next year, give him the hook.’”
Ummm…*I* remember The Gong Show. People didn’t get “the hook.” They got gonged!
Maybe I’m not good at math, but can somebody explain to me how the unemployment rate can go DOWN when more unemployed people are added to the number?
how the unemployment rate can go DOWN when more unemployed people are added to the number Simple, to get a rate you prefer, just fiddle with the denominator!
There is actually a plausible economic explanation (aside from the temptation government statisticians may face to “fiddle with the denominator” as you suggest): If word gets out that “employers are hiring again,” the incentives increase for discouraged workers (those unemployed folks who long since gave up looking for work and are hence not counted in the denominator of the unemployment rate calculation) to start looking again. If the percentage increase in the labor force (the denominator of the calculation) due to discouraged workers reentering the labor force exceeds the percentage increase in the numerator due to more unemployed people, the unemployment rate will go down, even as the number unemployed continues to increase.
OMFG, did anyone see Nightly News?
There was some nutbag lady saying stingy banks “need to start lending and stop worrying about whether or not they get paid back.”
I can’t make this up.
Ben, check this phat nugget out:
http://www.tampabay.com/news/business/personalfinance/underwater-and-staying-even-more-than-money-its-about-home/1056509
“The Fritcheys, both 71, … who retired in 1986 from their landscaping business of 23 years…”
Oh boo hoo, they retired at the ripe old age of 48 and they thought that whatever was left of 23 years of earnings and interest was going to see them through the next 40 years?
People are stupid.
“I talked to a real estate agent this week who thinks the market doesn’t have to be this way. If the community’s homebuyers would agree to stop approaching home sales with an eye to hack the price down to a fraction of its original size (I know another agent who calls this ‘raping’ the seller), values would stop falling. Nearby homes would be able to be listed at prices more in tune with what the owner owes and with what the house is worth, according to some.”
This has to be one of the most assinine statements I have ever heard, buyers should not try to get the best deal possible?