Bubbles are for bathtubs. Not.
Post random thoughts, articles that I missed (use tinyurl.com and hit the highlights only), and tell us what's on your mind
January 02, 2008
BUBBLETALK - New thread to talk about the housing crash, mortgage meltdown and Housing Gambler bailout
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401 comments:
1 – 200 of 401 Newer› Newest»Straight talk from a mortgage professional. Well worth the read.
http://blogs.marketwatch.com/greenberg/2007/12/straight-talk-on-the-mortgage-mess-from-an-insider/
"The Government and the market are trying to boil this down to a ’sub-prime’ thing, especially with all constant talk of ‘resets’. But sub-prime loans were only a small piece of the mortgage mess. And sub-prime loans are not the only ones with resets. What we are experiencing should be called ‘The Mortgage Meltdown’ because many different exotic loan types are imploding currently belonging to what lenders considered ‘qualified’ or ‘prime’ borrowers. This will continue to worsen over the next few of years. When ‘prime’ loans begin to explode to a degree large enough to catch national attention, the ratings agencies will jump on board and we will have ‘Round 2′. It is not that far away."
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Isn't this the line for tickets for Supertramp?
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i just listened to hilary's speech. you know stock options are a great investing tool. but if you want trade options you have to meet certain wealth conditions and certify a certain sophistication with the asset, so that if i lose all my money i can't go sue the broker for misleading me into them.
why didn't real estate have the same rules. is it because no one ever loses in real estate? i would hate to lose ARMS for good, but when the gov't gets involved they start with the rules.
Bubbles are for bathtubs? Why, you must be referring to dear Kendra Todd...
Is the Real Estate Market in Bubble Trouble?
September 26, 2006
You can't go anywhere without hearing people talk about "the real estate bubble." Such talk drives me to distraction, and I'll tell you why. It's because there is no real estate bubble. Bubbles are for bathtubs.
Thanks, Kendra, I feel much better now.
Different people talk about whether there is a 'bubble' or not, in 2005:
http://www.businessweek.com/bwdaily/dnflash/jun2005/nf20050622_9404_db008.htm
Straight Talk on the Mortgage Mess from an Insider
Add insult to injury:
Well my postage stamp penthouse was taxed at $214.00 per sq. foot per year for 2005 and 2006.
Injury:
So, I just got notice that my 2007 taxes are going up to $252.33 per sq. foot whilst the value of my home has gone steadily down for the last year and a half.
Insult:
Governor Charlie Crist promised that Florida Property taxes would "drop like a rock." when he ran for and won the election to the office last year.
All these years the Federal Reserve were analyzing the vital statistic and fail to connect the dots on the GAP.
http://www.frbsf.org/publications/
economics/letter/2003/el2003-29.html
KEITH,
Check out The Press Enterprise (riverside) today in the business section. There is some good info on recent layoffs, and trend of local Inland Empire economy.
Also check numbers on surrounding Riverside depreciation %, these are outright scary figures. I have followed this areas numbers for about ten years and I have never seen that much downward pressure.
I believe we will test the 90's lows in this area.
Iceman
I hate we are having a housing melt down, but there was no way things could keep going like they were.
Like many people I predict a rate cut tommorrow - but I don't think a rate cut will help.
VacationCondoStore.com
Been reading this Blog for about 9 months and FINALLY talked my significant other into (trying to) sell our home and rent for the next couple of years. Wish me luck! We don't need to sell (fixed 6% for 30 years) but this is going to end really ugly.
We bought in 2005 for $224K, currently owe $185. Peak was in 2006 for $269K. KB is still building (and appear to be selling SOME -- not many). Thier base price for my sq footage is $237K. My builder was actually Maronda though.
I thought I would try listing for $235K. Was going to do FSBO with MLS listing.
Any suggestions out there??
I am in the Jacksonville Fl area, Yulee Fl (20 miles north of Jax). According to Fortune, the 5 year projected loss is 24% from June 2007.
Its geting FUGLY here in Los Angeles. Money is begining to get tight, People are begining to flood the job market, and sellers are asking too much.
Its FUGLY I tell you! FUGLY!
Keith and all other doom and gloomers, why are you folks always so negative? You folks for the past decade or two have predicted for one reason or another that the sky will fall and it hasn't so far. So why do you folks continue to predict the doom and gloom scenario?
This is a minor blip. Banks make money, they lose money.
Meanwhile, stocks are soaring, rents are up (so much for renting LOSERS!) and I'm making money!
How are those CDs doing? As well as my Apple stock?
Housing is already hitting bottom and going up in a lot of places, Countrywide goes from strength to strength, and you people STILL keep saying it's going to happen any day now.
Like you have for 10 years.
Keep flipping those burgers while I earn millions in the market and real estate!
DOPES!
Mill-e-yuns of dollars!
The stock market spiked Friday after a good jobs report-- government reported lots of new jobs.
WHERE? TELL ME WHERE? Everyone I know is getting laid off or scared to death of getting laid off!
Sure, Wendys, McDonalds, and Arbys hired a bunch of seasonal workers for $6.00 an hour (that's the huge "Service Sector" hirings the gov. reported).
Every housewife in our "Middle Class" circle is now selling Tupperware, Longaberger baskets, or Pampered Chef. My wife is getting invites to at least one of these sales shows a week! Either that or they are starting house cleaning services.
Pretty soon we will all be cleaning each others homes to earn money to go to the next Tupperware party.
Jeff in Florida - it made sense to cash out during the time when there was good financial incentive to do so - but you have a really low fixed 30 year rate. Unless you live in a crappy area or your expenses are really too much for you - there's not a huge benefit for you to rush to get out now that the bubble has popped. You're talking about listing for $11K more than you paid - and you'll be lucky to get that - some of that will go to closing costs and I'm guessing that after living there for 2 years you must have put something into the house. So if you're happy and it's as cheap as renting - you will actually be losing if you leave - most of what you pay in the first 5 years is interest. If you're unhappy and/or it's a bad neighborhood or a little more of a stretch than you realized, then by all means, get out while you still can.
Some anecdotal evidence on how the local economy was doing yesterday:
On a Sunday afternoon, just 2 weeks before Christmas, we drove past the local mall on the way to Costco. Lots of empty parking spaces there; the mall didn’t appear any more crowded than on any other weekend day of the year.
Once inside Costco (for our monthly stocking-up run), we noticed the same thing, and not wall-to-wall people like one would expect during the Christmas shopping season. The lines at the cashiers weren’t any longer than normal.
Next stop – Best Buy, to get a new computer. Most of the salespeople standing around looking bored, with few customers to pay attention to. We were treated like kings there.
Than, off to a nice local restaurant – JJ’s Fish House, which is located right on the waterfront in Poulsbo. Two other groups in the restaurant. Yes it was after the lunchtime rush, but still, where were all the people?
Then it was time for a leisurely stroll alongside the water, looking at the boats & bay. The weather wasn’t bad, but we only saw one other couple out there, and they were walking their cute puppy (as opposed to being out shopping & pumping up the economy).
Finally we stopped into one of those cute antique malls, where there are lots of little booths filled with all sorts of old knickknacks. Quite a few had signs posted: “50% off ALL items!” I picked out a blue glass bottle as a stocking stuffer for a loved one who collects colored glass.
The cashier acted irritated at being drawn away from his Internet. Apparently he wasn’t used to customers, and when I asked him how business was, he glumly answered, “About like your purchase,” (which was under $5.00).
Looks like it will be a real yawner of a holiday shopping season this year, folks. Or, perhaps everyone has suddenly realized that Christmas IS NOT ALL ABOUT SHOPPING AND PRESENTS? Nah, that’s doubtful.
More likely it’s just that the American consumer is finally all tapped out.
-Mammoth
Here you go Keith....Our friends at Countrywide want to dispel any myths we may have heard recently.
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Countrywide Wants to Help Dispel Home Buying Myths
http://tinyurl.com/25s5zj
jeff in fl,
dude selling now is a little late dontcha think?
If I were you I'd stay where you are. You have a low rate mortgage and can afford it. Moving takes time and costs money. Plus you'll have to pay closing costs, realtwhore commision.
By the time you buy again at a lower price you will have paid so much moving twice that I don't think it will be worth the hassle.
You should have moved a year ago.
mammoth:
I had the exact opposite experience this weekend in Atlanta. Went to Sam's Club on Saturday afternoon and had to park about a mile away. Jam packed with people.
Later that night I went to On The Border (Mexican chain restaurant). Again had to park at the very back of the place and waited about 10 mins. for a table.
And Friday night I went to an NHL hockey game. Game was sold sold out 18K seats. Prior to the game I was at a bar next to the arena, crazy busy.
Tax revenue for the state is through the roof this year. Income tax, sales tax, property tax, you name it. And this is not because of tax increases. The rates are the same as last year, yet the money collected is much higher.
http://www.bizjournals.com/atlanta/stories/
2007/12/03/daily33.html
$459.5 million in sales tax revenue (up 19.1 percent and $15 million in property tax revenue (up 142.3 percent). Through November, Georgia's tax revenue increased 5.4 percent to $7 billion. Also through November, corporate income tax revenue spiked 46.9 percent to $278.1 million, individual income tax revenue grew 5.2 percent to $3.6 billion, sales tax revenue rose 4.3 percent to $2.3 billion and property tax revenue jumped 55.5 percent to $30.5 million.
Anonymous 4:23 PM and WC,
Thanks for the advice.I know it’s kind of late in the game.. we should have sold last year.
I should have added, the neighborhood is OK and we can afford it. The thing is I really don’t want to be stuck in this house forever (eventually would like to get out of Jacksonville once I find a suitable job back up north). I’ve been keeping track of the sales records in my development and there were ALOT of 100% finance deals through KB/Countryfried last year. There are already 2 REO’s and 2 Lis Pendens on my street alone. Just wondering if I should get out before the 2006 resets kick in full force and while I still have some equity left.
Public apology to Peter Schiff from Ben Stein. I like the part about the hate mail. LOL Uhhhh... what's an acolyte? LOL
Lessons From the Pits
When the financial stock meltdown started, I was on a television show with Peter Schiff of Euro Pacific Capital, who warned that Merrill Lynch could be in very bad shape. I glibly said that I thought that its problems were limited and that the stock was a buy. Mr. Schiff was completely right and I was wrong. I had no idea that Mother Merrill, where I have been a happy stockholder for years, had been turned into a such a wild house of high-stakes gambling. I apologize to Mr. Schiff for my dismissal of his views, which turned out to be far superior to mine in this area. (I could do without his acolytes sending me endless hate mail, though.)
Last Saturday night - we got right into Red Rock Canyon restaurant in Fairfax, Va with NO WAIT.
Normally you would wait 1/2 - 1 hour to get into this place
(back in the good old days!)
Real estate slamming hard here, even though many still think
"it's different here!"
NOT! (in your best Borat voice...)
Just saw Implode-O-Meter discussed and shown on CNBC, talking about the magic number 200!
Can you spot how many things are wrong with this (IL Governor) Rod Blagojevich press release?
"Everybody is entitled to have a place they can call their own,but in today’s economy with the rising wave of foreclosures, we have to make sure that not only are we doing everything we can to protect hard working families from losing what they’ve worked so hard to achieve, but also that we keep developing new ideas and options for affordable housing."
I wouldnt sell in this market if you didnt have to.You will get discouraged, hang in there and wait it out,your rate 6% isnt to bad either.
Take a look at these buffoons at the mortgage blog. They thinkt he bailout is a GOOD idea.
http://implode-explode.com/forum/viewtopic.php?p=21337#21337
Fools Bash NAR:
http://tinyurl.com/yo9f8k
News Headline Out today:
"Bank of America shutting $12 billion cash fund
Cash withdrawals halted; investor redemptions paid 'in kind.' "
-----------------------
Soon there will be paniced people trying to withdraw their money from the banks.
It hath been foretold here on HP.
Think it can't happen here? Just wait and see...
-Mammoth
Mammoth,
I had quite the opposite experience in Seattle, Bellevue, Kirkland areas. Downtown Seattle was jam-packed with shoppers around Westlake this weekend.
I now take side streets when going to friends in Bellevue because it's a freaking zoo around Bel-Square area, full of shoppers and cars.
Kirkland's Costco's parking lot is almost full on the weekend.
It seems like "they" didn't get the memo, and still fully support the economy.
I did notice that people are looking for deals and carry out a lot less then in previous years, but still...
In honor of the great rock bank Led Zeppelin all I have to say is that "The Song Remains The Same" from the Houses of The Holy" Federal Reserve.
Such a "Communication Breakdown" between the Fed and reality. "How Many More Times" will you cut interest rates?
I don't think the Fed will ever know "What Is And What Should Never Be". "Your Time Is Gonna Come".
Have a great concert to the one and only Led Zeppelin!
The NAR is at it again but the MSM is no longer giving them a free ride.
http://tinyurl.com/37m5fp
Keith,
What happenend to the the ExInsider Countrywide Blog? Is it gone again?
Winter Park, FLorida - on Park Avenue last night - Very few people around.
WARNING - This bust goes beyond subprime. Prime borrowers will start leaving their homes when they realize the house they bought is now worth about 60% of what they paid for it.
I don't know why y'all are so worried...everything's JUST FINE:
http://article.nationalreview.com/?q=YTZjMDc4N2E3YmUyZTdlNTJiZDA5YWQ1NDc0MDc4Y2M=
I took a tour of the Vanderbilt mansion in Hyde Park NY last weekend and learned some interesting facts about the estate. The 600 acre property, house and furnishings cost 2.5 million in 1890. In 1940 it was donated to the national park service as a tax write off because nobody wanted to buy it even for a 90% reduced price of 250K. It's hard to believe that only a few years ago, during the bubble, there were people who swore that real estate only went up. People who forget history really are doomed to repeat it.
DENIAL! DENIAL! DENIAL! - AND YES LOCATION.........WELL YOU GUYS KNOW THE REST OF THAT ABSURD MANTRA THE HOLY BATTLECRY OF THE TERMINALLY INSANE LIERS & CHEATS WHO HAVE RAPED THE FINANCIAL WORLD-ALONG WITH THEIR HENCHMAN AND HENCHWOMEN-MY GOD THE HUMANITY!--- I DON'T THINK PEOPLE REALLY UNDERSTAND HOW BAD THINGS ARE GOING GET. THEY KEEP TRYING AND TRYING TO FIND SOMETHING POSITIVE HOWEVER THEY WILL NOT FIND IT- BECAUSE IT IS DOES NOT EXIST. YOU KNOW DENIAL IS REALLY A DEFENCE MECHANISM THAT KEEPS PEOPLE FROM DRIVING INTO ON COMING TRAFFIC OR PLAYING ON THE TRACKS FOR LITTLE WHILE ANYWAY .......THE GOVERNMENT KNOWS EXACTLY AND I MEAN EXACTLY-WHAT IT IS DOING.... THINGS HAPPEN FOR A REASON NOT BY CHANCE....REMEMBER THAT THEY CAUSE THE PROBLEM...WAIT FOR A REACTION... AND THEN COME UP WITH A SOLUTION ...IT'S HARD TO BELIEVE... BUT ONE MUST DIG DEEP TO FIND THE ANSWERS... IT IS HAPPENING RIGHT NOW BEFORE YOUR EYES..
Mammoth, you're right, when money market funds start going down, look out below. And they are...
anybody notice how cranky steve liesman has gotten lately? seems there is not a day that goes by without him getting into a shouting match with someone on cnbc....must be all that bad news he is having to talk about...
What I would like is more discussions on why the stock market just keeps going up!
I know it has to do with the falling dollar and interest rates being cut.
I have been waiting for a crash, but bad news is good news again and good news is still good news. It's nuts!
The start of the market
had more bad news from UBS writing down 10BILLION.
Then, the market was up early today on the false NAR Pending Home Sales Report today, but barely heard the 12BILLION Money Market Freeze of BOA in the middle of the day.
After hours WAMU reported its big news also of cuts!
I betcha the market is up tomorrow morning.... wacked!
I just don't get it....
I guess their is no other place to put your money.
I would appreciate any opinions.
Anectodal evidence, with some facts, from the MSM that Mammoth's story proves to be more the norm than the exception:
http://www.cnn.com/2007/US/12/10/subprime.christmas.ap/index.html
Mammoth are you dry yet????
Please let us know how you and your property (garden) are doing, post flood.
For most Filipinos, owning one’s home is a dream. For the Fil Am couple Elena and Samuel that dream was multiplied 18 times. That is, they bought and owned 18 houses. And now, home ownership is turning into a nightmare.
Hundreds of companies folded. Thousands of engineers, executives and others lost their jobs. Here in the San Francisco Bay Area, the collapse of the tech market was manifested in a curious way: Traffic on Highway 101, which could be compared to the EDSA of the Bay Area, suddenly became very, very light. It even became easier to get restaurant reservations. Why? Because the many of the thousands who flocked to the area, hoping to get a piece of the action, simply packed up and left.
But at least that crisis involved companies not really worth much anyway. The current crisis involves something much more valuable to families and individuals: their home.
To be sure, there were many speculators who reaped huge profits from the perfect storm of low interest rates and rapidly rising home prices. But these were people who probably knew the party was not going to go on forever, watched closely for signs of trouble and then got out just in time.
But majority of homebuyers didn’t get out.
That’s what happened with Elena and Samuel. They’re hard working Filipino expats who have done a great job taking care of their family.
In 2001, they bought a home for about $100,000. Rates were then still dropping, and home prices rising. Two years later, the house was worth three times more, so they sold it and bought another one. And they kept buying.
They used the equity on their home to borrow money to buy other homes, which they then rented out. While the rates stayed low and their property values continued rising, their home rental business worked, bringing in more than enough steady income.
Now, what Elena and Samuel did was not unusual. I know of many other Pinoy realtors and speculators who also took out home equity to buy one and even two homes in the Sacramento and Las Vegas, Nevada areas where prices were relatively lower. But until I found out about Elena and Samuel’s story, I had never heard of anyone buying 18 houses.
http://globalnation.inquirer.net/
mindfeeds/mindfeeds/view_article.
php?article_id=105937
On May 10, 2007, Tu Crisp's loan defaulted. On Sept. 17, the lender foreclosed.
The rise and fall of David Crisp is quite a saga, and How the World Works looks forward to the TV movie adaptation. The handsome slick son of a Vietnamese immigrant in his Armani duds and flanked by a cohort of black-suited bodyguards who planned to rebuild Bakersfield in his own image! It simply can't miss, even if Buck Owens is undoubtedly spinning in his grave.
But what does it all mean? How many other David Crisps ran wild in the great housing boom of the early 21st century? How many of the collateralized debt obligations made out of repackaged subprime mortgage securities were built from loans made to similar scammers? Certainly, there are details to Crisp's story that can safely be dismissed as "extreme." But as he told the Bakersfield Californian in 2006, as a real estate agent just starting out he bought a Corvette he couldn't afford and hired an assistant he didn't need because his strategy was to fake it until he made it.
http://www.salon.com/tech/htww/
2007/12/05/bakersfield_real_estate
/index.html
Whats the local economy like in Phoenix, Dallas, New York, Chicago,
Pittsburgh, Miami, Portland, or any other area. I try and keep everybody posted about the Inland Empire Ca ( slowing dramatically), but aside from fake fed numbers, I want to hear more from different areas. The info that we pass around is awesome and gives everyone a better understanding of what areas are currently being hit hard.
Keith keep up the great work!!!
Iceman
why is it a menorah can be put up at the white house ,but of course , we can't have a manger scene? it is quite obvious who is running this country.
DOPES!
"Mammoth are you dry yet????
Please let us know how you and your property (garden) are doing, post flood."
--------------------------
Hey, thanks for caring, FMW! Luckily, no damage to the house but the garden was hit hard - some of the raised beds are just completely GONE!
But others living nearby got it worse, so can't complain too much. That's life here in the rainy Pacific Northwest...
Still gotta work on the self-sufficiency thing despite this setback. I plan on visiting a nearby farm this weekend to get a truckload of manure to build back up the garden beds that got washed away.
Any ya know, I would rather be shoveling manure in the rain, than be out shopping at the mall.
O.K., back to housing...am considering buying the 2.3 acres adjacent to my property. Lots of talk on HP about housing, but little discussion on buying LAND.
Comments anyone???
-Mammoth
Quote:
"The Feds are ultimately gonna enact emergency legislation to buy, outright, every deadbeat mortgage on the market! Total amount: three trillion dollars! Now for the twist: The Feds are gonna tell the sheeple to stay in the homes and make the payments to the Feds."
http://tinyurl.com/3xl2wj
Toll Bros. Get Scorched in Surprise, AZ.
http://tinyurl.com/34nfgg
http://youtube.com/watch?v=wKebysMf6Y8
NSFW, but fuggin hilarious.
http://www.pbs.org/now/shows/350/preview.html
Proof that Ron Paul supporters are insane.
When considering your options in a contract dispute with a Florida Real Estate Developer, remember, filing a lawsuit is the last and most costly option.
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We are here to help you resolve your issues, not collect court enforced legal fees.
As one of the most respected and well known Contract Rescission law firms in the state, we have been very successful at resolving the majority of our case load without entering a drawn out lawsuit or court proceeding with the very well funded Real Estate Development companies.
Positive negotiations have been the keys to our success in this arena of law.
You will find, that a partial Deposit Recovery and contract rescission will usually be a more appropriate financial decision than an all or nothing litigators approach.
To date (as of 12/11/07) all of our deposit recovery clients have been taken on with a "contingency" fee structure. We only get paid if you recover some or all of your deposit.
Again, we do not want to "make a name for ourselves" in the court system, we are here to inform you of your legal rights and negotiate a contract rescission and deposit recovery on your behalf. But, be sure, if a developer is unwilling to negotiate a resolution in good faith, we will fight using whatever means necessary, including litigation, to insure our clients rights are protected.
Are you currently involved in a Florida Preconstruction or Condominium Real Estate contract dispute? Are you looking to negotiate out, before your contract closing date?
Have you spoken to a Florida Real Estate Attorney focused on Deposit Recovery and contract rescission? Do you know the protections you are afforded under Florida and Federal Law?
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We are contacted daily by attorneys across the United States looking to us for our experience in these matters.
Please call or email Deposit Recovery Services for a FREE consultation.
http://www.depositrecoveryservices.com
FARRELL NAILS IT!!:
http://tinyurl.com/25q4ua
RECESSION UNAVOIDABLE.
JUST WAIT TILL THAT IMPACTS HOUSING PRICES!!
Watching CNBC right now... Cramer and Erin are on, and she's wearing the "Cramer Melt-down Dress"-- NICE! Lets see that cleavage, Erin.
to Jeff--You seem antsy and sensing
something, maybe even subliminally..
It might not be about your house;
it might be what will happen if otherhouses get abandoned...I say sell anything over 200K that's acceptable. Go with your gut....Get out...I think very soon, no one will be getting loans. I think it's
worse than it looks..ask yourself
to know the truth when you go to sleep and see how you feel when you wake up, for no more than a week.
pkk grandma
Awe, Erin is dressing for Cramer the sad clown now. How cute. And they get matching outfits. But Cramer is disappointed the Fed didnt give the banks even more free money. Too bad, the free lunch today wasn't super sized.
http://www.cnbc.com/id/15840232?video=606994286
or
http://tinyurl.com/29jx4b
Open question, without even getting involved in prosecuting people for mortgage fraud, lets say someone took out 10 no doc subprime loans on condos' in early 2006 in Pheonix/Miami, realizes he can't flip them and decides to walk away. All of those loans are also personally secured (unless he had the brains to incorporate) and with the changes in the bankrupcy laws, there is no more chapter 13 (complete start over). Since the bank will never get full statisfaction from the foreclosures, will they hold these guys to payments plans till the day they die? Legally they can. Will they? That's my question.
The Bay Area has been soft.
In Silicon Valley, parking at the big box stores is easy to find. There are no waits in the restaurants in Palo Alto, and even Black Friday wasn't too bad.
In San Francisco, things are a bit healthier -- more shoppers buying things, more retail traffic, and Union Square was packed on Black Friday (though less packed than before). Then again, SF is populated with lots of wealthy people, and lots of out-of-towners come in to shop in Union Square, so it would be the last area in the region to feel the pinch.
I don't spend much time in the East Bay -- but East Bay malls seem as empty as South Bay and Silicon Valley malls. I was at IKEA in Emeryville, across the bay from SF, and it was spookily empty for a Saturday.
Most Bay Area residents have been tapped out for a while. Rising rents in the city have eaten into incomes, so spending is down. Rising mortgage payments are eating into incomes too and the housing ATM has shut off. Friends of mine who bought new $50K Infinitis, Cadillacs, and Lexuses early this year with their "equity" are starting to regret that decision now as houses sit, unsold.
Overall, I'd say the economy here is not quite dismal, but pretty bad. And it never recovered from the 2001 technology and travel/tourism bust. With companies like Google paring back on hiring, and housing costs so amazingly high that a middle class person cannot hope to live here on his own, I cannot see things "booming" until rents and housing come way, way down.
Since the bank will never get full statisfaction from the foreclosures, will they hold these guys to payments plans till the day they die? Legally they can. Will they?
Actually, the statute of limitations ranks unpaid debt that isn't acted on for seven years as dead.
Remember, lots of banks that own CDOs don't even have proof of transfer of the mortgage! I doubt they're going to be organized enough to avoid the "seven year rule."
And, of course, one cannot get blood from a stone. They may be "owed" money, but if they go broke themselves and don't pay their bills, the legislative environment isn't going to allow them to walk away from their debts to depositors (at our expense) while chasing up flippers.
It's also highly likely that lots of these banks simply won't exist for much longer. An out-of-business bank will have a hard time chasing down a broke debtor -- it costs money and takes organization that they just won't have. And selling the debt on to someone else won't help -- the buyer isn't going to have the documentation necessary to win in court.
Hi - I'm in San Diego and currently renting. I have been reading that as the housing market tanks, that rental prices will actually go down too, as all the converted condos go back to rental units and as homeowners who can't sell decide to rent out their units instead, causing a glut of new rentals to hit the market and thus causing prices to go down. I even read on here that this is already happening in some markets.
But, not here - it still seems like rents are very high here, for a decent neighborhood. We have 940 sq. ft., 2 bd. 1 bath, NO washer/dryer, and the place is NOT in good shape, and we are paying LESS than our neighbors with similar units, since our landlord is overseas and has forgotten to raise our rent (or do anything else w/ the property!) for the past 2 years. But, it's still way too much in my opinion for what we live in. $1200.
We are wondering when the bargains are going to start appearing, because we'd really like to rent a house or larger apartment/condo for $1500 or so. That is totally impossible right now unless you want to live in the ghetto. What percentage can we expect to see rents go down, if any?
Hmmmmmm...no house...no 401K....no job...and now no food.
Enjoy the die off...
Concerns over food inflation as harvests fail
By Javier Blas and Chris Flood in London
Published: December 11 2007 19:49
The global economy is facing a second wave of food inflation after the US
agriculture department on Tuesday warned of significant falls in stocks of
corn, wheat and soyabean and heavy demand.
Officials forecast US wheat stocks would shrink to their lowest level in 60
years, dropping from 312m bushels to 280m by the end of the 2007-08 crop
year.
The US is the world's biggest exporter of wheat and importing countries are
bidding heavily for its crops as other exporters cut supplies.
Cold weather damaged crops in Argentina and drought affected Australia's
wheat production. Flooding also damaged European crops.
Michael Lewis, of Deutsche Bank in London, said the decline in stocks and
rising shortages in large parts of Asia suggested 2008 "could deliver
another year of price shocks".
Financial Times.
Heres why the "bailout" isn't going to happen;
Q&A at a Countrywide presentation
excerpt from Jim the Realtor
http://tinyurl.com/3d6p3r
" the rate-freeze wasn't that well thought out, and probably wouldn't be used much. He believed that borrowers will need to provide income documentation (tax returns on all candidates), and borrowers will have to sign a form stating that their income/verification is accurate and true under penalty of $10,000 and 2 years in jail. He didn't think many will sign that."
So if the second lean does not have the same guarantee as the first lean, why would foreigners buy these new bail out bonds when the foreigners know that these subprime borrowers could barely paid for the first lean.
If the foreigners buy these new bail out bonds, what kind of legal recourse will these foreigners have when these new bail out bonds matures and the same subprime borrowers still can not pay for those new bail out bonds.
http://www.sfgate.com/cgi-
bin/article.cgi?
f=/c/a/2007/12/09/IN5BTNJ2V.DTL&hw=
interest+rate+'freeze'&sn=001&sc=10
00
The sole goal of the freeze is to prevent owners of mortgage-backed securities, many of them foreigners, from suing U.S. banks and forcing them to buy back worthless mortgage securities at face value - right now almost 10 times their market worth.
The ticking time bomb in the U.S. banking system is not resetting subprime mortgage rates. The real problem is the contractual ability of investors in mortgage bonds to require banks to buy back the loans at face value if there was fraud in the origination process.
And, to be sure, fraud is everywhere.
Do you remember in 1995 there was a Japanese Premium on the LIBOR rate, is that happening to America today.
Is their an American Premium on LIBOR rate.
http://www.moneyandmarkets.com/
Issues.aspx?NewsletterEntryId=
1263
Here's the key:
Even if the Fed lowered its target for fed funds to zero ... if the LIBOR rate fails to decline in tandem, or worse, actually goes up, the Fed's power to avert an economic decline in the U.S. will be shot to pieces.
And that's exactly what's beginning to happening:
What is the bubble that will end all bubble.
http://www.chinapost.com.tw/
business/2007/12/11/134436/
Derivative%2Dtrade.htm
Derivative trade soars to record US$681 trillion
Derivatives traded on exchanges surged 27 percent to a record US$681 trillion in the third quarter, the biggest increase in three years, the Bank for International Settlements said.
Interest-rate futures, contracts designed to speculate on or hedge against moves in borrowing rates, led the increase with a 31 percent increase to US$594 trillion during the three months ended Sept. 30, the Basel, Switzerland-based BIS said Monday in its quarterly review.
Are most Californian home loans tied to the LIBOR or US Treasury.
http://online.wsj.com/article/
SB119742003788522159.html
Consumers with an ARM whose annual reset rate is linked to one-year Libor are likely to see their interest rate jump to 6.75% or more. By contrast, a similar loan that's linked to one-year Treasurys is likely to reset to a rate that's about 5.75%, he says.
Libor is frequently used to set rates for ARMs made to subprime borrowers -- mainly people with scuffed credit -- as well as many ARMs that fall into the "jumbo loan" category, which currently refers to most mortgages for $417,000 or more, says Keith Gumbinger, vice president of mortgage-tracker HSH Associates. Also, roughly half of non-subprime ARMs that were originated in recent years are tied to Libor, he estimates.
The higher Libor rates complicate the Fed's efforts to assist troubled borrowers and prevent problems related to the housing crisis from spreading further through the economy.
Theoretical situation,
If anyone out there has to sell and needs advice to sell as fast as you can in this horrific market.
I am not a Realtor
1. Look at listings for your immediate targeted area with same square footage and put your price for your house as great a deal as you can. You have to seperate yourself from the pack.
2. Put your price on your sign in big red or yellow letters. All real estate signs are a dime a dozen, but if your sign stands out with a price you will draw attention.
3. Host your own open house!!!
Nobody knows your house and schools better than you do. Get as much positive info. from your city website as you can. Great schools, low crime, zoning, etc. Very few realtors actually spend any time at all on these issues yet they are of upmost importance when purchasing a property.
4. Offer a $500 incentive to buyers agent on top of %3 commission fee. As bad and so undeserving this sounds, this really works and I am certain this will bring these starving realtors with whatever clients they have to your doorstep.
Bottomline is you need to take measures to sell and it doesn't matter if mickey mouse is buying your house, you have to sell...
5. If you cannot handle a by owner transaction then I recommend Help-u-sell. You can save 2% or more this way.
By-owner transactions are easy and can obtain help from books, websites, and escrow agents.
If your nervous about the contract, pay a real estate attorney about $100 bucks to review your document.
I believe realtors are extremely overpaid!!!
6. Stage your house with what you have. Make your house appear as roomy as possible. Light candles and play soft music. Do not spend money on expensive upgrades. Make the best with what you have, clean yard and house. If you have to spend money on anything, a fresh coat of paint will do wonders inside. You paint it and buy the paint at Walmart.
7. If its desperation time, you can offer to pay for closing costs or offer a gift card at closing.
Dont give up on deals easily, if you are in a bad situation try to make something work.
Personally, I would rather be in debt $10,000 than say a $200,000 foreclosure.
Hypothetically good luck and God Bless!!!!
California is bound to be the state that's hardest hit by the housing slump.
Homeowners can expect to see price depreciation that could rival the Great Depression. As Broderick Perkins says, “The California Association of Realtors reported the median price of an existing, single-family, detached home in California dropped 9.9 percent in October, compared to the same month a year ago.
The decline was the largest year-to-year decline in CAR's history books
http://onlinejournal.com/artman/
publish/article_2721.shtml
Look at the chart of the Fed Fund Rate verse Inflation below.
http://graphics8.nytimes.com/
images/2007/12/11/business/
12122007-biz-webFED_425.gif
In 2003 Inflation started to move above 2% from 1% and the Federal Reserve started its interest rate hike to control inflation.
During that time period Inflation moved from 2% to 4% until the Federal Reserve was finally able make Inflation fall back down to almost 1% after 17 hike.
Now inflation has climb back up to the same level when the Federal Reserve first started hiking rate in 2003, but this time every speculators and hedge funds want the Federal Reserve to continue lowing interest rate.
In an environment of zero CREDIT WORTHINESS and lowing Fed fund rate what happens to INFLATION EXPECTATION and should there be a premium place on Eurodollar and the dollar LIBOR rate.
If Saudi Arabia do cut rate then their Inflation rate will continue to climb, if Saudi Arabia do not cut rate then Oil Price will go back to the $100 level.
http://www.gulf-times.com/site/
topics/article.asp?cu_no=2&item_
no=189458&version=1&template_
id=48&parent_id=28
Saudi inflation hits 12-yr high
Saudi inflation hit 5.35% in October, its highest since at least 1995, with the government raising subsidies to curb discontent over prices and the central bank facing more pressure to cut rates to defend a dollar peg.
Can the Gulf Nation average Inflation rate go up to double digit by the middle of next year if the Gulf Nation continue to lower interest rate to kept their currencies pegged to the US Dollar
http://www.arabianbusiness.com/
506186-pressure-mounts-to-abandon
-dollar-peg?ln=en
Fed cuts rates again, pressure mounts on Gulf currencies
Inflation in the Gulf is reaching record highs with rates hitting 9.3% in the UAE last year and breaking through 5% to a 10-year high in Saudi Arabia. Qatar’s rate reached 14% at the end of the third quarter, while inflation stood at 7% in Oman and 6.2% in Kuwait in September.
Fed actively considering liquidity measures: source
The End of Capitalism is almost in Sight
When can we start slaughtering republicans?
BWA HA HA HA HA
Stocks flying back up today and will erase yesterday's loss by 9:35 am
Mortgage applications surging. Second straight week of huge gains. People are buying again.
More mortgage bailouts coming thanks to Hillary and Obama.
I'd hate to be a renting HP slob with my money in a 4% savings account these days.
Sorry boys you lose again.
How many ARM’s are based on LIBOR?
I was reading an article yesterday about how the LIBOR is based on English and European rates.
If this is the case, then all of the fed cuts in the world won’t affect the interest rates charged on these loans, will it?
The reason Mideast inflation is so high is there governments haven't figured out that it's better to create economic models that understate inflation.
The crazy market is up +229 after the Feds said they'll help the banks raise money.
Dollar Rockets Higher Versus Yen, Plunges Versus Sterling After Fed Injects Liquidity
27 minutes ago
- The dollar saw a flurry of activity Wednesday morning after the The Federal Reserve surprised market watchers by announcing it will take further steps to relieve the recent credit crunch. The dollar moved lower versus the euro immediately after the 9 am ET announcement.
"Mortgage applications surging. Second straight week of huge gains. People are buying again."
Because you said? LOL.
Houses are not selling, period. Banks are not loaning money - What planet do you live on anyway?
On another thread, yesterday some Anon said...
"Expect $5.00 per pound hamburger and $5.00 per gallon milk soon."
Yesterday evening I saw apples priced at $3.99/lb in the local grocery store.
And this is in fvcking Washington State, where ~60% of this country's apples are grown!
Nope - no inflation here, folks. Nothing to worry about...just move along and keep quiet.
Hopefully your wage increases are keeping up with the cost of groceries.
-Mammoth
"Anonymous said...
BWA HA HA HA HA
Stocks flying back up today and will erase yesterday's loss by 9:35 am
Mortgage applications surging. Second straight week of huge gains. People are buying again.
More mortgage bailouts coming thanks to Hillary and Obama.
I'd hate to be a renting HP slob with my money in a 4% savings account these days.
Sorry boys you lose again."
You will soon find that you are akin to a drunk toothless halfwit, riding in the back of a pickup truck, that is about to go sailing off a cliff. Enjoy the ride Dumbo, O.K.?
Lisa needs some help and advice!
Come on HP bloggers! She's in a bad spot through no fault of her own.
http://tinyurl.com/yq2385
I just found this clip on marketwatch.com.
"Securities and Exchange Commission filing Wednesday said it now estimates that its loan loss provision for the fourth quarter will be approximately $1 billion in excess of charge-offs. Its previous forecast was between $500 million and $600 million due to slowing loan growth and ongoing credit deterioration in its loan portfolio."
So it resumes. It's probably just a seasonably adjusted downward non-permanent accounted for charge off.
The good news is applications are up. Now they can spend more money processing applicants that won't qualify.
The "crash" put seniors in a tough position. Most have not been party to the "bargain" loans. However, they are now finding it difficult to move to assisted living places or such. They can not get the equity out of their current residence.
Sites like Aplaceformom.com and Seniorresource.com now devote a lot more energy to helping folks move to appropriate facilities or communities.
well there certainly isn't any joy in mudville anymore on cnbc......it is one long day of back biting, arguing and yelling between the various talking heads on that show...my, my, it seems only yesterday when we were being told , everything is just fine...the sub prime problem is contained....now as each day goes by, everywhere you go you see finger pointing. wow, what a difference a few months can make.
warren buffet putting on a fund raiser for clinton in san francisco. typical communist. its ok for the elite to be rich but everyone else needs their help and guidance on how to live their lives and spend their money. yep, coming through loud and clear.
50% off houses-auction in Cali ... cool. "tough it out", FBs :d
http://www.youtube.com/watch?v=QVFBojFJTZM
IndyMac shares are down to $6.44.
Who is buying them?
the doom and gloom of a financial panic is setting in at cnbc. you can feel it. you can cut it with a knife. they are finally waking up to reality.
FLASH:
It's all over folks, the housing crash has finally ended. You can all go home now. Rather you can safely get back into the RE market now. PHEW! Thank God it's all finished.....
Bottom Called!
"It appears we have reached the bottom everyone is waiting for," Robin Camacho of American Realty & Investments said."
http://www.lvrj.com/business/12410511.html
As hath been foretold on HP, the housing slowdown is affecting more than just housing-related industries.
Check this out:
“Office Depot continues to attribute its weak earnings and sales to recent housing woes.”
http://tinyurl.com/36llxq
Mammoth
Oh, Robin Camacho, you shouldn't have called the bottom so soon. You know what that means, don't you? How shameful! hehehe
Merry Christmas....
Under 12,000 by Friday.....
HoHoHo.....Dooooooohhhhhh!!!!
I just came from Office Depot. Absolutely dead. I've been there a few times within the past couple of weeks--dead each time. I've been shopping quite a bit and I've noticed many stores seem unusually quiet for December.
Feel that squeeze consumers?... that's the credit crunch.
I've been shopping quite a bit and I've noticed many stores seem unusually quiet for December.
Feel that squeeze consumers?... that's the credit crunch.
================================
Aren't you kinda contradicting yourself?
Aren't you kinda contradicting yourself?
-------------------
Perhaps. I'm off for the month of December--excess vacation and comp-time, and I make well over $150K/year. Booyah!
Here's some news stories on Ameriquest.
Mortgage fix eluded lawmakers in 2001
By John Hill, December 12, 2007
The state of California had a chance to curb lending practices that would later contribute to a crisis in subprime mortgages when it set out in 2001 to regulate so-called "predatory" loans.
But lawmakers, many of whom took campaign contributions, trips to Hawaii and Rolling Stones concert tickets from subprime lenders, narrowed the legislation so much that consumer protections covered only a tiny percentage of mortgages, a review by The Bee found.
Ameriquest didn't limit its giving to campaign cash. It paid $72,000 for Assembly Democrats to attend a fundraiser in Hawaii during the Pro Bowl in 2005, including gifts, airfare, lodging at Hilton Hawaiian Village and meals – even $170 for cookies. ($yum!)
Ameriquest CA Contributions
word from a guy i know :
"Those houses (new build ones) are foam boxes made to look like houses. They are junk and are worth only maybe 15% of the value paid. I know, Ive worked in the industry. The builders are laughing all the way to the bank, and these junk boxes will fall apart soon to add insult to injury"
The head cheerleader Larry Kudlow
looked absolutely pissed off today.
I guess he is starting to realize there is a huge problem.
Goldilocks is in trouble!!!!
Next thing you know Larry will jump over his desk and try and choke out his next guest.
Keith do not take the invite to his show!!!!
"It's all over folks, the housing crash has finally ended. You can all go home now. Rather you can safely get back into the RE market now. PHEW! Thank God it's all finished.....
Bottom Called!
"It appears we have reached the bottom everyone is waiting for," Robin Camacho of American Realty & Investments said."
-------------------------
What a dumb fuck. Las Vegas will have the biggest price drops in the entire nation (or at least damn close). Banks can't even get action on REOs priced 30% off peak price. Hey Robin get ready for 50% off peak in the nice ares of town and 70% or more in the crappy parts.
"the doom and gloom of a financial panic is setting in at cnbc. you can feel it. you can cut it with a knife. they are finally waking up to reality."
I know Peter Schiff will never be on CNBC again, but it would have been funny to see all the meltdowns the cheerleaders would have after Schiff rubbed their nose in the bad news next year and the following years.
skidmark said...
Lisa needs some help and advice!
Come on HP bloggers! She's in a bad spot through no fault of her own.
http://tinyurl.com/yq2385
----
Looks like a few commentators pointed out some home truths to Lisa, and she didnt like it one little bit :)
Casey Serin is rich! His GSPG stock skyrocketed!
Countrywide Subpoenaed by Illinois
The Illinois attorney general is investigating the home loan unit of Countrywide Financial as part of the state’s expanding inquiry into dubious lending practices that have trapped borrowers in high-cost mortgages they can no longer afford.
The investigation of Countrywide in Illinois will be just the beginning. Countrywide loan officers, managers, auditors, appraisers, etc. KNEW what they were doing was wrong, but they approved the loans anyway to get the business. A lot of people will be going to court in the future, if we can hold the country together next year and civilized life continues.
Of that (civilized life) I'm not so sure. I can't see people taking it easy in the middle of a financial collapse and losing everything.
NORTHERN ROCK CEO SACKED :
http://tinyurl.com/2kzecb
(THAT'S FIRED FOR U.S. READERS)
THE FIRST OF MANY, MANY TO COME.
A MUST READ!!!!!
(that includes shit for brains the troll)
http://onlinejournal.com
/artman/publish/article
_2721.shtml
Press Leasase this week:
The BMW Group in the United States has reported a solid sales month of November. The BMW Group in the U.S. sold 26,985 vehicles. This was an increase of 4.2 percent over their total sales volume of 25,889 vehicles in November of 2006.
And today retail sales in Nov surge to highest level in 6 months.
Yep a depression is on the way.
The housing bubble is the least of our problems.
http://www.peakoil.com
/fortopic34636-0-asc-
0.html
Wake the fuck up people!!
I have lived in Phoenix for the last 2 years. I sold my home in Tucson for a decent profit and decided to rent in Phoenix in anticipation of the impending implosion.
I don't notice much of a difference in the economy. The malls still look like they are packed with people every time I drive by (although who knows how many are actually buying).
Restaurants and pubs are still packed when I go out on Dri/Sat night.
One thing that I have noticed without a doubt is the fewer numbers of H2 Hummers out on the streets. When I first moved here in 2005 - they were all over the place. I don't see them that often anymore.
The slow trainwreck continues, and if Dubai couldn't buy US ports, it can now buy US banks;
http://tinyurl.com/24dg46
Oops.
Stocks up again.
Once again HP loses.
anon 7:02
Of course malls are packed and pubs are full. The economy is still doing very well. The doomers see what they want to see. They go to a mall and if the parking lot isn't 100% full they think aha here is the proof nobody's buying anything. As if every mall were 100% packed in 2004 and 2005. No mall parking lot is every full except for maybe the Saturday before xmas.
So gloomers you go ahead and think what you want. Reality says otherwise.
As for H2s, I agree there, I've also noticed a lot less of those behemoths around. I think even people who own one are embarassed to ride in one.
RE: PEAK OIL
***************************
"Peak oil, regardless of "predictions" or "estimations" is STILL NOT a valid reason to perform mass-murders, torture, terrorize, rape, injure, black male, tell lies under oath, theft, war profiteering and the broadcast of public deceptions and related propaganda."
US Gov leaders and US Oil and Automtive Industry leaders knew this future problem back in 1974, yet decided to take advantage of the situation instead. But nevertheless, corrective action is being conducted word-wide and the transition from gasoline to new energy sources will be smooth and plenty. Just do you part.
Panic, deception, profiteering, causing pain, suffering and murder is not required, even though that's what Isreal, bush-co and cheney's 9/11 fake attack are all about.
We can all thank Helicopter for raging inflation coming. Again, who doesn't see this coming?
Inflation seen hanging over 2008 world economy
Thu Dec 13, 2007 2:21pm EST
By Steven C. Johnson
NEW YORK (Reuters) - Inflation is shaping up to be a serious threat to financial markets and the world economy next year and the timing couldn't be worse, money managers at the Reuters Investment 2008 Outlook Summit said.
Even as prices rise, a severe global credit squeeze has prompted major central banks to flood the banking system with more money than at any time since the September 11, 2001, attacks.
With that much money sloshing around, many fear high prices will push the world into a prolonged period of sluggish growth, with the U.S. economy in particular vulnerable to a rerun of 1970s-style stagflation.
"We're trying to deal with two polar opposite problems here," said Robert Kowit, an international bond fund manager with Federated Investors. "I would say (stagflation) is an increasing concern for most investors."
Stagflation, a combination of stagnation and inflation, describes periods of rising prices coupled with stalled growth.
In the 1970s, things got so bad that the United States had trouble finding buyers for its bonds, sparking a dollar crisis that saw asset prices fall and real interest rates spike.
Kowit said a rerun of that scenario is a top concern heading into 2008. Economists predict falling home prices and the credit crunch will more than halve the U.S. growth rate to 1.4 percent in the fourth quarter. Some see recession ahead.
Interest rate cuts from the Federal Reserve have also accelerated the dollar's six-year decline, sending it to a record low against the euro and potentially raising prices for already indebted U.S. consumers. Continued...
1 | 2 | 3 Next > © Reuters 2007.
"Press Leasase this week:
The BMW Group in the United States has reported a solid sales month of November. The BMW Group in the U.S. sold 26,985 vehicles. This was an increase of 4.2 percent over their total sales volume of 25,889 vehicles in November of 2006.
And today retail sales in Nov surge to highest level in 6 months.
Yep a depression is on the way."
Ooooooh Wow! That's some incredible financial analysis. Sooo dumb shits are still buying(leasing) cars most of them can't afford. How about some hot stock tips Karnac?
BTW- The retail sales increase is mostly higher food and fuel costs.
Whoa something strange happened in the past 2 weeks... Yahoo Real Estaet used to have about 40 NOD or Foreclosures on record for Hermosa Beach. Suddenly today only 2 and in very early stages (15 days)...
Maybe something HAS changed. Someone snuck a late payments reset or some new exotic loans we don't know about to bail those guys out?
"The one thing I can tell about you Realtors is that you're all liars," said Joseph Anfuso, president of Florsheim Homes, a builder in California's Central Valley.
Couldn't have said it better myself....
http://tinyurl.com/322q48
Jail coming closer
http://tinyurl.com/28nkss
Merry X-mas from Ben, George, Mozilo, and Hank! They got some moves!
Merry Christmas!
http://tinyurl.com/36p5oe
California is a fine place to live - if you happen to be an orange.
- Fred Allen
Hmmm...
If you believe so much in the stock market and the economy, then why do you even bother to waste yours and our time on hp?
You guys know the answer, there is something very strange with the stockmarket. The swings are way too violent and one can only wonder how to time this market (impossible). The fed says the economy is great then it cuts rates.
Dopes, Blowfly, and the rest of you BULL market S@@TTERS can go and start your own blog.
I found this site because I knew something was wrong and deep down inside you guys know its true.
ICEMAN
COUNTRYWIDE SUBPOENAED BY ILLINOIS
http://www.nytimes.com/2007/12/13/business/13lend.html?em&ex=1197781200&en=950a47629167fdb2&ei=5087%0A
I just read this article from the UK newspaper, the Telegraph; called the "Gnomes of Zurich"
http://tinyurl.com/225tpe
In the comments section three people had made anagrams of the article title.
Those crazy Brits!
Iceman is the typical liberal. Afraid to debate and exchange ideas. Only wants to live in his own echo chamber where everyone agrees.
What a douche.
Nice article by the BBC news.
The US sub-prime crisis in graphics
Blogger Tyrone said...
Nice article by the BBC news.
The US sub-prime crisis in graphics
http://tinyurl.com/3xmyfc
Uh hi, I'm the CEO of a large US bank. The BBC article is way too complicated for me to understand, I don't get it, what's it all about? It might be easier for me if Keith could explain it using his puppet, thank-you.
Remember that Drew Carey song cleveland rocks,clevaldn rocks...the new version is Cleveland's Fucked, Cleveland's Fucked.
Tyrone those are some ugly numbers for Cleveland
You guys need to start cashing in on your correct read of the reality in real estate. For example, at 2:00 on Dec 11 you could have bought SRS, Proshare Ultrashort Real Estate for about 92. It was close to 100 two hours later, which is pretty good, but buying the Dec 95 call has yielded 500%. With gains like that, you can tell the bozo who keeps bragging about his Apple stock that there are better gains available IF you know what you are doing. BTW, before this is all over you can forget about the Amero, our new currency will be the BOZO (hat tip to kaimu @ bill cara).
Ron Paul on Mad Money with Jim Cramer tonight at 6pm and 11pm!
This should be interesting!
political bombshell, if it is true.
http://www.lewrockwell.com/blog/lewrw/
archives/017694.html
December 14, 2007
Mitt Romney's VC Firm to Buy Clear Channel
Posted by Chris Brunner at December 14, 2007 10:25 AM
What would it cost to buy the support of just about every nationally syndicated neocon talk show host in America? About $19.5 billion, which is what Mitt Romney's private equity firm, Bain Capital, and Thomas H. Lee Partners have agreed to pay in a leveraged buyout agreement with Clear Channel Communications, the largest radio station owner in the country. This is part of a negotiation that has been pending for over a year.
Clear Channel owns more than 1,100 full-power AM, FM, and shortwave radio stations, twelve radio channels on XM Satellite Radio, and more than 30 television stations in the United States. Premiere Radio Networks, which is the largest syndication company in the United States, is a wholly owned subsidiary of Clear Channel and is home to Rush Limbaugh, Glenn Beck, and many others. Sean Hannity recently signed a large multi-market contract with Clear Channel, as well.
From an anonymous email:
"I'll bet those hosts won't reveal that conflict of interest, but it's worth noting when you hear them begin hyping Romney, which has already begun. A lot of GOP supporters will support whomever they are told to support, so be prepared for a big push for Romney. On the bright side, Romney has more vulnerabilities than Rudy, based on his record. Look at this as the GOP establishment doing us a favor. Rich men can bankroll their own campaigns (a la John Kerry), but it takes a special breed to use investors' money to buy entire networks that can operate as passive wings of a presidential campaign."
It should be noted that Mitt Romney, while no longer the CEO, remains a silent partner of Bain Capital.
Five dead, including two children, in St. Pete area
Mitch Stacy | The Associated Press
5:03 PM EST, December 14, 2007
snip;
LARGO - A teacher drowning in debt fatally shot his ex-wife and her roommate, police said, and authorities investigating the slayings found two dead children at his house. The body of an apparent suicide victim was found later in his van.
Oliver Thomas Bernsdorff, 36, went to the apartment complex where his 27-year-old ex-wife, Jennifer Davis, lived with the other victim, Andrea H. Pisanello, 53, and fatally shot them about 6:30 a.m., Largo police Lt. Mike Loux said.
snip;
The divorce records show Bernsdorff was in debt, including $135,000 in student loans, $27,000 owed the IRS, a $33,000 private loan and roughly $50,000 in credit card debt, the papers reported.
http://www.orlandosentinel.com/news/local/
state/orl-bk-largodead12142007,0,662376.story?
coll=orl_tab01_layout
Nothing really surprising here,...
Fannie CEO: housing trouble until 2009
Fri Dec 14, 5:05 PM ET
WASHINGTON - Fannie Mae's CEO told shareholders Friday he does not expect a housing market recovery until late 2009, "at the earliest," and that the mortgage-finance company is strong enough to ride out the downturn.
One shareholder unconvinced by Mudd's assurances was investor activist Evelyn Y. Davis, who rose at the meeting and urged the government-sponsored company's directors to replace Mudd with Louis Freeh, the former FBI director elected to the Fannie board last spring.
Freeh is "the only one who would clean this up and really do this right," said Davis, whose mordant criticism of the company's leaders dominated much of the two-hour meeting.
Canada is going to save the Phoenix housing market.
http://tinyurl.com/yu7ugp
P.S. it also tells you why BMW sales are up. Currency arbitrage.
Hey folks, got a good one for you.
Just noticed that if you type 'David Crisp' into wikipedia there is no record of any such individual.
Could it be that this gentleman has no public profile, or perhaps that his henchmen (they refer to themselves with more gainful titles, pr rep, lawyer, etc) delete the wiki entries daily?
It seems a healthy arm wrestle between the forces of money and privilege against open air (the blogosphere) over whether such an entry may be achieved.
I will be submitting my own entry tomorrow morning, and should be interesting to see if it holds.
Now the commie Viet Cong are just now in a feverish frenzy flipping houses in Ho Chi Minh City. Finally and a few years late, they aren't even paying the slightest attention to the calamity besetting the rest of the world.......
"Nothing can bring about huge benefits like real estate trade. So, I have spent all my savings and loans from relatives and banks investing in it," he said while scrubbing his newly-bought apartment's white-washed wall.
---Cao Xuan Lam
http://tinyurl.com/3cj326
hi fmw!
tyrone, you have got the links!
WASHINGTON (AP) -- The Senate moved Friday against the worsening mortgage crisis, voting to make it easier for thousands of homeowners with ballooning interest rates to refinance into federally insured loans...
The legislation, approved 93-1, would allow the Federal Housing Administration to back refinanced loans for borrowers who are delinquent on payments
The Senate bill raises the maximum mortgage the FHA can insure in high-cost areas like California and the Northeast from $362,790 to $417,000 - the same level as loans backed by Fannie Mae and Freddie Mac.
The House would raise the maximum mortgage to $729,750 in high-cost areas, with the higher limit a point of contention between the House, Senate and the White House.
The Senate bill would also lower the FHA down payment requirement from 3 percent to 1.5 percent... [link]
Question: If I am a deadbeat FB who is upside down on my mortgage, what exactly is my motivation to refinance? What is my motivation for paying 1.5% down? Our gubbermint is a joke. All the criminals cashed out their stock options at the top, all the rest is just cover and obfuscation. The biggest bank robbery in the history of the world took place right under our noses.
Friday CPI number way higher then expect. High lights from different news articles and BLS
ftp://ftp.bls.gov/pub/
news.release/cpi.txt
10-year yield above 4.2 percent, November Consumers Inflation highest in more than two years.
Over the last year, prices have increased 4.3 percent nationally
The consumer price core rate, rose 0.3 percent on higher clothing and rent costs. That figure also exceeded analysts' predictions.
Fuel, clothing, prescription drugs and airline tickets were among the biggest increases.
Energy prices soared a record 14.1 percent in November, led by the increase in the cost of gasoline. Diesel fuel prices jumped 35.8 percent, and home heating oil costs surged 31.5 percent.
The US Commerce Department said that retail sales jumped by 1.2 per cent in November, double the gain economists had expected.
The index for apparel increased 0.8 percent in November
Medical care costs rose 0.4 percent in November to a level 5.0
percent above a year ago.
Airline tickets were up 2.6 percent, representing the price hikes imposed by airlines because of their own rising fuel bills.
On a seasonally adjusted basis, the CPI for Urban Wage Earners and
Clerical Workers increased 0.9 percent in November.
Since the beginning of the year fresh milk prices have risen 23.2 percent. The index for cereal and bakery products increased 0.7 percent in November.
The index for housing increased 0.4 percent in November, following a 0.2 percent rise in October. Each of the three major housing groups contributed to the larger advance.
Maybe the Central Bankers plan will not work because the problem might not be an issue of liquidity, but rather an issue of CREDIT WORTHINESS.
If so should there be an American premium on USD LIBOR rate in 2008 just like a Japanese premium on the Yen LIBOR rate in 1995.
Beside isn't Japan still pumping allot of liquidity through Yen Carry Trade.
http://news.uk.msn.com/
Article.aspx?cp-documentid=
6997892
Central bankers worry whether plan will work
European Central Bank Governing Council member Klaus Liebscher said he was disappointed money market rates remained at 4.8 to 4.9 percent despite a planned liquidity injection by the world's major central banks.
"There is a certain concern that the money market is not coming down," Liebscher told reporters in Vienna.
"In the immediate aftermath dollar spreads in term funding reduced to some extent ... but are still at high levels," he said. "We are partly facing a confidence crisis among banks."
Looks like your favorite city (Phoenix) is being invaded by the great white North which is going "loonie" pardon the pun!!
http://www.businessweek.com/ap/financialnews/D8THOU100.htm
MORTGAGE MELTDOWN
Interest rate 'freeze' - the real story is fraud
The ticking time bomb in the U.S. banking system is not resetting subprime mortgage rates. The real problem is the contractual ability of investors in mortgage bonds to require banks to buy back the loans at face value if there was fraud in the origination process.
And, to be sure, fraud is everywhere. It's in the loan application documents, and it's in the appraisals. There are e-mails and memos floating around showing that many people in banks, investment banks and appraisal companies - all the way up to senior management - knew about it.
I can hear the hum of shredders working overtime, and maybe that is the new "hot" industry to invest in. There are lots of people who would like to muzzle subpoena-happy New York Attorney General Andrew Cuomo to buy time and make this all go away. Cuomo is just inches from getting what he needs to start putting a lot of people in prison. I bet some people are trying right now to make him an offer "he can't refuse."
(read the rest here)
http://tinyurl.com/343tc2
*yawn*
Fed to crack down on shady lenders
WASHINGTON (AP) -- People taking out home mortgages may gain new protections soon against shady lending practices as the Federal Reserve seeks to back even the riskiest borrowers, already hit hardest by the housing and credit crunches.
Rules expected to be proposed Tuesday would apply to loans made by all types of lenders, including banks and brokers. The plan from the Fed, which has regulatory powers over the nation's financial system, could be finalized next year. The effective date would be know then.
...
Remember in the 1970 when they were rationing gasoline, what the chances of that happening again.
http://www.sltrib.com/
business/ci_7728241
What's so troubling about the core inflation numbers - which paralleled similar data released Thursday about wholesale inflation, as measured by the producer price index - is that rise above the Fed's comfort zone.
The economy is expected to slow early next year, and usually the Fed's response would be to lower interest rates to spark economic activity.
But that fuels inflation, the rise of prices across the economy.
And the Fed does so with inflation already rising, it risks inflaming inflationary expectations.
When people start expecting inflation to grow, employees demand higher wages and businesses hike prices.
Inflation begins to feed on itself, which soon distorts investment choices, erodes the buying power of people on fixed incomes and disrupts economic decision-making everywhere.
''What you perceive is the Fed's job is becoming very difficult moving into 2008,''
If the Japanese premium started in 1995 and end in a depression in 2001, does that mean an American premium will end in another Great Depression by end of 2012 give or take several months.
Credit derivatives premium as a new Japan premium.
The Japan premium is the difference between the Euroyen LIBOR and individual bank's Euroyen LIBOR rate. Japan premium, that is, the premium in the interest rate charged to Japanese banks in the interbank market. The internationally active Japanese banks had to pay a premium in borrowing US dollars and, to a much lesser extent, Japanese yen, from western banks. The Japan premium was considered to reflect western banks' skepticism on opaque accounting and supervision.
The Japanese started to pay a premium in 1995 due to its banking crisis. The Japanese banking crisis hit its peak from 1997 to 1998. The Japan premium disappeared after the second capital injection to major banks in March 1999. But by the end of 2001, the vulnerability of Japanese banks became obvious due to low earnings, newly emerged nonperforming loans, and deflation.
We used to think that if we knew one, we knew two, because one and one are two. We are finding that we must learn a great deal more about 'and'.
Sir Arthur Eddington
Do you remember the swiftness of the U.S. action against Daiwa Bank Ltd. which stunned many Japanese observers, it was during the time BOJ were trying to counteract any potential panic in international financial markets.
Does Citigroup of the present seems a little like Daiwa Bank of the past amount the International investors.
Since August 1995, Japanese banks have had to pay a premium on Eurodollar and Euroyen interbank loans relative to their U.S. and U.K. competitors.
The Japan premium appeared in 1995 with the failure of Hyogo Bank. Prior to this bank failure, the Japanese government had arranged take-overs of insolvent banks in order to avoid failures.
http://digital.library.unt.edu/
govdocs/crs/permalink/
meta-crs-212:1
This so-called “Japan premium” provides a market indicator of investor anxiety about the ability of Japanese banks to repay loans.
The U.S. Federal Reserve reportedly has an arrangement with the Bank of Japan to provide emergency loans to Japanese banks operating overseas in exchange for U.S. Treasury securities. The collateralized loans would be extended on short notice for banks facing emergency liquidity needs.
The purpose of the arrangement is to forestall the possible sale by Japanese banks of large amounts of U.S. Government securities (thereby raising U.S. interest rates) and to boost confidence in Japan's financial system.
The Federal Reserve's arrangement with the Bank of Japan has been characterized as a "$400 billion bailout of Japanese banks."
Michael Vick house flipper failed to auction because too greedy.
http://tinyurl.com/24zabw
50% profit in less than a year for adding minimal value isn't good enough. And I'm amazed Vick lived in such a McCrapbox. Or not, given his lack of class and taste.
From WaPo article:
"After considerable coaxing by Hause [flipper], someone in the crowd indicated with a scratch of the nose that he would pay $747,000. Hause, who later said the bidder wanted to remain anonymous, and Todd retreated to another room for about five minutes and came back with the answer: No deal.
Todd said later that the $250,000 profit he would have made simply wasn't enough. "By the time you pay a commission and taxes, it gets eaten up real quick," he said
Are housing speculators victim or are the tax payers going to be the real victims.
http://www.mercurynews.com/
ci_7724733?nclick_check=1
Housing slump hits home in East San Jose
Loosened lending requirements and high-pressure sales tactics during the past three years led to a home-buying surge in San Jose, according to real estate professionals.
"I'm saddened by the fact that these people losing their houses were sold them by Latino real estate agents," said the Rev. Jose Antonio Rubio, director of ecumenical affairs for the Diocese of San Jose.
With few homes selling, some predict prices of lower-end houses will fall even more, exacerbating the problem.
Girlie Bass, a registered nurse whose husband drives for the Valley Transportation Authority, is trying to get her lender to take back the "fixer-upper" on Aetna Way in San Jose she bought for a borrowed $615,000 in 2004.
"I just want them to release me from the mortgage. Take the house. I don't care if I get a dime out of it," said Bass, who is 61.
Nora Campos, the San Jose city councilwoman who represents the area, said she's worried about the economic impact on the community and called for the city to work with state and federal legislators to stop the foreclosures and "bring some much needed relief to our working families."
Neighborhood Housing Services Silicon Valley says it is getting an average of seven requests for help a day from homeowners worried about making their mortgage payments or losing their homes.
Why don't Joe Sixpack read Housingpanic
http://www.fool.com/investing/
general/2007/12/10/
down-isnt-up-really.aspx
Seems like every week, the National Association of Realtors (NAR) finds a reason to pump residential homebuying by looking at numbers and spinning them to claim that down is up, white's the new black, a Jolly Rancher is a sprinkle.
Worse yet, the business media -- even outfits like The Wall Street Journal, where they know how to add and subtract -- parrot the NAR party line.
As a result, unless Joe Sixpack happens to drop by on a day when I'm watching the NAR, or frequents a more vigilant (and feisty) housing blog like Housingpanic, he's likely to think things are getting better. That would be wrong
Moral of the story? Don't be duped by lazy reporting and interest-group fact-flipping.
Housing has a long way to fall, and it will be taking homebuilders like Toll Brothers, Hovnanian Enterprises, and Pulte Homes down with it, along with life-supported lenders such as Countrywide Financial and desperate banks like Citigroup, Washington Mutual, and UBS. It's going to sink plenty of real estate agents, too -- which is why the NAR is working so hard to try and rebuild its media machine.
Given that any mortgage bailout is likely to be completely ineffective at best, the hissing housing bubble has a good chance of spearing the entire economy. Invest accordingly.
Inflation in oil-rich Kuwait hit 7.3 percent in the first nine months of 2007, the highest figure for 15 years, the state KUNA news agency reported, citing official statistics.
The figures said the overall inflation came from price rises in products and services, notably housing (12.5 percent), education and health (12.3), drinks and tobacco (9.6), transport (7.3), clothing (5.1), food products (4.8) and other products and services (2.5).
http://www.ameinfo.com/141931.html
So many subpoenas, so little time. Hopefully Tangelo will spend his golden years in jail, and his fortune on lawyers.
What most people need to learn in life is how to love people and use things, instead of loving things and using people.
Source - unknown
Keith,
Gov. Schwarzenegger said he would declare fiscal emergency in California. State lawmakers are looking to start cutting programs before shrinking tax revenue from the collapsed housing market leaves the state with up to a $14 billion shortfall over the next year and a half.
The Inland Empires leading cheerleader, economist John Husing,
said "My instinct is that we could well end up with negative job growth next year for the first time in my 43 years of studying this economy". Normally being an extreme optimist, he sees disturbing signs that 2008 could be the first year that the Inland region lags behind the state and nation in job growth since 1983- the earliest comparative data was available. He also believes the region could see its first drop in retail sales since the early 1990s.
Retail sales could decline and expects year-end numbers from the State Board of Equal. to show that sales declined in 2007 which would be the first since 1991. "Evidence is scattered, but the picture is beginning to form a sort of nightmare" Husing said.
All this pretty much backs up what I have been reporting here since July. The Inland Empire is in deep trouble. As far as what I could see, we are already in a deep recession. After speaking with local branch reps, city dep. reps,
local realtors, several local retailors, construction companies,
etc., the local economy has all but stalled. There are changes out here that happen every week. I AM NOT EXAGERRATING, I have seen many small businesses that were open for more than 20 years all of a sudden close down. The repos in this area are mounting every week. I have also heard that there have been hundreds of properties that have been going to the courthouse steps and maybe 5 or six get sold.
The positive for this area is still commercial and industrial development but I am almost certain that this boom will end within the year. There is a tremendous amount of speculative commercial dev. out here and I see glaring signs of over building these projects.
ICEMAN
Does anybody know what
time it really is ?
Crap! Bad link. Try this
Link to a story in the Boston Herald about the closing of several Carlson/GMAC offices in the area.
Of course, the CEO has to revert to full liar mode to explain the closure by saying "the closures represent a long-overdue consolidation."
Don't these people understand that the public has had enough of their lies? They are completely discredited.
Oops, forgot the link:
http://news.bostonherald.com/business/general/view.bg?articleid=1050909
It is so certain that Ron Paul won't be winning anything, that I normally don't feel it necessary to comment about it, but Keith...
You're overdoing it with the RP posts, to an obnoxious level. It makes me want to skip your blog in the mornings.
As a female I will never get over his stance on abortion, and he's downright nutty on several other issues as well. I saw him on TV defending his position on abortion recently, and the best thing he could come up with was an accusation that the person asking the questions must favor full-term abortions under any circumstances, just because she was obviously pro-choice.
He came across as a tactless, blubbering idiot, only slightly more defensive than the current chimp in chief.
I know that desperation for something new and different is what is driving the Ron Paul craze, but you should be careful what you wish for.
Got vaccine?
http://tinyurl.com/3afdpb
Oh wait...no vaccine for this...
Oh well.
Got bunker?
Got food?
Got ammo?
No?
Ok - enjoy the dieoff.
The way I understand it, Dr Paul’s position on abortion is that it is unconstitutional for the Federal Government to create policy on this. I am tired of campaigners using abortion, gay rights, and race issues to influence votes.
"We hold these truths to be self-evident: That all men are created equal; that they are endowed by their Creator with certain unalienable rights; that among these are life, liberty, and the pursuit of happiness..."
Did you see the news yesterday? The fed is now injecting billions into foreign banks to prop up the bubble. How do you fix a problem with the same strategy that caused it?
You nailed it Iceman. We are already in recession. I am a Los Angeles retail merchant. SALES ARE DOWN!!!! MONEY SUPPLY IS UP!!! IT AINT HELPING!!!!!! CONSUMERS ARE MAXED OUT!!!!!!! THE FED KNOWS THIS AND IS LENDING MONEY TO OUTHER COUNTRIES NOW!!!!!
DOPES
Hi Edgar.
Mozzollow the Orange Man just may earn his stripes, prison strips that is.
Does he get to keep all that money?
Kailuan wrote:
"As a female I will never get over his stance on abortion"
Is that all you damn women care about? With all the economic ande other problems we have in the U.S., all you can focus on is abortion. You're so G-d Damn selfish!
Regardless of how Paul feels about the subject, abortion will stay legal, so you'll have the right to be a slut and then have your baby sucked into a sink.
We're going to have a housing meltdown. Even if you quote the NAR's data, we'll have a huge price drop if we "normalize".
The NAR says that for the last 20 years housing normally took up about 18.4% of the median household income in the USA. The 2006 median household income was about $4940 before taxes. The 2006 average mortgage payment was around $1166 assuming a median house price was 227,500, a down payment of 20% and an interest rate of 6.63%.
But this is 23.6% of the household's income. To be 'normal', the mortgage must be no more than 18.4% of the household income. Also, interest rates before the start of the housing bubble were around 8% on average (very generous here). Assuming that wages don't drop, the average mortgage payment cannot be more than $908 per month. So...
A $908 monthly payment with 8% interest rate for 360 months and assuming a 20% down payment would round out to a median national house price of $154,681. Slightly below 2002 prices, or a drop of about 32%. Assuming that all housing is worth $19 trillion, that's a loss of $6.08 trillion. How well do you think we can weather such a loss? And this is assuming that interest rates don't go to 10% or that wages don't drop or something else stupid happens.
Keith, nice site you got here. I was going to post this over on Ben's blog but that place seems more like a social club rather than a real blog. Also, they have this unusual obsession with Joshua Trees.
A note on the politics. People think Ron Paul is the savior nowadays. Ron Paul can't and won't stop the housing meltdown, and I'm doubtful that he'll actually roll back the big government in this country. Bush promised the same thing and he made it bigger. The 2008 elections will be interesting given the political garbage floating around nowadays. You think the problems America is facing now are bad, wait until Bush is out of office. There are a ton of skeletons floating around in Washington DC's closet now. I won't go into detail into them now but what I can tell you is that it is really nasty. Besides, most people wouldn't beleive it anyways.
Americans live in a dream world....
Selling your house? Consider this checklist: Alarm clock. Cuisinart. Glassware. Wine collection. Furniture. That Hummel collection. Area rugs. Leather jackets. Laptop. Jewelry. Toiletries and towels.
A laundry list of items to pack up before you sell? Nope.
For Bay Area thieves, these are some of the items they've nicked from open houses. Stealing during the open house itself, breaking back in to grab a few things later and even backing a moving van up to a vacant, staged home, open house thieves take literally the hospitality axiom "My home is your home."
Sure, open houses have always been necessary. After all, how can someone imagine his couch in your living room if you won't let him in? But the fact remains that, to sell your house, you're opening everything in it to strangers whose motivations aren't always the best. Police, real estate agents, stagers and sellers report that people will steal anything from pocket-size souvenirs to rugs and even architectural details. And these cases are rarely reported and hard to follow up on.
"Literally, sometimes I feel like, 'If it's not nailed down, be careful; it might just walk away,' " said San Francisco stager Helen Liu. "You have to be prepared for anything."
The price of doing business
Over the past few years, news reports list at least eight open house thefts around the Bay Area, ranging from the conviction in Marin County last year of Trudy Baughman for stealing jewelry from Novato open houses to the theft of $200,000 worth of Hummel figurines in San Jose to the alleged thefts and fraud in seven Bay Area cities earlier this year for which a mother-son team are now awaiting trial.
http://www.sfgate.com/cgi-bin/
article.cgi?f=/c/a/2007/12/16/
REP1TRSCS.DTL
Question: What do I do when I owe a $450,000 first mortgage, a second at $115,000 and new houses he same as mine are selling for $500,000? I owe two months on the first and two months on the second, and I cannot pay. What do I do?
Answer: Your situation, and that of thousands of other folks like you, is serious. You are, indeed, in dire straights. You are "under water" by $65,000, not including your selling costs. And you'll probably have to take less than $500,000 to sell quickly or beat the competition.
If you are just a deadbeat who can but won't make your house payments in a timely manner, lenders have nothing to offer but a ride to the courthouse steps.
http://www.marketwatch.com/news/
These real estate gamblers are hardly the struggling home buyers often portrayed as victims of the Bay Area's and nation's foreclosure crisis. Some bought houses as often as other people buy shoes, rarely putting down any money.
The speculators were betting that home prices would continue to shoot up. Instead, when the market started softening and prices sagged, many of their properties ended up as foreclosures.
More than one-fifth of 6,557 Bay Area properties that fell into foreclosure from January through September this year were owned by investors, according to a Chronicle analysis of public records compiled by DataQuick Information Systems.
Of properties repossessed by lenders, 1 in 6 had been owned by people who had two or more foreclosures in their names. Eighteen Bay Area investors had five or more foreclosures.
The vast majority of these properties were bought with little or no money down, according to an analysis of DataQuick's loan information. About 69 percent of the investors got 100 percent financing, meaning they did not put down a dime of their own money toward the purchase prices. An additional 12 percent made down payments that were less than 5 percent of the purchase price. Only 10 percent of investors put down the standard 20 percent.
Some 80 percent of the investor-owned Bay Area foreclosures were purchased at the height of the real estate market in 2005 and 2006, public records show.
The majority (80 percent) of people who had multiple foreclosures in the nine-month period had just two.
Why would investors buy multiple properties in a pricey market where their carrying costs - mortgage payments, taxes, insurance - would certainly eclipse the potential rents?
Flipping and fraud appear to be the primary motives.
Fraud is the sinister side of flipping. Scammers artificially fattened home prices - often with the aid of inflated appraisals - so they could take out loans for more than the house was actually worth and collect wads of cash back at closing.
"They pump up the value of the house and they pocket the money and then they just walk away," said Contra Costa Assessor Gus Kramer. "It's fraud, but nobody can prove it."
"These people who were engaging in get-rich schemes, I don't have much sympathy for," said Johnson from the Public Policy Institute. "One thing that was clearly behind this was greed."
http://www.sfgate.com/cgi-bin/
article.cgi?f=/c/a/2007/12/16/
MNT0TM9V4.DTL
I do have one opposing thought about a bailout, we gave it to the automobile industry, we have been giving bailouts to corporations for years. What about someone that the home is there primary residence...perhaps those folks ought to be able to get FHA loans for whatever the balance of the loan is..with a payment that they can afford and the amount of the loan should not depend on the area fha limits. It is going to be messy but perhaps primary homeowners should get some assistance.
All's Well in the State of Denial
By Elizabeth Razzi
Sunday, December 16, 2007
Meet Pollyanna, your real estate agent. It's not the economy that's keeping buyers away; rather, it's the talk about the economy that has them sidelined.
Luis A. Lama, 2007 chairman of the board of the Northern Virginia Association of Realtors... "I remain optimistic about our region's future," he said. "It's a great time to buy, especially in Northern Virginia."
Dennis Melby, 2008 president of the Greater Capital Area Association of Realtors, called Montgomery County and the District "a good, healthy market." For 2008, he anticipates single-digit price increases, steady sales and "more-confident" buyers.
Linda Simpson, 2008 president of the Prince George's County Association of Realtors, said, "From a bust perspective, we're not doing all that bad." "Prices have stabilized; they will begin to increase soon," Simpson said.
"But this is 23.6% of the household's income. To be 'normal', the mortgage must be no more than 18.4% of the household income"
These figures refer to averages and medians (stats majors welcome to lecture me on misuse of these terms). If long term averages are to hold (reversion to mean or even a slight increase in percentage of income to mortgage ratios), then the figures must dip below the mean. Otherwise, the mean will always rise which is not the case.
For the layman, this means house prices "should" drop far below the peak (45-55% of the peak prices) in order to balance the books statistically.
Should you be buying food, water utilities, pharmaceuticals companies.
http://www.cnbc.com/
id/15840232?video=609319223&play=1
fmw sed:
Does he get to keep all that money?
There are hundreds of rats like tangelo, paulson, etc., and yes, they will keep the loot. Maybe one or two sacrificial maggots will get a few months off at the country club.
Holiday consumer spending up:
http://www.cnbc.com/id/22260762
But remember, this is the same mindless sheeple mass market that spent itself into oblivion in the real estate bubble.
Just wait til January when the credit cards come in and these over spenders demand a credit card bailout too.
Why don't be bankrupt Freddie and Fannie quicker:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aax4zzPqV9dk&refer=home
Paulson is a big idiot.
Hey shitferbrains, how's that "Dow up 400" goin for ya?
Remember "soft landing"?
Now the media has a new term - "Shallow Recession"
I wonder what will be the next one - "hopeful depression"?
Could it be the problem is not a liquidity issue but a CREDIT WORTHINESS issue.
http://in.us.biz.yahoo.com/ft/
071217/
fto121720072010228914.html?.v=1
Emergency help for financial markets entered new territory on Monday as the European Central Bank announced it would on Tuesday offer unlimited funds at below market interest rates in a special operation to head off a year-end liquidity crisis.
The surprise move, which follows last week's co-ordinated barrage of measures by the world's central banks to increase market liquidity, suggests the ECB is still frustrated at the failure to ease financial market tensions.
It came as the Federal Reserve held the first of its new credit auctions, offering to lend $20bn to banks, with another $20bn to come before the year-end. Credit markets were little moved, with low volumes in the bond market
Manhattan immune? Wall Street and inflated Euro will prop up this prime market? Yeah, right:
http://business.timesonline.co.uk/tol/business/industry_sectors/construction_and_property/article3026028.ece
Japan big banks reluctant to pay for subprime fund
Japan's top three banks are expected to resist a request to put up a total of $15 billion for a U.S.-led subprime rescue fund, a move that could further cloud prospects for the bailout plan.
Citigroup Inc, Bank of America Corp, and JPMorgan Chase & Co initiated plans for the fund to prevent a fire sale of billions of dollars of securities held by structured investment vehicles (SIVs) at the heart of the subprime mortgage crisis.
But the size and even establishment of the fund have been put in doubt in recent days amid skepticism among market players over how effective it might be and an announcement by Citigroup that it would bail out SIVs on its own.
Executives at Japan's top three megabanks have meanwhile been wondering why they were asked to shoulder such a comparatively large part of the fund, whose size has recently been estimated by media at $30-60 billion.
"It could prove quite difficult for us to put up funds for this," said an executive at one of the megabanks, adding that he did not think the fund would be able to sell the commercial paper that would in theory be supported by Japanese credit lines.
"Logically, it just doesn't make sense for us."
http://www.reuters.com/article/
businessNews/idUST13111720071217
THE LATEST NEWS:
The Fed, which has regulatory powers over the nation's banking system, is considering:
--barring or restricting lenders from penalizing subprime borrowers -- those with tarnished credit or low incomes -- who pay their loans off early.
--forcing lenders to make sure that borrowers, especially subprime ones, set aside money to pay for taxes and insurance.
--barring or limiting loans that do not require proof of a borrower's income.
--setting new standards for how lenders determine a borrower's ability to repay a home loan.
GEE, THIS SHOULD REALLY SPUR DEMAND AND END THE HOUSING BUBBLE IN MY AREA IN LA WHERE THE HOUSING TO INCOME RATIO IS STILL 10 TO 1.
ITS GONNA GET UGLY.
Wow.
ECB lends $500bn to lower rates
http://tinyurl.com/33q2et
The two-week ECB refinancing operation is the first time it has said it would offer banks unlimited funds, above a certain interest rate, since 9 August when the credit crisis started.
1/2 Trillion dump by the ECB today!!!!!!!!!
Got gold?
Got bunker?
BWA HA HA HA HA HA
Oh man I'd have to be in the shoes of you renting goons this morning. Look for the Dow to touch 14K by end of the week. Santa Claus rally is here fools, get on board or be left behind - as usual.
You keep stuffing your $5 bills under the mattress boyz. The humans will keep on making money.
BWA HA HA HA HA
Dems gutted the border fence last night.
Vote for Hitlery and soon enough the entire border will gone.
The late Aaron Russo talks about meeting a Rockefeller. Interesting.
http://tinyurl.com/yote9x
Anonymous Anonymous said...
Dems gutted the border fence last night.
Vote for Hitlery and soon enough the entire border will gone.
December 18, 2007 4:41 PM<<<
they don't want a border. we are now becoming part of the north american free trade union. why is it bush has not so much as raised a finger about the border issue? its all part of the plan. we are losing our sovereignty if we continue to elect men who are more subservient to global interest rather than our own. our national sovereignty hangs by a thread now. the american people had better wake up soon or else. so now we wait. vote for ron paul and see if we can get this man elected. if so, we wait again. if not, then i highly suggest it is time to hit the streets in one huge massive protest movement. can we do such things? i don't know for sure. but one thing i do know for sure. if ron paul is not elected then we will lose what freedoms we still have in the never ending process of globalization that is now taking place. we stand at the crossroads of history now. our nation must stand up and do what is right. the world watches. many in the world now are praying for and supporting the candidacy of ron paul. why is that? because they know what is at stake here. if we fall, all is lost in this world. as it was before and as it is now. we used to be the shining light, a beacon of peace and prosperity that shown upon the world and demonstrated to men what could be. we can be that again. but time is short. vote for ron paul, the only man capable of doing what needs to be done. he is the man of the hour, the man chosen to stand at this time in history. the price will be high but the pearl of great price is worth every penny and every drop of blood that must be shed. this country is my land from sea to shining sea. it is your land too. it is up to all of us to do what is right.
Wasn't everything supposed to be just peachy once the DemoDOLTS won?
How's that Nov 2006 vote working out for everyone?
Mr. BWA HA HA HA HA wrote
"More mortgage bailouts coming thanks to Hillary and Obama."
Let's say for the sake of argument that every single person that ALREADY owns a house in the US is guaranteed never to foreclose, but not NEW buyers. That STILL won't keep prices from dropping, because NEW buyers cannot afford to buy at such insanely high prices, and banks will be forced to further tighten lending to make up from all the forcible rate freezes and other means of not receiving money from borrowers "protected" by the gov.
Do you have any rational way to refute this, "BWA HA HA HA HA", or are you going to act like a trolling idiot?
Here's an article from the NY Times, about the bursting of the real estate bubble in South Korea.
The interesting part is in the middle, where pissed-off realtors describe their anger about the korean government acutally trying to DO something about the bubble:
Home Prices in South Korea Stalling at a High Point
SEOUL — In 30 years as a real estate broker, Chung Doo-hyun says, he has never seen a market behave the way South Korea’s is.
First, there was the wave of feverish buying that drove up housing prices across South Korea, including in Seoul’s skyscraper-studded financial district, Yoido (pronounced YUH-wee-doe), where Mr. Chung’s tiny office is. Then, about a year ago, buyers and sellers became scarce, he says. Real estate prices stopped moving. The market came to a near halt.
[...]
and the best part:
But, many economists warn that by idling the market and giving investors time to reconsider their enthusiasm for high prices, Mr. Roh may have created a different problem. They say that even if a new president reverses Mr. Roh’s antispeculative measures, prices are just as likely to fall or even collapse as they are to resume climbing.
http://tinyurl.com/2u2r3d
I just found out where shitferbrains gets his stock picks from.
http://tinyurl.com/2pqk6u
Two-thirds of Americans will cut back on spending next year because of rising gas and energy prices.
http://tinyurl.com/yw3zf8
wow! the fast money traders on cnbc are sure glum these days. what's up with that? perhaps they are losing some fast money these days. too bad.
the lyrics to the song...Renegades.... by steve vaus
From Nazareth he came, With a rag tag band
To bring, A revolution
Some would make Him King, others couldn't stand for that
The cross, Was a solution
But he rose again, and wise men follow him
He rose again, and wise men follow him
Thank God for the renegades, and the lives they lead
Far ahead of their time
Without the renegades , Lord knows where we'd be
When it comes to heroes , Renegades are mine
They railed against the crown, Another rag tag band
Declaring , Independence
They laid their bodies down, won a bloody war,
And liberty for their descendants
Thanks to the renegades, we're free today
Thanks to the renegades, we're free today
Thank god for the renegades, and the lives they lead
Far ahead of their time
Without the renegades , Lord knows where we'd be
When it comes to heroes , Renegades are mine
Where are the renegades in the world today?
Who are the renegades in the world today?
yes steve, thank God for the renegades. we are still around my friend. and we wait.
Does anyone know where to research the health of a bank? Does anyone know anything about E-trade? Why are they offering a 5.05% interest rate for a savings account? WaMu is offering this high of a rate because they could go under? Does anyone have an info on E-trade? Are they in the same class?
PropertyShark.com today released its November 2007 report covering first-time residential foreclosures in Los Angeles, Miami, Seattle and New York City. The number of new Seattle foreclosures jumped 118% in November 2007 over October 2007, and 33% over November 2006. The number of foreclosures rose in Los Angeles, 13.09% higher than last month and 233.7% higher than the same month in 2006. There were 643 residential foreclosure auctions scheduled in Miami-Dade County for November 2007.The number was stable from the prior month (638), but 111.5% higher than November 2006.
Hey Keefy check this out,
http://tinyurl.com/2g6fnf
It's kinda over my head, maybe you can decipher it better.
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ALL THE RON PAUL VIDEOS ARE HERE:
http://www.ronpaulforpresident2008.com/news/
************ ***********
http://tinyurl.com/29uv5x
the possibility now exist, that the entire united states banking system has already been whiped out.........did i just say that? God help us....
one day i was middle class and the next day i was poor.......
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