The “soft landing” is dead.

From the Wall Street Journal:

With Buyers Sidelined, Home Prices Slide
Tighter Credit, Anticipation of Further Declines Add To Worst Glut Since Late ’80s; the Foreclosure ‘Fear Factor’
By JAMES R. HAGERTY
October 25, 2007; Page D1

So many houses. So few buyers.

Home builders are slashing prices, often by more than 10%. Some people who list their homes on Craigslist.org admit they are “desperate” to sell. Inventories of unsold homes are at the highest level in nearly two decades, providing plenty of choices.

Yet a severe tightening of credit by mortgage lenders is keeping many buyers out of the market, while the huge supplies of homes for sale have persuaded others that they can wait for further price cuts.

The National Association of Realtors reported yesterday that sales of previously occupied homes in September dropped 19% from the same month a year ago to a seasonally adjusted annual rate of 5.04 million units. The trade group blamed disruptions in the mortgage market.

Meanwhile, The Wall Street Journal’s quarterly survey of housing-market conditions in 28 major U.S. metropolitan areas shows that inventories of unsold homes are still rising in most of them, prices are generally falling and overdue loan payments are piling up. (See chart)

Some forecasters now warn that home prices are unlikely to start rising in most of the country before 2009 or 2010. A year ago, many home builders and lenders still thought that the housing boom — which more than doubled prices in some areas during the first half of this decade — would end with a gentle landing. Now those hopes are dead.

“Everybody’s kind of at a stalemate now, waiting to see what happens next,” says Donna Butera, who has a business in Phoenix “staging” homes for sale, adding furniture and other decorative touches to make them more appealing. Ms. Butera and her husband, Mark, are trying to sell six homes in Phoenix and Scottsdale. They bought the properties as investments over the past few years, but now find that the rents they collect don’t cover mortgage payments that are resetting to higher levels after initial low-cost periods of a year or two.

Even so, home sales are likely to remain weak for months because lenders are still very cautious and huge supplies of homes are weighing on prices. On a national basis, the number of previously owned homes listed for sale is enough to last about 10.5 months at the current sales rate, the NAR said. The supply of detached single-family homes, at 10.2 months, is the highest since February 1988. Supplies hovered around four to five months for the first half of this decade. When the figure is longer than six months, it is considered a buyer’s market.

Inventory figures reported by Realtors probably understate supply because not all foreclosed homes are sold through real-estate agents, says Doug Duncan, chief economist at the Mortgage Bankers Association.

House prices, as measured by the S&P/Case-Shiller national index, are likely to fall about 7% this year and a similar amount in 2008, says Jan Hatzius, chief U.S. economist at Goldman Sachs in New York. He believes a further small decline is likely in 2009. Of course, house-price movements vary greatly around the country and even within metro areas; in some desirable locations with limited supply, prices are likely to keep rising.

Foreclosure headlines create a “fear factor” among buyers and prompt more to think they should wait before taking the plunge, says Jeffrey Otteau, president of Otteau Valuation Group, an East Brunswick, N.J., appraisal firm. He believes the typical home price in New Jersey will fall about 7% this year, after dropping 8% in 2006. He expects a further decline in 2008. But, he says, “when houses are priced right, they’re selling very quickly.”

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252 Responses to The “soft landing” is dead.

  1. grim says:

    From Reuters:

    Pulte posts big loss after charges

    Some of the biggest U.S. home builders reported large quarterly losses on Wednesday on big charges for lower property values and said orders continued to crumble, underlining the weaker U.S. housing market.

    Pulte Homes Inc, the No. 3 U.S. home builder, posted a quarterly loss on Wednesday, on charges topping $1 billion and said orders fell 37 percent. The billion-or-so charge puts Pulte’s write-downs and write-offs in the same ballpark of Centex Corp, the No. 4 U.S. home builder, and D.R. Horton Inc, the largest U.S. home builder, which reported a billion-plus charge last quarter.

    On Wednesday, M.D.C. Holdings Inc, the No. 10 U.S. home builder posted a net loss of $155.4 million, or $3.40 a share, after posting charges of about $254 million. At No. 8, Ryland Group Inc reported a loss of $54.7 million, or $1.30 per share, after charges of $128.1 million.

    Although Pulte’s is big, on a percentage of inventory, it brings the Bloomfield Hill, Michigan-based home builder in line with other large builders, JMP Securities analyst Jim Wilson said.

    “The question is how much more is there to go,” Wilson said. “We think there are signs that inventory is starting to find a peak, but there’s defiantly impairments to go.”

  2. grim says:

    From the WSJ:

    BofA’s Wall Street Retreat
    Casualties of Pullback:
    Investment-Bank Chief
    And 3,000 Employees
    By VALERIE BAUERLEIN
    October 25, 2007 5:35 a.m.; Page C1

    CHARLOTTE, N.C. — Bank of America Corp., in a reversal of a decade-long effort to reach the top tier of Wall Street, is forcing out the top executive at its investment-banking unit and launching a strategic review that is likely to shrink parts of the operation.

    The moves include eliminating about 3,000 jobs, with the cuts coming largely from the company’s global corporate and investment bank, which currently has about 20,000 employees. The bank said the cuts are spread throughout the unit, which includes commercial banking and treasury services in addition to capital markets and investment banking. Bank of America, known colloquially as BofA, announced the shake-up late yesterday.

  3. grim says:

    From the Florida Times Union:

    Mortgage company to lay off 300

    New Jersey-based mortgage company PHH will eliminate about 300 jobs at its Mount Laurel, N.J., and Jacksonville locations, citing the housing market slump.

    It’s not clear how many of the cuts will take place in Jacksonville. Calls to PHH were not returned Wednesday.

    “Recent housing-market developments continue to negatively impact the level of originations and profitability of mortgage companies industry-wide,” Edwards said in the e-mail, obtained by The Times-Union. “Like our competitors, we now find ourselves forced to implement a layoff.”

    Edwards left the door open for further pink slips.

    “In the past, when we have reduced the number of our team players I was able to say the cuts were over for the foreseeable future,” Edwards said in the e-mail. “This time, I am unable to promise that. We will continue to evaluate business flow and new client signings to determine if further reductions will be necessary.”

  4. grim says:

    From Bloomberg:

    Sales of New U.S. Homes Probably Declined to Lowest Since 1997

    Sales of new homes in the U.S. probably dropped in September to the lowest level in 10 years while business spending rose, showing some parts of the economy are weathering the deepening housing slump, economists said before today’s reports.

    Purchases of new homes fell 3.1 percent to an annual pace of 770,000, the fewest since May 1997, according to the median estimate of economists surveyed by Bloomberg News. Orders for long-lasting goods increased 1.5 percent after falling in August, a separate report may show.

  5. grim says:

    From Bloomberg:

    Nomura Has First Loss in Four Years on Subprime Loans

    Nomura Holdings Inc., Japan’s largest securities firm, reported its first loss in more than four years after U.S. mortgage investments plunged, forcing the company to close some operations, cut staff and shut its Chicago office.

    The net loss was 10.5 billion yen ($92 million), or 5.51 yen per share, for the three months ended Sept. 30, compared with 43.5 billion yen profit a year earlier, Tokyo-based Nomura said in a statement today. Revenue slid to 464.5 billion yen from 469.2 billion yen.

    Nomura’s U.S. arm posted a $620 million loss on subprime, prompting Chief Executive Officer Nobuyuki Koga to shut the unit’s residential mortgage operation and hampering efforts to increase international earnings. Merrill Lynch & Co. yesterday reported the biggest loss in its 93-year history after writing down $8.4 billion of subprime mortgages and leveraged debt.

  6. SG says:

    From Economist:

    Only human
    The turmoil in financial markets has posed hard questions for central banks. Their reputations are now staked on their answers

    Central banks’ success in controlling inflation has won them credibility as economic managers. But that credibility is now at risk in two ways. First, those banks, and in particular the Fed, must take some of the blame for their part in stoking the appetite for risk. Monetary policy was too loose for too long, helping to pump up housing markets in America and elsewhere.

    The great paradox is that the central banks’ mastery of inflation has made the task of keeping financial markets safe all the harder. When people are confident that inflation is low and will remain so, they may be more prepared to take on debt. That leads to an expansion of credit and the pursuit of more exotic rewards by lenders. It feeds price rises in assets such as housing and securities. It encourages excessive risk-taking. If so, how can you contain inflation without sparking occasional but dangerous bouts of insanity in asset markets? That is a riddle likely to test central bankers for a long time to come.

  7. SG says:

    From Economist:

    Lessons from the credit crunch
    Central banks have worked miracles for 30 years. Don’t count on that continuing

    Loose monetary policy is partly responsible for the mess the central bankers are now trying to clear up. Other factors contributed to the crunch, including rash lending, securitisation and globalisation: when American subprime loans went bad, banks in Leipzig (which had bought the stuff) and in Newcastle upon Tyne (which hadn’t—see article) were caught out. But whichever way you look at it, central banks kept interest rates too low for too long. That is most true of the Fed, which slashed rates between 2001 and 2003, held them at 1% for a year and then raised them in slow, predictable quarter-point steps, fuelling the housing boom. The results of that are plain to subprime borrowers facing the loss of their homes and to investors who ended up with subprime debt.

    The other two limitations are both related to central banks’ and supervisors’ ability to control a much-changed financial system. One has to do with asset-price bubbles. The macroeconomic models used by many central banks focus on short-term influences on inflation; they focus less on the supply of money and credit. Even when they do have the right tools, central banks have preferred to wait till bubbles have burst, before mopping up afterwards by cutting rates. The snag is that this can start off new bubbles (as it did after the dotcom bust).

  8. grim says:

    From NorthJersey.com:

    Landfill housing raised red flags

    Picture this: 5,000 people living in the swampy center of the Meadowlands atop old trash heaps that were the haunt of waste haulers and illegal dumpers for more than 50 years.

    The image of life in the swamps — and the potential profits of selling luxury town houses at $750,000 a pop — has been the driving force behind the EnCap Golf project.

    But it’s a vision that scared off some of New Jersey’s most prominent real estate investors, who viewed EnCap less as a profit center than a potential nightmare for future homeowners.

    Rutherford

    • 511 “market-priced” residences

    • 89 “affordable” residences

    • 200 “active-adult residential units” for seniors

    Lyndhurst

    • One hotel with as many as 750 rooms

    • 930 units for seniors

    • 850 market-priced residences (a total of 560 midrises and high-rises, 190 town houses and a total of 100 lofts and apartments)

    A separate plan calls for 1,625 residences in North Arlington in an industrial area along Porete Avenue.

  9. thatBIGwindow says:

    Xanadu is the biggest threat to the Meadowlands community. I hope it never gets completed, but sadly it will and sadly it will be a smashing success.

  10. thatBIGwindow says:

    Xanadu Developed by Colony Capital in partnership with Dune Real Estate, Credit Suisse, The Mills Corporation and KanAm. In cooperation with the New Jersey Sports and Exposition Authority. Designed by noted architecture firm The Rockwell Group.

    Some familiar names..

  11. BC Bob says:

    SG [6,7],

    The only solution is to take on the CB’s. Go against them.

  12. BC Bob says:

    [8],

    This may prove to be the biggest taxpayer rip off in the State of NJ. Now, that’s a bold statement. Encap’s lapdog, or better yet its branch office mgr., Paul Sarlo, should be hung out to dry over this.

  13. John says:

    10:00 – New Home Sales

    September new single-family homes sales are expected to keep declining. In August, sales ran at an annual pace of 795,000, from 867,000 in July. That was an 8.3% monthly drop and put the yearly decline at 21.2%. The number of homes for sale did manage to edge lower in August, with a level of 529,000, from 537,000 the month before. The decline was helped by the combination of drastically reduced building activity and sharp price cuts by many builders. Still, the number of unsold homes was large enough to cover over eight months worth of sales, the highest monthly supply of inventories since March.

    With sales still falling, builders will likely have to slash building activity and trim prices even further. Reduced building activity will have ongoing negative effects on economic growth in the second half of the year. And more price concessions for new homes could depress prices for existing homes even further.

  14. BC Bob says:

    “Ms. Butera and her husband, Mark, are trying to sell six homes in Phoenix and Scottsdale. They bought the properties as investments over the past few years, but now find that the rents they collect don’t cover mortgage payments that are resetting to higher levels after initial low-cost periods of a year or two.”

    Great candidates to deposit their “related assets” at the window.

  15. x-underwriter says:

    “Ms. Butera and her husband, Mark, are trying to sell six homes in Phoenix and Scottsdale. They bought the properties as investments over the past few years, but now find that the rents they collect don’t cover mortgage payments that are resetting to higher levels after initial low-cost periods of a year or two.”

    For anybody who doesn’t know this;
    Rule number 1 in buying an investment property – If it doesn’t pay for itself, don’t do it. Make sure you do your math before you sign on the dotted line.

  16. bi says:

    Here is what I think: if the real estate market is as bad as what media portrayed, you should be able to find bargains everywhere and the active members here should be gone by half 3 months after August credit crunch. Are sellers so stupid that they keep holding value decreasing assets? Or local market is not as bad as you perception? Now fed fund futures again figured in 100% rate cut on Oct. 31. I know the market in some part of the country is really bad, fed need to act to save the economy. The side effect is it will bring NE area real estate healthier.

  17. grim says:

    From Bloomberg:

    MBIA Reports First Loss on Slump in Mortgage Debt

    MBIA Inc., the world’s biggest bond insurer, reported its first-ever quarterly loss after writing down the value of mortgage-related debt it guarantees.

    The third-quarter loss was $36.6 million, or 29 cents a share, the Armonk, New York-based company said in a statement. Excluding the writedowns, profit of $1.52 a share missed the $1.59 average analyst estimate in a Bloomberg survey.

    MBIA and Ambac Financial Group Inc., the world’s second- largest bond insurer, both reported their first losses as the prices of mortgage securities they guaranteed declined. The insurers write derivative contracts promising to pay holders in the event of a default. MBIA said the writedowns extended to commercial mortgage securities it insured.

  18. Anxious... but waiting says:

    From Kaplan in my email this morning….

    Christmas in October – http://www.thinkkaplan.com/specials/Christmas_in_October.pdf

  19. x-underwriter says:

    The side effect is it will bring NE area real estate healthier.

    Kaplan lowering the asking price of all their properties by $50,000 indicates a healty and robust market to me!!!!!

  20. bi says:

    18#, 19#, location, location and location again. there are the areas you want to move in?

  21. pretorius says:

    Merrill Lynch in $4b Penn Station tower?

    Don’t know if anybody has noticed, but Vornado has been working for 15 years to turn Penn Station neighborhood into an extension of Times Square.

    First, Vornado bought most of the office buildings, Manhattan Mall, and Hotel Penn. Then, they negotiated entitlements to add the big signs. During the whole time, they were replacing crappy street level retailers with national brands.

    Now, Vornado could develop the HQ for one of the world’s largest investment banks, which would position the company to be selected as master developer for the west side railyards.

    Seems to me like New York City just keeps getting better.

    http://www.nytimes.com/2007/10/25/business/25lynch.html?_r=1&oref=slogin

  22. x-underwriter says:

    bi Says:
    18#, 19#, location, location and location again. there are the areas you want to move in?

    People will pay a premium up to a certain point to live in “better” towns. As that premium increases, fewer people will be willing to pay it. Why would I pay $500,000 for a shack in a better town when a new home is $300,000 in another town. As discussed previously on this blog, longtime residents of NJ are leaving and being replaced by immigrants. Someone who just moved here from Bangalore doesn’t see the difference and could care less if he lives in your haughtyville or not.

  23. bi says:

    22#,
    the reality is just opposite. most recent immigrants i know are most eager to move to “better” towns – it is a seperate issue whether these towns are really better or not.

    > Someone who just moved here from Bangalore doesn’t see the difference and could care less if he lives in your haughtyville or not.

  24. BuyNextYear says:

    “Are sellers so stupid that they keep holding value decreasing assets?”

    Why do I think that the answer may be “yes” as I visit open houses, talk to realtors and sellers?

  25. x-underwriter says:

    bi Says:
    most recent immigrants i know are most eager to move to “better” towns

    Drive through Iselin. I ‘ll bet many of the residents there are eager to move to a ‘better’ town but don’t. Many if the immigrants from India I work with here in Central Jersey are heading to South Brunswick, Montgomery, and so forth because they perceive the schools are good and there’s a lot of other people with similar backgrounds. One main factor is the proximity of religious temples. Last I checked, they weren’t prestigious towns. Many of them currently live in Woodbridge, Edison, and Piscataway which, once again, arent’ prestigious.

  26. x-underwriter says:

    Grim
    (25) please unmoderate

  27. Secondary Market says:

    2 weeks ago i went to visit a new centex-homes townhouse project in middletown: “the village at chapel hill”. before i stepped into the model unit, a sales rep. ran up to me and said there is a $30,000 incentive “this weekend only” so a 398k 2br would be just 368K if a contract was signed today. i basically turned around and told him i’d come back next month when the incentive is 75K for “that weekend only”.
    Home builders = car dealers (in this market).

  28. bi says:

    25#, they are probably not looking for “prestigious” or walkable downtown yet but at least they want to be decent school district. for example, Montgomery you mentioned is consistently ranked as one of top schools in NJ monthly. South Brunswick is truly up-and-coming due to its neighboring to other good school districts: princeton, WWP and etc.

  29. grim says:

    From Bloomberg:

    Merrill Lynch May Write Down $4 Billion More, CIBC Analyst Says

    Merrill Lynch & Co., the largest brokerage firm, may have to write down another $4 billion in the fourth quarter as the value of subprime assets continues to drop, according to CIBC World Markets.

    “Thus far, Merrill has taken the largest writedown of its financial peers, but unfortunately, we believe in aggregate it will only get larger,” CIBC analyst Meredith Whitney said in a report released yesterday. She kept her recommendation at “sector performer” while cutting her fourth quarter earnings estimate to a 50-cent per share loss.

    Goldman Sachs Group Inc. and UBS AG cut their ratings and share-price projections for New York-based Merrill Lynch after the securities firm posted the biggest loss in its 93-year history yesterday. It wrote down subprime mortgages and asset- backed bonds by $7.9 billion, posting a third-quarter loss of $2.24 billion, or $2.82 per share. It also wrote down the value of loans to finance leveraged buyouts by $463 million.

  30. John says:

    I had a nice trip business trip this week and had the opportunity to attend a dinner party with Paul Sarbanes. He briefly chatted about subprime and some of his comments were pretty interesting. He said:

    “this is an event not a crises”
    Subprime predetarty lending legislation if enacted would have a limited effect”
    “People were pushed into ownership they could not handle”
    “fee arrangements of subprime stripped equity from homeowners”
    “the market is operating one step removed from the panic buttonm”

    Senator Sarbanes basicaly then said that although he believes that when people make risky investments they should bear the loss without government intervention so we don’t create a morle hazzard. But, in this case the individuals who bought primary residences and are making payments who are about to have a huge jump in rates that may make them lose the home and hurt the ecomony as a whole it is in the banks and the govts interest to have the banks convert to a fixed reasonable rate to allow the individual to remain in the home. On a micro basis yes the banks may make more money by having the loan convert to a high rate but on a macro basis that will result in larger amounts of foreclosures which will put downward presures on prices and increase inventories further and will cost the banks more in the long run.

    He also said the govt is looking at loans make to people with large late penalties and loans that jumped to very high rates after a set amount of time. It seems mortgage brokers were targeting people on purpose who would have trouble making payments or even hoping they would go under as the fees would be very high at origination, for the late fees and once again when they tried to modify. He does not think the govt. will bail out but he thinks the regulators will presure the banks to voluntarily modify certain loans. He said the FDIC has some good guidance on this and he thinks a modifid version of that may be used as a best practice.

  31. x-underwriter says:

    Bi (28)
    So what’s your point? These towns are nice and may be up and coming but the prices don’t indicate the extreme premium you’re defending and I certainly can’t say the prices in those places are locked in at 2005 levels.

  32. bi says:

    31#, as far as i know, most recent sales in these towns are within 5% range of 2005 price. for example, some developments in south brunswick and east brunswick even traded higher than 2005 level. they are not in extreme premium and that is why they will not come down too much so to speak.

  33. bi says:

    31#, 32#, it is consistent with my recent observations: the inventories in these towns decreased from July even after credit crunch in August even some premium towns such as summit and short hills increased slightly.

  34. Nick says:

    #16

    “Are sellers so stupid that they keep holding value decreasing assets?”

    Short answer, yes, yes they are. Many bought at inflated prices and can’t afford to sell lower without taking a massive loss. This will take years to fully unravel.

  35. x-underwriter says:

    Bi (33)

    Close to half of the properties listed for sale in East Brunswick on realtor.com are under $400,000. I would hardly call that a high cost town

  36. x-underwriter says:

    Bi (33)
    Over half the properties for sale in South Brunswick are under $400,000.
    Where’s the prestige premium?

  37. bi says:

    35#, that is exactly what i said here: the housing in nnj/cnj is affordable. east brunswick is a decent school district and new homes (10 years) of 4/2.5 are around 600K.

  38. skep-tic says:

    #16

    I think real estate in the NYC area so far has been amazingly resilient, but I also think there is some seriously irrational loss aversion happening among sellers in the area, particularly in the suburbs.

    The suburbs of NYC are NOT NYC. We do not get the international buyers, the downsizing baby boomers returning to the City, or the new urbanist families who are increasingly staying in the City to raise children.

  39. grim says:

    From MarketWatch:

    New-home sales rise 4.8% in September

    Sales of new homes rebounded in September from summer sales levels that were much weaker than previously reported, the Commerce Department reported Thursday.

    Sales increased 4.8% to a seasonally adjusted annual rate of 770,000 from a revised 735,000 in August. Previously, August’s sales had been reported at a 795,000 pace.

    September’s sales were slightly higher than the 758,000 pace expected by economists surveyed by MarketWatch.

    The three previous months were revised sharply lower, which means the housing market was much weaker in the middle of the year than previous believed, and no one believed it was strong.

    The large revisions highlight the low confidence that government statisticians have in the monthly report and the frequent large revisions it undergoes. Longer trends do a better job of showing the reality of the housing market than volatile monthly numbers.

    Sales of new homes are down 23.3% in the past year. The sales figures do not account for canceled sales contracts.

  40. BC Bob says:

    JB [29],

    They never did say, nor have the others, what % of mortgage backed debt has been revalued to the depresssed market rate and what % is being valued at the model. Nor did they indicate what % of the crap has been written off.

  41. kettle1 says:

    CHI FI

    form # 95 yesteray:

    chicagofinance Says:
    October 24th, 2007 at 2:08 pm

    kettle1 Says:
    October 24th, 2007 at 10:41 am
    The government was strongly encouraging banks to forgo lending standards and hand out loans to people who should not qualify for one/or for as large an amount as given in the first place.
    rant off……

    colorless liquor distilled from mash: er…that is a pretty serious charge, and it doesn’t sound right to me…..

    CHiFi:

    I stand behind my assertion. I make that statement on the basis that the government, in the form of various politicians including the “commander in chimp” have been pushing home ownership for a while. They have been publicly calling on banks to “make the money available”. Such statements from powerful politicians amounts to a public invitation from the politicians to the banks, to run their loan business like an ATM. The banks are in no way guilt free, but the government has fully supported the run up in the current housing/loan mess.

  42. pretorius says:

    Skep-tic,

    “loss aversion happening among sellers in the area, particularly in the suburbs”

    “new urbanist families who are increasingly staying in the City to raise children”

    I agree 100% with both of these statements.

    Will loss aversion fade, causing sellers to accept lower prices? Or will sellers who don’t really need to sell take their homes off the market?

    The new urbanist trend is for real but remains limited to a few coastal metros (NY, DC, LA, SF.) Although most young families in these metros still want to move into big houses in cookie cutter suburbs, a growing number (particularly the rich and smart ones) prefer urban neighborhoods. This supports values in places like Hoboken, but it is bad news for the exurbs. Who do you think is hurting today, the young family who bought an $800k Toll condo in Hoboken, or the young family who bought a $800k Toll mcmansion in Monroe, NJ?

  43. Al says:

    bi Says:
    October 25th, 2007 at 10:15 am
    35#, that is exactly what i said here: the housing in nnj/cnj is affordable. east brunswick is a decent school district and new homes (10 years) of 4/2.5 are around 600K.

    That is exactly whats wrong with NJ..

    Average house price in US is something like 229K right now..

    Sinc when 600K uis affordable?? IS average household income in Central NJ 200K – BUll!!!

    Average household income is at about 80K-90K right now…

    So housing probably 20-50% overpriced with respect to salaries…

    Only crazy person would call 600K hous affordable.

  44. JBJB says:

    [27] Secondary Market Says:

    SMS

    I live near this development and drive by it nearly everyday. At one point, they were advertising some of these condo’s for “the mid 500’s” like it was some kind of deal. We were actually interested at one point due to the very good location, but after they finished a few we just laughed. They have to be the ugliest, chepaest looking townhomes I have ever seen.

  45. Clotpoll says:

    BC (14)-

    “Window”…or “trough”?

  46. Clotpoll says:

    x (15)-

    Waddya wanna bet they financed all those properties with option ARMs?

  47. Clotpoll says:

    bi (16)-

    “Are sellers so stupid that they keep holding value decreasing assets?”

    They may possibly be as stupid as you.

  48. chicagofinance says:

    pretorius Says:
    October 25th, 2007 at 9:16 am
    Merrill Lynch in $4b Penn Station tower?

    Seems to me like New York City just keeps getting better.

    pret: you are kidding right? so WTF happens to WFC 4? also, you have a real prepackaged idea of better…..CSFB taking over Madison Park is “better”…..I doubt that would happen with Crapensta.

  49. skep-tic says:

    #42

    Pret– I am not very familiar with Hoboken or NJ in general, so I can’t comment of the relative value of Hoboken to other NJ towns. I will say that based on my time living in Manhattan, no one I ever met considered Hoboken to be the equivalent of NYC. More commonly, people seemed to take about it in the context of places like Riverdale– i.e., halfway points between the city and the suburbs. I am not saying this to knock Hoboken (or Riverdale); it is just my impression that it is not the same thing as living in NYC and should be acknowledged as a different market.

  50. gary says:

    Given what we’ve seen in the housing market and the credit issues in the last few months, would anyone like to make a revised or updated predicition on what we’ll see in 6 to 12 months from now?

  51. Clotpoll says:

    bi (32)-

    I just sold a mint townhome in South Brunswick @ 260K…a good 29K UNDER same-community comps established as recently as July. Just to do the quick math for you, that would be a 10% haircut, of the instant variety.

    What you fail to mention is that in places like S. Brunswick, there are scads of homes- at all price levels- languishing for 200-300 DOM at 5% off ’05 prices. The actual sales activity has dwindled to almost 0, as buyers are now either tabling low offers that don’t get countered…or not making offers at all.

    This thing is only headed one way now. Those who cannot clearly see it are in deep denial.

  52. gary says:

    Hoboken = NYC NOT!!!

  53. kettle1 says:

    #35 x-underwriter Says:
    October 25th, 2007 at 10:13 am

    Bi (33)
    Over half the properties for sale in South Brunswick are under $400,000.
    Where’s the prestige premium?
    # bi Says:
    October 25th, 2007 at 10:15 am

    35#, that is exactly what i said here: the housing in nnj/cnj is affordable. east brunswick is a decent school district and new homes (10 years) of 4/2.5 are around 600K.

    Bi,

    From the US Census, in 2004 the median HOUSEHOLD income in Middlesex county was $57,000. How is a $400,000 home affordable??? affordable for the AVERAGE person in Middlesex is around $150K – $250K based on the median household income from 2004.
    A fixed rate 30yr loan of $400,000 @6.0% and $0 down leaves you with a monthly note of $2,398. @57K/yr you net about 3600/month which leaves you only $1,200 for all other monthly expenses…

    NJ By The Numbers shows that the median household income in 2004 for south brunswick was 75K, so lets be generous and say that it is now 85K. @ 85K a safe loan would be between 200K-300K. Net take home pay at 85K is about 5,000 and you are left with about $2,500 for all other monthly expenses. while this is manageable if you carry no other debt, most people have car notes, CC debt, school loans etc. 400,00 is not affordable

  54. Clotpoll says:

    BC (40)-

    How about this method of valuation?

    Any MBS dated 05/06/07 that is not fixed rate/prime= 0

  55. John says:

    Doll-Housing Crisis Set To Worsen, Mean Older Brother Says
    October 23, 2007 | Issue 43•43

    DAYTON, OH—According to 5-year-old Janie Wright’s mean older brother, Dave, 8, if unsuitable borrowers Ken and Barbie continue to default on their high-risk subprime mortgages, it could spell the worst doll-housing crisis to hit the plastic couple since someone threw their dream home’s roof out a window.

    “[Ken and Barbie] were dumb and ugly so now they’re going to lose their home and it’s going to wind up in the garbage,” said the big jerk, who predicted that since the dolls have not made a single payment, he might just have to cut off all of Barbie’s hair to sell it for extra money. “Maybe they can move into a shoe box that they barely fit into. But it won’t have any windows so they’ll suffocate and die.”

    The nasty older sibling added that since Ken and Barbie never insured the dollhouse, they would have no recourse in the event of fire, flood, or stomping

  56. Imus says:

    I consider Hoboken to be one of those “fringe” areas (like parts of Brooklyn, Harlem, Jersey City and the lesser regarded train towns like Maplewood) that will feel the most pain.

    But, in NJ, like in NYC, there is a clear line between the “haves” and the “have nots”. Towns like Summit, Short Hills, etc. will always only be affordable for the top 5% — I do not foresee any kind of doomsday RE scenario that would change that.

  57. bi says:

    51#, which development? thanks

  58. NJGal says:

    Yeah, skep-tic, having just left Hoboken, it’s definitely NOT NYC, although some people would like to pretend it is. It’s not bumble NJ or NY, but it’s not NYC.

    And I take offense to the idea that the “rich smart” people are staying urban! My hubby and I left the city. We’re not hedgefunders, but we’re well to do, and both attorneys. Another “rich smart” couple of friends of ours (attorney and business owner) moved around the corner from us (also having been in Hoboken in the past) and other “rich smart” friends (attorney and former ad exec) left Hoboken ages ago for the suburbs. The fact is there’s just as many well to do people leaving the “semi-city” areas as staying in them b/c NYC and it’s semi-city areas are just so crowded – there’s never going to be enough room for everyone in them. Many ‘burbs are crowded enough themselves – NYC will never be an entirely urban area based on population alone. It just can’t be.

  59. pretorius says:

    Skep-tic,

    The reason I used Hoboken as an example is because this is the njrereport.

    Hoboken is part of the metro area and a legitimate alternative to many parts of New York City, such as Queens. Although Hoboken is not part of New York City in a political sense, the economic and geographic link is a tight one.

    Chifi,

    Brookfield (CFO lives in Hoboken) has 6 years to find new tenants for 4 WTC. That shouldn’t be a problem.

    By “better” I mean that entrepreneurs are redeveloping crappy parts of the city into places where global financial firms want to have their HQs. I’m not saying that the city’s personality and culture are getting better because of this.

  60. SG says:

    bi: All your talk is non-sense. You very well know that RE does not come down, people don’t like reducing asking price in few months. In fact the more media writes stories, the faster housing will drop. It is a long term trend, making lower lows and lower highs. During last downturn it took at least 5 years from Peak through Trough. We are just 2 years in bust, at least 3 more years to go. Also RE bust always starts in exurb and moves inward, so Hoboken downturn is coming only after 2 more years.

    BTW: Can you post the link to your house on Realtor.com?

  61. grim says:

    From the AP:

    New home sales rose in September, but fell in northeast

    Sales of new homes posted an unexpected gain in September although the improvement came after sales had fallen to the slowest pace in more than a decade.

    The Commerce Department reported today that sales of new homes rose by 4.8 percent last month to a seasonally adjusted annual rate of 770,000 units. That level of activity was still 23.3 percent below a year ago, indicating that housing remains in a steep downturn.

    Analysts had been expecting sales would fall by 2.5 percent last month from an August sales pace that had originally been reported as 795,000 homes. However, that figure was revised sharply lower in the new report to show a sales rate of just 735,000 in August, the slowest sales pace in 11 years.

    The report showed that the median new home price in September — the point where half the homes sold for more and half for less — rose to $238,000, up 2.5 percent from August, which had seen prices fall to the lowest level in nearly a year.

    The rebound in home sales was led by a 37.7 percent surge in the West. Sales were also up 0.5 percent in the South. But sales of new homes fell by 19.5 percent in the Midwest and 6.6 percent in the Northeast.

  62. Mojo Jojo says:

    Could someone pls give me the address of 2453165 (GSMLS) in Mendham? Thanks.

    I’ve beeing looking at a home in Basking Ridge that I may be able to get for 5% above what the owner paid for it in late 2002. Even if they overpaid when they bought, does this deal seem resonable today? They’ve gone through a couple of reductions over the last 6 months that it has been listed. The RE runup seemingly started in 2001 so my logic says this deal is decent. Opinions?

  63. Justin says:

    I am surprised that no one here has discussed the “tax reform”. I’m guessing that most people here would be psyched about the AMT repeal/refactoring.

    Giant tax overhaul bill unveiled
    AMT repeal. Lower corporate tax rates. A bill Rep. Charles Rangel offers $1 trillion in cuts. Here’s how he would pay for them.

    http://money.cnn.com/2007/10/25/pf/taxes/rangel_tax_reform/index.htm?postversion=2007102511

  64. Clotpoll says:

    moe (62)-

    5 Michael Rd

  65. Jamey says:

    John: Would you kindly post the link, or at least make it clear that you’re posting 2d hand by attributing by name the sources you clip from?

    Or are you really the sort who cavorts with Sen. Sarbanne?

  66. mikeinwaiting says:

    al 43 is so right.600 home 200 down [thats a nice chunk of change to save]6.25% 30 yr 2400 month taxes 1200 per 3600 + heat, elect, phone ,car ins & lease, cell, cable .How about some life ins .1350 reasonable.4950 before you eat,buy gas & clothes!Income 100,00 {above average]net income 6400 per month $360 per week left!Can any out there live on that!Please show me the way!

  67. John says:

    Re: From the US Census, in 2004 the median HOUSEHOLD income in Middlesex county was $57,000.

    Actually that is not the mediam household income. That is the mediam household taxable income. Big difference.
    Middle class people in 2004 may have shielded 15.5 of income into the 401K, 10K in 529 and 3.5K into flex spending and a few thousand into childcare accounts. Then that same guy could of had a large increase in stock value in his 401K, 529 plan and even if it was in a taxable account as long as it did not sell it also did not count towards income. On top of that the gain in his home is 2004 did not count.

    I know plenty of run of the mill taxable 57K people who really made 77K if you did not count flex spend or 401K.

    Then they had a 100K gain in their house in 2004 and then since 2004 was a good year in stock market another 100K increase in their 401/529 and taxable accounts. They net worth actually rose 277K in 2004 but their return states 57K. Even if most of gains were on paper and they can’t touch it makes them feel richer and gives them the balls to buy 500K homes on 57K.

  68. grim says:

    Some more info on 5 Michael.

    Purchased 2/13/2006 for $1,640,000.

  69. skep-tic says:

    #59

    Pret– I think everyone understands that Hoboken absorbs some spillover from NYC and that it wouldn’t be what it is were it not so close to Manhattan.

    But it is not the same thing as NYC, no matter how close it might be. Practically speaking, getting to and from is still a relative pain (no subway). More superficially, you have all of the headaches of living in an urban environment without the cachet that comes from saying you live in NYC. You know that people care about this.

    Obviously this is not scientific, but as for the new urbanist thing, I have never met anyone who got married and had a kid who moved to Hoboken with the intention of staying there forever. I meet plenty of people who move to Brooklyn to do this.

    Other than people straight out of college, the people who move to Hoboken do so because they can’t get a family-sized apartment in the city, but just aren’t ready to completely move out to the suburbs.

    Hoboken, however nice it may be, is like limbo for a bunch of 30-somethings who are waiting for the day that (A) they make enough money to afford the nice place in Park Slope or the Upper West Side or (B) they finally break down and move all the way out to the suburbs.

    Again, Hoboken may have many desireable features, but do you really deny that the above demographic is the market there?

  70. John says:

    I was at a dinner party earlier this week with Sentor Sarbanes. He is a pretty good guy. I usually run into a congressman or senator every few months at various dinners and cocktail parties.

    Jamey Says:
    October 25th, 2007 at 11:19 am
    John: Would you kindly post the link, or at least make it clear that you’re posting 2d hand by attributing by name the sources you clip from?

    Or are you really the sort who cavorts with Sen. Sarbanne?

  71. Clotpoll says:

    grim (268)-

    Somebody in Mendham in a tight fix?

    It cannot be!

  72. kettle1 says:

    Clotpoll # 71,

    One of my family members lives on phoenix drive in mendham. In the last couple of weeks, 3 homes in the neighborhood have begun the foreclosure process, and at least 2 of the houses up for sale are for sale because the owners are in serious financial trouble and these homes have a very high chance of being foreclosed on in the near future as the the owner wont/cant drop their price due to their debt.

  73. Justin says:

    Can someone provide the address and OLP for:
    # Listing Number: 2716858
    # Town: HAWTHORNE
    on njmls.com

  74. kettle1 says:

    while towns like mendham and short hills may always be top 5% towns, there is a stinking mess (of loans and debt) under the surface in most of the top towns

  75. Stan says:

    Hoboken and Manhattan aren’t in the same league but at least they are playing the same sport. Summit, etc. are something else entirely.

  76. Clotpoll says:

    vodka (74)-

    Towns full of Stanley Johnsons.

  77. Clotpoll says:

    BC (71)-

    That team will bury the hedge fund. They’d be better off buying a fleet of yachts.

  78. pretorius says:

    Skep-tic, I agree with your Hoboken comments.

  79. John says:

    And how is this a fix for AMT? Total household income above 200K does not make for a rich person, it should be more like 500K. Very few people with under 200K get hit with AMT anyhow

    Add an income surtax: The bill proposes that high-income filers would pay at least a 4 percent surtax on adjusted gross incomes (AGI) above $200,000 for married couples filing jointly.

  80. AntiTrump says:

    #2 BOFA pull back from I-Banking

    Grim, we’have seen this story with a number of retail banks wanting a piece of the I-Banking pie. These guys throw a lot of money to get people from I-Banks, spin their wheels for a couple of years and then scale back I-Banking and lay them off.

  81. bi says:

    here is inventory numbers from realtor.com in selected central jersey towns:(take it as it is and i am not responsible for the accuracy of the numbers).

    8/7/2007: 2699
    8/21/2007: 2616
    9/6/2007: 2454
    10/23/207: 2369

    towns:
    east brunswick
    south brunswick
    cranbury
    plainsboro
    west windsor
    montgomery
    princeton
    marlboro

  82. Mike NJ says:

    Kettle,

    I totally agree. Back in the day you actually had to save $20K for each $100K on your home price. All the craziness really I think has not only changed the mindset of the mtg broker or lender that was having no
    moral issue with letting you borrow 5 to 8 times your annual income instead of the usual 2.5 times but also the borrower who now has nothing really stopping him/her from buying that $1M home in Short Hills when in reality 5 years before they would have barely qualified for a home in Metuchen. These “top commuter towns” I really do think have a large portion of people who strained to get into them.

    There is the reality of saving the DP versus the imaginary fairy tale land version of borrowing everything and rolling the dice.

    I think for a lot of people that stretched to get into that top town the perfect storm of higher rates and lower home values has caused snake eyes to appear on the horizon.

    I knew things we bad when as late as LAST OCTOBER my mtg broker asked me why I was borrowing so little based on my income and savings. I had the usual 20% down and asked him what I could qualify for. He told me he could get me more than twice what I was borrowing. I asked him who in the world did he expect to pay that monthly mtg payment.
    I don’t think he really gave a sh*t to be honest.

  83. Stu says:

    Isn’t it sad that the moral of the housing story is to simply live within your means.

    About two years ago, during the passing of the new (tougher) personal bankruptcy laws, I feared that living a non-debt lifestyle might not be a good economic decision. I felt threatened by the likelihood of the government to bail out the majority of my peers (as well as the larger U.S. population) who were in debt over their heads. When the house of cards fell, I prophecized the savers would end up bailing out the mass-consumerists through payment of the larger share of new tax hikes. I seriously pondered spending with reckless abandon.

    Now I see that as the mortgage market collapses, soon to be followed by the credit card market (an quite likely the job market), I’ll be in a position to buy a home for quarters on the dollar and will have enough money left over to furnish it quite nicely.

    For a change, it’s great to see that taking the moral high road will have lead to a positive result.

    Do you all remember the articles that pointed out that the negative U.S. savings rate was a farce since American’s had much higher home ownership than their global brethren? Well none of the writers pondered the impact of a massive drop in the value of those homes.

    So far, the FED has been printing money at a pace that is devaluing our dollar more quickly than I would like, negatively impacting those with greater savings. But besides this, I can’t think of any other cons (outside of potentially losing my job) in the event of a significant recession.

    I suppose all is good for those who save and live within their means. I feel little sympathy for those with I-phones, fancy car leases and adjustable rate mortgage payments and significant credit card debt. I can only pray that my peers don’t go looking to me for a handout.

  84. grim says:

    bi,

    Nice illustration of the seasonal nature of inventory levels in NJ.

    It’s easier to see the seasonal patterns graphically:

    http://njrereport.com/images/sep07_salesinv.gif

    Some towns trend down earlier, other later, and the patterns do change from year to year. However, it’s clear that late Summer generally represents the seasonal peak, and Winter represents the seasonal trough.

  85. x-underwriter says:

    bi Says:
    October 25th, 2007 at 11:56 am
    here is inventory numbers from realtor.com in selected central jersey towns:(take it as it is and i am not responsible for the accuracy of the numbers).

    This conversation started with my assertion that immigrants weren’t going to pay the premium asssociated with prestige towns such as, Westfield, Summit, and so forth. I then pointed out that many of them go to places in central Jersey where the prices aren’t that high. You agreed with me and now you’re posting inventory numbers which show the normal decline in the fall months.
    Where are you going with this? I’m lost. Do you know?
    Clotpoll just pointed out that he sold a place there that was 10% less than the comps from the summer would incidate.
    This conversation is one big circle jerk

  86. Stu says:

    #79 John thinks Rangel’s bill isn’t a decent AMT fix.

    My family AGI is well under $200,000 and I’m paying AMT. It doesn’t help that I pay $14,000 in property taxes on a home on less than a quarter of an acre that was built in 1923.

    I would certainly welcome his version of the bill, and although I am not rich, I am certainly in better financial shape than most people that I know. If my AGI was 200K and my tax rate was 28%, I would certainly feel a lot richer with an extra 36K in my pocket. Of course if you choose to go out and buy a new Mercedes X-987 F-series with this newfound relief, then I suppose I would agree with you.

  87. chicagofinance says:

    skep-tic Says:
    October 25th, 2007 at 11:26 am
    #59 Pret– I think everyone understands that Hoboken absorbs some spillover from NYC and that it wouldn’t be what it is were it not so close to Manhattan.But it is not the same thing as NYC, no matter how close it might be. Hoboken, however nice it may be, is like limbo for a bunch of 30-somethings who are waiting for the day….

    skep: Hoboken is small and is at a crossroads. If the newbie yuppies can force out the old guard, nuke the school system, and start anew, then I guarantee that the prices for any place that is 3BR+ will almost instantaneously double. Your general Hoboken thesis is essentially correct, but there are something that you are not fully appreciating…..there are a lot of people that strongly prefer the commuting options from there than elsewhere, especially if you work downtown or in the WFC. Also, it is physically segregated from almost everything around it. As such, it provides a kind of enclave that xenophobes relish…..

  88. pretorius says:

    Chifi,

    I think you’re from New York City and lived in Hoboken for several years.

    Do your friends and family think that you are a loser because you lived in New Jersey?

  89. Rich In NNJ says:

    Justin,

    SLD 73 MOHAWK AVE $122,500 12/29/1995

    ACT 73 MOHAWK AVE $372,000 10/18/2006
    PCH 73 MOHAWK AVE $359,900 11/20/2006
    PCH 73 MOHAWK AVE $352,900 3/28/2007
    EXP 73 MOHAWK AVE $352,900 4/17/2007

    ACT 73 MOHAWK AVE $349,900 4/30/2007
    PCH 73 MOHAWK AVE $329,900 6/22/2007
    PCH 73 MOHAWK AVE $314,900 8/14/2007
    PCH 73 MOHAWK AVE $295,000 9/13/2007
    ACT* 73 MOHAWK AVE $295,000 9/27/2007
    ARR 73 MOHAWK AVE $295,000 10/3/2007
    Taxes: $5,667

    PCH: Price Change
    EXP: Expired Listing
    ACT*/ARR: Attorney Review

  90. skep-tic says:

    so, when they finally stop the Iraq war and all of its accompanying expense, will the Democrats offer a tax cut?

  91. Justin says:

    #89 Rich In NNJ:
    Thanks a lot Rich!

  92. MJ says:

    “This conversation is one big circle jerk”

    like bi recommending his picks in spite of people asking him not to, and then accusing others of hypocrisy whey they discuss Apple etc.

  93. skep-tic says:

    #87

    Chicago– obviously not an expert on any of this, but it seems to me the #1 thing that holds most cities back (including NYC) from growing further is the relative lack of quality schools.

  94. bi says:

    my post 90# stuck in moderation. but here it is:

    you can find desperate sellers in any place any time even in westfield in red hot 2005 summer:

    808 columbus avenue, westfield, nj

    guess what? the less-valued houses sold 100K more 2 years later in the midst of worst housing recession.

    804 columbus avenue, westfield, nj

    > Clotpoll just pointed out that he sold a place there that was 10% less than the comps from the summer would incidate.

  95. John says:

    September New Home Sales
    Home sales unexpectedly rise 4.8% (Consensus: -4.5%; Decision Economics: -2.1%), but!! from a prior-month
    level revised down by 7.5%. There were also big downward revisions to the level of sales in July (-8.0%) and
    June (-4.6%).
    However, that serious toning down in recent sales numbers had little effect on estimates of the inventory of
    unsold homes, with the August level–cumulating the effect of all the revisions–up only 0.4% from the earlier
    estimate.
    Notably, the inventory fell 1.5% in September–despite the comparatively restrained pace of sales and nearly
    steady single-family housing starts (-1.7%) in the month. If the numbers could be taken at face value, the
    apparent re-establishment of control over inventories would suggest that the pace of starts might not need to
    be cut much further.
    Of course, the numbers cannot be taken completely at face value, because the sales and inventory numbers are
    not corrected for sales cancellations–so that sales are surely overstated, and the inventory understated.
    Still, the new-home picture is probably a bit more stable than the Fed anticipated–and does not, in itself,
    argue strongly for a rate cut. The FOMC’s decision in that matter will be driven by an assessment of all the
    data together.
    Some purists on the Committee might argue that moral-hazard issues should rule out decisions based on
    shades-of-gray judgments, or “insurance” motives–and with them, the hint the job is seen as nearly done when
    it might not be. A black-and-white judgment, when fully justified, could bring a black-and-white policy
    change.

  96. SG says:

    I think these Journalists should be banned.

    Today morning at 10AM headline on Yahoo Finance news said,

    Stocks Up After New Home Sales Rise

    At present it says,

    Stocks Mixed After New Home Sales Rise

  97. x-underwriter says:

    Bi,
    Arguing with you is a huge waste of time. Your points are as cloudy as the air over southern california right now, with most of them making no sense at all

  98. bi says:

    97#, if you read “bloomberg on bloomberg”, you will know that in order to deliver news quick, they have a format sheet and fill the sheet by new numbers.

  99. bi says:

    98#, why it makes no sense? seems at least we agree that central jersey is more affordable with decent schools for recent immigrants

  100. x-underwriter says:

    Once again, totally confusing.

  101. BC Bob says:

    Remember Mozilo sold to diversify. Also, he does have some big expenses, college for 9 grandchildren. I guess the education bills were payable during the last year. After all, why would he beat his comp group over the head, to acquiesce to his needs[the frequency and amount of stock sales].

    I guess it was just a coincidence that the stock fell out of bed at the same time.

    http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=CFC

  102. John says:

    Yes Stu, but you can earn your way out of AMT, your deductions as a percent of your income is high, if your deductions stay the same and you go over 200K you might be out of AMT, however Mr. Rangler now wants to soak you if you try to earn your way out of AMT.

    Stu Says:
    October 25th, 2007 at 12:11 pm
    #79 John thinks Rangel’s bill isn’t a decent AMT fix.

    My family AGI is well under $200,000 and I’m paying AMT. It doesn’t help that I pay $14,000 in property taxes on a home on less than a quarter of an acre that was built in 1923.

  103. John says:

    Speaking of CJs, immigrants often move to older established neighborhoods with low taxes and great schools. However, the reason the schools are great as it is an older crowd that has less kids and the residents are english speakers whose parents often have masters degrees. Less kids equals more money per kid.

    Todays immigrants travel in packs. One or two moves to a neighbor hood with low taxes and great schools and slowly but surely older retired couples who pay taxes with no kids in the district gets replaced with a family with poor english skills with three kids. Taxes start to rise as three kids can cost the town 40K a year to educate yet the new owner pays only 10K a year in taxes, test scores fall as the new kids are behind. Soon within ten years the first wave of immagrants who moved to the town for low taxes and good schools has caused the town to have high taxes and mediocre skills. 30 years ago immigrants dispersed and tried to fit into the towns they joined, today they like to cluster in towns and often bring their own problems to the new town.

  104. Mike NJ says:

    Quick question for the board. I have been hit by AMT in the past due to the fact that I wrote off my MBA at 45K a year for the last two years. Now that I am a homeowner and have the mtg interest tax deduction, does this count the exact same as my “non reimbursed business expense” deduction in the eyes of the IRS? For some reason I thought that mtg interest deduction would not take you into the AMT all by itself. It could all be wishful thinking though.

    Thanks

  105. chicagofinance says:

    pretorius Says:
    October 25th, 2007 at 12:18 pm
    Chifi,I think you’re from New York City and lived in Hoboken for several years. Do your friends and family think that you are a loser because you lived in New Jersey?

    pret: When I was 15, if you told me that I would be living and working in NJ, then I can assure you that I would never have seen 16.

    Bearing that in mind, the only people I know who have an issue with Hoboken are those from wealthy families that have fallen behind everyone else, because they already had money and weren’t driven to succeed. As a result, it is their only crutch for their self-esteem.

    You know as well as I do that anyone who is close-minded about such things makes themselves look foolish, or just out of touch, in many except the most purely superficial circles.

  106. Everything's 'boken says:

    69#
    ‘getting to and from is still a relative pain (no subway). More superficially, you have all of the headaches of living in an urban environment without the cachet that comes from saying you live in NYC.’

    Please explain the distinction between the PATH train and the subway. There are a number of people who actually prefer the ‘college town’ feel here. And too, here are some for whom NYC engenders claustrophobia.

  107. chicagofinance says:

    BC Bob Says:
    October 25th, 2007 at 12:57 pm
    OT. Ouch. http://www.marketwatch.com/quotes/wcg

    Bost: Due to laughter I was overcome by a simultaneous evacuation from my abdomen and bowels….

  108. chicagofinance says:

    Bost: WCG had been going full steam….imagine you were just an average trader shorting this one, because it looked like a good bet…..

  109. Clotpoll says:

    Stu (83)-

    You should’ve spent like crazy. Savers will end up being punished when all is said and done.

    There’s no doubt the US taxpayer will pick up the tab for this mess…AND, thousands of loans will be recast.

  110. John says:

    Mike NJ Says:
    October 25th, 2007 at 12:53 pm
    First of all the only way you can write off the total cost of a MBA as a business expense is if you meet the follow criteria:
    you pay for it yourself (not your employer)and:
    (i) The education is required in order to meet the minimum educational requirements for qualification in the employee’s current employment;
    (ii) The education is part of a study that will lead to qualifying the employee for a new position; and
    (iii) The education either maintains or improves skills required in the employee’s current employment position or meets the express requirements.

    An example of a non deductable MBA would be a HR person who gets an MBA in accounting and at graduation stops working in HR and becomes an accountant.

    I wonder if you MBA was deductable in the first place?

    Also Mortgage Interest does not put you in AMT, however Real Estate tax does.
    Quick question for the board. I have been hit by AMT in the past due to the fact that I wrote off my MBA at 45K a year for the last two years. Now that I am a homeowner and have the mtg interest tax deduction, does this count the exact same as my “non reimbursed business expense” deduction in the eyes of the IRS? For some reason I thought that mtg interest deduction would not take you into the AMT all by itself. It could all be wishful thinking though.

  111. John says:

    Ooops I ment to say for you can’t write if off if it is i, ii or iii.

  112. AntiTrump says:

    #62 Mojo Jojo Says:

    I know it all depends on what the seller paid it 2002, but 5% above 2002 prices seems reasonable to.

    The way I look at prices, I take 2001/2002 comparable and tack on about 3%-4% a year to reach the 2007 price. Remember that we saw some unusual gains in the last few years and barring major geo-politial calamities, I think we should account for what would have been normal price appreciation over the past couple of years and the one-off readjustment in prices to reflect cheaper credit (to the qualified buyers).

  113. make money says:

    Would anyone buy Well with a three handle?

  114. MJ says:

    [immigrants = lowering of education standard] is a generalization.
    immigrants may share a lower tax burden compared to the number of kids, which may result in lesser money per kid, however, that may not always translate to lower education standards

  115. SG says:

    John: 30 years ago immigrants dispersed and tried to fit into the towns they joined, today they like to cluster in towns and often bring their own problems to the new town.

    Are you trying to say that immigrants coming 30 yeats ago were better then today’s ones? I see there seems to be huze disconnect, where people think Immigrants that came earlier (may be their parents or grand parents) were ok or better then what we have today.

    John – Go out and look at the reality. Most people are not able to bear the news that today most immigrants make more money and well educated then folks who grew up in this area. All the towns that were mentioned where many educated immigrants are moving in actually their school districts improved. Even the native students got benefit of learnings from different cultures from around the world and improved their scores as well. Don’t give me the BS that immigration was ok 30 years ago and not now.

  116. BC Bob says:

    Chi [109],

    I would have been the same, if I was short.

  117. Pat says:

    I don’t agree with John on the immigration issue relative to testing.

    But I’m going out on a limb here and saying the immigrants in CNJ (you know who you are) better stop the smoking nonsense. Wise up.

    O.K., toss tomatoes at me, SG. Come on, dude. Where you at?

  118. Mojo Jojo says:

    Clotpoll, Grim: Thanks for the information on the Mendham listing.

    I can’t imagine having a $1M+ house on the market now with a need to sell it. Tight credit, heading into holidays and winter, bad news every day, fearful buyers. Must be lots of hand wringing going on.

  119. Ron says:

    Mike NJ #104

    AMT is a function of your AGI and specific itemized deductions. Mortgage interest is not an AMT preference item. However, your state and local taxes are. In other words, if you are subject to AMT, your state income tax and local property taxes are not dedcutible.

  120. bi says:

    104#, i even heard complaints from old folks that some recent immigrants have 2 families in one single family home. i know it is extremely minority but heard a couple of times talking to different people.

    > Taxes start to rise as three kids can cost the town 40K a year to educate yet the new owner pays only 10K a year in taxes, test scores fall as the new kids are behind.

  121. SG says:

    This is even more funnier then I thought. Yahoo finance headline now says,

    Stocks Slip Despite New Home Sales Rise

    SG Says:
    October 25th, 2007 at 12:32 pm
    I think these Journalists should be banned.

    Today morning at 10AM headline on Yahoo Finance news said,

    Stocks Up After New Home Sales Rise

    At present it says,

    Stocks Mixed After New Home Sales Rise

  122. skep-tic says:

    #107

    “Please explain the distinction between the PATH train and the subway.”

    well, for one thing, the PATH stops running at midnight.

  123. Mike NJ says:

    #112

    John, Yes I am fully aware of those rules and yes I made sure I stayed well within the guidelines in order to be fully covered. Writing it off definitely saved me a ton of money while I was renting, that is for sure.

    Thanks for the good news on the mortgage interest. That is what I thought but after the conversations on this board I wanted to be sure. My taxes are actually not that bad after I went and got a reassessment on my property this year (under $10K for Chatham). I am hoping that I escape AMT this year after dealing with it for the last few years. There is nothing worse then seeing a your tax software indicate you are getting $10K back and then all of a sudden the AMT calculation portion of the software kicks in and you actually owe $6K when all is said and done, that happened to me last year and it sucked. I need new windows on my house and that $16K could have come in real handy.

  124. ADA says:

    “well, for one thing, the PATH stops running at midnight.”

    And for a good chunk of the hoboken crowd that’s a big deal on friday and sat nights.

  125. SG says:

    Pat: O.K., toss tomatoes at me, SG. Come on, dude. Where you at?

    Well the only point I am trying to make is no immigrant group who came to this country was perfect. If you go back in history, even 100 years ago, folks were resenting new folks coming to US. Even back then you had communities formed based on where people came from, this is not new. It takes few years for anyone coming from any part of world to adjust. Nothing wrong with that.

    The only difference now is you have more folks coming from Latin America and Asia compared to Western Europe (which is mainly due to the fact that before 1965, those group were legally not allowed to immigrate). The point is before one starts bashing today’s immigrants they need to understand history first.

  126. kettle1 says:

    RE: immigration and schools

    You cannot honestly state that a large influx of illegal immigrants to a single area does not have negative impacts. when you have an influx of people into one school district who make moderately to significantly less then the median income for the area and are working illegally meaning that their level of tax contribution is highly suspect, the amount of resources per child in the school decreases.
    If illegal immigrant settled in a spread out pattern an attempted to assimilate there would likely be little issue locally. But when you have “sanctuary” cities where entire sections of towns become re-settled by illegal immigrants and the dominant language is spanish, you have a problem.

    SG:
    There may be benefits from cultural expansion, bu these happen when the new arrivals are willing to assimilate into the US and there fore combining their culture with our own, not by trying to create New Tiajuana.

  127. anotherone says:

    Hoboken as a “college town”? What college would that be?

  128. JBJB says:

    “Add an income surtax: The bill proposes that high-income filers would pay at least a 4 percent surtax on adjusted gross incomes (AGI) above $200,000 for married couples filing jointly.”

    The Rangle surtax would be for single tax payers w/ AGI of 150 k or above, or couples earning 200 k or above. That’s a serious marriage penalty, no?

    Also does anyone know if this would be in additon to the tax increase that would come as a result of not extending the 2001 & 2003 cuts? That would push the top bracket to like 44% or so.

  129. Stu says:

    #107
    That is not true

    It runs twice an hour then

  130. bi says:

    I am also against creating a new shanghai or new dehli or new moscow
    > not by trying to create New Tiajuana.

  131. kettle1 says:

    Well if we are going to be controversial here….

    the charts on this page ( from a pew global survey) should stir some people up. It shows a negative correlation between wealth and how religious someone is

    http://tinyurl.com/2eaaen

  132. chicagofinance says:

    Stu Says:
    October 25th, 2007 at 2:02 pm
    #107
    That is not true
    It runs twice an hour then

    Re: The PATH.
    #1 yeah it runs all night
    #2 it runs on a set schedule, so you know exactly when to leave where you are to catch it
    #3 you can always drop $40-$50 for a cab – or less if you know what you are doing

  133. evildoc says:

    —Close to half of the properties listed for sale in East Brunswick on realtor.com are under $400,000. I would hardly call that a high cost town—-

    True, very true, if the half the population of said town interested to buy said homes earns $150k per year. If they earn more like the $60k i’d bet they do…

    well…

    regards

    Evildoc

  134. x-underwriter says:

    evildoc Says:
    If they earn more like the $60k i’d bet they do…

    Excellent point. It’s still way over priced in relation to incomes.
    In contrast however, 38 properties out of 242 in Westfield are priced less than $400,000

  135. JBJB says:

    “Well if we are going to be controversial here”

    What is so controversial about the chart? I guess that the US bucks the trend?

  136. skep-tic says:

    my mistake re: the PATH. it is more convenient than I thought

  137. Mike NJ says:

    Kettle1,

    There is also the same negative correlation between how religious someone is and their intelligence (based on IQ). Just as interesting in my opinion.

  138. SaneSmith says:

    #129) Well there actually is a college in Hoboken. Stevens Institute.

    http://www.stevens.edu

  139. SG says:

    If illegal immigrant settled in a spread out pattern an attempted to assimilate there would likely be little issue locally.

    Whoa. Give me a break. The issue is not immigration, the issue is economic segregation in NJ. In NJ, you have rich towns, middle class towns and poor towns. The reason most people are forced to live in a particular town is to a great extent determined by how much they make. How much percent of African-American’s live in Summit? Now they have just not come in last 30 years. You can blame them for not moving to summit.

    Ask the rich towns to allow building of apartment complexes and you will see assimilation. Most rich towns (Summit etc..) don’t even want middle class, forget the poor class.

  140. Jamey says:

    My stars, people who live in Hoboken are SO defensive.

    “College town atmosphere.” Thanks for the laffs.

  141. rhymingrealtor says:

    Hi NJ GAL

    Have’nt noticed you commenting you in a couple days, If I don’t hear from my SIL (scheduled c-sec nov 6th)in 1 day I hunt her down. Your almost there, hope your feeling good.

    KL

  142. rhymingrealtor says:

    NJ GAL,

    Just thought of this, remember that post that Jim had from the otteau convention, live time blogging? It just got me thinking……………

    KL

  143. Justin says:

    For all your Realtors out there.

    What’s ACT mean in the MLS and how is it different than ACT*?

  144. bi says:

    142#, the economic segregation is a good thing for new jersey. do you want to have newark riot re-play in your neigborhood?

    in general, small towns are better than big cities; and small municiplity runs more efficiently.

  145. kettle1 says:

    SG, # 141

    In short, I agree with you but the subject is complex as there are multiple socieconomic aspects of the matter.

  146. SG says:

    Kramer on CNBC – His estimate subprime issue about $500 billion.

  147. Essex says:

    141….it is good sense to live in a decent place that is not going to drain your bank account….who wants to live in a high consumption town like that ??? It is hard to keep up with the Jonesteins….$$$$

  148. Essex says:

    Kramer also was bullish on motorola cause he thought they were cutting edge in the whole video over the cell phone market….yeah, he is the one to listen to.

  149. SG says:

    bi: the economic segregation is a good thing for new jersey. do you want to have newark riot re-play in your neigborhood? in general, small towns are better than big cities; and small municiplity runs more efficiently.

    I think you should move to small town in Montana. Your above mentioned wishes will be granted.

  150. waters says:

    Read this rumor on another board:

    “I just recieved an inside tip that Bank of America will be closing down it’s wholesale mortgage division as of December 1st.”

  151. Essex says:

    BofA….a bigger bunch of morons you will not meet…good riddance….this whole scene is economic darwinism.

  152. Homer says:

    From earlier posts,
    NJ average household income is $65,000.00
    When figuring out how much you can afford on a home its 2.5 times the annual income is 162500.00 but people also need to remember property taxes have increased too, so now you may need to spend 100-500+ more a month on property taxes than you did a few years back.
    So really 162500 is pushing it. Hasn’t everyone notice that everywhere is now a convient area to NYC? Places are marketed that way beucase the average NJ worker cannot afford those prices, so they had to get NY’ers who make good money. I think there should be a report on income brackets in NJ
    30-40
    40-50
    50-60
    60-70
    70-80
    80-90
    90-100
    100-125
    125-150
    and so on. The point is everyone thinks everyone in NJ makes over 100k which is far from the truth. Things need to be put into prespective to get a better understanding on where the prices will be realistic. I said a while ago and I will say again we need to have areas for all kinds of incomes I have looked back in areas in central NJ from 97-2001 and there were places at 100k places to buy. I am talking about 3 bed 2 bath places decent sized.
    Salaries have not increased that much over the passed few years, but property taxes have. People need to stop being absurd about there asking prices, hey for some the bubble was fun while it lasted, but if you got into the game to late, well he you gotta face the consequence thats…Thats life.

  153. Essex says:

    Well this is a case of restraint as well. Those who did not take the rope that the banks offered to hang themselves with are better off than the person who went way over their head and bought as much as they ‘qualfied’ for. Being housepoor is a bitch right now.

  154. Everything's 'boken says:

    ‘My stars, ‘

    I haven’t seen that for a long long time…

    ‘people who live in Hoboken are SO defensive.’

    Why does a response asking for information and suggesting reasons for behavior strike you as defensive?

  155. Johnny Boy says:

    RE:AMT – I don’t see how any couple making over 200k (top 5%, quite a few in NNJ/NYC I imagine) would be happy paying an extra 4% surtax on something that was a “wrong” (i.e. not inflation adjusted since ’81) ALL ALONG!!!!

    Of course it’s the professional folks in the upper middle class (100-300k) who have always been nailed when it comes to taxes.

    But this is the first round, we’ll have to wait and see where the merry dance ends…

    Read “Perfectly Legal” about how the super rich get richer and prepare to be pissed.

  156. kettle1 says:

    SG #151

    I concur….as i have said before, if you really want to see what a town/city looks like when you have no middle class or a very small/weak middle class, then i suggest you go look at places like in this link
    http://tinyurl.com/2lmpss
    Any society will always have poor people. The key is whether or not you have a solid middle class that allows for a middle ground between the filthy rich and the filthy poor.

    My personal thought on the matter is that you cannot solve poverty. Poverty is ultimately driven by thermodynamics; i.e the secind law of thermodynamics “a process can occur only if it increases the total entropy of the system”. So if you have a large class of extreme rich people, that must be balance by an extreme class of poor people, while a strong middle class balances the system.

  157. bi says:

    152#, i wish i could. but here is the list oftop 12 high income towns in new jersey (100 households or more), all have relatively smaller size:

    (data from 2000 survey)

    Mantoloking
    Saddle River
    Far Hills
    Essex Fells
    Alpine
    Millburn
    Rumson
    Harding
    Bernardsville
    Chatham
    Tewksbury
    Mountain Lakes

  158. Mike NJ says:

    What ever happened to that guy from Charlotte? He might want to start thinking about buying a place in Meyers Park on the cheap. The i-Bankers that are getting the boot from BofA will probably all have to move up here to find a job. Wachovia can only take in so many new hires down there.

    Bank of America to cut 3,000 jobs
    Bank to review investment banking unit, shake up management

  159. grim says:

    $90.46!

  160. dreamtheaterr says:

    People, when you talk about immigrants, please do yourselves a favor and differentiate a bit:

    1. Illegal immigrants who pay no taxes and kids get free education.

    2. Legal immigrants who are here because of ‘family’ – not necessarily well educated, not necessarily employed and kids get an education

    3. Legal immigrants who are here because of ’employment’ – well educated, well-paid, pay taxes and kids get an education.

    HUGE DIFFERENCES.

  161. gary says:

    Oil over $90? Thank God the new home numbers are up. Whew!!

  162. Rich In NNJ says:

    Justin Says:
    October 25th, 2007 at 2:46 pm
    For all your Realtors out there.

    What’s ACT mean in the MLS and how is it different than ACT*?

    ACT: Active Listing
    ACT*: Active Listing under Attorney Review (someone has put a bid on the unit and it not yet under contract so it is possible fo rthe sellers to still receive bids)

  163. make money says:

    $90.46!

    It’s OK according to Bi we have hit the peak.

  164. make money says:

    Bank of America today announced that it will exit the wholesale mortgage business in order to devote increased energy to its expanding retail channels.

    We will be fulfilling all of our contractual obligations to you and your customers. You will receive formal, written notification of the termination of our Wholesale Broker Agreement by end of day Friday, October 26 with an effective termination date of November 25, 2007. During this transition period, please be assured that our sales and fulfillment teams will continue to provide you with the exceptional level of service you’ve come to expect. If you have any questions during this time, please contact your account executive.

    We thank you for your business and wish you continued success.

    it’s ok according to NAR we have reached the bottom!!!!!!!!!!

  165. bi says:

    kettle, it is the first time crude settled above $90. you need 4 more days to declare victory.

  166. grim says:

    From MarketWatch:

    Deteriorating subprime market pummels ABx, bond insurers

    Fresh evidence that the subprime mortgage problems are growing worse pummeled a leading derivative index Thursday, and caused investors to grow much more cautious about the prospects of bond insurers and financial institution American International Group Inc.

    Troubling data on subprime mortgage delinquencies and defaults released Thursday pushed the riskiest, BBB- portion of the closely watched ABX index based on mortgages made in the second half of 2006 to record lows.

    Investors have used the ABX index as a gauge of the subprime market since its fortunes have largely led the deterioration of mortgages extended to borrowers with shaky credit. The BBB- slice of the index traded at a record low of 18 cents.

    Even the less risky tranches of the index are much weaker, with the A and AA tranches hit the most. The single A slice of the index based on loans from the second half of 2006 is quoted at 28.5 cents, down from a close of 32.42 cents.

    Though analysts are still digesting the reams of data on loan performance released by the trusts that hold loans that ultimately influence the ABX index, the preliminary readings of these remittance reports are bad.

    “After seeing the remit reports, people are saying it’s time to go back into bomb shelters because the war continues unabated,” said Dan Nigro, ABS portfolio manager at Dynamic Credit Partners in New York, a hedge fund investing in ABS, CDOs and distressed structured finance, with $5.5 billion in assets under management. Nigro trades the index and has been buying protection, and therefore, benefiting from the declines in the index.

  167. Salty Steve says:

    I’ve been considering putting a low-ball bid on a cape in Madison. I’d like to hear anyone’s opinion on what i’ve learned so far. Here goes…

    It is a 4bd 2ba non-updated cape listed for 479k. DOM is about 50 days…
    My real estate agent (Who is supposedly “working” for me) told me he contacted the seller’s agent and they said the seller is not interested in entertaining any offers below 470k because that number will allow them to pay off mortgage plus closing costs. However the seller’s agent also supposedly said that we should keep watch on the property because it is possible that it could become a short sale. The current owner is barely able to make the payments.

    So that is what I know. I was thinking of offering around 370k, because realistically that’s probably about what it’s worth.

    I’ve looked the property up on the morris county tax website and that website indicates that there is no mortgage, which suprises me.

    anyways, let me know what you think?

    thanks…

  168. SG says:

    Kettle1: then i suggest you go look at places like in this link.

    Nice link. In fact, I grew up in Mumbai, so I have lived among extreme rich & poor from child hood. There are just too many complicated issues like corruption, lack of planning, lack of enforcement, migration, illitracy that have caused that. I wish things were different, but they are what they are.

    Coming to NJ. The situation here is on the other end of spectrum. At least in NJ, we have too many small towns for the amount of population and land we have, each making there individual rules. Because of that you have rich towns like what Bi mentioned, making sure in whatever way to keep economic segragation. What happens is most politician exploit the idea that “Property value will go down, if we allow more development and lesser income people move to that town”. The towns that allow lower income houses are the ones where poor people are forced to live.

  169. John says:

    My point about clustering imagrants is this. Back in the 1940s through 1960s the typical Italian, Irish, German, Polish etc. may have immigrated to a certain area such as Long Island or Jersey but at that point they tried to adapt to America and brothers, sisters, uncles, aunts etc. often settled in different towns.

    Todays immigrant and I will use my mothers old neighborhood as an example tends to cluster move. My mothers neighborhood was pretty expensive and had fantasitic schools. We had a few well off asian families in the 1990s and by 2003 every shoemaker, tailor, bar, itailian resturant and jewish delli in town starting going under and being replaced one by one by asian stores. By 2004 the stores took down the English signs and the signs were only in Mandarian and employees only spoke Manadarin. Then since the asians had their only plumbers, carpenters, painters, etc. from Flushing who work off the books do all their stuff, one by one all the plumbing and painters etc. went out of business. In the end even the church had to cut back the masses and a few temples had to close as the Asians were not practicing those religions.

    Funny thing is that the schools scores fell every year and taxes are now up and now RE values are falling as what was once considered a Wall Street upper class crowd neighborhood is no longer a high class neighborhood.

    30 years ago you would not see for instance a German family move to a surburban well established town and try to drive every non-German business out of business and slowly change every store sign to German while increasingly islolating the non-Germans so they would move. Back in 1800’s the Irish and Germans did cluster move to slums but that was out of necissity. Todays cluster moving is a whole new ballgame.

  170. John says:

    The only difference between one and three is that one does a job no american wants and three takes a good job from an american. The number two imigrant sounds like any other working stiff in america. Kick one and three out of the country.

    dreamtheaterr Says:
    October 25th, 2007 at 3:33 pm
    People, when you talk about immigrants, please do yourselves a favor and differentiate a bit:

    1. Illegal immigrants who pay no taxes and kids get free education.

    2. Legal immigrants who are here because of ‘family’ – not necessarily well educated, not necessarily employed and kids get an education

    3. Legal immigrants who are here because of ‘employment’ – well educated, well-paid, pay taxes and kids get an education.

    HUGE DIFFERENCES.

  171. BC Bob says:

    $90.46!

    [161]

    I would imagine if anybody loved shorting it in the high 70’s, they must be taking a hel to short it here.

  172. kettle1 says:

    John # 172.

    You post is that point that i was trying to get across. Its not immigration itself that is the problem, legal immigration where the people are willing to try and integrate is a good thing. Uncontrolled illegal immigration where the people try to recreate their native culture is the issue. Assimilation is beneficial to both the immigrant and the current residences.

  173. mr potter says:

    #170 Steve

    I think its a bad time to buy. But if your circumstances are that you need to buy today, I would offer what you think its worth(considering at least another 10-15% reduction) and put a 48-72 hour expiration on your offer so they cant shop it.

  174. kettle1 says:

    Bi,

    Dont worry i wont gloat four days from now when oil is still over $90 ;)

    actually it may not happen in the next week, but i still stand by it happening by the end of the year.

  175. kettle1 says:

    #173 John Says:
    October 25th, 2007 at 3:59 pm

    The only difference between one and three is that one does a job no american wants and three takes a good job from an american. T

    John,

    the whole line about doing a job that an american wont is BS! The truth of the matter is that employers are not willing to pay market rates for the labor that they want. Employers are essential circumventing the market by using illegal labor. Employers are also using illegals to avoid the secondary costs such as taxes and insurance. The illegal aliens are bringing everyone down by working for substandard compensation. Granted i understand that their point of view is that they are still making more money this way then staying in mexico or guatemala, bu the fact remains that they are still negatively impacting everyone, including themselves y accepting substandard compensation.

  176. dreamtheaterr says:

    John,

    Re. #1, what ever happened to dignity of labor? Isn’t that what made America great in the first place? Since when is it below an American’s dignity to be a janitor?

    Re. #3, aren’t there Americans who go overseas and work fOr US and domiciled companies? It is obvious that you have absolutely no clue of how strict the immigration process is for individuals to come to the US and work. While on a working visa, you cannot deviate from your line (specialization) of work. You also cannot apply to 95% of jobs because most companies cannot sponsor you. So the argument of jobs being taken away is attacking the fringes.

  177. MJ says:

    “The only difference between one and three is that one does a job no American wants and three takes a good job from an American.”

    Given the excellent American education, and the native language advantage, Americans should be able to compete in the 3rd category.. right..

    Don’t be the middle finger http://www.businessweek.com/bwdaily/dnflash/may2005/nf20050520_9852.htm

  178. Salty Steve says:

    #176 mr potter

    Thanks for the expiration suggestion, we’ll probably include it.

    I’m thinking.. house is listed for 479k, neighboring homes were selling for 460k during the good ‘ol times. applying a 20%+ haircut puts it down about 375k. house is at 39 wayne blvd in Madison…

    another question I have is what information is available to help me set the lowest possible offer price when a home is in short-sale mode?

    also, are morris county homes that enter short sale mode selling quickly in today’s market?

  179. John says:

    The problem with illegal immigration is a cultural one. The same people who are against it, get cheap lawn service, cheap nanny service, cheap maid service, cheap chinese food etc. by these businesses hiring illegal workers yet are against illegal workers. The reason they come here is that their are jobs here and you drive through any rich neighborhood between 9-5pm on a weekday and watch the illegal nanny with the baby carriage and the illegals maids cleaning and the illegals mowing the lawn all made possible by the incredible low salaries and lack of benefits these people receive you can see that this problem ain’t going away anytime soon.

  180. John says:

    That women in charge of Pepsi hates americans, men and junk food as she is a vegitarian. I would love to use my middle finger on her. Of course it may come back the color of Pepsi.

    MJ Says:
    October 25th, 2007 at 4:16 pm
    “The only difference between one and three is that one does a job no American wants and three takes a good job from an American.”

    Given the excellent American education, and the native language advantage, Americans should be able to compete in the 3rd category.. right..

    Don’t be the middle finger http://www.businessweek.com/bwdaily/dnflash/may2005/nf20050520_9852.htm

  181. bi says:

    173#, the town you mentioned is in NY or NJ? I thought most recent chinese immigrants are clustered in flushing area, koreans are in fort lee, indians in edison, russians in staten island…

  182. bi says:

    184#, john, how do you know she hates americans? give a link.
    junk food maybe if she is vegitarian.

  183. dreamtheaterr says:

    You want to solve immigration?

    1. Close the borders so that illegals cannot enter.

    2. Fix the healthcare system. The overheads are crippling US competitiveness. When you hire a $8/hr worker but have to pay $4/hr for health insurance premiums (50% overhead), employers will cut corners.

    2. Pass a law that if you are not born in the US, you cannot buy real estate in the US. This will encourage people to return to their home country or dissuade them from coming here. If they wish to be here, they can choose to work here and rent till they drop dead.

  184. Secondary Market says:

    152
    “I just recieved an inside tip that Bank of America will be closing down it’s wholesale mortgage division as of December 1st.”

    they are done…but only to take over Countrywide.

  185. lisoosh says:

    “My point about clustering imagrants is this. Back in the 1940s through 1960s the typical Italian, Irish, German, Polish etc. may have immigrated to a certain area such as Long Island or Jersey but at that point they tried to adapt to America and brothers, sisters, uncles, aunts etc. often settled in different towns.”

    Like all the Italians from Brooklyn who moved en masse to Staten Island? And then on to Jersey? Town near me is still 80% Italian, 90 years after their forebears emigrated and heaven help anyone of color who makes the mistake of trying to move in.

    Your memory is extremely selective.

  186. Theo says:

    Can anyone give ma any information on these three MLS #s

    2406931 S. Orange
    2393268 W. Orange
    2380489 Montville

    Have they sold or expired or what?

  187. chicagofinance says:

    John Says:
    October 25th, 2007 at 4:24 pm

    you should be permanently banned

  188. mr potter says:

    Surprising, not much commentary in the new home sales which were up

  189. bi says:

    192#, no thing surprising. new home sales were up since august number was revised down. today is dominated by $90 oil. tomorrow will be msft up and chinese stock market crash tonight (maybe)

  190. SS says:

    #178 Kettle1

    I think it’s a mixture of both actually. Back in high school and throughout university I landscaped. Great part-on/part-off the books job (until I got hernia). However, during my 7 years of digging ditches there was a huge change. Our original group were all 2nd or 3rd generation Americans (Italian, Irish, German). Then one by one these people left and illegals began working. Yes the boss liked paying lower wages, but he also couldn’t get the younger generation kids to come work…not even his own son.
    Immigration is great thing, and in fact is the reason America is what it is today, but it needs to be monitored.

  191. SG says:

    John: You need to get off the Immigration debate, as you seem to have no clue on history and present global realities.

    In last 2 decades US has remained growth engine for world largly due to productivity increases achieved due to high technology implementations. Take away the third portion in your argument and you got US going to tanks like Europe, with countries like France. You take away the first immigrant category and then you will be paying $5 for a pound of tomato.

    Regarding historical immigrant vs today, the issue of clustering you mention is by and large in cities or states which have not allowed easy assimilation. NJ is one such state, where you find majority of rich towns not having or allowing creation of rental apartment complexes. Most immigrants first rent apartment, and hence they are forced to towns that have complexes (in NJ towns like Edison, Parsippany etc…). I have lived thru and tell you NJ sucks for immigrants, but most people live due to family or social network reasons. You don’t have this clustering issue in North Carolina or Vergina or Connecticut or Pennsylvania. You have it in NJ because of lack of rental units in rich and middle class towns. This was not the case in 60’s. At that time, most towns were not as restrictive as today.

  192. chicagofinance says:

    MSFT just crushed earnings

  193. PeaceNow says:

    Uh, just to correct one HUGE misconception that appears frequently on the board: Many illegal immigrants DO PAY TAXES!

    First of all, think of it from an employer point of view: If you pay your workers cash (without an accompanying 1099 at end of year), you can’t deduct their wages. (I used to own a small business that hired lots of freelancers…and why would I want to pay their taxes?)

    Second, illegal immigrants frequently buy fake social security cards and/or just make up a number. (In another career, I worked at a law firm that pursued prevailing wage claims on behalf of underpaid public works construction workers.)

    But why should you believe me? Here’s a link to a news piece about it…and about why the Social Security Administration doesn’t particularly care:

    http://www.iht.com/articles/2006/09/04/news/id.php

    And as for not paying their mortgages, and their property taxes: I believe JB had a post about this a week or two ago, to the effect that mortgage brokers are eager to lend to illegals, because they don’t default.

  194. Poser says:

    salty steve,

    i just sold 4b 2ba cape in madison. the section you’re looking at is not the most expensive section of town, but it’s ok.
    if the house hasn’t been updated, your offer, while it may not be accepted, is about right. at their asking price, by the time you update/renovate it, it won’t be worth what you put it into it.

  195. chicagofinance says:

    SaneSmith Says:
    October 25th, 2007 at 2:30 pm

    Are you THE SaneSmith?

  196. SG says:

    PeaceNow: Good points. It’s just goes to show that how ignorant most people are about immigration. The folks like Pat Buchanan etc… use Immigration to garner vote bank, by mis-using statistics.

    I am not saying Immigration is best thing, but it is not also the worst thing as propagated by many. Immigration is what made US different compared to most other nations in world. Take it away and you are the same as any other country in the world. Mediocracy will kick in quickly.

  197. PeaceNow says:

    Oh, and I’d wanted to add re: poor/rich towns and clusters of immigrants (both legal and illegal).

    Much of this has something to do with towns being allowed to sell the quota of affordable housing they’ve been assigned under something called the “Mt. Laurel decision”. So poor towns can take on the number of units assigned to a rich town for a cash payment. (This is just one of the things that is seriously wrong with NJ.)

  198. John says:

    Indra Nooyi is a vegitarian and is proud of her ‘Indianness’ and flaunts it happily. Her home in Fairfax County, Connecticut, where she lives with her husband Raj Kishan Nooyi and two daughters, Preetha and Tara, is designed with a traditional touch, complete with a large puja room. Carnatic music rings through the rooms, giving a temple-like feel. Nooyi doesn’t shy from giving due credit to her “fantastically supportive” husband.

    So she does not eat meat yet she wants to poison americans with her nasty KFC and Taco Bell crap and she pushed the 58 year old american who was in line for CEO out of the way to get it. She gave the parents at Columbia the middle finger and she almost makes me want to drink COKE>

  199. MJ says:

    you dont have to kick the legal immigrants out, it may happen on its own..
    http://www.informationweek.com/news/showArticle.jhtml?articleID=202601624

  200. chicagofinance says:

    John Says:
    October 25th, 2007 at 5:11 pm
    So she does not eat meat yet she wants to poison americans with her nasty KFC and Taco Bell crap and she pushed the 58 year old american who was in line for CEO out of the way to get it.

    Toilet: Yum! Brands owns KFC & Taco Bell….clown!

  201. Zack says:

    What is John smoking?

  202. chicagofinance says:

    By the way, you are dissing one of the highest ranking and most respected woman in corporate america.

    Also, literally all of the important future growth of that company is going to be derived from India and China…..who better to run the company than a South Asian….dimwit!

  203. Sean says:

    re: immigration

    I have been told by my brother in law who renovates high end homes up in Westchester that many of the illegal alient workers have gone home early (many leave for winter) do to lack of employment in the construction trades. You won’t see those numbers on any goverment report.

    I would support a temporary workers permit, with full documentation and they pay some necessary income taxes. We are one of the few countries in the world that does not have a guest worker program for blue collar jobs.

  204. dreamtheaterr says:

    I need to get John some of the good stuff they smoke in the Himalayas…… wrapped in 1 ply toilet paper.

  205. njrebear says:

    http://www.marketwatch.com/news/story/aig-may-take-98-bln/story.aspx?guid=%7B7D2129DC%2DFAC3%2D416C%2DBBF3%2D41F67B8AE3A1%7D&dist=hplatest

    AIG may take $9.8 bln subprime hit, analyst says
    American International Group’s losses estimated to be big, but manageable

  206. bi says:

    204# pepsico owned all these outlets back to 8 years ago. YUM is a spin-off from pepsico

  207. Fencesittingjack says:

    Priced right? another buzz term from the RE shills.
    All I know is trhings are uggllleee and it’s going to be fun placing a fair bid on a house.

  208. Fencesittingjack says:

    American International Group’s read that aig has about $64 Billion (gulp) in sub-prime debt holdings.
    Of course I also read they do not mark it to market because these are held as investments.

  209. Pat says:

    Back in August, Richard told me illegal immigrants are gone because they went on some kind of migrant fruit-picking mission. Nobody was swimming in the river!

    They are gone period. The 7-11 doesn’t stop stocking sweet Spanish pastries for this long for nothing. And there’s never a line at the Western Union anymore.

    I live in/near a haven for illegals. They are outta here.

    Serious question. If you had to vote on a solution for the illegal immigration controversy, and you knew it would tear our country apart, how would you vote?

    1. Deportation
    2. Long-term worker program
    3. Combination worker program/citizen track
    4. Let em all be citizens as long as they register and start paying taxes.

    No analysis. Just pick a number from 1 to 4.

  210. dreamtheaterr says:

    1

  211. Pat says:

    How come I miss Duck?

  212. still_looking says:

    …OT
    read this: (bear with me through the first few paragraphs but do read the whole thing.)

    then think Katrina.

    just food for thought.

    sl

  213. Pat says:

    dream, I never figured you for a hard@ss.

  214. kettle1 says:

    #216

    what are you talking about did you mean to link something?

  215. Frank says:

    #212,
    1, but I heard that Mexicans will soon outnumber humans in this country.

  216. Frank says:

    Any predictions on Countrywide stock tomorrow? I think it will hit $8 by 10am.

  217. bi says:

    223# i am going to buy cfc on weakness

  218. Frank says:

    Do you mean put options? because there are going straight to the BK court.

  219. Salty Steve says:

    #210

    priced right. Always comes down to what fair rent people are willing to pay for a place. Condos and townhouses it’s pretty easy to find the “right” price.
    In good parts of morris county, a 1 bedroom should rent for about 1200/month and that equates to about 150-165k. 2 bedroom maybe 1700/month or about 250k. These numbers may be a little conservative, but that’s the way I see it…

    Houses are more difficult to price “right” because the percentage of homes that are rentals is less.. (e.g., you look at a 5 story condo complex and 20% of them may be rentals for the past 15 years or something, whereas a subdivision may have 1 or two homes rented out on and off over the years)

    peace,

    …Salty

  220. BLB says:

    Immigration is what made US different compared to most other nations in world. Take it away and you are the same as any other country in the world. Mediocracy will kick in quickly.

    But to compare the bulk of today’s immigrants (low skill, low education) with the immigrants of 100+ years ago is misguided. The circumstances are different and so are the people.

    100 years ago, your typical unskilled person could step right into the mainstream labor market.

    Most of today’s “immigrants” cannot. They are only suited for low-skill jobs that often cry out for automation. And by relying on low wage workers we discourage innovation.

    Ask yourself the following when evaluating immigrant groups:

    * Do they achieve much economically?
    * Do they achieve much academically?
    * Do they invent useful technologies and techniques?
    * Are they (or their descendants) incarcerated at a rate less than or equal to the general native population?

    If you’re honest with your answers, you’ll soon find your “mediocrity.” Then ask yourself if you REALLY want that.

  221. bi says:

    * Do they invent useful technologies and techniques?
    how many people did that?

    other than this, all answers are yes. otherwise they are all back to where they are originally from.

  222. chicagofinance says:

    bi Says:
    October 25th, 2007 at 8:24 pm
    223# i am going to buy cfc on weakness

    bipolar: I misread this post at first. I thought you wrote “i have been smoking pcp’s contually since the Preakness”…..It’s Breeder’s Cup weekend you know. It is an easy mistake to make.

  223. kettle1 says:

    Looking # 216

    That was a good piece (links is # 226). As an eagle scout myself, i think that the piece had a great point. The government certainly doesnt want you to be self sufficient. self sufficient people need very little help generally speaking and are hence hard to control by dangling carrots. Katrina is a perfect example or what happens when you dont know how to fend for yourself.

  224. bi says:

    202#, john,

    this middle finger stuff is just a poor example, hardly to qualify her “anti-american”. so save your middle finger.

    http://www.businessweek.com/bwdaily/dnflash/may2005/nf20050520_7587_db042.htm

    Larry Ellison’s home is japanese garden style, do you also have problem with that?

    if KFC or TacoBell are posoning americans, she did the right thing by pushing away the 58 guy since HE is a bigger culpit. Remember she is an american too. this is just normal office politics.

    >Her home in Fairfax County, Connecticut, where she lives with her husband Raj Kishan Nooyi and two daughters, Preetha and Tara, is designed with a traditional touch, complete with a large puja room. Carnatic music rings through the rooms,

    >So she does not eat meat yet she wants to poison americans with her nasty KFC and Taco Bell crap and she pushed the 58 year old american who was in line for CEO out of the way to get it. She gave the parents at Columbia the middle finger and she almost makes me want to drink COKE>

  225. BC Bob says:

    “223# i am going to buy cfc on weakness”

    As opposed to recent strength?

    Do yourself a favor, take a trip to the window. The Bayonne Bleeder is answering the bell.

  226. lisoosh says:

    Wow.

    Many people here have pretty high opinions of their own “salt of the earth” immigrant ancestors.

    And considering the US and its substandard education system have been incapable of producing enough engineers, scientists, doctors and nurses to meet its needs for quite some time now we should be pretty grateful that the country can attract highly educated immigrants.
    Without them, the preeminence of the good old USA would have ended even sooner. All that innovation, invention and good old fashioned work ethic staying put in their own nations and helping to build them up, imagine.

    Oh and of course a 4 week wait for a basic medical appointment and no-one to change dressings after an operation because we have been poaching foreign trained medical staff for years. Bummer.

    And we have 4.5% unemployment around here – considered 0 from an economics point of view, so exactly whose jobs are they taking anyway?

  227. BC Bob says:

    Buy weakness?

    “The cord breaketh at last by the weakest pull.”
    – Francis Bacon, On Seditions

  228. bi says:

    233#, i know something is wrong with countrywide since Bank of Americans $18 offer cannot support the stock. but one day the dust will settle and the rumor on the street will be buffett is buying cfc…

  229. lisoosh says:

    SG – don’t get upset by the “immigrant cluster” BS, that is exactly what it is, BS.

    The pattern of immigration of EVERY ethnic group that has ever arrived in this country is for the initial immigrants, the first generation to cluster in a distinct community. Their children go to schools in the US and gradually move away from that community to assimilate more.

    Why do you think Manhattan has a “Little Italy” and a “Chinatown”? The Ironbound area of Newark is full of Portugese. Half of Boston is Irish. The Lower East Side was traditionally first generation immigrants, my own ancestors started out there then moved up the Hudson to White Plains – which is as stereotypical as you can get. The mountains of Virginia and much of the south are populated by people who still call themselves “Scots-Irish”, a term I have only ever heard here in the US as no Scot or Irishman would ever call himself that. And the Upper East side is WASP city. White Anglo Saxon Protestant, still clustering together after all these years.

    So pay no attention.

  230. BC Bob says:

    “And we have 4.5% unemployment around here – considered 0 from an economics point of view, so exactly whose jobs are they taking anyway?”

    lisoosh,

    Real #’s or some contrived birth/death employment #’s?

  231. BC Bob says:

    BC Eagles, no rumor!!

  232. chicagofinance says:

    Three Strikes for Mozilo, and Counting
    By JAMES R. HAGERTY
    October 26, 2007

    Angelo Mozilo has built a reputation as a wily survivor since co-founding Countrywide Financial Corp. 38 years ago. This morning, when Countrywide reports third-quarter results, the 68-year-old CEO is in for the challenge of a lifetime: trying to persuade investors that Countrywide can withstand a worsening mortgage and housing meltdown.

    The stock closed yesterday at $13.07. That puts it down 31% this month and 69% so far this year.

    There is huge uncertainty about just how badly Countrywide has been wounded by a contraction in the lending market and surging defaults. Analysts’ quarterly forecasts range from a loss of 10 cents a share to $3.47 a share, compared with earnings of $1.03 a share a year earlier, according to Thomson Financial. A loss of $3.47 a share works out to $2 billion.

    Countrywide needs to mark down billions of dollars of mortgages and securities. Mr. Mozilo already has warned that default problems are “bleeding” from subprime into other aggressive types of loans that somehow were deemed prime a year or two ago.

    To attract deposits, Countrywide’s savings bank is offering a lofty 5.65% on 12-month certificates of deposit, cutting into profit margins. It’s unclear whether the company is slashing costs fast enough to cope with a shrinking market.

    Mr. Mozilo shot himself in the foot by gunning for market share even as housing was sinking. He’s also hurt his credibility with investors and employees by increasing the pace of his own share sales this year through the exercise of stock options. He says those sales have been arranged properly.

    In another blow, Henry Cisneros, a former U.S. Secretary of Housing and Urban Development, stepped down from the Countrywide board this week, the third director to quit this year. Mr. Cisneros expressed “enormous confidence” in Mr. Mozilo.

    Still, as Oscar Wilde might have put it, losing one board member at a time of crisis might be called a misfortune; losing three looks careless.

  233. profuscious says:

    wow, matty ice!

  234. chicagofinance says:

    Hey…..I said Dorian Gray last night…..the WSJ is ripping me off those MF’ers!

  235. dreamtheaterr says:

    Pat Says:
    October 25th, 2007 at 7:54 pm
    dream, I never figured you for a hard@ss.

    Pat, I look at this way because:

    It took me five years to ‘prepare’ (to show proof that I have ties to my home country)so that I could get a visa to come to the US for my MBA. The US consulate denied my visa to come to the US for my undergrad when I had a full scholarship to a University. It has taken another me 6 years in the US, and I still have a way (another 2-3 years perhaps) to go before getting permanent residency. That’s 14 years in total to get a legitimate shot at the American Dream.

    Compare that with illegal immigrants who break the law to get in here, I happen to be less compassionate toward them, no matter how they justify their reason to be here.

    My apologies if I sound curt, but I say it as I see it.

  236. BC Bob says:

    Pro [241],

    I may have to visit Death Valley on 11/17 and rub Howard’s Rock for good luck.

  237. dreamtheaterr says:

    Talking about Death Valley, I happened to be finishing up a quick vacation there in November 03 and driving back to San Diego on Interstate 15 when they last had a HUGE fire and remember being stuck on the Interstate for 6 hours, and being detoured through LA. What a nightmare……

    That fire was pretty serious and burned a few days too, but pales in comparison to the current fire.

  238. Pat says:

    Yeah, I had it rough, too. No soup for me.

    Sucks to be a poor chick from a coal mining town-I’ve been working on that American Dream for 44 years.

    I’m voting Number 4, after much soul- searching and three years of believing in Number 1.

  239. lisoosh says:

    BC – in all honesty, probably some BS number, but I have always been fascinated by the low unemployment/ but they are taking our jobs disparity.

    I have a feeling that the economic aspects are more complicated than most would want to admit.

  240. lisoosh says:

    Pat – on your poll I hover between 2 and 3.

    If we really need the cheap labor, we might as well be honest about it.

  241. profuscious says:

    BC #244

    If you’re thinking about going down, make sure you get some tickets soon, because if BC is no. 1, you’ll be lucky to get anywhere close to that rock.

  242. John says:

    chicagofinance Says:
    She herself was part of management that spun it off and Pepsi is one of the biggest shareholders of YUM
    October 25th, 2007 at 5:32 pm
    John Says:
    October 25th, 2007 at 5:11 pm
    So she does not eat meat yet she wants to poison americans with her nasty KFC and Taco Bell crap and she pushed the 58 year old american who was in line for CEO out of the way to get it.

    Toilet: Yum! Brands owns KFC & Taco Bell….clown!

  243. John says:

    In india they practice the caste system, the outcast in Hindu are treated like dirt in their own religion and if they try to switch religions to christianity or the muslim religion the govt will punish them by cutting off subsidies. The govt even tried to arrest Elizabeth Hurley for having a drink at her own wedding in India cause it is now allowed. The country is very racist, prohibits freedom of religion and in all is a hell hole. India would never let an American Women go their country and be CEO yet Pepsi is cool with it. I have no problem that she is an Imagrant, I just have a problem that she is really just a narrow minded racist.

  244. John says:

    STILL FALLING
    EARNINGS PREVIEW SENDS SCARE INTO COUNTRYWIDE
    By ZACHERY KOUWE
    Ailing mortgage giant Countrywide Financial is set to report shockingly dismal third-quarter results today that could send the broader stock market down and raise fears that the global credit crunch is far from over.

    Shares of Countrywide, which have plummeted 67 percent this year, dropped 5.50 percent yesterday on investor fears that the company will report much weaker than expected results.

    The stock closed at a four-year low of $13.07, off 76 cents. Countrywide has been hit with a severe liquidity crisis and has been cut off from the short-term commercial paper market, where it raises money to fund new loans, for several months.

    The company is also in the midst of transferring its existing loans into its fairly small retail bank and laying off 12,000 workers.

    On Wednesday, chief Angelo Mozilo sent an e-mail to all Countrywide employees thanking them for their continued dedication during the “unprecedented worldwide credit crisis” and pledging to do everything in his power to right the ship.

    Mozilo is also under fire for selling over $150 million worth of Countrywide shares this year as the crisis deepened.

    Sources close to Countrywide said yesterday that Mozilo has been urged by his outside advisers to eliminate the company’s dividend, which could save about $350 million a year.

    Federal officials at the Treasury Department have privately urged Mozilo to maintain the dividend to prevent wider fears in the market, but sources said last night that he was leaning toward suspending it indefinitely.

    Sources also said that Treasury Secretary Hank Paulson has been trying to persuade the White House to provide financial compensation to Countrywide and other mortgage lenders that help troubled homeowners by renegotiating the terms of their loans.

    But the plan is meeting stiff resistance from lawmakers who are wary of bailing out irresponsible mortgage companies.

    Earlier this week, Mozilo announced a plan to modify $16 billion in mortgages to homeowners who would otherwise default because of rising interest payments.

    Wall Street analysts expect Countrywide to report a quarterly loss of $1.26 per share today, according to Thomson Financial.

    But profit estimates are all over the map, with one analyst predicting that Countrywide could report a loss of only 28 cents a share and another claiming the loss could be $3.47 a share.

    On Wednesday, the company disclosed that Henry Cisneros, who served as housing secretary in the Clinton administration, abruptly resigned from the board of directors.

    Earlier this month, Countrywide said its mortgage loan fundings fell 44 percent in September from the year-ago month.

    Mortgage defaults and foreclosures were also up compared with last year.

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